'New economy' comes to the
The New Economy that has been so much talked about in the United States
and Europe is now the subject of discussion at "Family Company Management", a
conference on Gulf family businesses, according to a press release from Press Release
The event will be held at the Metropolitan Palace Hotel in Dubai from
March 26 to 28.
John Sandwick, head of the portfolio management firm Encore Management
S.A. in Geneva, says "There is a lot of talk now about New Economy companies taking
off, and leaving the Old Economy companies behind.
This means that many family companies in the GCC will lose in the race
for shareholder funds and new business. Those that don't understand this very rapid change
will fail. Those that re-engineer will succeed."
The New Economy is represented by those companies at the forefront of
changing business practices. That means leaner management, more flexible ownership
structures, and a far greater reliance on outside capital.
It also means a much greater emphasis on technology, especially the
Internet and E-commerce.
Predictably, says Mr. Sandwick, Old Economy companies in the GCC have
focused much of their past efforts on traditional trading and real estate.
The number of world-class manufacturing and service firms is limited.
The universe of top-level Information Technology companies is even smaller, and must grow
to meet the demands of international business.
Saddam orders boost to Iraq's currency, output
Iraqi President Saddam Hussein has ordered his cabinet to sell hard
currency to public and mixed sector companies at a concessionary price to increase
production and boost Iraq's volatile dinar currency.
Energy firms, banks form internet exchange
Seven leading banks and energy concerns announced on Tuesday they had
joined forces to launch an online electronic market for trading over-the-counter (OTC)
energy, metals and other commodities. In the biggest foray yet on to the internet in those
markets, the venture said it planned to begin trading various petroleum and
precious-metals based OTC products later this year. It also intends to develop additional
markets for global natural gas, electrical power and a variety of base metals in due
The companies are BP Amoco, Royal/Dutch Shell, Totalfina, Goldman
Sachs, Societe Generale, Morgan Stanley Dean Witter and Deutsche Bank.
The seven founders, already among the largest players on energy and
commodity markets, said they had made a commitment to provide initial market liquidity for
the new exchange called IntercontinentalExchange.
Neal Shear, global head of commodities at Morgan Stanley, said that in
markets now valued at $1.8 trillion annually, electronic trading could significantly
reduce trading costs.
Economic reality looms over new PLO land
A handshake and gunshots fired into the sky symbolised Palestinian
hopes that an independent state was closer on Tuesday when Israel ceded more West Bank
land to the Palestinian Authority (PA).
More mouths to feed, Palestenians want quality as well as quantity But
as the population and land under its control swell, the PA will face new pressures to
implement regulations, improve land registration and provide jobs, economists say.
"Every inch of land added to the PA domain is an economic
plus," said Mohammad Ishtayyeh, head of the semi-official Palestinian Economic
Council for Development and Reconstruction.
PMs hold working meeting
Tunisian Prime Minister Mohamed Ghannouchi and his Egyptian counterpart
Atef Ebeid co-chaired a meeting of the Egyptian-Tunisian joint higher committee, the
state-run MENA news agency said.
Ebeid said in a speech at the first of a series of meetings that he
hoped trade would be boosted to 300 million dollars a year from its current level of
around 80 million dollars, MENA reported.
Egypt and Tunisia have begun implementing a bilateral free trade zone
which will come into full effect in 2007, the same year that a free trade zone between all
Arab states is due to be completed.
More than 50 million dollars of their bilateral trade is accounted for
by Egyptian exports.
Morocco 99 clothing exports
Morocco's clothing exports grew only slightly in 1999 due to increasing
competition and higher costs, an industry official said on Tuesday. Mohamed Tazi,
secretary-general of the Textile and Clothing Association (AMITH), said exports inched up
0.3 percent to 25.6 billion dirhams ($2.49 billion) in 1999.
"Rising energy costs, heavy tax system and contraband trade in the
country prevented growth in the clothing industry, which employs over 190,000," Tazi
Kuwait probes huge losses in national carrier
Finance Minister Sheikh Ahmad Abdullah Al-Sabah has ordered a probe
into the finances of Kuwait's national carrier after it incurred a loss estimated at 80
million dinars (265 million dollars) last year.
In a letter to parliament, Sheikh Ahmad, who is also communications
minister and chairman of state-owned Kuwait Airways Corp. (KAC), said "huge"
losses were also recorded in previous years, Al-Rai Al-Aam newspaper reported Saturday.
Although the minister gave no figures, a member of parliament`s finance
and economics committee, Ahmad Al-Duaij, has said KAC losses for the 1998-1999 fiscal year
which ended in June amounted to 80 million dinars.
US agrees Iraq oil industry must get more funds
The United States agrees that allocation of funds to Iraq`s ailing oil
industry from its UN-controlled sales of crude must be increased, a senior US official
said on Wednesday.
United Nations Secretary General Kofi Annan warned last week of the
"massive decline in the condition, effectiveness and efficiency" of Iraq's oil
In a report to the UN Security Council, he renewed a recommendation for
doubling the half-yearly allocation for the industry to 600 million dollars. The council
is due to discuss the situation in Iraq on Friday.
Oil price falls
The price of oil fell Monday, following a series of comments raising
expectations that OPEC ministers will increase production at a Vienna meeting next week.
In London, the price of Brent North Sea crude for May delivery fell 53
cents to 26.03 dollars a barrel.
In New York, light sweet crude for April closed at 30.91 dollars a
barrel on Friday.
GNI Research said weekend comments "underscore consumer demands
for higher production and producer acknowledgements of these needs." Oil ministers
are continuing talks to attempt to forge agreement ahead of the Vienna meeting on March 27
of ministers from the Organisation of the Petroleum Exporting Countries.
US Energy Secretary Bill Richardson is visiting Nigeria, Indonesia and
Algeria, while Venezuela's Energy Minister Ali Rodriguez is on a tour of Iraq, Iran,
Kuwait, Algeria and Libya.
Egyptian foreign reserves continue to slide
Egypt's foreign reserves slipped further over the month of December to
reach 15.63 billion dollars, their lowest level since 1993, according to the Egyptian
central bank`s latest monthly report.
The central bank's net international reserves registered their 16th
consecutive monthly drop, down from 16.18 billion dollars in November 1999 and 20.00
billion dollars in November 1998, according to the bank's March report published Tuesday
by the state-run MENA news agency.
The bank has been forced to spend its reserves to meet the demand for
dollars which have been in short supply for over a year. The Egyptian pound is pegged to
The dollar crisis has roused fears of a devaluation of the pound, but
Prime Minister Atef Ebeid's government has repeatedly denied any such plans.
Morocco signs debt conversion accord with France
Morocco and France signed an accord on Tuesday to convert 700 million
francs ($103.5 million) worth of outstanding Moroccan debt into investment credits.
Negotiated in February, the accord was signed by finance ministers
Fathallah Oulalou and Christian Sautter during a lunch with Prime Minister Lionel Jospin
and Morocco's King Mohammed.
It brings the total amount of Moroccan debt converted by France into
private investment credits to 2.7 billion francs following similar agreements in 1996,
1997 and 1998 and in the wake of an agreement by the Paris Club of creditors last
September raising a ceiling on debt conversion.
Arab Insurance dips into the red
Arab Insurance Group (ARIG), the Arab world`s biggest insurance firm,
reported on Sunday a net loss for 1999 of $98 million, saying it was the first time it had
dipped into the red since 1991.
It attributed the loss -- which compared to 1998's net profit of $1.6
million mainly to a spate of disasters, tough competition and expenses involved in
ceasing underwriting at its subsidiary ARIG UK, which cost the group $24.4 million.
"Arab Insurance Group reported a net loss of $98.0 million for
1999, the first since 1991, as a result of the adverse operating conditions faced by its
core reinsurance business," an ARIG statement said.
Japan considering lifting sanctions on Libya
Japan said on Tuesday Libya no longer poses a terrorist threat and that
it would consider lifting eight-year-old sanctions on the state.
"We are considering the lifting of sanctions imposed on
Libya," a Japanese Foreign Ministry official told Reuters.
Japan's punitive steps, taken in 1992 after a 1988 bombing of a Pan Am
airliner over Lockerbie, Scotland, included a ban on flights between the two countries,
exports of parts for aircraft and petrochemical facilities, and cash remittance to Libya.
The official did not say when Tokyo would lift the sanctions, but local
television broadcaster NHK reported that the move could come by the end of March.
Drinking water resources
As much as 50 percent of the Egyptian capitals drinking water, which
originates from the Nile River, is being lost through underground leaks and illegal
tapping, specialists warn.
According to reports by the World Water Forum, which wound up a six-day
meeting in The Hague on Wednesday, around half of the water distributed in Cairo and
Mexico City leaks back into the ground before reaching the taps.
Western water experts in Cairo, not all of whom agree with the
estimate, say such a figure is difficult to confirm in the absence of recent studies on
water wastage and add that the reasons for water loss are numerous.
US House approves OPEC 'arm twisting' bill
Angry at OPEC for steering oil prices higher, the US House of
Representatives approved legislation on Wednesday pressuring the cartel to raise
production and reaffirming President Clinton`s authority to cut US aid and arms sales to
OPEC and nations that fix world oil prices.
The 382-to-38 vote in favour of the bill comes just five days before
the Organisation of Petroleum Exporting Countries meets in Vienna to decide whether to
ramp up production.
"We're putting pressure on the OPEC nations," said
Representative Benjamin Gilman, the New York Republican who sponsored the legislation and
chairs the House International Relations Committee.
The legislation would not give the president any new authority to
punish OPEC, but encourage him to use his existing power to confront the cartel over its
oil production policies by reducing or terminating US aid and armed sales.
The bill would require President Clinton to report to Congress within
30 days on which OPEC nations have fixed oil prices, and then begin negotiations to stop
those price fixing activities.
The House bill is a sharp rebuke of the Clinton administration's energy
policy, which many Republican lawmakers believe allowed OPEC to gouge US consumers with
high gasoline, home heating oil and diesel fuel prices.
With US gasoline prices poised to rise as high as $1.80 per gallon
ahead of the nation`s general elections, lawmakers from both political parties want the
White House to apply more pressure to OPEC to ease world oil markets.
Hundreds of US truckers gathered on Capitol Hill to ask Congress for
relief from high fuel prices and for action against the OPEC countries they blame for the
Microsoft says fixing
The head of Microsoft's European and Middle East operations said the
firm was fixing a bug in its Windows 2000 French-language spell-checker which suggested
replacing "anti-stress" with the word "anti-arab".
Michel Lacombe, President of Microsoft EMEA, said the problem should be
fixed in "a few weeks" and that customers would be offered a new version free of