Dubai: Family-owned GCC conglomerates are strong on credit quality and accounting standards, according to a report by Moody’s, the international rating agency. “Whilst financial transparency and conglomerate-type business strategies pose analytical challenges, such companies also frequently demonstrate hidden credit strengths,” said Moody’s Investors Service. Analysing the key characteristics and issues involved in assessing the credit strength of family-owned companies in the Middle East, Philipp Lotter, Moody’s Senior Credit Officer and author of the report, said, “The main analytical challenges in assessing the credit quality of family-owned companies in the GCC, where such groups are commonplace, are the ownership structure and the limited public financial disclosure.” Key areas Moody’s new report, titled ‘Family-Owned Corporates in the GCC, looks at four keys areas such as corporate structures, accounting and transparency issues, capital structure and liquidity and analytical considerations. According to Moody’s, many large family-owned or closely held companies in the GCC encompass diversified core operations, often comprising real estate, construction and energy activities complemented by large land banks and investment portfolios. As a result of closely-held corporations being not obliged to publicly report their results, the availability of public information can often be sketchy. To assess a company’s financial strength, Moody’s has so far relied on private annual accounts, often prepared under International Financial Reporting Standards and audited by international firms. Moody’s said the quality of information, and indeed companies’ willingness to share such information on a confidential basis, are often high. Moody’s observes that many companies in the GCC – whether closely held or publicly quoted – rely heavily on short-term funding, which often depends on the strength of their banking relationships rather than any contractual commitment. The use of uncommitted lines to meet potential short-term liquidity needs remains a source of some uncertainty. Source : El watan
London: Britain’s largest bank is closing the doors of one of its branches – but only to poorer customers. The HSBC in the well-heeled area of Canford Cliffs, near Poole in Dorset, will only offer cashier services to richer clients from June 11. Anyone else will have to make do with cash machines. The branch lies close to the Sandbanks area overlooking Poole Harbour which boasts some of the most expensive property prices in Britain outside London. To be eligible for face-to-face banking services at the branch, customers will have to fall into its “premier” category, which means they will have to have savings of at least £50,000 or a £200,000 mortgage. Alternately, they must have a £100,000 mortgage plus a salary of £75,000-plus. HSBC – which promotes itself as “the world’s local bank” – said all customers would still be able to deposit cash, cheques and coins at “express” terminals within the branch and withdraw cash. Premier status But those who do not qualify for premier status will have to pay a fee of £19.95 per month to use cashier services – such as opening a current account or applying for a mortgage. A spokesman said the group had a “unique” situation in the area, with three branches in a radius of around two miles. It has a branch in Westbourne one mile away and another in Poole just over two miles away, both of which will remain full-service branches. The spokesman said: “We’re not banning the poor – that’s utterly untrue. “What we’re recognising is that, in this area, we have a unique situation: we have a high proportion of ‘premier’ customers who have more complex needs and warrant a premier service. “We have other branches that are very close that can service the other needs of customers who aren’t ‘premier’ customers.” He added that the banking giant had no plans to convert other branches to offer face-to-face banking to premier customers only. However, Canon Jeremy Oakes, vicar of the parish of Canford Cliffs and Sandbanks – whose church also banks at the branch – said many elderly parishioners with mobility problems would find it “very difficult indeed” to use the two other branches. Source : Glfnews
DUBAI (ArabianBusiness.com) — Dubai Flower Center (DFC) is to serve as a center for exporting flowers from Central Asia and Iran. These states want to boost their export activities into Europe and the Far East, according to DFC marketing director Ibrahim Ahli. Representatives from the flower center recently visited Central Asia to generate interest from the region, particularly from companies operating in Iran, which currently possesses 3,000 flower production units. The country also produces more than 1,486 million stems of cut flowers, 38 million pot plants and 120 million trees and shrubs every year, which could prove potentially lucrative for facilities such as Dubai Flower Center. “Central Asian and Iranian flower exporters can greatly benefit from the proximity of Dubai and its excellent infrastructure including DFC’s cool supply chain, which offers the ideal solution for transhipment of perishable cargo from these regions,” said Ahli. “DFC already houses international operators offering various services, which could immensely help countries from the region to increase their exports, especially with our capacity of 180,000 tons per annum,” he added. Iran is famous for its diverse floriculture products, which include tulips, hyacinth, chrysanthemums, carnations and iris. However, with nearly one million stems wasted every day due to lack of storage facilities, the country is eyeing the technology found at DFC. DFC believes it can provide not only the logistical support the Iranian flower exports sector requires, but a strategic positioning for the PGCC market as well. By paying a 5% customs duty at DFC, Iranian companies would be able to send products directly to any PGCC countries. “We can assure the Iranian producers and exporters that DFC offers a free zone environment, with no customs duty for cargo in transit and our connectivity to global markets through more than 117 airlines operating from Dubai International Airport,” said Ahli. Iran is currently preparing to build four terminals in Mazandaran, Markazi, Khuzestan, and Teheran provinces. On completion, the terminals will be linked with hubs such as Dubai, Germany and the Netherlands. “We noticed an eagerness from the Iranian industry professionals and other officials to cooperate and participate to work towards improving logistical support for the exporters,” said Ahli. “The DFC, which has already established itself as one of the leading transhipment hub for perishable goods, can surely support the Iranian floriculture industry as we have the necessary infrastructure to meet their requirements.”
DUBAI — The Ministry of Labour (MoL) yesterday said the Human Rights Watch (HRW) report, suggesting that the country’s draft labour law falls far short of international standards insofar as protecting workers’ rights is concerned, is unfortunate as it does not reflect ground realities. A 15-page report released by the HRW at a Press conference yesterday urged the UAE government to revise the law to protect workers’ rights to organise themselves and bargain collectively. The report also said that the draft law should, among other things, cover such groups as domestic workers. Feedback In a statement, Dr Ali bin Abdullah Al Kaabi, Minister of Labour, said he appreciated the comments made by the HRW about the draft labour law in the UAE and the ministry would take them into consideration. He said the revised draft law has been placed on the Internet and is receiving feedback from relevant organisations. Public opinion The effort made by the MoL to seek public opinion about the revised draft labour law underscored its profound belief in the principle of transparency and the importance of taking views of all relevant parties, including HRW, into consideration, the minister added. Revised draft law Pointing out that the ministry was still receiving responses to the revised draft law, Dr Al Kaabi said, “Based on our values and keenness to grant workers their rights, we are going to thoroughly study all proposals.” Reiterating that the UAE has a clean record of protecting workers’ rights, he said the ministry would cover in its study the HRW’s proposals as well as opinions expressed by other parties. An earlier statement issued by the ministry said the HRW did not accurately reflect either the progress that had been made in addressing labour issues or the seriousness with which the government was dealing with these issues. However, the UAE government, the statement said, “welcomes constructive input and discussions from international bodies and organisations, with regard to the area of guest worker welfare in the country”. Sarah Leah Whitson, HRW’s Middle East Director, said the Labour Ministry’s request for comments on the draft law represented an important step towards reform and transparency in the UAE. “And we hope that the Labour Ministry takes advantage of this process to revise the serious flaws in its draft law.” She said the law failed to address a series of abuses against migrant workers, who comprise 95 per cent of the country’s workforce, and “are particularly at the risk of abuse”. Further, she claimed, in a blatant contravention of international standards, the proposed law contains no provisions on workers’ rights to organise themselves and bargain collectively and explicitly punishes striking workers. “The UAE must amend its draft law to respect workers’ rights to organise, bargain collectively and strike,” said Whitson, alleging that over the past one year, the authorities have been dealing with workers staging demonstrations, rather than addressing the poor working conditions that fuel labour unrest. She pointed out that the draft law also violates international standards by arbitrarily excluding from its purview all domestic workers employed in private households, public sector workers, security workers and most farming and grazing workers, leaving them vulnerable to exploitation. “The government should extend equal labour protection to domestic workers instead of reinforcing the discrimination they already face,” she said. Moreover, she said, the draft law discriminates against women workers and treats women workers as dependents rather than as competent adults with full and independent legal capacity. The draft labour law, she claimed, also fails to incorporate the 2001 Dubai Court of Cassation ruling that prohibits employers from confiscating employees’ passports. HRW officials also stressed the need for employment contracts and instructions to be made available to workers in a language they speak fluently to eliminate miscommunication of facts that further fuels the exploitation of migrant workers in the UAE. Besides, they said there is a need for the government to enforce its labour laws by providing effective penalties for violations and stringent punishment to employers. The current law continues to provide weak financial penalties of between Dh 6,000 and Dh 12,000 for employers found violating the law, they added. “The current fine of a few thousand dollars is no deterrent for employers with multi-million-dollar contracts,” said Whitson. Source : khaleedj
An official at the UAE’s Crescent Petroleum Company announced that the company has finalized a 10-month study on oil exploration in Iraq jointly with Iraqi officials, Iraq Directory reported Monday. He said that the Iraqi area to be included in the study is between the southern city of Basra and the borders of Kuwait. He added that the firm has also conducted studies on other Iraqi regions and has drawn up a development plan for the giant southern Ratawi field. The UAE Crescent Petroleum and the Iraqi Oil Exploration Company have signed several technical cooperation agreements since 2005 to encourage foreign companies to invest and develop Iraq’s oil sector. (Source: MENAFN.com)
Doha: The United Arab Emirates is the most competitive economy in the Arab world followed by Qatar and Kuwait, according to a World Economic Forum report released here yesterday. The report places four Gulf countries among the 40 most advanced econo-mies of the world. The UAE is ranked 29, Qatar 32, Kuwait 37th and Bahrain 39. While the UAE’s ranking remained unchanged compared to the 2005 report, Qatar and Kuwait have moved up from 34 and 36 respectively. But Bahrain is placed two ranks lower.
Dubai: Passenger throughput at Dubai International Airport, the busiest in the Middle East, crossed the eight million mark in the first quarter this year, an increase of 17.7 per cent over the corresponding period in 2006, a statement said. The airport handled a total of 8.15 million passengers from January to March, compared to 6.89 million in the corresponding period of 2006. January was the busiest month with 2.9 million passengers, while February was the slowest at just over 2.5 million passengers. With a total of 28.78 million passengers in 2006 the airport registered an increase of over 16 per cent over 2005. Passenger traffic is expected to reach 33 million this year and up to 60 million by 2010. The total tonnage of cargo handled during the period under review reached 362,919 tonnes against 334,329 tonnes during the first quarter of 2005, a substantial increase of 8.6 per cent. March was the busiest month for cargo with over 132,400 tonnes, while January and February had a marginal difference at just over 115,000 tonnes for both. There were a total of 63,494 aircraft movements during the period under review, an increase of 9.2 per cent over the first quarter of 2005. With over 21,922 aircraft movements, January was the busiest month, slightly over March (21,847) and February (19,725). Shaikh Ahmad bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman of Emirates Group, said that the report is very encouraging and will set the tempo for the remainder of the year. He noted that after a successful year throughout 2006, Dubai International Airport is looking forward to repeating the feat this year. “The region’s aviation sector is the world’s fastest growing, and Dubai being the regional hub for trade, tourism and aviation, a consistent increase in passenger throughput at DIA shouldn’t come as a surprise,” he added. Traffic registers 17.7% rise in first quarter An increase of 9 per cent in aircraft movement during the furst quarter of 2007- An increase of 17.7 per cent in passenger movement compared to the last year figures.- In terms of cargo, the growth is almost 9 per cent compared with last year.- A total of 115 scheduled airlines and 25 frequent charter airlines operating to 200 destinations.
Dubai: Emaar Properties announced yesterday it will sell the unsubscribed portion of its rights issue to those investors who had applied for more shares than their entitlement. Emaar offered a 1:1 rights issue to investors in August 2005 at Dh5 per share including Dh4 premium. The company had offered the flexibility of paying for the shares through four equal installments. It is now offering to sell that portion of the offering, which was not taken up by the rights holders. “The surplus shares are now being allocated to shareholders who requested more shares than their initial entitlement and who reflected such intention at the time,” Emaar said. While the shares will be sold at the same offer price of Dh5 per share, the company has not specified how many shares are available. Investors eligible for the offer will be notified directly by the company and the will have 30 days to settle the payments for the additional shares allocated.
Tokyo : Red tape, high business costs and local fear of foreign take-overs have all held Japan back in the race to win foreign investment, but this may start to change when new merger and acquisition (M&A) rules take effect in May. With Japan’s population and workforce forecast to fall by about 10 million and 13 million respectively over the next 20 years, the world’s second-largest economy will suffer unless more foreign direct investment (FDI) comes in, economists say. Productivity The country needs to raise its productivity by bringing in new technology and management know-how, they say. “An ageing of the society means everybody who is left working has to work a lot harder. So you need productivity,” said Robert Feldman, chief economist at Morgan Stanley Japan Securities Co. “If we don’t raise productivity, our living standards will fall,” he said. The government had aimed to double Japan’s foreign investment stock to 13.2 trillion yen ($111 billion) in 2006 from 6.6 trillion yen in 2001. But that figure is estimated to have reached only 11 trillion yen as of the end of last year, a mere 2.2 per cent of Japan’s gross domestic product. That compares with 13 per cent in the US, 33.5 per cent in the European Union, and 14.3 per cent in China as of 2005, according to the latest UN World Investment Report. “There are a number of issues that affect the willingness of foreigners to come here,” Feldman said. “Regulation is very complex; getting regulatory decisions takes a long time; and the rules are not clear. In the end, sometimes it’s just not worth it when it takes so much work and so much trouble to come.” As a result, Japan has missed out on the global upsurge in FDI, which has been fuelled by cross-border mergers and acquisitions between developed countries. But economists say the country needs such investment to revitalise Japanese industry, citing the success of Nissan. Revamp “Since [chief executive] Carlos Ghosn joined Nissan, it has facilitated restructuring in areas such as its dealer network, which couldn’t have been carried out by Japanese management,” said Shujiro Urata, an economics professor at Waseda University. Help may be at hand, though, as new Japanese M&A rules that take effect in May will enable foreign companies to buy Japanese firms with exchanges of shares using their Japanese units, in so-called “triangular mergers”. “We may see an increase in foreign companies taking over Japanese companies,” said Patrick Mohr, a strategist at Nikko Citigroup Ltd. “[It may] not be a dramatic increase but enough to keep the steam alive.” Defence: Companies adopt anti-buyout measures Sensing the threat of foreign takeovers, more and more firms have been adopting takeover defences. According to Kengo Nishiyama, senior strategist at Nomura Securities Co, 224 listed firms, or 5.7 per cent of all listed companies, had adopted anti-takeover steps by April 2, compared with just 27 back in 2005. That number will top 300 by around May, he said. – Reuters