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Apr 10 - 16, 2000

  1. International
  2. Finance
  3. Industry
  4. Policy
  5. Trade
  6. Gulf

Iraq says it will use missiles to fight US, Britain

An Iraqi general vowed his country would use any available weapons and missiles to confront U.S. and British warplanes in Western-imposed no-fly zones.

"We will continue defying the aggressors' planes which violate our skies over the so-called no-fly zones," Lieutenant-General Shaheen Yassin, commander of Iraqi anti-aircraft defences, told a news conference.

"We will use all our potential, weapons and missiles, to confront American and British aggression," he said.

The no-fly zones in northern and southern Iraq were set up by the United States, Britain and France soon after the 1991 Gulf War. The aim is to protect a Kurdish enclave in the north and Shi'ite Muslims in the south from possible attacks by Baghdad.

The zones ban Iraq from using all aircraft, including helicopters, in the area.

Saudi Prince invests

Saudi Prince Al Waleed bin Talal said he had invested a further one billion dollars in technology, media and telecommunications companies, including 400 million dollars in internet giant America Online (AOL). Prince Al Waleed also invested 400 million dollars in Compaq Computer Corp., 100 million in Eastman Kodak Company and 100 million in Xerox Corp., saying the acquisitions came on the back of the "latest plunge in stock prices."

Iraq shy of foreign investment

Due to an obsession with national security, Iraq has reluctantly agreed to open its oil industry to foreign investment but ruled out other sectors despite a dire need for capital to finance reconstruction.

Production-sharing agreements signed with oil majors have in any case to await the lifting or easing of UN sanctions, in force since Iraq's August 1990 invasion of Kuwait.

Baghdad was forced to accept the principle of foreign participation in the oil sector, which was nationalised in 1972, said Munzer Al-Alussi, head of the outgoing parliament's energy commission.

Saudi sets up $9 merged electricity company

The Saudi government announced the establishment of a merged electricity company with capital of nine billion dollars as a prelude to privatisation.

The Saudi Electricity Company (SEC) was born of the merger of 10 regional electricity firms.

Commerce Minister Ossama al-Faqih announced the establishment of the firm and said shares would be sold to the public in the near future, the official news agency SPA reported, without giving a date.

The Saudi government approved the merger plan last year and said new electricity charges would be introduced to make the sector more attractive to private investors.

Iran discovers large new gas field

Iranian Oil Minister Bijan Namdar-Zangeneh announced Wednesday the discovery of the country's largest known gas field, with estimated reserves of more than 400 billion cubic metres, the official news agency IRNA reported.

The gas in the field, which has been named Tabnak (Luminous), is worth an estimated 16.5 billion dollars, Zangeneh said. It is located in the Kangan region of southern Iran, not far from other large fields.

Iran has the second largest gas reserves in the world after Russia, estimated at 20,000 billion cubic metres.

The new discovery comes as Iran, which is also a major oil producer, is seeking expansion of its gas sales abroad.

Deputy Oil Minister Mehdi Hosseini said recently that Iran's share of the world gas market was minimal.

"With measures adopted and agreements concluded with Turkey, Pakistan and India, it is hoped that Iran will gradually gain its due share on the world market," Hosseini said.

Besides those three countries, Iran is also negotiating gas exports to China, Taiwan, Korea, Japan, Australia and Malaysia, and "in the long run there would be plans to enter the US market," he added.

Iran's relations with the United States have been broken since 1980 and Washington operates a unilateral economic embargo against Tehran, accusing it of sponsoring terrorism.

US oil and gas firms are forbidden to invest in Iran and foreign companies that do so risk US sanctions, which have failed to deter a number of European majors.

Bahraini stocks dive

Bahrain's share index fell 0.5 per cent to its lowest level since mid-1997 in the week to Wednesday, suffering from lacklustre trade, dealers said. The Bahrain Stock Exchange said the index dropped 10.53 points to 2,032.99 points this week, compared to its close at 2,043.52 a week earlier.

Dubai moves towards "e-government"

Dubai announced a revolutionary project to propel its public service into the internet age, warning officials they will lose their jobs if they refuse to go electronic.

"We are launching a programme to make full use of the internet, and transform public administration into an electronic government which will reduce state expenditure and lighten the adminstrative burden," Defence Minister Mohammed bin Rashed Al-Maktum told.

"If any top officials resist this revolution, or refuse to cooperate with it, we will say: 'Thank you very much,' and show them the door," warned Sheikh Mohammed, who is also Dubai's crown prince.

The project, codenamed "e-government@dubai", is being overseen by Sheikh Mohammed personally, and is to be completed in the next 18 months.

"We want to be on the same wavelength (as the West), which is advancing at a giddying speed," he said.

"All ministries and departments in Dubai must move towards getting rid of their piles of paper and go electronic," he said.

Jordan, EU sign 129 mln euro aid package

Jordan and the European Union signed a 128.9 million euro ($123 million) aid package aimed at boosting the kingdom's debt-ridden economy, officials said.

The four agreements were signed during a one-day visit to Amman by European Commissioner for External Affairs Christopher Patten, who is on a Middle East tour.

King Abdullah expressed his gratitude to the EU and praised the ties between Jordan and Europe during talks with Patten, the official Jordanian news agency Petra said.

The grants, originally approved by the EU last November, are the largest annual aid package under a regional plan to boost Euro-Mediterranean ties.

Palestinians sign air cargo facility deal with EU

The Palestinian Authority and European Commission signed an agreement which should enable Palestinians to import and export goods by air through Gaza International Airport in about nine months.

"We signed an agreement to build a cargo facility at Gaza airport," said Nabil Shaath, Palestinian Minister for Planning and International Cooperation.

Kuwait cabinet welcomes OPEC deal, approves budget

The Kuwaiti cabinet welcomed the deal by OPEC countries to hike oil production and hoped it would achieve the desired stability in the international markets.

The cabinet also approved the draft budget for the 2000-2001 fiscal year in which oil revenues are calculated on the basis of a conservative price of 13 dollars per barrel. Kuwaiti oil is currently selling at 22 dollars.

"The cabinet expresses hope that the (OPEC) deal will achieve the desired stability in a fashion to guarantee the interests of producers and consumers alike," State Minister for Cabinet Affairs Mohammad Daifallah Sharar said.

The comments were made after the cabinet reviewed a report by the emirate's Oil Minister Sheikh Saud Nasser Al-Sabah on last week's OPEC meeting, at which the cartel agreed to increase production by 1.7 million barrels daily.

Kuwaiti officials have backed a hike in production but maintained it should not lead to a price crash. The emirate has said it would like to see oil prices at between 23 and 25 dollars a barrel.

The cabinet did not release figures for next year's budget which begins on July 1, but Sharar said it decided to increase allocations for wages to appoint Kuwaitis, and for construction projects and maintenance.

The increase means more expenditure in the private sector with the aim of stimulating a sagging economy — one of the recommendations made by a government team studying economic reforms.

Sharar said the cabinet reaffirmed its commitment to an economic reforms programme that calls for an increase in non-oil revenues without harming low-income Kuwaitis.

FLAG Telecom, Telecom Egypt in cable deal

FLAG Telecom sold Telecom Egypt cable capacity on an underwater cable system to meet rising domestic demand for Internet access, FLAG said in a statement.

"The capacity will run from Alexandria to the UK on the FLAG-Europe-Asia submarine cable system and then on to the USA using leased capacity arrangements provided by FLAG Telecom," it said. The terms of the "multi-million dollar" agreement were not disclosed.

"Egypt is seeing an ever increasing demand for Internet access and the announcement will ensure we have the ability to meet the needs of our users," it quoted Egypt's Communication and Information Minister Ahmed Nazif as saying.

Danes suspend talks on Iran's South Pars oil field

Danish oil and shipping group A.P. Moeller's Maersk Oil and Gas unit is no longer in talks with Iranian authorities on developing the South Pars field, a Moeller executive said.

"Our negotiations with the Iranians have ground to a halt.

We are no longer in talks about the South Pars oil field," Maersk Oil and Gas Deputy Director Bo Wildfang told Reuters by telephone.

Wildfang declined to say whether Maersk would pull out of the project entirely. Iran shares the massive South Pars field — estimated output capacity 100,000 barrels per day — with Qatar.

Maersk Oil and Gas produced 5.4 million tonnes of crude in Qatar last year and it is also part of a consortium pumping oil in Algeria.

Wildfang also said Maersk Oil and Gas did not plan to bid for concessions in the Ivory Coast.

Saudi Central Bank sees four pct real GDP growth

The head of the Saudi central bank said he expects the kingdom to achieve more than four per cent economic growth in real terms in 2000.

Hamad Saud Al-Sayyari, governor of the Saudi Monteray Agency (SAMA) also told journalists on the sidelines of a Bahrain financial conference he did not expect the country's currency, the riyal, to be affected negatively by fluctuations in oil prices.

"We expect it (GDP) to be higher than last year, above four per cent in real terms," Sayyari said.

World Bank grants Lebanon $57 mln

The World Bank said on Friday it lent $56.6 million to Lebanon to improve public education.

The 15-year loan was earmarked for new schools and teaching technologies. The World Bank has committed $670 million in loans to Lebanon since 1993 but bureaucratic and political interests have delayed utilisation of a significant part of these funds, prompting the bank to open an office in Beirut earlier this year to push projects through before financing is cancelled.

Europe, Africa to build new bridges

African and European leaders hold their first summit meeting on Monday to try to forge a new relationship between the EU and the world's poorest continent.