A number of developers in Dubai are announcing easy payments plans to attract and hold on to buyers, as property market worries intensify across the globe. Emaar Properties yesterday officially announced it will launch two schemes, of which the first extends property payments over five years after handover and the second allows buyers to rent a property before deciding whether to purchase it or not. « The ‘Plan to Own’ and ‘Rent to Own’ programmes are aimed at further strengthening the property sector by facilitating easier purchases and making property more affordable for our customers, » Issam Galadari, Chief Executive Officer, Emaar Properties, said. Another developer, Union Properties, said it has eased payment terms on two of its real estate projects – Index and Limestone House in Dubai International Financial Centre. « We are altering the payment terms in these two developments as we do not expect someone to walk in with the full 65 per cent required before hand over in today’s market conditions, » Zaid Ghoul, Chief Financial Officer, Union Properties, told Emirates Business. ETA Star Property Developers is open to talks with potential buyers and will offer tailor-made payment plans in some of its units, said Shyam Sunder, General Manager, Marketing, ETA Star. New regulation Off-plan buyers wishing to halt purchases will have to obtain a cancellation notification from the developer and forfeit 30 per cent of the total value of the units. The announcement by the Dubai Land Department is intended to deter speculation in the property market. By Parag Deulgaonkar business24-7.ae
MANAMA: Bahrain took part in the World Travel Market (WTM) which began in London yesterday. The participation of Bahrain came as part of efforts to attract tourists through this grand international event which brings together 5,000 tourism and airline companies and travel services suppliers. Information Ministry tourism promotion and marketing project chief executive Mohammed Nass affirmed the importance of Bahrain’s participation in the event. Tourism sector marketing head Bader Nasser said Bahrain was one of the first Gulf countries to take part in the WTM for 20 years. Sabic profit warning RIYADH: Saudi Basic Industries Corporation (Sabic) said yesterday it expects fourth-quarter earnings to be hit by a rapid slide in prices and a slowdown in demand due to the global financial crisis. « The prices curve nosedived from September 1 to today. Prices of polypropylene and polyethylene for instance were above $2,000, now they are below $1,000, » chief executive Mohamed Al Mady said. Rio to review plan DUBAI: Rio Tinto Alcan said yesterday it will review a $10.6 billion aluminium joint venture with Saudi firm Maaden, and sources close to the project said it could be delayed by one or two years. « We are looking at the technical and financial feasibility of all our projects, this is not unique to Maaden, » the source said at an industry conference here. gulf-daily-news.com
MUSCAT — His Majesty Sultan Qaboos bin Said will preside over the annual meeting of the Council of Oman at the council hall in Al Khuwair today. His Majesty the Sultan will deliver a speech in which he will review the progress of the development projects being implemented, their features and horizons in realising a solid growth that enhances security and stability of the nation. The session will be attended by members of the Royal family, the chairmen of the State Council and Majlis Al Shura, ministers, advisers, the inspector-general of police and customs, the head of the Internal Security Service, the chief of staff of the Sultan’s Armed Forces (SAF), the SAF corps commanders, members of the State Council and Majlis Al Shura, heads of diplomatic corps in the Sultanate, a number of sheikhs and dignitaries, editors-in-chief of Oman News Agency (ONA), local newspapers and delegates of Arab and foreign media. The Council of Oman was set up by Royal Decree No. 86/97, issued on December 16, 1997, and comprised the State Council and Majlis Al Shura. The Basic Law of the State determines its prerogatives, terms, settings, regulations, number of their members, membership conditions, the methods of selecting or appointing them and causes of their dismissal among other regulations. ONA timesofoman.com
KUWAIT: Most Gulf share markets dropped for the second straight day yesterday as a strong rebound in Asian stocks failed to offset anxieties about the regional economy. Only the Omani market was up slightly, while the other five bourses dipped as investors appeared to take the view that the global crisis may have a deeper impact on the oil-rich Gulf states than initially thought. Furthermore, the meeting, which was attended by the finance and commerce ministers and governor of the Central Bank, was informed that Kuwaiti foreign investments have been affected by the global crisis. Secretary of the financial committee MP Ahmad Lari said « the impact on our investments has been less than others ». He also added that the Central Bank has already pumped funds into the banks and made some deposits in order to help them cope with the crisis. Global General Index (GGI) ended the session down by 4.05 points (-1.62 percent) to close at 246.33 points. The Kuwait Stock Exchange Price Index dropped 148.10 points (-1.57 percent), to close at 9,256.30 points. Market capitalization went down by 1.62 percent to reach KD39.53bn during the day. During yesterday’s session, market breadth was skewed toward decliners as 95 stocks retreated, while 22 gained and 83 stocks remained unchanged. A total of 131 stocks were traded yesterday. Volume and value of shares traded on the exchange ended the day on a negative note, as investors exchanged 130.08mn shares (-14.47 percent), at a total traded value of KD51.08mn (-17.03 percent). The Investment Sector was the volume leader, accounting for 27.81 percent (36.18mn) of total volume. This was due to Ekttitab Holding Company which has been the volume leader for two days in a row with 12.16mn shares exchanged. The stock ended the day up by 5.10 percent at 93fils. Furthermore, Banking Sector was the value leader with a total traded value of KD20.42mn. The sector was backed by Kuwait Finance House which has been also was the value leader for two days in a row with a total traded value of KD11.68mn. In addition, the scrip was unchanged for the day to stay at KD1.640. It is worth mentioning that Global Banking Sector has decreased by 29.28 percent since the beginning of the year. Moreover, the Governor of the Central Bank of Kuwait (CBK) Sheikh Salem Abdulaziz Al-Sabah said yesterday that all indicators showed that Kuwait’s banking sector enjoyed high profitability, abundant liquidity and sound solvency. On the other hand, total transactions for the day decreased by 19.09 percent to reach 3,273 deals. Hits Telecom Holding was the top gainer for the day, adding 7.14 percent to close at 375fils. On the other side, National Industries Company for Building Materials was the biggest loser, as its share price declined by 10.39 percent to close at 345fils. Sector-wise, all the indices went down yesterday, except for Global Insurance Index adding 0.15 percent to close at 61.07 points. It is worth mentioning that Wethaq Takaful Insurance was the only gainer in the sector, which increased by 4.35 percent to clos e at 144fils. On the other side, Global Real Estate Index was the top decliner for the day shedding 3.85 percent to reach 91.84 points. The index’s drop was caused by heavyweights Al-Mazaya Holding Company and Mabanee Company dropping 8.33 and 6.33 percent, respectively. Global Industrial Index was the second biggest decliner shedding 3.38 percent to reach 236.30 points. This was a result of National Industries Group (Holding) which decreased by 6.73 percent to close at 485fils. During today’s session, all the Global Special indices ended the day on a negative note, with Global High Yield Index being the biggest decliner shedding 2.95 percent to close at 226.81 points. Global Islamic Index was next, dropping 1.98 percent to close at 851.34 points. kuwaittimes.net
Fujairah: The UAE faces a slowdown in loan growth and real estate activity as it grapples with the fallout of the global financial crisis, policymakers said. States in the world’s biggest oil-exporting region are expecting the global problems to put the brakes on a regional econ-omic boom supported by six years of high oil prices. But Gulf economies sitting on surplus oil revenues would continue to post growth as they push ahead with a monetary union plan that has gained momentum during the financial turmoil, UAE Central Bank Governor Sultan Nasser Al Suwaidi said. « The slowdown will be imposed on us… in everything we will see contractions, » he told reporters on the sidelines of a meeting in Fujairah, one of seven emirates in the UAE federation. « But I think we will still be growing in all directions in a very comfortable way. » His comments echoed those of Mohammad Al Abbar, chairman of Dubai-based Emaar Properties, who said growth in the emirate’s real estate sector could slow to 9 per cent from 13 per cent due to the global downturn. The global crisis could bring Gulf Cooperation Council (GCC) members closer together as five of them, including Saudi Arabia, strive to launch a single currency by a 2010 deadline that had been derailed for years, Al Suwaidi said. The UAE, which pegs its currency to the dollar, opted not to track the latest US interest rate cut, he said. The UAE’s benchmark overnight repurchase rate was left at 1.5 per cent after the 50-basis-point US cut on October 29. By contrast, the Kuwaiti benchmark is 4.5 per cent and Saudi Arabia’s is 4 per cent. « Coordination and cooperation with GCC countries is very important and [their rates] are way above us. We didn’t want to create a bigger gap, » he said. Speaking of the effect of the financial crisis on monetary union, he said: « I would say it gives us more enthusiasm and more energy to push forward to achieve monetary union. » Prior to releasing Gulf notes and coins, Gulf states could set the terms of a numerical currency « at any time », he said. Reuters
Qatar Airways (QA) said yesterday it has secured a $500 million (Dh1,836m) 12-year finance lease from BNP Paribas, Bank of Tokyo-Mitsubishi, Deutsche Bank, Standard Chartered Bank and Sumitomo Mitsui Banking Corporation Europe for the purchase of three Boeing 777 aircraft. The aircraft are scheduled for delivery by the year-end, the Doha-based carrier said in a statement. « The closing of this deal at a time of extreme liquidity stress in the international banking markets was a testament to close co-operation between Qatar Airways and the lending group, » it said, adding Qatar Airways is enjoying the trust of large financial institutions. « This financial arrangement shows the confidence international lenders have in Qatar Airways as an airline with a strong vision to grow its international network and strengthen its market presence, » said Qatar Airways’ Chief Executive Akbar Al Baker. With Standard Chartered Bank acting as facility agent and security trustee for the deal, the financing structure ensures the deal financed – 100 per cent of the purchase cost of the aircraft – achieves a loan to aircraft value profile, which would meet the requirements of international aviation finance banks while also appealing to regional lenders, it said. Qatar Airways currently operates 64 Airbus and Boeing aircraft from its Doha hub to 83 destinations across Europe, Middle East, Africa, South Asia, Far East and North America. The carrier’s current order comprises orders for 80 Airbus A350s, 60 Boeing 787s and 32 Boeing 777s, with deliveries of the latter having started in November 2007. Qatar Airways is also a customer of the superjumbo Airbus A380 with five aircraft on order, scheduled for delivery from 2012. business24-7.ae
It’s big in every sense of the word – a vast retail temple of glass and marble stretching over the equivalent of 50 football fields. Complete with one of the world’s biggest indoor aquariums, an Olympic-sized ice rink and one of the largest cinemas in the Middle East, The Dubai Mall is a landmark like no other. The UAE’s latest attraction at the foot of the world’s tallest building has more than 3.77million sq ft of retail space and will be home to 1,200 stores once fully complete. Star retailers include the 55,300 sq ft chain of high-end UK retail giant Waitrose and toy store Hamleys. The two main department stores Galeries Lafeyette from France and Bloomingdale’s from the US will open in 2009 and 2010 respectively. The Dubai Aquarium and Discovery Centre, home to 33,000 animal species, is already attracting visitors while other entertainment venues, such as the Sega Republic gaming zone and children’s play area KidsZania, will be open in 2009. Of the 160 food and beverage outlets to be opened, 40 are already operational at the food court on level two. Visitors can access the mall from the Sheikh Zayed Road through the Old Town development or from the Financial Street Road, Emaar Boulevard, Downtown Burj Dubai and through the newly-opened bridge off Interchange One. There is parking for 14,000 cars. Adrian Murphy business24-7.ae
UAE jewellers are planning an aggressive expansion into China which they believe will continue to boom despite the worldwide economic turmoil. China is an emerging retail market for diamonds and jewellery with growth fuelled by the economic growth along the coastal belt and demand from the prosperous young generation. And jewellers in China say they would welcome partnerships with Middle East companies. The US diamond market, traditionally the world’s largest, is reeling because of the credit crunch and liquidity crisis and this has had a knock-on effect on suppliers in Hong Kong. But the domestic Chinese market remains strong. « We already have a presence in Hong Kong, which is the gateway to the mainland Chinese market, » Damas Managing Director Tawhid Abdullah told Emirates Business. « We are going slowly and steadily and are looking for the right partner to explore the Chinese jewellery market. Our objective is to get closer to Chinese customers through a suitable partner. Our long-term plan is to have a presence in all the major provinces. To start with we will open at least 25 outlets in China, the minimum needed to have any impact on the market there. » Dubai-based Damas is no stranger to overseas expansion – it has stores in 18 countries and operates 50 outlets in India through a partnership with a local company. Amit Dhamani, CEO of Dhamani Jewels, one of the largest fine jewellery chains in the Middle East, said: « China and the UAE can work together in many segments of the jewellery trade. We can have production facilities there and the domestic retail market for jewellery and diamonds is huge. « The Chinese population is a major attraction for any diamond chain – about 10 million Chinese couples get married every year. We are also planning to expand our business in mainland China. The diamond business all over the world is facing a crisis but the Chinese market seems to be the light at the end of a dark tunnel. » William Wong, CEO of Hong Kong-based jeweller Luk Fook Group, said: « As Chinese people are getting richer and richer, demand for diamond jewellery is growing rapidly. « The demand is higher in northern China, which accounts for 60 per cent of the total market, than the southern part. Southern consumers prefer gold jewellery and demand peaks in the October-November marriage season. « About 50 per cent of our sales, worth HK4 billion (Dh1.9bn) comes from China and we have not been much affected by the slowdown in Japan and the US. « We are not worried about Middle East firms entering the Chinese market. There is a considerable difference between the precious metal markets in China and the Middle East. Dubai jewellers will take time to learn about the Chinese market. We would like to have a strong partner from Dubai. » He said the high and volatile gold price had boosted demand for diamonds. « The average spend on diamonds in China is $500 (Dh1,840) per transaction. The higher end purchases go up to $150,000. Middle East investors should know the difference in rules and consumer attitudes in northern and southern China. « Hong Kong companies, which have been badly hit by the economic slowdown in the US, are now focusing on the mainland market. Until recently 50 per cent of Hong Kong’s diamond exports went to the US. » Luk Fook has 380 outlets in the Hong Kong, Macau, elsewhere on the mainland, Canada and the US. Kent Wong, Director and General Manager of Chow Tai Fook Jewellery China, said: « We have 800 outlets all over the country and every year we have seen double-digit growth in the market. « Even now, when the economic tsunami has hit Hong Kong jewellers exporting to the US market, Chinese consumers continue to show a traditional appetite for jewellery. « Consumers in mainland China prefer to invest in 24-carat gold jewellery as an investment and as an ornament for daily use. All our outlets have been doing well but the outlets along the coastal belt have been doing particularly well. » Wong said the coastal cities had witnessed strong growth following economic reforms and product lines aimed at younger buyers were doing exceptionally well. « Young Chinese couples spend in the range of $50 to $200 per jewellery piece. Rich Chinese consumers spend an average of $1,000 per piece. » Mark Wong, Chief Purchasing Officer of the diamond department of a leading Chinese company, said new shopping malls and conventional department stores were both important channels for the sale of diamond and gold jewellery. « The average investment to open a new shop in China is $600,000. Compared with the US or Hong Kong the crime rate is very low on the mainland. About 95 per cent of Hong Kong jewellers have shifted their production to China. « UAE companies will have to establish partnerships with experienced Hong Kong firms to successfully penetrate the Chinese market. » China is the fifth largest diamond consumer in the world, with sales soaring from $230m in 1995 to $1.2bn in 2007. More than 2.5 million diamond jewellery items are sold annually on the mainland. VM Sathish business24-7.ae
High fuel costs sent Emirates’ net profits for the first six months ending September 30, 2008, down 88 per cent to Dh284 million ($77.3 million) from Dh2.36 billion for the same period in 2007. The airline said its fuel spending in the first half of this year more than doubled to Dh9.2bn from last year’s Dh4.1bn. Emirates’ operating revenues, meanwhile, increased by 31 per cent to Dh22.1bn, while the passenger traffic was up 11 per cent; passenger yield increased by 20 per cent and cargo tonnes went up 13 per cent. The seat factor averaged 78.3 per cent, down slightly on 79.7 per cent for last year, against a 13 per cent increase in capacity. With regards to projections for the next six months, Emirates’ President Tim Clark told Emirates Business: « I am not sure we would be able to recover the first half losses six months prior to that, but we would be able to recapture our profit targets faster with fuel prices coming down. After all, fuel costs took a straight hit to our bottom line. » Crude oil prices averaged $122 per barrel for the first six months of the financial year, up from an average of $67 for the same period last year. Clark said he expects fuel price to stay between $65 and $85 a barrel in the second half of the airline’s financial year and « hopefully even lower ». « If that happens and things go as they are going right now with our forward bookings looking good, I remain cautiously optimistic that we would be ahead of the game for our financial year 2008-2009, » he said, adding that the airline’s bookings looked up in January and February next year. Shuaa Capital’s Vice-President for Research, Kareem Murad, on the other hand, says that the airlines across the world, including Emirates, would experience lower load factors. « Emirates would be able to recover some of the losses it incurred in the first half of its financial year but I do not know to what extent. This is because a drop in load factors is going to kick in resulting in lesser revenues, besides the ongoing global financial crisis, » Murad told Emirates Business. Clark, meanwhile, said that the airline is going full steam with its fleet expansion plans besides adding new routes to its network. « Even though there is high volatility in the market right now, we are managing the business fine. And don’t forget that we are equally exposed to the fuel side of things just like other airlines in the world, » he said. He further said that the airline is also looking to cut costs further in order to restore its profit growth. Shweta Jain business24-7.ae
Regular flights to internal destinations in Abu Dhabi are to be offered for the first time by executive jet and helicopter operator Falcon Aviation Services. The company will also consolidate service between Abu Dhabi’s Emirates Palace and Dubai’s Burj Al Arab. « Without doubt this new launch and expansion in the private aviation sector reflects the growth and development taking place in the UAE, » said Lieutenant General Sheikh Saif bin Zayed Al Nahyan, Minister of Interior. Captain Salem Al Kayoumi, Chairman of Falcon Aviation Services, said: « We will be launching this kind of service for the first time in Abu Dhabi, which has a vast area, to meet demand from the major economic sectors. « We will offer both executive jets and helicopters for tourism, medical emergencies and transportation. « With the huge economic growth taking place in the UAE and the region, private aviation services will have a lot to offer to companies as part of benefits to their employees, such as tourism and health insurance. » Al Kayoumi was speaking at an event organised by Falcon Aviation Services at Al Bateen airbase to announce its expansion plans. The company currently has 11 helicopters, which are valued at $61 million (Dh224m), and two corporate jets, worth $65m. It has confirmed orders to add a further 16 executive jets worth $318m and 10 helicopters worth $119m to its fleet by 2012. Chief Executive Officer Philip Markham said: « In the helicopter business, to reach the minimum required return on investment, we need to fly each aircraft for 600 hours per year. For corporate jets the annual number of hours required is 700 per aircraft. But we see new players coming into the market and lowering their prices, which means we have to fly more hours per aircraft to reach our revenue targets. « From our experience in Dubai we have targets for high season and low season. For the low season our forecasts dropped by a third over the summer but in the high season the results were better than we expected. « When some markets slow down the other segments will keep us going and that is why we offer diversified services. We offer our products and services to the higher end of the market, including individuals with high disposable incomes. » Prestige Jet and Royal Jet provide services to Abu Dhabi’s government and private corporate sectors but only Falcon Aviation Services has both jets and helicopters in its fleet. Rami Eljundi business24-7.ae
