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Feb 05 - 11, 2001

Iran parliament approves $57 bln budget bill

Iran's parliament on Thursday approved the budget bill for the new Iranian year starting March 21, the official IRNA news agency said on Thursday.

But state radio said MPs are due to hold an extraordinary session later in the day to debate changes in the bill demanded by Iran's constitutional watchdog body, the Guardian Council.

The conservative-dominated council appointed by supreme leader Ayatollah Ali Khamenei has the power to veto laws it says violate Iran's Islamic Sharia law.

The budget foresees spending of more than 455 trillion rials ($57 billion), an increase of some 25 per cent on this year. The government estimates a $7.5 billion surplus for the Iranian year which ends on March 20.

National security spending on the police and intelligence services is to increase by 40 per cent and defence expenditure on the armed forces and the revolutionary guards is to rise by 22 per cent. Subsidies on foodstuffs are also due to rise by some 20 per cent.

But the budget contained a number of proposed funding cuts to conservative bodies which have consistently stood in the way of reforms put forward by moderate President Mohammad Khatami and backed by his supporters who dominate parliament.

It is these cuts the Guardian Council is most likely to have objected to. Council members were outraged at a proposed 40 per cent cut to their own budget.

Khatami, elected in 1997, has seen the modest reforms of his first two years in office all but overturned in the last year by conservatives angered by increased liberalisation.

Still popular across the country, Khatami, is neverthless vulnerable to criticism of his handling of the economy.

Despite a drop in inflation from 20 per cent last year to around 15 per cent this year and a firming of the rial against world currencies, critics point out this has been achieved almost entirely by high oil prices rather than structural change.

Arab, West on opposing sides on Lockerbie

The wounds left by the Lockerbie bombing looked as raw as ever on Thursday as a "convicted killer" planned his appeal, Arabs demanded sanctions on Libya be lifted and the West insisted Tripoli had not yet earned a full pardon.

The head of the Arab League also urged the UN Security Council to "permanently lift" nine-year-old sanctions on Libya following the verdict in the Lockerbie bombing trial.

"The Security Council must take immediate steps to permanently lift the sanctions imposed on Libya," said Esmat Abdel Meguid, the secretary general of the 22-member Arab League.

"The league stresses its respect for the verdict of the court on the acquittal of one of the two accused, and on the condemnation of the second defendant," Abdel Meguid said.

Fuelled by suspicion that responsibility for 270 murders in the destruction of Pan Am Flight 103 lies at the heart of Muammar Gaddafi's state, the United States and Britain said Libya had yet to accept responsibility for the 1988 bombing and pay compensation.

Libyan secret agent Abdel Basset Al-Megrahi faced the prospect of at least 20 years in a Scottish prison for the airliner attack, after his conviction at a court in the Netherlands on Wednesday. Libyan television said he would lodge an appeal within 14 days.

His acquitted co-accused Al-Amin Khalifa Fahima was flying back from the Netherlands to Tripoli, where demonstrators chanted "down, down USA" in the streets in protest against Megrahi's conviction.

Libya denied Megrahi had acted on the orders of the Libyan state and said the verdict meant it was time for the full lifting of sanctions, a demand echoed by the 22-member state Arab league.

Sanctions have been suspended since Libya handed over the two bombing suspects in April 1999, and to impose them again would take another vote in the UN Security Council, which would probably fail. But Libya says it wants its name cleared.

Arafat meets EU envoy

Palestinian leader Yasser Arafat met with the European Union's special envoy Miguel Angel Moratinos amid efforts by current EU president Sweden to organize a summit between Arafat and Israel's caretaker Prime Minister Ehud Barak.

"The talks covered the situation following the marathon talks in Taba which failed to achieve an Israeli-Palestinian accord, and the role of Europe in the peace process," Arafat's top aide Nabil Abu Rudeina said.

A spokesman for Swedish Prime Minister Goeran Persson said Wednesday that consultations were underway to hold a summit before Israel's February 6 election but there is no confirmation that such a meeting will take place.

Iraq vice president in Syria to sign trade pact

Syrian President Bashar Al-Assad held talks with Iraqi Vice-President Taha Yassin Ramadan in Damascus on Monday, the latest step by the neighbouring states in improving ties strained for two decades.

The official Syrian news agency SANA said the two leaders would discuss "bilateral relations and the general situation in the region" over a luncheon banquet.

Ramadan, the highest ranking official to visit Syria since relations were restored in 1997, is expected to sign a free trade agreement with Damascus during his two-day visit.

The Iraqi official, one of the closest aides of President Saddam Hussein, is accompanied by a ministerial delegation that includes Foreign Minister Mohammed Saeed Al-Sahaf and Trade Minister Mohammed Mehdi Saleh.

Four Arab countries sign billion-dollar gas deal

Egypt, Lebanon, Syria and Jordan signed Sunday a billion-dollar deal for the transport and sale of natural gas between the four countries.

The agreement for the deal was signed here by Egyptian Prime Minister Atef Ebeid, his Syrian and Jordanian counterparts Mohammad Mustafa Miro and Ali Abu al-Ragheb, and Lebanese ambassador to Cairo Sami Koronfol, the official MENA agency said.

The protocol for the agreement was signed in Beirut last December by Egypt, Lebanon and Syria. Jordan joined later.

The agreement stipulates the creation of two companies.

One, which will be called Orient Company and will build gas pipelines across the Mediterranean to transport initially some 12 million cubic meters (420 nillion cubic feet) of natural gas per day from the Egyptian coastal city of El Arish to the Lebanese northern port of Tripoli.

Saudi Arabia, Iran to sign security pact

Saudi Arabia's Interior Minister Prince Nayef has said he expects to sign a security pact with Iran this month.

Prince Nayef told the official Saudi Press Agency late on Wednesday that the pact should be signed before Haj.

"It is supposed to be signed before Haj and the signing will be in Tehran. I am waiting for our Iranian brothers to set a date," he said.

Saudi Arabia says the pact aims at fighting crime, terrorism and drug trafficking and should not be seen as a regional defence pact.

Iran opposes the deployment of US and Western forces in the region and is keen to sign defence pacts with its Arab neighbours. But Gulf Arab states, which look to the West for military support, have declined Iran's offer.

Saudi Arabia has moved faster than some other Gulf Arab states in improving ties with Iran after years of mutual suspicion that followed the 1979 revolution.

Opec may further cut production

Opec will cut output further in March by 500,000 to one million barrels per day to shore up prices during the sluggish second quarter demand period, a leading energy economist said on Thursday.

It may become unavoidable to cut in March somewhere between 500,000 and one million barrels-per-day, Fereidum Fesharaki, senior fellow of the Energy Program in Hawaii, said at an industry seminar in Tokyo.

He said Opec will probably need to keep making adjustments in its output to keep prices within its crude price target range of around $25 per barrel.

Iran forecasts $20 bln in oil earnings

Iran said on Monday it expected to earn about $20 billion from crude oil exports in the year to March.

"If oil prices remain in the present mode and there are no more production cuts, we hope to earn about $20 billion by the end of the (Iranian) year," said Hojjatollah Ghanimifard, acting vice-president of the National Iranian Oil Company. The Iranian year ends on March 20.

Iran, the second largest producer within OPEC, had forecast to earn $11.5 billion from crude exports in its current budget.

Ghanimifard told the official IRNA news agency that Iranian crude had fetched an average of $25.5 a barrel during the first 10 months of the Iranian year.

WTO moot to be held in Qatar

World Trade Organization boss Mike Moore on Wednesday insisted protestors would be free to peacefully express their opposition to globalisation when ministers convene in the conservative Gulf state of Qatar. Seeking to revive the trade liberalisation drive that stalled at the Seattle fiasco, WTO members in Geneva agreed Tuesday to hold their next meeting in November in Qatar.

Oil deposits discovered

Iran has discovered a major oil deposit containing around 26 billion barrels in Gulf waters off Abadan, a senior oil industry official was quoted by state radio as saying on Wednesday.

Mehdi Mir-Moezi, deputy managing director of the Iranian National Oil Company, said the oil was found in shallow Iranian-held waters in the Dashteh Abadan zone.

He also announced discovery of a natural gas deposit containing an estimated 40 billion cubic meters (1.4 trillion cubic feet) at Rahormoz, in the province of Khuzestan, which borders Iraq.

Iran is the second largest producer in the OPEC with some 3.8 million barrels a day, but it is producing at almost the limit of its present capacity.

Kuwait defence minister to leave next government

Sheikh Salem Sabah Al-Salem Al-Sabah, defence minister and a leading member of Kuwait's ruling family, has asked to be excluded from the next government and recommended two brothers as possible replacements.

Sheikh Salem, who was also second deputy prime minister in the government that resigned on Monday, told Thursday's edition of Al-Qabas newspaper he had asked to be relieved of government duty.

He said he made the request to Crown Prince and Prime Minister Sheikh Saad Al-Abdulla Al-Sabah, who asked him to recommend a replacement.

Morocco textile in trouble, sheds 30,000 jobs

Some 30,000 Moroccan clothing textile workers lost their jobs last year as 100 cash-strapped companies shut down, L'Economiste newspaper reported Thursday.

Mohamed Lahlou, president of the Moroccan Association of Clothing Textile Industry (AMITH), told the paper that urgent measures were needed to bolster the sector.

"We have come to an extremely dangerous point and we need urgent and efficient measures for the future," he said, adding that 80 per cent of clothing textile companies "will collapse because they can't hold up anymore." Lahlou said the government had not honoured a promise to exempt employers from 50 per cent of employee benefit payouts.

Saudi Prince ups stake in Plaza hotel

Saudi billionaire Prince Alwaleed Bin Talal has raised his stake from 42 to 50 per cent in Fifth Avenue's New York Plaza hotel, his Kingdom holding company announced Tuesday.

Prince Alwaleed bought the original stake in the hotel managed by Fairmont, which has a chain of other hotels and resorts in the United States, Canada and Mexico back in 1995.

The hotel, situated on New York's fashionable Fifth Avenue, has 807 rooms, of which 96 are suites, and is valued at 1.8 billion riyals (480 million dollars, 520 million euros), the holding company said in a statement.

Kuwait to cut foreign firms tax to 25%

Oil-rich Kuwait, which is debating several laws and amendments to liberalise the economy, plans to cut tax on foreign firms to 25 per cent from the current 55 per cent, a minister said in remarks published on Saturday.

Planning Minister Mohammad Al-Duwaihess told Al-Watan daily that this had been recommended by a cabinet economic committtee set up to study and propose reforms to the state-dominated economy.

The committee had sent its recommendation to relevant authorities and the full cabinet for approval before presenting it to the country's elected parliament, the minister was quoted as saying.

UAE to invite bids for $1 bln of projects

The United Arab Emirates (UAE) will next week invite bids for desalination, power and pipeline projects worth nearly $1 billion, the state body in charge of projects said on Friday.

The UAE Offsets Group (UOG) said in a statement that 14 groups have prequalified to build a desalination unit with a capacity of 100 million gallons per day and a 100-megawatt power plant in Fujairah emirate worth an estimated $550 million.

It said 17 bidders have prequalified for a project worth about $400 million to build tanks and a 180 kilometre pipeline to carry water to the northern emirates and oasis city of Al-Ain.

Iraq and Syria plan to build new oil pipeline

Iraq and Syria plan to build a new oil pipeline to replace an old, corroding one, Iraq Oil Minister Amir Muhammed Rasheed told the government newspaper al-Jumhouriya.

"We are planning with our brothers, the Syrians, to set up a new oil pipeline because the old one is no more economical," Rasheed was quoted as saying in a report on Saturday.

Industry officials said they assumed the pipeline would replace the one running from the Kirkuk oilfield in northern Iraq to the port of Banyas on Syria's Mediterranean coast that was closed in 1982 because of Syria's support for Iran in the Iran/Iraq war.

Limits on foreign workers

Gulf Arab countries have decided to impose gradual limits on the large numbers of foreign workers they admit, the secretary general of the Gulf Cooperation Council (GCC) regional group said Friday.

Jamil Al-Hujailan said the GCC's six member countries agreed at their summit last month on "a series of measures seeking progressively to limit the number of foreign workers and achieve a demographic balance." The measures include "the placing of a quota on foreign workers by each GCC country" and "an increase on taxes in the recruitment of expatriates to dissuade local employers from resorting to this foreign labor," said Hujailan, cited by the official Saudi Press Agency.