Middle East Business Review – 14 February

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Dubai’s property giant Emaar announced it registered a 161% increase in Q4 profits to the tune of $195m while posting an overall net operating profit of $560m and annual revenue of $2.209 billion during last year. The robust financial performance of Emaar in 2011 is a testament to Dubais status as the Middle East regions business and lifestyle hub. With The Dubai Mall hosting more than 54m visitors, the city has firmly established its global credentials as an international business and leisure destination. This status perfectly complements the strategically diversified business interests of Emaar, supported by our shopping malls & retail and hospitality & leisure businesses, which achieved solid growth in their contributions to recurring revenues in 2011, Mohammad Alabbar, chairman Emaar Properties, said in a statement.

Meanwhile, Emaar Properties has announced it will embark upon an ambitious expansion plan of the Dubai Mall to add another one million square feet to the existing 12 million square feet complex. “The addition of modern retail, leisure and hospitality choices as part of the one million sq ft expansion will take The Dubai Mall and Downtown Dubai into the next era in retailing and lifestyle development,” Mohammad Alabbar, chairman Emaar Properties, said.

Emirates Islamic Bank, part of Emirates NBD Group, reported a full-year net loss of AED448.55 million ($122.12m) in 2011 compared to a net profit of AED59.34m year before. The bank’s total assets diminished more than 32% to AED21.48bn ($33.65bn) last year compared to AED32.74bn a year before. EIB also reported a loss of AED45 million from investment in securities.

Abu Dhabi’s flag carrier Etihad Airways announced it will increase fuel surcharge on its flights to Europe to offset the costs of the Emissions Trading Scheme (ETS) initiated by the European Union. As an airline we are strongly opposed to the unilateral measures imposed by the European Union on our flights into and out of Europe, especially as they include areas outside European airspace. We have invested many millions of dollars to ensure we operate a young and highly efficient fleet but are still being penalised,” James Hogan, Etihad Airways President and Chief Executive Officer said.

Gulf Air has announced it is closing down four of its under performing routes on commercial grounds. “Our commercial strategy, developed in 2009 delivered significant gains in 2010 but last year has been challenging. Therefore, we are now adapting our approach to address the challenges on an urgent basis,” the airline’s CEO, Samer Majali, said in a statement while adding that these closures are “pragmatic commercial decisions” aimed at “focusing services on routes with higher passenger traffic”.

Kuwait’s longest serving central bank governor resigned in protest against ‘unprecedented’ increases in public spending expected to be initiated by the newly-sworn in government. “The challenge of current local economic conditions and forecast growth in public expenditure has reached a point where it would prevent the [central bank] from carrying out its duties as stated in the bill of its establishment,” Sheikh Salem Abdulaziz Al Sabah, who spent quarter of a decade at the helm of Kuwaiti financial affairs, said in an interview with the national news agency (KUNA). The newly elected government has announced plans to raise spending by 11% in the current fiscal year to a record 19.44 billion dinars ($69.85bn).

According to a study published by New York-based International Peace Institute, people in Middle Eastern countries that are marred by political instability are choosing to use dollars rather than their own currencies. The report examined the Egyptian economy where foreign currency deposits in local banks increased 15% in 2011 soon after the downfall of Hosni Mubarak. Demand for dollars in Syria registered a sharp increase as soon as the armed uprising against the Al Assad regime intensified with many people buying dollars in neighbouring Iraq and selling them illegally in the country. The study also added that people in volatile Libya line up at banks every morning to purchase dollars.

A report published by CNN, coinciding with Valentine’s Day, claimed Lebanese people are the 6th most romantic people in the world. “They are different from the rest of the Arab world and they know it. Blessed with olive skin, soulful dark eyes and smouldering looks (not to mention a penchant by some for surgical enhancement), the Lebanese make full use of their physical attributes,” the report explained while adding that one ‘seduction secret’ of the Lebanese is ‘liberal application of hair gel and a designer shirt’.

(By Moign Khawaja – Editor: Arabian Gazette)

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