GULF

 

Oct 28 - Nov 03 , 2002

 

1.INTERNATIONAL

2. INDUSTRY

3. FINANCE

4. POLICY

5. TRADE

6. GULF

 

UAE SET TO LIFT TEXTILE BAN

The UAE is set to lift an eight-year-old ban on the establishment of new ready-made garment and textile factories in line with rules by the World Trade Organisation (WTO) requiring member states to tear down financial and trade barriers.

The Ministry of Finance and Industry has sent a letter to federal government offices and clothes factory owners asking for proposals on the re-opening of one of the most important non-oil industrial sectors to local and foreign investors.

Ministry sources said they were awaiting a response to their suggestions to partially remove the restrictions before they completely end the ban on new projects in this sector, which has attracted more than $200 million in national and foreign capital.

"The plan to lift the ban on building new garment factories is still under study. We have sent a memorandum to all parties concerned asking for their comments and proposals in this regard," said Raafat Mugharbel, an economist at the ministry.

"This survey is aimed at finding the best way to re-open the garment industry to new investment. The plans are, of course, prompted by external factors, including the WTO."

Alarmed by a surge in unskilled labour and excessive production, the UAE suspended licences for new clothes factories in 1994 and set export quotas for factories following complaints from the United States and others about dumping of cheap products.

Investment in garments and other industries in the UAE is highly feasible given the abundance of cheap labour and energy and its location in the heart of a vast Asian market of more than a billion consumers.

Dubai's vast port facilities and tax incentives have also given rise to export-oriented projects, mainly light manufacturing materials.

GAS INDUSTRY ENHANCES QATAR'S DEVELOPMENT

The gas industry is transforming the Qatari economy. Its development has provided the country an opportunity to diversify the economy away from oil.

Qatar's gas development stems from hard facts: its natural gas reserves amount to 500 trillion cubic feet, equivalent to 100 billion barrels of crude oil, similar to the UAE's oil reserves.

The country has the third largest gas reserves in the world after Russia and Iran. But, recently, Minister of Energy and Industry Abdullah bin Hamad Al Attiyah revised upward the reserves to 900 trillion cubic feet.

Discovered in 1971, Qatar's North Field is the single largest reservoir of non-associated gas in the world. Work on exploring North Field gas began in 1987 but encountered delay due to technical problems and the Gulf War in 1990.

The North Field project is divided into three phases. Completed in 1992, phase 1 extracts natural gas for power generation and other industrial projects.

Phase 2 involves exporting gas to other Gulf states, which encountered problems from the start. But a breakthrough came in 2001 when Abu Dhabi based Dolphin Energy Ltd spearheaded a campaign to pump up to 2 billion cubic feet per day of North Field gas to the UAE by 2006 for 25 years.

Several international firms are involved in the $3.5 billion project, which could be expanded into Oman. Additionally, Qatar hopes to export around 800 million to 1.4 billion cubic feet per day to Kuwait and 500 million to 1 billion cubic feet per day to Bahrain.

Phase three, which involves exporting liquefied natural gas (LNG) to Europe and East Asia, has moved faster than the second one.

Qatar Liquefied Gas Co (QatarGas) and Ras Laffan Qatar Liquefied Gas Co (RasGas) are exporting LNG to clients in Japan and South Korea, respectively.

U.S., BRITAIN ADAMANT ON 'USE OF FORCE'

United Kingdom and the United States still seem to be adamant on the phrase of "the credible threat of the use of force" in the draft currently discussed by Security Council member states on Iraq.

While refusing to be drawn to discuss the content of a joint UK-US draft resolution, distributed to all 15 Security Council members, British Foreign Office spokesman confirmed to Gulf News that London and Washington have not altered their position in this respect.

This position was made absolutely clear by British Foreign Secretary Jack Straw when he met with the IAEA's Dr Muhammad El Baradei.

Straw is believed to have stressed that any resolution by the Security Council should show Iraqi President Saddam Hussan the firm determination of the United Nations this time.

U.S. INACTION POISONS ARAB OPINION SAUD

Saudi Arabia has said Washington's failure to curb Israel's military actions against Palestinians was poisoning Arab attitudes towards America.

Foreign Minister Prince Saud Al Faisal said in a Reuters interview that U.S. silence over Israeli military actions, using U.S.-supplied weaponry, was having the opposite effect.

But he was optimistic there would not be an attack on Iraq, because of U.S. willingness to work through the United Nations. He said the fate of President Saddam Hussain "is the business of the Iraqi people. The people who will be affected are the Iraqi people."

Asked about anti-American attitudes in Saudi Arabia, one of the oldest U.S. allies in the region and a key member of the 1991 Gulf war alliance against Iraq, Prince Saud said only one thing prompted criticism and that was U.S. support for Israel.

SAUDI ARABIA 'URGED TO SPEED UP REFORM'

The International Monetary Fund (IMF) has reportedly warned Saudi Arabia to speed up reforms in order to strengthen its oil-dependent and volatile economy.

The IMF told Saudi officials that inaction would result in less foreign investment and more pressure on public finances, according to a leaked report seen by the Financial Times.

The report was compiled following meetings between Saudi authorities and the IMF several months ago, and was not intended to be made public.

The IMF is reported to have recommended the following changes to the way Saudi Arabia's economy is managed:

Cuts in government spending, introduction of income tax for both expatriates and nationals, establishment of a timetable for privatisations.

But each of these proposed changes is controversial.

VENEZUELA SAYS NO TO ARAB OIL BLOCKADE

Venezuela, the world's fifth biggest oil producer and major supplier to the US, will not support an Arab oil blockade in response to military action against Iraq.

Venezuelan President Hugo Chavez told BBC News Online during a visit to the UK that Arab producers would have to work within the Organisation of Petroleum Export Countries (Opec).

"We cannot endorse any oil embargo, we cannot use oil as a political weapon and Opec should be fully aware of this," Mr Chavez said.

Venezuela weakened the Arab oil embargo in 1973 by filling the gap with its own reserves.

Libya and Iraq have been the main proponents of an Arab oil embargo, while Iran has said it would consider one because of Israeli actions against Palestinians. Saudi Arabia has said it would not support a blockade.

IRAQI OIL

The volume of oil exported by Iraq under UN supervision averaged 3.03 million barrels a day, a record since the start of the oil-for-food programme almost six years ago, the UN said. In the week, Iraq exported 21.2 million barrels of crude for revenue estimated at $547 million, the office administering the programme said. The previous record, 19.4 million barrels, was reached in ending October 20, 2000, when sales netted 508 million dollars.

BAHRAIN POLL

Twenty-seven years after it was dissolved by the government, Bahrainis, men and women, voted for a new legislature that is part of a political reform project launched two years ago by His Majesty the King, Sheikh Hamad bin Isa Al Khalifa.

More than half of Bahrain's 243,499 registered voters have ignored an opposition boycott and cast their ballots in the elections for the 40-member House of Deputies, Information minister said.

BANKS ACCUSED OF FORGERY

Two banks in Sharjah and Dubai have been accused by the Ministry of Labour and Social Affairs of having allegedly forged bank guarantee certificates.

One of the banks admitted indirectly that it had "unintentionally" committed some mistakes in the serial number of the certificates, while the other bank rejected any connection with the case and said that the certificates in question, about which the ministry inquired, are not registered with it.

MOHAMMED INAUGURATES FAIRMONT

The Fairmont Dubai, a Dh800 million five-star hotel, was inaugurated by General Sheikh Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and UAE Minister of Defence.

ISRAELI TANKS ENTER JENIN

Israel troops backed by dozens of tanks entered the West Bank town of Jenin.

An Israeli commander quoted by Reuters news agency said it was the biggest security operation since one launched in Nablus in August.

Palestinian eyewitnesses said the Israelis were in the town itself and its adjoining refugee camp they are reported to be carrying out house-to-house searches.

LIBYA TO LEAVE ARAB LEAGUE

Reports from Tripoli quote officials as saying Libya has informed the Arab League of its decision to withdraw from the organisation.

But in Cairo, the secretary-general of the pan-Arab body, Amr Moussa, told the BBC he is in constant contact with the authorities in Libya and has yet to receive any official notification of a withdrawal.

Libyan officials are being reported as saying that the Arab League's inefficiency in dealing with the crises over Iraq and the Palestinians as the reason for this move.

IRAN OPENS UP MOBILE PHONE MARKET

Iran plans to open its mobile telephone market to foreign firms, in a move that would end the state's monopoly in the telecoms sector, a report has said.

"We have decided to allow foreign private mobile phone operators into the field from March 2004," Ali Kermanshah, deputy minister of the telecoms ministry told the news agency Reuters.

The presence of foreign firms would help Iranian mobile phone users move beyond "the limited capacity and sometimes inefficiency of the governmental sector".

US RICE FARMERS SEAL IRAN EXPORT DEAL

A co-operative of US farmers has sold rice to Iran in the first such deal since President Bill Clinton barred exports to the country seven years ago, a report said.

"We sold them high quality long grain rice, and it was the first sale of US rice to Iran since 1995," Riceland Foods spokesman Bill Reed told news agency Reuters.

The $1.4m rice shipment could pave the way for renewed trade relations with Iran, even though President George W Bush has retained economic sanctions and insisted that Iran was part of an "axis of evil".

GCC SET TO REMOVE TRADE HURDLES

GCC Ministers of Commerce and Industry have agreed to remove all obstacles to trade exchange between their countries by next year and apply an anti-dumping law from early next year.

In statement at the end of the 21st meeting of the Industrial Cooperation Committee, which consists of GCC ministers of commerce and industry, Maqbool bin Ali Sultan, Oman's Minister of Commerce and Industry, said: "The ministers have set next year as the maximum time frame for removing all barriers to trade exchange and it was agreed that the secretariat general coordinate on this matter with member states which all had shown desire to take that step."

WAR MUST BE AVERTED ZAYED

President His Highness Sheikh Zayed bin Sultan Al Nahyan received UN Secretary-General Kofi Annan and discussed with him the latest developments on the international and regional scenes, including the Iraqi and Palestinian issues. They also discussed war against terrorism.

The president reiterated the need to uphold international law in resolving conflicts in the world. He said that war, which is destructive to both the victor and the vanquished, must be averted at all costs, and that wisdom and peaceful means must be the order of the day.

MINIBUS PLANT

An Egyptian car manufacturer will establish a bus plant in the Ajman Free Zone, according to Abdullah Mohammed Hussein, Egyptian commercial counsellor. The plant is expected to produce 50 buses a month for the local market and export, he added.

BANKMUSCAT

BankMuscat has reported a net profit of 18.5 million Omani riyals for the first nine months of this year. Net profit soared by 67.8 per cent to 18.494 million riyals compared with 11.016 million in 2001.

RIYADH SPENDS $33B

Saudi Arabia maintained its addiction to overshooting expenditure to forestall a damaging slowdown in its oil-reliant economy and pumped nearly $33 billion in additional spending during its sixth development plan that ended in 1999, economists said.