22 novembre 2008 Par La Rando

Projects in Dubai to continue as scheduled

Nasser Al Shaikh, Director-General of Dubai Department of Finance, has stressed infrastructure projects in Dubai, including Roads and Transport Authority plans and the new airport in Jebel Ali, would continue as scheduled in Dubai Strategic Plan for 2015. He said due to the global financial crisis and new challenges that Dubai may face, there would be some postponements in real estate projects. However, he stressed the property projects that are under construction or have been announced would go ahead as planned. Al Shaikh said the Supreme Financial Committee studying challenges of the financial crisis would also study challenges facing Dubai Strategic Plan and introduce due revisions and amendments to the plan according to the new developments. « We were expecting a growth rate of 11 per cent annually until 2015, but with the current situation this will not be achieved. However, Dubai will continue to witness growth in its economy, but at lower rates. » He said the financial crisis would lead to essential changes in the business models around the world and the target of the committee is to make Dubai the first place to rebound when the recovery of the global economy starts. « There is no country immune to such crisis and we will continue to study its implications to deal with its expected impact, » he added. Al Shaikh acknowledged that there was a lack of transparency in the past and he promised to be open regarding the outcome of the committee’s work. He also announced that Dubai would revive and restructure a special panel, which was formulated 18 months ago to look at Dubai credit rating. « The work of this panel was inactive in the past because its rule was not critical and we had easy access to credit. Now, the panel has become critical and we will activate its performance next year, » he added. Regarding the UAE’s banks recovery plan of Dh70bn, Al Shaikh stressed the second instalment of the plan worth Dh25bn was under process at the Ministry of Finance and would be introduced by the end of next week. Mohamed Ali Alabbar, Chairman of the committee and also Chairman of Emaar Properties, is expected to reveal details of the committee’s work next week. Other members of the committee include Mohammed Al Gergawi, Minister of State for Cabinet Affairs, Mohammed Al Shaibani, Chairman of Dubai Islamic Bank, and Essa Kazim, Chairman of Borse Dubai. Mohamad Al Kady business24-7.ae

22 novembre 2008 Par La Rando

Dubai sets up financial panel

Dubai has set up a supreme financial committee to deal with its sovereign debt as well as challenges arising from the global financial crisis, a senior official said yesterday. Nasser Al Shaikh, Director-General of the Dubai Department of Finance, said the committee was established about eight weeks ago and would look at the various challenges posed by the crisis, including Dubai’s debt issues. At a bankers’ lunch organised by the UAE Bankers Forum he said Dubai still had a very strong credit position. « Many recent reports were confusing about the sovereign debt of Dubai, debt of government-owned companies, debt of government-controlled companies and the debt of private companies. They were calculating all these against Dubai’s GDP, » said Al Shaikh, adding: « Even if we accept this situation, they are also ignoring Dubai’s sovereign assets, which will be several times more than this total debt. » He said: « The committee is studying different categories of Dubai’s debt and will be dealing with sovereign debt, and the debt of government-owned and government-controlled companies. We will not be involved in the debt of private companies. » However, he said Dubai’s government would be ready to support any local company that may need help to refinance its debt. Al Shaikh said the committee would give its recommendations on ways to handle the financial crisis to His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. Mohamed Ali Alabbar, Chairman of the Committee and also Chairman of Emaar Properties, is expected to reveal details of the committee’s work next week. Other members of the committee include Mohammed Al Gergawi, Minister of State for Cabinet Affairs, Mohammed Al Shaibani, Chairman of Dubai Islamic Bank, and Essa Kazim, Chairman of Borse Dubai. Al Shaikh also refuted news that a global panel will advise Dubai regarding its debt. « There is only one committee – a local one. We are talking with bankers, credit rating agencies and the federal government, because there are some issues that Dubai cannot solve alone – such as in the banking and financial sector, which is supervised by the federal Central Bank. » Mohamad Al Kady business24-7.ae

17 novembre 2008 Par La Rando

National Bank of Fujairah chief executive resigns

National Bank of Fujairah (NBF) yesterday said that Steve Mullins has stepped down from the post of chief executive officer with immediate effect, while Tim Goddard and Chris Taylor will together act as joint interim CEO. NBF Deputy Chairman Easa Saleh Al Gurg said: « National Bank of Fujairah is an ambitious bank. Our potential is unmatched and we are uniquely positioned to develop from our strong position amongst the UAE banking community to be a bank of great substance and critical mass. « We will now conduct a thorough search to find an individual who shares this vision and ambition. I am delighted that Tim Goddard and Chris Taylor have agreed to act as joint interim CEO until we have a replacement. » business24-7.ae

17 novembre 2008 Par La Rando

Doha Bank seeks to issue shares to QIA

Doha Bank, Qatar’s third- biggest bank by assets, said yesterday it would seek shareholder approval to raise its capital by up to 20 per cent and give that stake to the country’s sovereign wealth fund, the Qatar Investment Authority (QIA). Shareholders would meet on December 21 to discuss the plan, which would involve issuing up to 34.45 million new shares to the QIA at the bank’s closing share price on October 12, Doha Bank said in a statement on the bourse website. The increase would happen in two phases, it added. The move follows ones by other Qatari banks, including Commercial Bank of Qatar and Qatar International Islamic Bank, which have sold stakes to the sovereign wealth fund. In October, the QIA launched a $5.3 billion (Dh19.4bn) plan to buy shares of listed banks to shore up investor confidence in banks, amid the global financial crisis. Doha Bank opened a representative office in Seoul, South Korea, as part of its expansion into Asia. Besides Seoul, the bank operates representative offices in Istanbul, Tokyo, Singapore, Shanghai, Bucharest, and London, Doha Bank said yesterday in a statement to the Qatari bourse website. Agencies

17 novembre 2008 Par La Rando

Etisalat eyes acquisitions

Etisalat is in an upbeat mood and is scouting for a number of deals in the region, Emirates Business has learnt. Ahmad Abdulkarim Julfar, Chief Operating Officer, said the company is set to take advantage of the global financial crisis and is eyeing regional acquisitions. « This financial crisis creates a good environment for opportunities so we will be looking at acquisitions in India, Middle East and North Africa, » he said on the sidelines of the Leaders in Dubai Forum yesterday. « We have invested in 16 countries with $11 billion (Dh40.3bn) investments in these countries. All these countries – including Egypt, Saudi, the UAE and India – have high potential growth. And we will continue to focus on these countries. » Asked if this would happen in the next 12 months, Julfar said: « If the opportunity exists, why not? » He did not single out a country and declined to say how much they would be earmarking for the acquisitions, but he said the firm is « cash-rich », and has about over $3bn cash position making financing not an issue. He added that etisalat can also have access to cashflows from other sources thanks to its « excellent cash position » and « excellent ratings ». « The telecom sector – a very-cash intensive sector – is always the last and least impacted during crisis because it is a very innovative and creative sector, » he said. « During these challenging times, we will see more innovation and productivity because of the pressure. Julfar said they expect the company’s revenue to continue to grow as more and more windows of opportunities open up. « There will be more opportunities coming up and we will be watching these opportunities. Once something comes up we will not hesitate and jump in and take advantage of the situation, » he added. Etisalat, which had 7.05 million mobile phone subscribers at the end of the third quarter this year, claims that its internet and broadband penetration in the country exceeds 60 per cent. It also has roaming agreements with more than 400 operators and has investments in Egypt, Saudi Arabia, Afghanistan, Indonesia and Pakistan and 10 African markets, including Nigeria, Sudan and West Africa. It posted a 19 per cent rise in third-quarter profit, meeting forecasts, as it added more users in home market and expanded abroad. Karen Remo-Listana business24-7.ae

17 novembre 2008 Par La Rando

Dubai Airport gets private aviation services centre

A new private aviation services centre at the Dubai International Airport will consolidate the importance of Dubai on the world travel map, said Sheikh Ahmed bin Saeed Al Maktoum, President of Dubai Civil Aviation Authority and Chairman of Emirates Group. He said the new centre will be a qualitative addition to the list of distinguished services provided by Dubai International Airport to this category of passengers and meet their aspirations according to standards that are difficult to be matched. The setting up of the centre according to the highest technical and operational standards meets ambitious strategies developed by Dubai Airports to provide anything that can consolidate the airport’s international reputation among passengers, especially businessmen, at local and international levels, he said. Sheikh Ahmed spoke at the unveiling of the new building and identity of the centre on the sidelines of the Middle East Business Aviation Show. The centre, built in the Dubai Airport Free Zone, extends on an area of 5,500 square metres. It consists of two floors equipped with all necessary services and facilities. It contains eight halls for VIPs. The centre, which works around the clock and is regarded the biggest of its kind in the Middle East, provides inspection points related to passports, customs, police and two e-Gate devices that the passengers can use if they want their travel via the airport to be quicker. The number of private planes in the region tops 300. This figure is projected to increase greatly over the next few years to meet growth rates in the travel of businessmen in the Middle East. Statistics issued by Dubai Airports reveal that Dubai International Airport posted a big growth in the movement of private aircraft. The number of trips jumped from 238 in 1988 to 1,888 in 2000 and to 9,432 in 2007, an increase of 29 per cent compared to 2006. Wam

17 novembre 2008 Par La Rando

MIS completes Middle East’s first jack-up rig

Sharjah based Maritime Industrial Services (MIS) has completed the first ever offshore jack-up rig to be constructed in the Middle East. The move is expected to boost the profile of MIS in the region and also position the Middle East as an upcoming market for jack-up rig new builds. The SeaWolf Oritsetimeyin (Hull 104), which is scheduled for actual delivery to the client in the coming days, is currently undergoing intensive commissioning and testing procedures before final delivery. Along with its sister rig the SeaWolf Onome, this rig is one of two offshore jack-up drilling rigs being built by MIS for SeaWolf Oilfield Services, the Nigerian drilling company, in contracts worth $254 million (Dh932m). « This is our first ever jackup rig and the first to be constructed in this region. Due to this, the task has not been easy and completion has been delayed due to the many challenges and stumbling blocks, » said MIS Managing Director Jerry Smith. « For a yard with no previous record in building new rigs, we consider this an exceptional feat – especially with a new design that has never been built before anywhere in the world. » Both SeaWolf rigs are of a Friede and Goldman Super Mod 2 design with 30,000 foot rated drilling depth and an operating water depth capability of about 300 feet, or 92 metres. The SeaWolf Onome, SeaWolf’s second jack-up rig under MIS’ construction, is scheduled for delivery to SeaWolf in February 2009. Jack-up rig are mobile offshore drilling platforms used in oil and gas drilling and commonly used in oil and gas producing countries in the region and elsewhere. The Middle East is among the regions with the highest demand for jack-up rigs due to a large number of oil and gas drilling activities. While the region has previously looked at foreign yards for new builds and repair for rigs, drilling companies are beginning to pay attention to local manufacturers. MIS expanded its business line in 2006 to include the construction of offshore jack-up drilling rigs and currently has a backlog worth $1 billion, with seven rigs under construction and due for delivery in 2009 and 2010. The first quarter of 2008 saw a high demand for offshore drilling rigs, spurred by the increasing global demand for oil, leading to further shortage of yard space at the MIS yard in Sharjah. This year alone, MIS took four orders in excess of $500m, and with its current order book for oilrigs full until 2010, the company is in the process of opening its order book for 2011. « The overwhelming demand has prompted us to look for space elsewhere since the existing yard space is not enough if we are to expand our capacity, » Kevin Hudson, MIS Group CEO told Emirates Business. This year, Mosvold Middle East Jackup placed orders for Hulls 106 and 108 and while Bahrain’s MENAdrill ordered for Hulls 109 and 110. Smith said the future for the jack-up rig market would remain brighter due to increasing demand and the phasing out of ageing fleet that would have otherwise caused an oversupply. Ashaba Abdul K Basti business24-7.ae

17 novembre 2008 Par La Rando

Dubai’s debt-to-GDP ratio low: DIC

Dubai’s debt is manageable and is far lower if compared to the debt-GDP ratios of other developed countries such as the UK, Germany and the US, according to Sameer Al Ansari, Executive Chairman and Chief Executive Officer of Dubai International Capital. In his remarks to the Leaders in Dubai forum yesterday, he said the resources are guaranteed to pay the emirate’s debt obligations, which are variably estimated at $47billion (Dh172bn) to $70bn. « The next years will be better as all the resources are there for repayment. A lot of those debts are from companies with commercial operations that are extremely successful and very profitable and with strong cash flows, » he said. According to Al Ansari, compared to other countries, « Dubai’s debt to GDP is one is to one and the UAE’s debt to GDP is one-third of the GDP. In the UK, debt is five times compared to GDP, in Germany it is three times, in the US it is three and a half times. » Al Ansari’s remarks complement Emaar Chairman Mohamed Alabbar’s recent statement in the World Economic Forum that the Government of Dubai is fully covered to service its debt for the next seven quarters. Experts at the forum exuded optimism that the Gulf will continue to grow, albeit at a slower rate, indicating that GCC is not in a crisis. « Do you even know the real picture? We are receiving winds of contagion from the West but we do not have the crises that are swirling Wall Street. The important thing is to look at profitability and the balance sheets of the banks and they will appear. If you want to disregard the profits made by the banks and focus on the negative side, it is not fair. We will weather this. This is not being self congratulatory but there is no point in looking at a glass which is half empty, » said Dr Muhammad Al-Jasser, Vice-Governor, Saudi Arabian Monetary Agency. « Let us not forget Dubai is the financial, commercial, trading, logistics and tourism sector for the whole region. The region has strong fundamentals and Dubai will continue to be at the epicentre of the region’s prosperity, » Al Ansari said. « Dubai’s success is commercial, using leverage and foreign investment, » he added. « Some of you would remember that in the 1960s the Ruler borrowed heavily from Kuwait to dress the Creek and set Dubai to be the international logistics centre. « Dubai has always been bold and has always been taking uncertainty to its advantage, providing a safe haven in the region for the region. » Earlier, investment bank EFG-Hermes said as a ratio to the emirate’s fiscal revenues, it saw little to suggest the debt level was either unmanageable or unsustainable. Karen Remo-Listana business24-7.ae

17 novembre 2008 Par La Rando

Gulf will weather the global financial crisis

The Gulf will continue to grow, albeit at a slower rate, indicating that GCC is not in a crisis, said experts. Dr Muhammad Al Jasser, Vice-Governor, Saudi Arabian Monetary Agency (Sama), said: « Do you even know the real picture? We are receiving winds of contagion from the West but we do not have the crises that are swirling Wall Street. The important thing is to look at profitability and the balance sheets of the banks and they will appear good. « If you want to disregard the profits made by the banks and focus on the negative side, it is not fair. We will weather this. This is not being self congratulatory but there is no point in looking at a glass that is half empty. » Dave Ulrich, professor of business at the University of Michigan believes that GCC will stay over the crises. « I do not have an exact answer as to when the region will come out of this but most people say it should take about one year. I think the region will just stay over the crises, » he told Emirates Business. Giving the example of the Saudi banking sector, Dr Al Jasser focused on the strong fundamentals in the region. « Our banking sector has shown good results and remains resilient amid global crisis. Saudi reserves have increased from SR157 billion (Dh156bn) in 2002 to SR1.3 trillion today. The banking sector has a leverage ratio of eight per cent and 120 per cent deposits are deployed domestically, » he said. Moreover, unlike the West, the GCC governments have followed a rather conservative policy, thus avoiding any kind of crash in the banking sector seen in the United States and Europe. « We have one of the most demanding and conservative supervisory regimes. We are very tough. Market economy is prone to excesses and if you do not have a regulator things will happen. « We have a very developed corporate governance structure. There are two external auditors for each bank with an internal audit department and have a compliance officer – all that has paid well for us, » he said. « Our domestic economy has absorbed all the liquidity. Our banks are also involved internationally but that is extremely small and does not exceed 11 per cent of the balance sheet, so the exposure is very small. On the macro economy level global financial crises is neutral, there is very little consumer debt, banks have healthy balance sheets without over leveraging and our government has paid off its debt and has built very large foreign reserve, » he said. Shuchita Kapur business24-7.ae

17 novembre 2008 Par La Rando

Mohammed approves new bridge

His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, has approved the design of the seventh crossing over Dubai Creek to be known as the « Dubai Smile ». The project, with an estimated cost of Dh810 million, will run between Dubai Creek Park, Wonderland Park and Dubai Courts in Bur Dubai, and Deira City Centre and Dubai Golf Club in Deira. Chairman of the Board and Executive Director of the Roads and Transport Authority Mattar Al Tayer said the bridge is one of the landmark projects to be undertaken by RTA, and is aimed at easing traffic congestion around the Creek. The bridge will consist of 12 lanes, six in each direction, and will have a width of about 61.6 metres. The bridge will also feature an arch rising to over 100 metres and will be able to accommodate up to 24,000 vehicles per hour. business24-7.ae