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Dec 12 - 18, 2005

TEHRAN AIR TRAGEDY

An ill-fated C-130 military aircraft destined for Bandar Abbas crashed into a residential area of Tehran Tuesday last. In the tragic event, a number of military personnel and newsmen, who were on board to cover military maneuvers in the Persian Gulf, and people on the ground lost their lives.

At press time, there were still varying figures on the number of casualties. However, it has been confirmed that all 84 passengers and ten crewmen on board died instantly as the plane caught fire. Reporters and cameramen at the scene wept because they knew their colleagues were on board. An Interior Ministry spokesman said several people had been killed on the ground.

The names of the victims have been released, and 40 were from Islamic Republic of Iran Broadcasting (IRIB). Reporters from the IRNA, ISNA, and Fars news agencies and from several newspapers were also killed in the crash.

A total of 116 bodies have been recovered, Interior Ministry spokesman Mojtaba Mir-Abdolahi said. IRIB put the death toll at "around 110".

The plane suffered engine failure and its wings hit an apartment block in the Shahrak-e Towhid neighborhood, setting a high-rise block ablaze. The residential area, which lies on the flight path to Tehran's Mehrabad airport, houses military men and their families.

A local police commander, Nasser Shabani, said many of the dead on the ground were trapped in the nine-story building and died of asphyxiation due to smoke inhalation or were burned to death.

"Some people were throwing themselves out of windows to escape the flames. I saw two die like that," Reuters quoted a policeman as saying.

Another policeman said several children were among the dead in the apartment block. Schools had been closed for the day because of dangerous pollution levels in the capital.

In a message to the nation, President Mahmud Ahmadinejad, who was on an official visit to Saudi Arabia to take part in an Organization of the Islamic Conference (OIC) meeting in the holy city of Mecca, offered his condolences. According to the message, a copy of which was obtained by the Tehran Times, the president said, "Upon arrival in the holy city of Mecca, as I was circling the Kaaba, I heard about the plane crash and the martyrdom of a number of our compatriots, the educated, media people, and military men."

In a message to Supreme Leader of the Islamic Revolution Ayatollah Seyyed Ali Khamenei, Minister of Culture and Islamic Guidance Mohammad-Hossein Saffar-Harandi expressed his condolences on the tragic plane crash, especially over the death of many members of the news media.

According to military officials, the main cause of the crash of the aging U.S.-built C-130 was the fact that the United States has placed sanctions on the Islamic Republic banning the sale of airplane spare parts to Iran.

OIC SUMMIT

Custodian of the Two Holy Mosques King Abdullah has urged Muslim countries to open a new era of unity, strength and glory by setting aside their differences and working together for their overall progress. He also wanted to see an end to extremism, projecting the beauty of Islamic tolerance.

Opening the third extraordinary OIC summit, King Abdullah also urged all member states of the Organization of the Islamic Conference to join the global fight against terrorism without sitting as helpless observers. He stressed the need for developing educational curricula and overhauling the Islamic Fiqh Academy to combat extremist ideologies and thoughts.

In his keynote speech, Abdullah was trying his best to instill confidence in Muslim leaders and urged them to carry out comprehensive development programs to eradicate poverty. "Revival begins with a hope, which turns into an idea and then becomes an objective," he explained.

Abdullah, however, reminded Muslims and their leaders of the great Qur'anic verse which states that "Allah will never change the situation of any people until they first change themselves." He also said that Allah would support those who support Him, quoting another verse that urges Muslims to work hard following His teachings.

He said the summit, which was attended by the heads of state of most OIC member countries, offered the glad tidings of a bright future for the Islamic nation. He thanked the leaders for accepting his invitation, adding that it reflected their strong desire to move forward and make change for the better.

He said the Islamic world has the potential to achieve its objectives. "I look forward to a united Muslim Ummah, having good governance that eliminates injustice and oppression," he said. "Let us work together to make this summit a milestone, heralding a brighter future for the Ummah."

Abdullah urged Muslim leaders to strengthen their cooperation in economic, political, cultural and social domains in order to achieve real unity and establish powerful institutions to enable the Ummah to restore its rightful place in the world.

OIC Secretary-General Professor Ekmeleddin Ihsanoglu presented a detailed report on the organization and its achievements. He thanked King Abdullah for establishing the organization's headquarters at a strategic location in Jeddah. At the end of the opening session, King Abdullah unveiled the plaque of the organization's new headquarters. The imprints of the right palms of all participating leaders were later taken using advanced equipment in order to project them on a commemorative plaque in front of the new headquarters, as a symbol of Islamic unity.

In his speech, the king called for greater scientific and technological advancement in the Muslim world. He also advised Muslim youth to work hard for the betterment of their life in this world and the world to come, without excesses or negligence.

Speaking on the need for developing educational curricula in the Muslim world, the king said it was a prerequisite for building a Muslim personality. "Steeped in tolerance, such a personality would lay the foundations for a society that rejects isolationism and turns its back on courting hostility to the other by interacting with all peoples, adopting what is good and rejecting what is bad."

Abdullah underlined the role played by the Islamic civilization in lighting the way forth for other civilizations, offering them a fine example of tolerance and justice, and leading humanity forward through its singular achievements in jurisprudence, science and literature.

"Indeed, it is these major contributions that provided the decisive catalyst in bringing enlightenment to the Dark Ages," the king stressed.

King Abdullah decried the sad plight of Muslims today. "It is heartbreaking for us to see our glorious civilization slip from the exalted graces of dignity to the ravines of frailty," he said.

The Saudi ruler lashed out at Al-Qaeda terrorists for unleashing evil and corruption on earth and urged the summit leaders to fight terror jointly.

He urged Muslims not to despair "for from the darkness of night breaks the light of day and out of the depths of pain come salvation." He called upon Muslims to strengthen their faith in God and have optimism about their future.

"Let our faith in Almighty Allah be an unshakable boost to instill confidence in the peoples and leaders of our Ummah," he said.

He emphasized the need for strengthening Muslim unity, adding that "it will not be achieved by bloodletting as the miscreants in their misguided waywardness insist on claiming."

He said the Islamic Fiqh Academy, which is an affiliate of the OIC, has been overhauled to assume its historic role and responsibility in resisting extremist ideology in all forms and manifestations.

He said the real nature of the Muslim lies in his faith and then in his knowledge, principles and morality. "Prophet Muhammad (Peace Be Upon Him) has said "I have been sent to further establish the loftiest values of morality," Abdullah added.

Malaysian Prime Minister Abdullah Ahmad Badawi said the present economic conditions suffered by Muslim countries were merely a symptom of something more sinister.

"That is the lack of quality human capital due to poverty and lack of education. They must be eradicated," he said, "but in order to do so the Muslims must once again emulate the dynamism and intellectual splendor synonymous with Islam itself."

Badawi said almost one third of the total Muslim population lives in deplorable conditions.

"Nearly half a billion people still lack life's basic necessities. Compared to the rest of the world which has an average per capita income of $5,133, the average per capita income of those living in Muslim countries is roughly $1,000. The people in almost half of the OIC member countries live on less than $2 a day, an amount barely enough to sustain a subsistence living."

He said with regard to income distribution the Muslim countries fare even worse. "Illiteracy rates remain alarming. Almost 30 percent of the Muslim countries have adult literacy rates which are well below 50 percent. As a result we are rendered incapable of confronting the more serious problems plaguing us. This condition has resulted in poverty, a feature common to the Muslim world.

Badawi quoted a saying of the Prophet which says "when man is reduced to poverty not only does he lose his dignity but he approaches unbelief." He said: "We must work out the best strategy in terms of education if we are to eradicate poverty from our midst, otherwise we may unwittingly become detached from our historical roots which are adorned with a glorious dynamism that is Islam."

"We must remain mindful of the fact that development in Islam refers to the development of man. We must confront the problems head-on. We must not be in a state of denial. Our problem and dilemma are the powerful forces of secularism and conflict caused by sectarianism. These forces have threatened our sense of identity and our unity."

He said the OIC must change "in order to be relevant for the cause of uplifting the Muslim Ummah."

SPIRAL TOWER IN DUBAI

A group of Saudi investors announced that they are constructing the longest spiral tower in the world in Dubai. The cost of the tower is SR218 million and it is going to be 330 meters long with 80 storeys. Ahmad Al-Hati, the CEO of Saudi Kayan, the owner company, said that it will take three years to complete the tower.

NEW TOWER IN ALKHOBAR

Abdullah Foad Holding signed a contract with Suliman Al-Swaih Company to construct a 10-storey tower for the company's new offices in Alkhobar city. The cost of the new tower is SR50 million and is named after the company. The contract length is 20 months starting from the moment of the signature. The tower is expected to be a new landmark in the area

ARAMCO

Saudi Aramco has recently signed 13 different contracts with Saudi manufacturing companies to supply the company with pipelines. The contracts would secure Aramco's demand of pipelines by reserving the future production of the pipelines manufacturers during the entire periods of the contracts. Saudi Aramco aims at securing its demand of pipelines for its large projects to avoid shortage of supply due to the high global demand on pipelines.

DUBAI MARITIME AWARDS

Twenty candidates from nine countries across the Middle East, Europe, USA and the Subcontinent, have been short-listed for the second Dubai International Maritime Awards (DIMA), the honors recognizing top industry achievers in West and Central Asia which will be presented in a gala dinner in Dubai next week (12 December).

"Response to this year's awards has been overwhelming and the geographic spread of the short-listed candidates is extremely encouraging," said Chris Hayman, Managing Director, Seatrade, international maritime publisher and organizer of DIMA.

The awards, judged independently by a cross-global panel of industry leaders under the chairmanship of Efthimios Mitropoulos, Secretary General of the International Maritime Organization (IMO), cover nine categories which include four new honors this year.

'The new honors to enter the awards this year are outstanding contributions to dry bulk shipping, liner shipping, and energy transport and maritime services sectors, 'added Hayman.

Short-listed candidates in the 'Safety and Quality in Shipping' category are Vela International Marine, Lonestar Technical Services from the UAE and Saudi Aramco, Saudi Arabia.

Islamic Republic of Iran Shipping Lines, Iran and Applied Research International from India are short-listed for the 'Innovation in Shipping' category. Short-list for Port Operations are C. Steinweg Oman LLC and Karachi Port Trust, Pakistan.

Transas, Ireland is competing against First AFG, USA and Unimarine services, Greece for the Countering Marine & Atmospheric Pollution award. Three companies are in the running for the Education & Training award: Fleet Management & Training, India, Tidewater Middle East, UAE and Maritime Training Institute, Pakistan.

Short-listed candidates for the four new honors are Blue Ocean Shipping, Iran, Samsara Group, India, Simatech Shipping LLC, UAE, Islamic Republic of Iran Shipping Lines, Iran, Academy of Maritime Education & Training (AMET), India, Ports, Customs & Freezone, UAE and Saudi Aramco, Saudi Arabia.

The second annual awards scheme will also cover the highly anticipated Seatrade Personality of the Year for West and Central Asia, first won in 2004 by Mohammad Souri of National Iranian Tanker Company.

The awards presentation dinner, to be held at the Grand Hyatt, Dubai on December 12, will also coincide with Middle East Money & Ships 2005, a specialist two-day conference for the financial and maritime industries.

DIMA are sponsored by ABS, Charter Trade Global (LLC), Dubai Drydocks, DVB Bank, GAC, Lloyd's Register, Scan-Trans Middle East, Seatrade Academy and Vela International. The awards scheme is supported and endorsed by DP World and Dubai Maritime City.

IRAN SEEKS KUWAITI INVESTMENT

Iranian Charge d'Affaires to Kuwait Abolghasem Shashini invited Kuwaiti businessmen to invest in Iran.

Speaking to a group of Kuwaiti businessmen, he informed that an Iranian economic and trade delegation, headed by Iranian Deputy Economic Minister Majid Kazaii, will visit Kuwait next week.

Iran has set up an economic environment that is conducive to foreign investment and has approved regulations and facilities whereby foreign investors can invest in the country with peace of mind, the official said.

He further said that the Iranian delegation that is traveling to Kuwait will meet with Kuwait's economic and trade officials as well as Kuwaiti investors and entrepreneurs.

The Iranian delegation will be visiting Kuwait on the heels of a Kuwaiti economic and trade delegation that visited Tehran recently.

Shashini, referring to the growing trade between the two Persian Gulf nations, said that bilateral trade topped $234 million last year.

However, he said the figure is still inadequate given the ample potentials of the two nations.

He further informed that in the past six months several agreements have been signed by the two countries that will have the effect of greatly increasing their volume of trade as well as the number of tourists visiting the two states. "In addition to boosting cordial political ties, the two nations are striving to improve their trade and economic exchanges."

Kuwaiti tourists in 2004 ranked Iran fourth among their favorite destinations, Shashini said.

He said that Iranian expatriates in Kuwait have contributed to the economic development and progress of the country and Tehran is keen to enter into a technical cooperation with the Kuwaiti government.

It is note worthy here that former Iranian commerce minister Mohammad Shariatmadari held a meeting in February with Iranian and Kuwaiti entrepreneurs and traders and responded to their questions on possibilities for investment and trade in Iran.

Shariatmadari, during that meeting, expounded on Iranian measures that have been enacted to expand foreign investment and international trade with countries as well as policies intended to draw foreign investment into the country.

He brushed aside concerns expressed by Kuwaiti investors on "burdensome business taxes" imposed in Iran; saying taxes imposed on foreign capital were the same as those imposed on domestic investment.

According to him, in order to facilitate business transactions and build investor confidence several Iranian banks had asked the Kuwaiti government for authorization to open branches in the country.

"The Kuwait government at first refused, but apparently there has been a change of mind and it has now permitted reputable international banks to operate in the country," Shariatmadari said, adding that the Kuwaiti government has also authorized Iran's Tejarat Bank to open a branch in Kuwait.

IRAN-NIGERIA OIL DEAL

Iran and Nigeria will soon conclude a contract for oil exploration operations in Guinea waters of this west African country, technical director of Iran's Oil Exploration Operation Company (OEOC) Alireza Saeedi said on Tuesday.

The company won the bid on December 1 in collaboration with an international enterprise which would take care of investment part of the project estimated at $150m. The timetable for the project is set at four years and the contract would be signed in the form of 'participation in production', Saeedi stated.

The OEOC is supposed to handle the operational activities by drilling two wells at the depth of 2,000 meters each. "If successful, the development operation contract will also be given to us," the director added.

The $40m the right-to-sign expenses for this contract will be paid by the OEOC's foreign partner to Nigeria, he said in conclusion.

IRAN A MAJOR POLYCARBONATE PRODUCER

Iran will turn into fourth major polycarbonate producer in the world, managing director of Khuzestan Petrochemical Company Masud Jamshidi said..

Jamshidi added, with a three-eight percent increase in annual demand for polycarbonate worldwide, Iran hopes to raise production of the strategic product to meet the spiraling demand.

He said a polycarbonate production unit will start operation in Khuzestan by March 20, 2006 (marking the end of the current Iranian calendar year), to produce 25,000 tons/year of the product. Some 2,000 tons of the total volume will be for domestic consumption and the rest for exports, he added.

He referred to the high value-added, profit and logical price of the commodity as among the incentives motivating Iran to turn to production of it, saying each ton of polycarbonate is currently sold for $2,000 to $3,000.

OIL REGIME'S ROLE TO GAIN BOOST

In the midst of all the confusing and contradictory signals, from the pundits and not so pundits, it was indeed reassuring, refreshing, reinvigorating and professionally rewarding in many ways to hear, from non other than the International Energy Agency chief economist Dr. Fatih Birol, reiterating before a select audience that this hydrocarbon driven civilization is not approaching its ultimate end.

As the OECD energy watchdog, the IEA has a very important role to play and hence its assertion that this energy rich region will continue to play a vital role in quenching the global energy thirst in the years and decades to come, should also soothe some nerves at least.

Birol, is a well established and respected name in the global energy fraternity. Being the chief economist at the IEA, he is regarded as the principal author of the "World Energy Outlook - 2005" released by the IEA last month. Birol was in Riyadh, late November and during his visit he also presented the crucial chapter - "Middle East and North Africa Insights"- of the just published report before the select gathering of diplomats and energy professionals at the newly inaugurated headquarters of the International Energy Forum.

The presentation hovered around the IEA projection of state of industry in nine energy rich states of the Middle East & North Africa. And one major finding of the IEA reports was that despite what Mat Simmons & co, could continue to think, the region would continue to play a very critical role in meeting the global energy requirements in future too - which as per the IEA report could go up to 115 million bpd by 2030, if other constants remain same.

The Middle East & the North African region would still be the major energy provider to the world in 2030, argued Birol while presenting his energy insight of the region. From current approximately 29 million bpd, the supplies from the region would go up to 50.5 million bpd, as more than 60 percent of the proven oil reserves are in this region, he argued.

The MENA share in the global supplies would thus go up to 44 percent of the total global supplies by 2030. Currently the region accounts for only 35 percent share of the global markets, he projected.

However, in order to be able to meet the global needs, huge upstream and downstream investments are required in the energy sector, he argued. According to Birol, provided other constants remain same, an estimated $1.5 trillion - $56 billion per year - is required to be invested until 2030 in the sector in this region alone.

According to the IEA estimates, Saudi Arabia would also need to invest some $174 billion in the sector by 2030 and 80 percent of it would be have to be in the upstream sector, as the call on Saudi crude was projected to go up to 18 million barrels a day. Currently Saudi output is hovering around 9.5 million bpd. Birol however, was confident that Saudi Arabia has the potential, reserves, the technical capability and the will to invest so as to be able to meet this growing call on its crude.

Similarly in order to meet the requirements of lighter, preferred crude, an estimated $480 billion needed to go into the refining sector until then - both for new facilities and for revamping the existing ones, the IEA report projected.

In recent months, question marks have also been raised about the Saudi super giant field Ghawar with some arguing that it may not continue to produce at its current level as the field is already past its peak. Ghawar roughly produces five million barrels a day.

As far as the economics is concerned, as per the IEA projections, oil prices would stabilize and would be driven down over the next few years so that by 2010, the prices would be hovering around $46 a barrel, only going up to $74 per barrel by 2030 in nominal terms. Hence MENA revenues from its hydrocarbon resources would also go up from $313 billion in 2004 to $635 billion by 2030 - in 2004 terms.

 
 

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