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Mar 05 - 11, 2001

Syria approves free trade deal with Iraq

Syria's parliament has approved the establishment of a free trade zone with Iraq and called for greater economic cooperation with Baghdad after two decades of animosity, officials said on Thursday.

They said the deal, signed initially in Damascus on January 31 by Iraqi Vice-President Taha Yassin Ramadan and Syrian Prime Minister Mohammed Mustafa Mero, was unanimously approved by the 250-member People's Assembly on Wednesday evening.

Analysts described the accord as the latest phase in the rapprochement between the neighbours, which has included resumption of diplomatic ties and the reopening of land and air transportation links.

Ties between Iraq and Syria, ruled by rival factions of the Arab Baath Socialist Party, were cut off for the first time after the outbreak of the 1980-1988 Iraq-Iran war, in which Damascus sided with Tehran.

Syria joined a US-led multinational alliance which drove Iraqi occupation troops out of Kuwait in 1991. But it agreed to resume economic and commercial cooperation with Baghdad in 1997, under the oil-for-food programme signed between Iraq and the United Nations that allows Iraq to sell some oil for humanitarian purposes while sanctions are in place. Approval of the free-trade agreement followed a visit to Damascus on Monday by US Secretary of State Colin Powell, in which he called for preservation of the UN economic sanctions imposed on Iraq following its invasion of Kuwait in 1990.

Powell said after talks with President Bashar Al-Assad that Syria had agreed to put under UN inspection an oil pipeline carrying Iraqi oil to the Mediterranean and Iraqi oil supplies to Syria, estimated at 100,000 barrels per day.

A Syrian official told Reuters on Thursday that while respecting UN resolutions, Syria is calling for an end to the economic sanctions imposed on Baghdad.

Turkish premier meet on economic crisis

Senior Turkish World Bank official Kemal Dervis flew to Ankara on Thursday for talks with the prime minister that many hope will herald the formation of a new economic team capable of resolving the country's crisis.

"I believe Turkish society is very strong and will overcome all these problems... Of course we will come out, there's no doubt about that," Dervis said. He declined to comment on reports he had been offered the job of central bank governor or a cabinet post. "I will do my best to help," he said.

Dervis went immediately to Prime Minister Bulent Ecevit's office to discuss a financial crisis that has slashed the value of the lira by a quarter and left an IMF-backed disinflation programme in tatters. After a short meeting he left with little comment, saying talks would continue on Friday.

Turkish media reported Ecevit wanted to make him central bank governor, but World Bank sources in Washington said Dervis would move to Ankara only for a full cabinet-level position.

Dervis brushed off suggestions that he was bringing a set of pre-conditions to the talks. "My having conditions is not an issue," he said after meeting Ecevit.

Stocks rose seven per cent and the lira had a better day as markets bet Dervis would restore some confidence.

"The name is respectable in international markets. I'd hope if he comes it's not only as central bank chief but also in an advisory position that's clear of the politicians," said Burak Akbulut, a strategist with Bayindir Securities.

The central bank governor and treasury chief, both closely associated with the abandoned IMF-backed programme, have resigned over the crisis but no ministers have lost their jobs.

Parliament in Qatar within two years

Qatar's Amir Sheikh Hamad bin Khalifa al Thani said in remarks published on Tuesday that his country was planning to establish a parliament within a year-and-a-half.

Sheikh Hamad, in remarks to a German radio station excerpts of which were published by Qatari newspapers, said: "The state of Qatar started municipal elections two-and-a-half years ago. The process was calm and now we are tending to establish a parliament.

"I'll be glad that all authority won't be in my hands...it's as simple as this. I believe that this is in the interest of our homeland and the next generations," Sheikh Hamad said in response to a question on the division of powers.

Annan: A common policy towards Iraq is needed

With major Security Council powers at odds over policies toward Iraq, UN Secretary-General Kofi Annan appealed for unity so he could negotiate properly with Baghdad officials in the future.

Reporting on two days of talks with an Iraqi government delegation this week, Annan acknowledged late on Wednesday that no new proposals had emerged to break the impasse over sanctions and UN weapons inspections. Instead, the Iraqis had submitted a stack of documents to show why the decade-old sweeping embargoes should be dropped immediately.

Given the intense nature of discussions among council members, and US Secretary of State Colin Powell's recent trip to the Middle East, Annan said he hoped the 15-member body could agree "on certain critical questions and to restore unity" before his next round of talks in April or May.

He spoke to reporters after briefing the Security Council.

Syria-Iraq oil pipeline still flowing

Oil continues to flow from Iraq to Syria despite frequent denials that the pipeline linking them is in use, industry and trade sources said on Tuesday.

But they said the volume of crude moving between the two countries had reduced.

A Syrian source told Reuters Iraqi crude oil was still flowing through the pipeline, which was reopened last November after 18 years of disuse.

But the rate of pumping had slowed.

"It's not as much as 170,000 bpd," he said, but declined to be drawn on a more precise volume.

Both Damascus and Baghdad have vigorously denied regular shipments of Iraqi oil via the Iraq-Syria pipeline, which has not been approved by the United Nations. US and UK officials have said they would likely okay its use if asked.

"There is no pumping of oil from Iraq to Syria," Iraq Foreign Minister Mohammed Saeed Al-Sahaf said at the United Nations on Tuesday.

Bahrain opens property market to foreigners

Bahrain has opened sectors of its property market to foreigners as part of measures to liberalise the economy and attract investment from abroad, the government announced in a decree published on Wednesday.

Certain areas, mostly in Manama but also tourism and investment zones, were specified where non-Bahraini nationals can own land and build both commercial and residential properties in the Gulf Arab archipelago.

Despite strong competition from Dubai in the United Arab Emirates, Bahrain remains the Gulf's financial centre and the emir, Sheikh Hamad bin Issa al-Khalifa, has pressed ahead with economic liberalisation since coming to power in 1999.

D-8 FMs sign accord

Foreign ministers of D-8 have signed an agreement on facilitating entry visa procedures for businessmen among the member states.

Egyptian Foreign Minister Amr Moussa, who presided over a meeting of the D-8 foreign ministers on Sunday, said the agreement "is aimed at removing red tape in order to help business councils among the member countries access D-8 markets."

Solidarity against rich states pledged

The leaders of eight Muslim developing nations with a combined population of 800 million vowed on Sunday to take up the challenges of globalization and join forces to face the developed states of the World Trade Organization (WTO).

Two of those leaders, host Egyptian President Hosni Mubarak and Bangladeshi Prime Minister Sheikh Hasina Wajed, called for a fair distribution of the wealth generated by globalization and trade development at the D-8 (D for development) summit.

"A truly globalized world has to be based on give and take and a better understanding of the mutuality of interests" between developed countries and developing ones, said the outgoing president of the grouping, Sheikh Hasina.

"We want a win-win outcome of the fruits of globalization", she said at the Cairo gathering.

Qatar Airways opts A380

Doha-based, Qatar Airways, became the 9th launch customer of world's largest aircraft A380 when it ordered two planes with two options, a communication received from Tolouse said on Thursday.

Besides acquiring the Airbus' all new very large airliner Qatar Airways have placed firm orders for five of the highly successful A330-200 with three options.

Launched in December 2000, the twin-deck A380 with a seating capacity of 550 passengers has todate won 66 firm commitments from nine customers plus 54 options.

Qatar Airways plans to start a regular service to Iraq once insurance problems are ironed out, joining a host of flights to Baghdad despite the UN air embargo, a newspaper reported on Wednesday.

Tele Liban station goes off air

Tele Liban went off-air in the early hours of Thursday after the Lebanese government decided to shut the loss-making television station and dismiss its 523 employees.

The station, which was founded in 1959, became the first casualty of a new policy by the debt-ridden government of Prime Minister Rafik Al-Hariri to cut the size of the bureaucracy.

Hariri, who returned to office last year, had promised not to sack government workers. He subsequently bowed to market pressure to control the $23 billion debt by reducing government spending.

Tele Liban lost $33 million annually. It will cost the government a similar amount to pay indemnity for its employees.

Iraq lifts trade boycott of Poland

Iraq on Wednesday lifted a boycott of Polish goods imposed last week, saying Warsaw had "rectified" its stand on the deadly US and British air strikes earlier this month.

"Iraq has annulled the boycott measures against imports from Poland after the Warsaw government rectified its attitude" towards the February raids, Commerce Minister Mohammad Mehdi Saleh announced, quoted by the official news agency INA.

Egypt bonds quiet amid high interbank rates

The Egyptian bond market is expected to remain quiet this week amid rising interbank rates and liquidity shortages, analysts said.

"I don't think the market adjusts according to supply, demand and interbank, and this is due mainly to lack of liquidity," said Moustafa Assal, head of fixed income at ABN AMRO Delta. Uncertainty still lingers concerning the direction of interest rates and opaque economic policy, analysts said. The median overnight interbank rate on Egypt's pound stood at 12-1/4 per cent on Monday in a short to moderate market, bankers said. The interbank market is the main source of liquidity for banks.

National Bank of Dubai stock split approved

Shareholders of the National Bank of Dubai (NBD) approved a ten-for-one stock split. The shareholders also approved the board's proposal to maintain the cash dividend at 40 per cent. The bank saw net profit rising marginally from Dh404.15 million to Dh408.99 million in 2000.

Although interest income rose from Dh1.3 billion to Dh1.63 billion, it was not reflected in the net interest income due to the high interest expense of Dh1.11 billion the bank incurred compared to Dhs782 million in 1999. The bank remains highly liquid as demonstrated by the proportion of liquid assets to deposits, which stands at 86.86 per cent. While loans and advances grew marginally from Dh6.86 billion to Dh6.98 billion, growth in customer deposits was relatively high rising from Dh18.56 billion to Dh21.3 billion.

UK meat export ban to have minimal impact on UAE

Britain's ban on exports of all livestock and animal products is unlikely to have much impact in the UAE where a ban on British beef and cattle is already in place. The latest health scare to hit the UK food industry involves an outbreak of foot and mouth disease among pigs. Pork products are available in special supermarket sections for non-Muslims in the UAE, but most pork products are imported from other European countries.

Khalid Sharif, head of the Food Control Section, said the Municipality was evaluating the market stock of British pork and other meat products, but did not expect supplies to be significant. "We can't issue a statement until all the information has been obtained," he said. "But the quantity of British meat, such as pork, that's imported into Dubai is quite low.