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 Mon 30th Jan 2012 | | KSA inflation to average 4.3% in 2012 | Saudi Arabian inflation will average 4.3 percent this year as global commodity prices fall, Al Rajhi Capital, the investment arm of the country’s largest lender by market value, said Sunday in a report.
Consumer prices rose an annual 5.3 percent in December, the Saudi Press Agency reported Jan. 14, citing data from the Central Department of Statistics.
Saudi inflation edged down to its lowest rate in four years in 2011 as lower rents and food prices more than offset a rise in other components of the consumer price index, Riyadh-based Jadwa Investment firm said.
It put total inflation at five percent in 2011, down from 5.3 percent in 2010 and 5.1 percent in 2009. The rate hit a record annual high of 9.9 percent in 2008.
“Annual average inflation for 2011, at five percent, was little changed from the previous two years. Inflation for food and rent (the largest components of the cost of living index) slowed, offsetting rises in most other categories,” Jadwa said.
A breakdown showed housing and related items shrank to 7.8 percent in 2011 from 9.5 percent in 2010 to maintain a downward trend since 2008, when it climbed to an all time high of 17.5 percent before falling to 14.1 percent in 2009. | | | | Mon 30th Jan 2012 | | GCC economies to see solid growth in 2012 | Despite the prospect of further turmoil in global financial markets, GCC economies should see another year of solid growth in 2012. Real GDP growth is seen at 4.6%, compared to an oil output-boosted 7.9% in 2011. Oil markets are assumed to remain firm, while further increases in government spending will support investment and consumer spending. Meanwhile, the risks from an external financial shock from Europe or elsewhere seem manageable: GCC banks are liquid and well-capitalized, direct exposure to risky euro-zone government debt is negligible, and financial and economic excesses are much smaller now than in 2008. Qatar will once again be the region’s strongest performer, although its growth is likely to decelerate as gas production levels off.
Regional crude oil production leapt by 11% in 2011 as OPEC countries – led by Saudi Arabia and the GCC – moved quickly to replace 1.5 mbpd of lost Libyan output. Even with the gradual return of Libyan production and the risk of an economic downturn, oil market fundamentals are expected to remain tight through 2012 and worldwide inventory levels could decline again. As such, GCC countries may avoid large cuts in oil production, leaving average output more or less unchanged this year. Oil prices are assumed to average $110 per barrel (pb) after $108 in 2011.
GCC government spending could record its lowest rate of increase in several years in 2012, at 6%. However, this more reflects the super-strong 17% increase of 2011 – driven by $27 bn of exceptional spending in Saudi Arabia – than any deliberate belt tightening. The Arab protest movement of 2011 will help ensure that governments remain focused on their medium-term development goals and that fiscal policy remains supportive of growth. Private sector activity – still held back by deleveraging and sluggish credit growth in some countries – should continue to recover. Real non-oil GDP is seen growing 5.6%.
In spite of decent growth and big increases in government spending, inflation remained generally in check through 2011, averaging an estimated 3.2%, up fractionally from 2010. Key to this was the deceleration in food price inflation in 2H 2011, led by softer global commodity prices. But ‘core’ inflation has also remained low, at around 2%. Another year of solid economic growth and an improvement in monetary conditions across the region could presage a slight pick-up in inflation in 2012 to 3.8%. Given regional currency pegs, the 6% strengthening of the US dollar trade-weighted index in 2H 2011 will help cap ‘imported’ inflation through 2012.
With oil production high and prices remaining above the $100 pb mark, the GCC will see a further year of large fiscal and current account surpluses, possibly in the range of 10-20% of GDP for the region as a whole. This will once again mark the region out in a year of austerity and deficits elsewhere in the world. Indeed, one major challenge for the region will be to decide how to invest these surplus revenues safely given the uncertain global economic outlook. | | | | Tue 17th Jan 2012 | | 18.4% rise in DEWA's installed power capacity | Dubai Electricity and Water Authority (DEWA) has recorded an increase of 8,718 Megawatts (MW) in installed capacity for 2011 in comparison with 7,361 MW in 2010, with desalinated water production capacity increasing in 2011 to 400 million gallons per day (MIGD) in comparison with 330 MIGD in 2010.
According to HE Saeed Mohammed Al Tayer, Managing Director, and CEO of DEWA, the agency’s recent achievements accord with the directives of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, to promote Dubai’s pioneering position as a global hub for finance, business and tourism, and to enhance its infrastructure in all fields. Power production has now reached 34,606 Gigawatts per hour (GWh) with an increase of 2.6% in comparison with 33,742 GWh in 2010.
He further added that at DEWA, we focus on the availability, reliability and efficiency of our delivered electricity and water services. We review key performance indicators, compare them with best world practices, and work to improve and develop all operations to achieve excellence at all levels.
He concluded that increasing power and water production aims to meet customers’ needs and development projects in all various economic and social sectors of Dubai. | | | | Mon 16th Jan 2012 | | UAE air passenger traffic up 7.6% in 2011 | Air Traffic Movement in UAE experienced a remarkable growth during 2011, with an increase of 7.6 per cent compared to the previous year. Local airports accounted steady increase in the rates of air traffic movements during the past twelve months, as reported by Sheikh Zayed Air Navigation Centre.
The total number of air traffic movement during last December reached 61197, with an average of 1974 movement per day. Dubai International Airport came first with a total of 28223 air traffic movement in December 2011, followed by over flights with 13233 movements, and Abu Dhabi airport with 8686 air traffic movements.
The distribution of air traffic movement over the remaining airports went as follows: 5522 air traffic movements at Sharjah Airport, 186 at Fujairah Airport, 84 at Al Ain Airport, 555 at Ras Al Khaimah Airport and 495 air traffic movements at Al Maktoum Airport.
Sheikh Zayed Air Navigation Centre report indicates that January 2011 saw the highest percentage in terms of increase in air traffic, where there was an increase by 10.3. That is, a daily average of 1846 air traffic movement compared to an average of 1673 in the same month in 2010. The month of September 2012 witnessed a significant increase compared to 2010, as well, reaching 9.7 increase in air traffic movement — 1926 in 2011 compared to 1756 during September 2010-.
“The remarkable increase in air traffic movement in UAE is attributed to the prosperity of business and tourism in the country, UAE possesses all necessary factors to attract business people and tourists from around the globe,” said Saif Mohammed Al Suwaidi, Director General of UAE General Civil Aviation Authority (GCAA).
“UAE’s government, represented by the General Civil Aviation Authority, adopted a policy to encourage the signing of Air Service Agreements on the basis of open skies with countries of the region and the world, and to provide a competitive environment for airlines. This is translated in the increased number of registered companies and a hike in the number of air traffic movement.” Al Suwaidi added.
| | | | Mon 9th Jan 2012 | | Oman's economy shows robust growth in 2011 | The economy of Oman experienced vigorous growth in 2011 despite widespread financial crisis in many of the world’s advanced economies. The Minister Responsible for Financial Affairs in Oman, Darwish bin Ismael al Balushi, stated that 2011 growth resulted from growing oil production, advancing prices and the government’s monetary and fiscal policies supporting expansion.
While announcing the 2012 budget the minister reported healthy growth in Oman’s non-oil industries as well. The national economy experienced solid growth based on the non-oil sector’s 10 percent growth rate, much higher than the oil sector’s growth of only 2 percent. Domestic demand also increased, bumping non-oil exports 20 percent higher than the 2010 levels, according to the minister.
In Oman’s budget statement initial GDP forecasts indicate that the economic growth of 7 percent in 2011 surpassed the levels seen in 2010.
Al Balushi stated that expenditures of RO 8130mn in the approved 2011 State General Budget resulted in a deficit of RO 850mn, based on oil prices of $58 per barrel. Omani oil actually hit an average of $108 per barrel. Despite additional approved allocations of RO 1.8bn targeting security and civil expenses, the budgeted deficit amounted to approximately RO 2.6bn.
Oman’s actual budget is forecasted to maintain a surplus of around RO 1bn, mainly as a result of stability in global oil prices. About RO 700mn of that surplus is marked to cover the 2012 budget deficit, while any balance remaining after the accounts have been closed is intended to fortify the State’s financial reserve, according to a statement.
Indicators of inflation have been maintained at 4 percent, despite greater general expenditures throughout the year and the influence of imported inflation. That level is within period targets. | | | | Fri 6th Jan 2012 | | Abu Dhabi economy expected to grow 4 pct in 2012 | Abu Dhabi’s GDP is forecasted to increase by 4 percent in the coming year, reaching Dh 750bn according to statements made by the ADCCI (or Abu Dhabi Chamber of Commerce and Industry).
Revenues from the emirate’s oil sector are expected to contribute Dh 385bn to the increase. Crude oil revenue is forecasted to jump from Dh 309bn in 2011 to Dh 345bn in 2012.
The balance of 2012 oil-related revenue totaling Dh 40bn will come from gas liquefaction and refining.
Improvements in the contribution of the public sector are also forecasted, rising from the Dh 126bn reported in 2011 to Dh 133bn this year.
Estimates from the ADCCI indicate that private sector GDP contribution will increase from Dh 218bn last year to Dh 232bn in 2012.
Statistics from the ADCCI uncover that numerous development projects will be implemented by the private sector across a variety of industries. These events will cause the private sector’s formation of total fixed capital to hit 55.4 percent in 2011 and 54.1 percent in 2012.
Zarouni Group chief analyst Waddah Taha stated that economic diversification is happening quickly in Abu Dhabi, as the non-oil industries increase their share of the GDP for the second consecutive year.
Oil accounted for 49.7 percent of the GDP in Abu Dhabi back in 2010, according to Taha. | | | | Thu 5th Jan 2012 | | GCC to spend $968 billion for new projects | Over the next ten years 1,638 projects across the GCC are expected to see implementation, resulting in $968 billion in investments. These projects are supported by record-high revenues in the oil sector and will affect a variety of sectors within the GCC, according to a report by the Markaz.
According to the report a majority of these projects, more than 80 percent, involve the petroleum industry, construction and infrastructure.
Consistently high oil prices have permitted the GCC member nations to implement investment commitments targeting development and growth projects, as stated in the report.
Execution of these vital projects will require a compatible and clear set of policies and systems that allow for integration and support efficient implementation. Many of the member states have acknowledged the importance of PPPs (or public private partnerships) to accelerate and facilitate these projects, along with other mechanisms such as joint venture agreements and direct foreign investments.
Kuwait will implement 218 of these projects, totaling more than $133 billion spread across the next decade. Despite this nation’s massive financial wealth, it has been reserved in the spending and awarding processes.
It is expected that between 2011 and 2020, $97 billion will be spent in the GCC on new rail and road projects. Rail projects, such as stations, metro, train and tram projects, are forecasted to reach $79 billion including a $30 billion shared cost rail network stretching across the GCC.
The value of ongoing roads projects should total about $18 billion, according to the report.
Many GCC nations are considering or planning their own metro systems, especially after the success of the metro launch in Dubai. A 131km metro system in Abu Dhabi is forecasted to begin in 2015. A pan-GCC rail system is in the works, with an updated value of about $30 billion. This network will include the first rail line linking all the GCC member states. A bridge and one rail line stretching 1,970km will link Qatar and the GCC members. Another line stretching 1,984km will connect the UAE, Saudi Arabia and Kuwait, before ending in Oman. Forecasted land acquisitions for this network total $3.1 billion, while the budgeted purchase of locomotives and trains to ride the network is forecasted at $1.8 billion.
Once the engineering studies have been completed in 2012, work should begin on this network.
Port expansion projects are forecasted at almost $15 billion across the GCC. Implementation of these projects to meet expanding business needs is expected to span the next five years.
Expansion will occur in most of the 35 major ports in the GCC, in order to deal with an approximate 8 percent growth in 2010, where capacity hit almost 25 million TEU’s. According to the report, ports in the UAE handle 59 percent of total GCC volume.
In 2010 Dubai came in as the ninth largest port in the world, while Oman’s Salalah was named 32nd on the list of global ports and Saudi Arabia’s Jeddah captured 30th place, according to the report.
Healthy growth in seaport investments is expected to push capacity even higher. Much of the increased investments have occurred in Abu Dhabi and Dubai, and Markaz noted that other GCC member states have plans to improve port conditions. | | | | Next |
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