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Emirates launches direct LA route

Emirates airline will become the first carrier to link the Middle East and the US West Coast when it launches a non-stop service tomorrow to Los Angeles, the second-largest US city. The journey from Dubai to “Tinseltown”, some 13,420km, will take 16 hours and 35 minutes on a Boeing 777-200LR aircraft. Emirates is offering 266 seats in a three-class configuration, with 10 tonnes of freight capacity. Emirates’s fourth US destination, to San Francisco, will launch on Dec 15. In the process, Emirates’s new routes to California may help to reshape the global airline connectivity map, in which travel between the US and West Asia has until now been heavily dependent on transiting through Europe. “This new route is a very important growth market for Emirates,” said Richard Aboulafia, an airline analyst with the Teal Group, based in the US. “LA is one of the top global business, travel and demographic hubs, and Emirates is particularly good at attracting premium traffic, the most profitable market.” Emirates’s LA flight will be its third into the US, following New York and Houston, and its first to the populous and prosperous US West Coast. Major incentives for linking the two cities are the large communities of Iranian-Americans and Indian-Americans in the Los Angeles metropolitan area, two affluent groups that travel often to the Middle East and South Asia to visit friends and relatives. “There is a massive local community of west Asian and Middle Eastern-origin residents on the West Coast, many of them very well educated and affluent,” said Peter Harbison, the managing director of the Centre for Asia Pacific Aviation, a consulting firm and think tank based in Sydney. Mr Harbison said Emirates stood to score points with these travellers because of the greater accessibility and a more user-friendly service Emirates offered via its new Terminal Three facilities at Dubai International Airport. The LA service is a coup for Emirates, which beat its rival Qatar Airways, another fast-expanding Gulf airline that is trying to become a major long-haul carrier for East-West traffic. Last year, Akbar al Baker, the chief executive of Qatar Airways, said opening a route to Los Angeles was a top priority because of the 500,000 Iranian-Americans who would now be able to travel back to Iran via the Gulf. The new service may also worry British Airways, which boasts some of the most extensive connections to the US of any foreign carrier. “Dubai’s plan is to become the hub that links the world’s biggest aviation market, North America, with its fastest-growing, Asia. And this link would bypass Europe altogether,” Willie Walsh, the chief executive of British Airways (BA), warned in a recent letter to the editor of a British newspaper. As he lobbied for expanding Heathrow airport, Mr Walsh said BA was directly threatened by Emirates’s growth. “The hugely expanded Emirates will be scooping up Heathrow’s and the UK’s business. With shrivelling connectivity, London’s position as a global business capital will slump at the same rate,” he said. At the same time, US carriers have also been eager to bypass Europe and connect the US with the fast-growing Gulf region. As Emirates’s inaugural flight to LA flies over the Atlantic, United Airlines will be launching its inaugural flight to Dubai from its hub in Washington DC. The new route follows Delta Air Lines’s service to Dubai from its base in Atlanta, which began last year. Mr Harbison said opening new markets could often create transformative and profound changes to the air travel industry. “As we have seen over and over again, when new aerial highways are created, whole new markets open up – either because of lower prices or because of the greater convenience,” he said. If so, the stimulus will help to buoy flagging Middle East air traffic figures, which fell 2.8 per cent last month, the first monthly decline in four years, according to the International Air Transport Association. The new route comes amid ongoing aircraft availability concerns for Emirates and other Gulf airlines, which have some of the world’s largest order books for new wide-bodied aircraft from Boeing and Airbus. Due to the two-month-long labour strike at Boeing, as well as problems with one of Boeing’s key galley suppliers, Emirates was forced to delay the Los Angeles launch from September until tomorrow. It also scaled back plans to fly to Los Angeles to only three flights per week, from seven days a week, because of a shortage of aircraft due to the strike. thenational.ae

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Saudi Arabia’s benchmark index slumps 8.7%

Dubai: Saudi Arabian stocks fell sharply on Saturday, tracking a slump in world markets, as investors worried that an oil price plunge and possible global recession would hit the growth of firms in the world’s top oil exporter. The benchmark of the largest Arab bourse closed 8.7 per cent lower at 5,624 points, a day after bourses around the world plummeted as investors, fearing a long and deep worldwide recession, dumped risky assets. The index has fallen more than 44 per cent so far this year and is the worst-performing measure in the region after Dubai. « The Saudi market is positively correlated with the global markets, especially the big ones, » said John Sfakianakis, chief economist at SABB bank, HSBC’s Saudi affiliate. « As we’ve seen these markets tumble, the Saudi market has tumbled by a higher degree. There is negative sentiment. » Saudi investors were also reacting to the near $4 drop in oil prices on Friday. Six other stock markets in the oil-exporting region were closed on Saturday. Reuters

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Kuwait to chair Jeddah summit

The sixth Gulf summit for leaders of the Gulf Cooperation Council (GCC) states will be held in Jeddah next Sunday, and will be chaired by Kuwait as chairman of the current session of the GCC. Holding the midyear unofficial GCC summit aims to exchange viewpoints and explore latest regional and international developments, to boost coordination and consultation, as well as to unite stands. The summit will be preceded by a meeting of the GCC Ministerial Council, which will include foreign ministers of GCC states, to prepare the agenda to be discussed during the one-day summit. Gulf diplomatic sources told Kuwait News Agency (KUNA) in Riyadh, Tuesday, that leaders will explore during the summit major issues that include fighting terrorism, the situation in Iraq, the deteriorating situation in the occupied Palestinian territories and the ongoing Israeli aggression against the Palestinian people, in addition to other Gulf economic and developmental issues. The bombing incidents that occurred in Riyadh and Yanbu will also be discussed, as security of the region is a joint responsibility. The upcoming consultative summit is an opportunity to unite Gulf stands before holding the 16th Arab Summit, scheduled to be held in Tunisia on May 22-23, in particular the importance of reforming the Arab League and finding new mechanisms to develop joint Arab work. kuwaitbusiness.net

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Qatar Financial Center

Qatar is one of the world’s fastest growing economies, and the wealthiest country in the world measured by GDP per capita. The Qatar Financial Centre (QFC) lies at the heart of this small but dynamic country’s ambitious investment and development strategy.

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Sharjah public sector GDP share rises

The government sector in Sharjah has grown its share of the emirate’s gross domestic product (GDP) from Dh60.4 billion in 2006 to Dh68.4bn in 2007, making 13.2 per cent growth. The government sector is currently accounting for 17.87 per cent of the overall GDP of the emirate. As the government services sector has a major share in GDP, it is capable of acting as a corrective force for the economic growth and will show a proven quality performance in government services, gaining the necessary power to guide the economic sector to the desired direction, said Ali bin Salem Al Mahmoud, Sharjah Economic Development Department General Manager. The GDP growth rate of the emirate from 2004 to 2007 was 41.7 per cent according to local statistical data. It grew to Dh68.4bn in 2007 from Dh30.4bn in 2004. The overall GDP of the emirate amounted to Dh68.4bn in 2007, a 13.2 per cent growth as compared to figures of 2006, according to federal statistical data. The share of commodities products sector (agriculture, manufacturing industry, construction, electricity, gas and water) to GDP has grown from Dh13.6bn in 2004 to Dh24.7bn, Dh27.7bn and Dh29.6bn in 2005, 2006 and 2007, respectively. The average annual growth rate of commodities products sector during the period from 2004 to 2007 was calculated at 39.3 per cent. The manufacturing industry sector has the lion’s share to commodities products sector’s GDP, posting Dh12.2bn in 2007, a 41.2 per cent from the GDP of the sector at Dh29.6bn. The manufacturing industry has the highest added value in the Gross Capital Formation, accounting for 19.99 per cent in 2007. The emirate has solved the problem of declining share of manufacturing industry to the GCF, with a growth of 79.3 per cent from Dh2015m to Dh3613m in 2007. This means the manufacturing industry sector has the highest share to gross capital formation in value and rate of contribution, a growth that proves an appropriate direction of the emirate’s policies in supporting the sector from one side and interest shown by investors and private sector from the other side. business24-7.ae