Middle East Business News Review – 13 November
Today’s top business and economy news from the Middle East and North Africa:
UAE’s First Gulf Bank inks $900m loan deal
First Gulf Bank, the second-largest lender by market value in the UAE, has signed a three-year $900m loan with a group of international lenders, the bank said in a statement on Tuesday.
The senior unsecured facility, priced at 130 basis points over the London interbank offered rate (Libor), was increased from the original $800m amount because of demand from banks wanting to join the deal, FGB said.
UAE salaries set to rise 5.1% next year – report
Average salaries in the UAE are expected to rise 5.1 percent in 2013 compared to a Gulf-wide increase of 5.4 percent, according to a new study by consultants Aon Hewitt.
Employees working for banks in the Gulf state will see the largest rise with wages set to increase 8.1 percent next year compared to a 2.5 percent rise in the transportation, logistics and shipping sector.
Drake & Scull wins $87m Saudi, UAE deals
Drake & Scull International (DSI) on Tuesday announced that it has been awarded three new contracts amounting to AED318.5m ($87m) for projects in Saudi Arabia and Abu Dhabi.
The mechanical, electrical and plumbing (MEP) deal in Saudi Arabia is worth SR83m and covers 58 commercial buildings and will be completed in the third quarter of 2013, the contractor said in a statement.
The administrative governmental project in the UAE capital, valued at AED115m, and a AED118.5m contract for a hospitality development are both scheduled to be completed in the fourth quarter of next year.
Omantel’s Q3 profit hit by Pakistan unit losses
Oman Telecommunications (Omantdel) posted a slight rise in third-quarter net profit, missing analysts’ estimates as rising costs and losses from a Pakistan unit offset mobile broadband gains and lower asset depreciation.
The former monopoly on Tuesday reported net profit of OR28m ($2.6m) for the three months to September 30, up from OR27.43m in the year-earlier period, according to Reuters calculations.
Analysts polled by Reuters on average forecast Omantel would make a quarterly profit of OR29.88m.
Qatar gov’t budget slips into $5bn deficit in April-June
Qatar’s government budget slipped into a deficit of QAR18.5bn (US$5.1bn) in the first quarter of its 2012/13 fiscal year, preliminary data from the central bank showed on Tuesday.
The fiscal shortfall of the world’s number one exporter of liquefied natural gas was equivalent to 10.7 percent of gross domestic product in the period, according to the central bank.
It was wider than the QAR2.2bn gap, or 1.4 percent of GDP, seen in the same quarter of last year.
India eyes additional Gulf routes
India is in talks with several Gulf states to increase the number of routes between the subcontinent and the region. The negotiations come in spite of criticism that India has historically allowed GCC carriers to boost the number of flights to the detriment of its own carriers.
In a statement, India’s Civil Aviation Ministry (CAM) said negotiations are under way with several governments including Dubai, Abu Dhabi, Saudi Arabia and Oman to “explore possibilities of enhancing additional traffic rights with those countries with whom existing traffic rights have almost got exhausted”.
The move is likely to reignite the row that erupted last year after India’s national auditor said Gulf carriers should be forced to reduce services to the subcontinent.
Saudi firms projected to raise staff salaries
The average annual salaries of Saudi and expatriate workers is expected to jump by 5.8 percent in 2013, according a survey of 66 companies in the Kingdom by Dubai-based Aon Hewitt consulting firm.
The salary raises in Saudi Arabia were larger than expected increases in Bahrain, Oman and Qatar. But the Kingdom trailed badly behind Egypt, which expects a 9.5 percent increase in wages, and Jordan, which anticipates a 6.6 percent rise in salary for 2013, according to the survey.
Bahrain’s private companies raised salaries this year by 4.4 percent and anticipates increases by 4.7 percent for 2013. Oman’s private sector salaries rose 5.4 percent this year, and expect a slight uptick of 0.2 percent for 2013. Qatar anticipates wage increases from the private sector to jump by 5.6 percent in 2013.
Iran postpones second round of subsidy cuts
An Iranian lawmaker says the country’s parliament has postponed the implementation of a second round of subsidy cuts until 2013 over fears of stoking already rampant inflation.
The head of the parliamentary budgetary and planning committee Gholam Reza Mesbahi Moghaddam told the semiofficial Mehr news agency the second phase of the three-part plan would likely cause a 15-percent jump in the inflation rate, which is officially running at almost 25%.
Egypt PM targets 3.5% GDP growth in 2012/13
Egypt’s government will focus on boosting flagging economic growth to 3.5 percent this financial year and 4.5 percent in 2013/14, Prime Minister Hisham Kandil said on Tuesday.
The government had forecast growth of 4 to 4.5 percent in its budget for 2012/13. Economists had said this was optimistic. Kandil met President Mohamed Mursi on Tuesday to present a reform plan to help get the country’s finances under control and persuade the International Monetary Fund to approve a $4.8 billion loan to support the economy.
France eyes Libya deals after unfreezing $2 billion assets
France said on Monday it was ready to start releasing almost $2 billion in frozen assets belonging to Libya’s sovereign wealth fund, as it looks to secure investment from the oil-producing nation.
France’s Foreign Minister Laurent Fabius made the announcement during a visit to Tripoli, the latest in a series of high-level French political and business delegations to the OPEC member.
France spearheaded efforts to oust Libyan leader Muammar Gaddafi last year and, as part of wide-ranging international sanctions, froze about $8-9 billion in assets held in France.
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