Economic News

Mena region to see record level of IPO activity in 2014

Initial public offering (IPO) activity in 2014 is expected to touch a record level on the bullish sentiment witnessed in the last quarter of 2013 in the Middle East and North Africa (Mena), according to an industry specialist.

The UAE ranked top in terms of IPO issuance during the fourth quarter of 2013 in the region. Dubai Financial Market benchmark index recorded more than 100 per cent jump in 2013 compared to 2012 while capitalisation also increased by more than 40 per cent during the same period.

The largest IPO was from the UAE with Damac Real Estate Development listing on the London Stock Exchange and raising $348 million in a global depository receipt (GDR) offering. Two other IPOs from the UAE were also in the UK, with two in Oman and one each in Saudi Arabia, Morocco and Tunisia.

Source: Khaleej Times, 16/01

Companies in Mena region value innovation

Data for the ‘Innovation in the Mena’ poll was collected online from November 18 to December 30, last year, with 6,268 respondents from UAE, KSA, Kuwait, Qatar, Oman, Bahrain, Lebanon, Syria, Jordan, Algeria, Egypt, Morocco and Tunisia.

Seven out of 10 (69.4 percent) respondents said that their companies keep up to date with other organisations in their field and adopt best practices. The majority (82.9 percent) also said that their companies employ a long-term innovation strategy rather than a short-term one, which, according to 63.8 percent of respondents, has led to their companies’ innovation performance surpassing that of other firms in their industry. 61.8 percent also say that innovation has led to improved financial performance.

Source: The Peninsula, 17/01

Gulf

Four GCC countries to introduce common currency

Four Gulf Cooperation Council (GCC) countries will announce the introduction of a common currency by the end of December, a Bahraini daily reported on Sunday.The common currency to be announced by Bahrain, Kuwait, Qatar and Saudi Arabia will be pegged to the dollar, a source told Akhbar Al Khaleej.

The GCC countries have been discussing a currency union similar to the Eurozone for more than 15 years.

Bahrain tops index of economic freedom

Bahrain remains the Middle East and North Africa (Mena) region's most economically free country, according to the annual Index of Economic Freedom published by The Heritage Foundation and the Wall Street Journal.

Overall, the kingdom is ranked 13th out of 178 economies worldwide, between the US and the UK which rank 12th and 14th respectively and is the only Mena country to rank in the top 20. In the 20-year history of the index, Bahrain has consistently achieved a score greater than 70, well above the world average. The kingdom's 2014 economic freedom score is 75.1.

The report highlights that the kingdom's "transition to greater openness and diversification is based on foundations of economic freedom," and that Bahrain "continues to be a financial hub for dynamic economic activity, with high levels of trade and investment bolstered by a competitive and efficient regulatory environment".

According to the report, Bahrain has improved its economic freedom score in a number of categories at an above-average rate since index grading began 20 years ago, particularly in the areas of financial freedom, investment freedom and labour freedom.

Source: Gulf Daily News, 16/01

EU will have regular talks with Oman on economic issues

The European Union is looking to establish a regular dialogue with Oman in certain economic and political areas of interest to the two sides, said Baroness Catherine Ashton, High Representative of the European Union (EU) for Foreign, Policy and Security Affairs, and Vice-President of the European Commission.

Ashton was in Oman yesterday on a day-long visit.

Speaking to the Times of Oman, she said, "The visit to Oman was a good opportunity to discuss about setting up a regular dialogue. From now on, our officials will follow that through.

"Oman is an important partner for us, both individually and as a key member of the Gulf Cooperation Council (GCC). Oman also has long running ties with the European Union as well as member states." She added: "EU is keen on strengthening the partnership."

Referring to the focus of the upcoming EU-GCC ministerial meeting in Europe in mid-2014, Ashton said, "The ministerial meeting will talk a wide range of issues including economic cooperation and current events that affect economies.

Source: Times of Oman, 16/01

New Airport in Doha to open doors mid-2014

The new Hamad International Airport (HIA) in Doha is expected to open in a phased manner by mid-year 2014, a senior official has said.

The Passenger Terminal will have an internal area of 600,000 sq m on opening day. The terminal will initially have three concourses and 33 contact gates. It will increase to five concourses and 65 contact gates, including eight for the A380 in the final build-out. The terminal also includes 16 lounges for various categories of passengers, 28 art installations by local, regional and international artists, more than 100 F&B and retail outlets, a transit hotel, a swimming pool, a luxury spa and squash courts.

The airport will also have a four-storey catering facility, one of the largest in the world with a capacity to produce 90,000 meals per day.

HIA and the planned Airport City span 29 sq km. More than 1,000 architects, designers, engineering consultants, and project managers worked on the project, through more than 200 local, regional and international contractors and service contracts.

Source: Trade Arabia, 17/01

Need for unified air traffic control in the Gulf

There is a need for a unified air traffic management system to monitor and operate the very congested airspace in the Middle East region, Akbar al-Baker, CEO of Qatar Airways and member of the Steering Committee, New Doha International Airport Project, said yesterday.

He was speaking at a press conference to announce the “phased opening by mid-year 2014” of the new Hamad International Airport.

When he was asked whether the new airports opening up in the GCC region would add to the congestion of the airspace, al-Baker agreed but also said the new airports also indicated the growth of the world’s top three airlines which have their headquarters in the GCC.

“New airports will facilitate the growth of the three main airlines that are growing very rapidly in the region. Yes, it is correct that there will be congestion in the way the airspace is managed,” he said.

Al-Baker called for a unified system modelled after a European body called Eurocontrol. “There will be a time, in our opinion, jointly there will have to be a single air traffic control management system, very similar to the Eurocontrol to monitor and operate a very congested airspace,” he said.

Source: Gulf News, 16/01

QE the best performing Arab bourse in post-financial crisis era

Qatari bourse posted strongest recovery after the Lehman collapse and the consequent global financial crisis. At the close of 2013, Qatar Exchange (QE) posted strongest recovery since March 2009 among Arab stock markets.

During the year 2013, Qatari bourse’s main benchmark QE Index rose by 24.17 percent, while the QE Al Rayyan Islamic Index rose by 22 percent. Trading activities on the QE witnessed a rise in market capitalization, traded value and number of transactions executed compared to a slight decline in the number of shares traded.

Qatar Exchange has ranked fifth among the best performing Arab Stock markets during the year 2013, recording an increase of 24.17 percent, while the Dubai Financial Market was ranked first with an increase of 107.69 percent. The Abu Dhabi Securities came Second with an increase of 63.08 percent.

Source: The Peninsula, 16/01

Foreign Direct Investment jumps by 200% between 2007 and 2013 in the UAE

The UAE is expected to attract foreign direct investment (FDI) of $14.4 billion in 2014, 20 per cent higher than 2013, according to a top government official.

Last year, the country also recorded a 20 per cent year-on-year growth in FDIs that reached $12 billion, Abdulla Al Saleh, Undersecretary, UAE Ministry of Economy, Foreign Trade Sector, told reporters at a news conference in Dubai on Thursday.

“In 2013, the UAE was able to attract three times more FDIs than expected,” Al Saleh said, adding that increased government spending and a significant resurgence in tourism, transport and trade have contributed to this upswing.

He mentioned that FDI jumped by 200 per cent from $4 billion in 2007 to $12 billion in 2013. The country is the third most attractive country in West Asia for FDIs, he said quoting UNCTAD figures.

Source: Khaleej Times, 17/01

Levant

Iraq says pipeline to Jordan, Egypt open for investment

Iraq had denied reports that it would fund a USD-multi-billion project to construct an oil pipeline to Jordan and Egypt, saying the project would be financed by the executing companies on an investment basis, an Iraqi news agency reported on Sunday.

The 1,680-kilometre double pipeline will pump one million bpd of crude and nearly 258 million cubic feet of natural gas from Basra on the Gulf to Jordan’s Aqaba Port.

In September, the US Wall Street Journal said Iraq has shortlisted 12 international companies to build the USD18-billion oil export pipeline.It said Lukoil of Russia, Mitsui of Japan, Larsen &Toubro and Go Gas of India, Italy’s Saipem and China National Petroleum Corp were among the shortlisted firms.

Source: Iraq Business News, 08/01

High hopes for Amman Stock Exchange in 2014

2014 is excepted to be a promising year for the Amman Stock Exchange (ASE) as the growth seen last year is likely to gain momentum, according to the market chief.

Nader Azar, acting chief executive officer of the ASE, told The Jordan Times in a recent interview that the bourse is set for faster recovery to pre-global 2009 financial crisis levels after the price index closed 5.5 per cent higher in 2013.

“I’m very optimistic that the ASE performance will pick up this year, which will be more stable in terms of prices and trading volumes,” Azar said, stressing that the Kingdom’s stock market was attractive for non-Jordanian investors in 2013.

Trading at ASE reached around JD3 billion last year compared to JD2 billion the year before, Azar indicated.

Source: Jordan Times, 14/01

Solidere shares benefit from positive political prospects in Lebanon

Upbeat news about the potential formation of a new government pushed the Beirut Stock Exchange higher Tuesday on Solidere A and B shares gains of 7.87 percent and 6.18 percent, respectively. “The positive activity witnessed with regard to Solidere shares reflects the optimism of investors amid hopes of the formation of a new government soon,” said Yves Rahme, head of the equities unit at Byblos Bank.

This new progress had a beneficial impact on Solidere shares, “which are usually the most affected by any positive or negative political events,” Rahme said.

North Africa and Maghreb

Egypt focuses on small enterprises

Last week, the Social Fund for Development's (SFD) board of directors, headed by interim Prime Minister Hazem Al-Beblawi, approved the organisation's budget for 2014, estimated at LE3 billion.

According to a statement from the cabinet, this budget will be directed at financing the development of small and micro-sized enterprises. A portion will also be directed at funding labour-intensive projects.

Azmi Mustafa, the former head of the SFD's Technical Department, told Al-Ahram Weekly that the new budget was larger than last year's, which came in at LE2.2 billion.

Source: Al Ahram, 11/01

Europac Group launches cardboard plant project in Tanger

The Europac Group acquired land in the Moroccan city of Tangier for the construction of a new integrated corrugated cardboard plant. The new plant is to be operational in the first half of 2015.

The first phase of this project began in the first quarter of 2013, with the opening of a center dedicated to the assembly of heavy-duty enclosures for the automotive sector. At this early stage of the project converting lines were also installed for the processing of card board boxes.

In total, the estimated investment in the project is EUR 30 million to be invested in different stages, including a third and final phase that involves the installation of two new converting lines to a total of seven in the new plant. It is estimated that the project will enable the creation of a significant number of direct jobs.

Source: Nuqudy, 15/01

Libyan Airlines returns to Benghazi

The headquarters of state-owned airline Libyan Airlines is to return to Benghazi, the airlines’ board of directors decided yesterday.The widely-anticipated decision that the airline should return to where it was founded 50 years ago, was announced following a special meeting at Benghazi’s Tibesti Hotel during te company’s golden jubilee celebrations.

Source: Libya Herald, 16/01

Libya announces new PPP draft law

A workshop on Public Private Partnerships (PPP) took place today at the Corinthia hotel, Tripoli. The workshop, during which Libya’s new PPP draft law was revealed, was entitled “Transition to a PPP model” and was organised by the Ministry of Housing and Utilities in association with international legal firm, Clyde & Co.

Minister Sherief said that he hoped that the initiative and workshop would come up with innovative ideas and a form of a PPP law for the public and private sectors to work together in all sectors. This included both the local and international private sector, the Minister added, to form effective partnerships that would help in building the Libyan state.

Source: Libya Herald, 14/01

Nokia to build-up Libya’s mobile broadband infrastructure

Nokia Solutions and Networks (NSN) opened a new office in Tripoli on Wednesday, committing itself to improving mobile broadband infrastructure in the country. The development is an important move towards the modernisation of communications in Libya, to better enable the use of smart phone devices, already widely available, and improve internet access options. Speaking at the inauguration of the the new office, Head of Middle East and Africa for NSN, Igor Leprince, said the opening was just the first step in delivering world-class mobile broadband to Libya.

Source: Libya Herald, 17/01