Jun 19 - 25, 2000
Saudi, Mexico oil
ministers hold secret talks
Oil ministers from leading exporters Saudi Arabia and Mexico were in
private talks in the Netherlands on Wednesday to compare notes on how best to ease oil
prices that are running near record highs. Reuters reporters at the venue for the talks
said the discussions began at 1430 GMT after Saudi Arabia's Ali al-Naimi and Mexico's Luis
Tellez arrived at about midday on Wednesday at Schiphol airport.
The ministers, close allies that led a year-long campaign in 1998 to
lift low prices, were meeting just a week before OPEC is due to decide whether or not to
The Organisation of the Petroleum Exporting Countries' leading producer
Saudi Arabia wants to ease oil prices after the extra output that was supplied by OPEC in
March failed to cap a rally. US oil prices rose above $33 a barrel on Thursday as dealers
cited confusion over OPEC policy but later fell after news of the talks, ending at $32.75.
Prices have risen almost a $3 over the past three trading days. Riyadh's key non-OPEC ally
Mexico also wants lower prices and Tellez has made in recent days that he thinks OPEC
should make available additional oil to world markets. OPEC must settle its differences on
how to deal with prices that are well above its ideal range of $22-$28 a barrel.
Some other OPEC producers believe crude stocks are building quickly
enough to avoid the need for more cartel oil. They blame a shortage of new green gasoline
in the United States which on Wednesday pulled US gasoline futures to a new nine-year high
of $1.09 a gallon.
High prices have been exacerbated by OPEC's decision last week not to
implement a mechanism that would have released 500,000 barrels a day after a basket of its
crudes rose above $28.
Industry sources have said that Riyadh believes 500,000 bpd is not
enough to lower prices and that the group might need to add as much as one million barrels
daily when it meets on June 21 in Vienna.
Big economic challenges facing Syria's Bashar
A story circulating in Syria tells how Bashar Al-Assad refused to pay
four pounds out of a 14-pound ($21) taxi fare in London because he thought the driver had
not taken the most efficient route.
The swift rise of Bashar to the helm of the Syrian government in
succession to his father has raised hopes among businessmen that chronic mismanagement and
state interference in the economy will come to an end.
Bashar is seen behind recent steps to corral corruption despite his
reluctance to talk about reform in detail. He has made only general statements about the
damage corruption does to growth and the need to spread the Internet widely in Syria.
Over the past few months a number of senior officials, including a
former transport minister, have been sent to jail and their property confiscated. Hikmat
Shehabi, Syria's army chief for years, left for the United States last week after
allegedly being targeted for graft.
A new government regarded as being under the sway of Bashar came to
office in March. It amended laws in order to allow possession of foreign currency and the
full repatriation of capital in investment projects.
But private sector figures criticised this pro-investment programme as
too vague and lacking a timetable.
Syria's $18-19 billion gross domestic product places the country on a
level with Lebanon, a much smaller country with a largely free market.
The economy still relies largely on a good harvest and healthy oil
prices, the source of most government foreign exchange. At a maximum of $1,000 per capita
annually now, GDP has failed to keep up with population growth in recent years.
Iran prepared to share Caspian resources
Iranian President Mohammad Khatami told a summit of regional leaders
Saturday that Tehran was prepared to share the natural and energy resources of the Caspian
Sea in an equitable manner.
"To show our goodwill we are ready to adhere to the principle of
sharing equitably the resources of the Caspian," Khatami said at the opening of a
summit of the Economic Cooperation Organisation, which includes four of the five states
bordering the Caspian.
Previously Tehran had only called for a collective legal framework to
determine the distribution of the resources of the Caspian, which is rich in oil and gas
Khatami urged that the Caspian Cooperation Organisation, formed when
the Soviet Union broke apart to produce five littoral states instead of just two, be
reactivated to work out how a share system would operate.
Iran has refused to recognise bilateral accords on exploiting the
Caspian's oil and gas and has lost a great deal of ground to its northern neighbours,
particularly Azerbaijan, in doing deals with multinationals.
Saudi opens to applications for foreign investment
Saudi Arabia's General Investment Authority (GIA) has started accepting
applications for foreign investment licences as part of a move to open up the kingdom's
economy, the authority's head said.
The governor of the GIA, Prince Abdullah bin Faisal bin Turki, was
quoted in recent press reports as saying the first "one-stop shop" for investors
began operations on June 4 in the Red Sea city of Jeddah, with others due to follow.
The aim is to open up and make procedures speedy and transparent,"
the prince said, adding that the shops would cater for all investors in the kingdom.
The GIA was set up in April to provide the investment mechanism after
the kingdom approved a foreign investment law, allowing foreigners 100 percent ownership
of projects and ending a 49 per cent limit.
The law, aimed at promoting economic diversification in the oil-rich
kingdom, also allows foreigners ownership of related property, relaxes sponsorship rules
and lowers tax on foreign-owned projects to 30 per cent from 45 per cent.
Gulf emirate opens another free trade zone
The Gulf emirate of Ras al-Khaimah opened a free trade zone on Tuesday
aiming to attract companies which trade with Iran and boost regional commerce.
"We invite foreign-owned companies ... or individuals or groups
wishing to open a free zone establishment to explore the opportunities in Ras
al-Khaimah," the zone's president, Sheikh Faisal bin Saqr al-Qassimi, told a press
The first phase of the project cost five million dollars and covers an
industrial zone of 117 hectares (290 acres) and a technology park of 71 hectares (175
Foreign companies will be allowed 100 per cent ownership and goods will
be exempt from customs duties and companies from taxes.
"Our proximity to Iran, a large market, will be an incentive for
many international companies to open operations here," Ossama al-Omari, the zone's
project manager, said when the project was announced in May.
Yemeni official visits Iraq to discuss trade
Yemen's Transport Minister Abdul-Malek al-Sayani has arrived in Baghdad
to discuss trade deals with Iraq under the UN oil-for-food programme, Iraqi newspapers
reported on Wednesday.
They quoted the official Iraqi News Agency (INA) as saying that Sayani,
who arrived on Tuesday, would deliver a message from President Ali Abdullah Saleh of Yemen
to President Saddam Hussein.
Yemen has repeatedly called for an end to United Nations sanctions
imposed on Iraq for its 1990 invasion of Kuwait.
Yemen, one of the poorest Arab states, angered Kuwait and other Arab
nations and lost huge financial support for perceived backing of Iraq during the 1990-1991
Dubai stock market climbs
The Dubai Financial Market (DFM) index moved higher in the week to
Tuesday ending back at the level it was launched at in March after a boost from activity
on banking stocks, traders said.
The index closed at 100.00 points in a shortened week due to a public
holiday for the Prophet Mohammad's birthday on Wednesday. Last week it closed at 98.13
Saudi's new economic vision may not please the US
The recent comeback in oil prices may have given the Saudis something
to cheer about after the 1997 oil price crash when prices reached as low as $10 per
Yet Al-Saud, rulers of the Arabian Kingdom are facing up to new
realities of unprecedented socio-economic and political developments facing their country
With the world's largest oil reserves, Saudi has played and continues
to play a pivotal role on the world oil market. On the other side of the board stands the
US as the world's largest oil importer.
Over the past several decades Saudi and the US seemed to have been in
total agreement over world oil policy. But that no longer seems to be the case as the
Saudis feel the costs of such an agreement may be too high to accept.
Cairo shares plunge
Cairo share indices plunged to new year-lows on Sunday, prompted by a
collapse of key shares that provoked what brokers said was a state of panic.
Shares in one-time market leader Media Production City fell by the
maximum five per cent allowed by the bourse, or 1.97 pounds, to 37.61 in low volume of
8,547 shares. Two weeks ago the stock was trading above 50 pounds, after a late March high
over 70 pounds, in record share volumes that reached two million.
Brokers said investors were reluctant to buy as the last day for being
eligible for the firm's 18 per cent capital increase was last Thursday.
Kuwait withdrew over $80 bln from reserve fund
Kuwait has withdrawn or held back a massive 25.5 billion dinars (83.6
billion dollars) from its "Reserve Fund for Future Generations" since it was set
up in 1976, the finance minister disclosed on Sunday.
Sheikh Ahmad Abdullah Al-Sabah, in response to a parliamentary question
obtained by AFP, said a large chunk of the withdrawals was made after Iraq's invasion of
the oil-rich emirate in 1990.
The state withdrew 6.22 billion dinars (20.4 billion dollars) between
August 1990 and March 1991, the duration of Iraqi occupation, "to meet most of the
state financial requirements", he said.
By law, 10 per cent of oil-rich Kuwait's revenues are transferred into
the reserve fund.
But the Gulf Arab state failed to transfer 1.54 billion dinars (5.05
billion dollars) representing the accumulated amount in deductions from revenues between
1990 to 1999, said Sheikh Ahmad.
Expats allowed to retire in Bahrain
Bahrain has decided to allow expatriate workers to retire in the
emirate, a first in the oil-rich Gulf monarchies, as part of efforts to boost the private
sector, newspapers reported on Sunday.
The interior ministry brought the new law into effect the previous day,
laying down conditions.
"The system is being implemented in the wake of government
directives to attract foreign investment and foster the commercial, tourism and real
estate markets in Bahrain," said undersecretary Sheikh Rashid Mohammad bin Khalifa
Applicants must have worked in Bahrain for at least 15 years and hold a
minimum fixed deposit or other investment of 5,000 dinars (13,100 dollars) in Bahrain, as
well as a clean police record and health insurance.
Retired expatriates will be granted renewable five-year residency
permits under their own sponsorship, unlike foreign workers who need local
"sponsors" in the Gulf Arab states.
Iraq expects poor 2000 harvest
Iraq expects a poor harvest this year due to acute drought and a lack
of fertilisers and equipment, a senior government official said on Saturday.
"Lack of fertilisers, agricultural machinery and the means of
spraying planted areas, let alone drought, will badly affect this year's harvest,"
agriculture ministry undersecretary Basil Dalali told a news conference.
"Iraq is facing a severe drought for the second season exacerbated
by the embargo, which has very seriously affected the agriculture sector," he said.
Iraq has been isolated by UN sanctions since its 1990 invasion of Kuwait.
World Bank to investigate Industrial zone
World Bank President James Wolfensohn promised to investigate
International Finance Corporation (IFC) funding of the Jordan Gateway industrial zone to
be built along the Jordan River according to a report by the Mediterranean Free Trade Zone
The location of the project, in undeveloped rural areas on both the
Israeli and Jordanian banks of the Jordan River, has led to objections to the project by
both Israeli and Jordanian environmentalists.
Internet online banking service
Jordan based Arab bank has announced a major advance in customer
service through the introduction of an online internet online banking service, according
to a press release.
The service provides customers with a number of services, such as
accounts balance summary, account statement, fixed deposits-loans inquiry and funds
It also enables the customer to correspond with his-her branch via
secure electronic mail, order a chequebook, and change the mailing address.