Middle East Business News Review – 30 September

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

Dubai H1 FDI accounts 1.5% of total global; exceeds $4bn mark

Foreign direct investment (FDI) in Dubai hit AED16.5bn ($4.49bn) during the first six months of 2012, official statistics released on Sunday revealed.

According to the foreign investment office in the emirate’s Department of Economic Development (DED), 113 companies initiated 115 FDI projects during the first half of the year, which accounted for 1.5% of total global FDI projects.

The report added that January saw the highest average capital investment while the highest number of projects in a single month (26) was recorded in April 2012. The figures showed that total FDI flowing into Dubai during January-June 2012 increased 7% in the first half of 2011.

Fujairah oil storage space to double soon, Oil exploration in full swing

Vitol Tank Terminals International (VTTI) said on Sunday it intends to almost doubling its oil storage capacity at the port of Fujairah, just outside the Strait of Hormuz, and could start construction by early 2014.

VTTI is jointly owned by the world’s largest oil trader Vitol and Malaysian shipping company MISC Bhd. The Fujairah terminal, 90% owned by VTTI, while the remaining 10% held by the emirate of Fujairah, has 1.18 million cubic meters of storage capacity in a total of 47 tanks.

According to a VTTI spokeswoman, the Dutch company has plans to increase oil storage capacity by 1 million cubic meters.

Baghdad-Kurdistan reach oil payments deal

Kurdish Energy Minister Ashti Hawrami announced on Sunday Baghdad will transfer oil payments to Erbil as part of efforts to resolve a long-running conflict between the central government and autonomous Kurdish region.

Iraq’s federal government and Kurdistan agreed earlier this month to negotiate a dispute over oil payments after the latter pledged to continue exports and former saying it would pay foreign companies working there.

Baghdad has previously denounced KRG’s deals with foreign oil majors, such as Exxon and Chevron, and termed them as illegal.

Work on Iran-Iraq gas pipeline in full swing, to be ready by mid-2013

An Iranian official said on Saturday the country expects to begin exporting natural gas to neighbouring Iraq by the summer of 2013, semi-official Mehr news agency reported.

In an interview with Mehr, Javad Owji, managing director of the National Iranian Gas Company said Tehran has completed more than 25% of a pipeline to Iraq that could carry up to 25 million cubic metres per day of its natural gas to Iraq.

Turkey PM vows to clear off IMF debt by April next year

Turkish Prime Minister Tayyip Erdogan announced at a party congress on Sunday Ankara will clear its remaining $1.3 billion of debt to the International Monetary Fund (IMF) by next April.

Turkey has heavily relied in the past on IMF loans to meet its financial shortfalls, but has managed to do without the aid since 2008. It has been gradually reducing its debts to the fund, which stood at $1.9 billion in late May.

“We took over $23.5 billion of debt. As of now we have $1.3 billion of debt and we will cut it to zero in April. We are holding technical discussions now,” Erdogan was quoted as saying at the congress by Reuters. Turkey’s last standby agreement with the fund was in 2005 and expired in May 2008.

No new fees in 2013 federal budget

The UAE has no plans to introduce new fees or raise fees on government services in its 2013 federal budget which is expected to be released shortly, a the finance ministry undersecretary was reported on Sunday as saying.

Younus Khoury said the 2013 budget is part of a three-year Dh122-billion fiscal plan launched by the ministry in 2011 as part of a strategy intended to slash the UAE’s deficit and achieve a balance federal budget.

“There is no plan to introduce new fees or increase the present fees in the 2013 federal budget,” he told the Arabic language daily Alittihad.

Boeing, NBAD ink deal to develop aircraft financing

The National Bank of Abu Dhabi (NBAD) and aircraft manufacturer Boeing have signed an agreement to develop aircraft financing and leasing opportunities in the Middle East market.

The memorandum of understanding is aimed at increasing investment opportunities for financial institutions in the UAE and the broader Middle East region involving large commercial aircraft, a statement said.

The two firms said they were committed to work together to identify and pursue projects involving structuring and arranging financing and leasing of Boeing products and services to current and potential regional customers.

Dubai’s Drake & Scull Says Unit Gets Iraq Waste Water Treatment Project

Dubai’s Drake & Scull International, or DSI, said its Passavant-Roediger GmbH subsidiary has been selected by the Iraqi Ministry of Municipalities as the turnkey contractor for a waste water treatment plant located in the city of Kerbala.

“The project was awarded by Al Hanan Contracting Company and the contract value of Passavant-Roediger is AED 86 million,” DSI said in an emailed statement.

Under the terms of the contract, Passavant-Roediger will design and build the sludge treatment system of the plant based on anaerobic sludge digestion, including energy recovery and generation from biogas.

Qatar Airways says no plans to join oneworld alliance

Qatar Airways has no plans to join the oneworld airline alliance, its CEO Akbar al-Baker said on Sunday, dismissing reports that the airline had become the newest member of the group as “rumour”.

Asked if the carrier would join oneworld, which includes British Airways, owned by IAG, Baker said: “No, we will not. It’s all rumours.”

He was speaking on the sidelines of a conference in the UAE capital.

GE to invest $1bn in Saudi healthcare, energy

US giant General Electric (GE) has announced that it will invest around US$1bn in Saudi Arabia as part of the kingdom’s 2020 development plan.

The company said that the money would help Saudi Arabia diversify its economy and strengthen its manufacturing capabilities.

Part of the funds will go towards establishing a new healthcare learning and simulation centre in partnership with King Fahd Medical City. The US company will also launch the kingdom’s first heavy fuel oil technology programme, which it hopes will improve efficiencies in the conversion of fuel oil for power generation.

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