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May 07 - 13, 2001

Sharp drop seen in US rice imports to Saudi Arabia

US long grain parboiled rice has lost market dominance in Saudi Arabia in favour of raw and aromatic rice from India, Pakistan and Thailand, a key regional buyer said on Sunday.

"The market share of US long-grain parboiled rice has been shrinking for some years now," Adel Al-Saleh, General Manager of Al-Muhaidib Grain, told Reuters on the sidelines at an aromatics rice conference in Dubai.

Saleh, whose firm imports about 22 per cent of the kingdom's 600,000 metric tonnes of rice per year, said Indian and Pakistani Basmati rice now accounts for 70 per cent of Saudi Arabia's total rice imports.

Out of the 602,000 metric tonnes of rice imported to Saudi Arabia in 2000, imports of Indian Sella (non-aromatic Basmati) rice stood at 225,000 tonnes, Indian White (aromatic Basmati) rice at 123,000 metric tonnes and Pakistani Basmati at 82,000 metric tonnes.

Saleh said imports of US long-grain parboiled rice to Saudi Arabia stood at 120,000 metric tonnes in 2000.

"Asian exporters have been very fast and aggressive in introducing their product to the region with consumer education campaigns and promotions," Saleh said.

"In the 1970s, the only two types of rice known to Saudis were the American long-grain and the Pakistani Pishawer rice," he said, adding that there were some 158 rice importers in the kingdom trading in various types of rice.

Traders in Bombay have said that India's aromatic Basmati rice exports were expected to decline this year because its main buyer, Saudi Arabia, had sufficient stocks.

Saleh said rice traders were facing the challenge of demand for rice surpassing supply.

Russian firms jostle for Iraqi oil

Russian oil companies are jostling to grab chunks of Iraq's huge oil reserves before the United Nations lifts sanctions on the Arab country and Western firms move in.

Russian oil firms, bolstered by Moscow's close ties with Baghdad, are keen to expand their supply base and tap into the second largest reserves in the world.

"Of course we are keen to expand our reserve base abroad and Iraq for us is a good option, not only in itself but also as a platform for the region as a whole," said Dmitry Dolgov, spokesman for LUKOIL, Russia's largest oil company.

LUKOIL was one of the first Russian firms to get involved in Iraq, agreeing in 1997 to invest $4 billion over 23 years into the huge West Qurna oilfield with total reserves of six billion tonnes. But work there has not progressed because of sanctions.

While some Western firms such as TotalFinaElf, with exclusive negotiating rights for the Majnoon and Bin Umar fields, are interested in Iraq, those projects too are frozen.

But last December Russian firm Zarubezhneft became the first company to win long-awaited UN approval to drill in Iraq to help Iraq maintain output under the UN oil-for-food programme.

It got the go-ahead for an $8 million contract to drill 45 wells while another firm Tatneft this year received a $4.8 million deal to drill 33 wells.

Slavneft said this week it would sign in May a deal to drill in the Suba field with reserves of up to 110 million tonnes (800 million barrels).

"We plan to boost our output to 20 million tonnes (400,000 bpd) by 2005 from 12 million tonnes today. A considerable part of this growth will come from our overseas fields including Iraq," said Slavneft spokeswoman Yekaterina Arkusha.

Media reports say Gazprom-affiliated Sibur and Stroitransgas are also getting into the act, while a slew of companies supply oil industry equipment. The UN approval to Zarubezhneft already opened the door for other foreign firms to apply for similar ventures.

Dawn coming for Egypt's insurance

Great expectations surround the privatisation of Egypt's state-owned insurers as potential investors hope untapped potential will spell big business.

Egypt the largest country in the Arab world with more than 65 million inhabitants and a burgeoning middle class is in the process of liberalising its insurance sector, long dominated by four state-held insurers.

The government said in early April it had a shortlist of international firms interested in buying a stake in one of the Big Four which control the lion's share of the market: direct insurers Misr, National and el-Chark, and reinsurer Egypt Re-Insurance.

Although no deadline has been set for their privatisation, time is of the essence since Egypt's membership of the World Trade Organisation requires it to complete the liberalisation of its insurance market by 2003.

US oil falls as Saudis reassure on supply

US oil prices slipped on Friday as Saudi Arabia's Oil Minister Ali al-Naimi said leading oil producers would not allow record-high gasoline prices to spin out of control.

As gasoline futures set a fresh all-time high on the New York Mercantile Exchange (NYMEX), al-Naimi said Saudi Arabia and fellow members of the Opec oil cartel will ensure US supply needs are met during peak summer driving demand.

The US is the most important client for the sale of oil. If there is a need, as sellers we have to take care of the client, he told reporters in comments translated from Arabic.

Naimi, oil minister for the world's biggest producer, was speaking as he arrived for his first face-to-face meeting with US Energy Secretary Spencer Abraham.

Concerns over a shortfall during peak summer vacation driving demand on Friday pushed NYMEX gasoline futures up more than 2 cents a gallon to a new all-time high of $1.127.

Israel awaits Syrian move in Lebanon

Locked in battle with the Palestinians, Israel appears to have bought itself a measure of quiet on the northern front with last month's air strike against a Syrian radar base in Lebanon.

The question no one in Israel can answer is how long will the Lebanon lull last? In words that came as no surprise to Israeli strategists, Syrian President Bashar Al-Assad said in an interview published in Spain's El Pais newspaper on Wednesday that a retaliatory Syrian strike, at least for now, would be counter productive.

"It doesn't look at the moment that the Syrians are going to react vehemently in a military way," a senior Foreign Ministry official said after the April 15 Israeli air raid, which killed three Syrian soldiers. But he said Syria would eventually have to act.

Iraq blames US, Britain for delaying talks with UN

Iraq has blamed the United States and Britain for delaying a second round of high-level talks with the United Nations to resolve an impasse on sanctions and arms inspectors.

Deputy Prime Minister Tareq Aziz said that the talks, which were scheduled to be held in May, had reached a deadlock.

"America and Britain are to blame for making the talks reach a deadlock because of their aggression on Iraq," Aziz, who is also acting Foreign Minister, told reporters late on Wednesday.

Security Council sources said last month that UN Secretary-General Kofi Annan had told Baghdad he was delaying an expected May meeting on the deadlock over weapons inspections and sanctions for at least a month because of deep divisions in the 15-member council.

Israel: New immigration

The Jewish Agency, the body charged with supervising immigration to Israel, hopes the next wave of newcomers will be from South America, Argentina and France, its president Salai Meridor said Thursday.

"We are concentrating our action on encouraging immigration to Israel by members of Jewish communities in developed western countries and South America, notably Argentina, South Africa and France," he told Israeli radio.

In the last 12 years, 900,000 immigrants came from the former Soviet Union and 40,000 from Ethiopia, but "these reservoirs are beginning to dry up," he said.

Ericsson wins contract

Ericsson AB and the Palestine Cellular Telecommunications Co on Thursday signed a 12-million-dollar contract to double the number of mobile telephone lines avaiable in the Palestinian territories, an official said. The contract, which also covers technology transfer and training, will increase the number of available numbers to 220,000. It was signed in the West Bank town of Ramallah.

Kuwait rules out Egypt-Israel refinery deal

Kuwait said on Monday that it was not interested in buying a stake in an Egyptian oil refinery in which Israel is a partner.

Egyptian Oil Minister Sameh Fahmy, whose country made peace with Israel in 1979, discussed offering OPEC-member Kuwait a share in the Middle East Oil Refinery (MIDOR) during a trip to the Gulf state last week.

Kuwait, like many Gulf Arab states, has no direct links to Israel and Kuwaiti Oil Minister Adel Al-Subaih said that his country was not interested in the offer.

"Kuwait will not enter into a project in which Israel is participating, directly or indirectly, and no matter how financially rewarding it is," Subaih told journalists in parliament. "We have concluded that we are not interested in participating in this project."

Syria urges speedy Arab economic integration

Syria on Sunday urged speedy efforts to achieve economic integration among all the Arab states whose combined annual Gross Domestic Product (GDP) stands at over $650 billion.

Prime Minister Mohammed Mustafa Mero, addressing a seminar on banking on behalf of President Bashar Al-Assad, said delay would make realisation of this objective more difficult.

Mero urged Arabs to follow the example of the 15-member European Union which achieved economic unity despite the differences among its countries.

Emirates to float first bond issue

Emirates is to float a 150-million-dollar bond issue in the airline's first venture into the bond market, the Dubai government-owned company's chairman announced on Wednesday.

Sheikh Ahmad bin Saeed al-Maktoum told reporters the bonds would be issued later this year, but he gave no details on the Libor-based rates of the bonds to be listed on the fledgling Dubai Financial Market. The airline posted a 24 per cent rise in net profit to 144 million dollars in 2000, a year that also saw a 19.8 per cent jump in passengers to 5.7 million and a 24.2 per cent increase in cargo to 335,194 tonnes.

Accor to add 10 new hotels

French hotel giant Accor plans to build 10 new hotels in the Middle East by 2003 to meet growing demand from leisure and business travellers to the region, a senior company executive said on Tuesday.

Christophe Jeannest, Accor's senior vice-president for world-wide sales, said the group would focus on more affordable brands as the region was becoming "over-saturated with five-star hotels".

Three of the hotels would be built in the United Arab Emirates, two in Egypt, two in Yemen and one each in Saudi Arabia, Lebanon and Bahrain.

IDB approves $151 mln in financing

The Islamic Development Bank (IDB) said on Tuesday it had approved $151 million in new financing to several member countries.

A statement from the Jeddah-based bank said the financing included $41.5 million for Egypt and $31 million for Syria to help finance power projects in both countries.

Pakistan would get $24.8 million to help finance a railway project and Algeria will receive $20.3 million for a power project, it added.

Oman Air to take loan

Oman Air, the national airline of the southern Gulf state, is to raise 80 million dollars from local banks to finance a fleet modernisation plan, the company told AFP on Monday.

Oman Air General Manager Abdulrahman Al Busaidy said the winning bank or consortium from among 10 groups, including foreign banks, will be announced within two weeks.

As part of the plan, Oman Air will acquire five next-generation Boeing 737s, of which three aircraft will be on lease.

The airline has signed a purchase agreement with Boeing for two 737s and a lease agreement with International Lease Finance Corp. for delivery from December 2001.

Gaza refugees sift rubble

Red-eyed from tears and lost sleep, Palestinian residents of the Brazil refugee camp in the southern Gaza Strip sifted through the rubble of homes and farm buildings flattened by Israeli bulldozers on Wednesday.

Many jumped from their beds in the early hours as they heard the rumble of Israeli armored bulldozers and tanks approaching from an Israeli-controlled corridor separating Gaza from Egypt.

"I was asleep when the invasion started, but when I recognized the noise of the tanks and bulldozers...I ran in my pajamas from the house. Soon the house vanished," said Palestinian farmer Mahmoud Hassan, 61.

Hassan lost his four-room dwelling and a greenhouse, along with his dream of establishing a home in Rafah for his family, who live across the border in Egypt.

Gulf Arab leaders to meet in Bahrain

Gulf Arab leaders are due to hold a one-day summit in Bahrain on May 14, a Bahraini official said on Tuesday.

"The Gulf Arab consultative summit will be held on May 14 in Bahrain," the official told Reuters.

The Gulf Cooperation Council (GCC) alliance groups Saudi Arabia, Bahrain, Qatar, the United Arab Emirates, Oman and Kuwait. The six states include some of the world's biggest oil producers.

Gulf Arab leaders have since 1999 been holding two summits instead of one to help forge closer cooperation.