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Jan 24 - 30, 2000

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

Oil surges in U.S. as OPEC stays tough

Oil prices in the United States were running at nine-year highs with no sign yet of respite from Opec producers who are keeping a tight rein on exports.

New York Mercantile Exchange light crude futures hit $29.10 a barrel in early trading the highest oil price since January 1991.

Dealers said the recommendation from a number of Opec ministers last week that the organisation extend output curbs beyond a scheduled end-March expiry remains the driving force behind the price rise.

"These countries are openly saying that they want to keep the oil supply-demand balance tight," said Mike Rothman of Merrill Lynch.

"The Saudis are signalling that they want to defend oil at $25 a barrel. "

Saudi Arabian Oil Minister Ali Al Naimi, Opec's most influential policy maker, said last week that he was content with market conditions and could see no reason to change production policy for the remainder of 2000.

Other producers have suggested extending current policy to September. Opec is scheduled to decide policy at a meeting in Vienna on March 27.

Added impetus for prices came from a severe cold spell in the northeastern United States, the world's largest market for the petroleum product. Nymex heating oil has jumped 13 cents a gallon in just eight days to reach 77.65 cents.

Opec's agreement of March 1999 removing 4.3 million barrels a day from the 75 million bpd world market has already left world petroleum inventories previously close to historic lows.

The American Petroleum Institute said that U.S. crude stocks fell nearly 13 per cent during 1999 to end the year at the 30-year low set at end-1996.

JTC finalises deal with French firm

Jordan will sign a $508 million deal to sell 40 per cent of its flagship telecoms firm to a consortium led by France Telecom in its boldest privatization move so far, investment bankers said. The deal to sell the stake in Jordan Telecommunications Co (JTC) will be signed at a ceremony attended by the French firm's chairman Michel Bon the bankers close to the deaf said.

Syria okayed Israeli demands

Syria agreed in past peace talks with Israel to most demands made by the Jewish state to normalise relations between the two sides, according to Uri Saguy, Israel's chief negotiator in peace talks with Syria.

The claims — in an academic paper made public on Thursday -- contradict Syrian assertions Israel must agree to give up all of the Golan Heights captured in battle 33 years ago, before there can be any discussion of normal relations.

Interbank rate drops to 11 pct

The median overnight interbank rate on Egypt's pound slipped to 11 percent on Thursday, the end of the business week, from Wednesday's 16 percent in a very liquid market, bankers said.

Overnight rates were in a wide range of eight to 14 percent compared with 15 to 17 percent on Wednesday.

One-week rates ranged between 11 and 16 percent from Wednesday's 15 and 17-1/2 percent.

Sudan ups state salaries

Sudan's government has increased the salaries of state workers by at least 27 percent to keep pace with rising petrol and food prices, a newspaper reported on Thursday.

President Omar Hassan Al-Bashir has issued a decree to raise the minimum state pay to 20,000 Sudanese pounds ($8) a month with effect from January 1, the independent Al-Usbua said.

Labour unions had complained about a 16 percent rise in petrol prices on January 11. Food prices have risen sharply since the Muslim fasting month of Ramadan ended on January 7.

The government has said it aims to reduce inflation to nine percent by the end of 2000 from an official rate of 13 percent last September.

Qatar bourse to open to foreign investment

Qatar's stock exchange will be opened up to foreign investors this year in a bid to improve liquidity, its director was quoted as saying Thursday by a newspaper in the United Arab Emirates.

The market would be opened up "during the first quarter" to direct investment from other Gulf Arab states, Hussein Abdullah said in an interview with the Al-Ittihad daily.

Other foreigners would be allowed to invest "during the second quarter", but only indirectly through investment funds whose creation is still being studied, he added.

Meat industry

Bahrain plans to privatise its meat industry and set up a two million dinar ($5.3 million) joint firm to take over government activities in the import of livestock, a local newspaper said on Thursday.

The Gulf Daily News quoted Commerce Minister Ali Saleh Al-Saleh as saying the shareholding of the Bahrain Live Animal Company would be held equally by the government and three trading firms.

Israel stockpiled medical specimens from Arab leaders

Israeli intelligence services have secretly stockpiled medical information about the Arab leaders. An Israeli newspaper reported that the Mossad and other Israeli intelligence organisations had obtained the results of medical tests conducted on several Arab leaders, including heads of states considered hostile to Israel.

These leaders had undergone medical treatments. The newspaper said the Mossad's medical bank even includes a urine sample clandestinely taken from Syrian President Hafez Al-Assad.

Detailed information about the health of Palestinian leader Yasser Arafat indicated that while he is not healthy, there is no immediate risk to his life, Maariv said.

Israel is currently engaged in a peace process with both Syria and the Palestinians.

Iran, Turkey discuss "threat" of Israeli planes

Iranian Foreign Minister Kamal Kharrazi had talks on Monday with Turkish Prime Minister Bulent Ecevit and a Turkish official said they discussed Turkey's growing ties with Israel which are causing concern in Tehran.

Ecevit also raised Turkey's long-standing accusations that Tehran tacitly backs Turkish Kurd rebels fighting a 15-year-old armed campaign in southeast Turkey, the official said.

Further details of the talks between the two most populous states in the region were not immediately available, but Iranian state radio said Tehran was concerned about possible attacks by Israeli warplanes which train in Turkey and fly close to Iran's borders.

Khatami, Castro, to exchange visits

Iranian President Mohammad Khatami will go to Cuba in April and Cuban leader Fidel Castro will make a return visit to Iran later this year, according to Havana's ambassador to Tehran, Dario Urra Torriente.

Khatami will attend a meeting of the Group of 77 developing countries taking place in Havana, Torriente said in an interview published Sunday in the conservative daily Teheran Times.

The two visits would be the first by either head of state to the other's country, though former Iranian president Ali Khamenei, now Iran's supreme spiritual leader, met Castro at the Non-Aligned summit in Zimbabwe in 1986.

Iran welcomes Saudi direct mining and metals investment

Iranian Minister for Mines and Metals Eshagh Jahangiri said Wednesday his country welcomed direct investment from Saudi Arabia in the mining sector, the official IRNA agency reported.

The Iranian minister made the statement during a meeting with Saudi Trade Minister Ossama bin Jaafar bin Ibrahim Faqih, who started a visit to Tehran.

The Saudi minister said that the joint economic commission must identify joint objectives in order to boost trade.

The two oil exporting countries recently expressed their political will to "reinforce economic and trade cooperation," particularly as part of a joint investment plan.

Iran and Saudi Arabia have 12 joint projects, worth an estimated total 280 million dollars, of which the Saudis hold 77.29 percent and Iran 12.82 percent.

Tehran has decided to open its mining and metals sector, which is the most significant after oil, to direct foreign investment.

Oman Sohar port project

Oman's planned 96 million rial ($250 million) port project in the northern city of Sohar will cost around 40 percent less than expected when it was announced last year, a project official said on Tuesday.

Kuwaiti stocks crash

The Kuwait Stock Exchange (KSE) dipped another seven points to close the week Wednesday at its lowest point for almost four years, as weak trade sentiment continued to depress investor confidence.

The KSE index closed at 1,388.0 points, down 0.4 percent from its 1999 record low and a staggering 51.1 percent from its peak just over two years ago.

Saudi businessmen to form investment firm

A group of leading Saudi Arabian businessmen are setting up a company to invest in foreign countries and buy Saudi government stakes in some foreign joint ventures, the founders said on Monday.

Founding members of the company, who did not want to be named, told Reuters discussions among the more than 20 leading businessmen had so far agreed on an initial paid-up capital of 100 million riyals ($26.7 million).

Suggestions by some businessmen that they raise the total to one billion riyals had not yet been agreed on, they said.

Kuwait seizes two ships

Kuwait's coast guard has seized two ships en route from Iraq for alleged sanctions-busting, the interior ministry. The coast guard "has seized two wooden ships coming from Iraq in violation of the economic embargo, one of them flying the Indian flag and the other the flag of Honduras," it said, quoted by the official KUNA news agency.

Bahrain, Sudan sign cooperation accords

Bahrain and Sudan on Saturday signed a series of agreements, mostly trade-related, on the first day of a visit here by Sudanese President Omar Al-Beshir, the official GNA news agency said.

The first accord establishes a joint cooperation committee, charged with developing bilateral cooperation in the fields of economics, trade, culture, science and technology.

Another agreement covers the encouragement and protection of investments. The third is a double taxation accord.

Algerian denies US immigration charges in Seattle

An Algerian-born man reported to have connections with key figures in an apparent plot to smuggle bomb-making materials into the United States, pleaded not guilty to immigration charges on Thursday.

A federal grand jury last week indicted Abdel Tizegha, 29, on two counts of allegedly entering the United States illegally from Canada, where he had apparently gone to live after being denied political asylum by U.S. authorities.

Jordan economy: peace has yet to deliver

Lebanese and Syrians are eagerly awaiting the economic boost they are convinced will come with peace. But in Jordan, many have realised that the 1994 peace treaty has not brought much hope and is even being countered by a campaign against normalisation with Israel.

In a lecture delivered in the United States last October, Jordan's deputy prime minister and minister of planning Rima Khalaf pointed out that Jordan's economy was doing better before the peace treaty and since 1994, the country's gross domestic product (gdp) had fallen from 10 percent to 1.5 percent.

Khalaf seems to imply, almost directly, that stagnation of Jordan's economy is a direct consequence of the absence of peace dividends.

"Exports to Israel and Palestinian territories, anticipated to reach 400 million US dollars by 1999, came up to a mere 58 million dollars, because of tariff barriers erected by Israel, (which is) also impeding flow of goods and transfer of technology to Jordan," said Khalaf.

"The anti-normalisation movement in Jordan, which did not exist in 1994, is a direct consequence of the absence of qualitative peace," she added, referring to the campaign that was launched by the National Conference to Fight Normalisation (NCFN), created in 1995."

The difference in peace with Israel for Jordan and Syria is that Hafez Al Assad will probably ask for a much higher price to put his signature on a treaty with Israel than the late King Hussein of Jordan did.

Jordan had some of its debt to the US erased, it received foreign aid and Washington increased its annual aid from 9 million dollars to 225 million dollars.

Saudi, Iran plan to strengthen trade

Saudi Commerce Minister Ossama bin Jaafar bin Ibrahim Faqih will travel to Tehran Monday for two days of meetings on boosting bilateral trade and cooperation, the official SPA news agency said.

The minister will lead a delegation of businessmen to the meetings of the joint Saudi-Iranian committee Tuesday and Wednesday.

During the committee's meeting in Riyadh in December, the two countries agreed to encourage investment in joint projects, increase trade and hold reciprocal fairs.

Saudi-Iranian ties, cool since Iran's 1979 Islamic revolution, improved after Iran's reformist President Mohammed Khatami was elected in 1997.