Economy Minister Kemal Dervis — the architect of
his country's economic recovery — also submitted his resignation but
later withdrew it at the request of Prime Minister Bulent Ecevit and
President Ahmet Necdet Sezer.
The US Treasury says it is closely monitoring events
in Turkey — a key regional ally.
"We encourage the government of Turkey to
continue implementation of its economic reform package and we anticipate
that it will," a spokesman said.
Correspondents say the crisis could have
repercussions for Turkey's bid for European Union membership and
The resignations are seen as highly damaging to the
authority of Mr Ecevit, who is increasingly isolated and ailing.
In total eight ministers have now walked out since
the start of this week. More than 35 MPs have also quit Mr Ecevit's
Democratic Left Party (DSP) in protest at his refusal to step down.
The prime minister tried to stage a fight back on
Thursday, calling on party defectors to return and saying they had
"fallen into a trap".
"I call on these friends to unite again under
the wings of the white dove," he said in a written statement,
referring to his party's symbol.
But the BBC's Jonny Dymond, in Istanbul, says there
is now enormous pressure on Mr Ecevit to resign.
UAE OIL INCOME TO SWELL BY OVER $2B
The UAE's oil income will swell by more than $2
billion this year to exceed $16 billion despite an expected decline in
average crude prices. But it will slip back again next year, according
to a Western economic report.
From $14.5 billion in 2001, the UAE's oil export
earnings will grow to around $16.8 billion in 2002 although the average
price of North Sea Brent crude is expected to slide from around $23.1 to
$22, the London-based Middle East Monitor (MEM) bulletin said.
The bulletin, citing estimates by the UAE Ministry of
Economy and Commerce, the International Monetary Fund and the World
Bank, said higher revenues would be a result of an increase in the UAE's
production of crude oil and condensates from an average 2.2 million
barrels per day to around 2.4 million bpd.
Although production is forecast to be maintained in
2003, revenues are expected to decline to around $14.9 billion because
of a projected price drop to nearly $20 a barrel.
The high income will nearly double the UAE's trade
balance surplus to around $8.6 billion this year from $4.3 billion in
2001 but the surplus in the current account is projected to recede to
around $4.9 billion from $5.5 billion in the same period.
MEM, part of the Business Monitor International
information group, forecast a 2.5 per cent nominal contraction in the
country's gross domestic product from around $58.9 billion in 2001 to
nearly $57.7 billion in 2002. But it projected a surge of 8.5 per cent
to $62.3 billion in 2003 although crude prices will slip to $20 and the
UAE's oil output will remain unchanged.
MEM's figures showed the UAE's economy jumped by 27.2
per cent to $66 billion in nominal terms in 2000 when oil prices shot up
to $27.6. The trade surplus also peaked at around $11.3 billion and the
current account recorded a mammoth surplus of $9.1 billion, accounting
for as high as 13.9 per cent of the GDP.
SAUDI EQUITY-DEBT PLAN ALLAYS MART FEARS
Saudi Arabia's plan to pay part of its hefty $170
billion domestic debt in equity has allayed fears that privatisation
could dent prices and absorb liquidity from the stock market, economists
"It is a very smart move. It has allayed fears
about share prices and liquidity drain," Alhassan Goussous, head of
investment services at Saudi British Bank, told Reuters.
"It amounts to a reduction of debts on the
balance sheets. In any case, most of the companies they've been talking
about are already listed," said Goussous.
In June, the kingdom's Supreme Economic Council
pushed forward stalled privatisation plans and approved a sell-off
strategy for water desalination, postal services and railways.
The market slipped 1.5 per cent on the council's
move, but shares have risen since Finance Minister Ibrahim Al Assaf's
announcement of the equity-for-debt plan.
IRAN SELLS FIRST GLOBAL BOND SINCE 1979
Iran borrowed 500 million euros via an international
bond sale, its first such transaction since the 1979 Islamic Revolution.
But recent weakness across emerging markets, and the
controversial withdrawal last month of its credit rating by U.S. rating
firm Moody's Investors Service, meant the Muslim state's borrowing cost
was higher than it had hoped.
The rating withdrawal had raised doubts about Iran's
ability to borrow. Moody's cited U.S. government concerns that the
rating was "inconsistent" with 20-year-old American sanctions
against Iran, which President Bush in January identified alongside Iraq
and North Korea as forming an "axis of evil".
London-based Fitch Ratings affirmed Iran's
sub-investment grade B+ rating but said geopolitical risk, including
relations with the U.S., continued to constrain its rating. Moody's had
assigned a roughly equivalent B2 grade.
Launched via the central bank, Bank Markazi,
five-year bond paid a coupon of 8.75 per cent, about 0.75 points more
than initially expected.
UNDP CALLS FOR CLOSER INTER-ARAB COOPERATION
The United Nations Development Programme (UNDP) has
called for closer inter-Arab cooperation and economic integration to
survive and compete with the rest of the world.
In its first annual Arab Human Development Report (HDR)
for 2002, the UNDP said Arab countries have what it takes to attain
adequate living standards for all their people, but they need to achieve
economic integration and deepen inter-Arab trade to overcome dependency
and vulnerability and make globalisation work for their interests.
PROPOSAL TO SET UP SIX CHARITY PROJECTS
The Projects Committee at the Mohammed bin Rashid Al
Maktoum Charity and Humanitarian Foundation has recommended
implementation of six charity projects in several African countries
including mosques, religious schools, health centres and orphanages.
The committee, which recently convened at the
foundation's headquarters under the chairmanship of Engineer Ahmed
Hassan Al Rostamani, Board of Trustees Member and Head of the Committee,
has made the recommendation to the Board of Trustees of the foundation.
PLAN TO ATTACK IRAQ IN PLACE
The United States will inform its allies in the Gulf
Cooperation Council (GCC) in advance about its plans to attack Iraq, a
senior US General was quoted by newspapers as saying.
Amidst apprehensions that the US is preparing to
launch military strikes against Iraq to overthrow President Saddam
Hussein's government, the US air force chief, Gen John P. Jumper, has
said the US would go ahead with its plans even if regional governments
oppose the move and do not allow US troops the use of their facilities.
He said the US troops were capable of deployment
outside the region and using other bases to attack targets inside Iraq.
UAE FAIR OPENS IN MOROCCO
Prince Rashid, brother of King Mohammed VI of
Morocco, opened the UAE fair in Morocco, which is being held under the
patronage of Deputy Prime Minister Sheikh Sultan bin Zayed Al Nahyan.
About 35 companies and a number of government organisations are
participating in the fair, which is being organised by the General
Exhibition Corporation (GEC) in collaboration with the UAE Federation of
Chambers of Commerce and Industry, the Ministry of Economy and Commerce
and the Ministry of Finance and Industry.
UAE PROVIDES SYRIA EXPERTISE
The UAE has offered Syria its experience and
expertise in combating desertification and the country's efforts to meet
the increasing agriculture and water demands to strengthen the basic
infrastructure of the agriculture sector.
DAHLAN WILL NOT RUN AGAINST ARAFAT
Mohammed Dahlan, who was appointed on Wednesday as
National Security Advisor at the Palestinian National Authority (PNA),
says he will not stand against President Yasser Arafat in a leadership
Although he has been a critical of Arafat's handling
of the intifada, Dahlan has told the Britain's Guardian newspaper last
week: "As long as the Israelis are against Arafat, I'm with him
whatever reservations I have about some of the decisions that have been
Q-TEL INKS DEAL WITH GTSS
Qatar Telecommunications (Q-Tel) has signed a Dh92
million ($25 million), global system for mobile (GSM) communications
network infrastructure expansion deal with Motorola's Global Telecom
Solutions Sector (GTSS).
KUWAIT'S GULF BANK
Kuwait-based Gulf Bank has received its first ever
rating from Standard & Poor's (S&P), which has given it a stable
outlook. The rating agency has also given 'Triple - B plus long-term'
and 'A-2 short-term on counterparty credit and certificate of deposits.
EMNEX MAKES MARGINAL GAIN
The Emnex made a marginal gain to close the week,
through a 0.67 point upswing to 2,007.07. Market capitalisation by the
end was Dh104.56 million.
The financial services index was up 0.8 points to
2,184.73, while Islamic gained 1.11 points to 944.44 and property was
1.37 points higher at 761.44.
The Telecom and insurance remained intact at 1.064.68
points and 1,213.63 points respectively.
DUBAI ISLAMIC BANK
The Dubai Islamic Bank (DIB) has expanded its
operational network in the UAE with the opening of its second branch in
Al Ain and the announcement of its plans to set up four more branches in
other parts of the country.
ISRAELIS KILL TOP MILITANT
The Palestinian militant group Islamic Jihad says one
of its leading members has been killed in a dawn raid by Israeli special
TIES WITH UAE MAKING STEADY PROGRESS — IRAN
A spokesman of the Iranian government described
relations between the UAE and Iran as "good and making steady
During his weekly press briefing, Abdullah Ramadan
Zadah said that a date has not been fixed yet for the visit to the UAE
by Iranian President Mohammed Khatami, but went on to say that relations
between the two countries are positive and moving in the right direction
of strengthening bilateral cooperation.
With unemployment running at around 20 per cent in
Saudi Arabia, the Kingdom is faced with the daunting task of finding
employment for its ever growing number of youth.
By announcing to nationalise the work force in 22 new
categories, authorities in Riyadh are once again indicating that they
are serious in resolving this issue.
SHARJAH, AJMAN IN OIL DEAL
A unique unitisation — or joint petroleum
production sharing — agreement was signed between Sharjah and Ajman to
joint develop the Zora field, a gas reservoir located around 40
kilometres off the two coasts. The pact is believed only the second of
its nature in the Gulf between two governments.
BANK SADERAT IRAN
Bank Saderat Iran (BSI), which operates eight
branches in the UAE, has recently increased its capital base to Dh400
million from Dh180 million.
GCC AUTOMOBILE MARKET
Closely mirroring wider economic sentiments, the
Gulf's automobile market continues to remain flat, according to a senior
"It is becoming more difficult to operate than
in earlier years," said Per Rasmussen, president and chief
executive of DaimlerChrysler ME.
His forecasts are for DaimlerChrysler to maintain the
25,000 units sold in the region for 2002.
GOLD PROMOTION BECOMES A BIG HIT
The Double Chance Gold promotion run by the Gold and
Jewellery Group has so far resulted in Dh105 million in sales and
350,000 raffle coupons given to customers.
The promotion started on June 20, which is equally
successful among expatriates and visitors, will run until July 31.