MIDEAST STOCKS-Saudi at 67-mth high as property cos gain; most of region firm | Reuters:
"* Some money shifting from Saudi blue chips to property cos
* Dubai recovers from profit-taking before close
* Arabtec bounces after Reuters report on Kuwait M&A
* Kuwait slumps before three-day holiday
* Egypt not worried by government's resignation
By Raya Atallah and Nadia Saleem
DUBAI, Feb 24 (Reuters) - Saudi Arabia's bourse rose to a 67-month high on Monday as investors shifted funds towards real estate shares, while most other regional markets closed on a positive note.
The Saudi real estate sector's index gained 3.7 percent; developer Jabal Omar jumped 5.5 percent. Investors tend to shift from blue chips after earnings season towards other sectors that may have more upside.
Petrochemical shares edged up with Saudi Basic Industries Corp (SABIC) climbing 0.2 percent."
'via Blog this'
Monday 24 February 2014
EconoMonitor : EconoMonitor » Gazprom’s Next Acquisition: Algeria?
EconoMonitor : EconoMonitor » Gazprom’s Next Acquisition: Algeria?:
"Russia’s oil and natural gas state monopoly Gazprom has been offered joint venture exploration projects in Algeria, the first foreign company to be invited to work in the country. The offer was discussed at a meeting between Gazprom officials and the Algerian government earlier last week. Gazprom will participate in an international tender for the exploration and development of more than 30 prospectivehydrocarbon deposits amounting to an estimated 20 percent of Algeria’s territory. Gazprom’s overseas branch, Gazprom International, is already operating in Algeria, developing al-Assel oil and gas field in the east of the country in cooperation with Algeria’s Sonatrach. Sonatrach holds the state monopoly for natural gas exports."
'via Blog this'
"Russia’s oil and natural gas state monopoly Gazprom has been offered joint venture exploration projects in Algeria, the first foreign company to be invited to work in the country. The offer was discussed at a meeting between Gazprom officials and the Algerian government earlier last week. Gazprom will participate in an international tender for the exploration and development of more than 30 prospectivehydrocarbon deposits amounting to an estimated 20 percent of Algeria’s territory. Gazprom’s overseas branch, Gazprom International, is already operating in Algeria, developing al-Assel oil and gas field in the east of the country in cooperation with Algeria’s Sonatrach. Sonatrach holds the state monopoly for natural gas exports."
'via Blog this'
Russia will honor all legally binding agreements with Ukraine - Medvedev #EuroMaidan
Russia will honor all legally binding agreements with Ukraine - Medvedev:
"Russian will honor all the agreements it signed with Ukraine, Russian Prime Minister Dmitry Medvedev said.
"Those agreements which are legally binding must be honored. We are not cooperating with personalities or isolated individuals. These are inter-state relations," Medvedev said in Sochi, responding to a question posed by Interfax."
'via Blog this'
"Russian will honor all the agreements it signed with Ukraine, Russian Prime Minister Dmitry Medvedev said.
"Those agreements which are legally binding must be honored. We are not cooperating with personalities or isolated individuals. These are inter-state relations," Medvedev said in Sochi, responding to a question posed by Interfax."
'via Blog this'
UAE Has No Plans To Tax Individuals – Finance Minister » Gulf Business
UAE Has No Plans To Tax Individuals – Finance Minister » Gulf Business:
"The UAE has no immediate plans to impose tax on individuals, Sheikh Hamdan Bin Rashid Al Maktoum, Dubai’s deputy ruler and Minister of Finance has confirmed.
However, the ministry has been conducting studies on the economic effects of levying taxes on companies, official news agency WAM quoted him as saying.
It is also mulling the imposition of fees for newly introduced services at federal ministries and bodies, Sheikh Hamdan said.
The ministry is also considering imposing taxes on certain harmful goods such as tobacco products. “The ministry is committed to announcing any taxes once an agreement is reached with relevant and concerned parties,” he said."
'via Blog this'
"The UAE has no immediate plans to impose tax on individuals, Sheikh Hamdan Bin Rashid Al Maktoum, Dubai’s deputy ruler and Minister of Finance has confirmed.
However, the ministry has been conducting studies on the economic effects of levying taxes on companies, official news agency WAM quoted him as saying.
It is also mulling the imposition of fees for newly introduced services at federal ministries and bodies, Sheikh Hamdan said.
The ministry is also considering imposing taxes on certain harmful goods such as tobacco products. “The ministry is committed to announcing any taxes once an agreement is reached with relevant and concerned parties,” he said."
'via Blog this'
Hryvnia devaluating on Monday on interbank #EuroMaidan
Hryvnia devaluating on Monday on interbank:
"Quotations on the interbank currency market on Monday are actively falling from the opening of trading and reached UAH 9.24-9.40/$1 as of 1155, while on the previous working day they stood at UAH 9.10-9.18/$1, dealers of commercial banks said.
Market operators said that the NBU has not entered the market.
As reported, at the end of last week the previous government was overthrown in Ukraine: the Ukrainian president left the capital and is now wanted for mass murder. Protesters and opposition have started forming a new government."
'via Blog this'
"Quotations on the interbank currency market on Monday are actively falling from the opening of trading and reached UAH 9.24-9.40/$1 as of 1155, while on the previous working day they stood at UAH 9.10-9.18/$1, dealers of commercial banks said.
Market operators said that the NBU has not entered the market.
As reported, at the end of last week the previous government was overthrown in Ukraine: the Ukrainian president left the capital and is now wanted for mass murder. Protesters and opposition have started forming a new government."
'via Blog this'
fastFT: ECONOMYUkrainian bail-out games begin with $35bn gambit #EuroMaidan
fastFT: ECONOMY Ukrainian bail-out games begin with $35bn gambit:
"The Ukrainian finance ministry has announced that it is seeking financial aid of about $35bn over the next two years and is in talks with the US and Poland for quick bilateral loans that could come within the next two weeks.
In a statement on its website, the finance ministry also said it is hoping to hold a "big international donor conference" with EU countries, the US, the International Monetary Fund "and other financial institutions".
It also said that Ukraine now wants to implement the EU integration treaty rebuffed by ousted president Victor Yanukovich. The failure to sign the pact at a summit in Vilnius touched of the months of protests that eventually led to Mr Yanukovich's ouster."
'via Blog this'
"The Ukrainian finance ministry has announced that it is seeking financial aid of about $35bn over the next two years and is in talks with the US and Poland for quick bilateral loans that could come within the next two weeks.
In a statement on its website, the finance ministry also said it is hoping to hold a "big international donor conference" with EU countries, the US, the International Monetary Fund "and other financial institutions".
It also said that Ukraine now wants to implement the EU integration treaty rebuffed by ousted president Victor Yanukovich. The failure to sign the pact at a summit in Vilnius touched of the months of protests that eventually led to Mr Yanukovich's ouster."
'via Blog this'
Rally in Ukrainian bonds: is it justified? | beyondbrics #EuroMaidan
Rally in Ukrainian bonds: is it justified? | beyondbrics:
"Ukrainian bonds are rallying strongly on Monday as investors digest the weekend’s dramatic events. Short term bonds issued by the sovereign and by Naftogas, the state gas company, have recovered from their recent panic levels.
But is there so much for investors to cheer about?
Chris Weafer of Macro-Advisory thinks not. He wrote on Monday:
Why? Because even if Ukraine’s new leadership manages quickly to secure a deal from the EU and the IMF to replace the $15bn package offered by Russia, it won’t be enough:"
'via Blog this'
"Ukrainian bonds are rallying strongly on Monday as investors digest the weekend’s dramatic events. Short term bonds issued by the sovereign and by Naftogas, the state gas company, have recovered from their recent panic levels.
But is there so much for investors to cheer about?
Chris Weafer of Macro-Advisory thinks not. He wrote on Monday:
After the news of Friday’s peace deal there was a rally in the value of the Hryvnia, in the UX Equity Index and in Ukraine debt prices. Those moves are not justified.
Why? Because even if Ukraine’s new leadership manages quickly to secure a deal from the EU and the IMF to replace the $15bn package offered by Russia, it won’t be enough:"
'via Blog this'
Arabtec 'in talks to buy Kuwait's Kharafi'
Arabtec 'in talks to buy Kuwait's Kharafi':
"Arabtec Holding, Dubai's largest listed construction firm, is in the advanced stages of talks to fully acquire a construction company in Kuwait's Kharafi Group, two sources aware of the discussions said.
The Dubai firm is in talks with Kharafi National, a Kuwait-based contractor and facilities management firm which has operations in several Middle Eastern countries, to buy all its assets and operations.
The deal, if completed, would be worth about 2 billion dirhams ($545 million), one source said. However, a report in the Abu Dhabi-based Al-Ittihad newspaper on Monday valued the possible deal at about 5.5 billion dirhams, it quoted unnamed sources."
'via Blog this'
"Arabtec Holding, Dubai's largest listed construction firm, is in the advanced stages of talks to fully acquire a construction company in Kuwait's Kharafi Group, two sources aware of the discussions said.
The Dubai firm is in talks with Kharafi National, a Kuwait-based contractor and facilities management firm which has operations in several Middle Eastern countries, to buy all its assets and operations.
The deal, if completed, would be worth about 2 billion dirhams ($545 million), one source said. However, a report in the Abu Dhabi-based Al-Ittihad newspaper on Monday valued the possible deal at about 5.5 billion dirhams, it quoted unnamed sources."
'via Blog this'
Islamic Finance on the Rise in North Africa - Middle East Real Time - WSJ
Islamic Finance on the Rise in North Africa - Middle East Real Time - WSJ:
"
The estimated $1.4 trillion global Islamic finance sector could be on the rise in North Africa where governments have been introducing new regulation as they seek shariah-compliant alternatives for decreasing conventional funding sources and try to plug current account deficits.
Tunisia and Egypt implemented new laws allowing for the issuance of Islamic bonds in late 2013, while Morocco last month put in place a legal framework for Islamic institutions, according to Standard & Poor’s.
Islamic finance activity is currently still very much concentrated in Southeast Asia and the Arab Gulf, so adding North Africa could broaden its geographical reach. North Africa’s contribution to global Islamic banking assets currently stands at a meager 1%, S&P said."
'via Blog this'
"
Tunisia and Egypt implemented new laws allowing for the issuance of Islamic bonds in late 2013, while Morocco last month put in place a legal framework for Islamic institutions, according to Standard & Poor’s.
Islamic finance activity is currently still very much concentrated in Southeast Asia and the Arab Gulf, so adding North Africa could broaden its geographical reach. North Africa’s contribution to global Islamic banking assets currently stands at a meager 1%, S&P said."
'via Blog this'
EconoMonitor : Ed Dolan's Econ Blog » Ukraine’s Crisis Threatens to Drag Russia’s Economy Down, Too | #EuroMaidan
EconoMonitor : Ed Dolan's Econ Blog » Ukraine’s Crisis Threatens to Drag Russia’s Economy Down, Too:
"Political events in Ukraine and diplomatic tensions with Russia are filling the headlines this week, but behind these recent developments is a story of persistent economic weakness. Although a change of government in Kiev may eventually bring needed reforms, in the short run it can only worsen the economic situation. Bloomberg reports that Ukraine’s interim president, Oleksandr Turchynov, has said that the country’s economy is “spinning out of control” and has entered a “pre-default situation.” All this raises the question of whether economic collapse in the Ukraine will drag the already faltering Russian economy down with it."
'via Blog this'
"Political events in Ukraine and diplomatic tensions with Russia are filling the headlines this week, but behind these recent developments is a story of persistent economic weakness. Although a change of government in Kiev may eventually bring needed reforms, in the short run it can only worsen the economic situation. Bloomberg reports that Ukraine’s interim president, Oleksandr Turchynov, has said that the country’s economy is “spinning out of control” and has entered a “pre-default situation.” All this raises the question of whether economic collapse in the Ukraine will drag the already faltering Russian economy down with it."
'via Blog this'
Ash looks at Ukraine’s road ahead after collapse of Yanukovych regime - Ukraine Business Online #EuroMaidan
Ash looks at Ukraine’s road ahead after collapse of Yanukovych regime - Ukraine Business Online:
'via Blog this'
2014/2/24 0:41:08
What is clear is that Ukraine will need external support - perhaps a USD20bn+ external support programme from the West, but channelled through the World Bank and IMF. Given prior commitments, and the clear strategic significance of ensuring a stable Ukraine, we think such Western financing will be forthcoming. However, we think that any such assistance will still be made conditional on a coherent set of economic reform policies being put in place. We would include therein the already detailed set of conditions identified by the IMF, including exchange rate flexibility, energy sector reform (read gas price hikes), and fiscal consolidation.
LONDON, Feb 24, 2014 (UBO) – At the end of probably the most remarkable week in Ukraine’s history as an independent nation, Standard Bank chief emerging market economist Timothy Ash casts his eye on the road ahead:
-------------------------------------------------------------------------------
The above commentary represents a personal view, is not investment advice or Standard Bank research, but may contain extracts from published research.
LONDON, Feb 24, 2014 (UBO) – At the end of probably the most remarkable week in Ukraine’s history as an independent nation, Standard Bank chief emerging market economist Timothy Ash casts his eye on the road ahead:
A truly remarkable few days in Ukraine, with the country appearing on the brink of Civil War earlier in the week, then a last ditch attempt by the EU at a peace deal on Friday morning, which at first glance did not appear to go far enough in terms of concessions to the opposition, and then finally the total collapse of the Yanukovych regime through Friday evening and into Saturday.
In parliament support for the former Regions party collapsed, and this allowed the opposition to secure a constitutional majority of over 300. They took no chances and speedily pushed through legislation which brought back the 2004 constitution, shifting power from the presidency to parliament, then voted to oust key Yanukovych ministers, including the hated minister of interior, Vitaly Zakharchenko - seen as directly responsible for the deaths on Maidan over the past few months, and then voted to impeach now former President Yanukovych. Yanukovych had already fled the capital, to an unknown destination, but border guards are reported to have prevented him and some of his henchmen (including Zakharchenko) leaving the country. Parliament also voted to free former Prime Minister, Yulia Tymoshenko (jailed in 2011 on spurious charges) and appointed her Fatherland Party colleague, Oleksandr Turchynov, as speaker of parliament and then acting President, pending fresh presidential elections called for May 25, 2014. Tymoshenko subsequently appeared at a mass rally on Saturday evening having been sprung from her jail cell in Kharkiv earlier in the day - reported also to be the hiding police of former President Yanukovych.
The above represents a truly remarkable turnaround in events, if comments attributed to the Polish foreign minister, are to be believed, I.e. warning opposition leaders late Thursday evening that if they did not sign the deal with Yanukovych that they would all be dead. Instead, they are now in total control, and Yanukovych is on the run.
Parliament is slated to remain in session this week, and is expected to approve the appointment of a coalition government to take the country to early elections, and perhaps even agree the signing of the AA/DCFTA with the EU - Yanukovych's failure to sign this at the Vilnius summit back in November was the spark that led to mass protests and his subsequent ousting.
Why did the regime suddenly collapse, after months of resolute stonewalling?
My sense is that this was a combination of factors, but key was the extremity of violence used against demonstrators over the past week. The picture of police snipers picking off demonstrators was truly chilling - almost akin to death squads, committing premeditated murder. The sheer scale of the deaths - scores killed this week also appeared to be a turning point. This then set in motion the application of sanctions by the West which will have hurt allies of the regime, and there was further evidence of defections from the ruling Regions faction, and from the police/security services. The fact that Yanukovych showed his willingness to accept the EU3 brokered deal by which in effect he surrendered most of his powers, left him further exposed. The fact that Maidan failed to agree to the terms of this deal - signed by opposition leaders - and threatened to remove him then by force by 10am the following morning (Saturday) was the final blow for Yanukovych, who then fled Kyiv. And his fate was then sealed.
So what next for Ukraine?
The new administration faces numerous challenges. First cobbling together a coalition government to take the country to early elections, and remaining unified in the face of very significant domestic and external threats. Second, averting secessionist tendencies. Third, managing relations with Russia - assuming the decision is taken to sign the AA/DCFTA and hence opt for a European orientation. Fourth, grappling with an acutely challenging economic situation. If policy makers negotiate through this substantial list, then the country should have a good future.
On the issue of maintaining unity in the run up to elections, at face value this could be difficult, and especially after the past history of fractured Ukrainian Orange politics, e.g. the near self-destruct relationship between former President Viktor Yushchenko and Yulia Tymoshenko. However, what has been incredibly encouraging is the way that the unity of the three main opposition leaders - Klitschko, Yatsenyuk and Tiahnybok - held together through the crisis, and particularly in recent days. They also carried through on their pledge to free Yulia Tymoshenko at the first opportunity. They appear to have agreed that Turchynov will assume a temporary leadership role in the run up to elections - perhaps a reflection of his own experience heading the SBU under Yulia Tymoshenko. Of particular note perhaps, Yulia Tymoshenko, has rejected calls for her to become prime minister, albeit she is expected to run in the looming presidential elections. This does still raise the spectre of the opposition slugging it out in the presidential election, with multiple candidates, but we would expect the campaign between opposition leaders to be relatively tame, given what the country has already been through and given the challenges still faced, particularly on the external front. And, importantly, the reversion to the 2004 constitution denudes the role of president, with the government and parliament assuming a greater role. The position of prime minister, hence, becomes the dominant role - albeit we saw in the Yushchenko/Tymoshenko era that a good relationship between the two positions is still very important.
The threat of secession should be taken seriously, given the deep divides which opened up across the country through the past few months, with some opposition Western regions of Ukraine refusing to abide by the writ of Kyiv. There have even been threats by regions in Eastern Ukraine, traditionally a stronghold of the former ruling Regions party, to follow a similar tact with a new opposition administration in Kyiv. Moscow has warned that is will monitor the situation closely, and has even suggested that it might even have to intervene if the interests of ethnic Russians in the South and East of the country are not being adequately protected.
However, a number of actions in the past few days makes me less concerned over an immediate deepening in secessionist tendencies in Ukraine. First, the reaction of Eastern regions in Ukraine to the ousting of President Yanukovych has been calm/muted. This probably reflects the fact that the bulk of the Ukrainian population saw the former Yanukovych regime as corrupt, and little more than a "bandit" regime - this was evident in the collapse in poll ratings for Regions in the period since the 2010 presidential elections. Hence, and despite what Moscow and the Yanukovych regime had implied in self defence, Maidan was not a protest movement based on ethnicity, but it was a protest against unjust and corrupt rule. And the corrupt nature of the former Yanukovych regime was laid bare over the past few days after the capture of the former President's opulent country estate which could not have been afforded on his meagre public salary. Claims are that the "Family" stole billions of dollars through its position of patronage - and they now look set to be brought to account for this. Second, one of the first laws passed by parliament following the ousting of Yanukovych was a law against secessionist tendencies. This should rein all sides in. Third, it was particularly encouraging that the remnants of the Regions party issued a statement earlier today blaming Yanukovych for the violence, and mis-governance. The shear extent of graft, and violence used by the regime, seems to be encouraging remaining Regions members to show their loyalty to the new regime, and there seems little appetite to support any call for secession in Southern and Eastern regions of Ukraine. Fourth, I would contend that these secessionist tendencies in Eastern Ukraine were already weak, as the division of Ukraine would likely inevitably see their domination by Moscow, something which the vast majority of Ukrainian people and oligarchs alike simply do not want. Over the past twenty three years they have grown to appreciate independence - and many young Ukrainians have known nothing else.
The third major challenge for the new Ukrainian administration will be managing relations with Moscow. Moscow staked a huge amount in the end on the Yanukovych regime - backing the former president with a USD15bn+ bailout programme, calling the Maidan extremists coup plotters, and calling on Yanukovych to restore order. Many view Moscow behind Yanukovych's last ditch decision to stall on signing the AA/DCFTA with the EU at the Vilnius summit, as that would have his scuppered own vision for creating a CIS Customs Union that had any meaning or significance. As is, that vision now lies in tatters, and President Putin has now arguably suffered his most significant foreign policy defeat in a decade - since the first Orange revolution. If Russian TV commentary over the past few days is anything to go by, the Putin regime is now feeling extremely bitter. The question is could this bitterness produce any significant counter reaction? Herein, fears of a direct Russian military intervention in South and Eastern Ukraine, perhaps starting with the Crimea, seem to have faded with the lack of any significant popular reaction in these regions to the ousting of Yanukovych, and the disintegration of the Regions party itself. However, Moscow has a very significant ability to inflict damage on the Ukrainian economy, by disrupting trade ties (as in the lead up to the Vilnius summit), by perhaps causing problems in gas supply through Ukraine to Europe, and also via its ability to call in debts owed by Ukraine to Russian entities. On this latter issue, what seems now fairly clear is that there will be no further disbursements under the bail bond programme agreed in December 2013, but which has only disbursed USD3bn in credits thus far. Potentially though Russia could extract leverage via gas debts (estimated at around USD2-3bn) and there is now little hope that Ukraine will secure cheap Russian gas as per the December 2013 agreement. I tend to doubt though that Russia will seriously contemplate disrupting gas supplies through Ukraine to Europe, as arguably Russia ultimately loses herein as it shows itself as an unreliable partner for Europe in gas supply and encourages further diversification away from Russia by key European consumers. Perhaps also important is the fact that the annual heating season is drawing to a close and hence the ability to maximise the impact of gas supply disruption is reduced.
The economy is the fourth major challenge for the new rulers in Kyiv, and strains in the relationship with Moscow will likely just make a difficult situation even worse. To recap, the Ukrainian economy remains on the brink of recession - only posting flat real GDP growth in 2013, and recent political unrest may have pushed the economy back into recession. The budget has been running in large deficit, again likely made worse by recent demonstrations, as all sides probably stalled in paying taxes. We estimate the budget deficit to be in the order of 7-8% of GDP, while the Treasury has nearly no fiscal cash reserve, and has been living by "robbing Petro, to pay Viktor". The external accounts are also in a mess. Despite flat real GDP growth the current account ran in deficit of around 8-9% of GDP last year, suggesting the exchange rate is significantly overvalued, and reflected by the marked depletion of NBU FX reserves - halving over the past two years to just over two months of import cover. A weight of external liabilities fall due over the next year - USD68bn, and we estimate an external financing gap of USD15-20bn. This gap will likely need to be closed via a combination of exchange rate adjustment, and deflation, plus the provision of significant external financing.
We would also add herein that the above FX reserve data/financing equation makes no account for potential reserve depletion in the final few days of the Yanukovych regime - the fear surely is that the regime could have plundered the official accounts, perhaps with the intention of running a parallel administration out of Eastern Ukraine. We would perhaps also express some caution herein over the health of the banking sector, for similar reasons - many former regime friendly banks may now be shells, with significant holes in their balance sheets.
What is clear is that Ukraine will need external support - perhaps a USD20bn+ external support programme from the West, but channelled thought the World Bank and IMF. Given prior commitments, and the clear strategic significance of ensuring a stable Ukraine, we think such Western financing will be forthcoming. However, we think that any such assistance will still be made conditional on a coherent set of economic reform policies being put in place. We would include herein the already detailed set of conditions identified by the IMF, including exchange rate flexibility, energy sector reform (read gas price hikes), and fiscal consolidation. However, given the severity of the crisis which Ukraine has just been through we think that the nation will now be braced to undertake significant reforms and now should be a very opportune time to embark on landmark reforms which could well set the stage for a transformation in the Ukrainian economy. In some respects we might argue likely external pressure exerted on Ukraine by Russia will likely make it that much easier for the administration to sell the need for difficult but much needed reforms to the population - the economy is also in such a mess because of the mismanagement of the former administration.
We would add a couple of additional important points as to the reform agenda:
First, Ukraine does have a critical mass of reform minded politicians and officials. We would include herein, opposition leaders Yatsenyuk (a former central bank governor, and minister of economy) and Petro Poroshenko (former head of the NBU council). It is, however, very difficult to see Yanukovych place men, e.g. Incumbent NBU governor Sorkin, remaining in position. That said the NBU does have a number of credible technocrats who would be expected to stay, including the current deputy NBU governor, Mykola Udovichenko. It is not too difficult to imagine an economic reform team perhaps comprising Yatsenyuk as first deputy PM for finance and the economy, and Poroshenko as NBU governor - or indeed vice a versa.
Second, the energy sector remains important, indeed key. It might just be possible still to keep elements of Regions with coverage for this sector, and perhaps to try and ensure stable energy sector relations with Moscow. In this respect we assume that the Boyko/Firtash axis will still be working overtime to maintain an interest therein.
Third, it remains to be seen how a new Ukrainian administration, and official creditors, would deal with private sector creditors, particularly those which in effect have been bank rolling the former Yanukovych regime. The moral hazard issue herein was particularly relevant when it came to Ukraine, as the Yanukovych's administrations ability to borrow from the market over the past 2-3 years meant that it spurned entering into a formal relationship with the IMF and key reforms were delayed. Official creditors may also be loathed to be seen to so publicly bail out large private sector creditors who took high stakes bets in Ukraine, and on the assumption that it was "too big to be allowed to fail".
Hence, perhaps as part of any Western support package limits on borrowing from the market might be agreed, or this might even extend to some formal bailing in of creditors. The latter might be forced, depending on developments on the exchange rate front, the banking sector, realisation as to how bad the real accounts are when the new government takes office, and perhaps developments in terms of the relationship with Moscow, e.g. whether Moscow pushes for early repayment of liabilities. In the latter scenario a new administration might seek to re-profile its debt liabilities at the outset, so as to get ahead of the curve.
The above commentary represents a personal view, is not investment advice or Standard Bank research, but may contain extracts from published research.
'via Blog this'
IMF tackles sovereign debt restructuring - YouTube
IMF tackles sovereign debt restructuring - YouTube:
"The International Monetary Fund is looking at sovereign debt restructuring, worried that it is bailing out private creditors. Gabriel Sterne, an economist at Exotix, explains to Fast FT deputy editor Robin Wigglesworth why the proposal for automatic bail-ins would not be wise.
"
'via Blog this'
"The International Monetary Fund is looking at sovereign debt restructuring, worried that it is bailing out private creditors. Gabriel Sterne, an economist at Exotix, explains to Fast FT deputy editor Robin Wigglesworth why the proposal for automatic bail-ins would not be wise.
"
'via Blog this'
Dubai’s Union Properties to lift foreign ownership cap to 25 per cent | The National
Dubai’s Union Properties to lift foreign ownership cap to 25 per cent | The National:
"Dubai’s Union Properties said on Monday that its board of directors had recommended increasing the cap on how much foreign investors can own in the developer to 25 per cent.
The firm did not say from what level it was raising the limit in its statement to the Dubai stock exchange. Foreigners currently own 4.35 per cent of the company, according to bourse data.
It is the latest move by companies in the UAE and Qatar to raise their limits on foreign ownership ahead of the upgrading of their countries to emerging market status by index provider MSCI in May."
'via Blog this'
"Dubai’s Union Properties said on Monday that its board of directors had recommended increasing the cap on how much foreign investors can own in the developer to 25 per cent.
The firm did not say from what level it was raising the limit in its statement to the Dubai stock exchange. Foreigners currently own 4.35 per cent of the company, according to bourse data.
It is the latest move by companies in the UAE and Qatar to raise their limits on foreign ownership ahead of the upgrading of their countries to emerging market status by index provider MSCI in May."
'via Blog this'
Emirates safe from Qantas’ losses, Australian state politician says | GulfNews.com
Emirates safe from Qantas’ losses, Australian state politician says | GulfNews.com:
"Fears that Qantas will cut as many as 3,000 jobs in the coming weeks will not have any impact on its Emirates partnership, said an Australian state politician.
Louise Asher, a member of government of the Australian state of Victoria, said Emirates is isolated from any ripple effect in the fallout of Qantas’ half-year financial results to be released this week.
Asher, Victoria’s Minister for Innovation, Services and Small Businesses and Minister for Tourism and Major Events, is in the UAE leading a trade delegation of 110 Victorian companies."
'via Blog this'
"Fears that Qantas will cut as many as 3,000 jobs in the coming weeks will not have any impact on its Emirates partnership, said an Australian state politician.
Louise Asher, a member of government of the Australian state of Victoria, said Emirates is isolated from any ripple effect in the fallout of Qantas’ half-year financial results to be released this week.
Asher, Victoria’s Minister for Innovation, Services and Small Businesses and Minister for Tourism and Major Events, is in the UAE leading a trade delegation of 110 Victorian companies."
'via Blog this'
AXA to take major stake in UAE’s Green Crescent Insurance | GulfNews.com
AXA to take major stake in UAE’s Green Crescent Insurance | GulfNews.com:
"French insurance giant AXA Group and its partner in the UAE, Kanoo Group, plan to become major shareholders in the UAE’s Green Crescent Insurance Co (GCIC), GCIC said on Sunday.
The firm has called a shareholder meeting on March 26 “to consider resolutions to expand the capital base of GCIC and forge a long-term strategic alliance with AXA Group and its UAE partner, the Kanoo Group”, it said in a statement."
'via Blog this'
"French insurance giant AXA Group and its partner in the UAE, Kanoo Group, plan to become major shareholders in the UAE’s Green Crescent Insurance Co (GCIC), GCIC said on Sunday.
The firm has called a shareholder meeting on March 26 “to consider resolutions to expand the capital base of GCIC and forge a long-term strategic alliance with AXA Group and its UAE partner, the Kanoo Group”, it said in a statement."
'via Blog this'
Ukraine Bond Rally Seen Tied to Fresh Aid Amid Default Concerns - Bloomberg
Ukraine Bond Rally Seen Tied to Fresh Aid Amid Default Concerns - Bloomberg:
"With Ukraine’s new leaders saying the economy is in peril and a debt default possible, bond investors are looking for clues that fresh aid is on its way.
The nation’s benchmark dollar debt due in April 2023 posted its biggest rally in two months on Feb. 21, before lawmakers ousted Viktor Yanukovych as president and handed his powers to new parliamentary speaker, Oleksandr Turchynov.
While the removal of Yanukovych raises the prospect of an end to clashes that killed dozens last week and plunged the $176 billion economy into turmoil, it raises the question of how Ukraine will shore up its currency and repay debt. The U.S., Europe and U.K. have said they’re prepared to offer aid. Russian Finance Minister Anton Siluanov said last week the situation in the former Soviet republic must stabilize before it gets more of the $15 billion promised in December."
'via Blog this'
"With Ukraine’s new leaders saying the economy is in peril and a debt default possible, bond investors are looking for clues that fresh aid is on its way.
The nation’s benchmark dollar debt due in April 2023 posted its biggest rally in two months on Feb. 21, before lawmakers ousted Viktor Yanukovych as president and handed his powers to new parliamentary speaker, Oleksandr Turchynov.
While the removal of Yanukovych raises the prospect of an end to clashes that killed dozens last week and plunged the $176 billion economy into turmoil, it raises the question of how Ukraine will shore up its currency and repay debt. The U.S., Europe and U.K. have said they’re prepared to offer aid. Russian Finance Minister Anton Siluanov said last week the situation in the former Soviet republic must stabilize before it gets more of the $15 billion promised in December."
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Iran to Pay Higher Fees for Riskier Oil Fields in New Contracts - Bloomberg
Iran to Pay Higher Fees for Riskier Oil Fields in New Contracts - Bloomberg:
"Iran will offer foreign partners incentives to find and pump more crude and natural gas and will pay some fees in barrels as it seeks to boost income once international sanctions are lifted.
New contracts Iran is developing will offer higher fees for riskier exploration and production projects, oil-ministry officials said at a conference in Tehran yesterday. Local and international executives attended a two-day meeting to discuss rules that would govern oil and gas production if Western curbs on Iranian energy exports are removed. The committee revising the Islamic republic’s contract model presented terms called the “Iran Petroleum Contract.”
“We’ve analyzed all the contracts in the market right now, all available beneficial models, and this is what we’ve come up with,” Mehdi Hosseini, a government energy adviser who leads the ministry committee, said at the conference. “This is a good model, with flexibility.”"
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"Iran will offer foreign partners incentives to find and pump more crude and natural gas and will pay some fees in barrels as it seeks to boost income once international sanctions are lifted.
New contracts Iran is developing will offer higher fees for riskier exploration and production projects, oil-ministry officials said at a conference in Tehran yesterday. Local and international executives attended a two-day meeting to discuss rules that would govern oil and gas production if Western curbs on Iranian energy exports are removed. The committee revising the Islamic republic’s contract model presented terms called the “Iran Petroleum Contract.”
“We’ve analyzed all the contracts in the market right now, all available beneficial models, and this is what we’ve come up with,” Mehdi Hosseini, a government energy adviser who leads the ministry committee, said at the conference. “This is a good model, with flexibility.”"
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Abu Dhabi’s Senaat Said to Seek Approval for Listing This Year - Bloomberg
Abu Dhabi’s Senaat Said to Seek Approval for Listing This Year - Bloomberg:
"Abu Dhabi’s Senaat, which owns companies including National Petroleum Construction Co., is seeking approval from the emirate for an initial public offering this year, two people familiar with the matter said.
The deal is awaiting a decision from the Abu Dhabi Executive Council, which may take about a month, the people said, declining to be identified because the matter isn’t public. The council is the emirate’s local executive authority with the power to make all project-related decisions such as negotiations and change orders, according to its website.
Senaat, which hired HSBC Holdings Plc (HSBA) and JPMorgan Chase & Co. (JPM) for the IPO last year, plans to sell shares in the second half or early 2015, according to the people. The company will list the shares on the Abu Dhabi Securities Exchange, one of the people said. A spokeswoman for Senaat declined to comment, as did a JPMorgan spokeswoman."
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"Abu Dhabi’s Senaat, which owns companies including National Petroleum Construction Co., is seeking approval from the emirate for an initial public offering this year, two people familiar with the matter said.
The deal is awaiting a decision from the Abu Dhabi Executive Council, which may take about a month, the people said, declining to be identified because the matter isn’t public. The council is the emirate’s local executive authority with the power to make all project-related decisions such as negotiations and change orders, according to its website.
Senaat, which hired HSBC Holdings Plc (HSBA) and JPMorgan Chase & Co. (JPM) for the IPO last year, plans to sell shares in the second half or early 2015, according to the people. The company will list the shares on the Abu Dhabi Securities Exchange, one of the people said. A spokeswoman for Senaat declined to comment, as did a JPMorgan spokeswoman."
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Ukraine Interim Leader Warns of Economic Danger - Bloomberg #EuroMaidan
Ukraine Interim Leader Warns of Economic Danger - Bloomberg:
"Ukrainian parliament Speaker Oleksandr Turchynov, handed presidential powers as lawmakers prepare to form a coalition government, warned that the economy was in a “pre-default situation.”
Lawmakers in Kiev worked on reshaping government after ousting Viktor Yanukovych from the presidency for a role in the violence that killed at least 82 people last week. The U.S. and the European Union pledged aid for a new cabinet. Border guards stopped Yanukovych at an airport in the eastern city of Donetsk two days ago. He wasn’t detained.
With protesters in control of the capital and Yanukovych denouncing events as a “coup d’etat,” his opponents face a contentious period after the release from prison of opposition leader Yulia Tymoshenko. Jailed more than two years ago for abuse of power, she vowed to return to the fractured political scene before presidential elections on May 25."
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"Ukrainian parliament Speaker Oleksandr Turchynov, handed presidential powers as lawmakers prepare to form a coalition government, warned that the economy was in a “pre-default situation.”
Lawmakers in Kiev worked on reshaping government after ousting Viktor Yanukovych from the presidency for a role in the violence that killed at least 82 people last week. The U.S. and the European Union pledged aid for a new cabinet. Border guards stopped Yanukovych at an airport in the eastern city of Donetsk two days ago. He wasn’t detained.
With protesters in control of the capital and Yanukovych denouncing events as a “coup d’etat,” his opponents face a contentious period after the release from prison of opposition leader Yulia Tymoshenko. Jailed more than two years ago for abuse of power, she vowed to return to the fractured political scene before presidential elections on May 25."
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