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Apr 24 - 30, 2000

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

Gas pipelines cost reduced

A project to build two natural gas pipelines in Oman is to cost 49 percent less than the $600 million initially slated when it was announced in February, a senior project official said.

"It will cost us 49 percent less than was estimated earlier in the year due to a large reduction on project overheads," the official told Reuters, but gave no more details.

Gulf Air drop in result

Regional carrier Gulf Air has recorded profits sharply down for 1999 at 400,000 Bahraini dinars ($1.1 million).

Omani airports aim high

Oman's main airports are aiming high with the Gulf's first privatisation in the sector, as a vision of "controlled" tourism starts to take off in the sultanate.

"By the end of this year, we hope to finalise the process of tendering and selection" for the joint privatisation of Muscat and Salalah airports, Ahmad Said Al-Rawahi, director general of Oman's civil aviation department, told.

BP becomes biggest foreign player

BP Amoco becomes the biggest foreign player in Algeria, overtaking US Anadarko, following its purchase on Tuesday of US Atlantic Richfield. The British oil giant intends to entrench itself in the North African country to fulfil a long term gas strategy in southern Europe, BP Amoco officials in the country say.

Saudi cuts telephone charges

Saudi Arabia will cut the cost of international and local telephone calls from May 1 by between 20 and 50 percent, as well as slashing the subscription charge for mobile phone users, newspapers reported Wednesday. Khaled Al-Qusaibi, acting minister for post and telecommunications and head of the Saudi Telecommunications Company (STC), said telephone calls to other Gulf countries will be cut by 30-40 percent.

Oracle to establish digital market place

This business-to-business marketplace will enable businesses to buy and sell both products and services on line, enabling real-time collaboration between suppliers and customers according to a press release. Dubai Ports Authority and Jebel Ali Free Zone will lead the digital marketplace initiative, while Oracle will provide the marketplace software technology and hosting platform.

Iraq exported more than $23 bln in oil

Iraq has exported more than 23 billion dollars in crude oil since its oil-for-food accord with the United Nations went into effect in December 1996, Trade Minister Mohammed Mahdi Saleh said Sunday.

But, "Iraq lost more than 140 billion dollars in oil exports because of the (UN) oil embargo" and the ceiling imposed on the country in the oil-for-food program, a partial alleviation of the embargo, Saleh said, quoted by the official INA news agency.

Hess signs $579 mln upstream deals

US oil company Amerada Hess Corp said it had clinched its first oil exploration and enhancement deals in Algeria after signing two contracts totalling $579 million. The contracts, signed between Chairman Abdelahaq Bouhafs of state-run oil and gas monopoly Sonatrach and Amerada Hess President Sam Laidlaw at the opening of a four-day oil technical meeting, culminate almost two years of talks and six months of intense negotiations.

Egypt signs $52 mln Arab Fund loan

Egypt signed a loan agreement with the Kuwait-based Arab Fund for Economic and Social Development (AFESD) on Sunday for 16 million Kuwaiti dinars ($52 million), the official Kuwait news agency KUNA reported. KUNA quoted an AFESD statement as saying the loan would help finance a project to upgrade Egypt`s railway system. It said the 22-year loan carries a three percent annual interest rate and a five-year grace period.

Egypt to issue $300-400 mln in first sovereign bond

Egypt plans to issue its first sovereign bond worth $300-400 million this year to establish a benchmark in the international market and ease domestic debt, a finance ministry official said on Wednesday.

"The ministry has not decided yet on the type of these international bonds," Abdel Fatah Al-Gebaly, adviser to Finance Minister Medhat Hassanien, told Reuters.

He said the bonds would establish a benchmark in the international market and would be used to repay some of Egypt's domestic debt, which totals 147 billion pounds.

Iran allows private banking, first time since 1979

Iran said it would allow private banking across the country for the first time since the 1979 Islamic revolution, but would not initially let foreign banks set up in the country.

"The private sector can establish banks in Iran," Central Bank Governor Mohsen Nourbakhsh told reporters. Asked if the new regulations would apply to foreigners, he said: "At present, no." The landmark decision follows a recent move by parliament to end the state monopoly on banking. Iran nationalised all private banks after the revolution, in which it became a republic, in an attempt to prevent the outflow of national wealth.

The decision is part of a five-year plan by President Mohammad Khatami's government to liberalise and streamline the state-dominated economy, widely seen as inefficient.

The plan, which runs from 2000 to 2005, hopes to achieve ambitious growth targets, including an average 8.5 percent rise in private investment.

Morocco's main port paralysed by strike

A strike by some 3,000 civil servants and dockers that has paralysed Morocco's main port of Casablanca stretched into its fifth day on Monday.

The stoppage at the port, which handles 70 percent of the country's cargo traffic, began on Thursday after unions accused the state-run ports authority ODEP of back-tracking on an agreement over pay hikes and other benefits.

According to the unions, about 50 vessels transporting crude oil, sugar and cereals have been unable to unload.

Saudi hopes for $100 bln foreign investment

Saudi Arabia hopes current negotiations with foreign oil firms will bring in around 100 billion dollars of investment, Saudi Foreign Minister Saud Al-Faisal said.

"As Crown Prince Abdullah bin Abdul Aziz said recently, the level of investment planned is around 100 billion US dollars," he told the official SPA news agency after meeting with the president of Anglo-Dutch oil giant Royal Dutch Shell, Mark Moody-Stuart.

Prince Saud and Oil Minister Ali Al-Nuaimi led the Saudi side at the talks in the oil-rich kingdom's economic capital of Jeddah on the Red Sea.

The official news agency SPA said Royal Dutch Shell was the first foreign company to take part in the dialogue.

"These investments will have a positive impact on the national economy, with each billion dollars invested in the oil and gas sector representing between 10,000 and 16,000 jobs created for the Saudis," said the foreign minister.

Nineteen years after nationalising its oil industry, Saudi Arabia, the world's leading oil exporter, has invited international companies to invest once again in its energy sector.

Out of 18 Western firms invited in late 1998 to submit investment proposals, it has retained 10.

MobilExxon, Chevron, Texaco, Conoco, Phillips and Marathon from the United States, and Europe's BP Amoco, Royal Dutch Shell, TotalFinaElf and Eni.

The negotiations, expected to last two weeks, are to focus on gas field development, electricity generation and refining, while oil production is excluded from the current phase.

Prince Saud said Saturday that his ministerial committee would deliver a report on the outcome of the talks to the Supreme Council for Petroleum and Mineral Affairs chaired by King Fahd for its verdict.

Oman completes upgrade of private power plant

Oman's United Power Company (UPC) has completed a 40-million rial ($104 million) project to triple power generation capacity at its private power plant, a UPC official said.

"The project to triple the power capacity is completed and commissioning will take place next month," UPC Vice President Said Jumayil told Reuters.

Ground set for economic revolution in Iran

Iran's parliament has laid the groundwork for wide-ranging privatisation, clearing the way for President Mohammad Khatami to end years of state controls, an influential Iranian deputy said.

But he warned that the oil-rich state's entrenched bureaucracy could block Khatami's five-year plan for the economy, announced last month to bring in market reforms.

Parliament recently approved much of the privatisation programme, targeting key energy, communication, banking and transport sectors for the first time since the 1979 Islamic revolution.

Nobakht is a senior member of the parliamentary commission which studied Khatami's economic reforms and is one of the reformist president's supporters voted into parliament in large numbers last February.

The state controls over 80 percent of the economy. Past governments have defended state ownership, arguing the government is best placed to ensure the nation's interests.

After the 1979 Islamic revolution, its leaders seized private banks, insurance companies, major industrial units and land owned by the rich.

But the state-led policies of the past, inspired by the socialist overtones of the revolution, have brought the economy to a virtual standstill.

The bloated state bureaucracy and huge subsidy programmes absorb much of the revenue from oil exports.

Unemployment is rising, worsened by the scarcity of private investors and inefficiency in the public sector.

Khatami wants to boost private investment to try to achieve annual economic growth of six percent over the next five years, hoping to create 3.6 million jobs for his young supporters among the electorate, now a generation away from the revolution.

US imposes sanctions

The United States imposed sanctions against North Korean and Iranian entities involved in SCUD missile technology transfers, complicating rapprochement efforts with those countries.

"We imposed these sanctions on North Korean and Iranian entities for the knowing transfer of equipment and technology controlled by the missile technology control regime," State Department spokesman James Rubin said.

Under the two-year penalties, the United States is to deny the entities all new US contracts and new individual export licences for items controlled by the State and Commerce departments.

The sanctions cover a category of weapons that includes complete missile systems, major subsystems, rocket stages or guidance systems, production facilities for MTCR (Missile Technology Control Regime) class missiles or technology associated with such missiles.

Morocco trade deficit $567 mln

Morocco's trade deficit rose 51 percent to 5.91 billion dirhams ($567.4 million) in the first two months of the year, due mainly to a surge in oil imports, the Office des Changes said in a report received. The trade gap had been 3.92 billion dirhams in January-February 1999.

Oil imports jumped almost 200 percent to 2.15 billion dirhams during the first two months of 2000 compared with the same period of 1999, it said.

Total imports reached 17.59 billion dirhams against 11.67 billion dirhams in exports in the first two months of the year.

New Egypt Gulf of Suez port

The first phase of a new 750 million pound ($217 million) port north of the city of Ain Sokhna on the Gulf of Suez will start operating in September, Akhbar al Youm newspaper said.

The government-funded port is aimed at the private economic area northwest of the Gulf of Suez with the aim of attracting more investment to the area and facilitating imports and exports, the state-owned paper said. The new port, whose area is 23 sq km, is the first Egyptian port to be run by the private sector, it added.

Gulf press slam Richard's remarks

Gulf newspapers slammed French Defence Minister Alain Richard's claim that Syria will reject any Middle East peace deal that challenges its power in Lebanon.

Richard's remarks were "flagrant interference in Lebanon's internal affairs," the Emirati daily Al-Bayan said, accusing France of "siding with Israel and being unable to take a neutral position." "It shows France is not up to being a permament member of the UN Security Council," Al-Bayan said.

Emirates eyes new jumbo

Dubai-based Emirates Airline is expected to become the first customer for the 560-seat A3XX jet that Europe's Airbus Industrie consortium is developing, according to reports published Friday.

Saudi prince invests in Dead Sea resort

A Saudi billionaire and nephew of King Fahd has linked up with the Jordanian investment firm Zara to build a hotel on the Jordanian shores of the Dead Sea, a senior Zara official said.

Prince Al Waleed Bin Talal Bin Abdulaziz Al Saud will control 60 percent of the 50-million-dollar project while the rest will be held by Zara, general manager Saleh Rifai told.

Construction of the 300-room hotel will begin after the completion due in four months of a technical study, he said.

Sudan grants gold, copper concession to UAE firm

The Sudanese government has granted a concession to a United Arab Emirates company to explore for and exploit copper and gold in western Sudan, a Khartoum newspaper reported on Tuesday.

The independent Al-Sahafa said Energy and Mining Minister Awad Ahmed Al-Jaz signed the deal on Monday with Zein Abubakr Mohamed Al-Zeibeday, general manager of the UAE's Wadi Al-Rowadi group.

It quoted Zeibeday as saying the group, investing for the first time in Sudan, would begin exploring an area of about 16,000 square km (6,000 square miles) in Hufrat Al-Nahas in Southern Darfur state, when the rainy season ends in October.