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 5. TRADE  6. GULF



Jan-07- 13, 2002

Kuwait needs economic reforms

Kuwait economic situation needs immediate adoption of comprehensive economic reforms that eliminates the use of monetary policies to solve the country's economic difficulties , said top Kuwaiti economist Muhammad Al Duaij.

Al Duaij said Kuwait faces the challenge of creating 72,000 jobs for citizens over the next five years and 170,000 job opportunities over the next 15 years. He said this situation makes it imperative to start economic reforms immediately, otherwise Kuwait would have to liquidate some of its assets and impose taxes on services.

Al Duaij pointed out that delaying the privatization law would lead to the serious consequences to the country's economy, and expressed fears that Kuwait may be forced to devalue the dinar.

He said privatization would protect the public funds and the rights of Kuwaiti manpower. Al Duaij said that 43 per cent of Kuwaitis are youths who can be productive, and called on the government to diversify the country's sources of income so as to lesson its dependence on oil as the main source of revenue.

He said privatization is the only solution to eliminate budget deficits and will lift the heavy burden on the national budget.

Kuwait economy mostly stands on the oil revenue, which, most economists feared, would lead to the serious consequences in future. Economists are of the opinion that government should immediately adopt economic reforms to lesson the dependence on oil revenue.

Oil flirts with 7-week highs

Oil prices flirted with their highest level since mid-November on Thursday, holding firm around the 21-dollar mark as cold weather in Europe and the United States continued to spur demand.

The price of a barrel of Brent North Sea crude for February ticked up a cent to 21.01 dollars, having risen more than a dollar a barrel on Wednesday. In New York overnight, the light sweet crude February contract surged 1.17 dollars to 21.01 dollars a barrel.

Experts said prices were driven by the cold European and US winter coupled with growing confidence that Saudi Arabia was implementing output cuts agreed with the Organization of Petroleum Exporting Countries (Opec) last week.

On the demand side meanwhile, chill weather has increase consumption of crude products. The American Petroleum Institute (API) on Wednesday reported a slide of 2.45 million barrels in crude stocks.

Egyptian cabinet reshuffle of economic posts predicted

New appointments to four Egyptian cabinet posts will be announced soon, while Economy and External Trade Minister Yusef Butros-Ghali will lose his economy portfolio, government newspapers said Wednesday.

Slated for change are Minister of Technological Development and Industry, Mustafa Al-Rifai, Minister of State for the Environment Nadia Makram Ebeid, Minister of Planning and International Cooperation Ahmed Al-Darsh and Minister of Electricity and Energy Ali Al-Saidi, Al Ahram and Al-AKhbar newspapers said.

Saidi was expected to be given a new portfolio.

The reshuffle of the 32-member cabinet led by Prime Minister Atef Ebeid is to be announced by late this week or early next week, Al Akhbar said. No reason was given for the changes.

Boutros-Ghali, whom Western diplomats have seen as a driving force toward a more market-oriented economy, will retain his post as external trade minister, though he will lose his economy ministry portfolio when the ministry is abolished, the newspaper said.

It was not clear which ministry would assume the functions once carried out by the economy ministry.

On November 11, Egyptian President Hosni Mubarak announced he might bolster the role of the Central Bank amid changes he plans for the natio's economic and financial sectors.

Mubarak, who did not rule out a cabinet shakeup, said he would soon reorganize the economic sector and that he was "studying" certain ideas, including "strengthening the role of the Central Bank and its governor." Egypt's economy has been mired in a recession the last two years.

An economics expert at the Al-Ahram Center for Political and Strategic Studies, Ahmed Al-Naggar, said "such a reorganization is necessary because in the last two years, there were two differing schools on monetary policy within the government, represented by the Central Bank governor, Ismail Hassan, and the economy minister Yussef Boutros-Ghali.

Tourists flock back to Egypt for New Year

Egypt's tourism industry, hit hard by the September 11 terror attacks, got a big New Year's boost as thousands of people, including British Prime Minister Tony Blair and his family, flocked here to celebrate.

Tourist arrivals in Egypt recently increased significantly, and more than 40,000 people arrived Monday alone, the tourism ministry said in a statement on Tuesday.

Hotel occupation rates also reached record levels on New Year's Eve, with full occupancy at most places near ancient sites, the ministry added.

For the most part, the tourists are visiting the main Egyptological sites, especially near Cairo, Luxor and Asswan, as well as the Red Sea resort areas such as Sharm El-Sheikh, Taba and Dahab.

Iraq oil exports surge to 18.6 million bbl

The volume of oil exported by Iraq under UN supervision surged last week from 10.9 million to 18.6 million barrels, the office administering the United Nations oil-for-food programme said Tuesday.

In the week ending November 17, there were six loadings at Iraq's gulf port of Mina al-Bakr and five at the Turkish Mediterranean port of Ceyhan, the only export outlets authorised under sanctions imposed on Iraq after it invaded Kuwait in August 1990.

The average price of Iraqi crude during the week was about 15.65 dollars (17.70 euros) a barrel and revenue was estimated at 290 million dollars (330 million euros), the office said.

Revenue so far in the current phase of the programme, which runs from July 4 to November 30, is about 5.35 billion euros, or 4.73 billion dollars.

The price of Iraqi oil has fallen from 24.30 dollars a barrel since mid-September and early this month the office forecast that revenue for the phase as a whole was expected to reach only about 5.38 billion dollars.

Only 72 per cent of that about 3.87 billion dollars is available to pay for imports under the programme, compared with a forecast budget for the current phase of 5.5 billion dollars.

Of the revenue, 59 per cent is used to purchase humanitarian supplies and oil equipment in government-controlled areas in central and southern Iraq and 13 per cent for the northern Kurdish region, where goods are distributed by the UN.

Iraq hails oil producers cooperation, production cut

Iraqi Oil Minister Amer Mohamed Rashid hailed the cooperation between the Organisation of Petroleum Exporting Countries and non-OPEC producers, which led to a "positive" production cut.

"The position of non-OPEC member countries and their cooperation with the cartel was positive," said Rashid in an interview with the Iraqi satellite television.

"We hope to see this cooperation and coordination continue for the interest of all producers and for that of the oil market," he said.

Rashid said the "OPEC decision to reduce production is good and efficient, and we hope it would help improve prices after the fluctuation of prices during the last three months."

OPEC, which produces 40 per cent of the world's oil, agreed in November to cut its production by 1.5 million barrels per day (bpd), but only if non-OPEC rivals like Russia and Norway also cut by 500,000 bpd.

Egypt inaugurates Marsa Alam airport

The new Marsa Alam airport in southeastern Egypt, which will serve the largest marina in the Middle East, was inaugurated Monday, the Kuwaiti group which runs the two infrastructures said.

A "Condor charter flight from Munich (Germany) landed at the international Marsa Alam airport Monday with 252 tourists on board," the Kharafi company said in a statement.

Three years ago, Kharafi was granted a 40-year concession for the first international airport to be built on a build-operate-transfer basis.

The Kuwaiti company said the port, with a capacity of 1,000 yachts, will open in 2003 or 2004 in Port Ghalib, a resort on the Red Sea, near Aswan.

Lebanon denies 'assassination' story

President Lahoud Authorities in Lebanon have blocked the sale of one of the Arab world's most influential newspapers, Asharq al-Awsat, after it alleged that there had been an assassination attempt against President Emile Lahoud.

Asharq al-Awsat's office in Beirut said the authorities scanned Thursday's edition for any more offending items before the Saudi-owned daily was finally allowed to be distributed after 1300 local time.

The Lebanese national security service said that from now on the London-based paper would be granted an export and distribution licence on a day-to-day basis only.

Arab League names liberal envoy

The Arab League has appointed an Egyptian intellectual Ahmed Kamal Abul Magd as its commissioner responsible for promoting dialogue between civilisations.

Mr Abul Magd, a widely respected liberal thinker, was formerly Egypt's information minister and is a professor of international law.

His appointment comes as part of efforts to confront what is seen in the region as a Western campaign of defamation against Arabs and Muslims, in the wake of 11 September.

Correspondents say it also reflects deep Arab anxiety in the aftermath of the attacks on New York and Washington. Many Arabs feel their image and that of their religion have been severely tarnished.

Palestinian official 'kidnapped'

A former Palestinian official accused of embezzling millions of dollars from the Palestinian Liberation Organisation has been taken from a hospital bed in Cairo by Palestinian and Egyptian security forces.

The Palestinian Red Crescent in Egypt said they did not know where the businessman, Jawid al-Ghossain, had been taken.

The Palestinian ambassador to Egypt, Zuhdi al-Qudra, said that Mr al-Ghossain was being returned to Gaza on his own wishes, to continue hospital treatment.

It is reported that Mr al-Ghossain's daughter had been arranging for her father to receive medical attention in London.

Polisario to release Moroccan POWs

The Polisario Front, which is campaigning for an independent state in Western Sahara, has said it plans to release 115 Moroccan prisoners of war.

Some of the POWs have been in captivity for more than a quarter of a century.

No date has been set for their release, but it follows a request from Spain, which currently holds the presidency of the European Union.

The Polisario Front said the 115 prisoners, all of them now elderly or middle-aged men, would be handed over to the International Committee of the Red Cross.

Saudi jet fighter crashes

A Saudi Arabian jet fighter has crashed in the east of the country, killing the two pilots.

A Saudi defence ministry spokesman said the F-15 Eagle jet came down during a routine night training flight.

He said the crash was caused by a technical fault.

The impact was said to be about one-hundred-and-50 kilometres east of the King Abdul Aziz air base.

Turkish worries over Iraq attack deepen

As the traditional New Year celebrations in Turkey get under way, concern is growing over the possibility of American military intervention in neighbouring Iraq.

Turkey fears that political instability in northern Iraq could have serious effects on its own national security.

Prime Minister Bulent Ecevit is expected to raise Turkish concerns when he visits Washington in January.

Israel misses budget deadline

For the second year in succession, Israel finds itself without a budget on 1 January.

The government of Likud Prime Minister Ariel Sharon gave up on presenting it to the Knesset, the Israeli parliament, because there seemed no prospect of the fractious parties in Likud's huge coalition reaching agreement.

For the moment, Israeli law dictates that last year's budget be applied in allocating public funds until 31 March. If, by then, the budget is still stuck in the Knesset, fresh elections have to be called.

The budget process is always a difficult one in Israel, partly because a plethora of tiny special-interest parties often hold the balance of power.

That, historically, has resulted in budgets packed with special allocations for regions, ethnic groupings and other constituencies on which various members of the Knesset (MKs) depend.

Gaddafi's 'shaky start'

Secret British official papers from 1971, released in London, show that the Foreign Office thought that the Libyan leader, Colonel Muammar Gaddafi, had lost control of the Revolutionary Council in Tripoli in 1971 and was about to be overthrown.

British diplomats reported that Gaddafi had twice been the target of assassination attempts, he had had a severe nervous breakdown, and even tried to kill himself.

The files were released at the Public Record Office at Kew in south-west London.

It is now nearly 32 years since Colonel Gaddafi and other young army officers overthrew the Libyan royal family; he now looks one of the more durable Arab leaders.

Anger over Gaza killings

Israel and the Palestinian Authority have accused each other of escalating tension after six Palestinians were shot dead in the northern Gaza Strip.

Israel said three of the dead were would-be suicide bombers trying to cross into the Jewish state, while the others were planning to plant a bomb near a Jewish settlement.

Palestinian radicals have vowed to take revenge for the killings.

US envoy set for Mid-East return

The United States special envoy to the Middle East is due to return to Jerusalem on Thursday as part of renewed efforts to kickstart long-stalled peace talks.

Anthony Zinni will discuss a number of issues with Palestinian and Israeli officials, including establishing a sustainable ceasefire, and the full implementation of the US-backed Mitchell peace plan, US officials said.

General Zinni is scheduled to return to Washington early next week, where he will report to the Secretary of State, Colin Powell.

The region has been relatively calm for two weeks, but Israeli Prime Minister Ariel Sharon has reiterated a demand for a seven-day cessation of violence before any ceasefire deal will be considered.

Iran asks Pakistan, India for restraint

Iran's President Mohammad Khatami on Saturday separately phoned his Pakistani counterpart Gen Pervez Musharraf and Indian Prime Minister Atal Behari Vajpayee, inviting Islamabad and Delhi to practice restraint in the face of escalating tensions between the two countries.

The Iranian president urged the two countries to solve the ongoing crisis through peaceful means. In talks with President Musharraf, Khatami said: "I am confident that under your excellency's prudence the ongoing situation will be controlled and the crisis will be eliminated peacefully."

President Khatami expressed sympathy again over the Dec 13 terror attack on Indian Parliament and condemned terrorist acts "in whatever form and wherever" in talks with Premier Vajpayee.

Palestinian security accuses Israeli army of stabbing teenagers

Palestinian security and medical officers accused Israeli troops of purposefully beating and stabbing to death three teenagers after hitting them with tank shells four nights ago near a Jewish settlement in the northern Gaza Strip.

"The Israeli occupation troops near Beit Lahia stabbed and beat until dead the three teenagers who were injured by tank shells," said a statement from the office of General Abdel Razeq al-Majeida, the head of Palestinian security for the Gaza Strip.

"It's a huge crime in this dangerous and criminal war against international human rights," the statement said.

Iraq and Egypt bolster their free trade agreement

Iraq and Egypt signed an accord Sunday to work together on industrial, trade and technical issues, bolstering a six-month-old free trade agreement.

In a ceremony before the world's press, Iraq's Trade Minister Mohammad Mehdi Saleh and his Egyptian counterpart Yusef Butros-Ghali signed official memorandums containing the basis of the agreements.

"Both countries are determined to increase the volume of bilateral trade," Saleh said.

This reached 1.7 billion dollars (1.9 billion euros) in 2001.

Saudi women advise on marriage crisis

A Saudi Arabian all-male advisory council has taken the rare step of inviting women todiscuss the spiralling cost of marriage dowries.

It comes amid concerns that money demanded by the parents of prospective brides are prohibitively high, leaving many Saudi couples unable to get married.