Two Gulf Co-operation Council member states – Kuwait and Bahrain – yesterday said annual inflation eased as food and beverage prices dropped from the year earlier. Annual inflation in Kuwait eased slightly to 11.1 per cent in July from 11.35 per cent in June, official data showed yesterday. All Items Consumer Price Index advanced to 131.1 points on July 31 compared with 118 points a year earlier, government data obtained by Reuters showed. Kuwait is the only Gulf state that does not peg its dinar currency to the dollar. Bahrain’s annual inflation slowed in September to 3.2 per cent from 3.3 per cent, as food and beverage prices dropped from a year earlier. Prices gained one per cent in the month, the government-run Central Informatics Organisation said in a monthly statistical report on its website. Food, beverage and tobacco prices declined seven per cent compared with a year earlier, the agency said. Bahraini inflation averaged about one per cent for the past decade, central bank Governor Rasheed Al Maraj said. Inflation has exceeded 10 per cent in five of the six GCC states, including Qatar, Saudi Arabia and UAE, Kuwait and Oman as oil-fuelled economic growth created shortages of housing and services. Agencies
General Sheikh Mohammed bin Zayed Al Nahyan, Abu Dhabi Crown Prince and Deputy Supreme Commander of the UAE Armed Forces, received at his Al Bateen palace yesterday Colombian Minister of Trade, Industry and Tourism, Luis Guigermo Plata Paez. Sheikh Mohammed stres-sed the importance of exchange visits by officials of the two friendly countries for first-hand information about economic development and to boost co-operation for mutual interest. Paez briefed on economic development regarding the open economy and reform policies adopted by Colombia. He conveyed his government’s desire to attract UAE investment. Agencies
A high-level Bush administration official says the battered US economy is open to more investment by Middle Eastern government-owned funds and other wealthy investors. Speaking to officials and reporters at the Dubai International Financial Centre during a five-country Gulf tour, Deputy US Treasury Secretary Robert Kimmitt says he is meeting with sovereign wealth funds, companies and other financial institutions in the region. The aim, he said Tuesday, is to emphasise “we’re open to investment”. Kimmitt said many potential investors he has met in the region have been looking at possible deals in the US over the past month. AP
Emirates Money Consumer Finance, the company launched yesterday by EmiratesNBD, will lend up to Dh1 billion to individuals and small businesses until the end of 2009, a senior executive said yesterday. « Our customer research has told us that we have a winning proposition and the new company is planning to lend up to Dh1bn until the end of 2009, » Chairman Jamal bin Ghalaita told Emirates Business. Emirates Money will initially offer three products – a non-salary transfer personal loan, business loans for small and medium business owners and loans for commercial vehicles and construction equipment. The company will also tailor products for trading community and other business owners, Bin Ghalaita said. « Emirates Money has been launched to cater to the financial needs of the fast-growing resident population of the Middle East. For years, many deserving customers have fallen outside the remit of regular banking channels and have often been forced to opt for long and tedious application processes and inappropriate loan products, » he said. « We are going to change that. » After setting up operations in Dubai, Abu Dhabi and Sharjah this year, Emirates Money will expand into other parts of the UAE and the Gulf next year. « It is easier for companies to expand than it is for banks, » Bin Ghalaita said. The company also plans to tie up with distributors of commercial vehicles and construction equipment, offering customers seamless financing on these products. Bin Ghalaita said the region’s financial system has adequate support from the Government after the recent financial steps taken by central banks. « Emirates Money aims to make the process of obtaining loans hassle-free and more customer-friendly than ever before, » said General Manager Vikas Thapar. « Our direct sales team, in tandem with our branch network, will ensure that an Emirates Money representative is within easy reach of anyone who wishes to apply for a loan. « Our staff have been through extensive training programmes using the robust infrastructure of the EmiratesNBD group to ensure that wherever they are located, they are ready to explain the offering, answer any questions capably and quickly handle the loan application process. » Hamed Al Sewerky business24-7.ae
The continuing slide of oil prices will not erode UAE’s energy sector revenues, Dubai’s leading investment bank affirmed yesterday. In its earnings preview, Al Mal Capital said the UAE energy sector will post « strong year-on-year (YoY) results » in the third quarter of 2008. Two prominent energy sector companies in the UAE will, in fact, register growth figures deep into two and three digits YoY, Al Mal said. Abu Dhabi National Energy Company’s (Taqa) revenue is, however, expected to dip marginally when compared on a quarter on quarter basis, the same report said. « We expect Taqa to report Dh4.4bn in revenues (up 78 per cent YoY) and Dh420m in net income (up 218 per cent YoY) in Q3, » the preview said. Taking a bullish position on Dana Gas, the report said the company performance will not only ameliorate in third quarter,but there are indications to suggest the company will fare much better in the fourth quarter. « For Q3, Dana could post Dh321m in gross revenues (up 16 per cent YoY) and Dh34m in net income (up 57 per cent YoY), » Al Mal said. « We expect Dana’s Egyptian volumes to grow slightly QoQ. We continue to expect Dana’s Kurdistan operations to start impacting numbers from Q4 onwards, » it said. The report calms down speculations that falling oil prices will dent revenues of UAE’s energy majors. Oil prices have continued to traverse a downward incline even after Opec’s recent emergency measure of cutting down production by 1.5 billion barrels a day. Spot Brent prices stood at $59.32 a barrel yesterday. The prices scrape a third of the $147 a barrel price tag oil had assumed three months ago. Al Mal’s forecasts are based on oil prices averaging at $70 a barrel and gas selling at $6 per million British thermal units. « We were never in the oil prices will reach $200 a barrel camp. With signs of recession in the West and a weakness in demand, we feel our new lower mid-cycle price estimates are more realistic, » the report said. Shashank Shekhar business24-7.ae
Saudi Arabia, the world’s top oil exporter, said there was a need to achieve balance and stability on the oil markets to guarantee continuous investment in the sector, the state news agency SPA reported. Saudi Arabia « emphasised the need to achieve balance in the oil market » and is keen on « the stability of the oil market, avoiding sharp fluctuations, the cabinet said in a statement after a weekly meeting chaired by King Abdullah. The kingdom is continuously « committed to cooperation with all Opec and non-Opec producers and to boosting dialogue with consumers », it added, noting that balanced markets were in the interests of both consumers and producers. It was the first comment made by the Saudi cabinet after the Organization of the Petroleum Exporting Countries (Opec) decided on Friday to cut 1.5 million barrels per day of output. The cut failed to prop up prices which have dropped by nearly 60 per cent from a record high $147.27 a barrel in July as global economic turmoil dents world fuel consumption. Demand has fallen in the United States, the world’s top energy consumer, and in other industrial countries as the credit crisis infects the wider economy and begins to spread to emerging markets. In China, a key market for Saudi oil, apparent oil demand rose by just over 2 per cent in September, the slowest growth in 10 months. Reuters
Saudi Arabia plans to extend 10 billion riyals ($2.7 billion) in credit to low-income citizens as Gulf Arab oil-producers step up efforts to contain the fallout from the global financial crisis. Saudi King Abdullah bin Abdulaziz ordered that the additional funds be deposited in the Saudi Credit Bank, which was established to extend interest-free loans to under-privileged Saudi citizens to help them overcome financial difficulties. The move comes on the heels of an emergency meeting of Gulf finance ministers and central bankers held in Riyadh on Saturday which was aimed at better co-ordinating the response to a global downturn that threatens to brake their region’s six-year economic boom. The Gulf Cooperation Council (GCC), preparing for a single currency by an unlikely 2010 deadline, said they were confident that economic growth would continue but were ready to take any steps necessary to shore up their economies and restore confidence. The GCC members “are satisfied with the measures taken by the countries of the council so far to deal with any possible fallout from the global financial crisis and ready to take any additional measures”. Saudi Finance Minister Ibrahim Al Assaf said after Saturday’s meeting that he was confident that the GCC countries would see their economies grow an average of 4-6 per cent in 2008 despite the global economic downturn. “The danger in this crisis is that indicators are pointing to a recession… in developed countries which suggests that the fallout from this crisis is moving into the real economy, which could carry direct and indirect effects on the economies of the Council,” Assaf said. “This requires all of us to work together to reduce their impact on our economies.” He said any slowdown in growth rates in the Gulf Arab region would be the result of a slowdown in the oil sector, as oil prices fall. Reuters
The Bahraini real estate market will extend growth on healthy local demand but at more moderate rates than those seen in the past two years, according to an executive at a major developer. The country has seen a higher proportion of local and regional investors – rather than expatriate buyers – in its property market in comparison to neighbouring markets. « That [local] demand will always be there, » said Mohammed Khalil Alsayed, Chief Executive of Ithmaar Bank and Ithmaar Development. « The prices here never heated up as in Dubai or other neighbouring countries, » he added, speaking at the Bipex 2008 property fair in Manama. Ithmaar Development predicts that it is still possible to attain between 15 per cent and 20 per cent returns on investment in high-end developments but it will not be at the red-hot pace seen in recent years. By Reuters
The current lull in the global property and construction market is pushing several industry players, especially contracting companies, to enter the GCC, and the UAE in particular, in search of better opportunities. According to industry experts, more than a hundred new companies from Europe and the United States are currently looking for opportunities to either start operations or tie-up with business partners in the UAE. « Dubai has enough work for the next five years and in Abu Dhabi things are just beginning to take off. We were not present in a major way in the UAE market until now. But even now we feel it is not too late, » said a representative of ANMOPYC, the Spanish Manufacturers’ Association of Construction and Mining Equipment. Participation in forthcoming industry exhibitions such as Big 5 PMV will be an indicator of interest and opportunities in the Gulf. If this year’s attendance at Big 5 PMV is any indication, the number of international participants has more than doubled compared to 2007. Meanwhile about 30 senior executives from Irish construction companies met in Dubai last week as part of an Enterprise Ireland initiative to help them internationalise their businesses. Construction industry in the US and most of Europe has significantly slowed down. South Korea last week said it would spend about $4 billion (Dh14.69bn) to prop up its construction industry. The UAE has so far managed to avoid any major signs of slowdown being witnessed in other parts of the world and companies are hoping that the boom in the construction industry would continue unaffected. Several exhibitors during the recently concluded Conmex 2008 in Sharjah told Emirates Business that for the next 10 years the construction industry in the UAE would continue to grow unaffected. According to them the UAE is expected to withstand the current liquidity crunch. Participants at the Enterprise Ireland initiative included Tom Costello, Managing Director of contracting firm John Sisk & Son, and Finn Lyden, Chief Executive of Siac Construction, besides several heads of architectural, engineering, surveying and interiors companies. According to reports, Liam O’Donohoe, head of leadership development at Enterprise Ireland, said the scheme was designed to help companies expand their business outside Ireland and to enable them to work together to secure projects. According to Nick Webb, Director of Streamline Marketing Group, organiser of Big 5 PMV, of the 300 global and 53 local firms participating in this year’s exhibition, 241 are attending for the first time. « A lot of these companies are looking for new opportunities here, wanting to do business, » he said. More exhibitors from the concrete production sector at Big 5 PMV is an indication of growing construction activity in the region. According to Webb countries such as Spain never looked to enter overseas markets as the local industry was performing well. « They are not happy any more and are now keen on overseas expansion. Although the actual number of Spanish companies participating in Big 5 PMV is less compared to other European countries, with 89 per cent Spain stands first, » he added. The number of Italian companies has increased from 38 in 2007 to 81 in 2008 while Chinese participation rose from 24 to 82. According to the French Trade Commission, there is a growing tendency for local real estate developers and contractors to award design and build contracts to French companies, enticing many firms to increase their presence in the UAE. Pascal Roger of the French Trade Commission said: « While French equipment and building material suppliers have been present in the UAE for some time, there is a large influx of French contractors coming now. This is due to changing market conditions in France as a result of increased tax rates and the effects of the economic slowdown. French construction groups are keen to work in the UAE and the region. » By Joseph George business24-7.ae
A state-of-the-art Children’s Public Library, the first ever is to be constructed in the Sultanate of Oman, as part of the government’s vision to create a knowledgeable and well-balanced society. The Philadelphia based company, VITETTA a renowned library developers, have been appointed as the project consultants. The company is at the forefront of library design and planning and have developed similar projects in the United States, Europe and South America. Sayyida Dr Muna Fahad Al Said, Honourary Chair, announced the construction of the Children’s Public Library which will be situated adjacent to the Children’s Museum and the Museum of Natural History on land generously designated by Sayyid Haitham bin Tariq Al Said, Minister of Heritage and Culture. This declaration is set to bring enormous advantages and opportunities to the youth of Oman – now and in the future – and will promote the Sultanate as a forward-looking Gulf country committed to education and innovation, said Dr Muna. The plans integrate Omani architecture, culture and heritage with contemporary designs and state-of-the-art learning and educational technology. The new building will be organised in four distinct levels to serve the different learning stages of children. Novel and imaginative use of light, space and glass will provide a welcoming and creative feel and promote participation in educational and recreational activities. “I am delighted to be part of this pioneering initiative. By creating Oman’s first Children’s Public Library we are investing in tomorrow, today. We welcome more supporters to join us in this important initiative and together we can help shape the next generation,” said Dr. Muna. khaleejtimes.com
