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May 22 - 28, 2000

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

Richardson must walk tight rope when lobbying OPEC

US Energy Secretary Bill Richardson risks fighting a losing battle if he thinks he can again convince the OPEC cartel to raise oil production and cool red-hot prices, industry analysts said on Tuesday.

Richardson said earlier Tuesday the Clinton administration was nervous about rising oil prices and that more OPEC oil may be needed to calm prices which have shot back to $30 in the United States in recent days.

But while his aggressive lobbying helped to persuade OPEC release an extra 1.7 million barrels per day (bpd) at its last meeting in March, Richardson stands little chance of repeating the trick at the group's upcoming June 21 conference, analysts say.

PFC's Zanoyan said Richardson's high-profile lobbying of OPEC backfired among some cartel members, particularly Iran, who viewed it as Washington interfering with the cartel's business.

OPEC has already sent out strong signals that it has no plans to raise output again in June, preferring to wait until September before taking more action.

Ali Al-Naimi, Oil Minister of OPEC powerhouse Saudi Arabia said on Tuesday that he saw no need to increase supply now.

These days Richardson is making several phone calls a week to OPEC oil ministers, instead of the previous three a day, his aides told Reuters.

He has met recently with some ministers — including OPEC President Ali Rodriguez of Venezuela — in the United States, but does not plan to travel to any OPEC countries at this point.

"Sending messages behind the scenes, that is very responsible," Zanoyan said.

Jordan gets $115 mln loan

Jordan has received a 115-million-dollar loan from the Kuwait-based Arab Fund for Economic and Social Development to build a dam to boost its meager water resources, officials said on Wednesday.

The loan was signed Tuesday and covers more than half of the overall cost of the Al Wahdeh Dam on the Yarmuk River in northern Jordan, which is estimated at 210 million dollars.

According to terms of the accord Jordan will pay back the loan over the next 16 years with a 4.5 per cent interest rate and has been granted a six-year grace period, the official Petra news agency reported.

Lebanon planning $400 mln Eurobond

Lebanon is planning to launch a $400 million Eurobond in June or even before, Finance Minister Georges Corm said.

He said Lebanon was considering a fixed or a floating rate for the issue and if the government decided on the floating rate option it would be Lebanon's first issue of this sort.

A finance ministry official said the lead managers of the June issue would be either Merril Lynch or Morgan Stanley.

Qatar in talks with Bahrain on gas supply

Qatar's Energy and Mines Minister Abdullah bin Hamad Al-Attiyah said on Thursday the oil-and gas-rich Gulf Arab state was in talks with neighbouring Bahrain on a gas supply agreement.

"We have discussions with Bahrain, as with others... The gas pipeline going to Kuwait (from Qatar) is very appropriate to have (to supply) Bahrain at the same time," Al-Attiyah told a conference in Paris on Qatar investment opportunities.

The minister said he believed a gas grid for the six-nation Gulf Cooperation Council (GCC) was a genuine possibility in the near future.

"I am confident that we will see the GCC Gulf pipeline... It will go to the (United Arab) Emirates, Oman, Kuwait and Bahrain.

Saudi Prince's stake in US companies

Prince Alaweed bin Talal raised the value of his technology, media, and telecommunications portfolio this week to $7.8billion, with the announcement that he has invested $1 billion in 15 American companies, including 6 Internet firms and 2 telcoms. The motivation for the Saudi billionaire's decision was simple: he merely wanted to diversify his portfolio away from what he describes as "old economy stocks." A statement from the Prince's Kingdom Holding Company in Riyadh said his investments included $50 million each in Internet firms Amazon.com, eBay, Internet Capital Group, Priceline.com, InfoSpace.com, andDoubleclick.

"We decided that if I need a basket of Internet companies, then those are the ones," said the Prince. "Internet is here to stay. People have to be selective in what stocks that they choose."

The statement added that the new investment also includes takes of $50 million each in Coca-Cola, Pepsi, McDonald's, Walt Disney, Ford Motor, Gillette and Procter & Gamble. His largest purchases were a $200 million stake in telecommunications giant WorldCom, as well as $150 million worth of AT&T.

Syria to allow bail for most economic crimes

Syrian President Hafez Al-Assad signed a decree Sunday allowing bail for people charged with economic crimes, setting aside a 30-year-old part of Syria's penal code, the official SANA news agency said.

Justice Minister Nabil Khatib said the decree was in the spirit of "recent economic and social measures meant to assure the citizens' security." Just one day earlier, Assad signed a decree to encourage local and overseas investment and lifted a ban on individuals holding foreign currency, which was until then punishable by up to 10 years in prison.

Syria and Iraq to promote economic cooperation

Iraqi Trade Minister Mohammed Mehdi Saleh met Syrian officials on Wednesday for talks on ways to promote economic cooperation within the framework of the oil-for-food deal between Baghdad and the United Nations.

Officials said Saleh held separate talks with Mohammed Imadi, economy and foreign trade minister, and Makram Obeid, transport minister, on how to increase Baghdad's imports from Syria which amounted to $300 million last year.

The talks also covered ways of facilitating Iraq's transit trade through Syrian ports on the Mediterranean covering mainly wheat, sugar, rice and other commodities coming especially from Europe and the Americas.

Officials said Saleh's talks with Imadi dealt with issues related to contracts covering the purchase of medicines and food from Syria.

Speaking to reporters after the talks Saleh stressed the importance of promoting economic cooperation with its Arab neighbour adding "we in Iraq are interested in increasing our imports from Syria and we believe there are good prospects for achieving this purpose." Saleh's visit comes after both states opened diplomatic interests sections in Damascus and Baghdad last month.

The move came two years after both states, ruled by rival factions of the Baath Party, agreed to reopen their borders following 18 years of closure and to engage in economic cooperation in line with the oil-for-food deal.

Diplomatic ties between Syria and Iraq broke down with the start of the 1980-1988 Iraq-Iran war in which Syria sided with Tehran. Relations worsened after Syria joined a US-led multinational force that drove Iraqi troops from Kuwait in 1991 after six months of occupation.

But Syria recently supported calls for the removal of sanctions imposed on Baghdad following its invasion of Kuwait.

Kuwait hikes discount rate to 7.25 pct

The Central Bank of Kuwait (CBK) has increased its discount rate by half a point to 7.25 per cent amid positive economic indicators in this oil-rich emirate, the official KUNA news agency reported Thursday.

The decision was taken "in the framework of the bank`s follow-up on the developments in the local and international interest rates to safeguard monetary stability in Kuwait," CBK governor Sheikh Salem Abdel Aziz al-Sabah said.

The increase came into effect on Wednesday but after the Kuwait Stock Exchange (KSE) had closed for the week, the agency said.

In March 1999, CBK lowered its discount rate by half a point to 6.75 per cent, but had since resisted tremendous pressure by private businesses to cut interest rates further.

Foreign investors get 67 pct of Tunisia sell-offs

Foreign investors had bought 67 per cent of the assets in Tunisia's privatisation programme as of the end of March 2000, a government report showed on Tuesday.

Since the privatisation programme had started in 1987, foreign investors paid a total 853 million dinars, including 720 million dinars for the purchase of three cement factories, 76 million dinars in the trading sector, 28 million dinars in the tourism sector, and 16.5 million dinars in the transport sector.

The share of foreign investment in revenues from privatisation was 58 per cent at end of 1998.

Total proceeds from privatisation amounted to 1,268 million dinars ($916 million) for the programme that involved 138 firms, the report, obtained by Reuters, said.

Lebanon trade deficit

Lebanon's trade deficit narrowed in April to $433 million from $457 million in March, the customs authority said in a report on Wednesday.

Last month, the customs authority gave a different figure, saying the deficit in March was larger at $471 million.

In April 1999, the deficit was $482 million. Lebanon ended 1999 with a trade deficit of $5.53 billion compared to $6.3 billion in 1998.

The report said revenues from customs tariffs fell to 146.57 billion Lebanese pounds ($97.2 million) in April from 150 billion pounds in March.

Egypt eyes 10mn visitors

Egypt's tourism industry is witnessing record growth, according to a report recently published by the Egyptian Ministry of Tourism. The report cites the rising number of tourists, and the influx of foreign investment in luxury properties, as the key reasons for Egypt's growing prominence as a popular holiday destination in the world.

According to the report, more than 4.8 million people visited Egypt in 1999, staying 31 million room nights, bringing in a total revenue of US$4 billion. Nearly two thirds of the visitors (66%) were from Europe. The second largest group of visitors was comprised of Arabs (22%), the majority of whom are citizens of the Gulf Cooperation Council.

Doha plans 'Qatarisation' of energy sector

Qatar will from June 1 implement a five-year plan to boost to 50 per cent the number of Qatari nationals working for 18 energy sector companies in the emirate, newspapers reported Wednesday.

Energy Minister Abdullah Al-Attiyah stressed the "Qatarisation Plan" would not have a negative impact on employment of expatriates as he expected "very significant" growth in the energy sector over the next five years, the Gulf Times said.

"I think this is an achievable target. This is very important for our country and I have been instructed by the emir (Sheikh Hamad bin Khalifa Al-Thani) to undertake this five-year plan," Attiyah said.

Saudi imports at $16.5 billion

Saudi Arabia imports amounted to 62 billion riyals ($16.5 billion) in the first half of 1999, down 9.4 per cent from the same period the previous year, the official Saudi Press Agency reported.