Middle East Business News Review – 15 October

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Today’s top business and economy news from the Middle East and North Africa:

UAE records $9.9bn fiscal surplus in 2011

The United Arab Emirates’ finance ministry said on Monday the state recorded a budget surplus of AED36.2 billion ($9.9 billion) in 2011, as it released the data to public for the first time. The ministry said the figures included the federal budget as well as the fiscal balances of all seven emirates which form the UAE.

Saeed al-Yateem, executive director of revenue and budget at the ministry, told a news conference that the data would now be released every quarter starting next year. Analysts believe this step could prove vital in increasing the confidence of foreign investors in debt issued by Dubai, Abu Dhabi and other emirates.

Some of the emirates, including oil-rich Abu Dhabi which accounts for around 78% of total UAE spending, have not been publishing budget plans or final accounts.

UAE launches its answer to Wikipedia

The UAE has unveiled an online encyclopaedia that allows users to contribute to and modify content in a vein similar to the popular Wikipedia site.

Announced at GITEX Technology Week by the Telecommunications Regulatory Authority (TRA), UAEPedia.ae follows an ‘open source’ model, allowing the public to create and edit their own entries on the website.

In its first phase, UAEOPedia.ae will only be available in Arabic, but the TRA says there are plans to add other languages later. Currently, the web site hosts close to 1,000 articles distributed over 18 main subjects including geography, history, economy, language and literature, as well as hundreds of sub topics related to the UAE.

Dubai’s Arabtec Says Unit Wins AED423 Mln Contract in Abu Dhabi

Arabtec Holding, in which Abu Dhabi’s Aabar Investments is the single largest shareholder, said Monday its construction unit was awarded a AED423 million ($115.3 million) contract in the UAE capital.

Arabtec Construction received a letter of award to build 411 villas and associated external works for Baniyas Residential Development in Abu Dhabi for housing UAE citizens, the Dubai-based company said in a statement posted on the emirate’s financial market website.

Arabtec has won several Abu Dhabi contracts this year, including a $3 billion deal–in a consortium–to construct a terminal building at the emirate’s international airport.

Qatar PM says looking favourably at Xstrata/Glencore deal

Qatar, the second-largest investor in miner Xstrata, is looking favourably at the company’s proposed merger with commodities trader Glencore, Prime Minister Sheikh Hamad bin Jassim al-Thani said on Monday.

Asked at a news conference if Qatar would support a merger, Sheikh Hamad said: “It is under a lot of consideration and focus. We are looking in favour of a merger between the two companies.”

The tiny, gas-rich Gulf state has become an unexpected kingmaker in Glencore’s bid for Xstrata, the world’s fourth largest diversified miner. Glencore bid in February for the shares in Xstrata it did not already own, launching one of the resources sector’s biggest-ever takeover deals. It was forced to raise its price after Qatar opposed the deal.

Saudi most spammed country in GCC – study

Internet users in Saudi Arabia receive more email spam than any other country in the GCC, according to the findings of a new report.

Online security firm Kaspersky Lab found that in the 3Q2012, Saudi Arabian inboxes were home to 0.96% of all spam globally. The UAE came second in the GCC with 0.19% of spam, followed by Kuwait. As a whole the region accounted for 1.29% of all worldwide spam.

On a global basis, Kaspersky Lab found that the US was the most spammed country with 26.71% of all spam traffic, followed by China with 25.52%.

Kuwait sees stable oil prices over next 5 years

Global oil prices should stay stable or fall just under their current levels over the next five years as Asian consumption makes up for a potential drop in European and US demand, Kuwait’s oil minister said on Monday.

Asia is the Gulf state’s biggest oil customer, receiving 65% of its exports, Hani Hussein told state news agency KUNA on the sidelines of an Asian summit in Kuwait. He said oil prices will remain “stable or just under the current level,” over the next five years thanks to “active and increasing” consumption in Asia, KUNA reported.

Consumption in Western nations could stay the same “or drop to a certain degree,” he added. OPEC member Kuwait produces around 3 million barrels of oil a day.

Iran banking on China to finish metro project

An Iranian government official said on Monday China will come to rescue its long-term ally and help complete its $2 billion worth Tehran metro rail project which has been marred by delays due to lack of financing as a result of sanctions.

Mohammad Montazeri, deputy managing director, planning & logistics, Tehran Urban & Suburban Railway Co said that the phase two of the metro, slated to be completed next year, is on track but two new lines under the third phase may be delayed due to lack of money.

US exports to Iran high despite more sanctions

Despite Washington’s tightening of financial sanctions against Iran, US exports to Tehran rose by nearly a third this year, chiefly because of grain sales, a report revealed on Monday.

According to Census Bureau data, US exports hit $199.5 million in the first eight months of 2012 from $150.8 million a year earlier, taking many economists and political observers by surprise as Washington, along with its Western allies, is applying measures to strangle Iranian economy in order to disrupt its nuclear programme.

Goods such as milk products and medical equipment – whose sale to Iran is allowed with a Treasury Department export license – continue to flow despite the sanctions.

Sudan rejects ‘inaccurate’ IMF report

The International Monetary Fund has painted a dim picture of Sudan’s economy in its semi-annual World Economic Outlook report released in Tokyo on Monday. The report was immediately rejected by some Sudanese economic experts.

Anayir, a Sudanese economist, blasted the “unfair and inaccurate” IMF report, and insisted that the outlook for Sudan’s economy is promising and seeing growth.

Meanwhile, in an interview with Reuters news agency, Sudan’s International Monetary Fund (IMF) Resident Representative Paul Jenkins welcomed the government’s tough austerity package but said it still needs to improve tax collection to overcome the loss of oil revenues.

Morocco may sell airline stake to major Gulf player

Morocco will offer to sell a 44% stake in its flag carrier Royal Air Maroc (RAM) to major Gulf airlines, an official source said on Monday.

The proposal will be made during a rare tour by King Mohammed of Saudi Arabia, Qatar, the United Arab Emirates, Kuwait and Jordan that starts on Tuesday.

“We will listen to their (Gulf airlines) ideas about how they see this partnership … For our part, we may propose the sale of up to 44% stake in RAM to the selected partner,” the source told Reuters.

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