The GRC Gulf Business Weekly Report - Gulf Research Center

Gulf Business Weekly Report
July 1-7, 2006
Bahrain
Bahrain’s score in an influential international report which measures economic freedom has
slipped for the second year in succession. However the Kingdom still retains it status as the
most economically free country in the Middle East, according to the recently published Index
of Economic Freedoms 2006. (Bahrain Tribune, July 1)
Bahrain’s capital market has been relatively unscathed by the market corrections sweeping
through other bourses in the region. Strict corporate governance rules and a strong regulatory
framework have helped soften the impact of the recent downturn in the markets, says Khalid
Hamad, Executive Director, Banking Supervision, at the Bahrain Monetary Agency. (Bahrain
Tribune, July 1)
Bahrain's Chamber of Deputies (elected house) finally passed the state budget for 2007-08
after the government agreed to include 20 million Bahraini dinars for social assistance for the
needy as well as urbanisation projects. (Gulf News, July 4)
Bahrain's Telecommunications Regulatory Authority said it’s mulling the possibility of
issuing additional mobile licenses. (Gulf News, July 4)
United Gulf Bank, the Bahrain-based investment banking arm of Kuwait's KIPCO Group, has
been assigned a Baa3 and Prime-3 a long- and short-term deposit ratings by rating agency
Moody’s Investors Services. (Bahrain Tribune, July 4)
US-Bahrain relations will enter a new era when the Free Trade Agreement comes into force in
the coming weeks, said US Ambassador William T Monroe. (Gulf Daily News, July 5)
The Bahrain Monetary Agency, the country's central bank and single regulator for the
financial services industry, is seeing phenomenal growth in the mutual fund industry. (Gulf
News, July 5)
Oil prices held above $73 a barrel, supported by nagging fears about supply disruption and
expectations of strong US demand for petrol. London Brent crude was 13 cents lower at
$73.26 a barrel. (Bahrain Tribune, July 5)
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Bahrain-based International Investment Bank announced the formation of a $100 million real
estate development company in Saudi Arabia. (Gulf Daily News, July 6)
Bahrainis are the only GCC nationals not to have significantly lessened their purchase of
freehold property in Dubai in the last year, new figures reveal. The Dubai Land Department
said that buyers from the Kingdom bucked a general trend which saw deals involving GCC
nationals fall 11 per cent in the first half of 2006 (Bahrain Tribune, July 07)
Kuwait
The Lebanese Foreign Ministry received a document from the Gulf Cooperation Council
recalling that the free trade zone agreement between GCC members and Lebanon will be
implemented July 6. (Kuwait News Agency, July 1)
The total value of the crude oil exports in the oil producing Arab states and members of the
Organization of Arab Petroleum Exporting Countries reached $327.4 billion in 2005, $99
billion increase compared to 2004. (Kuwait News Agency, July 02)
Kuwait's Investment Dar said it would set up a Saudi investment firm with Saudi investors,
placing itself for future growth in the country’s real estate, insurance and investment market
(The Peninsula, July 2)
Several economics experts said they expected oil prices to continue to rise through the second
half of this year and to remain above the $50 mark per barrel due to increased worldwide
demand for oil and due to the fact that not enough oil was on offer. (Kuwait News Agency,
July 2)
GCC and EU experts were held trade talks in Brussels in a bid to seal a free trade agreement.
(Kuwait News Agency, July 5)
The Ahlia Investment Company said it had received an offer to sell its share in the Lebanese
Ahlia Investment Company, which was involved in the construction of the Beirut Tower in
the center of the Lebanese capital. (Kuwait News Agency, July 5)
Rheinmetall, the German auto parts and defence technology specialist has said it had won a
contract worth 40 million euros to supply the Kuwait government with naval defense weapons
systems. (Agence France-Presse, July 5)
Kuwait's Gross Domestic Product for 2005 has achieved a 35 percent growth and totaled $81
billion, a report by the National Bank of Kuwait said. (Kuwait News Agency, July 6)
Iraqi Prime Minister Nouri Al-Maliki called upon Kuwait investors to invest in his country
and contribute to its reconstruction (Kuwait News Agency, July 6)
The growth in exports of Kuwait's manufacturing industries was estimated at 17 percent in
2005 with preliminary statistics putting the value of these exports at KD 500 million. (Kuwait
News Agency, July 7)
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The Kuwait-based Arab Fund for Economic and Social Development signed a 25 million
Kuwaiti Dinar loan agreement with Tunisia to construct a power plant. (Kuwait News
Agency, July 7)
Oman
The US Senate has approved the Oman Free Trade Agreement, leaving one final battle in the
House of Representatives before the accord can be implemented. (Times of Oman, July 1)
The state-owned Oman Shipping Company is expanding its fleet in a big way (Times of
Oman, July 1)
A contract was signed for the construction of the estimated $1.5 billion plant of Aromatics
Oman LLC at the Port of Sohar. (Oman Daily Observer, July 2)
The US Trade Representative Office has hailed the Senate’s endorsement of the Oman-US
free trade agreement. (Times of Oman, July 3)
Aromatics Oman LLC announced the signing of the Engineering, Procurement and
Construction contract with LG International Corporation and GS Engineering and
Construction Corporation (Oman Daily Observer, July 4)
Oman & Emirates Investment Holding Company, which is 60 per cent owned by the
governments of Oman and the UAE, has sold a 50 per cent stake in its 100 per cent UAE
subsidiary United Brokerage Company. (Times of Oman, July 4)
A group of individual and institutional investors, primarily from Saudi Arabia, Bahrain and
Oman, is floating a mega buyout firm with an authorized capital of $1billion. (Times of
Oman, July 4)
The first phase of an ambitious 'logistics city' planned near the Port of Sohar will be
operational within a year. (Oman Daily Observer, July 4)
The government will invest RO6.5 million to obtain licenses for Microsoft desktop products
following a three-year agreement it signed with the US-based multinational computer and IT
giant. The deal covers the usage of Microsoft software in 22,500 desktops across various
Omani government organizations. (Khaleej Times, July 5)
Oman's free trade agreement with the United States is crucial for the sultanate as it would
attract US investments to the country while encouraging the introduction of Omani products
to the United States without any tariffs, Undersecretary of the Ministry of Commerce and
Industry Ahmed Al-Theeb said. (Kuwait News Agency, July 6)
Oman has expanded Port Khasab with a cost of 17 million Omani Riyals, about $45 million,
in an effort to boost trade with Iran, the port's chairman Mohammed Al-Shehhi said. (Kuwait
News Agency, July 6)
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The weekend effect was evident as the Index closed in the negative by a marginal 0.13 per cent;
narrowing the weekly differential down to -0.05 per cent. (Oman Daily Observer, July 7)
Qatar
Qatar Investment Authority has raised its stake in French media to aerospace group Lagardere
to 6.1 per cent, France's stock market regulator said. (Gulf News, July 1)
Pakistan and Qatar Friday signed an agreement to further foster bilateral ties in economic,
trade and banking sectors. (Kuwait News Agency, July 1)
The Qatari economy grew by 8.4 per cent in the first quarter of this year as compared to the
previous quarter ending December 31. (The Peninsula, July 2)
The International Monetary Fund projects the growth of the Qatari economy in 2006 to be
18.7 per cent, says Yousef Hussein Kamal, the Minister of Finance and acting Minister of
Economy and Commerce. (The Peninsula, July 3)
Qatar Gas Company and French company Total signed an agreement which delegates the
latter to market 5.2 million metric tons of liquefied gas of Qatar Gas 2 project to a number of
countries which include France, the US, Britain and Mexico. (Gulf Daily News, July 7)
Saudi Arabia
Higher oil prices have not had a negative impact on global growth, Saudi Arabia's oil minister
wrote in a French newspaper, saying initiatives by oil producing states would stabilize the
market sooner or later. (Reuters, July 1)
A new $3.5-billion oil pipeline, whose inauguration will be attended by Saudi Petroleum and
Mineral Resources Minister Ali Al-Naimi on July 13 in Turkey, will serve as an east-west
energy corridor linking Azerbaijan with Turkey and from there to the Western markets. (Arab
News, July 2)
An SR600-million company, called Combined Saudi Co, has been set up in the Eastern
Province as part of a comprehensive plan to promote Saudi-Kuwaiti investment in real estate,
health care, tourism and other sectors. (Arab News, July 2)
After having been elected chairman of the Jeddah Chamber of Commerce and Industry (JCCI)
eight months ago, Abdullah Al-Muallimi submitted his resignation in a sudden but predicted
development following internal conflict among board members at the JCCI. (Arab News, July 3)
The holding company of Saudi Arabia's new economic city has won commitments of up to
1.5 billion Saudi riyals from GCC investors including the UAE, officials announced. (Gulf
News, July 4)
A group of Saudi investors has set up a limited liability company with a paid-up capital of
SR420 million to construct a chain of Islamic-oriented serviced apartments in Riyadh, Jeddah,
Makkah and Madinah, as well as in Egypt. (Arab News, July 4)
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Saudi Arabian Oil Company has discovered a new gas field in the country's eastern region,
said Saudi Minister of Petroleum and Mineral Resources Ali Al-Naimi. (Kuwait News
Agency, July 5)
Saudi Arabia has awarded a SR134 million contract to a major Turkish company to build a
major dam near the southern Saudi city of Jizan in a new move to ensure protection from
turbulent floodwaters and to ensure better water management. (Arab News, July 6)
The Saudi Al-Rajhi Banking and Investment Corp has said its net profits for the first six
months of 2006 rose by 55.4 percent to $941.5 million. Agence France-Presse, July 6)
The Saudi Capital Market Authority has announced a new draft of regulations to inject greater
transparency into the functioning of the private sector and the prevention of CEOs from
taking arbitrary decisions. (Arab News, July 7)
South Rub Al-Khali Company, a joint venture between Saudi Aramco, Royal Dutch/Shell and
Total, said it had started digging its first gas well in Saudi Arabia's Empty Quarter. (Khaleej
Times, July 7)
In a bid to encourage more women entrepreneurs in the Kingdom, Saudi businesswomen can
now register their businesses themselves without a lawyer and in an hour according to an
official at the Ministry of Commerce’s Jeddah branch. (Arab News, July 7)
Three Saudi banks are planning to distribute more than SR2.6 billion ($700 million) among
the shareholders for the first half of this year (Arab News, July 7)
United Arab Emirates
Dubai Financial, a subsidiary of the Dubai Investment Group, an investment arm of Dubai
Holding, will acquire a 40 per cent stake in Bank Islam, Malaysia's oldest Islamic lender.
(Gulf News, July 1)
Aabar Sukuk Limited listed a $460 million sukuk Al-Mudarabah on the Dubai International
Financial Exchange. (Khaleej Times, July 1)
India's Essar Group, a multi-billion dollar steel-to-telecoms conglomerate, plans to set up
three steel plants in the Middle East at a cost of about $1.5 billion as part of a big regional
push. (Gulf News, July 1)
Leaked minutes from an Airbus audit committee reveal that the embattled plane-maker could
make heavy losses on the first deliveries of its snag-hit A380s to launch customers including
Emirates Airlines, Singapore Airlines and Qantas. (Khaleej Times, July 2)
The proceeds from oil exports of the six Gulf states and Libya rose to $ 440 billion last year
from $186 billion in 2002, pushing their economic growth by an average seven per cent in
2005, according to a latest World Bank report. (Gulf News, July 2)
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The UAE Ministry of Economy has thwarted an attempt by the country's cement producers to
raise cement prices by Dh10 per tonne. (Gulf News, July 2)
Inflation in the UAE, which peaked at eight per cent last year, could drop to 6 per cent this
year, remaining at lower levels in the short term, according to the latest Standard Chartered
Bank forecasts. (Gulf News, July 2)
Dubai unveiled an ambitious strategy for investing in overseas assets with the launch of a
holding company comprising around 20 entities, some of them managing multi-billion-dollar
assets. (Gulf News, July 3)
Britain and other West European countries are the main sources of drug money laundered in
the UAE, the governor of the UAE Central Bank said. (Khaleej Times, July 3)
A consortium comprising Nigeria's Transnational Corporation, British Telecoms and Etisalat
won a tender for a 75 per cent stake in Nigeria’s state-run telecom firm NITEL. (Khaleej
Times, July 4)
Abu Dhabi National Oil Company has raised the June retroactive price for its key Murban
crude by 35 cents per barrel to a new high of $68.85, Adnoc said. (Gulf News, July 4)
An Etisalat-led consortium won Egypt's third mobile license for 16.7 billion Egyptian pounds
in a fierce contest (Gulf News, July 5)
Two Gulf-based telecom giants – Investcom of Dubai and MTC of Kuwait – are poised to
stage a comeback as strong contenders for Millicom International Cellular SA, following the
exit of China Mobile from a $ 5 billion race to acquire the Swedish company. (Khaleej Times,
July 5)
Emaar Properties has opened a full-fledged office in Shanghai, marking its entry into China
with a plan to roll out a number of real estate projects including residential, commercial,
hotels and hospitals, a company statement said. (Gulf News, July 5)
The $4.2-billion Dubai Metro will be maintained and operated by Transport Authority. "We
international firms through a joint venture agreement with the Roads and have gone to the
marketplace and invited well-known international firms to bid for this work. (Khaleej Times,
July 5)
The Dubai Financial Market's general index is approaching the key 400-point mark after
falling 1.94 per cent to 416.25 points. (Gulf News, July 5)
Dubai Land Department has started registration of freehold properties for non-GCC residents,
according to a source. (Gulf News, July 6)
Eighty per cent of high net worth individuals (HNWIs) in the Middle East — the world's
fastest breeding ground for dollar millionaires – have investments and residences in foreign
countries, placing the region's affluent in the forefront of non-domestic asset allocation
worldwide. (Khaleej Times, July 6)
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The Emirates Securities and Commodities Authority will supervise all the trading floors of
the Dubai Multi Commodities Centre, which hosts the region's only commodities, gold,
diamond and tea trading exchanges. (Gulf News, July 6)
Expensive oil and big new projects have boosted the value of international energy firms'
stakes in the Middle East, but they must still battle for access to the region's reserves,
consultancy Wood Mackenzie said. (Gulf News, July 6)
The Abu Dhabi Airports Co that replaces the Department of Civil Aviation will become a
formal commercial entity in September. (Gulf News, July 6)
FS International Partners SA recently launched an investment scheme to establish the first
Sharia-compliant bank, Tayseer Bank, in France (Gulf News, July 6)
Emirates, the Dubai-based international airline, announced the signing of a $261-milliondollar
financing agreement with an American bank for two Boeing aircraft. (Khaleej Times,
July 7)
Two UAE investors approached the Dubai Financial Services Authority last April, saying
they'd fallen victim to a "boiler room" scam run by Charles Fleming & Co Ltd in Japan. (Gulf
News, July 7)
Gold prices were steady as North Korea’s vow to carry out more missile tests failed to inspire
more safe-haven buying of bullion, and dealers said the market was likely to turn to
currencies for direction. (Economy Choice, Khaleej Times, July 7)
Compiled by the Gulf in the Media team at the Gulf Research Center, Dubai.
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The GRC "Gulf Business Weekly Report” is published online in Dubai, United Arab Emirates,
by Gulf Research Center, as part of the GRC Gulf Business Weekly Bulletin Series. The news is
excerpts from regional newspapers and news agencies and do not state or reflect the position of
the Gulf Research Center.
© Gulf Research Center 2006
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