THE FUTURE’S PLASTIC: ABU DHABI’S PLANS TO BE A POLYMER POWERHOUSE

Vol. 15 Issue 4 August 2010

SPORTING
CHANCE
From F1 to Olympic
dreams, how Gulf states
are positioning
themselves as
world players

COMING CLEAN CAT OUT THE BAG

Anti-corruption Jaguar boss outlines
drive continues Middle East plans
Bahrain..............BD 1.0

TRADING UP SINGAPORE SWING Kuwait............... KD 1.0

Oman................ RO 1.0
Qatar.................. QR 10
Bahrain’s new exchange Secrets behind a stunning Saudi Arabia.......SR 10
UAE.................. DHS 10
aims to be No 1 success story WWWGULFBUSINESSCOM
 THE DETAILS
Vol. 15 Issue 4 August 2010

THE COMMENT
12
Taking Stock
The bullish case for Asian shares.

14
Local Knowledge
It’s fantasy football as costs spiral
out of control.

16
Money matters
Have Gulf shares finally hit the bottom?

18
Emerging markets
What’s driving stunning growth
Game on
From the World Cup to the Olympic Games, Gulf
in Singapore?
states have their hearts set on hosting the world’s
20&22 biggest sporting events. An impossible dream? We

52
Guest columns check out the region’s track record as it puts
Euro troubles and the need for itself on the sporting map.
qualified CFAS.

24 40 THE BUSINESS
Letters Risk evasion
Islamic solutions for export 46
THE BRIEFING credit insurance. Plastic fantastic
Oil nations look to polymers
26 41 for diversification.
Regional Briefing The Terminal
Airports are becoming destinations 58
32
in themselves. Trading up
Bahrain exchange plans
Taking off 42 regional domination.
Pharma company first for Dubai
World Central.
Into Africa
Continent offers opportunities for 62
CSR projects. Corruption campaign
34 Taking action to clean-up business.
Muslim effect 43
Shari’ah compliant hotels show Branching out
robust growth. India’s IDIB sets up shop in Dubai.
THE PEOPLE
36 44
Sent packing? Legal threats 66
Meat trade with Australia under threat. Al Tamimi & Company on doing Market trader
business in Iraq. Souq.com’s Ronaldo Mouchawar on
38 kick-starting a digital revolution.
Big cat diary 45
Jaguar’s boss on his plans for the Dangerous waters 70
Middle east. How overfishing is putting crews at risk. Executive Moves

August 2010 gulfbusiness.com 5

F
THE DETAILS
Editor-in-Chief
Obaid Humaid Al Tayer
Group Editor and Managing Partner
Ian Fairservice

Group Senior Editor

Gina Johnson
Group Editor-Business
Alistair Crighton
Editorial Coordinator-Business
Concessa D’Souza

Art Director Cris Domdom

Senior Designer B Raveendran

Special Contributors and

International Correspondents
Berlin Wolfram Bielenstein
Hong Kong Michael McKay
Johannesburg Bill Cain

72
London Robert Bailey/Karen Thomas
New Delhi Rahul Bedi
Shanghai Gordon Hu
Washington Kevin J Kelley
Hospitality Guy Standish-Wilkinson

74
General Manager Production
and Circulation S Sasidharan
Production Manager C Sudhakar

General Manager Group Sales

Anthony Milne
Senior Advertisement Manager
Abraham Koshy

75
Advertisement Manager
Ajay Mathews

71
Competition

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82
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June 2009
76 Dabaghi on the future of
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6 gulfbusiness.com August 2010

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F THE COMMENT LEADERS
[ BUSINESS ETHICS ]
Coming clean on bad business
Transparency and corruption aren’t the same thing, but more of the first will mean
less of the other.
B usiness leaders, governments and the
media – this magazine included – have
been banging the drum about the need for far
more transparency and openness in the Gulf
for years now. That banging will continue for
many more years yet, but for the first time
it does seem that there is a concerted plan
across the Gulf to get their houses in order.
As the increasing number of executives
taking up residence in prisons across the
Gulf testify to, the boom years brought an
epidemic of bribery, backhanders, signing
fees and a host of other financial malfeasance
that’s only now coming to light. These cases
also show, however, that transparency and
corruption are far from the same thing, and
that bad business practices don’t always fall
out of the realm of legality.
First, transparency. Despite some high
profile arrests, details surrounding alleged
crimes remain murky in a number of cases.
Also, companies – especially banks – are not
yet coming clean on their financial health.
Given the weakness of the equity markets, this
is understandable, but not excusable. For a
real recovery in economic activity, we need to
at least know when we’ve hit bottom. Looking
at balance sheets in the first half results that
came out last month, this is far from the case,
with many acting as exercises in opacity and
obfuscation. Market sentiment will remain
weak for some time yet.
[ TELECOMS ]
Brought into the fold
The TRA is targeting security risks posed by the humble BlackBerry.
B lackBerry users – probably most readers
of this magazine – will remember the
hoopla a year ago when Etisalat, the UAE’s
biggest telephone operator, attempted to
install some unofficial software on users’
devices. The talk at the time was of attempts
to gain access to messages and emails that go
through the Canada-based servers belonging
10 gulfbusiness.com August 2010
Corruption, too, remains a grey area.
Business practices once deemed acceptable
when everyone made a lot of money, have now
been criminalised for some, but not for others.
While it’s good that the rule of law is being
applied, it needs to be seen to be applied fairly
and, excuse the pun, across the board.
Then there are the ones that slip through
the cracks. Across the region, well-connected
businessmen who have, in effect, defrauded
their own shareholders, or worse, have been
punished with little more than a slap on the
wrist. In one notorious case, they’ve even
been handed back control of their company
despite missing scheduled repayments to
those same shareholders they defrauded. The
message being sent out is not good, and will
do absolutely nothing to reassure the foreign
investors who left these shores in droves
during the crisis that the equity markets are
primed for a recovery.
As our Emerging Markets column has shown
over the past few months, there are dozens of
emerging and frontier markets out there with
better governance, better returns and less risk.
For those GCC states who see themselves as
potential global finance hubs on a par with
London, Frankfurt and Singapore, there’s still
a long way to go to achieve that dream. Better
regulation would be a start, but there needs to
be far better, and fairer, enforcement of those
regulations if trust is to be regained. ■
to BlackBerry owners, Research-In-Motion
(RIM), and are currently out of reach of
Etisalat or the UAE’s Telecom Regulatory
Authority (TRA).
Now, the TRA once again has BlackBerry in
its sights. A wave of media releases in recent
weeks have drawn attention to security issues
relating to the phone, and the TRA has now

come out and said it is actively looking at
ways to close the threat posed by the devices.
“The introduction of BlackBerry in the UAE
in 2006 pre-dates the 2007 introduction of the
UAE’s Safety, Emergency and National Security
framework, which regulates BlackBerry
applications in the UAE,” reads the latest
TRA release. “Currently, BlackBerry operates
beyond the jurisdiction of national legislation,
since it is the only device operating in the UAE
that immediately exports its data off-shore
and is managed by a foreign, commercial
organisation.
“As a result of how BlackBerry data is
managed and stored, in their current form,
certain BlackBerry applications allow people
to misuse the service, causing serious social,
judicial and national security repercussions.
“Like many other countries, we have been
working for a long time to resolve these
critical issues, with the objective of finding a
[ SPORTS ]
Game on for the Gulf
Why do we spend so much on attracting sporting events to the desert?
T he Gulf’s love affair with major sporting
events can seem a little counter-intuitive.
They’re expensive to host, offer limited
returns, frequently politically sensitive, and, if
organised badly, can backfire on the PR front.
Surely it’s much better to focus on
established sports that can be done well here
(motorsport, horse racing and, to an extent,
golf) rather than spending a fortune being
little more than a bit player on the wider
stage (cricket, tennis) Also, in terms of name
recognition and promotion, well, Emirates
has done an excellent job in international
sponsorship, and the largesse of football-
mad Emiratis have done much to endear this
part of the world with British football fans
(Portsmouth excepted).
So, why would Qatar bid for the World Cup?
Why is Dubai eying the Olympics? Given that
both are summer events, and the Gulf region
isn’t exactly known for its temperate climate,
do they have the same chance of winning as
our aforementioned Portsmouth does of being
European champions?
The answers are: “prestige”, “recognition”,
and “not necessarily”. Given the current
THE COMMENT LEADERS
solution that safeguards our consumers and
operates within the boundaries of UAE law.”
The TRA does not say anything concrete about
how it will bring BlackBerry into the fold, but
it is clearly looking at a major shake up in how
BlackBerry operates in the UAE. It is not up to
this magazine to question the laws of the land
regarding security issues, and the UAE obviously
takes the security threat posed by BlackBerrys
very seriously indeed. What is open to question
is exactly how the TRA intends to get its way.
RIM is a global company, and how amenable
it is to governments demanding changes to the
way it operates remains to be seen. Whatever
route the TRA takes to bring BlackBerry into its
fold, it’s going to require a major shake-up of
BlackBerry’s underlying technology, and users
should be prepared for big changes to how they
use their devices, especially the hugely popular
(and resolutely free of charge) BlackBerry
Messenger Service. ■
economic climate, and the continuing economic
fallout from Greece’s ruinous foray into the
Olympic arena, developed countries are going
to be a lot less enthusiastic to throw their
hats in the ring. Gulf states have the money
and desire to host these events, and, as Qatar
showed with the Asian games in 2006, and Abu
Dhabi with its world-beating Formula One
track which opened last year, they do have the
ability to put on a world-class spectacle. And,
it’s worth repeating, they have the money.
Just for once, though, it would be nice to
see the region’s propensity for one-upmanship
sidelined. Given the tiny size of most of the GCC
states, it could start looking ridiculous if we all
start competing against each other for the same
event. In fact, and with the South Korea/Japan
World Cup in mind, the chances of securing a
win would be greatly strengthened by a united
bid from all the GCC states. Sadly, Olympic rules
forbid this: it’s cities that bid, not countries. But
would Qatar’s chances of winning the World Cup
in 2022 be boosted by a joint bid? Forget a single
currency, a single tournament on that scale
would be a true symbol of unity and a major
achievement to boot. ■
August 2010 gulfbusiness.com 11
F
THE COMMENT LEADERS
[ INDUSTRY ]
The future’s plastic
It might not be glamorous, but plastics offer Abu Dhabi a winning formula.
T wo years ago, the Emaar subsidiary that
is building King Abdullah Economic City
(KAEC) in Saudi Arabia hit on the idea of
Plastics Valley. Perhaps not the most attractive
of names, this economic cluster was supposed
to be at the forefront of polymer production; a
global centre of excellence. Fast forward two
years and one financial crisis, and the project
is on hold as more competitive sectors take
priority. KAEC may well have been following
blueprints from an earlier, Dubai-based
project, that has also fallen by the wayside.
Despite being major oil producers and, in
Saudi’s case, an industrial force to be reckoned
with, Gulf states remained net exporters of
crude, the raw material for plastic production,
seemingly unable to come up with a way to
break into large-scale polymer production
themselves.
That should be about to change. Abu Dhabi
Polymers Park (again, not the most original
of names) is all set to be the world’s largest
plastics park. Launched by the Abu Dhabi
[ INVESTMENT ]
Whatever happened to PE?
Once touted as the Gulf’s next big thing, private equity deals are on the wane.
T he greed-ransacked hey-day of 2008
and its accompanying rally-cry of
private equity announcements seems ever
more distant. And despite bullish public
pronouncements from industry figures, deals
have remained rare.
Last year saw only 19 transactions in the
Gulf, totalling $561 million, compared to
55 transactions worth $2.7 billion in 2008.
The average deal size decreased to US$30
million last year, compared to $67 million in
2007, according to the Gulf Venture Capital
Association annual report.
Globally, the picture remains bleak.
Private equity fundraising had had its
worst year since 2004, with only $246 billion
raised; 62 per cent down on the record
12 gulfbusiness.com August 2010
Basic Industries Corporation, it fits in neatly
with the emirate’s ambitious 2030 strategy,
offering a plausible route for much-needed
diversification, and, within five years, hopes to
attract $2 billion in investment to the region.
Plastics isn’t the most glamorous of
industries, but it’s a critical and, above
all, realistic one for the region. High-
growth finance centres, sexy private equity
funds, media centres and runaway housing
developments may have been all the rage for
the past decade, but it’s interesting to note
that the real success stories – oil and gas
excepted – have been the far more mundane
sectors. Logistics, ports, metallurgy, chemicals
and aviation have been the region’s real stars,
steadily plodding along with only the latter
showing a hint of glamour. Adding polymers
to that mix will give Abu Dhabi and the wider
UAE another strong pillar as it seeks to
diversify away from its mainstay of exporting
oil. As industries go, it might be plastic, but
it’s far from fake. ■
$646 billion raised in 2007, according to
research firm, Preqin.
From this, it would be easy to surmise that
the Middle East’s fledging private equity
market was throttled before it had a chance
to grow up. However, the good news is that
MENA firms raised US$1.25 billion in the first
quarter of 2010, an 18 percent increase over
all of 2009, as regional economies recovered
and investor appetite returned.
And, as bankruptcy rates continue to rise
dramatically in the US and Europe and firms
continue to stem IPOs in the hope that prices
will recover, the private equity cards have
been unequivocally handed to the emerging
countries – whether the Gulf steps up to the
plate remains to be seen. ■

THE BULLISH CASE FOR
ASIAN EQUITIES
As one of the youngest, and yet largest, markets globally, Asia represents
tremendous growth potential for the investing crusader.
MATEIN KHALID
A
sia is the youngest, most populous, highest
growth, least-leveraged and most diverse region
in the global financial village. Asian shares were
range bound in 2010, and several major macro
catalysts will determine the return potential in Asian stock
markets in the next 12 months.
Chinese GDP growth has softened more than one point to
10.3 per cent in the second quarter. Industrial production,
car sales, the Shanghai equity index, power consumption,
bank loan growth and money supply have all swooned
since April.
The Middle Kingdom, Asia’s financial superpower, now
trades at a modest 14 times earnings for 20 per cent EPS
growth. The Politburo in Beijing and the Peoples Bank of
China has averted a protectionist backlash from the US
Congress with its cautious rise in the
yuan and ignited the colossal purchasing
power of China’s 1.3 billion consumers. Several major
The currency mini revaluation macro catalysts
also means China no longer needs to
aggressively raise interest rates to will determine the
combat property speculation, reducing return potential
the risk of a hard landing.
Asian equity valuations are also in Asian stock
cheap because the undeniable soft markets in the
patch in the US and fiscal austerity
in Europe clearly limits Asian export
next 12 months.
growth. The lukewarm performance of
mega IPO’s in Asia, such as China’s Agriculture Bank or
Russia’s Rusal in Hong Kong, has also muted the “animal
spirits” of Asian equities investors.
With $160 billion in Asian equity issuance estimated in
the second half of this year, Asian stock markets face an
undeniable liquidity drain. Asia (excluding Japan) trades
at a modest valuation of 13 times forward earnings. This
valuation incorporates the undeniable global macro risk in
China, Europe and the US. However, I expect a late summer
rally in Asia for five reasons.
One, the Agricultural Bank of China, the world’s biggest
IPO, is now public. Two, Intel reported record profits and
growth, suggesting that Silicon Valley product cycles
remain robust, a huge positive for Taiwan, Singapore and
South Korea’s high-tech blue chips. Three, the German-
French axis in the EU has designed a “shock and awe”
THE COMMENT ASIA
bailout package that has reduced sovereign risk in Spain
or Greece. Four, the US economic supertanker will slow
but not sink into double dip recession. Five, China’s equity
risk premium is now 10 per cent, excessive by any criteria,
including its own historical ranges in the past decade.
I believe specific themes can make money for Gulf
investors in the Asian stock exchanges. One theme is
technology, which has the world’s strongest corporate
balance sheets, growth prospects and product innovation
cycles. Taiwan technology shares trade at 10 times earnings
but could well deliver 40-60 per cent EPS growth next year.
Chinese equities are another theme that could well
bottom at 2300-2400 in Shanghai, which is a compelling
reason to buy Chinese megabanks ICBC, Bank of China
and China Construction Bank as the central bank eases
monetary policy and GDP growth
accelerates at 10-11 per cent.
The third theme is South Korea,
which is often ignored by Gulf investors
as an investment destination, even
though its companies manage some
of the biggest, most complex projects
in the GCC. GDP growth is stellar at
eight per cent, public spending as
a proportion of GDP is a fraction of
European, US or Japanese levels, and
the won is grossly undervalued.
South Korea’s Kospi is a buy below
1700 for a 2200 target in the next year. The index fund
that offers the broadest exposure to Korean shares is the
MSCI South Korean I-shares (symbol EWY). The recent
geopolitical tensions in North Korea have created cheap
valuations in Seoul at 11 times earnings.
The fourth theme is Asia’s economic superstar,
Singapore. It has global trade, shipping, aviation and
it has also created one of the world’s most high-tech
manufacturing economies.
Furthermore, the Singapore dollar is a floating currency, a
proxy for the Chinese yuan, Southeast Asia’s most credible
hard money. Singapore’s index fund (symbol EWS) is a
long-term winner, albeit only if it corrects to the 10-11 range.
Matein Khalid is a global macro trader, economics
professor, fund manager in a royal investment office
and writer in finance and geopolitics.
August 2010 gulfbusiness.com 13
THE COMMENT INSIDE TRACK
THE MADNESS OF
FOOTBALL FINANCE
While I am a fan of football, and the English Premier League in particular, the
amounts being flaunted to buy players and teams is sheer madness.
MISHAL KANOO
L
ast year, Real Madrid Football Club spent over
Euro 250 million on players, there was talk of
Liverpool FC being up for sale for around GBP
800 million and numerous other tales of money
madness, all despite the financial crisis that gripped the
world being at its peak.
For some strange reason, this small, but ever so
significant issue seemed to be oblivious from the minds
of the people not only selling football players and
teams, but from those who bought them or where even
contemplating buying them.
While I would love to own a football club, the cost of
running and maintaining such a folly is an incredibly
expensive exercise. I am sure most people have heard
of the Hicks/Gillette debacle involving Liverpool Football
Club after they took over and managed
to drive it into the ground, not only If one were to
financially but in football terms as
well. Then there is the much publicised
take a serious
Glazer family’s mishap at Manchester look at the costs
United. They have managed to turn the
world’s most profitable football club,
associated with
operationally speaking, into a huge buying a football
debt-ridden company owing over GBP
700 million.
team, one’s hair
And, of course, who can forget our would quickly
own home-grown, and very sad, story turn white.
of Sulaiman Al-Fahim and Portsmouth
FC? According to press reports, he invested GBP 60
million into the team only to see it evaporate as the
club went into receivership within six months. That was
despite three other owners entering the fray with even
more money in a bid to keep it afloat.
The one story I would like to highlight as a positive
of sorts is that of Robert Louis-Dreyfus who owned
Olympique de Marseille. He took this team from
struggling has-beens to French champions and European
contenders. The one caveat in this story is that it cost him
about Euro 1 billion of his own money.
The difference between his story and that of the ones
mentioned above is that he loved the game and, more
importantly, he loved the club. Thus for him, it was never
a business deal but a matter of funding his passion for
the club. Louis-Dreyfus was a self-made billionaire, thus
14 gulfbusiness.com August 2010
pumping his cash into his passion was a natural thing for
him to do. If the owner has the money and is passionate
about his club, then more power to him. But that is just it
– you need to have passion for the club.
Now I see money from our part of the world is being
used to buy stakes in football clubs, and in my opinion
the people with this money are doing so because they
believe financial gains can be made. Qatar has bought
into Spanish football club Malaga FC for Euros 36
million, while it was also reported that DIC was looking
to buy a stake in Liverpool FC for GBP 200 million.
The problem is that football clubs never make money
for their owners. If there is no passion connected with the
club and the game of football, then these teams are just
cost-laden businesses that will only make a profit if the
axiom of richer than thou, or dumber
than thou, applies.
In other words, unless the present
owner find someone who is richer
than him and is willing to buy the
club from him at a profit, he will never
make money.
If one were to take a serious look
at the costs associated with buying a
football team, one’s hair would
quickly turn white. From the players’
costs, both purchase and salaries, to
the manager, and not just him, but all
the staff that assist him, to the stadium, whether it is
owned or leased and whether it needs upgrading, to the
marketing costs that need to go into making the club a
success. But before all of this, you also have to consider
whether the club’s players are good enough to win
championships and cups and so lure sponsors and season
ticket holders, let alone precious TV time.
I love football and I love the excitement it brings, but
would I ever consider putting my hard-earned money into
such recklessness? The simple answer is no. Gone are the
days when we had true football players; instead today
we have entertainers who make more money for kicking
a ball than doctors who save lives. Can this madness
continue? Stay tuned for more idiocy to come.
Mishal Kanoo is deputy chairman of the Kanoo Group.
gb@motivate.ae
THE COMMENT STOCK MARKETS
IS IT TIME FOR A STOCK
MARKET RECOVERY?
The Dubai and Abu Dhabi stock markets are close to hitting bottom, and the
time to buy stocks again is very close.
PETER COOPER
I
n late July I gave a presentation to the largest gathering
of independent investors in the world in Vancouver,
Canada, hosted by Agora Financial, publishers of many
financial newsletters.
Sometimes you need to go a long way away to gain a
sense of perspective. But in essence my presentation
focused on the argument that the Dubai and Abu Dhabi
stock markets have to be close to an important bottom,
and that the time to buy stocks again must be very close.
The very fact that so many people reading this
column will roll their eyes in amazement and say that
things really are bad is one very good reason to be
optimistic. For when the consensus is so low that is often
the stock market bottom.
We have the classic signs of a market bottom: low
price-to-earning ratios; negative press;
big announcements which make no
difference to stock prices; 11 brokers The commercial
closed this year; a top broker just economics that
resigned; volume is down 90 per cent;
everybody is talking about how much delivered faster
they lost on Dubai property; capital growth than China
spending is lower; interest rates
are falling; hotel room rates are
from 2003 to 2008
down; foreign fund managers have have not died, despite
given up; there was a capital flight
after a property crash; Swiss bankers
the real estate crash.
are very negative.
The Dubai Financial Market was the world’s best
performing stock market in 2005, and the worst in 2006.
There was then a 50 per cent retracement by 2008 before
the renewed plunge that year. It looks like a classic
double top to me.
Surely from these levels a serious recovery is likely.
The only question is how long it takes for this
breakout. However, the UAE market moves on a
seven-year cycle. The previous low was in 1999 post
the Asian financial crisis.
So on that reckoning we are only two years away from
another peak. That might sound incredible, but just look
at how steep the upturn was in 2005. There is no reason
why history should not repeat itself as it so often does.
From my own experience in 2005, this phase can be
readily spotted. I bought a mutual fund in the first half
16 gulfbusiness.com August 2010
of the year and sold it at a 60 per cent profit six months
later. That was too early, but it did take out the sweet spot
in the middle. Others made 100 per cent.
I think this might well happen again as the result of
a sudden and dramatic lift in the oil price when the US
gets into its second or third stimulus package and sets
off dollar inflation. Or it could be down to some sort of
comprehensive peace initiative in the region – rather less
likely I admit.
You also have to consider the excellent business
fundamentals of Dubai. The commercial economics that
delivered faster growth than China from 2003 to 2008
have not died, despite the real estate crash.
Airport passengers and cargo grew last year by 9.2
per cent and 5.6 per cent respectively against the global
downturn. The Jebel Ali super port
was one of the least impacted by the
recession. Multinational companies
and banks continue to choose Dubai as
their preferred location in the region.
Tourism numbers are holding up
even if hotel rates are down sharply.
A lot of very wealthy people live in
the UAE, both as citizens and as tax
exiles, and they continue to spend
money. Officials say the population of
Dubai is still growing as people move
back from neighbouring emirates
thanks to lower rental prices.
The Dubai debt problem is also well known and being
addressed. Indeed, the final sign-off on the $23.5 billion
Dubai World debt rescheduling next month could be the
trigger for a rally in Dubai stocks, and doubtless Abu
Dhabi will move in tandem.
Have we not already seen green shoots in the desert?
On June 27, the second Dubai airport opened; there
was an $11.5 billion aircraft order for Airbus; and
two schemes to restart 45 to 60 per cent built
construction projects.
Now the local stock market is ignoring these catalysts,
but if past precedent is any guide they will work. History
has a habit of repeating itself, and stock markets do
eventually rise again after having fallen.
Peter Cooper is the editor of arabianmoney.net
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THE COMMENT EMERGING MARKETS
GROWTH IN SINGAPORE
CONTINUES TO DAZZLE
Singapore may be a small island in the South China Sea, but its economy is one
of the fastest growing in the world, even outpacing the giant population of China.
MICHAEL PREISS
S
ingapore is booming. Economic growth in the first
quarter of this year rose a breathtaking 45 per
cent. The economy is on track to be the world’s
fastest growing this year after record first half
growth numbers.
On an annualised basis, gross domestic product will
rise between 13 per cent and 15 per cent in 2010 making
it the highest in the world. Even if the economy shrinks in
the second half, full year growth could still be Singapore’s
highest ever and surpass even that of China and India.
Both the currency market and the stock market seem to
like the ‘Singapore Story’ and they are voting with their
money. While the US stock market is flat year-to-date, and
Japan is down seven per cent, China is down 26 per cent and
Hong Kong six per cent while Singapore is up four per cent.
According to Standard Chartered
Bank research, the Singapore dollar is Even if the
expected to surge by 12 per cent against
the US dollar by midyear 2011, while the
economy shrinks in
Euro and British pound are expected to the second half, full
stay weak and under the burden of very
heavy and record high public deficits for
year growth could
years to come. still be Singapore’s
Singapore is now the fourth wealthiest
country in the world in terms of GDP
highest ever and
(PPP) per capita, and the 20th wealthiest surpass China.
in terms of GDP (nominal) per capita.
Despite Singapore’s small size, it has the world’s ninth
largest foreign reserves and hardly any sovereign debt.
Sovereign wealth fund, Temasek is said to manage a global
portfolio of $186 billion including a stake of about 18 per
cent in Standard Chartered Bank.
The Economist Intelligence Unit, in its ‘Quality-Of-Life
Index’, ranks Singapore as having the best quality of life in
Asia and 11th overall in the world.
Singapore sees hundreds of thousands of foreign
expatriates working in multi-national corporations or
running their own companies.
Immigration policy is one the reasons for Singapore’s
economic success.
In Hong Kong it takes seven years to become a permanent
resident, in Singapore you can become permanent resident
after two years. Yet in Dubai you can have $100 million in the
bank and still have no permanent residence.
When I lived in Hong Kong during the 1990’s we used to
joke that in Singapore you are “Singa-bored”. Nightclubs
used to close at 2am and it was more of a sleepy town. Now
18 gulfbusiness.com August 2010
in 2010, Singapore is more happening than many other Asian
cities put together. Hong Kong in its relevant importance is
declining and Singapore is rising. Hong Kong suffers from
some of the world’s worst pollution, but Singapore has clean
air and much more space.
In the late 90s, then Prime Minister Kuan Yew Lee
apparently commissioned consulting firm McKinsey to find
out what is wrong with Singapore and why Singapore lagged
behind Hong Kong.
The city was already an important passenger hub, the
airport with the IATA code of SIN was one of the busiest
cargo airports in the world, handling over 1.66 million
tonnes of cargo, but business people somehow thought the
place was dull.
McKinsey apparently instructed Prime Minister Lee that
Singapore was missing the SIN in SIN.
The Singapore government dutifully
took note and deregulated nightlife,
freedom of the press, and even signed
a degree to allow casinos, or what they
locally call “IR: Integrated Resorts”.
In true Singapore spirit, however, the
locals have to pay S$100 per visit while
foreigners get in for free.
According to the Singapore Tourism
Board, tourist arrivals are likely to
increase to 12.5 million a year, with
year-on-year growth of 30 per cent. Tourism receipts are
estimated to surge 50 per cent to reach $18.5 billion.
In the old days, Switzerland was considered to be the
private banking capital of the world. Now in 2010 and
beyond, increasingly it is the Island State of Singapore that
is becoming the centre for wealth management globally.
UBS and even Credit Suisse today employ more staff
in wealth management in Singapore than they do in
Switzerland. UK taxing bonuses and high income tax means
more and more investment bankers, private equity firms and
hedge funds are moving from London to Singapore.
With regards to portfolios and fixed deposits, however,
it is surprising how few investors in the Middle East have
savings in Singapore Dollars.
Exposure to Singapore equities is also comparatively low
in Arabian and Middle Eastern client portfolios, but with
Singapore having the highest growth in the world, more and
more investors seem to take notice.
Michael Preiss is an investment advisor and finance
professor and can be reached at: Michael@michaelpreiss.net
THE COMMENT FOREIGN EXCHANGE

EUROPE’S SINGLE CURRENCY

COMES UNDER SCRUTINY
Despite its unparalleled success since its launch, the Euro is facing unprecedented
skepticism in the world press, but does this spell the end for the single currency?
ARJUN MITTAL

M
uch has been said and written about the
Euro in the global media over the last few
months, as the sovereign debt crisis exploded
onto our TV screens and newspapers.
Some renowned market commentators have suggested
that the crisis unfolding in Greece, which is threatening
to spread to other Eurozone members, could spell the
end for the single currency. Is this just scare mongering
or is the Euro in real danger?
At face value, the Euro has been an unqualified success
since its launch in 1999. It was adopted by member
countries very smoothly, and after initial hiccups,
quickly became a recognised alternative to the dollar. The
European Central Bank has also largely done a great job
in managing inflation across the diverse Eurozone, and
refraining from being as populist as
the US Federal Bank. The crisis unfold-
Finance students eager to learn
the ways of the world are taught that ing in Greece, which
currencies should, in theory, be driven is threatening to
by four key criteria: relative inflation
rates, relative productivity rates, trade
spread to other
surplus/deficits and capital flows. The Eurozone members,
Eurozone scores well on three out of
four, with only productivity across
could spell the end
the continent a noticeable laggard for single currency.
compared with the US.
Furthermore, it is not just Europe that is struggling
with high levels of debt. The USA for example is
scheduled to go over $14 trillion in government debt this
year, a truly staggering number, no matter how you mask
it in debt-GDP or debt-asset terms. Japan has debt-to-
GDP at almost 180 per cent, with an ageing population
and no immigration surely leading that nation down a
potential default path.
The Eurozone has also put in place some impressive
defensive mechanisms. The recent Euro 750 billion
($921.2 bn) package to support nations with debt
problems is a large war-chest that more than meets the
financing needs of Greece, Spain, Ireland and Portugal
for the next few years. The European Central Bank has
also stepped in to buy small amounts of sovereign bonds
in the last few weeks. And, more recently, many European
countries have announced large cuts in government
expenditure to rein in budget deficits.
So why are some still asking whether the Euro will
survive? The issue it seems to me is essentially one of
solvency. Financial markets currently just don’t believe
that Greece, along with some of its southern brethren like
Portugal and Spain, can pay back what they owe.
Faced with such circumstances, these countries
would normally seek funds from the IMF to cover their
obligations, and in return would agree to restructure their
economies to make the labour markets more efficient
and adopt more prudent fiscal policies to ensure the
government started to run budget surpluses. Some form of
debt restructuring would also be a possibility. In addition,
and most importantly, the respective
currencies would also be devalued
substantially, to help get the economy
moving forward again.
Now, here we have the problem. Greece,
for example, has to raise taxes and cut
back government expenditure, which
will undoubtedly slow economic growth,
but it does not have the ability to offset
this with currency devaluation. So how
is Greece going to kick-start economic
growth, which is eventually the best way
to pay back debt?
Well, as long as it stays in the Eurozone, its best options
are far-reaching labour and capital market reforms to
make the economy competitive. But this takes time and is
politically difficult at a time when your people have to cut
back on their lifestyle. Can the government stay the course?
I hope so, but it would take a brave man to bet they can.
In the meantime, the Eurozone and the Euro will face
considerable pressure. A weaker Euro, probably close to
$1.10 by the end of the year, seems likely. For those with
long-term investment horizons, buying shares of German
exporters, who will benefit from the weaker Euro, should
deliver good investment returns. ■
Arjun Mittal, is managing director of Bank
Sarasin-Alpen (ME).

20 gulfbusiness.com August 2010

THE COMMENT ACCOUNTING
DANGERS OF SAILING IN
UNCHARTERED WATERS
Accountants aren’t all cut from the same cloth, and in these troubled
times a qualified CFA could be a lifesaver.
BINOD SHANKAR
I
get my fair share of weird phone a calls and e-mails.
A case in point was one received week ago. A friend
called me breathlessly and said she was in a hurry
but could I please, please help her. I have always
been hopeless at saying ‘‘No” so I mumbled “Yes.”
The next thing I know she demanded that I help raise
her understanding of portfolio management. To Expert
level. In less than a week.
Now as requests go, this ranks right along with hoping
Dubai property prices pick up quickly and England
winning the World Cup; you dearly wish it would
happen but you know the chances are very slim indeed.
This made me ponder about the need for ramping up
financial literacy in this neck of the woods, something
other than the usual medley of BBA
and MBA courses that are, frankly, The next thing
very underwhelming. I mean, just
how do you label a BBA as majoring I know she
in Accounting and Finance when only demanded that
five of the 60 courses in that BBA cover
accounting!
I help raise her
So my thoughts immediately turned understanding
to something relevant and respected
in finance and zeroed in on the
of portfolio
CFA (Chartered Financial Analyst) management.
qualification.
The CFA curriculum does stand out from the crowd
of finance courses. To begin with, it is well structured.
It first covers all the tools and techniques such as
Economics, Quantitative Methods and Financial Analysis
(Level 1). Students then move on from the theoretical to
applying these concepts in real life situations, such as
Project Evaluation, Mergers & Acquisitions, Valuations
of companies and Bond valuations (Level 2). Finally,
Level 3 covers Portfolio Management.
It’s also fairly up to date – the curriculum is re-jigged
annually – and students these days get to learn about
exciting, fast growing areas such as Behavioral Finance,
Private Equity and Hedge Funds.
Increasingly, the qualification is fast becoming a game
changer for anyone looking for a career in investment
banking, asset management or research. There are
numerous MBA and other finance courses, but there is
only one CFA globally, and hence it is a passport to get
your foot in the door when aiming a lucrative career in
these areas.
22 gulfbusiness.com August 2010
Zubin Mithaiwalla works in private banking at
Emirates NBD. He says the qualification will help
him better advise his high net worth clients on how
to manage their wealth. There’s also the credibility
factor; Zubin says clients tend to trust their money with
someone who has a credible qualification such as a CFA.
Unlike the MBA degree, it is a self study course,
which is good in that you can work and study. The flip
side is that you have to be tremendously motivated and
disciplined to crack topics that could be as wide as they
are deep.
The CFA qualification is not a new kid on the block.
Far from it. It has been around since 1961 and today
there are 90,000 + charter holders globally. It used to be
a largely North American qualification,
but it has gone global over the last 10
years, so much so that these days 40 per
cent of new candidates are from outside
the US and Canada.
The UAE has the largest number of
candidates in the Middle East. Several
large companies strongly encourage and
support CFA education and at the Abu
Dhabi Investment Authority, Mubadala,
Standard Chartered Bank and Deloitte,
it’s the major criterion for promotion.
There are approx 500 CFA charterholders in the UAE
and nearly 2,000 students, and these numbers are seeing
exponential growth.
The exams are notoriously difficult (hideous was the
word used by an acquaintance!); the overall global pass
rate is an abysmal 19 per cent. Which means that 81
per cent of those who register for Level 1 don’t make it
past Level 3. The CFA Institute recommends 300 hours
of study for each level, which is easier said than done,
especially if you have to balance work, studies and
family life. The upshot is that hardly 6,000 individuals
get the charter every year.
That said, I am yet to come across an unemployed CFA
charterholder. So perhaps the demand-supply dynamics
work brilliantly in favour of anyone who has the letters
CFA after their name!
Binod Shankar is a Chartered Accountant and CFA
Charterholder. Binod runs Genesis Institute, a financial
training company. He can be reached on bshankar@
genesisreview.com. URL: www.genesisreview.com
 Malaysia Contemporary
Art Tourism Festival
July 1 – September 30, 2010

"Contemporary art is a passion

that unites discerning travellers
and tourists alike from all corners
of the world..."

Dato' Sri Dr. Ng Yen Yen

Minister of Tourism, Malaysia

Malaysia’s contemporary art scene is a reecƟon of the country itself. It is

varied, mulƟcultural and resists stringent deniƟon.

Just like Malaysia, a naƟon whose historic sites, towers of modernity and
glimpses of nature promise surprises and memories on every visit.

For the rst Ɵme ever, Malaysia’s Ministry of Tourism hosts the 1Malaysia
Contemporary Art Tourism FesƟval.

The fesƟval encompasses exhibiƟons, seminars, compeƟƟons and other fringe

events at various locaƟons around the country.

Come see how Malaysia’s renowned contemporary arƟsts have expertly woven
her history, naƟonal idenƟty, landscapes and people into painƟngs,
sculptures, photographs, installaƟons and more.

Whether it is abstract works that channel arƟsƟc soul, mixed media art that
shows oī arƟsƟc ingenuity or guraƟve works that display arƟst prowess,
Malaysia has it all.
Fatamorgana #2 The State of Confusion > 2006, oil on canvas, 244 x 150cm

The 1Malaysia Contemporary Art Tourism FesƟval is not to be missed. Visit

Malaysia and take part in history.

Events in Kuala Lumpur, Melaka, Johor and Penang | JUL 1 – SEPT 30, 2010 |

MCAT ExhibiƟon 2010 Art Seminar

Galeria Sri Perdana Starhill Gallery The Inuence of Mahathirism on The Aliya & Farouk Khan
3 July – 30 September 2010 July – September 2010 Contemporary Art CollecƟon Art Seminar
www.arkib.gov.my www.starhillgallery.com MaTic, Jalan Ampang Galeri Seni Rakyat, Melaka
20 – 24 September 2010 1 – 3 August 2010
Malaysia Tourism Centre (MaTic) Galeri Seni Rakyat (Folk Art Gallery)
15 July – 30 September 2010 1 August – 30 September 2010 IMCAS 2010 –The Aliya & Farouk Malaysia Contemporary
www.mtc.gov.my www.perzim.gov.my Khan CollecƟon Art Seminar Art Tourism Seminar
Danga City Mall, Johor Penang
Balai Seni Lukis Negara i-City Contemporary Art ExhibiƟon 27 September – 1 October 2010 18 – 19 August 2010
(NaƟonal Art Gallery) 11 August – 9 September 2010
July – September 2010 A Curatorial Discourse on the MALAYSIA’S FIRST EVER
www.artgallery.gov.my IMCAS 2010 Danga City Mall Making of an Artwork ART AUCTION
July – September 2010 12 Gallery, Kuala Lumpur Wisma Bentley Music
Galeri Petronas (Petronas Gallery) www.dangacitymall.com 8 – 10 July 2010 PJU 7/2, MuƟara Damansara
July – September 2010 Petaling Jaya
www.galeripetronas.com.my 1-8 August 2010

MINISTRY OF TOURISM MALAYSIA

Menara Dato' Onn, Putra World Trade Centre, 45 Jalan Tun Ismail, 50480 Kuala Lumpur
Tel: 603-2693 7111 www.motour.gov.my www.tourismmalaysia.gov.my
F
THE COMMENT letters@gulfbusiness.com
EXCLUSIVE: FRANK KHOIE ON PRISON, PROPERTY AND POWER SUPPLIES
Vol. 15 Issue 3
THE HIGH
COST OF OIL
After the Deepwater Horizon
disaster, we ask: how prepared
is the Gulf for the unthinkable?
THE BIG PRIZE
Iraq, uncertainty, and a $600 billion payday
CLEAN ENERGY
Stability key to the UAE’s nuclear success story
ETFs AHOY
New ways to invest in Saudi Arabian equities
GB Regional_JULY 2010indd.indd 1
Not so sweet dreams
I am shocked to hear that Mars Inc
is opening a factory in a country
that has the highest rate of diabetes
in the world. While I appreciate
this confectionary firm is taking
steps towards creating healthier
products out of the sweetness of its
heart, surely the solution is not to
encourage mass flogging of these
products at all?
Instead, the government should
deter a mass choc avalanche and
instead encourage grassroots health
and nutrition education.
‘Sugar-free’ products in themselves
can be harmful, due to the amount of
additives required to make them taste
real. And in the case of ‘flavanoid’-rich
bars which “help” diabetes 2 sufferers,
isn’t this rather like Stockholm
syndrome, where the sufferer falls in
love with the persecutor.
The firm also argues that as
Gulf Business welcomes your comments about the magazine or issues regarding business in the region. Please write to: The Editor, Gulf Business,
Motivate Publishing, PO Box 2331, Dubai, UAE; Fax to + 971 4 2827593; or email to: letters@gulfbusiness.com. We reserve the right to edit correspondence.
24 gulfbusiness.com August 2010
LETTER OF THE MONTH
Slick story
What a gripping cover story you had this month. I have been
July 2010
transfixed by the ever-escalating disaster occurring in the Gulf
of Mexico, and living in the UAE I have asked myself the same
question many times – what if we were next?
I must admit you had me reeled in with your Orson Welles’ian
introduction and I took a deep sigh of relief when you revealed the
truth. But I was truly duped.
I went on to read the whole piece and found your balanced
analysis offered a tremendous insight into the work that goes on
behind the shrouded doors of government. In fact, I was quite
surprised how candid the authorities were with you; in detailing
Bahrain..............BD 1.0
the work and research they are undertaking.
In light of the American ecological disaster, I feel that every
Kuwait............... KD 1.0
Oman................ RO 1.0
Qatar.................. QR 10
Saudi Arabia.......SR 10
UAE.................. DHS 10
WWWGULFBUSINESSCOM
6/28/10 8:39:33 AM
nation that undertakes any oil exploration has a responsibility to
research and report their threat levels and contingency plans – the
public has a right to know!
While it is clear the UAE is prepared for a disaster, it is very
disappointing that the disaster could be out of our hands. I find it
very disturbing that our neighbouring countries can permit their
infrastructure to decay to the point of failure – we need some kind
of unilateral enforcement.
Byron Pentecost, Abu Dhabi
an ‘occasional’ pleasure, sweets when it comes to investments.
consumption is not harmful. If That is why I am a bit confused
chocolate was an occasional treat, then about Lombard’s business model of
I wouldn’t be penning this missive as “two buckets of investment.” While
Mars would not be in business. the short-term bucket is linked to
Elasticated waistbands and bonds and forex, it is the longer-term
Frankenstien chocolate bars are not bucket targeted at the oil and gas
the answer. sector and the elderly that makes
Wendy Peters, Dubai me wonder how knowledgeable this
custodian of investments is about
Lehman Sisters ‘Lombarded’ this region with the highest youth
Michael Gordon’s Gender Studies population in the world.
(Gulf Business, July 2010) left me The ascription of Arab Women to
rather contemplative of Arnaud the ‘Lehman Sisters’ – with a longer-
Leclercq’s knowledge of the term view – should, methinks, be
demographic profile of the Middle geared towards the security of
East. Quoting Leclercq, Head of their kids and the future, and hence
Swiss private banking behemoth, more focused towards healthcare
Lombard Odier, in his presentation for the young as well as renewable
to the Dubai Chamber of Commerce energy that Arnaud and his peers
on the role of women to preserve at Lombard seem to be shying
and transmit wealth, it was clear away from.
that Middle Eastern women had a Dr. Nnamdi O. Madichie
penchant for the longer-term view University of Sharjah
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THE BRIEFING THE REGION
30
Seconds to
make sense of…
broadband
Farid Faraidooni
Chief Commercial Officer, du
How does broadband in UAE compare to EU and US?
We offer our customers the best value for money broadband
across the region and we are now more favourable than some
developed markets such as Ireland and Canada. Unlike some
operators across the world, that provide a cap on customer
usage, our offering is simple, with no usage limitation.
Why has the Middle East lagged globally in connectivity?
It wouldn’t be right to say the Middle East has been laggards
in terms of internet connectivity. However, the benefit of full
competition across all major telecommunications services
is a significant and welcomed milestone for the UAE.
Households right across the nation will soon start to enjoy
improved quality fixed line services, including broadband at
higher speeds, innovative TV and entertainment packages.
What is the penetration rate of broadband in the UAE?
A recent report published by the TRA listed the broadband
penetration in the country at 13.2 per cent. Using the ITU
assumption of 2.5 users per subscription, the penetration is
around 33.1 per cent. In the UAE, the take-up of broadband
is now twice as high as it was only two years ago.
How far off is a 4G network in the UAE?
We are actually well advanced with our rollout of the latest
commercial Mobile Technology (HSDPA) and our mobile
network is already providing connectivity at 21mpbs. At
this stage there is no committed date for the launch of 4G
network technology by the operators in the UAE.
When will business tariffs and caps be revised?
Faster, more cost effective and unlimited business grade
broadband for business customers will be available from
August 2010. Existing business customers will be upgraded
by up to eight times the speed of their current connection,
for no extra charge. Existing customers will be able to
migrate to ‘uncapped’ services.
OFF THE CHARTS
Forecasts for UAE internet and broadband users
4000
Number of
3000
internet users (000)
2000 Number of
broadband internet
1000 subscribers (000)
0 Source: Business
2009 2010 2011 2012 2013 Monitor International
26 gulfbusiness.com August 2010
[ GCC ]
Airshow takes big orders
Emirates has placed an order with Boeing for an additional
30 777-300ER aircraft, worth approximately $9.1 billion,
while attending the UK’s Farnborough airshow. This order
adds to the fleet of 71 777-300ERs previously ordered, of
which 53 aircraft are currently in service.
Emirates has 86 777s in service – three 200s, six 200ERs,
10 200LRs, 12 300s, 53 300ERs and two freighters.
In addition to the Farnborough deal, Emirates has orders
for 79 Airbus A380s, 70 Airbus A350s and seven Boeing
freighters, totalling 204 wide-body aircraft worth more
than $67 billion (Dhs246 billion).
During the Farnborough airshow, Emirates also selected
Engine Alliance GP7200 engines to power its A380 order.
F
The deal includes a $4.8 billion Fleet Management
Agreement for the engine maintenance, overhaul and repair.
While at Farnborough, Air Arabia selected the CFM56-
5B engine to power its 44 Airbus A320 aircraft order
announced in 2007. This deal, valued at more than $620
million, will more than double the airlines CFM56-5B
powered A320 fleet. Air Arabia also signed a multi-year
Rate per Flight Hour (RPFH) service agreement for its
CFM56-5B fleet.
Also present at Farnborough was Etihad Airways,
celebrating the handover of its first Airbus A330-200.
Etihad is the launch customer of the A330-200 freighter
aircraft, which will enter the cargo business, Etihad
Crystal Cargo, in September. It will allow the airline’s cargo
business to increase frequencies and build its presence in
the high-growth European and Asian freight markets, in
particular China.
Etihad will take delivery of its second A330-200 freighter
aircraft in September, which will enter service by October,
taking the airline’s fleet number to 56 aircraft.
Farnborough also welcomed Qatar Airways, which placed
orders for two additional Boeing 777-200 Long Range aircraft
as part of its continued growth plans. The order is valued at
$501 million.
The Doha-based airline also revised the delivery schedule
of its Boeing 787 Dreamliners, with the first to arrive
from the fourth quarter of 2011 to help meet early aircraft
requirements.
Qatar Airways now has firm orders for 10 Boeing 777s and
a further three on option with the US aircraft manufacturer.

■ East and Africa region. In
■
■ Currently only about
■
[ UAE ]
Passenger traffic
up 11.7 per cent
Abu Dhabi International
Airport’s traffic figures,
released by the Abu Dhabi
Airports Company (ADAC),
for the first six months
of 2010, showed a strong
increase of 11.7 per cent
in passenger traffic, when
compared to the same
period last year.
The recent traffic report
reflected a growth in
cargo performance, with
loads increasing by 20.3
per cent and aircraft
movements increasing by
11.9 per cent for the first
six months of 2010.
[ SAUDI ARABIA ]
SBG in first short-
term Sukuk deal
The Saudi BinLadin
Group (SBG) issued a SAR
700million ($187 million)
Sukuk Al-Murabaha, to
Saudi investors on July 12,
2010. This was the first
short-term issuance in
Saudi Arabia, and it was
over subscribed by more
than 2.5 times.
It has achieved several
notable firsts, including
first short-term issuance
in Saudi Arabia; first
■ megawatts of installed
■ energy council has approved
credit enhanced structure
incorporating the sharing
of assigned government
contract payment and first
issuance to be issued on a
zero coupon, discount to
maturity basis.
[ EGYPT ]
Profits blow in for
El Sewedy
Egypt’s El Sewedy Electric
Company sees plenty
of opportunities in the
renewable energy space
and expects its two-year
old wind division to turn a
profit by 2011. The demand
for wind energy is expected
THE BRIEFING THE REGION
to come from the Middle
particular, countries like
Syria, Jordan, Tunisia and
Morocco are developing a
big appetite for wind energy.
1.3 per cent of the 22,580
power capacity in Egypt is
from wind, but the supreme
plans to increase renewable
energy to 20 per cent of total
capacity by 2020, with 12
per cent wind powered.
[ SAUDI ARABIA ]
Saudi Arabia
capitalises IPO
PricewaterhouseCoopers
(PwC), has found that
initial public offering (IPO)
activity in Saudi Arabia
is leading regional IPO
activity in the first half
of 2010, with seven of the
eight taking place in Saudi.
Although the number
of IPOs was up slightly
on 2009, the total amount
raised was $830 million,
31.4 per cent lower. The
largest IPO in 2010, as of
June 30, was for Knowledge
Economic City Company,
which raised $272 million,
the equivalent of 32.7 per
cent of total GCC capital.
[ SAUDI ARABIA ]
Big development
investment
Saudi Arabia’s finance
ministry has approved
1,420 contracts for various
projects, valued at SAR71.5
billion ($19.1 billion) during
August 2010 gulfbusiness.com
the first half of 2010.
Saudi Arabia has drawn
on its reserves to fund
record budgets and keep
its $400 billion, five-year
infrastructure development
programme on track.
[BAHRAIN]
Bermuda eases
GCC business
The President and CEO of
Bermuda’s Stock Exchange
is convinced that Bahrain
offers Bermuda’s financial
community a remarkable
opportunity to develop
commercial relationships
thoroughout the GCC.
Greg Wojciechowski said
there were many areas of
growth to be pursued in
Bahrain, which has recently
signed a Double Taxation
Agreement with Bermuda in
Washington in April.
[ JORDAN ]
Record growth
leads expansion
Passenger traffic at the
Queen Alia International
Airport (QAIA), Jordan,
for the first half of this
year reached 2,445,500
passengers, which
translates to a 17 per cent
increase over 2009.
Aircraft movements for
the first six months were
strong; totalling 29,600
aircraft – an 11.3 per cent
increase over the previous
year. In addition to that,
Cargo registered 42,850
tonnes year-to-date with a
9.9 per cent increase over
the same period last year,
according to the Airport
International Group (AIG).
The $750 million
rehabilitation and
expansion works at QAIA
are underway, including the
construction of a new state-
of-the-art 100,000 square
metre passenger terminal.
27
THE BRIEFING THE REGION
[ SOCIOECONOMICS ]
Northern emirate
to boost economy
The Ras Al Khaimah
Government has achieved
significant success in
its efforts to launch
socioeconomic programmes
that promote economic
sustainability, enhance the
quality of life, and preserve
the emirate’s abundant natural
and archaeological attractions.
The Crown Prince and
Deputy Ruler of Ras Al
Khaimah, HH Sheikh Saud
Bin Saqr Al Qasimi, has been
widely recognised as the
architect of the emirate’s new
direction towards a more
diversified economy. Under
his leadership, the emirate’s
GDP, which now stands at
$4.30 billion, achieved a
remarkable average growth
of 14 per cent per year from
2004 to 2008, and nine per
cent in 2009.
One of the key initiatives
undertaken by HH Sheikh
Saud was to invite the
World Bank to make a
series of studies on how
to make Ras Al Khaimah
a business-friendly and
efficient investment
destination, which resulted
in the establishment of
manufacturing, tourism,
real estate, construction
and services as key growth
sectors of the local economy.
In the last two years,
Ras Al Khaimah has also
achieved “A” ratings from S&P
and Fitch, primarily through
HH Sheikh Saud’s efforts
to consolidate the RAK
Government’s balance sheet.
28gulfbusiness.com August 2010
[ STOCK MARKETS ]
Aabar revises price of delist
Aabar Investments is
attempting to delist itself
from the stock market by
buying out its minority
shareholders, but the
company came under fire
from the market regulators
over the share price it
offered, which was well
below the going rate.
In its bid to delist from
the Abu Dhabi Securities
Exchange, Aabar initially
offered a price of Dhs1.45
($0.39) a share, but it was
ordered by the Emirates
Securities and Commodities
Authority (SCA) to raise its
offer to Dhs1.95 ($0.53).
If the company is now
successful it will be the
first local company to delist
from the Abu Dhabi bourse.
Once delisted, Aabar will be
under no obligation to release
financial information, as a
private joint stock company,
and it will no longer be the
region’s most transparent
sovereign wealth fund.
[ BUSINESS ]
Ladies upbeat about recovery
A recent survey by the Heels
& Deals network gives an
insight into how female
entrepreneurs in the UAE
have survived the economic
downturn so far and how
they feel 2010 is shaping up.
The survey also found
respondents are feeling
more positive about this
year, with 84 per cent of
women saying 2010 will be
more profitable for their
business than 2009.
To survive through the
downturn, 13.8 per cent of
women said they’d had to
downsize their operations,
but 25 per cent reported
they had raised additional
capital to see them through
With no shareholders
to account to and no
financial information to
disclose, analysts believe
the company will have more
room to manoeuvre.
Aabar said the offer
period for buyback was
valid until August 5, but it
was not made clear what
would happen if minor
F has appointed. Financial
shareholders reject the deal
as the firm is majority-owned
by Abu Dhabi’s International
Petroleum Investment
Corporation (IPIC), which
holds 71 per cent, and
supports the delisting.
the turbulent times.Women
attributed their success at
staying afloat to negotiating
better payment terms with
suppliers to help cash flow,
or to maintaining the focus
on making their offer more
attractive to customers. Of
those surveyed, 38.8 per
cent said they had reduced
their pricing and 44.4 per
cent had introduced special
offers to entice customers.
“It’s encouraging to
hear that the majority
of the entrepreneurs
surveyed are positive that
their businesses will fare
better in 2010 than last
year,” commented fellow
co-founder Claire Fenner.
The stock will be fully
suspended on August 8,
the date when its majority
shareholder IPIC purchases
all shares tendered during
the offer period.
IPIC will purchase
the tendered shares
through the brokers it
settlement will be effective
on August 10, when shares
of Aabar will be registered
in the name of IPIC.
On the back of the
proposal, Aabar stock
soared on the ADX by 9.88
per cent to dhs1.89 a share.
“There have been many
lessons learnt from the recent
challenges and the downturn
has forced many of our
members to trim the fat from
their businesses and to focus
on developing a long-term
sustainable business model.
We’re not being so short-
sighted to think there aren’t
more challenges ahead; in
fact, respondents said their
biggest challenge for 2010
was receiving outstanding
debt from clients, but if the
UAE’s entrepreneurs and the
wider business community
come together to support
one-another and share
insights, the recovery will be
much quicker.”

[ POLITICS ]
BP deal linked to early release of Lockerbie bomber
Libya’s top oil official has
rejected suggestions that
a $900 million oil deal
awarded to BP in 2007 was
linked to the release of
convicted Lockerbie bomber
Abdel Baset Al Megrahi.
“I was leading the
negotiations and BP
was awarded the deal
because it offered the
best proposal compared
to its competitors,” Shokri
Ghanem, chairman of Libya’s
National Oil Corp (NOC).
BP won the Libyan
exploration and
production contract and
signed the deal in May
2007. The deal, worth at
least $900 million, was
for the onshore Ghadames
and offshore Sirt areas,
covering an exploration
area of around 54,000
square kilometres.
Ghanem’s comments
come as four US senators
from New York and
New Jersey, seeking an
investigation into Al
Megrahi’s release from
prison last year, are calling
on BP to suspend its oil
drilling plans in Libya
THE BRIEFING THE REGION
until it can be determined
whether the oil giant played
any role in his release in
exchange for a contract.
Meanwhile, BP is to sell
assets in Texas, Canada
and Egypt, to part-fund the
clean-up cost of the Gulf of
Mexico oil spill.
A $7 billion deal has been
reached with US-based oil
production firm Apache Corp.
August 2010 gulfbusiness.com
The company said the
assets sold included oil
fields and gas processing
plants in Texas and
south-east New Mexico
worth $3.1 billion and
BP’s upstream Western
Canadian gas business for
$3.25 billion, along with oil
exploration and production
assets in Egypt worth
about $650 million.
BP’s share of the Prudhoe
Bay oil field in Alaska was
not included in the sale to
Apache, contrary to earlier
media speculation.
BP has now capped the well
but there are mounting fears
that the cap must be removed
as the pressure continues to
drop and leaks are appearing
around the well.
29
THE BRIEFING THE REGION
[ BANKING ]
Non-residents get
mortgage facility
Standard Chartered Bank
has launched a unique new
mortgage facility which
offers non UAE residents a
customised approach to avail
loans of up to $5 million.
The mortgage process
has been made easier as a
result of the bank having
developed two UAE first-in-
market assessment criteria
specifically tailored to this
affluent and high net
worth sector.
Customer-based research
highlighted that the affluent
and high net worth market
did not have access to a
mortgage offering that met
with their needs. Standard
Chartered Bank is the only
financial institution in
the market offering such a
high loan amount to non-
residents. The facility is
available on either new or
existing properties providing
they were built by one of the
Bank’s registered developers.
David Inglesfield,
Regional Head of Private
Banking-Middle East
& North Africa, said:
“We have shifted from a
product focus to being
more customer focused and
as a result we have been
developing better service
and product packages based
around our customers’
needs rather than adopting
a one size fits all approach.
“Through this strategy,
we have built up great
momentum and are
maintaining this growth by
continuing to invest in our
business and through the
development of products
like this one.”
30gulfbusiness.com August 2010
[ TOURISM ]
Duty free sales take off
Dubai Duty Free has
retained its position as the
single largest airport retail
operation in the world,
based on 2009 sales of $1.14
billion and analysis released
by Generation Research.
For the second year
running, the announcement
places Dubai Duty Free
ahead of London Heathrow,
while Seoul Incheon
International Airport
retained the third position.
HH Sheikh Ahmed
bin Saeed Al Maktoum,
President of Dubai Civil
Aviation Authority and
Chairman of Dubai Duty
Free, commented: “Given
that 2009 was a difficult
[ FINANCE ]
Private equity grips Middle East
Insead has partnered with
Booz & Company to issue
a report entitled Private
Equity in the Middle East:
A Rising Contender in
Emerging Markets.
The report examines how
the industry has evolved
over the years deeply
impacting the region’s
economic development,
as well as its current
challenges and outlook.
Insead and Booz &
[ NETWORKING ]
Internet highway links EU and Middle East
Six of the region’s leading
operators have signed an
agreement to build the RCN
(Regional Cable Network)
– a multi-terabit cable
system stretching from the
UAE through Saudi Arabia,
Jordan, Syria and Europe.
RCN will provide robust
bandwidth connectivity
for the region’s growing
year for the airport retail
industry across the board,
it is significant that Dubai
Duty Free retained its
number one position.”
In 2009, with the world’s
recession at its peak, the
global duty free and travel
retail business witnessed a
F
Company surveyed private
equity firms or general
partners (GPs), and their
investors or limited
partners (LPs) in the Middle
East to create the report.
Respondents were surveyed
for their views on the
business, current market
sentiment, confidence and
expectations.
Insead’s Dean Frank
Brown, said: “As private
equity develops as a sector
broadband community. It
will also provide greater
diversity for each of the
operators and protect their
service from disruption
from damage to undersea
cable systems.
Etisalat (UAE), Mobily
(Saudi Arabia), Jordan
Telecom (Jordan), Zain –
Mada coalition (Jordan)
6.8 per cent decline in sales
to $34.5 billion.
However, duty free and
travel retail business in
the Middle East bucked the
trend and rose by three per
cent to $2.5 billion, which
represents 7.2 per cent of
global sales.
it will be a key feature in
the landscape of economic
recovery. It will continue
to be a critical focus for
our faculty research and
programmes.”
The private equity
industry in the Middle
East has grown remarkably
quickly for an industry that
barely existed a decade ago.
Today, there are some 150
funds in the region with a
further 10 announced.
and Syrian Telecom
(Syria) together with other
European partners have
joined forces to build
the mammoth 4,000km
diversified cable system
which will provide reliable
telecommunication and
internet connectivity for all
users in those countries and
the surrounding nations.

[ ECONOMY ]
Low oil prices pose major risk to GCC – IMF
The single biggest threat
to the economies of the
Gulf Cooperation Council,
or GCC, region remains a
protracted period of low
oil prices arising from a
sluggish global recovery,
according to economists at
the International Monetary
Fund (IMF). Countries in the
GCC have taken important
steps to address the fallout
from the global financial
crisis with significant
progress having been
achieved in restructuring
the debts of Dubai World,
the Dubai government-
owned conglomerate, as well
as the restructuring of some
of the largest investment
[ OIL & GAS ]
Iraq boosts domestic refineries
The Iraqi oil ministry
is talking to several
international oil companies
about investment in
four planned refineries
throughout Iraq to meet
increasing domestic
demand, the country’s
deputy oil minister has said.
“The estimated cost of
these four new refineries,
that are designed to
produce some 740,000
barrels a day of refining
[ SHIPPING ]
Foreign ships threaten to boycott Saudi ports
Owners of foreign ships
have threatened to boycott
Saudi ports and use other
Gulf ports if the current
crisis in unloading cargo at
Dammam’s King Abdul Aziz
Port continues unabated.
The ship owners said
some ships have had to
wait up to three weeks,
and in some cases an
companies’ debt in Kuwait,
the economists wrote in
a paper prepared by the
Middle East and Central
Asia department of the IMF.
“The short-term priority
remains the buttressing of
the financial sector without
unduly constraining the
availability of credit,” they
added. Economic growth
in the GCC is projected
to strengthen in 2010,
supported by strong fiscal
spending and the global
recovery. Non-oil growth
is expected to strengthen
to about 4.3 per cent,
supported by fiscal stimulus
in Saudi Arabia, the UAE
and more recently Kuwait.
capacity, is more than
$20 billion,” Ahmad
al-Shammaa told Dow
Jones Newswires.
Shammaa said Iraq’s
first priority refinery is in
Kerbala, south of Baghdad,
with a production capacity
of 140,000 barrels a day
and an estimated cost of $4
billion. The second priority
is to build a refinery in
Missan in southern Iraq
with a capacity of another
entire month, to unload
cargo, something they say
is resulting in huge costs.
They, along with shipping
agents and businessmen,
have called on Minister
of Transport Jabara
Al-Seraisry, who is also
chairman of the General
Ports Authority, to intervene
and resolve the crisis.
THE BRIEFING THE REGION
The IMF economists
said fiscal stimulus in the
GCC has been successful
in dampening the impact
of the global crisis on non-
oil growth, but countries
should prepare an exit
strategy from current
high spending levels, to
ensure long-term fiscal
sustainability, which would
need to be implemented
once conditions allow.
Countries in the GCC
should also improve
the governance of state-
related enterprises, with
greater attention given
to transparency and
management of leverage and
balance sheet risks.
150,000 barrels a day,
US companies Shaw
Group Inc, along with
Stone & Webster Inc, are
designing the refinery and
they are expected to finish
the front-end engineering
design next year. It will cost
around $4 billion.
Iraq also plans to build
the Nassiriya refinery, near
the city of Nassiriya in the
south, to process 300,000
barrels a day.
The ship owners are
blaming companies engaged
in unloading sea cargo for
the current stalemate. Most
companies at the port are
facing labour shortages and
have been unable to deal
with the sudden increase
in workload due to the
summer and upcoming
Holy Month of Ramadan.
August 2010 gulfbusiness.com
[ OIL & GAS ]
Bahrain oil
production leaps
The Kingdom’s oil
production is expected
to increase 81.8 per cent
between 2010 and 2019, with
crude volumes doubling to
100,000 barrels per day.
Oil consumption between
2010 and 2019 is also set
to increase by 30.5 per
cent, with growth at an
assumed three per cent per
annum towards the end of
the period and the country
using 57,000 barrels per day
(bpd) by 2019, according to
Bahrain Oil and Gas Report
Q3 2010, a new market
report by companies and
markets.com.
Bahrain’s real GDP is
assumed to have fallen
by 0.1 per cent in 2009,
followed by a forecast of 1.4
per cent growth in 2010.
[ BANKING ]
Damas extends
debt standstill
Damas, the Gulf region’s
largest jewellery retailer,
has signed an extension
of a standstill agreement
it has in place with the
majority of its bank lenders
until September 30 as it
works to restructure about
$872 million in debt.
“The standstill agreement
has been extended until
September 30, 2010 in
accordance with its
terms in order to allow
the company to finalise
its restructuring plan
and having regard to
the Ramadan period,”
the company said in a
statement posted on the
NasdaqDubai Web site.
Damas said that it has
agreed a term sheet with
the steering committee of
its bank lenders which has
now been sent to the entire
lender group for approval.
31
THE BRIEFING LOGISTICS

Take-off for pharma distribution

Business got off the ground last month at the world’s largest airport complex, as the first tenant
set up shop, reports MICHAEL GORDON.

D
ubai World Central (DWC) is
one of the most ambitious
projects of its kind in the
world. This ‘aerotropolis’
comprises the new Al Maktoum
International airport, set to be the
world’s largest in volume and
size upon completion, and the
adjacent specialised free zones
focused on fast-cycle logistics and
aviation industries.
DWC will occupy an area of 140
square kilometres in Jebel Ali, next to
the UAE’s largest free zones (JAFZA)
and the Jebel Ali Sea Port, the sixth
largest container terminal in the world.
In addition to a dedicated link to the
sea port, DWC’s unique multimodal
capabilities are supported by links to
all main motorways in the country, the
upcoming GCC high speed rail network
and the Al Maktoum International
Airport, which once complete will
Logistics is regarded as a crucial part of
handle up to 120 million passengers the pharmaceutical industry since the
and 12 million tonnes of air cargo per
year. Phase 1 of DWC is now fully
cargo is easily perishable.
completed and became operational as
of June 27, 2010. across India). Logistics is regarded as time for companies based in DWC
The DWC is part of the Dubai a crucial part of the pharmaceutical by creating seamless connections
Government’s overall 2015 strategy to industry since the cargo is easily between Jebel Ali Sea Port, JAFZA,
enhance the emirate’s transport and perishable. As a result, the activities DWC and Al Maktoum International.
logistics services and capitalise on its are highly time sensitive, and the These services will allow Hellman
geographical location to make Dubai a products require temperature- Calipar to provide its customers
regional hub for logistics. controlled storage and distribution. with end-to-end supply chain
Over 30 leading international Jost Hellmann, co-owner Hellmann solutions, including supply chain
companies have already committed Worldwide, explains: “Pharmaceutical design, research and development,
to establish a base in DWC, with and healthcare logistics, as a concept, manufacturing, transport and
growing interest from a number of deals with susceptible and time distribution. The site also benefits
multinational companies. sensitive products that need to be from 300 air destinations, 125 shipping
As one of the pioneers, Hellmann carried through the supply chain in a lanes and a Gulf-wide road network.
Calipar will run an international controlled manner. Michael Canon, chief commercial
pharmaceutical distribution operation “As such, it needs to be supported officer, Dubai World Central, says:
from DWC. The operator is a joint by a highly efficient logistics “Today, airports are building cities
venture between Hellmann Worldwide environment that allows fast-cycle and we have a unique position here
Logistics of Germany (which has a transit, high-quality technological as this airport sits on a Greenfield
turnover of $4.3 billion and more than infrastructure and global connectivity site. There are no competing interests
400 offices in 150 countries worldwide), through a fast, multimodal to use the land, which will allow us
and Calipar Integrated Services, part of transportation network.” to grow to become a true multi-modal
the Parekh Group of India (which has The creation of the Dubai Logistics logistics platform.
200 warehouse locations in 42 cities Corridor will shorten the transit “What DWC is trying to do is to

32 gulfbusiness.com August 2010


provide a seamless multi modal
logistics platform in terms of
regulatory reform, which will allow
the likes of Hellmann Calipar to
provide a predictable service.
“In order to have that platform
we need stakeholder alignment
because the platform is built on
the hard and soft infrastructure.
The hard infrastructure is the
airport, the roads, the port and soon
the Union railway connecting all
modes. The soft infrastructure is
the regulatory bodies, the rules and
regulations, systems in terms of IT,
telecommunications, customs and the
ministry of health.”
In theory, this infrastructure
allows DWC to facilitate fast cycle
logistics. But the hard and soft
infrastructure needs to be operated
properly and be predictable over
time, because companies like
Hellman Calipar need to know
exactly what steps they have to go
through and what regulatory bodies
they must deal with to make their
business work.
THE BRIEFING LOGISTICS
DWC says it is trying to work with
various stakeholders in Dubai, in the
UAE and the Middle East to provide a
logistics platform that is seamless in
regulatory control.
So far, 18 cargo operators have
signed up with DWC to establish
operations before October. However,
Canon is not yet mollified, he says:
“18 is still not adequate – we need
the frequency of flights as well
as destinations.”
Yet Rajiv Merchant, director and
board member, Hellmann Calipar
Healthcare Logistics, believes that
the company will be able to reach its
goal of 60 per cent utilisation by the
end of this year. This equates to 9,000
pallet positions.
Once the success of the Dubai
operation is proven, Merchant says
that the joint venture will invest in
further satellite sites throughout the
MENA region.
So far the joint venture has
signed up to distribute the drugs
of four pharmaceutical producers,
including Actavis of Iceland and
three regional players. Merchant
says that the majority of interest is
coming from the West, regarded as
a well established pharmaceutical
producing region, supported by
a sizeable amount of interest in
India, which is a rapidly growing
pharmaceutical market.
Dnata Cargo, which is already
the ground handler for more than
120 airlines at Dubai International
Airport, has announced it will
provide the ground handling services
to all airlines at the Al Maktoum
International Airport.
Dnata Cargo has the facilities and
capability to handle any type of cargo
even perishable goods – as it has
access to 1,000 cubic metres of chiller
and freezer storage.
In conclusion, Jost Hellmann
stresses that although it is very early
days for DWC and the Hellmann
Calipar joint venture, he is very hopeful
about its success. He says: “We share
the vision of DWC, and we believe in it,
to make Dubai the logistics hub of the
world.” ■ gb@motivate.ae
August 2010 gulfbusiness.com 33
THE BRIEFING HOSPITALITY
Catering to the crescent
Following on the success of Shari’ah-compliant finance and the booming halal food industry, a
Singapore-based company is now bringing the ‘Muslim effect’ to hospitality, ZARINA KHAN reports.
H
otels across the world can now
be ranked according to how
‘Muslim-friendly’ they are,
following the global launch of
a halal-focussed hotel rating system.
Crescentrating.com, a Singapore-
based online ratings company,
recently brought its voluntary
ratings system to the Gulf to give
hotels here the option of appealing
to the halal-conscious consumer
who today wants more than verbal
assurances and unverified claims.
“Of the some $944 billion in
international tourism receipts in
2009, it can be estimated that six to
seven per cent was from the halal-
conscious market. Considering that
the international market will reach $1
trillion in the near future and the halal
segment is going to grow to around
10 per cent, you have a potential
halal-conscious travel market of $100
billion. What business can afford
to ignore that potential revenue?”
Crescentrating chief executive officer
Fazal Bahardeen told Gulf Business.
Bahardeen believes that following
the massive global success of Shari’ah-
compliant finance and the organised
halal food industry, Muslims – who
number a significant percentage of the
global population – are becoming more
aware of their rights as consumers to
ask for foods and facilities that are in
line with their values.
“If you look at the world halal food
market, it’s something like 16 per cent
of the global food market. Currently, the
Muslim population globally is about 24
per cent, and it will reach 30 per cent in
a few years. Food and banking for the
Muslim consumer has already taken off
– travel is following,” he added.
To provide the halal-conscious
consumer a hotel experience that
accommodates and even complements
their values, Crescentrating offers
a service that rates a hotel in five
areas – prayer facilities, halal food
34 gulfbusiness.com August 2010
services, guest bathroom facilities,
Ramadan facilities, avoidance of non-
halal activities and Muslim-friendly
recreation facilities and services.
The Muslim market segment is very
strong in terms of spending power but
many businesses are not aware of it.
“With a rating of 1 being the lowest
and 7 being the highest, our criteria
for rating includes halal food, prayer
direction in rooms and non-serving of
alcohol, among other ratings,” he added.
“The Muslim market segment is very
strong in terms of spending power
but many businesses are not aware of
it. US Muslims’ buying power is over
$190 billion. In the UK it is about 26
billion pounds. There has been some
negativity directed towards marketing
to the Muslim world but that shouldn’t
be the case,” Bahardeen explained.
The negativity is changing. Since
its October launch, Crescentrating
has seen massive interest and today
ranks over 100 hotels worldwide, with
another 50 in the Gulf alone reportedly
in talks to join the rankings.
Hotels that wish to be included on
Crescentrating’s approved list must first
self-audit against the company’s criteria,
which is later verified by an independent
inspection from Crescentrating.
“Because of the credibility we want
with the consumer, we have to have a
direct relationship with the hotel. The
hotel fills out our forms and agrees to
our terms and conditions to provide
access to us to verify their rating,” the
CEO explained.
Halal-conscious customers then
have free access to Crescentrating’s
list of rated hotels upon which to base
their travel plans.
The idea came to Bahardeen
from his own difficulties as a halal-
conscious traveller. “Before launching
Crescentrating, I spent 20 years in
French companies and for the last 10
years I spent 25 per cent of my time in
hotels. I’ve had those frustrations that
Muslim travellers have – where is the
prayer direction, what can I eat, etc.”
Bahardeen recognised what he
believes is a huge underserved market,
and left his career to launch the online
ratings system. Since its 2009 launch,
it has been expanded to cover other
sectors, including halal-friendly
guides to airports and a halal
restaurant directory. The company will
also soon be rating amusement parks
as well. gb@motivate.ae
THE BRIEFING FOOD IMPORTS

Fleshed out
For 30 years meat-exporting Australia and the meat-loving Middle East have enjoyed a
comfortable relationship, which is now being put to the test. ZARINA KHAN reports.

T
he seasoned relationship
between Australia’s meat
exporters and the Gulf’s
meat-lovers, which has
been developed over the past three
decades, has been going through some
tough times lately due to currency
fluctuations and supply issues.
“The volatile exchange rates and the
pricing from our competitor markets,
plus undersupply of our product, are
the challenges we face,” explained
Lachlan Bowtell, regional manager
Middle East & Africa with Meat and
Livestock Australia (MLA).
Asian currencies are pegged to the
American dollar, while the Australian
currency is not, so fluctuations in
the dollar value have been to the
benefit of Asian competitor exporters
and to the detriment of Australia’s
cost-competitiveness. “Prices of our
products have gone up due to volatility
and lack of supplies,” Bowtell added.
On the supply side, while Australia
is one of the region’s primary sources
of red meat and livestock imports,
demand for mutton has recently
outstripped available Australian
supplies. Farmers down under have
been struggling to keep up with the
region’s increasing demand for mutton,
which lead to a 8.7 per cent drop in
their Middle East exports in 2009.
The Middle East, and the Gulf in
particular, is heavily dependent on food
imports – a fact vividly brought to light
during April’s volcanic ash disruptions,
where local media reported super
market shelves going sparse without the
daily imports of tens of thousands of
kilograms of produce from Europe and
North America. The Gulf Cooperation
Council’s (GCC) annual food imports are
expected to reach $53 billion in 2020.
Australia has seen steady growth
in its Middle East exports. General
shipments to the Middle East in
2009 totalled a record 15,752 tonnes,
up 21 per cent in 2008.
The Middle East was the largest
growth market for Australian lamb
during the period, taking 35,871
tonnes to be 41 per cent higher than
the previous year. The strong results
follow similar growth in the previous
years. For the financial year 2007-
2008, Australia’s lamb sales increased
18 per cent from 20,122 million tonnes
to 23,743 million tonnes and beef
increased 130 per cent from 3,356
million tonnes to 7,718 million tonnes.
The Middle East, which extends
beyond the GCC to include the Levant
We are not concerned with
undercutting. Our food safety
is our priority.
and North Africa, is not surprisingly
Australia’s largest live sheep and sheep
meat destination – which explains why
farmers in sleepy towns down under are
well versed in halal requirements and
know what cut of meat works best for
the Arabian mashawi grill.
“Our farmers now specialise
in breeding the specific product
preferred for this market,” the MLA
official said.
Bowtell and his colleagues in
Australia’s meat industry, however,
believe that despite the recession,
and the ups and downs of the global
economy, the Middle East will always
maintain its link to their farms.
“Because of the fact that 55 per
cent of Australia’s meat produced is
exported, we take that industry and
its standards really seriously. That is
why Australia has never been locked
down because of food safety concerns.
And for us, halal certifications are not
voluntary, they are a requirement,” the
MLA manager told Gulf Business.
“We are not concerned with
undercutting. Our food safety is our
priority. We cannot be the cheapest in
the market because of our standards.
We are very focussed on high-quality,
safe, red meat products. Our goal is
to maintain and defend our portion of
the market,” a fact which he believes
will continue to earn the Middle
Eastern consumer’s trust and loyalty.
The Gulf region’s growing
population means that demand will
continue to grow, and Australian
farmers believe Middle Eastern
consumers’ preference for quality
produce means they will continue to
find their lamb, beef and mutton in
good demand. gb@motivate.ae

36 gulfbusiness.com August 2010

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THE BRIEFING JAGUAR

Jag is cat’s whiskers at 75

As an icon of British motoring, Jaguar the brand had become a little staid, but thanks to a design
team change, new life has been breathed into the elegant beast, as MICHAEL GORDON discovered.

F
ar from retiring, the 75-year-
old British car manufacturer
Jaguar is finding a new lease
of life.
The company has just launched
the latest in its series of new ‘design
language’ sports cars, and according
to Robin Colgan, the managing
director for Jaguar Land Rover Middle
East and North Africa, the XJ will be
the best car Jaguar has ever built.
The company has also rejoined the
racing circuit, where historically it has
had countless successes, but we will
come back to this later.
Speaking about the model launch,
Colgan says: “This new ‘design
language’ started with a desire to
make beautiful cars. the best ‘infotainment’, everything you US, Germany and Italy. To cater to
“We have some very talented interact with is state-of-the-art. this market, Jaguar runs a full-scale
designers and when the hugely Most of the XJ’s body is made of technical support operation in Dubai,
talented Ed Callum joined us he was aluminium, which means you drop with 30 staff to provide support to
given a once-in-a-lifetime opportunity; 200kg, making it lighter than any workshops. It also carries out all of its
to develop the latest generation of cars other vehicle in its class, and with a hot weather testing in Dubai.
for a venerable brand like Jaguar.” 5-litre v8 engine delivering 510 bhp, As a demonstration of the
He adds: “This team simply drew cars the powertrain is as good as it gets. company’s commitment to the region,
they thought were beautiful. We were Colgan adds: “The XJ outshines the the director of engineering, Bob
not looking to pastiche the designs of XF by a factor of 10. We believe it will Joyse, who is the board member
the past. But if you scan back through
Jaguar designs they were always sporty.
Especially the original XJ, which was a
Our current distribution network
very quick and sporty saloon.” throughout this region is the envy of
In fact, Jaguar’s sporting credentials
have been established since the
many manufacturers.
beginning of the brand. “The words
our designers had to triangulate be one of the best, if not the best, car responsible for the entire engineering
were sporting, contemporary and in its class.” organisation, comes out to Dubai
luxurious,” adds Colgan. Colgan and his team are particularly three to four times a year to meet with
In 2007, the first of the new breed, the excited about the launch of the XJ customers and importers.
XK, was launched, followed by the XF because of the unique nature of the Jaguar operates in Dubai in
in 2008. “When we launched the XF, to Middle East market. Everywhere else partnership with Al Tayer, a
replace the S-Type, we went from selling in the world the largest saloon is long-standing and well-established
around 600 units per year to selling outsold by the mid-range and the mid- UAE-based company. “For each market
1,200 units annually,” boasts Colgan. range out sold by the compact, but in we enter we have separate joint
“Every vehicle we have launched the Middle East the reverse is true and ventures, with Premiere Motors and
with the new ‘design language’ has bigger is better. So, as the king-size of Al Tayer as our partners in the UAE.
given us a huge boost in sales.” the fleet, the XJ could do very well. “All the way from North Africa to
The newly launched XJ is claimed to For Jaguar, the Middle East (which Pakistan, including the Levant and
be the best car Jaguar has ever built. covers the GCC and the Levant) is its the Gulf, we don’t do any distribution
With the best performance, design, and fifth largest market behind the UK, and retailing ourselves. This is

38 gulfbusiness.com August 2010


for two reasons – the first is that
we believe a local family, that is
established and understands the
local market, is more suited to local
distribution than we are. Secondly,
there is a legal framework often
75-YEAR-OLD BOY RACER
J aguar returned to the starting grid at
Le Mans on June 12, with the XKR
GT2 sports car lined up alongside the
world’s leading endurance racers for the
classic 24-hour event.
As Jaguar celebrates its 75th
anniversary of building and racing cars, it
is fitting that the British marque returns to
competition at the circuit where it earned
seven race wins between 1951 and 1990.
Mike O’Driscoll, managing director
of Jaguar Cars, says: “It’s good to be
back. We aim to make the Jaguar brand
synonymous with motorsports once again.”
During the 1950s, Jaguar’s founder Sir
William Lyons sought to prove his cars were
as fast and as strong as far more expensive
rivals, with legends such as Stirling Moss
and Mike Hawthorn behind the wheel of the
iconic C-type and D-type racers.
In 1951, the C-type won Le Mans at
imposed to ensure the partner is
a local company… but the key is
ensuring you have the right partner.
“Our current distribution network
throughout this region is the envy of
many manufacturers.”
its first attempt, with a further victory
in 1953. Its successor the D-type took
Le Mans wins in 1955, 1956 and 1957.
Technical innovations such as the
C-type’s disc brakes made their debut
on Jaguars at Le Mans, and were rapidly
adopted by car makers the world over.
After a two-decade absence, Jaguar
returned to France with a works team in
the late 1980s and once again took race
wins in 1988 and 1990 with the V12-
powered XJR.
Jointly developed by Jaguar’s
engineering and design groups and the
US-based RSR (Rocketsports Racing)
team, today’s racing contender is
the XKR GT2. This racer features the
road car’s lightweight aluminium body
structure and a tuned version of its 5.0-
litre supercharged V8 engine, developing
in excess of 500 bhp.
THE BRIEFING JAGUAR
The global financial crisis of 2008,
hit all manufacturers very hard. But the
Middle East market behaved differently
to the rest of Jaguar’s portfolio.
Conversely, the manufacturer had
a record 2008 right through until the
end of the year, then January 2009
was uncertain, but come February
there were no orders – the market just
stopped. “We witnessed the same in
China and neither markets recovered
until early 2010,” says Colgan.
He explains: “General buyer
confidence dropped and people dropped
out of their natural buying cycles.
Just as severe was the impact from
a lack of available credit. Relatively
few have the cash available to buy
a car or would spend it if they did,
preferring to take out loans instead.
“Thankfully, the willingness of
banks to loan has recovered quite
strongly today, and people are a lot
surer about their own security. Plus
nothing stimulates a market like a new
product, so we are hoping for success.”
When Tata bought Jaguar from Ford
back in 2008, there was a risk that
the new owner would come in and
look at the cycle plan going forward
and the investment required to keep
Jaguar viable and begin to make cuts.
“To cut down on the cycle plan and
production development plan would
have been disastrous – but thankfully
that never happened,” says Colgan.
He adds: “Development is our life
blood. If you take any company and
stop product development tomorrow
you may not notice anything for a few
years, but eventually you will hit a
wall and that is the company finished.
“Today, I can look at the lifecycle
plan for Jaguar and know I have a
strong plan and strong and relevant
product coming through now and for
the future.”
Colgan says that the best clue as
to where Jaguar is going is to look at
where it is now and what has been
done. “How our vehicles are evolving
demonstrates how forward-looking
and ambitious the company is. We are
looking for continuous growth,” he
adds. gb@motivate.ae
August 2010 gulfbusiness.com 39
THE BRIEFING ISLAMIC INSURANCE
Islamic finance and risk evasion
Political and credit risk insurance can dramatically improve the export capacity of the
poorest of nations, as MICHAEL GORDON discovered.
M
any producers in the Third
World face an uphill battle,
in that they can’t attract
buyers for their exports,
because of a lack of export credit, and
they can’t attract inward investment,
because of their country’s perceived
political risk or instability.
A well-heeled guarantor can often
resolve the situation, but when you
look at the vast international debts
many Third World countries owe, it is
clear this comes at a price.
Not so in the Islamic community.
The solution, it would seem, is The
Islamic Corporation for the Insurance
of Investment and Export Credit
(ICIEC), which offers export credit
and political risk insurance
to its 39-member Third World
countries, which are exclusively
members of the Organisation of
Islamic Countries (OIC).
Dr Abdel Rahan Taha, chief executive
officer, ICIEC, said: “We insure the
risk of export credits for our member
countries and we insure the political
risk associated with investments
coming into our member countries.
“We are essentially a multilateral
organisation in that we are owned by
39 sovereign states – similar to the
World Bank and different from normal
business corporations.”
While the ICIEC may be similar to
the World Bank, in many ways it is also
unique, such as being the only provider
of Shari’ah compatible insurance. This
means that whatever profit it makes is
reinvested into the company to allow it
to further stretch its cover.
The ICIEC is also unique in the
sense that it is part of the larger
Islamic Development Bank (IDB) group
– which is one of the main regional
financing organisations.
“Our business model is to support
exporters, in our member countries,
that export anywhere in the world.
We insure on the risk of the default
40 gulfbusiness.com August 2010
of the buyer. This enables exporters
to offer their buyers credit facilities.
It also allows them to finance their
export credits from the bank with the
security of our insurance policy.”
The insurance covers acts of war or
civil disturbances and even government
confiscation, but not acts of God.
The second element of the ICIEC
model is its medium-term business,
which is essentially project finance.
The ICIEC gives the banks the
necessary assurance to lend bridging
funds or credit facilities to ICIEC
members. “Our clients need the funds
to work on a project before they are
paid for that work, but the bank
will not loan without a guarantee or
security, which we provide.
“We insure the risk of non-payment
by the import-contracting client,”
explained Dr Taha. The banks are happy
to accept ICIEC as a guarantor because
“It is important to stress the role that
political and credit risk insurance can
play in advancing exports.
of the strength of the group’s financial
position as certified by its rating. The
ICIEC has an Aa3 with Moody’s, and
its parent company IDB is rated AAA.
“This gives the bank comfort, knowing
we can be trusted, and we have a track
record from being in business for over
15 years,” he added.
The third side of the ICIEC business
model is investment insurance, where
the group is committed to encouraging
the inflow of Foreign Direct Investment
(FDI) into its member countries. Dr Taha
explained: “Here, the risk we insure
is not commercial risk, instead we
insure the risk of the country, which the
investor is powerless to control.”
He added: “All our member countries
are very rich in resources, especially
in Africa, and they are very lucrative
business opportunities. However,
many of our countries are perceived
to be high risk and this impedes their
inflow of FDI.”
FDI flow records show that African
and Asian countries make the bulk of
ICIEC membership but they receive a
miniscule portion of total FDI, maybe
three to four per cent.
The country risk insurance ICIEC
offers covers three basic risks. First
is war and civil disturbance; second
is nationalisation, confiscation and
government interference; and third is a
restriction on foreign exchange transfer
or the inability to remove profits.
Despite the obvious benefits of
the ICIEC cover, the Middle East’s
insurance penetration rate is low
compared to OECD markets in
Europe and the US. It is even worse
when it comes to political and credit
risk insurance. Across the entire
Islamic world ICIEC provides
around $14 billion of credit risk
insurance, but internationally it
provides $1.3 trillion.
Currently the ICIEC is hampered by
the size of its capital base in relation
to the potential demand for its service.
With a capital fund of $250 million the
group can do a maximum of $3 billion
worth of business. This is clearly an
issue Dr Taha is impassioned by:
“It is important to stress the role that
political and credit risk insurance can
play in advancing exports. It enables
the exporter to enter new markets; it
enables him to expand his business with
existing clients and to provide them
with credit facilities. These are the main
tools for competing in international
markets.” gb@motivate.ae
 THE BRIEFING AVIATION

Terminal velocity
The Gulf is at the forefront of innovation in aviation, with airports switching from processing
centres to destinations in themselves, ZARINA KHAN reports.

T
he airport of the future is
no longer a bland glorified
waiting room for passengers.
Airports are evolving into a
destination in themselves, and recent
issues have highlighted their need
to evolve to meet new passenger
demands, an insider source said.
“Airports are a major player in
the aviation industry. The airport
is not just where you check-in. It’s
somewhere to do business and to
spend some time,” said Jihad Boueri,
regional director of application
services for the Middle East, Turkey
and North Africa at SITA.
In today’s economic reality
passengers have been spending more wireless and providing seamless arrival points for travellers, which
and more time at airports, agreeing to services to customers and staff alike. requires sensitive, heavy capacity IT
longer layovers in favour of cheaper “We are moving into digital travel systems and protocols.
ticket prices, and that time in transit with everything relating to mobile Another issue that the ash cloud
is likely to grow further. In April a technology and wireless technology. crisis brought to the fore was the need
volcanic eruption in Iceland resulted An airport used to just be a place with for flexible traveller check-in options to
in an ash cloud that grounded over immigration and security checks, but deal with large numbers of passengers
100,000 flights and marooned many now it’s about food, entertainment, etc. needing to rebook at the airport. “We
times that number of passengers in That presents the possibility of the are looking now for mobile check-ins.
airports across Europe. And with no information desk becoming a type of In times of crisis airlines could have
foreseeable end to the periodic plumes concierge. With wireless technology, allocated space for specific tasks,
of ash that endanger airplane engines, when a traveller accesses the airport, creating virtual zoning within the
airports may be finding themselves
looked at as a partial destination in
themselves for transiting travellers. Airports are looking beyond air revenue.
Time spent in an airport presents It’s passenger expenditure during their
many opportunities to provide services
to a traveller, and increase the airport’s journey that will count.
returns per individual.
“Airports are looking beyond air they can receive an SMS welcoming airport space,” Boueri explained.
revenue and it is their passenger them with an update of their flight. The SITA official said that a number
expenditure during their journey that As they move through the airport, of those airport service innovations
will count. This will definitely exceed they can be sped along with an E-card would be implemented in the Gulf
the ticket fees. Now a passenger can pass, and biometric data can let them before Europe, which is good news
fly a local carrier for next to nothing. know about products and services for Middle Eastern travellers.
But they still have to spend time in available at the airport according to “Compared to Europe we are
the airport. To make the most of that their preferences, which they can pay pioneering, but there is still room for
time, an airport has to ensure less for with their biometric card,” the improvement in the Gulf. Last year
time in-line and more time on-line. We SITA official added. SITA signed a number of projects
are helping with infrastructure and Airports that provide speedy in key Gulf airports including Abu
applications,” Boueri explained. passport control and security checks Dhabi Airport, Bahrain Airport and
One of the areas competition may also find themselves short Saudi Arabian airports, and more are
savvy airports are exploring is going listed as favourite departure and in the works”. ■ gb@motivate.ae

August 2010 gulfbusiness.com 41

THE BRIEFING ETHICAL INVESTMENT

Aid across the Sahara

Middle Eastern investors are increasingly turning to sub-Saharan Africa for ethical
investment opportunities.

M
iddle Eastern investors
are turning their attention
and investments to sub-
Saharan Africa, where
the World Bank estimates that the
infrastructure project finance needs
are more than $36 billion a year.
With more than $1 billion in
assets under management, the
Signature Group says the economic
argument for increased investment
in Africa is strong.
Ram Bhatia, Signature Group
CEO and director of Africa,
says: “We believe there will be a
substantial increase in the flow of
funds from Middle East investors
into developing areas of Africa in
resources, infrastructure and related
service industries.
“The continent has one-third of the
world’s mineral resources and has
weathered the global financial crisis
in relatively good shape.”
Bhatia adds that Africa is now one plant that has ownership in a copper with proven experience in their
of the fastest growing regions in mine. The project is conceptualised respective sectors.
the world, followed by Asia and the and promoted by industry “We also see our role expanding
Middle East. dominant leaders engaged in the by providing investment
“African governments understand manufacturing of various types of opportunities from India to our
infrastructure is the key to their copper conductors for over 35 years. African investors, and vice versa;
economic stability,” says Umesh The end use markets includes the and we are starting to offer African
Chandra, Signature Group CEO. GCC, India and USA. investment opportunities to our
He adds: “By deciding to enter the
African market we hope to replicate We believe there will be a substantial
the kind of business prospects we
have been undertaking in India
increase in the flow of funds from
where we are working with private- Middle East investors into developing
public partnerships, private equity, areas of Africa.
and direct project-based investments
in real estate, infrastructure, energy, Signature has devised a secure international investors, thereby
media and a few other soft sectors.” investment structure for this project, giving deals from two emerging
The group also sees opportunities which will provide stable income markets to our prospective
in mines and minerals as Africa is a along with attractive risk-adjusted investor pool.”
continent rich in varied minerals. returns to investors providing an The Signature Group is a specialist
In the Democratic Republic of estimated internal rate of return alternative asset management firm
Congo (DRC), the Signature Group (IRR) in excess of 20 per cent. focused on India, the GCC, Africa
is seeking prospective investors to Chandra adds: “Our aim is to and other emerging markets, with
be part of a backward integration work on transactions backed investment professionals based in
expansion project involving setting- by government guarantees and Dubai, Delhi and Mumbai. ■
up a Copper Cathode manufacturing the involvement of promoters gb@motivate.ae

42 gulfbusiness.com August 2010


Bank on Indian support
After 40 years of banking in India, the government owned IDBI felt the need to branch out in a
bid to establish roots in recovering and burgeoning markets, as MICHAEL GORDON discovered.
T
he Industrial Development
Bank of India (IDBI) has opened
its first branch outside of the
subcontinent, with operations
beginning in Dubai International
Finance City (DIFC) in June.
As a majority government owned (52
per cent) entity, the IDBI has already
concluded six medium to long-term
financing deals since its inauguration
in the UAE, with a combined value of
$400 million.
In terms of short-term financing in
the region, on the trade finance side,
the IDBI has around $100 million of
buyers credit on its books.
Narasinganallore Venkatesh, CEO
of the Dubai branch of IDBI, says:
“There is a lot of renewed optimism
that we are seeing in the business
climate here, and based on this, lots of
business proposals have come to us.”
Based on the initial success, the IDBI
has set a target of $1 billion in assets by
the end of its financial year on March
31, 2011. Venkatesh adds: “I think the
way things are panning out now this
is possible. Things are bouncing back
and optimism is there; yet things won’t
return to normal for another year.”
Venkatesh believes that Dubai is
ideally placed for the bank. “It connects
the East with the West. Being here will
align us with our customers in the
region that originate from India, as
well as new burgeoning clients. We also
believe that the MENA region will grow
the fastest once the market improves.
“Dubai is also ideally located in terms
of time zones, as we have the Singapore
market closing in the morning, the UK
opening mid-day, and the US opening
late in our afternoon – so our entire
clients’ needs can be taken care of from
DIFC,” adds Venkatesh.
The IDBI began life in 1964 as a
development financial institution
with a mandate to develop Indian
industry, and was converted into a
full-scale bank in 2004.
BK Batra, Executive Director & Chairman
of Credit Committee – IDBI.
Today, the IDBI is the third largest
syndicator in the Asia Pacific region,
excluding Japan, with mandates in
hand worth over $200 billion.
The IDBI is not permitted to offer
full-scale services in Dubai, and will
We are looking at the Dubai
office as a springboard for our
overseas forays.
instead operate as a wholesale bank
– permitted only to lend to wholesale
customers and to accept deposits
from outside the UAE.
Venkatesh says: “We are looking at
the Dubai office as a springboard for
our overseas forays.
“We are here [in DIFC] at an
opportune time and we see this as
a competitive advantage. Things are
beginning to improve and we can
build client relations. Also, there is
an appetite to look towards banks
like IDBI because local banks have
less funding appetite, whereas we are
looking to increase our exposure to
well performing companies.”
In addition to Dubai, the bank
has a licence for an office in
Shanghai, which is expected to
THE BRIEFING BANKING
open by December, and it is in
discussions with Singapore for an
overseas banking unit, with hopes
the licence will be in place by
January 2011 for an opening in June
2011. Furthermore, the IDBI has
approached the FSA in London and is
in preliminary discussions.
Balkrishan Batra, executive director
and group head of corporate banking
at IDBI, adds: “We see an opportunity
to associate with local business at a
time when an upturn is happening.
“We see the Asian economies, like
China and India, doing well and the
links to this region could be very
handy to boost the local economy. I
believe the dependence of this region
on Western economies could be
slightly moderated.”
In addition to new market
clients, the IDBI sees a lot of Indian
corporations operating in the UAE
which are in need of support. “Local
banks are not in such a strong
position to lend the necessary
support, but the IDBI is because of
its strong resource base, its strong
positioning back home and its good
balance sheet,” says Batra.
He adds: “We are also strong in
infrastructure financing, in transaction
banking services and FOREX services,
which are needed in this region.
“There are a large number of
infrastructure projects set up,
planned or in the process and we see
this as a good segment to leverage our
expertise and support. The other area
we can support is trade flows, where
traders need assistance for export
or import, and we can offer many
services.” gb@motivate.ae
August 2010 gulfbusiness.com 43
THE BRIEFING LAW
In a dangerous place
Husam Hourani tells
ALISTAIR CRIGHTON why
Tamimi & Partners is on the
ground in Baghdad.
A
suicide bombing in
Baghdad last month
that left 43 dead is just
the latest in long line of
atrocities that show just how fragile
the security situation in Iraq is.
Some $600 billion of necessary
infrastructure may look tempting,
but the risks are still very, very high.
Aside from security, there are aspects
of institutional infrastructure, rather
than physical, that need to be built
practically from the ground up if real
trade is to begin.
For Husam Hourani, the recently
appointed managing partner at the
region’s biggest non-affiliated law
firm, Al Tamimi & Company, Iraq is one
of the key areas for growth. Having
opened its Iraq office four years ago,
the firm is seeing steady growth as
its four fee earners there established
Tamimi as the go-to firm for legal
services in the country, especially
for US and European multi-nationals
looking to test the still murky waters.
And the legal waters are very murky
indeed, with even the basics, such as
learning what new legislation has been
passed, proving tricky. “It is difficult to
obtain copies, or the online version of
the Iraq Official Gazette, which brings
into force new Iraqi law and regulation,
which can create issues in providing
clients with accurate up to date legal
advice and opinion,” says Hourani.
“In addition, there are significant
infrastructure problems with power
failures, poor telecommunications and
internet access.”
This lack of infrastructure, combined
with the potential rewards, were the
basis for the well-attended “Doing
Business in Iraq” conference the firm
hosted in Dubai in May.
And, perhaps surprisingly, while
security may dominate headlines
about Iraq, it doesn’t rank that high on
44 gulfbusiness.com August 2010
Husam Hourani, managing partner,
Al Tamimi & Company, Iraq.
Hourani’s concerns: “All our staff and
fee earners in Iraq are Iraqi nationals,
and have the ability to move and
operate without the need of personal
security or particular concerns over
their personal safety.”
While many multinationals set
up their main base in neighbouring
Kuwait, or Jordan, this isn’t an option
for Tamimi. “Our lawyers need to be
Our lawyers need to personally
attend the Iraqi courts and this
cannot be done remotely.
‘on the ground’ as there are numerous
issues that need personal interaction
with clients and government or
ministry officials,” Hourani says.
He adds: “Our extensive dispute
resolution work means that our
lawyers need to personally attend
the Iraqi courts and this cannot
be done remotely.”
Given the ongoing difficulties of
coming and going from Iraq, however,
the company has found it expedient
to base the practice head in Jordan.
“Khaled Saqqaf, the head of our Iraq
office, is based in Jordan. This was a
strategic decision, which allows him to
travel freely throughout the region.
“Many of our clients who operate in
Iraq, are international and are often
reluctant to travel there, so the Amman
base helps us maintain our key client
relationships, meeting them in Jordan
or elsewhere.”
Tamimi is doing robust business
in its existing practices, with offices
in Iraq, Jordan, Kuwait, Qatar, Saudi
Arabia and the UAE, according to
Hourani. An emphasis on contract law,
lucrative during the boom years, has
been replaced by a focus on litigation,
as those same contracts now fall into
dispute, he says.
The company is also reaping the
benefits of local knowledge. Hourani
says that clients who may have been
attracted by bargain basement offers,
from incoming international law
firms desperate to attract business,
are returning to the fold as those
same companies struggle to deliver
on their promises.
In addition to growing work with
existing offices, since being promoted
to managing partner in February,
Hourani has been tasked with looking
at growth opportunities outside
Tamimi’s traditional base. So far,
Bahrain and Egypt have been identified
as key targets. Given the firm’s success
across the Gulf to date, Hourani, a
12-year veteran of Tamimi, should not
face too many challenges in taking a
well-known name into new territories.
■ gb@motivate.ae
 THE BRIEFING FISHERIES

The deadliest catch

Politicians argue that coastal developments are forcing fishermen to risk their
lives by crossing borders to meet their quotas.

F
ishermen throughout the Gulf
region are increasingly finding
themselves in hot water, with
several arrested and even shot
for crossing international borders.
Earlier this year, a Bahraini
fisherman was shot by Qatari
coastguards for allegedly entering
Qatari waters illegally. The confused
sailor was taken to hospital with
promises he would be released in
a few days.
However, the authorities later
said they would put him on trial for
illegally entering the country. The
shooting came less than a year after
a Qatari coastguard vessel collided
with a Bahraini fishing boat, hurling
a fisherman overboard into the sea
where he drowned.
In both instances, the Qatari
authorities said they used force
because the fishermen refused to stop.
While Bahraini fishermen say that
they have problems recognising the
water delimitations, Qatari officials Conservation Affairs, the Ministry Sector, CNIA, says: “We advise all
say they are vigilant over their of Environment and Water, affirms: fishermen to remain in contact with
borders because of an increase in drug “Construction on coastlines does CNIA while they are at sea.
smuggling in the area. affect the habitat of the fish inhabiting “When boats are equipped with
Only last month, 11 fishermen the area. Stocks are depleting, that is a the E-Passport device, CNIA knows
from Asian countries were taken into fact, but the reasons are many.” exactly where they are located,
custody after they crossed into UAE
waters without permission.
The Saudi Gazette reported that the We advise all fishermen to
fishermen were crossing from the Qatif remain in contact with CNIA
area in Saudi Arabia. Again the men
claimed they were not aware they had while they are at sea.
crossed international boundaries.
The Institute for Near East & Gulf Abu Dhabi’s Critical National which ensures a more immediate
Military Analysis (INEGMA), which is a Infrastructure Authority (CNIA) response from rescue teams in
Middle Eastern think tank, claims it is works with the coastguard to ensure emergencies,” he adds.
a common occurrence for fishermen to the safety of all seafarers. Last year Last year, through its Bihar
cross international borders illegally. the CNIA introduced the E-Passport campaign, CNIA met with local
Furthermore, in recent reports, device which tracks fishing boats and fishermen to hear their concerns and
Bahraini politicians blame government other vessels in the emirate’s waters. to help them understand the marine
policies regarding sea reclamation The device is a safety measure and safety laws that are currently in place.
for the troubles facing fishermen, and allows boats to immediately contact “We intend to continue this dialogue
questioned their legality and necessity. CNIA for help in an emergency. to ensure that fishermen know that
Saif Mohamed Al Shara’a, CEO. Staff Colonel Ishaq Al Besher, CNIA is here to help them,” adds Al
Water Resources and Natural executive manager of Operation Besher. gb@motivate.ae

August 2010 gulfbusiness.com 45

THE BUSINESS PLASTIC INDUSTRY

Plastic fantastic
After a number of false starts, the Gulf is finally embarking on an
industrial revolution that could see it emerging as a major player in
polymer production. MICHAEL GORDON reports.

I
n a bid to capitalise on its vast feed-
stock resources, add value to its
production chain and to create jobs
in a market of high unemployment,
the Gulf region is repositioning itself
to become the global hub for the pro-
duction of commodity petrochemicals.
Utpal Sheth, director – Polyolefins &
PVC – Middle East / India, CMAI Middle
East said the need for nationalised jobs
is spurring development: “The Middle
East has numerous large oil, gas and
petrochemical plants, but they are all
fully automated and very few persons
are required to run them.
“The direct employment generated by
these large projects is also very small
compared to the investment. However,
the plastics converting industry is
usually more labour intensive. Thus by
promoting plastic converting plants,
the regional governments want to pro-
vide better employment opportunities
for the citizens of the country.”
However, Sheth added: “Apart from
the basic purpose of providing employ-
ment to the local citizens, development

46 gulfbusiness.com August 2010

iStockphoto
THE
THE
BUSINESS
BUSINESS
PLASTIC
ARCHITECTURE
INDUSTRY

Aaugust2010
August 2010gulfbusiness.com
gulfbusiness.com 47
THE BUSINESS PLASTIC INDUSTRY

of downstream units also helps in con-

Middle East PE and PP Production Growth Trend suming locally the large volume of raw
material produced in the country.”
Million Metric Ton
14 The secretary general of the Gulf Pet-
rochemical and Chemical Association
12 (GPCA), Dr Abdul Wahab Al-Sadoun,
agreed: “The key component in plastic
10 conversion is cost of raw materials, the
labour accounts for only five to seven
8 per cent of the cost, the rest is up to 70
per cent raw material cost.
6
“These developments in Saudi Ara-
4
bia, Abu Dhabi, Qatar and Kuwait
are very positive. The expansions are
2 driven by a need to create job oppor-
tunities and more are created here
0 than compared to upstream indus-
2005 2010 tries – this is why the government is
behind these developments. That is
MDE PE MDE PP
why the government is building the

48 gulfbusiness.com August 2010

 THE BUSINESS PLASTIC INDUSTRY

facilities, sites and infrastructure.

“Furthermore, plastics can be Growth Dimension & Future Gulf Position
sustainable and an environmentally The Gulf industry’s position as a global hub for the production of plastic resin is large
responsible solution to society’s and will begrowing markedly over the next five years or so
questions. Although the plastic industry 2009 2015 E
is often a target for not being socially Product Gulf World Gulf Share Product Gulf World Gulf Share
responsible, plastics are necessary to % %
our everyday life as they are used in Ethylene 16.8 133.5 12.6 Ethylene 32.0 156.5 20.5
medicine, packaging, construction and Polyethylene 10.7 83.0 12.9 Polyethylene 20.3 113.0 18.0
agriculture,” he added.
MEG 6.0 23.3 26.0 MEG 10.8 37.9 28.5
This diversification into plastics is
Propylene 5.1 87.5 5.8 Propylene 10.1 105.0 9.6
in direct contrast to the situations in
Polypropylene 5.05 54.4 10.8 Polypropylene 10.2 73.0 14.0
Europe and the US. As the leading ex-
Source: GPCA, 2010
porters of petrochemicals in the past,
both are now switching from being net
exporters to net importers, and none
more so prevalently than the US.
As one of the largest plastics produc-
ers, both regionally and internationally,
Borouge supports the development of
the Gulf’s downstream plastics indus-
try and the contribution it can make
to Vision 2020 and the growth of the
diversification of the UAE economy.
Craig Halgreen, vice president global
communications of plastics company
Borealis, said: “With 4.5 million tonnes
of polyolefins (PP and PE) annual capac-
ity versus the 600,000 tonnes per year
today, we will rapidly become a major
player in the Gulf and global markets.
“We are confident that more and The regional governments want
more companies will play a role in this to provide better employment
diversification of the industry, consid-
ering the attractive growth potential of opportunities.
the region.”
Expansions underway in the Gulf at In July 2008, Emaar, The Economic advantage in, according to a spokes-
the moment will see the production of City (EEC), which is developing the person. The spokesperson added: “The
raw materials for plastics double. In King Abdullah Economic City (KAEC), company is now unsure whether to
2009, the total output of the Gulf region signed a memorandum of understating further tackle this sector given the re-
was 10.1 million tonnes of polyethylene (MoU) with StrateSphere Enterprises gional competition.”
(PE), which will rise to 21 million tonnes in collaboration with PolymerOhio, Earlier still, Dubai dropped its plans
by 2015. In 2009, the level of polypro- and the Saudi Arabian General Invest- for a dedicated plastics park, alongside
pylene (PP) production was 4.8 million ment Authority (SAGIA) to pursue the the well-established JAFZA free zone
tonnes rising to 9.5 million by 2015. development of KAEC Plastics Valley. in Jebel Ali. Eventually Abu Dhabi hit
Over the next five years, the region’s The goal was to position KAEC upon the winning formula, and the Abu
polymer production will double, allow- Plastics Valley as a global centre of Dhabi Polymers Park (ADPP) is set to
ing the Gulf to claim around 13 to 14 per excellence in the plastics sector. Sev- become the world’s largest plastics
cent of the total global polymer produc- eral plastics companies were expected park. The Abu Dhabi Basic Industries
tion. That’s not bad when you consider to set base in the Plastics Valley cluster Corporation (ADBIC), a wholly owned
the region was a major net exporter of with investments expected from several government entity, launched the
raw materials only a few years ago. countries across the world. project. Jamal Al Dhaheri, CEO of
Yet before the winning formula was However, 18 months later, EEC’s ap- ADBIC, said: “Abu Dhabi Polymers Park
struck upon, there were a few failed proach to the plastics sector is now put helps to deliver on the government’s
attempts at establishing competitive on hold whilst focus is given to other 2030 plan by leveraging Abu Dhabi’s
plastics production in the region. sectors that the city has competitive competitive advantage and providing

August 2010gulfbusiness.com 49
THE BUSINESS PLASTIC INDUSTRY
relevant value-added services to
investors. “It will create sustainable
economic value by integrating
upstream, midstream and downstream
sectors. Developing the downstream
polymer conversion industry will
create regional manufacturing, jobs,
local know-how and a sustainable
industrial base.
“By 2015 we are expecting to attract
Plastics can be sustainable and
an environmentally responsible
solution to society’s questions.
up to 50 convertors and an estimated
investment of $2 billion into the area.”
This 4.1 square kilometre site in
Mussafah is only 20 minutes from
Abu Dhabi city and 40 minutes from
Taweelah port. It will be advantaged by
a developed infrastructure, competitive
labour costs, utilities and raw materi-
als (PE, PP, PVC and polyester).
A spokesperson for ADBIC said:
50 gulfbusiness.com August 2010
“The clustering model, combined
with competitive financing options,
form additional key ingredients to
establishing the park as a globally
competitive production hub.”
Furthermore, it will be equipped with
specialised technical and logistic serv-
ice centres, zero tax on company and
private income and competitive land
lease rates.
The ADBIC spokesperson remarked:
“The regional plastics market is grow-
ing at approximately five per cent above
GDP growth rates and in addition to lo-
cal consumption, Abu Dhabi offers an
excellent base for exporting to regional
and international markets.
“Abu Dhabi, and the wider GCC, has
abundant and competitively priced
feedstock, and low investment and op-
erating cost structures. Coupled with
a zero tax base, these factors create a
compelling case for polymers conver-
sion industries to be based in ADPP.”
According to the spokesperson,
there is no issue over feedstock avail-
ability. He said that the GCC produces
13 per cent of the world’s plastic raw
materials. This is expected to increase
to 20 per cent in the next five years.
Polyethylene, polypropylene, poly-
styrene, polyethylene terephthalate
(PET), polyvinyl chloride (PVC), poly-
carbonate and acrylonitrile butadiene
styrene (ABS) supply in the region is
growing, and by 2016 UAE and GCC
feedstock supply is set to grow to 43
million tonnes per annum.
The ADBIC spokesperson said: “Pet-
rochemical refining capacity in the
region is growing, as is the feedstock
supply. It makes economic sense to
leverage local feedstock supply with
low investment and operating costs to
create a robust downstream industry
within the region.

“Moving down the petrochemical
chain, the polymer conversion industry
adds significant value to locally pro-
duced feedstock.”
Despite the early setbacks, it is this
projected growth that makes Dr Al-
Sadoun confident that by the end of
2015 the Gulf will produce around
13 to 14 per cent of the total global
plastics output.
Dr Al-Sadoun said: “This has
emerged from nothing in very short
time, doubling in only five years. The
Gulf region is emerging to be the glo-
bal hub for the production of com-
modity petrochemicals. Subsequently
there is a drive to go into high value
products downstream into plastic
conversion and specialty products.
“In contrast, the upstream markets
in Europe and the US are struggling
because of ageing facilities, a lack
of financing and the high cost of
maintenance – this is helping new
dynamics in the industry. The Gulf
region and China are emerging to
be the new centres of gravity for the
THE BUSINESS PLASTIC INDUSTRY
global petrochemical industry.”
Dr Al-Sadoun argued that because
the petrochemical industry in the Gulf
was export oriented from conception,
no matter how much downstream de-
velopment there is, it will continue to
be a net exporter even though the ex-
pansion is phenomenal.
The ADBIC spokesperson added: “We
expect 30 to 40 per cent of the plastics
will be for regional markets, with the
remainder catering to international
markets.” Natural export markets are
to the west as the cheap labour costs in
Asia feed the Asean (The Association
of Southeast Asian Nations) markets.
However, there is concern over EU
tariffs on UAE plastic exports, which
have stoked fears of trade protection-
ism. Last month, the EU imposed new
tariffs on the UAE, Iran and Pakistan
for material used in plastic bottles
and films, arguing that price under-
cutting was harming EU producers.
If the plastics converting units in
the GCC are to succeed, they have to
focus on exporting finished products
to major global markets. Thus they
will be competing with the low cost
converting centres of Asia, who sup-
ply the bulk of plastics products to
the developed world. Dr Al-Sadoun
said: “In certain products we can com-
pete head-on with Asean producers,
such as in plastic films. But in blow
moulding the products are usually
not for export as the cost of shipping
is high as they are bulky products. On
the film products you can achieve a
high density in packing the products.
“We have already seen some pro-
ducers in the Middle East exporting
to Europe, the US and even Canada.”
Sheth concluded: “There are
numerous factors that will make or
break this initiative of developing
the plastics industry in GCC, and it
is still too early to give the verdict.
The economic downturn in 2008-09
has considerably slowed down the
investment in plastics parks, and it
will take at least a couple of years
before we have a clearer picture’’. ■
gb@motivate.ae
August 2010 gulfbusiness.com 51
THE BUSINESS SPORTING ARABIA
The Gulf gets
its game on
Football sponsorship and Formula One have
helped put the Gulf on the sporting map, but the
ambitious region is now setting its sights on the
Olympics, the World Cup and other global fixtures.
ROBERT BAILEY looks at the hurdles ahead.
A
decade ago major sporting fix-
tures were virtually unknown
in the Gulf, but big-ticket
events have now become
regular features on the sporting
calendar. Much of this has resulted
from persistence and big spending,
which is making the region’s plans in-
creasingly ambitious.
The motive is straightforward, since the
Gulf’s administrative elites see sporting
events as making an impact on the world
stage, with the host gaining an affirma-
tion of status and a demonstrative way of
putting their countries on the map.
As a consequence the region’s
sports developments are pressing
ahead in spite of a squeeze on capital
expenditure in other areas.
Doha, for example, has built on its
successful staging of the Asian Games
in 2006 and in March this year was the
venue for the International Association of
Athletics Federations championships.
52 gulfbusiness.com August 2010
Dubai is host to two major tennis
championships as well as prominent
golf tournaments. The annual Dubai
World Cup horse race, now held at the
new Meydan racecourse, is ranked as
the richest event in the sport with prize
money totalling $10 million.
From football, rugby, cricket and
tennis, athletics to motor sports, golf
and horse racing, the list of events
continues to grow. Oman is preparing to
host the Asian Beach Games in Muscat
later this year. An athletes’ village able to
accommodate 3,000 participants, grand-
stands as well as hotels and other visitor other motor-related competitions draw-
facilities are being developed on a one ing in visitors and income for the island.
million square metre site for the event. Initial costs are huge though. Abu
Led by the buying powers of Abu Dhabi, Dhabi’s Yas Marina circuit is thought
Qatar and Dubai, the Gulf has entered the to have cost close to $800 million, with
big league of world sports. At the high- Formula One franchise holder, Bernie
end of the spectrum, Formula One has Ecclestone, reported to have received
taken root. Bahrain staged its first For- $80 million in fees.
mula One Grand Prix in 2004 and as a The commercial side of this raised
consequence has developed a number of profile for sports is also apparent in
 iStockphoto

sponsorship agreements entered into by substantially in the last decade. Most Emirate’s logo, but there is also sponsor-
the region’s airlines, including Etihad, notably, Arsenal a leading English foot- ship deals in motor sports and rugby.
Gulf Air and Emirates. The latter has ball team, has renamed its stadium after Gulf investors are shareholders
increased its sponsorship budget the airline and the clubs shirts carry in some of Formula One’s leading
racing teams. Abu Dhabi’s Mubadala
Development Company holds a five
Abu Dhabi’s Yas circuit is thought to have per cent stake in Ferrari, and Bahrain’s
cost $800 million, with Bernie Ecclestone Mumtalakat Holdings has a 30 per cent
stake in the McLaren team.The Williams
reported to have received $80 million in fees. motor racing team, meanwhile, has set

August 2010 gulfbusiness.com 53

THE BUSINESS SPORTING ARABIA
up a centre in Qatar to develop new
car technologies.
Money is talking big elsewhere as
an increasing number of high profile
managers, as well as players, from
Europe and Latin America are lured to
the Gulf’s club football scene.
Following last November’s Abu
Dhabi Grand Prix, a friendly match
was played between a UAE 11 and the
English Premiership side Manchester
City, now owned by multi-billionaire
Sheikh Mansour bin Zayed al-Nahyan.
The reward for the football club taking
time out from hectic domestic fixtures
to play at Qatar’s Khalifa International
stadium was a rumoured $7.5 million
match fee.
The event was a precursor to Abu
Dhabi’s hosting of the FIFA Club World
Cup, due to be played later this year
at the 50,000 seat Zayed Sports City
stadium and 42,000 seat Mohammed
COMPETING FOR THE BIG PRIZES
O btaining major international sports
events is a tortuous process
with unpredictable outcomes. Things
are not all plain sailing, literally, as
Ras Al Khaimah found when it was
unable to host the America’s Cup
yacht competition after last-minute
objections, ostensibly on technical
grounds, by the US challenger.
Doha’s failure last year to make
an International Olympic Committee
shortlist bidding for the 2016 games
was also a bitter disappointment.
Officially, the bid’s weakness was put
down to the dates in October proposed
by Qatar officials in order to avoid the
most extreme summer heat and ambient
temperatures of up to 50 degrees Celsius.
But hosting an Olympics later in the
year is not without precedent. Tokyo
and Mexico held their games in October
and the Sydney games were held in
September, while the 1956 Melbourne
games stretched into December.
The International Olympic Committee
said one of the reasons it did not select
Doha for the shortlist of four candidates
was Qatar’s short sporting legacy.
54 gulfbusiness.com August 2010
We hope that hosting an event like the
World Cup will be a catalyst for expanding
Qatar’s tourism industry.
bin Zayed stadium, with UAE club Al
Wahda the local participant.
The emirate’s aim to become a regular
international sports venue is also
illustrated by Abu Dhabi’s Mubadala
Real Estate & Hospitality’s plans to
invest in a 65,000-seat stadium with a
retractable roof.
Football is the region’s main sports
focus and there are high hopes that
Qatar’s bid to host the 2022 football
World Cup will be successful.
Hassan Al-Thawadi, chief executive
of Qatar’s bid committee, said: “We
hope that hosting an event like the
World Cup will be a catalyst for
expanding the tourism industry which
However, the bid team’s leader, Hassan
Alibin Ali, was quoted as saying: “This is
not a technical decision. It is a pity they
have closed the door on the Middle East.”
In May, it was reported that Dubai had
withdrawn from plans to host the 2013
World Swimming Championships.
Julio Maglione, President of the
Federation Internationale de Natation
(Fina), the global governing body for
swimming, commented: “We believe
that at this stage it is of paramount
importance to further improve the
impact of aquatic disciplines in this
Middle East before staging a Fina World
Championship with our five sports.”
However, Dubai is to host Fina’s short
course swimming championships using a
25-metre pool in December. Saudi Binladen
Group was awarded a $300 million contract
to design an aquatic sports centre and pool
for the event in 2010.
Observers sense that politics lurk in the
background, not least the thorny issue of
the recognition of Israel and admission of
the latter’s athletes and officials in any large
numbers for major international competitions.
In this respect, the Gulf’s ambitions to host
will be a great boost for the economy
and Qatar’s diversification plans.”
Dubai has also expressed keen
interest in staging the Olympic Games
in 10 years time. A working group of
government officials and private sector
representatives to examine a bid has
been established by Sheikh Mohammed
bin Rashid Al Maktoum, Vice-President
and Prime Minister of the UAE and Ruler
of Dubai. A prominent element would
be a new stadium to accommodate
80,000 spectators.
Sheikh Mohammed stated in April:
“We will have to take an honest look
at our weaknesses as well as our
strengths. I can assure you of this
the biggest international sports events
face a dilemma. However, difficulties can
be overcome. This year Shahar Peer, the
Israeli female tennis player, became the
first Israeli athlete to compete in the UAE
during the Dubai tennis championships.
Contests that involve teams and mass
participation, with the raising of flags
and the playing of national anthems, may
provide a sterner test.
There is a balance to be reached
against perceived benefits and investment
costs, as well as political risks. For an
established major global metropolis such
as London, arguments about raising the
city’s international profile seem weak and
any legacy gains in terms of developing
the east side of London for the 2012
Olympic Games have still to be measured.
For the Gulf, and other emerging
regions, it is an entirely different ball
game. The benefits of hosting an
Olympics for a city and country could
fully justify the promotional hype by
providing a powerful stimulant to
economic and social development, as
well as raising the national brand and
future global competitiveness.
THE BUSINESS SPORTING ARABIA

August 2010 gulfbusiness.com 55

THE BUSINESS SPORTING ARABIA
QATAR PRESSES CASE TO HOST WORLD CUP
Q atar was encouraged in its bid to
stage the 2022 World Cup in April
following backing from FIFA’s President,
Joseph Sepp Blatter, when he declared:
“The Arab world deserves the World
Cup and Qatar has a good chance to
become the first country from the region
to host it.”
In May, Qatar’s 2022 bid committee,
headed by chairman Sheikh Mohammed
bin Hamad bin Khalifa Al-Thani,
delivered Qatar’s 750-page bid book
and additional seven binders with
over 2,000 pages of supplementary
documents to Blatter and FIFA
Secretary General Jerome Valke.
Promoted as the first carbon-neutral
World Cup, new technologies will be
utilised to provide groundbreaking
cooling systems for 12 stadiums,
fan areas and training grounds.
Spectators, players and officials will
be able to enjoy cool and comfortable
open-air conditions not exceeding
27 degrees Celsius.
Qatar 2022 chief executive, Hassan
Al-Thawadi said: “People in the Middle
East are longing to host such a big
football tournament. We are very
excited by the challenge. For the World
Cup, the cooling systems that Qatar is
developing for stadiums could be a real
asset for other countries with warmer
climates around the world.”
Qatar has unveiled plans to build three
new stadiums, as well as to upgrade
two others, as part of its bid to stage the
World Cup. Qatar will also promise to
have 110,000 hotel rooms and serviced
apartments by 2022, 90,000 of which
56 gulfbusiness.com August 2010
have been guaranteed for FIFA’s use
during the tournament.
Al-Thawadi believes Qatar’s compact
size could be a major selling point in
its bid. By 2022, Qatar will also have
a major new international airport in
operation as well as a new overground
and underground railway system.
“Fans would not have to worry about
booking accommodation in different
cities in order to follow their teams
throughout the tournament. Qatar
2022 would be a tailor-made, compact
World Cup with stunning stadiums and
seamless transportation,” he said.
Qatar has embarked on research into
cooling methods that are effective and
environmentally friendly.
Three 45,000-seat air-conditioned
stadiums will be built employing solar
technology to ensure temperatures rise
to no higher than 27 degrees Celsius on
the pitch.
Nasser Al Khater, communications
director of the Qatar 2022 bid, says
that a cooling system has already
been used at the 18,000-seat Al Sadd
stadium in central Doha. “It has
worked to perfection, so rolling this
out to the other stadiums will not be a
problem as it is part of our country’s
development goal.”
Qatar also intends to share its cooling
technologies with the rest of the world
and work with FIFA to donate 170,000
stadium seats from its modular stadiums
to developing countries at the end of the
competition. “This is a bid for the region
and for the world. Qatar is ready to
deliver,” said Al-Thawadi.
though, if we decide to make a bid for
the Olympics, we will be in it to win.”
Sports events have not been a casualty
so far in Dubai’s struggle to reschedule
its huge debt mountain. In March this
year the $2 billion Meydan horse racing
complex was inaugurated and held its
first Dubai World Cup event.
In Dubai Sports City, managers have
said that progress is ongoing on a clus-
ter of major venues due to stage sports
events as well as training facilities and
specialised academies for golf, tennis,
football, rugby, cricket and swimming.
In April, the International Cricket
Council, which relocated from Lords
Cricket ground in London to Dubai in
2005, moved into new accommodation
in the sports district. Khalid Al Zaroomi,
president of Dubai Sports City, said: “The
opening of the ICC headquarters is the
first of many projects which are soon to
open as Dubai Sports City comes to life.”
A cricket academy is nearing
completion following last year’s
inauguration of a new 25,000 capacity

cricket stadium which draws large
crowds from Dubai’s foreign residents,
particularly from India, Sri Lanka,
Pakistan, Bangladesh, England,
Australia and South Africa.
Dubai Sports City has been described
as the world’s first integrated sports
community. Formally launched in 2004,
the $4 billion development is a 4.6 mil-
lion square metre mixed-use sports
Sports events have not been a casualty
so far in Dubai’s struggle to reschedule
its huge debt mountain.
development designed to eventually
include real estate, commercial prop-
erty and retail outlets in addition to
major sports venues and academies.
The first completed project was the
Els golf club. Named after Ernie Els,
the club boasts an 18-hole champion-
ship standard course.
In addition to the cricket ground, a
THE BUSINESS SPORTING ARABIA
60,000-seat stadium and a 5,000-seat
field hockey venue, as well as a
10,000-seat indoor arena will be core
elements of Dubai Sports City once
fully finished.
Various academies to develop
young people’s skills in football,
golf, hockey, tennis, rugby, swimming
and athletics are also central to the
development, which will also feature
advanced medical facilities for treating
sports-related injuries.
Saudi Arabia is also seeking to
emulate this integrated concept with
the King Abdullah Sports City project.
The planned $4 billion mixed-use
development comprises five major
sports venues to be built north of
Jeddah on a nine million square metre
site. The main feature will be a 100,000-
seat football stadium in addition to
indoor stadiums as well as a specialist
sports hospital.
Jeddah’s mayor, Adel Fakiah, describes
the planned development as, “a huge
cultural landmark and a symbol of
comprehensive development in the
Kingdom which will boost sports and
youth activities in Saudi Arabia.”
The Basra Sports City project has
also been launched in Iraq at a cost
of $550 million. Two stadiums are
planned, with the largest able to seat
65,000 spectators and a smaller one
able to accommodate 20,000.
A range of additional sporting
facilities and four hotels are part of the
plan, which is aimed at hosting the 2013
Gulf Cup of Nations football competition
between the six GCC states, plus Yemen
and Iraq. Two American contractors,
360 Architecture and Newport Global,
are involved in the construction
project with local contractor Abdullah
Al-Jaburi. gb@motivate.ae
August 2010 gulfbusiness.com 57
THE BUSINESS BAHRAIN
New kid on the block
Bahrain is once again reinventing its offering to the global financial markets
by hosting the very-first cross border multi-asset financial exchange in the
MENA region, as MICHAEL GORDON discovered.
W
ith its country-wide free
zone status, singular
regulatory framework,
and a financing pedigree
dating back to the 80s, Bahrain was
the perfect place for the Financial
Technologies Group (FT Group) to
establish the first cross border multi-
asset financial exchange in the Middle
East and North Africa.
Arshad Khan, managing director and
CEO of the Bahrain Financial Exchange
(BFX), and BFX Clearing and Depository
Corporation (BCDC), which are wholly
owned by FT Group, has spent the last
six months in the Middle East, getting
familiar with the nuances of the capital
and financial markets of the region.
Ever since Bahrain presented itself
as somewhat of a safe haven in trou-
bled waters for the banking community
in the 1980s the country has continued
to diversify its offering to create niche
solutions. Most recently this has been
Islamic financing.
And although Bahrain has had a
stock exchange for years, this financial
exchange will be the first to be inter-
nationally accessible, which has long
been a concern of foreigners looking to
invest in Middle Eastern markets.
Khan was the ideal candidate to set
up this exchange, as he was able to
deploy a business model he had cre-
ated and developed from invaluable
experience gained in India and the
United Arab Emirates.
In 2001, the FT Group approached
58 gulfbusiness.com August 2010
the Indian government to set up a full
commodities and derivates exchange in
there. After a lot of discussions permis-
sion was granted early in 2003. In its
first three to five years this exchange
was ranked in the top 10 worldwide. To-
day it is placed sixth and does $5billion
of trading every day.
Furthermore, the FT Group currently
has permission to set up a stock ex-
change in India, and, as part of multi
asset profile, BFX will also become a
stock exchange sometime next year.
The system we have in place can decide a
loan in less than one minute, whereas the
conventional method can take from three
hours to three days.
Khan added: “Upon the success in
India, we were invited by Dubai to set
up an exchange in joint venture with
the government.”
In November 2004, Khan set up the
Dubai Gold and Commodities Exchange
(DGCX), in conjunction with Dubai Mul-
ti Commodities Centre (DMCC), using
the Indian business model.
That model has since been replicated
in other parts of the world, and Khan
has gone on to establish the FT Group’s
business in the Middle East. Financial
Technologies Middle East (FTME) is a
100 per cent owned subsidiary of FT
India, which was incorporated into the
DMCC free-zone in Dubai.
Under his stewardship, FTME
successfully rolled out automation
solutions for brokers in the regional
exchanges and established the
Financial Technologies Centre for STP
Services (FT-CSS) in the UAE.
Khan’s track record and experience
in the region helped him build a strong
relationship with the Economic Devel-
opment Board of Bahrain (EDB) and
the Central Bank of Bahrain (CBB). As
a result, the idea for BFX crystallised
and was formally established in 2009
with Khan serving as its first Board
Director. BFX is the first multi-asset
exchange in the MENA region, which
will be internationally accessible to
trade cash instruments, derivatives,
structured products and Sharia’ah-
compliant financial instruments
when it opens in October.
Khan said: “Currently there is a lot
of money in this region but it goes out
to Western or Asian markets because
there has been no other option.
“Our research of user requirements
highlighted the index product on the
conventional side, and on the Islamic
side there was a need for commod-
ity murabaha, which offers a tool to
THE BUSINESS BAHRAIN

August 2010 gulfbusiness.com 59

THE BUSINESS BAHRAIN
One of the key advantages of working
with Bahrain was the flexibility to
allow cross border investment.
manage the lending and borrowing of
money in Islamic markets.
“The automated system we have in
place can decide a loan in less than
one minute, whereas the conventional
method can from take three hours to
three days, and it can be a very expensive
and cumbersome process.
“From the UAE we recorded heavy
interest in index products – people, re-
ally looking forward to trading on the
futures market on the index products
we will launch.
“We are also getting a lot of interest
towards commodities, and have come
out with an innovative contract called
‘Gold Mini”, which is just 100g compared
to the usual 1kg contract,” he added.
By being a multi-asset exchange, the
BFX can offer market users the benefit
of being able to trade multiple products
on one environment providing a reduc-
tion in trading costs, risk management
60 gulfbusiness.com August 2010
WHAT THE NEW
EXCHANGE WILL TRADE
Cash instruments:
Equities, bonds, notes, certificates
of deposit, depository receipts,
Exchange Traded Funds (ETFs),
Exchange Traded Commodities
(ETCs), Real Estate Investment
Trusts (REITs)
Derivatives instruments:
Swaps, futures, options and
swaptions. Underlying can be
commodities, currencies, equities,
financial instruments or indices
Sharia’ah-compliant financial
instruments:
Equities, Sukuk, Murabaha, Wakala,
Islamic Options, Islamic Repo,
Islamic ETFs, Islamic REITs.
synergies and access to deep liquidity
pools. Khan said: “When we met the
Bahrain government two years ago we
convinced them that a single asset ex-
change would lose popularity in favour
of multi-asset platforms. This is largely
because investors can split the risk;
those exposed to a single asset class in
the past got burnt, especially those in
real estate.
“With a broad-based portfolio you
are hedging your risk, and most asset
classes are inversely related, so when
one goes up the other goes down,”
said Khan.
Having a multi-asset exchange license
the BFX can offer products and services
to both the Islamic and conventional
markets with the objective of facilitat-
ing investment, risk management and
raising capital.
However, Khan warned: “A multi as-
set exchange licence can be a virtue and
a vice, because the market can expect
too much of you and its impossible to
make every product a success.”
From a commercial viewpoint, the
BFX has conducted a needs assess-
ment of the market by visiting over 200
key institutions in the region in order
to ascertain the range of products the
industry requires.
”The response was exceptionally
positive, resulting in a phased roll out
plan being adopted with a roadmap of
conventional and Islamic cash instru-
ments and derivative products devel-
oped,” said Khan.
The BFX has chosen the Kingdom of
Bahrain as an ideal location to oper-
ate in for its well-known reputation
in financial market history, and a high
banking sector concentration.
In addition to that, Bahrain’s market
orientated approach toward becoming
a regional and international financial
centre has made it home to over 400
licensed financial institutions, giving
access to a deep and diverse financial
community.
Khan added: “One of the key advan-
tages of working with Bahrain was
the flexibility to allow cross border
investments so someone in Jordan
can buy into the Bahrain exchange.
In most other markets there are many

restrictions on international trading.”
Bahrain is also widely regarded as
the best regulated financial centre in
the Middle East, with the BFX being
established to trade and clear multi
assets and regulated under the govern-
ance of the Central Bank of Bahrain
(CBB), whilst also enjoying the support
of the Bahrain’s Economic Development
Board (EDB).
“Bahrain is a very unique country in
terms of its free zone status – with the
entire country being free, so you can set
up anywhere.
“Bahrain also has a single regula-
tory framework. The Central Bank of
Bahrain supervises all of the verticals
of financial markets. This gives a lot ef-
ficiency as there are many verticals,”
said Khan.
The BFX platform for multi-asset
class trading will offer market partici-
pants the ability to trade multiple asset
classes on one market. The BFX product
portfolio can be split into three main
categories: cash instruments; deriva-
tives instruments; and Sharia’ah-
compliant instruments.
The BFX also plans to have around
200 financial companies as members.
The members of the BFX can then of-
fer products and services to end clients
giving them access to risk management
and investment solutions.
“We are targeting 40 to 50 brokers,
before we go live in October, through-
out MENA and Indian subcontinent,”
said Khan.
He added: “Consciously, we don’t
want to offer everything on day one,
so we will launch products in two
phases. In October we will start
with derivatives, like commodities,
currencies, energy products and
THE BUSINESS BAHRAIN
innovation indexed products on
equities. We have structured out
products to encourage both institutions
or retail to invest in our market – this is
the only way to increase liquidity.
“Once this derivatives segment is
a success, after six months we will
launch our share segment – the equities
market – trading in bonds, ETFs, etc.”
Although the FT Group has ex-
changes in India, Singapore, Dubai
and now Bahrain, each will operate
its own jurusdiction so each has its
own clearing corporation. “At this
stage what we have is exchange cost
listings of products between exchang-
es. First the exchanges must become
established and successful and then
there are plans to integrate them,”
said Khan.
“We expect cross exchange to be
available in one to two years so Bahrain
could buy Singaporean currency or Sin-
gapore could buy Islamic financing.”
In addition to the financing services,
the FT Group has also established a
training centre in Bahrain. The BFX
Training Institute is located within
the BFX, and it will offer an extensive
course programme to meet the needs of
a diverse user profile covering a wide
range of financial markets and asso-
ciated financial instruments with the
objective of introducing market con-
cepts to new users as well as enhancing
and refining current knowledge.
The Institute is partnered with
Financial Technologies Knowledge
Management Company, which is a key
player in the training and education
field. The BFX Training Institute also
plans to partner with other training
Institutes to provide a world class pro-
gramme of financial services in training
and education for the MENA region.
Khan said: “Without education this
market will not be successful.” BFX is
undoubtedly a unique product it seem-
ingly addresses a repeatedly voiced
concern in the region. However, the
global financial market is still very
much in the doldrums, so it will be
interesting to see how investors rush
to secure membership in the last few
months before the exchange throws
open its doors.
The ultimate goal is 200 members,
but a much more moderate target of
40 to 50 has been set for the inaugura-
tion. ■ gb@motivate.ae
August 2010 gulfbusiness.com 61
THE BUSINESS CORRUPTION
Anti-corruption
efforts intensify
As the Middle East’s economy emerges from the doldrums, several
transparency lessons have been learnt, as ROBERT BAILEY discovered.
T
he global financial crisis has
put the spotlight on the region’s
customary lending habits as
well as raising the much wider
issue of corporate governance. Difficult
questions have been raised and they
are not going away.
More often than not, leading com-
panies in the region are affiliated to
prominent families, which are tradi-
tionally very wary of public scrutiny.
One of the main lessons drawn from
the debt defaults by two Saudi fami-
ly-owned businesses in 2009 was the
danger of “name-lending” with loans
agreed and based on the strength of
a reputation.
Absence of disclosure has allowed
some conglomerates to accumulate
debt with few questions asked, result-
ing in an overleveraging far beyond
any capacity to repay borrowed sums
within agreed timelines.
Neglect of basic corporate best
practice may have been acceptable
when the region’s economies were
less developed and less integrated
with the rest of the world. Interna-
tional lenders are now demanding
much more clarity on ownership struc-
tures – how money is going to be used
and how loans will be repaid.
Another serious threat to sound busi-
62 gulfbusiness.com August 2010
ness practice is the ability of corrupt
practices to flourish with such a lack of
transparency.
While eyebrows may have been
raised on occasions in the past, few
in the region, let alone outsiders, have
questioned time-honoured practices
involving facilitation payments in order
to pursue and conclude business deal-
ings. Insouciance towards sweeteners
and inducements are increasingly chal-
lenged by much tougher legislation,
both within and outside the region.
There has been an increase in
corruption cases in the UAE involving
high-level executives.
Most of the region has now signed
up to international agreements for co-
operation against money laundering
and corruption. The Arab Adminis-
trative Development Organisation’s
conference in Cairo in July had as its
central theme national anti-corruption
strategies and delegates were unani-
mous in calling for the adoption of na-
tional laws to realise good governance
and promote transparency.
The Gulf has been pushed into step-
ping up its fight against financial mal-
practice and bribery, activities that
could destabilise financial systems and
efforts to develop as regional and inter-
national financial centres, as well as at-
tract foreign direct investment.
The intent has been declared but there
is a long hard road ahead. The 2008 Cor-
ruption Perceptions Index, published
by Transparency International (TI), had
13 countries in the Middle East and
North Africa region scoring below five
points and only five countries scoring
above five. The Berlin-based organisa-
tion says that points awarded below
five should give cause for concern.
Yemen is given just 2.1 points while
right at the bottom of the nations list,
Iran rates a dismal a 1.8 points, barely
above Afghanistan with 1.3 points and
Somalia with 1.1. The good guys in
comparison are New Zealand with a 9.4
score, Sweden with 9.2 and Germany
with 8 points.
TI’s latest 2009 index records some
improvement within the GCC. Bahrain
hits the mark with 5.1, Oman 5.5, the
UAE 6.5 and Qatar 7. However, Saudi
Arabia still only records 4.3 points out
THE BUSINESS CORRUPTION

August 2010 gulfbusiness.com 63

THE BUSINESS CORRUPTION
of a possible 10 and Kuwait just 4.1. The
absence of transparency in accounts
and decision-making in particular,
encourages a perception of corruption
in the executive branch. Government
procurement remains an area of
concern, TI concludes.
Saudi Arabia has formed a General
The Gulf has been pushed into
stepping up its fight against financial
malpractice and bribery.
Auditing Bureau as a watchdog over
public funds following criticism by the
kingdom’s consultative council (Maj-
lis al-Shura) that some $30 billion has
been wasted or misappropriated.
In 2007, Saudi Arabia’s King Abdullah
approved a “national strategy to protect
honesty and combat corruption”. Crit-
ics observe that the kingdom’s main
weakness is its lack of accountabil-
ity and transparency with the ruling
family controlling virtually all-state
income, mostly from crude oil sales.
Bahrain’s King Hamad recently ap-
proved legislation designed to combat
corruption in government, nearly eight
years after the measure was originally
proposed in the National Assembly.
Senior officials will now be required
to disclose their wealth, including min-
isters, senior civil servants, heads of
Bahraini diplomatic missions, members
64 gulfbusiness.com August 2010
of the judiciary and governors, as well
as members of the National Assembly.
Any convicted officials will be forced
to return illegally obtained funds and
barred from public office.
The move follows the removal from
office of Minister of State Mansour Bin
Rajab in March after an investigation
by the island’s anti-money launder-
ing directorate involving sums up to
$30 million. He is the highest-ranking
Bahraini official ever to be charged
with corruption.
Oman has seen several high-rank-
ing government officials and a mem-
ber of the State Council successfully
prosecuted in recent years. Kuwait
though has seen no conviction for
bribery in almost 20 years.
This does not indicate an unblem-
ished record and the emirate is set to
adopt new laws to promote transpar-
ency, and strength its battle against
corruption with a proposed Public
Authority for Integrity (PAI). Accord-
ing to Salah Al Ghazali, chairman of
the Kuwait Transparency Society, the
formation of the PAI results from a
merger of four separate pieces of leg-
islation, including the anti-corruption
law, the fiscal stability law, the con-
flict of interest law and the informant
protection law.
Qatar, along with others in the Gulf,
has ratified the UN Convention for
Combating Corruption and has also
established a National Committee for
Integrity and Transparency. However,
the emirate still has no independent
auditing body outside of the executive.
There has been an increase in cor-
ruption cases in the UAE involving
high-level executives, including local
citizens, which has seen a strength-
ening of the country’s Financial Audit
Department.
In 2008, Dubai set up a special task-
force to investigate alleged corruption.
Several senior executive were detained
and several major companies were
caught up in the investigations. Nasser
al-Naimi, director-general of the UAE
Ministry of Interior office is clear that
“it is financial crimes that are the big
challenge ahead.”
Increasingly offences are being
made public as financial monitoring
intensifies. The chairman of the State
Auditing Court, Hareb Al Amini, says:
“We are pursuing our monitoring with
the support of the supreme authori-
ties. We will exert strenuous efforts to
preserve public funds in line with the
intensified measures undertaken by the
UAE to combat all forms of corruption
and other financial offences.”

However, it remains to be seen wheth-
er the various initiatives undertaken
and promised in the Gulf are genuinely
down to an increased political will to
fight corruption, or are largely window
dressing to assuage domestic criticism
and the adverse perceptions harboured
by foreign trading partners.
What is certain is that malpractices
involving foreign companies are un-
likely to go undetected in the future.
A new UK Bribery Act became law in
April making it easier for large compa-
nies to be prosecuted. Until recently,
UK prosecution authorities have been
seen as considerably less pro-active
than their US counterparts who have
frequently investigated and prosecut-
ed offences under America’s Foreign
Corrupt Practices Act.
The scope of the new UK law is de-
liberately broad and applies not only
to cash inducements, but also to gifts
and other advantages. No exception is
made for small facilitation payments
paid to officials to smooth relevant of-
ficial actions. No matter how small or
routine, or expected by local customs,
they would be illegal.
The act also has extra territorial
jurisdiction. International law firm
Norton Rose, believes that extra ter-
THE BUSINESS CORRUPTION
ritoriality in matters relating to finan-
cial crime will become increasingly
common throughout the world as time
passes. A spokesperson said “It is im-
portant to ensure that the third party
is aware of and commits itself, to the
anti-bribery policies of the principal.”
Legal experts believe that any com-
pany not actively examining the his-
tory of its third-party relationships
to determine exposure to bribery and
corruption will have significant dif-
ficulties in being able to demonstrate
compliance with the new law.
The legislation is widely seen as a
reaction to the controversy surround-
ing BAE Systems’ Al Yamamah mili-
tary aircraft deal with Saudi Arabia
and subsequent intervention by the
country’s Attorney General to drop a
prosecution against the company for
reasons of “national interest”. BAE
subsequently agreed to pay fines total-
ling $450 million.
Over the last 20 years, Al Yamamah
is estimated to have brought in $65
billion in revenue for BAE. Reports
suggest that $10 billion may have been
distributed in corrupt commissions
via a web of agents and middlemen
inflating the price of military aircraft
supplied by more than 30 per cent.
UK sub-contractors for engines,
weapons and electronics are also said
to have been required to pay commis-
sions, with payments made via an
anonymous BAE offshore company
known as Poseidon based in the Brit-
ish Virgin Islands, as well as other
Panama–based companies.
The vastness of the BAE Al Yamamah
deal and the lurid allegations of
bribery and corruption surrounding
it have never drawn any detailed
official response, though the former
Saudi ambassador to the US, Prince
Bandar, described them as “grotesque
in their absurdity”.
The truth about arms deals is al-
most impossible to unravel, but
large scale contracts, even those in-
volving sensitive areas such as de-
fence, are likely to come under much
greater scrutiny. The Arab world is
unlikely to be able to ignore corrup-
tion in the future.
Nevertheless, anti-corruption poli-
cies will only work effectively if
backed and implemented by legal
measures and a fully independent
judicial system able and willing to
address corruption wherever it ema-
nates, including the top echelons of
government. ■ gb@motivate.ae
August 2010 gulfbusiness.com 65
THE PEOPLE RONALDO MOUCHAWAR
Market trader
Souq.com chief executive officer, Ronaldo Mouchawar, loves using his start-up to
help others kick-start their own businesses, ZARINA KHAN reports.
B
eing an entrepreneur is a
rather demanding job. But
when your young business
is an online start-up and
your portal is one of the Arab world’s
liveliest e-commerce sites, it becomes
a job that never switches off. So
it’s no surprise then that Ronaldo
Mouchawar, chief executive officer
and co-founder of Souq.com – the
region’s major online shopping and
delivery service platform – is a man
with a lot on his mind.
Moucharwar is at the crossroads
of small and medium enterprises,
evolving technology, social media and
economic empowerment, and to keep
up with it all he is the kind of man
with a laptop open, a smartphone on
at all times and an iPad on order. It’s
not what the energetic Syrian expected
himself to be doing when he first
went to university in the US to study
computer engineering. But right now,
it’s exactly where he wants to be.
“I think the internet is amazing! So
many companies come out of nowhere
and create valuable space out of
nothing – like the Twitters of the world.
That’s the model and the creativity
and interaction that excites me,”
Mouchawar said from Souq.com’s new
Dubai Media City offices.
The self-declared internet-lover
had been working as a technical and
systems consultant for EDS when he
decided it was time to do more. He had
always been attracted to computers,
the internet and business.
66 gulfbusiness.com August 2010
With his Master’s degree in Digital
Communications, a Bachelor’s degree
in Electrical and Computer Engineering
and quite a few years of experience
in the corporate world, Mouchawar
decided to move back to the Middle
East and put some of his many ideas
into practice. The concept of an online
auction site attracted interest, and in
2005 Souq.com was launched.
But the basic online auction site
didn’t seem to be enough. Mouchawar
and his team soon realised that one-
dimensional platform was too basic
and too easy. The market had greater
demands, and the technology allowed
for far more. Soon Souq.com was made
into more of an e-commerce site, and
since then the portal has evolved even
further and is something like the Arab
world’s eBay.com.
So many companies come out of
nowhere and create valuable space out of
nothing – like the Twitters of the world.
“We started with the internet
auction platform and then moved
on to fixed price selling, we added
stores to cater to businesses, a motor
vertical for dealers and users to shop
for cars and a property section. Also,
with that sheer volume of traffic we
have attracted advertising as well.
These are all like separate businesses
now,” he explained.
Only a year after the UAE and
Jordan portal launch, Souq.com was
expanded into the Saudi market to
cater to the e-commerce needs of the
Gulf’s largest country.
Souq’s Saudi platform took the
unique needs of the Saudi population
into consideration, with Arabic as its
standard language, Arabic customer
relations managers and a local team in
Saudi driving the business.
Another year later, a special section
on the site called Souq Motors debuted
in the region following the runaway
success of the original site’s ‘Cars,
Motorcycles and Boats’ area. Going
beyond the standard Souq.com listing
style, Souq Motors was the first Middle
Eastern car portal to offer the Best
Offer option, which is an online version
of bargaining.
And two years on from then, in April
2010, Souq.com became the first online
marketplace to launch in the Arab
world’s most populous country, Egypt.
Despite worries that the less-developed
Egyptian market would struggle to
understand and capitalise on the
e-commerce site, it has already had
positive responses.
“We’re doing great. Egypt was a new
area of geographic expansion for us
but it’s exceeded our expectations,
particularly regarding market
readiness. We tend to think of the Gulf
July 2010 gulfbusiness.com 67
THE PEOPLE RONALDO MOUCHAWAR

as being unusual for the Middle East

in its uptake of e-commerce. But with
Egypt we’ve seen population also plays
a role. In Egypt, Souq.com is a business
enabler – particularly for small and
medium-sized enterprises. There has
been a big uptake in that area,” the
Souq.com CEO told Gulf Business.
It is the growth and development
of Souq.com that Mouchawar finds
most exciting, and that is why he is
still happily part of the portal when
many other online entrepreneurs –
like partners Maktoob – would have
sold it on years ago. Mouchawar said
when Yahoo expressed interest in
buying Maktoob in 2009, he knew his
Souq.com site had not yet reached its
potential and needed to grow.
Not being included in the Yahoo deal
– perhaps the biggest international
sale of an Arab portal, and a huge
measure of their ‘arrival’ on the global
internet scene – was mutually agreed
upon. Souq.com stayed with the Jabbar
Internet Group and Mouchawar has
continued to grow and evolve the site.
“For me, the motivation is very
basic – it comes from our users, the
members. When we talk to our sellers,
you get into what they’re doing, their
business, and ideas on how we can
help them grow. I can’t help but get a
shot of adrenaline from it. Just one of
those interactions has me buzzing for
days,” he said.
The portal has made careers,
changed lives and earned livelihoods
for uncounted thousands since its
launch. In a region where getting
approval and setting up a distribution
network is difficult, if not impossible,
for many entrepreneurs, Souq.com has
been able to simplify the process and
turn dreamers into businesspeople
practically overnight.
“When we launched in the UAE, only
about two per cent of people shopped
on the internet. People said Souq.com
wouldn’t succeed in that kind of reality.
But I thought the opposite. I believed
if we built the right platform people
would use it. There are so many small
and medium business owners and
entrepreneurs – and such a need for job

68 gulfbusiness.com August 2010


The recession has actually helped us.
There was a big need in the market for
this kind of platform and service.
creation – and yet it’s actually pretty
hard to get a business started in lots
of Gulf countries. There are licensing
issues, costs, logistics, etc. But with
Souq.com, we make it easy. It’s an
enabler of business,” he explained with
visible pride.
That unique position – effectively
serving as a business facilitator in
developing markets – also helped the
site survive the economic shocks seen
across the world and even grow its
user base.
THE PEOPLE RONALDO MOUCHAWAR
“The recession has actually helped
us. There was a big need in the market
for this kind of platform and service.
Souq.com had 55,000 unique sellers
in 2009. That is like 55,000 jobs if
you understand that sales provide
livelihoods. But with Souq.com, it’s
done with a far lower start-up cost,
far less investment from our sellers, so
it is easier.
“The good thing is we only make
money on the seller’s success. If they
sell, we profit. If they don’t, we don’t.
It’s a zero cost for set up. They don’t
have to start with an investment in us,”
Mouchawar explained.
How to attract more users, improve
user experiences, expand into more
markets, and improve the quality,
security and accessibility of Souq.
com’s services are constant challenges
for the team.
“My pipeline of ideas for Souq.com is
so full, we will probably never do them
all. But that’s not necessarily a bad
thing. You try things, see what works,
what doesn’t. It’s a constant process.
The success is what drives you. It never
ends. I am a person who always looks
ahead. I am never satisfied with what I
have. Once we have something done, we
have to ask what’s next. What can we
do better?”
Which is why Mouchawar sees
himself being indefinitely occupied
with the Souq.com brand. He believes
every market in the Arab world can
stand to benefit from its platform
and services and there are many
more areas to expand into and more
innovations to offer.
“Our group goal with Jabbar is to
be the first $1billion Arab internet
company and we want Souq.com to be
part of that milestone. We as a group
are more focused on the e-commerce
industry in the region. At this stage,
we want to grow these businesses.
We want Souq.com to be part of every
Arab internet user’s day.
“We are excited to be part of the
shift we’re seeing into e-commerce
in the region. The bottom line is the
more users, the more they fuel the
business. It’s not a one-to-many
proposition; it’s many-to-many, which
is why they’re crucial.”
It would seem then that the CEO and
Souq.com cheerleader-in-chief will not
be arranging a Maktoob-esque sell off
any time soon.
“A business like Souq.com, it
becomes part of your personality. It’s
on all the time and so are you. I almost
can’t remember what I did before it
and I am not sure what I will do after.”
And that suits Mouchawar just fine. ■
gb@motivate.ae
August 2010 gulfbusiness.com 69
THE PEOPLE EXECUTIVE MOVES
Standard Chartered
Bank has announced the Unilever, one of the world’s
appointment of Taimoor leading Fast Moving
Labib as managing director Consumer Goods (FMCG)
and head of private equity companies has announced
for the Middle East, North the appointment of Yasser
Africa and Turkey region. The Joharji as managing
appointment comes as part of director for the Unilever
the bank’s strategic plan to tap KSA Business Unit. Joharji
into the promising regional will build on his experience
private equity market. handling all of Unilever’s
Labib will be heading leading brands. He will
a team that will focus on continue to be based in
investing in mid-to-late stage companies across sectors Unilever House Jeddah,
with proven growth-oriented business models, positive Saudi Arabia.
net cash flow and earnings generation; backed by highly
capable and trustworthy management teams.
Labib brings to Standard Chartered over 13 years of direct
private equity and mergers and acquisitions experience across
a wide range of industries and geographies. James Young has been
appointed as general
manager of Crowne Plaza
Sabre Airline Solutions, the leading provider of technology Dubai, having transferred
solutions for the airline industry has made several from Crowne Plaza Abu
appointments to its senior management team, following Dhabi. Young has more than
a period of significant growth. Sanjay Nanda will join 20 years experience in the
the company as senior vice president of Consulting and industry and started his
Solutions Delivery. In this role, Nanda will oversee the career at the InterContinental
implementation and delivery of all Airline Solution projects Park Lane in London, UK.
including the migration of LAN, AeroMexico and Volaris Since then, he has worked
onto the SabreSonic Customer Sales and Service (CSS) in several different countries
reservation suite. Nanda was previously at McKinsey & in Europe.
Company and prior to that The Boston Consulting Group.

Novotel & Ibis World Trade Khalifa University of Science, Technology and Research
Centre Dubai is delighted to (Kustar) announced that Prof Chelsea White has joined its
announce the appointment team as the department chair, Industrial Systems Engineering
of Christopher McFall and director of the Logistics Institute. In his new role, Prof
as director of sales and White will help establish the curriculum for Kustar’s Systems
marketing. McFall will be Engineering programme and recruit systems engineering faculty
directly in charge of sales, members. He will also be providing leadership for the Logistics
marketing, public relations Institute, as well as support in the enrollment of personnel. He
and reservation functions for will be based at the University’s Abu Dhabi campus.
both hotels. McFall gained
operational experience in Mark Silagy joins the Sabre Airline Solutions team as
food and beverage in Thailand senior vice president of Customer Care and Support. In this
with Meridien, in South Africa with InterContinental Hotels role, Silagy will be responsible for managing and enhancing
and in the United States with Hilton Hotels. all aspects of the airline customer experience from sales
support through to day-to-day operations. A Sabre veteran,
Silagy was most recently senior vice president of Service
Rezidor Hotel Group has appointed Ersin Manaz as and Operations Solutions for Sabre Travel Network where
director of sales. Manaz has almost 15 years experience in he led global customer service and support, business
the hospitality industry. He will drive business on the back process consulting, and infrastructure and technology
of the company profile within the region, raising brand support. Prior to that he held numerous roles at Sabre and
awareness within the market. also spent 12 years with American Airlines.

At Gulf Business we try to keep you up to date on the region’s movers and shakers. If you know of any new faces or company reshuffles, please write to The Editor, Gulf
Business, Motivate Publishing, PO Box 2331, Dubai, UAE; fax to +971 4 2827593; or send an email to theresa@motivate.ae. We reserve the right to edit material.

70 gulfbusiness.com August 2010


WIN A TWO-NIGHT STAY AT
ZIGHY BAY RESORT IN OMAN
S
ix Senses Hideaway Zighy
Bay is located on a headland
on the northern Musandam
Peninsula in the Sultanate
of Oman. It is set between dramatic
mountains to the rear and a broad
sandy beach in front.
Zighy Bay is located 120 kilometres,
or less than a two–hour drive from
Dubai International Airport.
The peninsula’s rugged mountains,
which rise up to 2,100 metres above
the coast and jut into the Strait of
Hormuz, have a spectacular fjord-like
look. It is no wonder that Musandam
is also called “The Norway of the
Middle East”.
The site of the Six Senses Hideaway
Zighy Bay is a secluded fishing
village, with villa accommodation and
a private marina located between the
mountains and the beach.
Guests have the choice of three
arrival experiences: a scenic 15-minute
THE LIFESTYLE COMPETITION
T H E P R I Z E
Two-night stay in a poolside villa,
with full-board, at the Zighy Bay
resort, anytime before December
20, excluding Eid.
H O W T O W I N:
The Question
Six Senses Hideaway Zighy Bay
is located in:
a) Salalah, Oman
b) Liwa Oasis, Abu Dhabi,
c) Musandam Peninsula, Oman.
Terms and conditions:
t
5IF
WPVDIFS
DBOOPU
CF
SFEFFNFE
JO
DBTI


PS
XJUI
BOZ
PUIFS
QSPNPUJPO
PS
EJTDPVOU
t
3FTFSWBUJPOT
BSF
SFRVJSFE
BOE
TVCKFDU

UP
BWBJMBCJMJUZ
1MFBTF
QSFTFOU
UIF
PSJHJOBM

DFSUJmDBUF
VQPO
BSSJWBM
To enter, log onto www.motivatepublishing.com/
competitions and answer the question.
speedboat trip; a winding drive
down from the hilltop overlooking
the bay; or travel as a companion
passenger with the resort’s
professional paraglider.
A private butler service has been
designed to create a unique concept for
villa guests from arrival to departure.
Six Senses Hideaway Zighy Bay
is managed by Six Senses Resorts
& Spas, who have developed and
operated unique properties in the
Maldives, Oman, Thailand, Vietnam,
Spain, Fiji and Jordan.
The Six Senses core purpose is: “To
create innovative and enlightening
experiences that rejuvenate our
guests’ love of the slow life.”
The development has 82 uniquely
designed villas, each with its own
private swimming pool. All villas offer
a spacious, personal environment
with rustic, chic décor and bathrooms
extending to an outdoor shower.
August 2010 gulfbusiness.com 71
F
THE LIFESTYLE TRAVEL
Life’s a
beach
If beach holidays are
your idea of heaven,
then you won’t find
many more idyllic than
Shangri-La’s Villingili
Resort and Spa – the
first luxury resort in
the Maldives south
of the equator.
W
henever you are asked to
picture an idyllic beach
location in your head,
the chances are you will find the
genuine article in the beautiful
Maldives isles.
One heavenly escape is Shangri-
La’s Villingili Resort and Spa, which
is set amidst white sandy beaches,
lush vegetation, 17,000 coconut trees
and towering banyan trees.
Located in a boutique-style
environment, guests can choose from
private ocean retreats to tropical tree
SLEEPS&EATS
Park Hyatt Dubai
DO NOT Deira, Dubai
DISTURB!
The Terrace at the Park Hyatt is a
must-visit for its enchanting views. Enjoy
the glow of sunset while indulging in the
vast selection of premium vodkas or take
advantage of summer offers, including a
free night’s stay when you spend more
than Dhs1,500 in their restaurants.
72 gulfbusiness.com August 2010
house villas with panoramic views.
Situated on a 3km long island, the
resort offers guests the luxury of
space and a range of recreational
activities. Couples can enjoy a
relaxing atmosphere and innovative
treatments at CHI, The Spa, while
children can have fun at the
Adventure Zone. For a memorable
family moment, guests can choose
to explore the neighbouring islands
by bicycle, gather around a barbecue
lunch in the intimacy of their villa,
enjoy a selection of fine dining
options, or participate in the many
waterborne activities available at
the resort.
Set over two separate pavilions
– one for the bedroom and
another for the living room – both
accommodation styles offer a
Armani Ristorante
Armani Hotel, Burj Khalifa,
Dubai
Surely one of the world’s most fashionable
restaurants, Armani’s Ristorante is an
elegant space with a menu to match.
Dress smart, order the saffron risotto then
finish with nougat semifreddo. It will be a
night to remember.
spacious garden, a private infinity
pool and a wooden deck designed for
dining under the stars. The resort’s
Beach Villas, located on the sandy
beach of Villingili, provide direct
access to the turquoise lagoon, while
the Deluxe Pool Villas, nestled in rich
vegetation, offer perfect seclusion and
views of the gentle rolling waves of
the ocean.
In celebration of Eid Ul-Fitr, the
resort is offering a special four-night
stay package valid from September 8
to 18, 2010.
The Eid Ul-Fitr promotion includes
one free night and a range of
complimentary benefits, as well as an
exclusive 25 per cent discount on the
second villa booked, giving guests the
opportunity to enjoy the festivities
with friends and family.
Hakkasan
Emirates Palace, Abu Dhabi
Feeling in the mood for some
upmarket Chinatown goodness? Home
to award-winning chefs and beautifully
lit, Hakkasan puts a chic spin on Chinese
cuisine, with an extra splash of celebrity.
The silver cod in champagne and honey
sauce is a highlight.

Valid for Beach Villa and Deluxe
Pool Villa stays, the resort’s Eid
package starts from $1,050 per night
and includes: one complimentary
night when paying for a minimum of
three nights; return domestic flights
for two from Malé international
airport to the island’s Gan airport;
a scenic 70-minute flight over
the Maldives’ different atolls;
daily breakfast for two in Javvu
Restaurant; and one complimentary
Arabic dinner for two in Dr. Ali’s
Restaurant.
BICE
Hilton Jumeirah Beach, Dubai
This famous Milanese restaurant
is the favourite of many a Dubai dweller,
tempting in lovers of both fine dining and
rustic Italian fare. Starched white linens,
a piano player and superb staff, not to
mention the signature seafood linguine,
keeps the patrons loyal and loving.
THE LIFESTYLE ART
CHARLES POCOCK CANVAS OPINION
Exhibiting the summer’s
attractions
If you are looking to escape from the GCC because of the heat, then there is
an incredible array of events worth seeing in North America and Europe.
Here is a small collection of ‘must-see’ exhibitions for your travels.
At The Museum of Fine Arts in Houston there is Light of the Sufis - the
mystical arts of Islam. Among the outstanding objects on view are late-
19th-century photographs of Sufi dervishes; various examples of kashkuls,
or beggar’s bowls; and the aforementioned manuscripts and album folios
containing Sufi poetry. Contemporary work includes Parviz Tanavoli, Mehmet
Gunyeli, Sevan Bicakçi, Farhad Moshiri and Pouran Jinchi. This exhibition
runs until August 8.
A Gift from the Desert: the Art, History and Culture of the Arabian
Horse will be held from May 29 through October 15 at the Kentucky Horse
Park’s International Museum of the Horse, a Smithsonian affiliate in
Lexington, Kentucky.
This exhibition, presented by the Saudi Arabian Equestrian Federation,
features 400 objects from Egypt, India, Iran, Iraq, Jordan, Qatar, Saudi
Arabia, Syria, Tajikistan and Turkey, many of which have never before left
their native countries, or been on exhibit in the United States.
Exhibition masterpieces include: the 4,500 year-old Standard of Ur,
one of the most famous artefacts in antiquity; the robes and dagger of TE
Lawrence, the British army officer known for his role in the Arab Revolt and
popularised in the 1962 movie Lawrence of Arabia; jewel-encrusted swords
and armour from various Islamic dynasties; the Kikkuli Text, and the oldest
known treatise on horse training, written in cuneiform script on a clay tablet
nearly 3,500 years ago. This exhibition runs until October 15.
In Liverpool, England, at The Bluecoat centre, there is the Arabicity: Such
A Near East exhibition. Six Arab artists have made up an exhibition that is
about representations of the self, projecting and protecting one’s own image
and personal iconography. The exhibition addresses contemporary Arab
concerns, both conceptual and aesthetic. The manner in which the artists
negotiate and mediate between various cultural codes and practices is one
full of warmth, humour and poetry.
The exhibition is made up of works from Palestinian video and sound
artist Basel Abbas and artist/film-maker Ruanne Abou-Rahme, Egyptian-
Armenian artist Chant Avedissian, Lebanese painter and installation artist
Ayman Baalbaki, Sudanese-Egyptian multi-media artist Fathi Hassan and
Palestinian photographer Raeda Saadeh. The show runs until the September
5 and is part of the Liverpool Arabic Arts Festival.
Closer to home is Witness by Mona Hatoum at the Beirut Art Centre.
The exhibition, which follows a five-week residency in Beirut, features
recent work as well as a number of new installations and sculptures
created specifically for the Beirut Art Centre. Witness (2009) (after which
the exhibition is named) is a miniaturised rendition in porcelain of the
monument of the Place des Martyres in the centre of Beirut. Despite being
turned into an ornament, it faithfully reproduces the monument’s mutilation
by the bullets and shells of the civil war that it witnessed.
Works produced in Lebanon present a continuation of Hatoum’s work
in themes taken up by the artist throughout her career, including a new
environment of found objects and furniture that have been transformed
to create a personal interior/exterior landscape. The exhibition runs until
September 9. ■
August 2010 gulfbusiness.com 73
F THE LIFESTYLE LEISURE
Badge of honour?
ALISTAIR CRIGHTON says the 2011 Phaeton is still an enigma
wrapped in a Bentley wrapped in a Passat.
S
o, a return trip for me, after
four years, to the Volkswagen
Phaeton, possibly one of the
strangest cars to ever grace the
roads. And grace is the right word:
after all, this is a technological
marvel – the People’s Car
engineered for people who are very
rich indeed.
It’s still one of the best luxury
cars out there, easily capable of holding
its own against corporate barges from
BMW and Mercedes. But it still sports
that humble VW badge, and, despite
success by expensive offerings such as
the Touareg in lifting the car-maker’s
status, it still looks utterly incongruous
on a car like the Phaeton.
That’s not helped by the styling, of
course, which, as it follows a shared
design brief with other VWs, ends
up resembling a Passat that’s had a
few Bratwurst too many. That’s not to
say it’s not elegant; it has some nice
lines. It just doesn’t have the stylish
sweep of an S series or the brutish
presence of a 7.
MICHAEL GORDON IN THE SWING
Surprise in Open winner and Ryder selection
T
he British Open has been and
gone and while the tournament
was extremely boring to watch,
it did throw up some interesting and
unexpected results.
First and foremost, the winner, Louis
Oosthuizen, was hardly known to
anyone, and even fewer people knew
how to pronounce his name. But not
many will forget the performance the
27-year-old South African delivered at
the home of golf to capture the title.
Oosthuizen blew away the field at St
Andrews, and the über relaxed player
looked as at ease as Tiger Woods did
when he first won the Open a decade
ago. This year Tiger failed to deliver
the return to form many had punted.
He made two double bogeys on his way
74 gulfbusiness.com August 2010
Driving it is an absolute joy. The
technical design brief could have had
the Gulf in mind – a car capable of
travelling 500km in 40 degree heat
at 180 kmph, all while maintaining
the inside temperature at a steady 21
degrees. It works, and extremely well,
with the air conditioning being the
best I’ve used on any car. Performance
is excellent, with, in this model, a 4.2
V8 providing enough power to give the
heavy car enough push, while handling
has to be experienced to be believed:
the laws of physics dictate that hurling
two and a half tonnes of metal into a
corner at speed should be a terrifying,
and probably your final act of stupidity.
to a 72 and tied for 23rd, his seventh
tournament of the year without a win.
Meanwhile, ahead of the European
Ryder Cup in early October, captain
Colin Montgomerie has announced
his selection, which was a surprising
three-man team, made up of Darren
Clarke, Thomas Bjorn and Paul
McGinley. Montgomerie said his vice
captains had the qualities to help the
team regain the trophy from the United
States, making it six wins in the last
eight events. United States captain,
Corey Pavin, has selected four vice
captains in Tom Lehman, Jeff Sluman,
Davis Love and Paul Goydos.
Then in Dubai this month, the
two shortlisted candidates on a
globetrotting golf challenge, the ‘Wear
Not so in the Phaeton, which takes any
bend in its very long stride. This model,
a customised ‘Individual’ has every
extra and gadget fitted: there’s no room
here to list them all, but trust me, if it
isn’t here, it hasn’t been invented yet.
But it’s still hard to see who the
Phaeton is aimed at: a perfect car
for desert dwelling oil barons, that
badge limits its appeal in lands where
bling is king. According to VW, sales
have been OK in Abu Dhabi, which
makes some sense – Abu Dhabians
are renowned for their knowledge of
what makes a good car, and are more
likely to go the anonymous-luxury
route. Even in that regard, however,
the Phaeton is undermined by one
of its own stablemates, the Audi A8,
which does anonymity with a little
more kudos and, at the top end, with
the same V12 engine that powers the
range-topping Phaeton is, impressively,
the Bentley Continental GT and Flying
Spur. So – bargain Bentley or rip-off
Passat? Neither.
By now it’s been around long
enough, and has earned enough of a
reputation to be able to stand its own,
rather idiosyncratic ground. We’ve
come a long way from the Beetle, but
the Phaeton has its own charms, all be
it for an awful lot more money. ■
in the World Adventure’, played an
exhausting 18-holes at Al Badia course
in 48 degree heat. This challenge
covers nine countries in 50 days in a
bid to find a Social Media Catalyst for
Adidas Golf/TaylorMade.
The Adventure is probably one of the
longest running job interviews.
Starting off in Germany on June
26, the finalists, Steve Olsen, 25, and
Chris Dukeminier, 26, made their
way to Norway, the United Kingdom
(Scotland), arriving in the UAE (Dubai
and Abu Dhabi) on July 17 onwards to
Thailand on July 21, then South Korea,
Japan and Canada, culminating in the
finale planned at the Old MacDonald
course at Bandon Dunes, Oregon, USA,
on August 10. ■
 THE LIFESTYLE TECHNOLOGY
Objects of desire
Motorola
Milestone XT720
$tba
You used to be able to divide phones
into four main sub-categories; fashion
phones, music phones, camphones
and smartphones. Now, we demand
that our mobiles be all-in-one super
computers, combining all four
attributes perfectly and without
compromise. In reality, that’s rarely
the case – but Moto’s new Milestone
certainly gives it a go. This touch-
friendly mobile packs a crisp 3.7in
screen, 3.5mm headphone socket,
Wi-Fi, GPS and a proper 8MP camera
with video recording to boot.
www.motorola.com
MB&F Horological
Machine No. 3 Frog
$poa
According to fairytales, if a
girl kisses enough frogs, one
will eventually turn into a
prince and they’ll live happily
ever after. The same is true
for gadget-lovers, the only
difference is that the frog
morphs into one of these
watches. With its goggle-eyed
dials it bears more than a
passing resemblance to our
long-legged amphibian chums.
www.mbandf.com
Canon IXUS 300 HS
$580
Light travels at 299,792,458
metres per second. That’s fast. It
means you need an equally fleet-
footed camera to catch it. Many
compacts just aren’t up to the
job, though – they’re the Wile
E Coyote to light’s Roadrunner.
But Canon’s 10MP IXUS 300 HS
combines a 28mm wideangle
lens with a brand new processor
containing all the ACME-style
tricks needed to snap high speed
shots in gloomy conditions.
www.canon.com
THOMAS SHAMBLER GEEK SPEAK
Five brings web alive
If you stuck your head deep into the
interweb this month, you might have heard
the term HTML5 pop up once or twice. Now,
if you’re anything like me, you will have
probably disregarded that term instantly,
after all, anything with four capital letters
and a number looks like code (and that
stuff’s for geeks).
But HTML5 is worth knowing about, it’s
why Apple abandoned Flash, Google gave up
on Gears – and it might get you to give up
web browsing for good.
Don’t worry, this won’t be a crash course
in coding. Essentially, HTML5 just adds
some new words to the language that
already powers the web. But it’s amazing
what you can do with a few words, audio
and video tags will let music and movies
be embedded without the need for plug-
ins (meaning they will work on mobiles
without destroying your battery). Hence,
Apple’s reluctance to allow Adobe’s Flash
plugins on the iPhone.
And there’s more – combined with
the latest version of styling language
(called CSS3 for you proper tech swots) –
HTML5 will let graphic designers produce
magazine-style layouts with a huge variety
of fonts and controls. In fact, HTML5 will
allow dull website to become juicy web apps
that will even work when you are offline
(which is why Google ditched Gears).
Still with me? Good. To sum up, this
means the days of web browsing are
coming to an end. And in its place you’ll
find full-blown immersion, with your
favourite sites (if they can be called that
anymore) fully customisable, not only in
style but content, too.
But be warned, we’re a few years off
from that. HTML5 support varies between
browsers, and the final spec won’t be
agreed upon by all the big players for a
while. That gives mavericks like Apple
license to add their own features, and that
means a surge of new browsers are soon to
start appearing.
Until then, you’re stuck with a buggy old
version of Internet Explorer. Or, if you’re
really behind the times, an old school (but
nicely designed) magazine that not only
works offline, but in the pool too. ■
Thomas Shambler is the editor of Stuff
Magazine Middle East. thomas@motivate.ae
August 2010 gulfbusiness.com 75
THE ESSENTIALS BOOKS
IT ‘Clouds’:
blue-sky or hot air?
C harles Babcock is something of
an authority on cloud computing,
having been the editor-at-large
for InformationWeek for 20 years,
reporting on the major trends in
computing likes web services,
virtualisation and cloud computing.
He argues that cloud computing
is the “biggest game-changing force
in business since the advent of the
internet”. Key to its success is lowering
and simplifying the cost of operations
while proving flexibility and power.
But for many, cloud computing is as
clear as fog – no more than a buzzword
that few understand. In his book,
entitled Management Strategies for
the Cloud Revolution, Babcock argues
that cloud computing is THE future
and that those that do not embrace it
early will be left behind.
Furthermore, Babcock suggests
that the fact that cloud computing
integrates the latest proven
technologies – such as mainframe
computing and virtualisation –
as well as a number of cultural
changes, proves this truly is leading a
paradigm shift.
In a nutshell, cloud computing
is like renting an IT infrastructure
over the internet over the cost of
developing your own. Babcock
suggests that cloud computing
can dramatically cut costs,
provide ubiquitous access, provide
unprecedented agility and steady
traffic flows.
Although Babcock is an academic,
specialising in information
technology, he is not entirely sold on
the seemingly little fluffy cloud, and
he is quite right to point out that,
right now at least, there are a number
of short-comings. Most worrying is
the issue of security.
76 gulfbusiness.com August 2010
As the book suggests there are
mounting concerns that competitors
could access information stored in
the cloud, and also that information
could be lost all together as end users
are unable to pinpoint exactly where
there data is stored.
This book provides the tools every
manager needs to create a new
business strategy and to harnesses the
power cloud computing has to offer.
Overall this is a well balanced and
informative book that clearly defines
cloud computing and outlines the
impact it is likely to have.
Motivation
over money
H ave you ever felt totally
disinterested in your job? Would
a pay rise solve the problem? Dave
Ulrich argues that ‘throwing money at
the problem’ is not the solution.
In his later book, The Why of
Work, Ulrich argues that employees
are actually motivated more by a
sense of worth, a sense of purpose, or
of contribution. Owning a project is
often more rewarding than the salary.
According to the renowned
management expert, employees who
find meaning in their work are more
competent, committed, and eager to
contribute – and their contribution
will result in increased customer
commitment, which delivers a winning
performance on the bottom line.
Ulrich attempts to prove that
aspirations can be turned into action
through a series of targeted checklists
and questionnaires, amongst other
tools. He believes that by using the
proven principles of abundance, you
can coordinate your needs with those
of your employers, your employees
and your customers, which ensures a
coherent approach to the task in hand.
In these times of economic decline
and uncertainty, it is all the more
important that you get 100 per cent
performance out of employees. Those
that are distracted or disinterested
will de-motivate the entire team. This
book clearly demonstrates how to
empower your employees to ensure
they are totally engaged in their work.
This is an inspirational book, filled
with meaningful and useful anecdotes
and case studies. It will help you
understand what drives you and your
workforce and will ensure you are all
heading in the right direction.
 Invest in the French Riviera
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Panoramic views of the sea, the old city and the

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metres of landscaped gardens of the villa located
on a hillside just 1.5 kilometres from the city centre.
A mirror swimming pool outside and approximately
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two bedroom penthouses feature large terraces
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1,070,000

The Provençal style villa is a private retreat featuring

gardens and terraces overlooking the sea with
additional views of Cap d’Antibes and mountains,
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Located in a peaceful residential area facing the

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To view our full portfolio of exclusive residences 4 Place Du Mal Juin, B.P. 24, 06141, VENCE, FRANCE
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realimmo06@orange.fr
THE ESSENTIALS CALENDAR

Exhibitions, conferences & seminars

Gulf Business presents a comprehensive listing of business-related exhibitions,
conferences, events and seminars in the GCC for the forthcoming month.

EVENT DATE LOCATION ORGANISER

Al Alayam
Family Expo Jul 29-Aug 10 Kuwait International Fair, Kuwait KIF Bahrain on tel: +973-17-725111,
fax: +973-17-723300.
Ramadan Food Exhibition Jul 29-Aug 10 Kuwait International Fair, Kuwait KIF
Alshaam
Kuwait Household Exhibition Jul 29-Aug 13 Kuwait International Fair, Kuwait KIF For Organizing Exhibitions & Festivals,
LLC on tel: +968 24797800/ +968
Certificate in Fast Closing Monthly and 24791502.
Aug 1-4 Dusit Thani Hotel, Dubai IIR
Year End Accounts
DSF (Dubai Shopping Festival)
Budgeting and Budget Control of the HR Function on tel: +9714 600545555.
Aug 1-4 Dusit Thani Hotel, Dubai IIR
Effective Manpower Planning
ECS (Expo Centre Sharjah)
Strategic Information Security Management Aug 1-4 Hyatt Regency Hotel, Dubai IIR on tel: +9716 5770000,
fax: +9716 5770111.
Certificate in Financial Skills for Management Aug 1-4 Hyatt Regency Hotel, Dubai IIR
KIF (Kuwait Int’l Fair)
Advanced Maintenance Masterclass Aug 1-4 Hyatt Regency Hotel, Dubai IIR on tel: +965 5387100,
Advanced Financial Statement Analysis Aug 1-4 Hyatt Regency Hotel, Dubai IIR fax: +965 5393872.

Strategic Marketing Planning Aug 1-4 Hyatt Regency Hotel, Dubai IIR IIR Middle East
on tel: +9714 3365161,
Contracts Management Principles fax: +9714 3352682.
Aug 3-5 Dusit Thani Hotel, Dubai IIR
and Practices Marcus Evans Kuala Lumpur
Successful Energy Management and Auditing Aug 9-11 JW Marriott Hotel, Dubai IIR on tel: +603 27236604,
fax: +603 27236699.
Making Strategy Happen Aug 7-10 JW Marriott Hotel, Dubai IIR
Terrapinn
Human Resources Week Aug 15-19 Hyatt Regency Hotel, Dubai IIR on tel: +44 20 72421548,
fax: +44 20 72421508
Homes Middle East Aug 19-4 Sep Expo Centre Sharjah ECS
Bahrain International Exhibition &
Al Ayam Cultural Fair Sep 14-23 Al Ayam
Convention Centre
The Internet Show Middle East 2010 Sep 21-22 ADNEC Terrapinn
Gulf Business and Motivate Publishing
ADIHEC Sep 22-23 ADNEC Terrapinn accept no responsibility for errors and
omissions, date and location changes or
Social Media World MENA Sep 20-21 ADNEC Terrapinn cancellations.
Please contact the organisers directly for
Shopper Marketing Sep 26-27 Hyatt Regency Hotel, Dubai Marcus Evans further information.

If you are organising or know of an event taking place in the GCC, please send full details to: Exhibitions, Gulf Business, Motivate Publishing, PO Box 2331, Dubai, United Arab Emirates,
or fax to +9714 2827593, or email gb@motivate.ae.

Contracts Management The Ramadan Strategic Marketing

Principles and Practices
To be able to work effectively with
contracting managers, purchasing
professionals and subcontractors,
it is important to have a solid
understanding of the contracting
process. The Contracts Management
Principles and Practices course can
give you an overview of all phases
of contracting, from requirements
development to closeout, and to
see how incentives can be used to
improve contract results – exploring
these vital issues from the project
manager’s perspective.
Food Exhibition Planning
The Ramadan Food Exhibition in Strategic Marketing Planning will
Kuwait is the seasonal centre of help to answer the challenges facing
innovation in food, foodstuffs and your business as a result of financial
beverages. Local and international turmoil, climate change, globalisation
exhibitors not only source the latest of markets, scarcity of natural
products available but can keep resources and rapid technological
abreast of industry trends, future developments. It provides a powerful,
developments and benefit from formalised, market-led planning
networking with key names from methodology to guide and give
all sectors of the food and drink confidence to meet the challenges.
industry. Some of the exhibitors The course is designed for
include supermarkets and multiple managers who have direct or indirect
retailers, delis, convenience stores and responsibility for determining their
independent grocers/retailers. organisation’s marketing strategies.

78 gulfbusiness.com August 2010


AL RAHA BEACH HOTEL
Abu Dhabi
Al Raha Beach Hotel, created to
provide the very best of traditional
Arabian hospitality. This unique jewel
of luxury and tranquility, offering
magnificent services, awaits you for
an unforgettable visit to Abu Dhabi.
Tel 00971 2 50 80 555
Fax 00971 2 50 80 429
PARK ROTANA ABU DHABI
Khalifa Park area, Abu Dhabi
Conveniently located adjacent to Khalifa
Park, the property offers 318 luxurious
rooms and suites, 6 world class dining
venues, 6 meeting rooms and spacious
ballroom with day light access and
outdoor terrace.
Tel 00971 2 6573333
Fax 00971 2 6573000
Email park.hotel@rotana.com
JUMEIRAH EMIRATES TOWERS
Sheikh Zayed Road, Dubai
Jumeirah Emirates Towers is a sleek
architectural masterpiece of steel
and glass. It redefines the business
hotel category, seamlessly combining
form with function, high technology
with unparalleled luxury and elegance
with efficiency.
Tel 00971 4 3300000
www.Jumeriah.com
IS YOUR HOTEL LISTED ON THIS PAGE?
To become one of Gulf Business’ Preferred Hotels and benefit from exposure to the extensive readership of Gulf Business throughout the GCC
SHANGRI-LA
Sheikh Zayed Road, Dubai
Offers 301 luxuriously appointed guest
rooms and suites, nine restaurants and
bars, health club and spa, tennis and
squash courts and outdoor swimming.
Tel 00971 4 3438888
Fax 00971 4 3438886
Email: sldb@shangri-la.com
THE FAIRMONT DUBAI
Sheikh Zayed Road, Dubai
This 394-room hotel boasts 10 dining
and entertainment venues a superb
spa and unrivalled meeting facilities.
Tel 00971 4 3325555
Fax 00971 4 3324555
Email: dubai.reservations@fairmont.com
KEMPINSKI HOTEL MALL OF
THE EMIRATES
Sheikh Zayed Road, Dubai
The truly unique and exciting five stars
hotel features 393 rooms, suites and
chalets together with Mall of the Emirates
shopping centre and Ski Dubai’s alpine
themed indoor snow resort.
Tel 00971 4 3410000
Email reservations.malloftheemirates@
kempinski.com
Website www.kempinski.com/dubai
contact Circulation Department on 00971 4 2052497
Gulf Business magazine is available in all of these GCC hotels
THE ESSENTIALS WHERE TO STAY
LAYIA OAK HOTEL & SUITES
Al-Barsha, Dubai
Offering 161 furnished units ranging
from 81 sqm to 160 sqm, 3 dining
venues, 3 multi-purpose meeting
rooms, recreation facilities & a
majestic landscaped area around the
temperature-controlled pool.
Tel 00 971 4 437 78 88
Fax 00 971 4 437 79 99
Email: welcome.oak@layia.net
TAMANI HOTEL MARINA
Dubai Marina
This hotel boasts 240 units, including
studios, 2 or 3 bedroom units, and
penthouses. There is also one restaurant. a
health club, indoor and outdoor swimming
pools and 5 meeting rooms.
PO Box 215855, Dubai, U.A.E
Tel 00971 4 3992500
Fax 00971 4 3993225
Email sales@tamanimarina.ae
INTERCONTINENTAL DOHA
Doha, Qatar
Situated in the West Bay area, yet
located near the city. With its various
dining options, 24 suites, 234 rooms,
private beach and state-of-the-art
gymnasium, it is an idyllic setting for
business and leisure.
Tel 00974 4844444
Fax 00974 4839555
MEDIA ROTANA DUBAI
Al Barsha South-TECOM
Located in the heart of Dubai’s new
business hub and opposite Dubai Media
City and Internet City the Media Rotana
Dubai has 460 rooms, suites and deluxe
hotel apartments, 5 award winning
dining venues and 15 meeting rooms.
Tel: 00971 4 4350000
Fax: 00971 4 4350011
Email: media.dubai@rotana.com
ACACIA HOTEL
Ras al Khaimah
The Acacia Hotel is a superbly designed
four star hotel complete with Al Nakhla
restaurant, the stylish Flamingo bar, the
vibrant Club Acacia, a pristine pool serving
as a backdrop to varied and exciting
Theme Nights, the luxurious O-Zone Spa,
and high-energy Oxygen Gym.
Tel 00971 7 2434421
Fax 00971 7 2434429
MÖVENPICK HOTEL DOHA
Doha, Qatar
Located on the Corniche Road, opposite
the Museum of Islamic Art, the hotel
offers 154 rooms and suites, a business
centre and meeting rooms. Recreation
facilities are also available.
Tel 00974 4291111
Fax 00974 4291100
www.moevenpick-doha.com
August 2010 gulfbusiness.com
SOFITEL AL HAMRA JEDDAH
Jeddah, Saudi Arabia
The hotel situated in the heart of the
business centre offers 211 rooms, 17
suites and 25 apartments. 5 meeting
rooms and 2 reception rooms to
accommodate up to 350 people.
Tel 00966 2 6602000
Fax 00966 2 6604145
HOLIDAY INN RIYADH, IZDIHAR
Riyadh, Saudi Arabia
The first 5 star Holiday Inn hotel in the
Kingdom, with 289 new and trendy
accommodations, huge lobby with W-Fi
access, outdoor pools, sauna, Jacuzzi
and health club. Also has state-of-the-art
meeting rooms, 24-hour business center
with professional secretarial support.
Tel 00966 1 4505054
Fax 00966 1 4505056
JEDDAH HILTON
Jeddah, Saudi Arabia
Located a 10-minute drive from the
Jeddah International Airport. Offers over
414 rooms including 46 suites. 10th
and 11th floors are Executive floors
addressing all the needs of a modern-
day businessman.
Tel 00966 2 659 0000
Fax 00966 2 658 2489
79
THE ESSENTIALS STATS & FACTS

MERGERMARKET TOP DEALS OF THE MONTH

Deal Value ($m) Bidder Target Deal Description
545 International Petroleum Aabar Investments PJSC International Petroleum Investment Company, the Abu Dhabi sovereign investment vehicle, has
Investment Company launched an offer to acquire out the minority shares in Aabar Investments, the listed Abu Dhabi-based
investment group.
74 Depa Interiors LLC Design Studio Furniture Design Studio Furniture Manufacturer Ltd has signed a definitive agreement to be acquired by Depa
Manufacturer Ltd (75.27% Stake) Limited via a scheme of conditional cash offer.
28 United Industries Company Kuwait National Industrial United Industries Company K.S.C, the Kuwait-based investment holding company having interest in
K.S.C Projects Co. (50% Stake) dairy products, oil, gas and petrochemical sectors, seafood products, paints products and restaurants
management companies, has acquired a 50% stake in Kuwait National Industrial Projects Co, the
Kuwait based company making investments in industrial companies, for a consideration of KWD
8.24m (USD 28.4m).
13 Fawaz Abdulaziz Al Hokair Retail Group Egypt SAE; and Fawaz Abdulaziz Al Hokair Company, the listed Saudi Arabia-based company engaged in retail
Company Retail Group Jordan Co Ltd business consisting of Arabian centers, fashion retail, food & entertainment and real estate, has
acquired Retail Group Jordan Co Ltd and Retail Group Egypt SAE, the Jordan and Egypt-based fashion
retail firms, for a net consideration of SAR 48.32m (USD 12.91m).
7 HCL Infosystems Limited NTS Group (60% Stake) HCL Infosystems Limited, the listed India-based hardware, services and ICT systems integration
company, has acquired 60% stake in NTS Group, the United Arab Emirates-based IT services and
solutions company, for a consideration of USD 6.5m.
5 EFG-Hermes Holding Company Tadawol Securities and EFG-Hermes Holding Company, the listed Egypt-based company engaged in investment banking,
Financial Services securities brokerage, asset management services and a private equity firm, has agreed to acquire
Tadawol Securities and Financial Services, the Jordanian brokerage firm, for a total consideration of
JOD 3.85m (USD 5.47m).

- Investcorp Veritext LLC Investcorp, the Bahrain-based private equity firm, has agreed to acquire Veritext LLC, the US-based
court reporting business which provides integrated deposition and associated litigation activities,
from The Riverside Company, the US-based private equity firms, for an undisclosed consideration.

- MB Holding Company LLC MB Century Drilling Limited Mohamed Al Barwani Holding Company LLC (MB Holding), the Oman-based investment
(49% Stake) holding company engaged in oil and gas exploration, mining and providing drilling services,
has acquired the remaining 49% stake in MB Century Drilling Limited, the Australia-based
provider of oil, gas and geothermal drilling services, from Downer EDI Limited, the listed
Australia-based company engaged in comprehensive engineering and infrastructure
management services, for a undisclosed consideration.
Notes: Deals are based on the geography of target, bidder or vendor being in the Middle East, for the period between June 18, 2010 and July 20, 2010. Based on announced deals, including lapsed and withdrawn
bids. Where deal value is not disclosed, the deal has been entered based on turnover of target exceeding $10 million. Activities excluded from the table include property transactions and restructurings where the
ultimate shareholders’ interests are not changed.

MIDDLE EAST QUARTERLY M&A ACTIVITY MIDDLE EAST ACTIVITY BY INDUSTRY SECTOR YTD 2010  VALUE
FROM 2004 TO JULY 20, 2010
14,000 50 Business Consumer Energy/Mining/ TMT 10%
Services 1% Utilities 5%
Number of deals
Value ($m)

12,000 Value Financial 1% Leisure

Volume 40 Services 7%
10,000 24%
8,000 30
Transport
6,000 20 15%
4,000
10
2,000
0 0 Industrials and Defence Agriculture Real Estate Pharma/Medical/
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2004 2005 2006 2007 2008 2009 2010 Chemicals 15% 1% 1% 17% Biotech 3%

MIDDLE EAST ANNUAL M&A ACTIVITY MIDDLE EAST ACTIVITY BY INDUSTRY SECTOR YTD 2010  VOLUME
FROM 2004 TO JULY 20 , 2010
Transport Pharma/Medical/ Construction Real Estate Agriculture
30,000 200 3% Biotech 3% 1% 9% 1%
Value
25,000 Volume Leisure Defence
150 3% 1%
20,000
Industrials
Number of deals

15,000 100 TMT and

Value ($m)

22% Chemicals
10,000 18%
50
5,000 Energy/
0 0
Mining/ Consumer Business Services Financial Services
2004 2005 2006 2007 2008 2009 2010 Utilities 7% 8% 8% 16%
Mergermarket tracks all M&A deals of more than $5m where the target, bidder or parent is a Middle Eastern company. For further details, call +9714 4376482.

80 gulfbusiness.com August 2010

OUT TO LUNCH GEORGE DABAGHI
TV dinner
ALISTAIR CRIGHTON finds out about the future of television from the man bringing
video on demand to the masses.
T
he world of television, and especially
how we consume it, has changed
immeasurably over the past five
years. Linear TV schedules are an
anachronism these days, with TiVOs and
similar devices putting control firmly in hands
of the viewers, while rendering TV guides
redundant.
While that’s a challenge for the plethora of
terrestrial and satellite broadcasters in the
region, struggling to cope with declining ad
revenues amid ever more competition, it’s been
a golden opportunity for George Dabaghi, the
general manager of video on demand (VoD)
company On Demand Group. On the back of
a deal with Du late last year, the company
George Dabaghi is expanding its unlimited Video on Demand
service in the UAE, so it’s fitting our lunch
is in the Radisson Blu’s Certo, the Italian
restaurant that has long been established as
the power lunch venue of choice for Dubai
Media City’s communications gurus.
On Demand is the content management
subsidiary for SeaChange, a global player in
VoD which last year delivered more than four
billion programmes and movies to TVs, mobile
phones and PC screens. In the UAE alone, VoD
is estimated to grow by more than 65 per cent
by 2012, according to a study by SNL Kagan.
Over fresh-baked bread, Tuscan bean
paste and olive oil, Dabaghi, an electrical
engineering graduate, is careful not to plunge
into too much technobabble when explaining
how the service works, though he still loses
me at times. All customers need to know,
he says, is it does work, and on whatever
platform you want. “We offer content across
platforms,” he says, “Mobile phones, television
and PC, we hook up with content providers.“
So, he’s something of a middle man, I ask. “I
suppose so, but we have strong relationships
with studios, with the TV companies. So we
provide the content at the best rates.”
His company also provides the underlying
technology that allows seamless transition
of content to multiple platforms, he says –
82 gulfbusiness.com August 2010
something that telcos could struggle to do
by themselves. (Rather unfortunately for Du,
however, on the day of our lunch, it announced
its VoD service would be free for subscribers
until September, as a result of a problem
that cut off TV services to a large number of
subscribers).
Over an adventurous choice of Pizzocheri –
buckwheat pasta served with cubed potatoes,
cheese and green beans that would have
an Atkins Diet follower fainting – Dabaghi
explains it’s not just mainstream broadcasters
whose traditional business models will be
challenged by IPTV and VoD. Pirates – the
scourge of the entertainment industry since
the dawn of the internet and cheap DVDs –
will also feel the pressure. “Think about the
Chinese DVD lady,” he says. “She’s charging
Dhs10 for a disc that you probably watch only
once. And you can’t guarantee the quality. VoD
supplies the same service, for the same price,
and is more convenient.”
That convenience factor, Dabaghi says, could
also lure computer users away from torrent
sites such as The Pirate Bay, where advert-free
downloads of all the latest movies and TV
shows are readily available. Those snubbed
advertisers, potentially the hardest hit in an
IP-driven TV world where viewers can simply
skip the ad breaks, will welcome the ability
to “bookend” VoD programmes. It is, says,
Dabaghi, a win-win situation. “Advertisers love
this service,” he says. “It’s got great potential
for them.”
So far, getting Du has been the biggest
success in the Middle East for London-based
On Demand. But, over espressos, Dabaghi
admits the UAE’s population is something of a
limiting factor, and, for future growth explains
he’s in talks with broadcasters and mobile
phone operators throughout the region. “Saudi
Arabia and Egypt are the real prizes,” he says.
A history buff in his spare time – with his
native Lebanon being a specialist subject – in
his working life, it seems, Dabaghi’s eyes are
firmly on the future. ■
 Rolls-Royce
Like nothing else on earth

A unique presence in every form. Effortless acceleration

with power in reserve. Space to experience inner calm.
Each created by masters of their crafts. When a Rolls-Royce
drives by the world stands still.

Abu Dhabi Motors, Abu Dhabi, UAE Al Jenaibi Int’l Automobiles LLC, Muscat, Oman
Tel: 00971 2 677 8884 www.rolls-roycemotorcars-dealer.com/abudhabi Tel: 00968 2 456 7108 www.rolls-royceoman.com

AGMC, Dubai, UAE Ali Alghanim & Sons Automotive Co. WLL, Kuwait
Tel: 00971 4 339 1555 www.rolls-roycemotorcars-dealer.com/dubai Tel: 00965 184 6464 www.rolls-roycemotorcars-dealer.com/kuwait

Rolls-Royce Motor Cars Doha, Doha, Qatar Mohamed Yousuf Naghi Motors, Jeddah, Kingdom of Saudi Arabia
Tel: 00974 447 7577 www.rolls-roycemotorcars-dealer.com/doha Tel: 00966 2 669 5333 www.rolls-roycemotorcars-dealer.com/saudiarabia

Euro Motors, Manama, Kingdom of Bahrain Mohamed Yousuf Naghi Motors, Riyadh, Kingdom of Saudi Arabia
Tel: 00973 17 754 754 www.rolls-roycemotorcars-dealer.com/bahrain Tel: 00966 1 462 7777 www.rolls-roycemotorcars-dealer.com/saudiarabia

Every Rolls-Royce Motor Car is provided with a four year unlimited

mileage warranty and service package*. Terms and conditions apply**.
Full details can be obtained from an Authorised Rolls-Royce Motor
Cars dealership.

www.rolls-roycemotorcars.com
* If the motor car is used for commercial purposes (chauffeur service, limo service, hire car, hotels etc.) the warranty period is 48 months or 100,000 miles (160,000 km), whichever occurs first.
** Rolls-Royce Motor Cars Parts warranty is 24 months / unlimited mileage from the date of purchase.
© Copyright Rolls-Royce Motor Cars Limited 2010. The Rolls-Royce name and logo are registered trademarks.