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Jan 17 - 23, 2000

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

Kuwait stocks slip 1.05 pct in a week

Kuwaiti stocks fell 1.05 percent in a week which saw only two days of trading owing to the Muslim holiday of Eid Al-Fitr.

The Kuwait Stock Exchange (KSE) index ended the week to Wednesday down 15 points at 1,412.5 points. This is 50.2 percent lower than an all-time high recorded in November 1997.

The KSE, the second largest Arab market by capitalisation, declined steadily through most of 1999. Some economists said the decline was due to a severe confidence crisis and feuds among some of Kuwait's key investors.

Trading value this week fell to 5.90 million dinars ($19.42 million), a daily average of 2.95 million dinars. The daily average was almost 14 million dinars in 1998.

Gulf businesses slammed for ignoring internal IT departments

One of Saudi Arabia's most prominent MIS managers, Tony Whitsey, of AW Aujan, has heavily criticised the region's businesses over their inability to understand the role of their IT departments. Behind his feelings on the subject was that, despite the now huge influence that IT enjoys over business, the same could not be said about the status of the departments within business responsible for delivering IT.

'Since so many businesses around the Middle East, and Saudi Arabia in particular, are owner managed and led as "family" enterprises, there is little realisation or understanding of the impact any investment in IT will make,' Whitsey told itparabia.com. 'Consequently, executives and investors only have regard for the cost of the investment, rather than the kind of return they should either expect or are looking for.'

Oman aluminium plant study done

A feasibility study for a proposed $2.5 billion aluminum smelter in Oman has been successfully completed and an implementation review is underway, a project official said.

"The baseline study has been successfully completed and now we are entering the second stage of identifying different technologies and the financial mechanism that would be applied to the project," Tony Kemp, business development manager for W.J. Towell, told Reuters.

W.J. Towell and National Trading Company, joint local agents for the project due to be built in the northern city of Sohar, conducted the feasibilty study.

W.J. Towell is a diversified Omani trading firm with stakes in several local industries, some of which have multinational partners. It also has a stake in the country's first private power plant, in which National Trading Co is also a partner.

Tunisia 1999 trade deficit widens to 3.09 bln dnrs

Tunisia's goods trade deficit in 1999 totalled 3.09 billion dinars ($2.49 billion), up from 2.97 billion dinars in 1998, statistics bureau trade figures showed on Thursday.

Coverage rate of imports by exports was 69.3 percent compared with 68.7 percent.

Exports were worth 6.967 billion dinars, up 6.9 percent from 6.518 billion dinars. Imports were worth 10.060 billion dinars, up 6.0 percent from 9.490 billion dinars.

The statistics bureau said food exports in 1999 rose 26.1 percent over 1998, mainly due to the surge in exports of olive oil worth 382.8 million dinars.

Textiles exports, Tunisia's leading goods sales, were up only 2.3 percent while exports of mechanical and electrical goods rose by 7.4 percent and that of energy by 19.2 percent.

Imports of food, mainly cereals, were down 18.9 percent while those of equipment goods surged by 21.4 percent.

Kuwait, UAE agree to link ATM networks

Kuwait and the United Arab Emirates have agreed to link their Automated Teller Machine (ATM) networks, the official Kuwait News Agency (KUNA) reported on Wednesday.

Kuwait Central Bank Governor, Shaikh Salem Abdul-Aziz Al-Sabah, told KUNA the agreement was part of plans to link the networks of all Gulf Arab states.

Late last year, Bahrain linked its ATM network with those of Kuwait and the UAE.

Dubai's first private power plant planned

Dubai Investments Park Development Co (DIPD) said on Wednesday it would build the emirate's first private power plant to supply an industrial and residential complex it was building near Jebel Ali port in the United Arab Emirates.

"We aim to sign the contract document with the final party by the end of May and construction should start soon thereafter," Khaled bin Kalban, the firm's chief executive officer, said in a statement. Kalban said the plant's capacity would be between 120 and 150 megawatt. DIPD announced in 1998 that work had started on the first phase of the 1.5 billion dirham ($408 million) project which would include land for industry, employee accommodation, residential and office space and an 18-hole golf course.

Kalban said a build-operate-transfer (B.O.T) contract for a 5,000 cubic metres a day waste water treatment plant had been awarded to US firm Metito to service the golf course and residential areas.

Palestinians set up financial watchdog

The Palestinian Authority said on Wednesday that it had set up a new body to oversee financial management and bring greater transparency to its affairs.

The establishment of the "Higher Development Council" by Palestinian President Yasser Arafat was welcomed by diplomats from countries whose governments and institutions provide substantial sums in aid to self-rule Palestinian areas.

Saudi Prince interested in stake in KirchPay-TV

Billionaire Saudi Prince Alwaleed Bin Talal is interested in taking a stake in the German pay television group, KirchPay-TV GmbH und Co KGaA, Kirch channels Premiere World said on Tuesday. Walid would probably be interested in taking a three-percent stake in the company, which controls a number of different pay-TV channels, including Premiere World which was launched in October, a spokesman for Premiere World said.

He declined to indicate how much the prince had offered to buy the stake.

The Saudi billionaire already holds a stake of 3.1 percent in KirchMedia, the company in charge of Kirch's licencing, commercial TV, programme production and film activities.

On December 6, BSkyB, the British group controlled by Rupert Murdoch, took a 24-percent stake in KirchPay-TV.

Oman to reactivate trade links with Israel

The Gulf state of Oman has decided to reactivate trade links with Israel in a sign of warmer ties between the Jewish state and the Arab world, an Israeli foreign ministry official said on Monday.

He said two Omani diplomats who are on a week-long visit to Israel had told the ministry, Muscat would reopen its commercial mission in Tel Aviv after three years of inactivity inspired by frustration at the lack of Middle East peace progress.

Arab economies in the 21st Century, prospects and challenges

In a century that witnessed the rise and fall of communism, coupled with the sweeping precedence of US capitalism, we bid farewell to 100 years of conflict that has no doubt been governed by economic powers.

The liberalization of trade barriers, the inauguration of free market policies, the birth of globalization, the prevalence of the US currency (dollar) and super high-tech technologies are what make this century a turning point worth pondering.

Amidst this bonanza of economic evolution, Jordanian economists, along with their Middle Eastern counterparts, are marvelling at their "crawling" economies and questioning the credibility of their economic systems opposed to reigning powers.

Economists believe that many Arab countries have failed to break the ice, lagging behind other developing countries in different parts of the world.

"The region's weak economic performance was due to a combination of external and internal aspects," Dr Henry Azzam, a well-known economist, told The Star.

These aspects revolve around the slow implementation of economic reforms, inability to compete effectively in global markets, absence of a regional economic vision, coupled with the stagnation of the Middle East peace process.

Statistics show that the total GDP of the Arab countries has reached $1.2 billion in 1998, almost half of Italy's GDP.

"The region's per capita GDP growth was barely positive during the nineties, annually averaging 0.6 percent, that is below the average for developing countries, which is 1.8 percent," Azzam pointed out.

Azzam believes that "with the advent of a new century, people are hoping for drastic changes to come forth on all economic levels." Arab countries, said Azzam, have failed in the past 20 years to pursue a regional economic vision.

Iran's supreme leader urges Islamic solution to economic woes

Iran's supreme leader, Ayatollah Ali Khamenei, said on Sunday that the country should look to Islam and its own history rather than the West for a solution to its economic problems.

"The country's problems, particularly its economic problems, should be solved by looking to Islam and the Iranian history and people," Khamenei said in a speech in the holy city of Qom, state radio reported.

"We must reject the Western model," Khamenei said in the speech marking the anniversary of an uprising in the city in the run-up to the 1979 Islamic revolution.

Over the past two years Iran has been left with severe budget shortfalls of between five and six billion dollars as crude prices tumbled on the worldwide market, rebounding only after OPEC agreed last March to production cutbacks.

The reformist goverment of President Mohammad Khatami has sought to tackle the resulting economic problems with an ambitious programme of privatizations and efforts to wean the economy away from dependence on oil and attract sorely needed foreign investment.

But the privatization programme as well as a raft of price hikes intended to help balance the budget have run into trouble with conservatives, who still control both parliament and the powerful constitutional watchdog body, the Council of Guardians.

Foreign investors have also been wary about putting capital into the Islamic republic even though parliament adopted a bill in 1998 guaranteeing the security of foreign investments.

Egypt to sell 70 state companies worth $3.49 bln

Egypt's public enterprise minister said on Wednesday that 70 public sector companies will be offered for sale and 62 ailing firms restructured as part of the ministry's working agenda for 2000, the Al-Ahram newspaper said.

Mokhtar Khattab was quoted in the daily Al-Ahram newspaper as saying the companies' total market value was 12 billion pounds ($3.49 billion), adding that the privatisation plan gives priority to companies that produce goods and services.

Khattab said the plan to restructure ailing companies depended on implementing early retirement schemes for 46,490 workers at a cost of 4.220 billion pounds and on settling the firms' debts, worth three billion pounds, with Egypt's four largest public sector banks.

Turkey earns $23.5 mln in Sept-Dec Iraqi diesel tax

Turkey earned 12.6 trillion lira ($23.5 million) in revenues in the first four months of a tax imposed on trade in Iraqi diesel imports, state-run Anatolian news agency said on Tuesday.

Turkish truck drivers cross between southeast Turkey and the neighbouring Kurdish-held enclave of northern Iraq, taking food there and returning with cheap Iraqi diesel for domestic sale.

The trade is a technical breach of a United Nations embargo imposed on Iraq after its 1990 invasion of Kuwait but Turkey's Western allies turn a blind eye to it.

Sanctions on Baghdad have cost Turkey billions of dollars in lost trade as Iraq was formerly its second biggest trading partner.

Kuwait looks to levy taxes on private companies

Kuwait's cabinet has approved in principle a draft bill to tax companies in a bid to finance a proposed fund to help Kuwaitis find employment in the private sector, a newspaper reported Tuesday.

"The (employment) fund can only be financed through imposing taxes. The council of ministers has given a provisional approval to a tax bill. We have sent the bill to other government bodies for their opinion", Finance Minister Shaikh Ahmad Abdullah Al-Ahmad al-Sabah told the Al-Watan paper.

Jordan King stresses economic revitalization

King Abdullah of Jordan on Sunday received head and members of the Jordanian negotiating team to the talks for accession to WTO.

His Majesty expressed his appreciation to the delegation's remarkable efforts and accomplishments achieved. He affirmed the necessity of pooling the efforts of both private and public sectors to get the fruits of Jordan's accession to WTO, and to be a country attractive to foreign investment, as well as able of achieving the required economic growth.