Sunday, January 31, 2010

Gold will continue to glitter despite market turbulence, says Victor Gonçalves
Posted by BusinessIntelligence Middle East
Source: The Gold Report , Author: Karen Roche
Posted: Sun January 31, 2010 11:10 am

INTERNATIONAl. Equities and Economics Report writer Victor Gonçalves, in this exclusive interview with The Gold Report, says the yellow metal will generally see more strength than weakness this year, hovering around US$1,500.

He's enthusiastic about some undervalued juniors and the prospects for rare earths, saying "a lot of projects are looking very economic and attractive."

The Gold Report: Victor, when we last spoke in October you predicted gold would see more strength through the end of the year and we'd see another market rally before a correction.

Gold has indeed strengthened and we saw a market rally, but not a correction yet. Does it mean we are due for a correction and, if so, in what time frame and by how much?

Victor Goncalves: I think we are due for a correction, yes. By how much and when, it's a little difficult to tell. One thing I can say is the market is rolling over now. We're seeing a bit of a top in the sense that the TSX has seen 12,000 for the first time in a long time.

The TSX Ventures rallied very strongly. The Dow is kind of trending. We are in an anomalous situation, and could see one of the two things. We could see a sideways market and then a correction or a bit of a correction now, another rally, and then probably a bigger correction.

If you look economic fundamentals, they're not stellar. They haven't warranted the market doubling in price, basically. The TSX has gone from 7,000 to 12,000 in a year where the market hasn't strengthened a whole lot. On the Dow, for example, which has gone from 6,000 to 11,000, we've got a doubling in equity prices with a stagnated economy. Something's got to give.

TGR: Were some of the lows more fear-based and not based on economic fundamentals?

VG: I don't think the lows were more fear-based; I think the lows were a little more realistic, quite frankly. I don't think they were going to stay there forever. For example, the Dow went to somewhere in the mid-6,000 range. I think that was too low based on everything, but I don't think that at 11,000 the Dow is realistic.

I would wager a guess somewhere between 7,000 and 8,000 is probably where the Dow should have landed due to economic fundamentals. All this growth we've had is not employment-based. It was credit driven and debt driven.

The run we had in the equity markets, particularly in the U.S.—I don't like using the word because everyone else uses it—but it's a bit of a bubble. So 11,000 on the Dow is a little rich. The market doesn't think so and, based on that, I think the Dow could see a bit of strength or at least stagnation at this level for a little while.

TGR: You mentioned earlier that we're in somewhat of an anomaly because we have gold and equities both doing well. To what do you attribute that anomaly and how long will that last?

VG: Basically, what I attribute that anomaly to is the market really doesn't want to go down and people don't want the market to go down. It hurts; it doesn't feel very nice. So what has happened here is we've had an unusually high amount of money and liquidity injected into the system.

All the institutions that receive this liquidity have actually used it more in the equity markets. For example, in a market that goes down like this, we should have seen the interest rates rise a little and they've stayed down, so money stayed cheap. So we have capital injections, cheap money.

We've got every government around the world trying to avoid a major recession, so all this money is in the system. Well, when the crash happened, the good stocks and a lot of the equities got hammered, so we're seeing a lot of people going to the equity markets because they're getting good returns. When you can just buy the Dow and double your money, people are going to do that.

So we've seen a lot of liquidity, but the price of gold has gone up because the fundamentals of the market are not good and anyone who understands the flight to safety would be buying gold. Additionally, as we discussed last time, the Chinese buying of gold is also very important.

Up until the Chinese as a population started buying gold, we've had only 80% of the world's population participate in the gold market because 1.5 billion were not allowed to buy gold. So now we've got the Chinese buying as well.

Obviously, there are other groups buying too, and buying on the premise that the U.S. is not in a good situation and that gold is a good investment. So you've got a bit of both.

Now, to answer your question, how long will this last? It'll last as long as liquidity is in the market, quite frankly. Now I suspect liquidity in the markets could go on a pretty long time.

Those printing presses can print a lot of money, but that will at some point come to an end and that may be soon. I don't think we'll see equity prices continue on a strong rally much longer.

Again, there are a lot of variables that go into determining exactly how long that is, but I do expect a decline in the equity markets, if not a small decline now, then a pretty major decline in several months.

TGR: Gold is now trading pretty firmly above US$1,000. A lot of people are starting to say that $1,000 is a base now. Some say gold is going to take off to several thousand dollars and others think it's going to trade somewhere plus or minus US$200 around US$1,200 an ounce. What's your feeling on the gold price?

VG: Plus or minus US$200 from US$1,200 to US$1,300 is probably a fair number over this year. Interest rates and monetary injections are already priced into the gold price and those will play out as well, but unless something changes I don't see having anything much more than US$1,500.

Now we also have to understand that we're going into a seasonally weak period for gold in February or March. So we should see the price of gold actually drop off a good 15% to 20% between now and April before the base US$1,000 comes back again.

Any appreciation in price probably won't happen until about June when we get back into the seasonally stronger period for gold. So we do have a headwind right now on the price of gold. I'm not keen on it going up from here during the early half of the year, but the latter half of the year we could see a similar rally to what we saw late last year.

TGR: Gold equities have had, in many cases, a huge run up, even better than the general market performance. If gold's going to be trading in a range of plus or minus US$200, what should we expect the gold equities to do?

VG: When we saw gold start to run up, it took some time for the equities to start moving up.

Now because of the liquidity in the market and the fact that gold is over US$1,000, a lot of projects are looking very economic and attractive. So a lot of people on the equity side are interested in gold because of the viability of US$1,000 gold.

TGR: Are there other metals? A lot of people look at gold and they say if gold's going to really go up based on the fear factor, silver will go up as well. Are you looking at other metals along with gold?

VG: Silver certainly is going to track gold to some degree. I see silver as a poor man's gold. It has more industrial uses than precious metals per se. So for silver to do well, it's going to have to get that monetary value, that investment value.

For that to happen, the price of gold is going to have to go up appreciably because it's still reasonably affordable to buy an ounce of gold for US$1,000. It's obviously a lot more than it was, but it's still something in that price range where you can buy it and make some money on it.

Once gold really starts trending up, let's say US$1,500-plus, the price of silver is going to have to catch up and actually continue going higher because silver is, at the end of the day, a precious metal and will become the precious metal of choice probably.

We've seen a little bit of that in India. When gold started breaking US$700-US$750 in '06 or '07, the price of silver ran up quite heavily because silver was trading between 70 and 65 ounces per one ounce of gold and it traded as much as 50:1.

So we can see that happen, but only when the price of gold starts moving away from people's ability to purchase it or wanting to purchase it.

TGR: You mentioned earlier that some of the equities still are undervalued and they need to catch up, even ones that have had some good appreciation in 2009. Can you share with us some of those companies that represent some good investment opportunities?

VG: Certainly. Kent Exploration Inc. is one I've recommended. Investors who bought it when I first talked about it at 4 cents are very happy. And at 22 cents now, I'm still not recommending to sell it because there's quite a bit of room for appreciation on Kent.

They have these assets in New Zealand and Australia that have gold on them already. They've done some work on the project and come back with some of the results, such as 80 grams a ton.

So it's certainly a very prolific area and Kent's right in the heart of it. I think they're going to see a lot of appreciation based on those numbers.

Kent's still only worth in the neighborhood of $8 million at the most, so it's still a very undervalued company. Based on these results, I was actually very impressed and think that it wouldn't be unrealistic for the company to double again from here.

NioGold Mining Corporation is another we've talked about and they've, again, done quite well. A new and updated 43-101 was due out at the very end of last year, but with Christmas and other holidays my thinking is the engineers are taking little more time than anticipated. But we should see it probably by the end of this month or the beginning of next. The company has between US$3.5 and US$4 million in the bank right now, so they're well funded.

The 43-101 should be a game changer for NioGold as it should give them a new base valuation of 60 to 65 cent a share just based on the assets. So looking at it from 30 cents here, again, is very nice and that's imminent. I've certainly been keeping close tabs on NioGold.

TGR: If everyone's expecting the 43-101 and the projects are looking good, won't they have priced in some of that already?

VG: I don't think the market's priced it in yet because they're not quite sure where it's going to come at ounces wise. It could come in a lot higher; it could come in a little lower, so that's really the uncertainty right now.

But based on their history, I know they're going to deliver, so I'm going to come in and say that they should be able to deliver at least 800,000 oz. But even if it comes in at 700,000 ounces, it would still be a 50 to 55 cent stock from 30 cents, which is quite nice.

One other on my radar is Mexoro Minerals. They've been progressing quite nicely over the past little while here. They are changing their name from Mexoro Minerals to Pan American Goldfields.

They're on the verge of listing on the TSX Venture, which should be accomplished in the next month or so and I think that's one of the key things they need to do. The OTC is not quite as a recognized exchange as the TSX, especially for a resource company.

So for a company to go on and list on an exchange where people can see it and buy it, it's going to make a lot of difference. So right now trading at 40 to 45 cents; just moving on to the TSX Venture alone should put a lot more visibility on the company.

They're also updating their 43-101 on their Cieneguita Project, which could turn out as much as 1.6 to 1.8 million ounces of gold from where it is now and they're producing already.

They're upping their production. Their gold production target is upward to 100,000 ounces of gold per year and that would involve upgrading their mills and so on. But that is their goal.

At 45 cents a share, that's a valuation of US$22 million on a company that's already producing 30,000 ounces of gold. That's very, very undervalued and I think the reason is that people don't know about it yet.

Those are the companies I like. Nobody knew about Kent, for example, eight months ago and, quite frankly, very few people still know about it.

These are the companies I like because the less people know about them, the cheaper they are to buy. Now people do know about them and they have made my readers and me a bunch of money.

Richfield Ventures Corp. is another, and has been the poster boy I've liked over the past year because from about June till now they've gone from a low of 12 cents to somewhere around US$1.20. But they briefly hit $1.95 a couple of weeks ago on some amazing results. I say amazing and I'm not using that word lightly. They drilled 329 meters of 1.25 grams of gold. That is a long, long intersection. That's a drill intersection three-quarters the length of the CN Tower.

When it comes to drilling time next year, I think there will be a lot of interest in this company. So from this US$1.20 range, it probably won't go anywhere significant over the next couple of months or so, but come about March-April-May when they can get back on the ground, even before they start drilling, I think we could see a significant lift in share price. They could easily be sitting on 3 to 4 million ounces of gold. This company has only 30ish million shares out trading at $1.20, that's very cheap. It's a very, very compelling story.

Paramount Gold and Silver Corp. is another one that I've got an eye on. The company has all the right tools and momentum to get to the next level of valuation, which would be comfortably higher than where it is now, with over 2.6 million ounces of gold equivalent and more than US$25 million in the bank.

A little needs to be said about management. Christopher Crupi, the CEO, is a dealmaker and certainly understands finances and business.

He was a former VP at Price Waterhouse Cooper and executed the sale of the Ottawa Senators among many other accomplishments. Bill Threlkeld, an advisor and qualified person under the National Instrument 43-10, is a seasoned gold finder with over 80 million ounces of gold discoveries in his career.

There aren't too many guys who can claim that kind of track record. Larry Segerstorm is the chief operating officer and the guy on the ground. He has been the exploration geologist for Newmont Mining Corp., Noranda, and Phelps Dodge among others. All the above people have been pivotal in creating this company and the asset base it is trying to develop.

TGR: Let's move on to rare earths, which have been getting a lot of buzz at the various mining conferences. What's your viewpoint on them and the investment opportunities they represent?

VG: Rare earth elements and rare earth metals, in general, are going to be a huge phenomenon. It's like in '07 when we had a uranium boom and uranium went from $8 to $136.

What it comes down to is these rare earths are needed for so many things. For example, hybrid cars are really the driver for rare earths' increase in price. But not just hybrid cars. You've got tantalum and niobium being used in a lot of other things and these rare earths are going to be in huge demand.

I don't think we've gotten ahead of ourselves with the demand or with the price of these rare earths. We don't have enough to supply the markets fast enough. That's partially what's causing the price to move up. There's also supply constraint out of China.

China controls 95% of the rare earths and says, okay, we'll just keep them for ourselves, thanks. You've got to fight for the rest of the 5% of them out there. So that's obviously causing major upswing in the price of rare earths. That has been the main driver.

But that coupled with a shift in how we do things — we're going to see a ton more hybrid vehicles go on the road over the next couple of years and each one of them is going to require 50 pounds of rare earths. That's going to add up.

TGR: Jack Lifton, who speaks at conferences about the rare earths, asserts that it's really a rush to production. When the next two or three companies actually get to production, the amount they produce will probably satisfy demand for decades to come.

VG: Yes, it is a race to production. Like with uranium, for example, there's plenty of uranium out there for the market. It's just whoever does it first will obviously satisfy a lot of the market and I think that's quite the possibility for rare earths.

The best part for an investor is that it's not going to happen today or tomorrow or next year. We've got a little bit of time. We've got some idea as to which companies have been in the space for a long time and have had more lead time to develop a project and get to the stage where they're working the economics of it.

Those are the companies I'm really interested in. Obviously, there's a lot of brand-new companies coming out of the gate who will represent an excellent investment opportunity because of the sizzle in the market, but I would have to hear something incredibly compelling from a very small junior to sway myself from some of the larger companies.

TGR: So who are you following, then, in the rare earths?

VG: Avalon Rare Metals is kind of a darling because I bought it so cheap. I've been following that from around the 40 cent range. It had a very impressive run to over US$4.

The most important thing is not the tenfold run in price. It's also the increase in market valuation because a US$4 market cap on a company with 80 million shares outstanding is a company that's worth a lot of money and is representative of what they've got.

They've got one of the largest deposits, they're working on feasibility, they're working on all the things it's going to take to put it in production. Based on its size, I don't think the fact that it's in the north is going to be a major hurdle. If anything, due to the relationship with the native communities up there, I think that's actually going to be a benefit.

So Avalon I personally believe is going to be probably the first or second company to attain that status, and they're very well funded, working towards their end goal.

They're considering actually using wind power to power their project because they are located in one of the windiest places up in the Northwest Territories. So I think that really attests to a legitimately green company. This company is the type that's just going to keep moving up and up and up because they're going to keep hitting the milestones without anything hindering it.

TGR: So they're one of the first one or two to get to production. Are there other ones that you are following that are in a similar situation?

VG: I think Rare Element Resources Ltd. is certainly in a similar situation. I have a personal bias towards Avalon just because I have so much more of Avalon stock, but that's not to say by any means that Rare Element Resources is not in a situation where they can really progress.

They've had a similar run in their stock from give or take 40 cents to US$4 as well. They have a tighter share structure, but they also have a bit of a small project. However, it's not in the remote situation; i.e., it's not in the Northwest Territories, so that's kind of nice.

But I think both these companies are going to be real winners in this situation. It'll be like having a Goldcorp and a Barrick. It's not necessarily one or the other. I think it'll be really both.

TGR: On BNN you mentioned a company named Threegold Resources Inc. that seems to be in a similar space.

VG: Threegold is in the rare earth space. And, again, not a lot of the companies that are really in a low, low market cap (i.e., 15 cents and lower with not very many shares out) compel me in the rare earth space, but Threegold certainly did for multiple reasons. I've actually followed this company for quite a while, since inception actually, just haphazardly because somebody presented it to me.

When I saw them come out with these rare earth numbers, I was quite intrigued and I sat down with the president probably a couple of months ago. He told me in University his Masters was on rare earths.

A lot of these rare earths companies, especially the ones just sprouting up now, have nice projects, have good consultants, but the people who actually work for the company don't always have the highest expertise in the area.

Well, this is a company who has a guy in charge that spent most of his academic career working on and researching the rare earth space and that, to me, makes a big difference.

I think it's around 17 cents today. Right now we're still waiting on news on their gold project which could end up being a new discovery. If it comes back positive, I think it'll be a game changer for the company. This could have major potential. That's my opinion.

TGR: And we appreciate your time, once again, Victor. This has been very interesting.

Note. A proud and avowed Keynesian, Victor Gonçalves developed a strong background in economics at the University of Winnipeg, where he served as a Professor's Assistant as well as earning his degree. His Equities and Economics Report has been accurately picking winners and calling market direction. In 2007, for instance, he correctly predicted the Dow Jones topping 14,000 points and pegged uranium reaching US$136 per pound and many more.

In addition to EER, Victor also produces the Green Dollar Report , as well as writes for a number of print and electronic publications including CIM Magazine (Canadian Institute of Mining), Western Standard, Barron's and Kitco. He also has been featured on BNN, Mining Industry TV and at numerous industry events and conferences.

Streetwise - The Gold Report is Copyright © 2009 by Streetwise Inc. All rights are reserved.

For more information about The Gold Report, please visit www.theaureport.com

News Link: http://www.bi-me.com/main.php?id=43878&t=1&c=33&cg=4&mset=1011
Deep crack across land in Ibri
Posted by Zawya.com
30 January 2010


IBRI: These days Ibri is the most sought-after destination for the scientists and curious residents from in and around the town.

The reason: Three-hundred and-fifty-metre of parched land in the desert village of Al Khuaibiya, approximately 290km from Muscat, has developed one-metre deep crack on 350 metres of earth surface.

Though the crack was developed in April last year, scientists are working round-the-clock since then, to ascertain the reason for this unusual phenomenon.

Ever since the process, there have been speculations that the crack could have been due to earthquake.

But scientists allayed fears that it was the not the result of an earthquake, instead, the cracks must have developed due to dryness of the land.

Dr Issa Al Hussein, director of Meteorology at the University of Sultan Qaboos said that there have been ample queries from the residents and scientists inquiring about the rare phenomenon.

"We have a monitoring station for earthquakes in different regions of the Sultanate, including Ibri, but the station did not record any earthquake," he said, adding, the crack, which happened in Khuaibiya in Ibri was not the result of any earthquake, but the long-term drought that occurred in that region and also because of the nature of the soil in that area.

"The type of the soil in Khuaibiya is soft clay soil so it was natural that these soils dry out for the severity of drought," said the scientist. He pointed out that earthquakes should cause an offset in the ground and cause large and clear signs, which do not exist in the Khuaibiya.

However, the quake centre does not have any concrete study on Khuaibiya owing to lack of monitoring station there, but Dr Issa Al Hussein claimed that the centre has begun a careful study of earthquakes risk in Oman in October 2009, which will last for two years.

Meanwhile, Talib Al Abri, an employee in the government sector, said, "People in Ibri, whoever, are not aware of the earthquake, and its effects are visible." He said as stories make rounds in the village, Khuaibiya was a human habitation for the tribes for hundreds of years, but has now turned into desert, thereafter.

Salim Al Abri, another employee said, "The crack has ceased to go beyond a certain point. The total length of the crack is up to 300 metres and the depth is nearly a-metre-and a- half." He added that many of the visitors come to see the cracks, while his friends have been showing concern about such a rare phenomenon.

By FAHAD AL GHADANI

© Times of Oman 2010

News Link: http://www.zawya.com/Story.cfm/sidZAWYA20100130045501/Deep%20crack%20across%20land%20in%20Ibri%20/
AU, Arab League hold ministerial meeting on agriculture, food security Feb 14
Posted by Zawya.com
30 January 2010

CAIRO -- The Egyptian resort of Sharm El-Sheikh hosts on February 14 Arab and African Agriculture Ministers to discuss food security and to prepare for the 2nd Afro-Arab summit, to be held in Libya in October.

A statement by the Secretariat of the Arab League on Saturday said the ministers would discuss all means to providing food security and promoting development in the Arab and African regions.

Arab League Secretary General Amr Moussa and African Union Commission Chairperson Jean Ping announced during their meeting two weeks ago, the readiness of procedures necessary to hold the Ministerial meeting.

The director of the Arab-African cooperation department in the Arab League, Ambassador Samir Hosni told the reporters on Saturday that the convening of this meeting reflected the interest of both the Arab League and the AU to lay the foundations for a serious cooperation in agricultural development and food security.

Arab and African experts are to meet in Sharm El-Sheikh shortly before the ministerial meeting to put the finishing touches on joint draft program for agricultural development and food security as well as the mechanism for follow-up and implementation.

© KUNA (Kuwait News Agency) 2010

News Link: http://www.zawya.com/Story.cfm/sidZAWYA20100131081338/AU%2C%20Arab%20League%20hold%20ministerial%20meeting%20on%20agriculture%2C%20food%20security%20Feb%2014%20/

Saturday, January 30, 2010

Saudi stocks expected to ‘recoup losses’
Khalil Hanware & Abdul Jalil Mustafa | Arab News

Saturday 30 January 2010 (14 Safar 1431)

JEDDAH/AMMAN: Saudi shares lost fresh ground last week with additional pressure coming from China’s restrictions on bank loans, which renewed concerns over receding demand for crude oil by the world’s second largest economy.

The Tadawul All-Share Index (TASI) shed 2.03 percent last week, crashing the 6,300-point psychological barrier and closing at 6,252.71 points.

TASI is currently 2.1 percent higher than the year’s start.

“The Saudi market was negatively affected by developments of the US economic policies,” the Riyadh-based Bakheet Investment Group (BIG) said in its weekly report.

The group expected the Saudi market to rebound this week and “to recoup its losses.”

Kingdom Holding Co. was the top gainer last week as its shares surged 7.80 percent to SR7.60. The other major gainers were Abdullah Al-Othaim Markets Co., 6.16 percent, Al-Baha Investment & Development co., 4.41 percent, Yamama Saudi Cement Co. Ltd., 3.70 percent, and United International Transportation Co., 3.59 percent.

Al-Sagr Cooperative Insurance Co. shares plunged 1.83 percent to SR53.50 last week. The other major losers last week were Saudi Cable Co., down 8.81 percent, Middle East Specialized Cables Co., 7.16 percent, Bupa Arabia for Cooperative Insurance, 6.08 percent, and Saudi Industrial Investment Group, 6.08 percent.

The stock market turnover also declined to SR15.09 billion last week compared to SR19.15 billion in the previous week.

The Capital Market Authority (CMA) announced last week that the listing and trading of Herfy Food Services Co. would take place on Tuesday within the Agriculture & Food Industries sector, with an unrestricted price limit for the first day of trading only.

Saudi corporate earning announcements continued last week, with 110 of the 132 listed firms on Tadawul last year having disclosed their results. The combined net profit of the firms increased by 25.6 percent to SR57.73 billion in 2009, from SR45.97 billion in 2008. This constituted an approximate 47 percent decline from SR86.54 billion attained in 2007, the National Commercial Bank (NCB) said in its weekly market review.

Excluding the profitability of the 11 listed Saudi banks, the combined net profits rose by 63.9 percent to SR35.5 billion in 2009, the NCB report said.

The net profits of the listed banks declined 8.6 percent to SR22.22 billion in 2009 largely on credit related provisions. However, with NCB’s strong positive outcome, the Kingdom’s banking sector’s earnings plunge moderated to 0.3 percent down to SR26.3 billion in 2009.

The 60.3 percent drag in petrochemical earnings was largely due to prices in the international markets that affected SABIC (Saudi Basic Industries Corp.) profits. The companies largely influenced by domestic economic activities were the biggest gainers, with agriculture sector showing 62 percent earning growth in 2009, the NCB report said.

Arab stock markets extended losses last week under the impact of plunges at global markets and falling oil prices, financial analysts said Friday.

However, they expected the 2009 results of listed firms to remain a moving factor for regional markets for weeks to come.

“The psychological correlation between Middle East bourses and global markets is surfacing again as one of the factors to reckon with,” an Amman-based portfolio manager said.

The Wall Street and other global bourses suffered last week as a result of US President Barack Obama’s announcement of measures to limit the size of banks and financial firms and to impose restrictions on risky transactions, he said.

“His (Obama’s) remarks in the State of the Union address apparently cast doubt on the world recovery and put downward pressure on crude prices with fallout on Gulf stock markets,” he added.

Jordanian shares were volatile last week due to what analysts described as lack of incentives and shrinking liquidity.

The all-share index of the Amman Stock Exchange lost 0.87 percent last week, closing at 2,531 points, according to the ASE weekly report.

Kuwait’s KSE all-share price index shed 0.4 percent last week, closing at 7,035 points with pressure coming from the banking sector, analysts said.

The United Arab Emirates shares continued to come under pressure from foreign selling and the spill-overs of the Dubai World debt issue, analysts said. The benchmark of the Dubai exchange plummeted 3.2 percent to 1,599 points. Abu Dhabi’s index closed lower at 2,628 points from 2,637 points previous week.

Egypt’s AGX30 index, measuring the performance of the market’s 30 most active stocks, lost 2.5 percent to close at 6,696 points.

The GulfBase GCC index declined 2.24 percent to 3,663.73 percent. The value of GCC traded shares also fell 12.18 percent to $6.30 billion and volume dropped 4.60 percent to 5.16 billion of shares.

News Link: http://arabnews.com/?page=6&section=0&article=132072&d=30&m=1&y=2010

Wednesday, January 27, 2010

Industry Takes Part in Board of Arab Union of Chamber of Commerce Industry And Agriculture
Posted by RedTram News
27.01.2010 18:29

Tunis — A delegation from the Tunisian Union of Industry, Trade and Handicrafts (UTICA), took part in the 108th edition of the board of the General Union of Chambers of Commerce Industry and Agriculture of Arab countries which gathered on Monday, in Beirut, Lebanon.

The meeting focused on the implementation of the measures taken by the Arab economic summit held in Kuwait on January 2009. It also discussed the Union's activities during 2009 and its action program for 2010.

Participants also took cognizance of the preparations of the Arab businessmen and investors conference due to be held in March, in Syria.

During the meeting, Mr. Adnan Al Kassar, was elected as chairman of the board for a two year term, from March 17, 2010 and Mr. Abdelfatteh El Masri, the president of the Egyptian Union of Chamber of Commerce, as senior vice- President and Sheikh Saleh Kamel, president of Saudi Chambers, as second vice-president.

Mr. Hedi Djilani, the President of UTICA was elected as a chairman of the Executive Committees of the union. On their part, Mr. Ali El Thenyani Ghanem, from the Kuwaiti Chamber of Commerce and Industry , Mr. Gassen Klaa from the Syrian Chamber of Commerce and El Ain El Kabariti from the Jordanian Chamber of Commerce, were elected as deputy chairmen.

News Link: http://redtram.com/go/237336043/
Animal lovers call on Australia to build farm for feral camels
Posted by Arab News
Muhammad Al-Sulami | Arab News
Thursday 28 January 2010 (12 Safar 1431)


JEDDAH: With the campaign to prevent the Australian government from killing the country’s feral camels, the Saudi camel breeders and lovers have suggested that Australia build a big farm to care for the camels.

The farm would be financed by Gulf Arab money and skilled camel handlers could also be sent to care for the legendary ships of the desert.

Talking to Arab News, a number of camel breeders agreed that it might be very expensive to transport the camels from Australia to the Arab Gulf and said the Australian camels might not be able to adapt to the climatic conditions in this part of the world.

“For these reasons, we suggest that the camels be kept in their original home and that Australia build a farm with Gulf finances in which trained camel keepers would look after them,” they said.

Rabee Al-Rimaish, the owner of a number of camels, warned that even if the Australian camels were brought here, they would always be homesick for their natural habitat.

“Camels are emotionally attached to their birthplaces so they always want to go there if they are taken away,” Al-Rimaish said. “Camels are by nature very sensitive animals and they have a strong attachment to their surrounding,” he added.

He recalled an incident that occurred with his own camels about three years ago.

“I was moving my herd to a place near Qunfudah on a three-day journey when one of my female camels got lost,” said Al-Rimaish.

“The herder did not notice that the camel had separated itself from the herd. After two days, I found her in the place which we had left. She was born there and she had returned to her birthplace,” he said.

He told the story to show the problems of bringing Australian camels to the Kingdom.

“Instead, I strongly support the establishment of a special camel farm in Australia. This is better than killing them or transporting them outside their country,” he said.

Al-Rimaish also said the camels which are used to grazing in sandy areas would find it difficult to feed themselves in mountainous terrains.

According to him, Sudanese and Ethiopian camel herders have immense experience in dealing with camels. “They can be sent to Australia to make the camels feel comfortable when they are in contact with humans,” he added.

Saad Al-Johani, another camel owner, categorically denied that camels were wild animals. “They are tame animals and are very nice and easy to deal with,” he said.

He said the camels were domestic animals and not at all wild. “People who are not in direct contact with camels may consider them to be wild but in fact they are not,” he said.

Al-Johani said the camels had special eyes which see man larger than his real size.

“They see any man who gets in touch with them to be of a very big size so they easily yield to his power,” he added.

He described camels to be as useful as horses and sheep. “Their milk is very nutritious and can by itself be a complete meal for man,” he said.

Bunayan Al-Aali said camel milk and urine were used for curing a number of diseases, including hepatocirrhosis.

“I had a cousin who suffered from liver malfunction. We treated him with camel milk and urine. After a month and a half, he had fully recovered. He is now quite normal,” Al-Aali recalled.

He said a research into medical uses for camel urine had been carried out in both Sudan and Saudi Arabia, adding that the best urine came from female camels that did not give birth.

Dr. Fatin Khorsheed, head of the tissue and cell unit at King Fahd Medical Research Center, said in a recent press statement that camel milk and urine were effective medications for cancer, specially in early stages.

She reportedly said cancer patients who were undergoing chemotherapy could also drink camel milk and urine as part of treatment.

News Link: http://www.arabnews.com/?page=1&section=0&article=131964&d=28&m=1&y=2010&pix=kingdom.jpg&category=Kingdom
2010 ranking of fastest-growing Saudi businesses indicates bright entrepreneurial future
Posted by BusinessIntelligence Middle East
Source: BI-ME , Author: BI-ME staff
Posted: Wed January 27, 2010 11:31 am


SAUDI ARABIA. The second annual list of Saudi Arabia's fastest growing emerging businesses, released last night at an Awards Gala at SAGIA's 4th Annual Global Competitiveness Forum in Riyadh, reveals a diverse array of robust companies, the majority founded by entrepreneurs, male and female, who are young and aggressive. They also show that entrepreneurship in the Kingdom is surging.

They are growing fast and expect to accelerate the pace, expanding nationally and throughout the Middle East.

Saudi Fast Growth 100 winners all have a track record of extraordinary revenue growth, while accounting for the creation of thousands of new jobs.

The Saudi Fast Growth 100 is national program to promote entrepreneurship and innovation in Saudi Arabia that ranks the fastest-growing emerging companies in the Kingdom.

The list was created by the Saudi Arabian General Investment Authority's (SAGIA) National Competitiveness Center with joint founding partners Al-Watan newspaper and AllWorld Network. Joining the initiative, as Strategic Partners are the National Commercial Bank, Sukoon International, Siraj Capital and Phenomenal PR.

"Compiling the Saudi Fast Growth 100 list led us to several encouraging conclusions," said His Excellency Governor Amr Al-Dabbah, SAGIA's Governor. "The dynamism of the applicants demonstrated clearly that Saudi Arabia is creating a business climate that supports and rewards innovation and entrepreneurial initiative.

This vital group of emerging growth companies provides the oxygen of the economy. The winners of the Saudi Fast Growth 100 list will be the guides to our future. These trail-blazers will be the most potent signal that Saudi Arabia is a dynamic economy full of creativity and opportunity."

AllWorld Network and Harvard Business School Professor Porter (AllWorld's Chairman) have created similar rankings of fast growth emerging companies in the US and the UK. "The Saudi Fast Growth 100 companies, led by dynamic men and women, represent the leading edge of a new approach to Saudi Arabia's competitiveness," says Harvard Professor Michael Porter. "These companies have already created more than 19,000 jobs and their ambition is to keep growing."

A survey of Saudi Fast Growth 100 CEOs outlined a picture of business dynamism and CEO optimism. The analysis provides many fascinating insights into the Kingdom's entrepreneurial economy.

During the five-year period measured (2004 - 2008), 45 Saudi Fast Growth 100 companies responding to the survey created more created 19,000 jobs since they were founded, of which 11,000 were created in the last five years.

The companies grew at a 41-percent average compound annual growth rate, with revenues ranging from SAR 4 million to SAR 1 billion.

The average age of company CEOs at start-up was 33 years and many of them have formed three or more companies. The highest concentration of companies is in High Tech and Telecommunications followed by Health & Education, Public Relations, Media & Publishing, and Construction & Engineering.

Moreover, while evidence suggests a culture of what analysts describe as "opportunity seeking," the process is based on solid business fundamentals. Close to 90% of the businesses formed by the Saudi Fast Growth 100 CEOs are still in operation.

A majority of survey respondents indicated that growth plans over the next few years included acquisitions, initial public offerings, and expansion throughout the Middle East and beyond.

"This is one of the hottest entrepreneurial environments in the world with high rates of successful start ups. A generation of sophisticated entrepreneurs is emerging to fill the market gaps created by the Kingdom's large companies and government," stated Anne S. Habiby, one of the co-founders of AllWorld.

"The majority of Saudi Fast Growth 100 entrepreneurs have started more than one company, and the majority plan to establish another company in the next two years.

The conditions are right and the evidence confirms that entrepreneurship is surging in the Kingdom."

The findings establish the Saudi Fast Growth 100 as a new benchmark for the country, and one that meets international benchmarks of US and European entrepreneurial competitiveness.

While the survey results are generally positive, they also reveal obstacles impeding business development and growth. Respondents cited difficulty accessing growth capital and excessive government regulations as serious impediments.

Also cited was the need for skilled workers and the absence of a program for training needed employees.

"The problems cited are clearly serious, but the good news is they can be corrected," said Deirdre Coyle, co-founder with Habiby of AllWorld.

"The paucity of start-up capital, surveys indicate, is due in part to the lack of information about Saudi businesses and the country's business climate. With regard to human capital, there is general recognition of the need and the benefits of building a deep, skilled labor pool. Plans are in development."

Saudi Fast Growth 100 is playing a critical market-making role bringing to light examples of entrepreneurial success. As these emerging companies and emerging industries become known, new entrepreneurs will be inspired to build companies and capital markets will form to support them.

To see a complete list of the 2010 Saudi Fast Growth 100 companies, please go to www.saudifastgrowth100.com.


News Link: http://www.bi-me.com/main.php?id=43791&t=1&c=34&cg=4&mset=1011
Britain's Out of Recession: So Why No Cheers?
Posted by TIME
By Bruce Crumley
Tuesday, Jan. 26, 2010


The good news Tuesday, Jan. 26, was that after a year and a half of consistent economic decline, Britain announced that it had finally emerged from the recession. The downside? Its 0.1% fourth-quarter growth was not only about as small as could be but also well below what most experts had predicted. Worse still, some economists warn that the minuscule growth may be as good as the U.K. will muster for some time — and that its European neighbors aren't much better positioned to lead the region to a swift economic recovery.

Taking solace where they could, British officials hailed the official end of a recession that began in the second quarter of 2008. Though tiny, the country's fourth-quarter growth ended the nation's most severe economic slide in more than half a century — one responsible for a 6.1% decline in growth. The return to positive growth, however slight, was enough for Alistair Darling, the Chancellor of the Exchequer, to declare, "We are on a path to recovery," even if he qualified it by adding that he'll "always remain cautious."

Many economists admire Darling's optimism, though few could hide their disappointment at the 0.1% growth figure. Most had expected an 0.4% gain or more, thinking the economy would be fueled by the annual blast of Christmastime consumer spending as well as shoppers seeking to make purchases before an increase in the value-added tax went into effect in January. Though retail was one of the leading drivers of fourth-quarter growth, the boost in spending was offset by confounding slumps elsewhere in the economy.

Despite the billions the government spent on consumer-spending incentives to stimulate industrial output — like implementing cash-for-clunkers subsidies for new car buyers — the schemes didn't lead to massive growth in manufacturing. Industrial production and service-sector activities fared no better than the overall 0.1% growth figure for the fourth quarter, economists noted. "When the results were announced this morning during the meeting we were holding for the occasion, the hundreds of gathered guests all howled in derision and embarrassment at the figures they heard," says David Buik, a market analyst at the London brokerage firm BGC Partners. "It wasn't antipatriotic but rather the expression of enormous frustration at seeing so much money and effort made to stimulate economic and industrial activity for such meager returns."

Just as bad, most observers also aren't buying the hopeful government predictions that, however small the fourth-quarter growth was, renewed positive output marks the beginning of a gradual return to normal economic activity. That skepticism applies to the rest of Europe and other parts of the world as well. Analysts say that even though countries like France, Germany and the U.S. emerged from the recession months ago, their economic performances since then have remained very weak and vulnerable to setbacks. The reason? These countries returned to growth the same way Britain did: through massive infusions of state money to spur business activity.

In France, where fourth-quarter economic growth was estimated to be 0.3%, officials are now doubling their forecasts for 2010 growth from 0.75% to 1.5%, even though no new infusions of government stimulus cash are planned. Similarly, in Germany, an initial prediction of a 1.2% gain for 2010 has been revised to 1.4% — despite the country's registering a flat fourth-quarter growth figure as government stimulus funds tapered off.

Buik worries that the bright outlooks ignore the darker realities of relying on government stimulus money to restore economic growth. "Ultimately, states are going to have to cut spending and raise taxes to pay for what they've already spent," he says. "That means a period of fewer public jobs, reduced aid payments and less disposable income in consumers' pockets. Businesses will only start reinvesting money on production and jobs when they're sure demand has returned — and that isn't likely before we see government undertake cost-cutting we know is inevitable." (Read a piece on London as part of TIME's Davos coverage.)

Although other experts largely agree that governments — and ultimately taxpayers — will end up footing a hefty bill for all the stimulus money, some don't believe this will necessarily mean that Europe's modest growth rates are doomed to slip back into the red. Eric Heyer, an economist at the French Economic Observatory in Paris, says the official forecasts of continued modest growth are feasible — although that doesn't mean an immediate recovery for many nations. Even if European economies can nurture gradual expansion, he says, most will still see unemployment continue to rise through 2010 and into next year — if companies indeed become convinced it's safe to invest again.

If that's the case, then Europeans have an entire year to wait before macroeconomic improvements spill over into the microcosms of their lives. It would also explain why Tuesday's news out of London failed to generate cheers of hope elsewhere in Europe.

Read more: http://www.time.com/time/business/article/0,8599,1956794,00.html#ixzz0dnlgzTvP

Tuesday, January 26, 2010

Saudi Arabia to pursue stimulus, expects growth of more than 4% in 2010
Posted by BusinessIntelligence Middle East
Source: BI-ME and Bloomberg , Author: BI-ME staff

Posted: Sun January 24, 2010 5:16 pm


SAUDI ARABIA. Saudi Arabian Finance Minister Ibrahim al-Assaf said the kingdom will continue to pump money to boost growth in 2010, even as the economy rebounds from last year's stagnation.

“At one point there will be a curbing of spending, but in my view 2010 is a year that needs continuous stimulus to the economy,” al-Assaf said today at the Global Competitiveness Forum, an investors’ conferencein the Saudi capital.

Saudi Arabia expects growth of more than 4% in 2010, the finance minister said. The country’s economy expanded 0.15% in 2009, according to Ministry of Finance estimates.

“Stimulus packages shouldn’t be withdrawn prematurely, nor should they be extended more than required so as not to produce inflationary pressures,” al-Assaf said.

Cuba woos Saudi investors
Posted by Saudi Gazette
By Shahid Ali Khan
Tuesday, 26 January 2010 - 10 Safar 1431 H

RIYADH - Cuban Deputy Minister of Foreign Affairs, Marcos Rodriguez Costa is inviting Saudis to invest in his country that offers lucrative returns to foreign investors.

Costa, who arrived in Riyadh on Saturday on an official visit to Saudi Arabia made a detailed presentation at Riyadh Chamber of Commerce and Industry (RCCI) Monday highlighting business and investment opportunities in Cuba.

Saad Bin Ibrahim Al-Maoja, vice-chairman, RCCI Board of Directors and a number of Saudi businessmen were present in the presentation.

The Cuban deputy minister has identified a number of sectors for Saudis to invest in Cuba. He said the priority foreign investment sector in Cuba include oil and mining, energy, packaging industry, chemicals, tourism, sugarcane and related products and glass production.

Costa underlined the Cuban business environment citing highly skilled labor, saying that the country’s social and political stability are factors that offer foreign investors a lucrative environment for investments.

He said Cuba’s integration with Latin America and the Caribbean region offers an added advantage to the investors.

Saudis can also invest in Cuba’s priority projects including electro-energetic, hydraulics and in sectors such as construction, healthcare, renewable energy, transport and number of food programs.

Cuba follows international practices in its foreign trade and nearly 668 foreign companies have been represented permanently in Cuba, he said.

“It is not required to have a branch office or to be registered in Cuba to carry out trade operations with domestic entities,” he said.

He said Cuba has eased procedures and regulations for foreign investors, adding that Cuba has no import license system and import prohibitions apply only to related psychotropic substances and drugs.

The foreign investors can follow simple procedures to invest in Cuba which include identification of area of investment, getting letter of intent, documentation and among other things.

“Cuba offers safety for expatriate workforce while the Cuban government has been engaged for the promotion of R&D for technology innovation and applications,” he said.

He said Cuba is hosting 18th International Trade Fair from Nov.1 to 6 and invited to Saudis to come and participate in the event.

Cuba has a population of 11.2 million inhabitants and the country’s official language is Spanish, with an adult literacy rate of 98 percent and unemployment rate at only 1.6 percent.

Cuba offers tax-free repatriation to investors’ dividends while the country levies 30 percent income tax and 25 percent tax payroll. - SG

Monday, January 25, 2010

‘Economy still needs stimulus’
Posted by Arab News
Ghazanfar Ali Khan | Arab News
Monday 25 January 2010 (09 Safar 1431)


RIYADH: Finance Minister Ibrahim Al-Assaf said Sunday the Kingdom will continue to pump money into the economy even as it rebounds from last year’s stagnation. The minister was delivering the keynote address at the Global Competitiveness Forum here.

“At one point, there will be a curbing of spending, but in my view 2010 is a year that needs continuous stimulus to the economy,” said Al-Assaf, on the second day of the forum. “Stimulus packages shouldn’t be withdrawn prematurely nor should they be extended more than required so as not to produce inflationary pressures.” Saudi Arabia expects growth of over 4 percent in 2010, said the minister. The country’s economy expanded by 0.15 percent in 2009.

Al-Assaf voiced his concerns over the weak business entities that have failed to cope with the biting economic recession. He pointed out that the Kingdom posted $12-billion deficit last year, the first shortfall since 2002.

Reacting to Al-Assaf’s statement, John Sfakianakis, group general manager and chief economist at Banque Saudi Fransi, said: “The Saudi economy has demonstrated far greater resilience and stamina compared to many G20 countries. The fiscal stimulus of Saudi Arabia is carried out without burdening the debt situation of the country. Saudi Arabia’s economy will grow no doubt in 2010 as confidence, lending and private sector appetite are rising.”

The governor of Saudi Arabian Monetary Agency (SAMA), Muhammed Al-Jasser, said the road to recovery for the global economy will be a long one given the depth of the financial crisis. “Given the enormity and the impact of the financial crisis on the global economy, the road to recovery will be a gradual process,” he said at the conference.

Al-Jasser said Kingdom’s growth in 2009 was “not bad.” “Put aside the oil sector, the rest of the economy continued to grow very comfortably,” said the SAMA chief. Nonetheless, 2010 should be even better because the fiscal stimulus seems to be still there and in the course of the year the global economic recovery should “reduce uncertainty for investors in Saudi Arabia,” he added. To this end, he noted that the Saudi Arabia’s benchmark Tadawul All Share Index jumped 27 percent in 2009 and gained another 2.8 percent this year.

Referring to the problems faced by Dubai, James Wolfensohn, former World Bank president, said that Dubai’s recent financial woes were the result of over-leveraging, reliance on continuous economic growth and too rapid a rate of development. “I think the leadership in Dubai had all the right objectives in terms of building an economically competitive environment without the benefit of hydrocarbons,” said Wolfensohn.

Abdul Aziz Al-Tamami, chief operating officer of Etihad Etisalat (Mobily), spoke about Mobily’s pioneering concept of caring for its employees, their needs and their aspirations, a concept he said Mobily was among the first to adopt in the Middle East and the Arab world.

News Link: http://arabnews.com/?page=6&section=0&article=131794&d=25&m=1&y=2010

Saturday, January 23, 2010

Ambitious plan launched at competitiveness forum
Posted by Saudi Gazette
Sunday, 24 January 2010 - 08 Safar 1431 H



RIYADH – An ambitious new program that will require all the country’s economic cities to provide world class government services to residents and investors within 60 minutes, 24 hours a day and seven days a week was launched Saturday night in Riyadh at the 4th Global Competitiveness Forum 2010.

Amr Bin Abdullah Al-Dabbagh, Governor of the Saudi Arabian General Investment Authority (SAGIA) announced the program under the name “60x24x7”. He said this program would replace the “10x10” program by the end of 2010.

The program will be implemented at the economic cities and aims to make these cities globally competitive.

The forum is being organized by the SAGIA under the patronage of King Abdullah, Custodian of the Two Holy Mosques. It included the participation of senior government officials, Saudi businessmen and 100 leading world personalities in business, economics, and politics. These people are expected to discuss in four days the most prominent issues and challenges facing the global economy.

Al-Dabbagh said the competitiveness forum has become an international event where different ideas and visions on the concept of competitiveness are crystallized.

Improving the competitiveness of the government and private sector is imperative for economic growth and helps increasing the country’s Gross Domestic Product (GDP), which would increase the per capita income and create job opportunities for citizens He said the most competitive countries of the world are those that achieve high rates of growth, development and prosperity for their people.

Al-Dabbagh said SAGIA made it a point to study the successful experiments and experiences in attracting investments. It was clear to SAGIA that there was a close link between the degree of competitiveness of any country and its capability to attract investments. He said Singapore has been able to become a distinctive economic power and a center for attracting investments despite not possessing natural resources. This has happened because of its high competitiveness and its occupying a leading position in numerous international competitiveness reports for several years consecutively.

Al-Dabbagh said boosting competitiveness of any country requires building an integrated system, including the legal and organizational environment and the administrative procedures that govern the work of the government and private sectors.

Al-Dabbagh said the Kingdom had announced four years ago a short term goal to upgrade competitiveness of the investment environment through the 10x10 program that focuses on making the Kingdom among the ten best countries in the world in terms of the competitiveness of the investment environment by the end of 2010.

He said there was a close relationship between the degree of competitiveness and the investment environment in different countries as well as the flow of capital to them. He said the Kingdom was top among the Middle East countries and the fourth in the world with regard to the actual flow of direct foreign investments exceeding $38 billion, according to a UNCTAD report.

Al-Dabbagh said actual foreign and joint investments have contributed during the past five years in creating 335,000 jobs, 29 percent of which are occupied by Saudis, that is, more than double the Saudization percentage in the private sector companies of 13 percent. – SPA


News Link: http://saudigazette.com.sa/index.cfm?method=home.regcon&contentID=2010012461165
Middle East economic growth to rebound to 3.7% in 2010, says World Bank
Posted by BusinessIntelligence Middle East
Source: BI-ME , Author: BI-ME staff
Posted: Thu January 21, 2010 3:15 pm

INTERNATIONAl. Middle East and North Africa economic growth will accelerate from an estimated 2.9% in 2009 after the global credit crisis sent oil prices tumbling, the World Bank said in its latest report published today.

According to the Global Economic Prospects 2010, the regional economy will grow 3.7% this year and 4.4% in 2011. Growth was 4.3% in 2008, the bank said.

“Stronger global activity should allow for crude oil and gas production to return to positive growth, implying moderate revenue gains,” the World Bank said.

Following a peak in July 2008 of about US$147 a barrel and a low of US$34 in December of the same year, oil prices have settled into a range of US$65- US$$80 a barrel following output cuts by the Organization of Petroleum Exporting Countries, the report said.

Gross domestic product in Saudi Arabia, Kuwait, Oman and Bahrain, members of the Gulf Cooperation Council, contracted about 0.6% in 2009, compared with growth of 4.6% the year before, the report said. Growth in the four countries may reach 3.2% this year and 4.1% in 2011, it said.

Growth in developing oil exporters -- Iran, Syria, Algeria and Yemen -- is expected to reach 3.1 percent this year and 3.7 percent in 2011, the bank said.

Egypt's economy may grow 5.2% this year and 6% in 2011, the report said, from an estimated rate of 4.7% in 2009. The Lebanese economy is expected to maintain a growth rate of 7% through 2011, it added.

There remain “substantial downside risks, which would pose additional challenges to policy makers already grappling with the current crisis” in the region, the report said.

The risks include political tensions and the possibility of a deeper global recession, the report said. The debt crisis of Dubai World, one of the emirate’s three main state-owned business groups, indicates that “financial institutions in the region were not entirely unaffected by the global financial crisis,” the World Bank said.

The Global Economic Prospects 2010 expects the global economy to grow 2.7% this year and 3.2% in 2011 after contracting 2.2% in 2009.

"A great deal of uncertainty clouds the outlook for the second half of 2010 and beyond," the report said.

Though the "acute phase" of the crisis had passed, chronic weaknesses remained, it said. Much depended on the timing of withdrawal from massive stimulus programmes and adjustments to monetary policy, it added.

Mishandling could result in a "double-dip", with a return to recession in 2011, it warned.


News Link: http://www.bi-me.com/main.php?id=43642&t=1&c=34&cg=4&mset=1011
Venezuela oil reserves may be twice the size of Saudi Arabia's
Posted by BusinessIntelligence Middle East
Source: BI-ME and agencies , Author: BI-ME staff
Posted: Sat January 23, 2010 3:41 pm


INTERNATIONAL. A new US government assessment of Venezuela's oil reserves could give the country double the supplies of Saudi Arabia.

Venezuela's Orinoco oil region contains about 513 billion barrels of crude that could technically be recovered by energy companies if cost were not an issue, the report said on Friday.

Scientists working for the US Geological Survey say Venezuela's Orinoco belt region holds twice as much petroleum as previously thought.

This assessment is far more optimistic than even the best case scenario put forward by President Hugo Chavez.

It is the largest crude oil resource assessment ever done by the US Geological Survey for one area and its first for the Orinoco Oil Belt, a region in central Venezuela that contains heavy, thick crude that does not flow very easily.

Not all the region's oil in the USGS' resource estimate could be drilled at a profit, but the agency does not have a projection on how much of the Orinoco oil could be profitably drilled.

"We don't say anything about the economics of the oil," said agency spokesman Chris Schenk.

Schenk said the estimate was based on oil recovery rates of 40% to 45%.

The agency said its new estimate on the region's oil resources was based on advances in technology and new understanding in geology that "allow us to assess how much is now technically recoverable."

Petroleos de Venezuela SA (PDVSA), Venezuela's state oil company, has not commented on the news. However, Venezuelan oil geologist and former PDVSA board member Gustavo Coronel was sceptical.

"I doubt the recovery factor could go much higher than 25% and much of that oil would not be economic to produce", he told Associated Press news agency.

Other recent discoveries such as the one in March 2009 in Brazil or in the Gulf of Mexico later in the year have pushed some industry analysts to re-think 'global peak oil', or the idea that global production is near an apex after which it will decline sharply.

If the UGS assessment proves to be even remotely correct, it could have a substantial effect on the economics of oil, the geopolitics of Venezuela over the next decade as well as putting to bed 'peak oil.'

The theory of peak oil was first suggested by geoscientist Marion King Hubbert, who in 1956 predicted US oil production would peak between 1965 and 1970.

Figures from the US government Energy Information Administration show crude oil production peaked in the United States in 1970.

The Hubbert peak curve is a bell-shaped model of production for a particular country, region or the world, given an assumed total recoverable volume

Venezuela holds the largest oil reserves outside the Middle East. Saudi Arabia has proven reserves of 260 billion barrels.

News Link: http://www.bi-me.com/main.php?id=43661&t=1&c=34&cg=4&mset=1011
Asia Stocks Tumble After Obama Reforms
Posted by www.Time.Com
By AP / JEREMIAH MARQUEZ
Friday, Jan. 22, 2010



The benchmark Nikkei 225 Stock
Average dropped 295.40 points
Koji Sasahara / AP

(HONG KONG) — Asian stock markets tumbled Friday after President Barack Obama proposed a sweeping overhaul of Wall Street banks to avert future financial crises.

Losses spread across most markets and sectors across the region, following an overnight retreat in the U.S.

Commodity prices eased while the dollar lost ground against the yen and euro.

Obama said he would seek to limit the size and complexity of large financial companies so their collapse wouldn't imperil the broader financial system and economy, leading to more bailouts at taxpayers' expense. The move comes amid growing public frustration with Wall Street and bank rescues.

As in the U.S., bank stocks fell in Asia but other industries also suffered steep drops as investors scaled back their riskier bets amid uncertainty about the ultimate effects of the U.S. proposal.

Japan helped lead Asia's declines, with the Nikkei 225 stock average plummeting 330.15 points, or 3 percent, to 10,538.26.

Elsewhere, Hong Kong's Hang Seng dropped 593.28 points, or 2.8 percent, to 20,269.39 and Korea's main market index lost 52.08 points, or 3 percent, to 1,669.93.

China's Shanghai benchmark fell 2.2 percent, India's market shed 1.8 percent and Australian stocks retreated 1.8 percent.

In the U.S. Thursday, Wall Street was yanked lower by heavy selling in bank stocks.

The Dow fell 213.27, or 2 percent, to 10,389.88, its biggest point and percentage drop since Oct. 30.

The broader Standard & Poor's 500 index fell 21.56, or 1.9 percent, to 1,116.48. The Nasdaq composite index fell 25.55, or 1.1 percent, to 2,265.70.

Oil prices fell in Asia, with benchmark crude for March delivery down 19 cents at $75.89 a barrel. The contract dropped $1.66 to settle at $76.08 overnight.

The dollar weakened to 89.91 yen from 90.49 yen. The euro was higher at $1.4120 from $1.4082.

News Link: http://www.time.com/time/business/article/0,8599,1955857,00.html

Thursday, January 21, 2010

World Bank warns of 'double dip' as stimulus wanes
Posted by BusinessIntelligence Middle East
Source: BI-ME , Author: BI-ME staff
Posted: Thu January 21, 2010 12:23 pm

INTERNATIONAL. World growth may wilt later this year as government stimulus packages fade, The World Bank warned Wednesday in its latest report.

According to the Global Economic Prospects 2010, the global economy will grow 2.7% this year and 3.2% in 2011. It contracted 2.2% in 2009.

"A great deal of uncertainty clouds the outlook for the second half of 2010 and beyond," the report said.

Though the "acute phase" of the crisis had passed, chronic weaknesses remained, it said. Much depended on the timing of withdrawal from massive stimulus programmes and adjustments to monetary policy, it added.

Mishandling could result in a "double-dip", with a return to recession in 2011, it warned.

In the US, growth is projected at 2.5% in 2010 and 2.7% in 2011. European economies will see a slower recovery, with growth forecast at only 1% in 2010.

China's economy, whose recovery has led the global rebound, will expand by 9% this year and the next, the report said. China has reported that its economy surged 10.7% in the fourth quarter of last year, with annual growth for 2009 at 8.7%.

Developing countries will as usual see higher growth rates, at a combined 5.2% this year, but will be plagued by shortages of financing and investment that will handicap their progress.

Rich countries will grow more slowly, by 1.8% in 2010, as fragile financial markets and anaemic private demand crimp job creation and investment, the report says.

World trade volumes, which fell by a staggering 14.4% in 2009, are predicted to expand by 4.3% and 6.2% this year and in 2011, said the World Bank.

FRAGILE GROWTH

The report warned that while the worst part of the financial crisis might be over, the global recovery was still fragile.

"The global economic recovery that is now underway will slow down later this year as the impact of fiscal stimulus wanes. Financial markets remain troubled and private sector demand lags amid high unemployment," said the report.

"Overall, these are challenging times," said Justin Lin, chief economist and senior vice president of the World Bank.

"The depth of the recession means that even though growth has returned, countries and individuals will continue to feel the pain of the crisis for years to come," he said.

The World Bank predicted that the fallout from the crisis would change the landscape for finance and growth over the next 10 years.

Hans Timmer, an author of the report, said data indicated that unemployment would only get worse.

"Actually growth this year is not even strong enough to generate the jobs for the new people that are coming on the global job markets, let alone that you need to create employment for people who have lost their jobs in 2009," Timmer said at a news briefing.

UNCERTAINTY CONTINUES

The World Bank said that considerable uncertainty continued to cloud the global economic outlook. Depending on consumer and business confidence in the next few quarters and the timing of fiscal and monetary stimulus withdrawal, growth in 2011 could be as low as 2.5% and as high as 3.4%.

The report warned that, despite the return to growth, it would take several years before economies recoup the losses already endured. It estimated that about 64 million more people would be living in extreme poverty (on less than US$1.25 a day) in 2010 than would have been the case had the crisis not occurred.

Further, in the next five to 10 years, increased risk aversion, a more prudent regulatory stance, and the need to curb some of the riskier lending practices during the boom period that preceded the crisis can be expected to result in scarcer, more expensive capital for developing countries.

"As international financial conditions tighten, firms in developing countries will face higher borrowing costs, lower levels of credit, and reduced international capital flows. As a result, over the next five to seven years, trend growth rates in developing countries may be 0.2%-0.7% lower than they would have been had finance remained as abundant and inexpensive as in the boom period," said Andrew Burns, another author of the report.

"Policy can help mitigate the worst symptoms of this crisis," said Justin Lin. "However, there are no silver bullets and achieving higher growth rates will require concerted efforts to increase domestic productivity and lower the domestic cost of finance."

News Link: http://www.bi-me.com/main.php?id=43627&t=1&c=34&cg=4&mset=1011

Wednesday, January 20, 2010


Middle East M&A 2009 volume drops 39%, value rises 13%
Posted by BusinessIntelligence Middle East
Source: BI-ME , Author: BI-ME staff
Posted: Wed January 20, 2010 11:49 am


INTERNATIONAL. There has been a slight increase in annual deal value of Middle East M&A despite a decline in volume, according to the latest mergermarket Middle Eastern M&A Round‑up.

After a quiet kick-off in 2009, M&A activity picked up sharply in the second half of the year, with an overall value of US$17.9 billion, 13% higher than in 2008.

Despite a strong finish in the last quarter of 2009 with 40 deals, a 100% increase on the 20 deals recorded in first quarter, the overall count for the year was down to 107 announced deals from 176 in 2008, a drop of 39%.

Foreign M&A investment reached its lowest point since 2005, with outbound M&A activity valued at US$17.3 billion on 57 transactions, down 57% compared to 2008.

Inbound activity followed the same downward trend, with 35 announced deals, down from 64 in 2008, a decline of 45%. At US$2.7 billion, deal values were also in sharp decline, 60% compared to 2008.

Morgan Stanley and Shearman & Sterling top league tables

Morgan Stanley, ranked 12th by both value and volume in 2008, topped the 2009 rankings having advised on nine deals with a total value of US$10 billion.

The US firm was well ahead of Deutsche Bank (US$6.6 billion) and Bank of America Merrill Lynch (US$5.8 billion). UBS, the most active firm in 2008 in the region, fell to sixth in the volume rankings.

Shearman & Sterling topped the legal advisory tables, by both value and volume, with ten transactions valued at US$14.3 billion, including five of the top 10 deals for 2009.

The New York based firm had ranked third by both value and volume in 2008. Allen & Overy, its UK based competitor which held top spot in 2008, ranked fourth by value and second in the volume table.

Outlook for 2010

The global economic turmoil in 2009 did not escape the Middle East region. RBS added the UAE and Bahrain to a group of developing economies considered most at risk of a debt crisis - especially after the announcement of the US$22 billion debt by state-owned conglomerate Dubai World.

However, the situation in the region is expected to stabilize after the US$25 billion financial support provided by the Abu Dhabi government, the UAE central bank and two Abu-Dhabi based banks.

The public markets were the venue for many of the Gulf region’s most significant announced transactions in 2009 – including the acquisition of a 50% stake in Iran Telecom for US$7.8 billion.

But many deals have been slow to come to fruition. Barwa’s merger with QREIC was revealed in mid-January 2009, but it was not until January 2010 that the initial terms of the deal were announced.

Some transactions have also lapsed over time. The acquisition of Dragon Oil for US$1.1billion was cancelled last December, while the biggest expected deal in 2009, the proposed sale of a 46% stake in Kuwait-listed telecom Zain for a record US$13.7 billion, has faltered as the consortium of sellers appear to have jumped the gun and announced the transaction before the details had been finalised.

These lapsed transactions represent a good prospective M&A stream for the Middle East. Indeed, the targets are still on the market and will attract the interest of potential bidders in the coming year.


News Link: http://www.bi-me.com/main.php?id=43590&t=1&c=34&cg=4&mset=1011

Monday, January 18, 2010

UK firms warned 'worst still to come'
Posted by BusinessIntelligence Middle East
Source: BI-ME and UKPA , Author: BI-ME staff
Posted: Mon January 18, 2010 9:52 pm


INTERNATIONAL. More than 140,000 UK companies fell into financial trouble in the final three months of 2009 as experts have warned the worst is yet to come for recession-hit firms.

The latest "Red Flag Alert" report from insolvency firm Begbies Traynor showed a 6% hike in the number of firms that experienced financial distress between the third and fourth quarters of last year.

In an encouraging sign, the number of companies with either significant or critical problems in the fourth quarter fell 14% on a year earlier, marking the report's first year-on-year decline since the recession began.

But Begbies cautioned of a significant relapse in the third quarter of 2010 as companies face the most "dangerous phase" of a recession - the recovery.

The withdrawal of Government support measures, coupled with a lack of preparation and finance for the upswing in business will hit firms, according to the group.

Ric Traynor, executive chairman of Begbies Traynor, said: "Experience of the last four recessions tells us that unemployment levels and corporate and personal insolvencies have lagged behind technical recession by one to two years.

"With tax and interest rates certain to rise, as well as increasing pressure on consumer spending, there is every reason to suggest that the insolvency peaks of this recession remain some way off."

The group's report also found evidence that firms were failing faster than in previous recessions, with firms more willing to wave the white flag and companies also seeing a steeper collapse.

Monday's findings revealed that the British Government's soon-to-end car scrappage scheme failed to prevent a 26% surge in car firms falling into "critical" financial condition quarter-on-quarter, with the number also up by a fifth on 2008, according to the study.

However, there was a marked improvement in the battered retail sector after the peak of its woes in 2008, when high profile names such as Woolworths and Zavvi went bust.



News Link: http://www.bi-me.com/main.php?id=43532&t=1&c=35&cg=4&mset=1011

Sunday, January 17, 2010

Global recovery seems stronger but still fragile, says IMF
Posted by BusinessIntelligence Middle East
Source: BI-ME and IMF , Author: BI-ME staff
Posted: Sun January 17, 2010

INTERNATIONAL. The global economy is recovering significantly faster than previously expected, but growth is still dependent in most advanced economies on government stimulus measures and remains fragile, the Managing Director of the International Monetary Fund, Dominique Strauss-Kahn, said.

While emerging market economies—especially in Asia—were leading the recovery, most advanced economies were still sluggish, with private demand weak and joblessness continuing to rise, he told reporters.

“We are not out of the woods until the private sector has recovered,” Strauss-Kahn said at a January 14 news conference in Washington that he started by conveying deep sympathies to the people of Haiti following the severe earthquake. The Managing Director announced the Fund would provide $100 million to Haiti very rapidly in emergency help and would coordinate with other agencies to come up with a larger assistance package in due course.

Multi-speed recovery

On the global economy, Strauss-Kahn said he expected to see countries around the world recovering at different speeds in the various regions. He urged governments not to relax stimulus measures too early in the mistaken belief that a strong recovery had taken hold, and suggested that they could shift stimulus measures toward projects that would create additional jobs.

The IMF is scheduled to release its update on the global outlook on January 26.

Breaking down what had happened during the past two years of crisis and looking ahead to 2010, he said this year must be a year of transformation, to complete the reshaping of the global financial and regulatory system.

• 2008 was a year of humility: “our confidence in markets, institutions, and the status quo turned out to be complacency; we learned how fallible, fragile, and interconnected we are.”

• 2009 was a year of unity: “the world pulled together to respond to a profound economic—and potentially human—calamity, and redeemed the promise of international cooperation.”

• 2010 must be a year of transformation—“we must complete the global project to address the failings in regulation, economic policy, and governance that lay behind the crisis.”

Regulation and financial sector supervision needed to be not just stronger but smarter. The aim was not to impose additional layers of regulation.

There was a risk, he said that momentum for reforming the financial sector could be lost and policymakers should not forget the roots of the crisis. He welcomed a proposal by U.S. President Barack Obama that major U.S. financial firms pay a fee to help the government recover losses from the financial crisis, saying this showed that the world’s biggest economy was prepared to follow up although the crisis was receding.

At the request of the Group of Twenty (G-20) industrialized and emerging market economies, the IMF is scheduled to provide an assessment by April of options for how governments can get the financial sector to contribute to the costs of the crisis. Strauss-Kahn said society must move away from a system where banks can “privatize gains but socialize losses.”

The IMF’s priorities

Strauss-Kahn outlined four priorities for the Fund in 2010, and also said the institution was looking into proposals for how to finance climate change measures. “We will provide ideas in the near future,” he said.

In the coming year, the IMF would focus on delivering the economic regeneration that will drive growth in this new decade. The four priorities comprised:

• A sustainable recovery of output and employment must be the highest priority. The Fund will provide the kind of real-time analysis needed to see this project through, guarding against too early—or too late—reversal of stimulus measures.

• The IMF will continue efforts to provide the kind of financing needed to tackle modern crises and try to improve its toolkit of financing packages to help member countries to keep recovery programs on track.

• The IMF will try to keep the spotlight on the need to modernize financial sector regulation and put in place mechanisms to identify and tackle the hidden risks to country economies. The upcoming reform of the Fund’s mandate is a historic opportunity to do the same at the global level, with more focus on systemic—not just country—level risks, especially in the financial sector, and financing facilities that provide the kind of insurance needed to avoid excessive and costly reserve accumulation.

• The IMF will continue to improve its governance structure, with the Managing Director saying that the Fund would meet an end-year deadline to deliver a fair redistribution of Fund quotas, and to pursue other governance reforms.

Adjustments in the Fund’s mandate were needed to take account of modern-day crises that were far broader than traditional balance of payments crises, and to broaden its scope to take into account the need to ensure that any financial instability does not spillover into social tensions and become a danger to world peace.

Asia Conference in Korea

The Managing Director, who is visiting Tokyo and Hong Kong January 19-21, also announced that Korea and the IMF are planning to jointly host a high-level international conference on Asia in Seoul during July 12-13, 2010.

The conference will bring together leading policymakers from Asia and around the world to examine the region’s economic dynamism and evolving role in international policymaking. It will also provide the IMF an important opportunity to deepen its engagement with Asia.

News Link: http://www.bi-me.com/main.php?id=43488&t=1&c=35&cg=4&mset=1011

UK 'faces decade of economic pain,' says Ernst & Young ITEM Club report
Posted by BusinessIntelligence Middle East
Source: BI-ME and UKPA , Author: BI-ME staff
Posted: Sun January 17, 2010 10:41 pm


INTERNATIONAL. A leading economic forecaster is set to warn that the UK faces a decade of pain after a massive debt binge, it has emerged.

The Ernst & Young ITEM Club report, which bases its forecasts on official Treasury models, predicts that growth will struggle to reach 1% in a "challenging year".

Chief economic adviser Peter Spencer said: "We are no longer in a position to borrow - the massive debts that we racked up in the last decade now need to be repaid."

Official figures due later this month should confirm a pull out of recession in the final three months of 2009 but ITEM put this down to emergency measures such as the 'cash-for-bangers' scrappage scheme.

"Once the effects of these temporary stimuli have worn off, it is difficult to see where the growth is going to come from in the short-term," Mr Spencer added.

ITEM said the country had to boost exports over the long-term to avoid the risk of economic stagnation.

"It is vital the UK rejuvenates its overseas investment model and starts selling into countries such as China, where we have an exceptionally low market share compared to our leading competitors."

Interest rates have been at a record low of 0.5% since March last year and the forecaster expects them to remain at this level until "well into 2010".

ITEM added that it "remained concerned" over the UK's dire public finances, with net borrowing set to soar to a record £178 billion this year due to the impact of recession.

The forecaster said official forecasts were based on "very optimistic" assumptions for tax revenues and growth, while the Chancellor had also failed to set out "credible" plans for fiscal consolidation.

News Link: http://www.bi-me.com/main.php?id=43499&t=1&c=35&cg=4&mset=1011







Al-Mal investments bids for US$1.2 billion Philippines airport project

Posted by BusinessIntelligence Middle East
Source: BI-ME , Author: BI-ME staff
Posted: Sun January 17, 2010 2:52 pm


KUWAIT. Kuwait's Al-Mal Investment Co, said it has bid for a tender to develop an airport in the Philippines, valued at about US$1.2 billion.

"The firm notifies that it has bid for a tender to develop Clark airport with a cost close to US$1.2 billion," Al-Mal said in a statement on the Kuwaiti bourse website on Sunday.

Al-Mal has offered to develop three passenger terminals at the Diosdado Macapagal International Airport (DMIA) according to local Philippines media reports.

Al-Mal has committed to develop DMIA Terminal 2 at a total investment of US$100 million representing Phase I of the terminal I to be finished in two years. The terminal I will have a total floor area of 35,000 square meters and seven million passengers capacity per year, The Manilla Bulletin reported, citing Nestor Mangio, chairman of the Clark Airport International Corp. (CIAPC) which operates the DMIA.

Under the offer, Al-Mal will form a Joint Venture Company with CIAC on a 70/30 sharing in which CIAC to get 30% of the joint venture for contributing the leasehold rights over the land site. CIAC will not contribute cash or issue a government guarantee, according to the Manilla Bulletin.

Under the proposed airport development, DMIA runways will be further improved to accommodate bigger aircraft, hotels and commercial buildings as well as other aviation facilities will be constructed.

Al-Mal, which is controlled by the family-owned conglomerate Kharafi Group, said it was still in negotiations with the concerned authorities in the Philippines.


News Link: http://www.bi-me.com/main.php?id=43485&t=1&c=34&cg=4&mset=1011
Mövenpick boosts Saudi presence.
Posted by 4Hoteliers.com
Monday, 18th January 2010
Source : Mövenpick Hotels & Resorts

The Swiss hotel group announces the opening of its newest property in Saudi Arabia Mövenpick Hotel & Residence Hajar Tower Makkah.

A part of the prestigious Abraj Al Bait complex the Mövenpick Hotel & Residence Hajar Tower Makkah is superbly located directly on the Haram Court facing the King Abdul Aziz Gate.

Set on 41 floors, the hotel's 1204 spacious rooms and apartments are a showcase of quality accommodation. The Italian style interior design combined with the integration of modern technology together with a state-of-the-art business centre will appeal to pilgrims and business travellers.

With its ability to cater to large numbers the hotel boasts five versatile dining options. The Al Naseem is the hotel’s main dining restaurant offering a wide selection of international and local dining options while the spacious Al Firdaous restaurant seating 500 guests is ideal for large groups at any time of the day. Operating during the high season Hajar Restaurant is also an all day dining option serving up Arabic and international favourites such as grills, salads and seafood.

Strategically located in the lobby of the hotel the Al Diwan Tea Lounge is the best spot to enjoy a selection of teas and freshly brewed coffee as well as light snacks. Subtly placed seating for 200 guests and easy access make this the place to relax and watch the world go by. The Al Naim Lounge is the hotel’s second lounge and offers all day snacks and Mövenpick ice cream.

The tower’s first six floors comprise a commercial complex hosting 600 boutique stores offering the most renowned international and local designer brands.

“The holy city of Makkah is the most important destination for Muslims around the world and with over 4.5 million visitors during the Hajj and Umrah season we are confident that this new hotel will be a welcome addition to the city” said Omar Boujlid general manager Mövenpick Hotel & Residence Hajar Tower Makkah.


News Link: http://www.4hoteliers.com/4hots_nshw.php?mwi=6845