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Economics & Policy

Syria’s workhorse dies with Aleppo

by Zak Brophy September 20, 2012
written by Zak Brophy

A dozen men stand in silence watching as others brick up the shattered storefront of an industrial hardware shop. A mortar strike blew apart its façade only hours ago in this northeastern section of Aleppo, and three hundred meters down the street fighting continues to rage between government forces and opposition fighters of the Free Syria Army (FSA). No words are shared between the disgruntled merchants and a pair of rebel fighters standing nearby — there is clearly little love lost.

The wrecked shop is in a district called Aaqoora, in the middle of what used to be one of the city’s thriving industrial quarters. Now the hundreds, if not thousands, of small and medium sized factories here are empty. “Not a single one of the businesses in this area is working now… none,” snaps one of the bystanders.

Further down the block a door swings ajar on a textiles factory. Thread still lays taut across the looms and reels of cloth are stacked in the corner of the abandoned room, now strewn with broken glass and smashed plaster. The factory feels suspended in time until a thunderous explosion bellows out nearby — another small part of Aleppo laid to waste. (Click here for a photo tour of the city)

Until the Holy Month of Ramadan began in late July, Aleppo and its more than 2 million inhabitants had, for the most part, been insulated from the violence wracking the country elsewhere. However, when the battle shifted mid-summer from the surrounding countryside into the heart of this city, which is Syria’s industrial and economic workhorse, it unleashed a torrent of destruction that continues unabated.

The plethora of fighting units that make up the opposition FSA have taken control of more than half of the urban area, but the virtually unchallenged air and artillery power of the government’s forces allows them to launch attacks into every corner of Aleppo and the surrounding countryside. The bombardments from above are often indiscriminate and devastating. Whole districts lay abandoned with thousands of shops, businesses and homes shuttered, their owners and residents having fled.

Flight from havoc

“People are taking their whole operations to other countries,” says Syrian businessman Abdul Karim-Sayyed. “We can say there is an industrial migration going on now from Syria to Iraq or Egypt or Turkey or elsewhere. The majority are going to Egypt.”

Sitting in his office in Bourj Hammoud on the outskirts of Beirut, Lebanon, he laments the demise of his home. Aleppo used to employ as much as 40 percent of Syria’s industrial workforce, with manufacturing alone accounting for 150,000 jobs; the city produced 35 percent of all the country’s non-oil exports, and in sub sectors such as textiles and pharmaceuticals, this share rose to some 70 percent, according to Madinatuna, (the municipal program also know as the Aleppo City Development Strategy). All this has now ground to a violent halt.

Karim-Sayyed is from the generation of businessmen who successfully emerged from Syria’s first round of economic liberalization under then-President Hafez al-Assad, which began in the early 1990s, when the government started to encourage private investment and the export of Syrian products by private enterprises. Karim-Sayyed’s portfolio of companies were involved in such things as clothing, textiles and furniture exports, haulage and a private bus company in Aleppo. In recent months, however, along with most of Aleppo’s industrialists, he has extricated what capital he can from the violent quagmire.

In the past the Syrian regime kept a lid on the levels of capital individuals and businesses could transfer outside the nation. While there have always been circuitous routes around these restrictions, Karim-Sayyed argues that in the current state of lawlessness whatever barriers there were simply no longer apply.

“There are many ways to get your money out of Syria,” he says. “The border with Turkey is wide open — you take your money there without anyone asking any questions. There are no laws anymore.” 

Ransom as financing

Back in Aleppo, the absence of law pervading the city has given rise to widespread kidnapping, extortion and theft targeting Aleppo’s middle and upper classes and their businesses, spurring many to flee to safer climes. While fighters and leaders within the FSA concede this occurs, they often contend that it is beyond their control.

Abdul Fader is a softly spoken and well-educated man with an affable and polite disposition. He used to work as an Islamic scholar for Aleppo’s Department of Islamic Jurisdiction but now commands some 150 rebel fighters in the city. Fader’s transition from religious scholar to military leader started in August 2011, through leading operations to assassinate Shabiha — a term used to describe the paramilitary supporters of the regime. “Our weapon of choice was the silencer,” he calmly reveals. 

When elements of the opposition started preparing to move the armed conflict from the Aleppo countryside into the city, Fader says the Shabiha were increasingly targeted for ransom kidnappings to fund the procurement of weapons and vehicles. Though the price tag varied due to the “economic condition” of the hostage, the standard rate was anywhere between $5,000 and $20,000. “I believe that in the early days around 50 percent of the funding for the armed uprising came from kidnapping those mercenaries,” says Fader. He claims his men would covertly gather evidence on every potential target for him to review, and that he called off operations against roughly half the cases brought before him on the basis that he could not justify the action under Islamic law.

Other armed groups are less concerned with determining whether potential kidnapping victims are Shabiha or not. The title ‘FSA’ suggests one united fighting force, but the reality is the opposition is comprised of a wide variety of different outfits, including armed criminal gangs who are indulging in kidnapping and extortion for blatant monetary gain.

 

Industrial amputation

Perched on the northeastern high ground overlooking Aleppo is the Sheikh Najjar Industrial Park. As of early 2011, the Syrian Arab News Agency was reporting that the park had accumulated $3.4 billion worth of investments, housed 75 foreign companies and provided employment for some 35,500 people. Only months ago a flourishing hub for Syrian textiles, chemicals, pharmaceuticals and agro-foods, it is now a 44-square-kilometer ghost town. There is no traffic, and it seems the only people around are the guards at the gates of the factories, on the lookout for potential looters or refugees looking for a safe place to squat.

One of the few plants operating, although at a significantly reduced capacity, is the Sultan Carpet Company. A floor manager at the plant, who refuses to give his name, says less than 10 percent of the industrial city is still in operation. Within minutes of beginning to speak, however, a car full of stern-faced men in suits arrives and makes it clear that neither the questions, nor Executive’s escort of two armed guides in battle fatigues, are welcome. The gates to the factory close and the workers are ushered back inside.

While many of Aleppo’s businessmen and industrialists have either fled the country or kept a cold and hostile distance to the armed uprising, some have thrown their lot in with the revolution. Mustapha Chebaan is a large and portly man who wears an army waistcoat over his brown jalibiyeh while hosting guests at the barracks where he leads a brigade of around 200 FSA fighters. The camouflage attire and newly adopted military role veil his previous identity as a major business figure in Aleppo and a member of the city’s chamber of commerce; founded it 1885 it is one of the oldest chambers of commerce in the Middle East and Arab world. 

“When they started to attack the peaceful demonstrations we left the chamber of commerce and we left our businesses to join the ranks of the FSA to support our people in Deraa and Homs and now in Aleppo,” he says. Chebaan made his money by building a contracting company and importing household appliances from China, and he talks of how regime loyalists and Shabiha targeted him and other likeminded businessmen with sabotage, kidnappings of family members and sometimes assassinations for empathizing with the anti-regime protestors. Once Chebaan closed his business, his attention and money was turned towards the financing and arming of the rebels.

His brigade’s barracks is replete with examples of the involuntary redistribution of wealth occurring in Aleppo; the building itself used to house military officers Chebaan accuses of leading the sabotage against him and other businessmen; while it is not possible for his fighters to buy new SIM cards for their mobile phones — as they need to be officially registered — rebels still attain them from kidnapped or killed regime loyalists and soldiers. Even some of the cars Chebaan’s fighters use have been “liberated” from their foes.

Fuel’s dirty business

Running those cars however, has become an expensive and cumbersome ordeal. There are no functioning petrol stations in the parts of Aleppo that the rebels hold or in any of the countryside to the north under their control. “The distribution at petrol stations stopped around a year ago now,” says petrol dealer Abu Farouq. “The owners were kidnapped and held to ransom. They paid up, were released and after that they left.”

Now street vendors sell fuel full of impurities from 120 liter barrels, and the unsteady supply causes prices to fluctuate between $2 to $4 per liter; it used to be less than $1. The dirty petrol also wreaks havoc on car engines, causing frequent stalling and forcing drivers to limit their speed, which can be of critical importance to the fighters in the heat of battle. “Damn this car,” curses an FSA fighter en route to the front line as his vehicle jolts to a stop once again. “I’d be better off trying to escape on a donkey.”

Ali Aleto, a 26 year-old FSA fighter, was among the many men from his village to the north of Aleppo who joined the armed opposition in the city. Shrapnel has shred his back and the wounds are still raw. Aleto’s injuries are a direct result of the fight for fuel that the rebels are waging. In an audacious FSA operation in early August, rebel fighters attacked a convoy of 17 government trucks near the Aleppo International Airport, each carrying up to 40,000 liters of diesel. Aleto was in the cab of one of the stolen tankers when it was struck by a rocket. “It was a close shave for sure, but we made off we six trucks in the end,” he says.

The Bedouin tribes from the east of Syria ensure a regular flow of fuel into the areas under FSA control. “Neither the government nor the FSA control the clans. They are more Iraqi than they are Syrian,” explains Abou Farouq. The Bedouin buy the fuel from areas under government control, such as Raqaa in central Syria, and then transport it to Sfeera, east of Aleppo, from where it is distributed to Aleppo and the FSA-controlled countryside. 

“Everyone involved benefits from this trade. Everyone gets around five Syrian pounds per liter, which amounts to around $6 per barrel,” explains Abou Farouq before adding with an ironic smirk, “Even the regime wants to sell it so they can earn money to buy weapons to use against us. It is business after all.”

 

A withering harvest

The fluctuating availability of fuel and its poor quality is felt heavily in the agricultural districts of Aleppo’s countryside to the north. Standing in his 10-hectare farmstead, Abu Beraa shakes his head as he holds out several small and shriveled potatoes. “I can’t sell these. They should be five times bigger. They will go to waste along with so much more of this crop,” he complains.

The reason for Abu Beraa’s failing crop is his inability to pay for the inflated fuel, fertilizer and labor costs. Fertilizer has risen approximately five-fold over the past two years, fuel has at least doubled this past year and the day rate of laborers is more than twice as much as it was last season. Pointing to one of the men pulling emaciated potatoes from the ground, Abu Beraa says, “One of these workers will work a month now just to be able to bring a canister of gas to his house. They now cost 5,000 Syrian pounds (SYP), and they used to be 410 SYP. That is an increase of more than 10 fold.”

Abu Beraa is not alone with his grievances. “I am scared of a real food crisis in the country this coming winter,” frets agricultural engineer Abu Abdullah, speaking in the Aleppo countryside. The spiraling costs are paralyzing agricultural production, which is compounded by the dangers involved in transporting the goods to market. “There used to be a large trade between us and our neighbors such as Turkey and Iraq, and considerable integration of the markets within Syria but this has all but been cut because of the dangers and costs of transportation,” explains Abu Abdullah.

Dry credit markets are further hobbling agricultural producers. Normally, they would take out a loan at the beginning of each season to cover expenses, and pay off this debt after they sold their harvest. This year, however, with the chronic lack of security and a dearth of confidence in the Syrian pound, lenders are sitting tight on their money; “There is fear of a collapse so no one will lend anymore,” explains Abu Abdullah. “Now people only work in hard cash.”

The woes of the countryside are being passed down the supply chain to fruit and vegetable vendors on the streets of Aleppo — among the few traders still in business besides the corner stalls selling cigarettes and fuel dealers with their roadside barrels.

“Hardly any vegetables are entering into the city,” says a vegetable seller whose shop sits only yards from a recent rocket strike that leveled a family home. “Tomatoes have reached 25 SYP; they used to be 10 SYP, even 5 SYP. The same with potatoes, they used to be seven and now they too are around 25 SYP. People can’t afford these prices.”

Shortages and empty shelves

In the neighboring district of Tariq El Bab, dozens of people stand in a queue at the local bakery for bread that is three to four times more expensive than before the uprising began impacting Aleppo. No one looks comfortable and eyes regularly flicker to the sky. “We come and stand here every day for our bread but we are scared of the planes,” says an elderly man as he waits in line. “They have targeted the bread queues before and only the other day 11 people were killed in such a strike.”

Many other essentials are also running short. In a small village several kilometers north of Aleppo a pharmacist leans on the counter with the shelves behind him all but empty, spare a few packets of the most basic of medicines. A customer walks in asking for tablets for diarrhea and even before he finishes his sentence the pharmacist awkwardly grimaces and apologizes. “The whole trade has pretty much disappeared,” he says. “We see shortages for a number of reasons; the factories have stopped producing, the warehouses have run dry, pharmacies have been hit and transportation is very dangerous.”

Not only has the stock dried up but the government support for medication for the poor has also evaporated. In the summer months diarrhea and nausea are the most common ailments but treatments are running thin. “There used to be support for people in need or the poor from the government, so we could give medications for free to people who really needed it,” says the pharmacist. “Unfortunately now there is no support so we can’t help people who are poor and destitute. They have to go without. Now it is the opposite. It is me that needs the support.”

A dying city

Streets that were once bustling arteries for commerce — trade that sustained the livelihood and wellbeing of hundreds of thousands of Syrian families — are now emptied by fear or choked in rubble. Aleppo’s main tourist attraction, the citadel in the center of the old city, is a sniper’s den for regime forces. The boom of artillery has replaced the banter of marketplaces. The city shakes from the warplanes’ rain of death.

In place of normal life there is war, which reaches far behind the front lines and impacts most painfully the noncombatants — those who have fired no bullets and yet pay for this innocence with the torn fabric of their lives.

September 20, 2012 0 comments
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The Buzz

Morning briefing: 20 Sep 2012

by Executive Staff September 20, 2012
written by Executive Staff

Saudi Arabia has denied allegations that Syrians will not be able to perform the annual Muslim pilgrimage of Hajj this year because of a conflict with Damascus.

The Saudi Hajj Ministry said in a statement on Wednesday that preparations to receive Syrian pilgrims are being processed and are highly considered because of the "difficult circumstances" Syrians currently face.

The statement follows a report on Monday by Syria's state-run news agency that Syrians would not be able to perform the Hajj because Saudi authorities had failed to agree on details in time.

Countries normally agree on numbers of worshippers to make the pilgrimage ahead of time.

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A leading Islamic organization signalled on Wednesday that it will revive long-standing attempts to make insults against religions an international criminal offence.

The bid follows uproar across the Muslim world over a crude Internet video clip filmed in the United States and cartoons in a French satirical magazine that lampoon the Prophet Mohammad.

Ekmeleddin Ihsanoglu, secretary-general of the Organisation of Islamic Cooperation (OIC), said the international community should “come out of hiding from behind the excuse of freedom of expression”, a reference to Western arguments against a universal blasphemy law that the OIC has sought for over a decade.

He said the “deliberate, motivated and systematic abuse of this freedom” were a danger to global security and stability.

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Iran's oil minister said on Wednesday that crude exports were rebounding after being hit by a European embargo in July, describing for parliament the strategies by which the Islamic Republic says it is countering punitive measures imposed by the West over Tehran's nuclear program.

Rostam Qassemi did not provide figures. But some analysts say that exports have fallen in July by as much as 40 percent, hitting a sector that counts for four-fifths of the country's foreign revenue.

His comments carried by the semiofficial Mehr news agency appear part of wider efforts by Iranian officials to show that the country can ride out the sanctions.

"We have no problem selling our oil," Qassemi said. "Iran's crude oil exports are increasing. With the increase in exports, the way has been paved for more currency income."

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Turkey is talking to Libya, Saudi Arabia and Russia about buying more of their oil to make up for a shortfall in crude imports from Iran due to a Western embargo, Turkish Energy Minister Taner Yildiz told Reuters on Wednesday.

Yildiz said Turkey had started buying oil from Saudi Arabia on the spot market in addition to purchases from Libya, and that its sole refiner Tupras hoped to reach an agreement with Riyadh on long-term import contracts later this year.

"One of our core strategies is to increase the number of supplier countries and alternative routes. We buy oil from 11 countries and natural gas from five. We aim to increase that to 13, or 15 if possible," Yildiz said.

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Iraq reopened its main Al Qaim crossing with Syria to refugees on Tuesday, after closing it for several weeks, but continued to deny entry to single men under 50, an Iraqi official said.

Amr Al Khafaji, a spokesman for the displacement and migration ministry, which oversees the refugee camp at Al Qaim, told AFP that 150 people had crossed from Syria on Tuesday.

But unmarried male Syrians under the age of 50 remain barred from entering Iraq, Khafaji said, a policy apparently aimed at keeping out military-age men who may pose a security threat.

The crossing had been closed since August 15 for “security reasons,” Khafaji said.

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The US State Department has updated its travel warning to Lebanon amid a number of anti-American protests in the Middle East, and suspended grants to Americans wishing to study in the country, AFP has reported.

The travel advisory highlighted a spate of recent kidnappings of foreigners in the country by different groups and clans, and the tensions caused by the conflict in Syria.

"US citizens living and working in Lebanon should understand that they accept risks in remaining and should carefully consider those risks," the advisory said.

"US citizens travelling or residing in Lebanon despite this travel warning should keep a low profile, assess their personal security, and vary times and routes for all required travel," it added.

More from AME Info

 

September 20, 2012 0 comments
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Morning briefing: 19 Sep 2012

by Executive Staff September 19, 2012
written by Executive Staff

A video showing US Republican Presidential candidate Mitt Romney saying the Palestinians are opposed to peace with Israel has been released on the internet.

In a private speech to party donors, which was secretly filmed, Romney said the “Palestinians have no interest whatsoever in establishing peace, and the pathway to peace is almost unthinkable to accomplish.”

He suggests an independent Palestinian state is unviable and that his strategy towards the issue will be to “kick the ball down the field".

The video is from the same event as a clip released on Monday, in which Romney says almost half of Americans "believe that they are victims".

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Lebanon, whose political stability is threatened by escalating violence in neighboring Syria, sold its first 10-year local currency debt amid growing confidence in the country’s economy, Central Bank Governor Riad Salameh said.

The sale this week raised more than 1 trillion Lebanese pounds, or about $700 million, at a rate of 8.24 percent, Salameh said on Tuesday.

The Finance Ministry is also planning a 10-year dollar-denominated sale, he said.

Confidence in the nation’s currency is stable even after sporadic clashes in the northern city of Tripoli between supporters and opponents of Syrian President Bashar Assad killed dozens of people.

Deposits have grown at an annualized rate of 7 percent this year, Salameh said.

“We have seen a demand on the Lebanese pound, so we were not affected really by the Syrian situation,” he said.

More from the Daily Star

Prince Alwaleed bin Talal, billionaire nephew of Saudi Arabia's king, has said that only a minority were involved in violent anti-US protests over a film mocking the Prophet Mohammad.

Known for his investments in some of the world's top firms including Citigroup, Alwaleed said that reforms in his homeland, the world's top oil exporter, were not going fast enough and that Arab states must learn lessons from Arab Spring revolts to avoid being swept by more violence.

"This despicable and disgusting 12-minute movie is really unacceptable, but having said that we shouldn't honor [it] with such demonstrations and give it so much attention," he said.

"I hope these demonstrations will subside. You have to remember [that] those who go on the street and shout are the minority. Islam is a lot stronger and resilient."

More from Arabian Business

The Iraqi Cabinet has ratified a plan to pay the semi-autonomous Kurdistan region for its oil exports.

Under the agreement, the Kurdistan Regional Government (KRG) will increase exports to 200,000 barrels per day (bpd) this year and will average at least 250,000 bpd in 2013.

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Egyptian beach resorts are to remain, the tourism minister in the Islamist-led administration has said, adding that any Islamic investment in the sector would complement but not replace resorts that are part of an industry vital to Egypt.

Hisham Zaazou is tasked with reviving an industry that accounted for 10 percent of economic activity before an uprising toppled Hosni Mubarak 19 months ago, sending both investors and tourists packing.

Zaazou dismissed concerns that the Islamist nature of the government would mean the sector being more tightly regulated.

“It will not be changed. Nothing will affect beach tourism. We are building on, increasing even, the capacities and the services rendered for our clients coming to our beaches,” he said.

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And finally…

Twitter appears to be beating Facebook in the battle to be the Gulf's social network, at least among women.

A joint study by Dubai's Zayed University and New Zealand's Massey University showed that women in the UAE are three times more likely to use Twitter on a daily basis than their counterparts in the US.

In general the women said they did not like the more complex layout of Facebook, with many leaving the network.

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September 19, 2012 0 comments
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The Buzz

Morning briefing: 18 Sep 2012

by Executive Staff September 18, 2012
written by Executive Staff

Brent crude rose to near $114 a barrel on Tuesday, after steep losses in the previous session, but gains were limited as investors weighed the impact of the U.S. Federal Reserve's stimulus push on oil demand and eyed China's next step to boost its economy.

Brent crude fell more than $5 a barrel late on Monday in a wave of late, high-volume selling that many traders said appeared to have stemmed from an automated computer trading program.

Brent crude for November delivery was up 46 cents at $114.25 a barrel by 0221 GMT. Brent, which had settled at $116.66 a barrel on Friday in its seventh straight session of gains, sank on Monday from $115.20 at 1752 GMT to $111.60 three minutes later as trading volumes shot up.

More from Arabian Business

Gold edged lower in volatile trade on Tuesday after commodity markets plunged overnight and investors booked profit from a recent rally sparked by the Federal Reserve's aggressive round of stimulus efforts.

But worries that central bank money-printing will ultimately stoke inflation could prompt more buying in gold, which rallied to its highest in nearly seven months last week after the Fed launched a third round of bond buying.

Gold dropped $4.21 an ounce to $1,756.74 by 0247 GMT.

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Qatar Airways, the Gulf state's flag carrier, made a small net loss in the last financial year which ended in March because of high oil prices, its chief executive said on Monday.

"We had a very small loss because of the huge increase in oil price," Akbar al-Baker told reporters.

"Profit on an EBITDA (earnings before interest, taxes, depreciation and amortisation) level was 47 percent above the previous year, but on a net level we made a small loss. For the 2010-2011 financial year, we made a substantial profit."

He did not elaborate. Qatar Airways, which is not listed on a stock market, does not regularly disclose its earnings.

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Saudi Arabia is expecting more than 1.8m foreign pilgrims and around 1m domestic pilgrims to perform Hajj this year, Hajj Minister Bandar Hajjar told the Saudi Press Agency.

Last year, approximately 2.5m Muslims are estimated to have travelled to Mecca to undertake the Islamic pilgrimage.

In August, authorities announced plans to invest US$16.5bn in improving transport infrastructure in the holy city, including the building of a bus network and metro system.

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Weapons traffickers are stepping up their arms purchases in Iraq's southern provinces, in a widespread smuggling effort to back the uprising in Syria.

To date, much of the Iraqi support for the Syrian uprising has come through Anbar province, a Sunni stronghold, which shares a long western border with Syria.

But now that rebel network appears to be spreading into the Shiite-majority south – a development that is causing Iraqi leaders to worry that Syrian unrest is straining Iraq's sectarian system.

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The Lebanese Ministry of Finance has backed an oil and gas summit due to take place later this year.

Lebanon has recently discovered large quantities of offshore oil and gas and has been seeking foreign investors.

The Lebanon International Oil and Gas summit is due to be held in December, with both the Ministry of Energy and Water and the Ministry of Finance backing it.

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September 18, 2012 0 comments
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The Buzz

Morning briefing: 17 Sep 2012

by Executive Staff September 17, 2012
written by Executive Staff

The leader of the Lebanese anti-Israeli group Hezbollah has called for fresh protests in the country on Monday over a film deemed offensive to Muslims.

The world needed to know Muslims "would not be silent in the face of this insult", Hassan Nasrallah said.

Protests at many US diplomatic missions have been continuing over the film, which was made in the US.

One person was reportedly killed in clashes between protesters and police in Pakistan on Sunday.

In a speech broadcast on Hezbollah's al-Manar TV station, Sheikh Nasrallah called for demonstrations on several days over the coming week.

The first is scheduled to take place on Monday afternoon in a southern suburb of Beirut which is a Hezbollah stronghold.

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Saudi Arabia's Grand Mufti over the weekend denounced attacks on diplomats and embassies as un-Islamic.

Sheikh Abdulaziz bin Abdullah Al al-Sheikh also called on governments and international bodies to criminalise insults against prophets and excoriated the film that has prompted a wave of fury across the Middle East.

"It is forbidden to punish the innocent for the wicked crimes of the guilty, or to attack those who have been granted protection of their lives and property, or to expose public buildings to fire or destruction," he said in a speech carried by state news agency SPA.

More from Arabian Business

Warships from around the world assembled in the Gulf on Sunday for what the US military described as the most widely attended international naval exercise ever held in the Middle East.

The games, which Washington says involves manoeuvres to improve mine detection and clearance, comes at a time of rising regional tensions over Iran's controversial nuclear program.

Tehran has threatened to block the Strait of Hormuz, through which 40 percent of the world's sea-borne oil exports passes, and target US military bases in the region if it was attacked.

The US Naval Forces Central Command said that the International Mine Countermeasures Exercise 12 involved vessels and officials from 30 countries in six continents. It did not name the participating nations.

More from Reuters

Yemen has invited international companies to bid for exploration and development rights in five oil blocks around the country as it gives top priority to building up its oil output and reserves, the oil minister said on Sunday.

State news agency Saba quoted the newly appointed oil and minerals minister, Ahmad Dares, as saying the auction aimed to attract foreign investment and increase exploration operations.

The blocks on offer are 6, 15, 84, 85 and 102, which are located in the Al-Saba’ateen basin, the Say’un-Masila basin, and the basin of Mukalla-Sayhoot, Dares told Saba.

Yemen is a small producer with proven oil reserves of 3 billion barrels as of Jan. 1, 2012, according to the U.S. Energy Information Administration.

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Lebanon’s 2012 GDP growth is unlikely to exceed 1.2 percent by the end of 2012, and the country could enter recession in the third quarter, according to the Washington-based Institute of International Finance.

Lebanon’s economy contracted by 0.3 percent in the second quarter, a report issued by the institute added, according to a report by Lebanon This Week, the economic publication of Byblos Bank.

Expecting the economy to contract another 0.5 percent in the third quarter of 2012, the report argues the Lebanese economy would officially enter a state of recession. Recession is defined as two consecutive quarterly contractions in real GDP.

The new report is in line with most projections of economists and international investment banks, which gave a bleak picture of the Lebanese economy.

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The head of the Suez Canal Authority expects revenue in 2012 to be no lower than the $5.2 billion made in 2011, he said.

Mohab Memish said revenue had risen  to $446.6m in August, up 3 percent from July.

The canal was among the most profitable entities in the country, providing a vital source of foreign currency, tourism, oil and gas exports and remittances from Egyptians living abroad, he added.

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Turkey has agreed during a visit by Egyptian officials to Istanbul to provide Egypt with a US$2bn financing package, Egypt's finance minister said on Saturday.

Egypt's new government has been seeking foreign help to plug twin deficits in its budget and balance of payments that have mushroomed since last year's popular uprising. Last month it formally asked the International Monetary Fund for a US$4.8bn loan.

Mumtaz al-Saeed said he could not yet say whether the Turkish financing would include any direct budget support.

More from Arabian Business

Current oil prices above $100 a barrel are no threat to the world economy and political pressure on producers to raise output is driven by the approach of U.S. presidential elections, Iran’s OPEC governor Mohammad Ali Khatibi said Sunday.

Benchmark Brent crude prices rose to nearly $118 a barrel Friday, further stoking fears that surging energy costs could harm fragile economic growth just days after Saudi Oil Minister Ali al-Naimi said he was worried by high prices and the kingdom would take steps to moderate them.

Iranian oil officials say oil prices are still fairly low and deny there is any danger of current prices hampering growth.

Khatibi, who represents Iran on the board of governors of the Organization of the Petroleum Exporting Countries told the Oil Ministry news website Shana that even price-sensitive consumers see $100 a barrel as fair.

He argued that prices a “few dollars” above that level are unlikely to upset Western economies.

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September 17, 2012 0 comments
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Banking & Finance

For your information

by Executive Editors September 14, 2012
written by Executive Editors

Tighter times for Lebanese banks

Lebanese banks’ first-half results have revealed tougher market conditions. Overall for the banking sector, deposits grew by just $3.2 billion in the first five months of the year, 13 percent less than the average growth of the past five years. The three largest banks in Lebanon, Bank Audi, Blom Bank and Byblos Bank, took provisions totaling some $150 million in the first half of the year as a risk precaution in case of defaults, given the uncertain economic conditions in Lebanon and neighboring Syria. Bank Audi, Lebanon’s largest bank by assets, reported net profits of $230 million for the first half of the year, growing by 28 percent over the same period last year. Removing the profits made through the June sale of its 81 percent stake in LIA Insurance Company to Saham Finances, an African insurance company, the profit growth falls to less than 6 percent. Audi also took provisions of $68 million. Blom Bank, Lebanon’s second largest bank by assets, reported first-half net profits of $165 million on July 31, up by just one percent on the same period last year — it took provisions of $60 million. Byblos Bank, Lebanon’s third largest bank by assets, reported profits of $80 million in the first half of the year, flat on the same period of last year, while allocating provisions of $23 million.

U.S. seizes $150 million in ‘Hezbollah funds’…

The United States authorities announced they had seized $150 million that they claim was used by Hezbollah entities to launder money. The seizure is the result of a civil complaint filed in 2011 in New York against the now defunct Lebanese Canadian Bank, acquired by Société Générale de Banque au Liban (SGBL) in September 2011 for $580 million. The lawsuit asserts that entities linked to Hezbollah were channeling funds from Lebanon into the US financial system between January 2007 and early 2011 to acquire used cars to then sell in West Africa for cash, which was then transferred back to Lebanon along with funds from drug sales and other crimes. SGBL placed the $150 million in escrow at a New York correspondent account of Lebanon’s Banque Libano Française (BLF) pending the lawsuit. BLF and SGBL are not accused of any wrongdoing according to the prosecutors.

…and scrutinizes banks for Iran dealings

Standard Chartered Bank (SCB), Deutsche Bank and Royal Bank of Scotland (RBS) are the latest banks in the hot seat for their dealings in Iran. New York’s superintendent of Financial Services Benjamin Lawsky accused United Kingdom-based SCB last month of helping Iranian banks and corporates hide some 60,000 transactions worth at least $250 billion, between 2001 and 2010. SCB agreed to pay a record $340 million penalty to settle the charge and prevent the revoking of their New York license. The regulator is also accusing the bank of having similar schemes with other countries sanctioned by the United States, such as Burma, Libya and Sudan. Lawsky said the “rogue bank” is being aided by its consultant Deloitte & Touche, an accusation that Deloitte’s Chief Executive Joe Echevarria considers “distortions of the facts.” Deutsche Bank is also being scrutinized by US authorities according to the New York Times, but with the investigation still at an early stage, no accusations have been put forth as Executive went to print. RBS has volunteered information to the UK and US regulators concerning its dealings with Iran following an internal review.

Death sentences in Iran banking scandal

An Iranian court sentenced four people to death on July 30, following a billion-dollar bank scandal that came to light in September 2011. The court sentenced two others to life imprisonment and several received sentences ranging up to 25 years. 39 people were sent to trial for the fraud. The scandal, one of the biggest frauds in the Islamic republic’s history, involved several Iranian banks and caused losses amounting to a staggering $2.6 billion over more than two years. The financial scandal involved the forging of documents to secure credit from various financial institutions, including Bank Saderat, one of the largest in the Middle East. The proceeds were then used to purchase state-owned enterprises, such as the Khuzestan Steel Company, as the government implemented its controversial privatization scheme, which began in 2004. Back in October, Kayhan, a conservative newspaper under the direct supervision of the Office of the Supreme Leader, had identified the suspect as billionaire mogul Amir-Mansour Aria, and alleged complicity on the part of President Mahmoud Ahmadinejad’s top ally, chief of staff Esfandiar Rahim Mashaei. Ahmadinejad denies Mashaei’s link to the scandal.

Lebanese banks under cyber attack

Remember Stuxnet? That was the computer virus discovered in June 2010 that attacked Iran’s nuclear program and which in June this year was reported by the NY Times to be part of an American-Israeli intelligence operation. Now it’s the turn of Lebanese and Arab bank accounts to come under cyber attack from a virus dubbed Gauss — after an apparent reference to the German mathematician Carl Gauss that was found in the code — which is capable of stealing browser passwords and online banking account details. Moscow-based cyber security firm Kaspersky Labs, which discovered Stuxnet, also uncovered Gauss and is having a difficult time cracking the code, pleading for help on their website. “We’re talking about a complex package (…). It maintains code and has similar functionality to Flame and Stuxnet,” says senior security researcher Kurt Baumgartner. Flame and Stuxnet both have the ability to rewrite code; Stuxnet rewrote code leading to enrichment centrifuges in Iran to go out of control and become useless. So far, Kaspersky Labs has detected Gauss on more than 2,500 computers in the Middle East, of which approximately 1,600 are in Lebanon and nearly 500 in Israel. Bank of Beirut, Blom Bank, Byblos Bank and Credit Libanais have been affected, according to the Russian security firm, as well as Citibank and Paypal. While the origin of the virus is still unclear, Kaspersky Labs said it believed it was built in the same laboratories as Stuxnet, Flame and Duqu, another espionage virus.

Egypt requests $4.8 billion from the I.M.F.

Egypt’s president Mohamad Morsi has asked Christine Lagarde, the International Monetary Fund’s (IMF) chief, for a $4.8 billion loan to cover the country’s budget deficits. Talks between Egypt and the IMF have been ongoing ever since president Hosni Mubarak was deposed last year, but a deal failed to go through as the IMF required broad political support as a key condition for the loan. Following the formation of a government by President Morsi and his dismissal of top army generals, the deal is expected to be given the green light, with Lagarde stating that, “It is going to take a bit of time and we feel that we have perfectly competent authorities to negotiate with.” Egyptian Prime Minister Hisham Kandil expects the loan to be signed by the end of the year and be for five years, with a grace period of 39 months and interest rate of 1.1 percent. With limited alternative options, the Egyptian government had to borrow a hefty $12 billion from its central bank in the 12 months to June 2012.

Qatar investment spree continues

This time, Qatar goes after China as its sovereign wealth fund, Qatar Investment Authority (QIA), acquires a 22 percent stake in a Chinese investment fund, CITIC Capital Holdings, known for its investments in real estate and private equity. CITIC is partly owned by CIC, China’s sovereign wealth fund. While the size of the investment was not disclosed, the deal is expected to have a significant impact as it links two major sovereign wealth funds. Back in the United Kingdom, a country Qatar is very familiar with through its numerous investments, the peninsula has been eying a stake in UK-based airport operator BAA, owner of London’s Heathrow airport, the third busiest airport in the world. Qatar Holding is set to acquire a 20 percent stake for £900 million ($1.4 billion) in BAA from Ferrovial, the Spanish company owning 49 percent of the operator. Qatar will become the third largest shareholder in BAA after completion of the deal. “This acquisition is a key element in our exposure to the infrastructure sector,” said QIA in a press release.

Lebanese companies’ appetite to open up for capital

According to a survey of 100 Lebanese companies by BEMO Securitization, the structured finance unit of Banque Bemo, 48 percent of Lebanese companies would be willing to open up their capital to new investors. The vast majority of these companies operate in capital-intensive sectors, such as industry, with startups making up 40 percent and well-established companies comprising the remaining 60 percent. One third of Lebanese companies have no interest in opening up their capital and would not issue preferred shares (a class of ownership with higher claims on assets than common shares but with no voting rights), with most of the companies within this category made up of well-established family owned businesses operating in sectors that are not capital intensive, such as the trade sector. The final 19 percent of surveyed companies would consider issuing preferred shares, with half of these companies being well-established family-owned businesses in non-capital intensive sectors.

September 14, 2012 0 comments
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Morning briefing: Sep 14 2012

by Executive Staff September 14, 2012
written by Executive Staff

The leaders of Iraq's central government and its autonomous Kurdish region edged closer to an agreement on oil revenues, with both parties signing a new deal.

The deal – if implemented – will increase Kurdistan’s oil exports and re-start Baghdad’s payment to contractors.

"An agreement was made in principle to pay the entitlements" to the companies producing oil under contracts awarded by the Kurdistan Regional Government, an official who was in the meeting said.

More from Iraq Oil Report

The Lebanese government invited international firms to bid for the construction of a 60-megawatt wind farm, Energy Minister Gebran Bassil announced.

“It would be possible to produce wind energy and sell it to Electricite du Liban after the conclusion of the tender, which awaits approval by the Cabinet,” Bassil said during the opening of the Beirut Energy Forum.

The minister said the tender would allow the production of cheaper electricity cheaper.

Lebanon suffers from chronic electricity rationing due to low energy production, particularly in the summer months.

More from the Daily Star

The Royal Bank of Scotland and two other banks began legal proceedings against an investment vehicle owned by Dubai’s ruler, seeking immediate repayment after abandoning talks to restructure $10 billion in debts.

RBS, along with German lender Commerzbank and South Africa’s Standard Bank, abandoned talks on restructuring Dubai Group’s liabilities in July and had threatened legal action.

Legal action to reclaim debt owed has been unprecedented in an emirate where banks have tended to take the best terms on offer due to an opaque legal system and to avoid jeopardising chances of winning future business.

More from the Washington Post

Newly independent South Sudan has decided to break up a massive oil concession largely held by Total into three blocks, granting one to the French energy company and the others to two foreign firms, government officials said.

One oil industry source identified the other two operators as U.S. firm Exxon Mobil and Kuwait's Kufpec, which had already claimed about a quarter of the mostly unexplored block, known as Block B.

Total, Exxon Mobil and Kuwait Petroleum Corp, the state-owned parent firm of Kufpec, all declined to comment.

More from Reuters

EU leaders offered Egypt more than a billion euros in aid and better trade terms as President Mohammed Morsi flew in for his first visit to Europe pledging to support democratic values and freedoms.

The lightning trip, followed by a visit to Rome, came amid violent anti-US protests over a film deemed insulting to Islam that led to the killing of four US officials in the Libyan city of Benghazi.

 

European Commission head Jose Manuel Barroso said the EU was making available 449 million euros to Egypt for 2011-2013 but was "willing to do much more," Barroso said.

More from Oman Tribune

Jordan was reviewing offers from a group of banks to manage a eurobond sale of as much as US$1.5bn to help finance government spending, Finance Minister Suleiman Hafez said.

"A specialised committee from the Ministry of Finance and the Central Bank of Jordan is currently studying the offers to pick the best offer in terms of interest rates and issuance costs," the minister said, according to the state run Petra News Agency.

The government plans to raise between US$750m and US$1.5bn in the sale and will announce the shortlisted banks soon, Petra reported, citing Hafez. The debt instruments would be paid over a period of seven to ten years, the minister said.

Jordan's government is issuing the bonds "in order to strike a balance between domestic and external borrowing and provide the kingdom with a new financing instrument with a lower interest rate," Hafez said.

More from Arabian Business

Al Arif Contracting has been awarded the contract for the construction and maintenance of the UAE’s first eco-friendly mosque, and what will also be Dubai’s largest mosque upon completion in 18 months time.

The 3,500-worshipper mosque is to be built on a 9,755 sqm plot near the Clock Tower Roundabout in the Bur Saeed area of Dubai’s Deira.

AMAF secretary ceneral Tayeb Al Rais said: “Al Arif has a track record of shaping major construction projects in the UAE, and has proven experience in the implementation of projects that support environment preservation and sustainability factors.

“Following the successful completion of this landmark initiative, AMAF aims to transform a large number of mosques in Dubai to eco-friendly mosques and adopt green building standards to contribute to Dubai’s sustainable development plans.”

More from Arabian Business

 

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Economics & Policy

The Pope in Lebanon: the numbers

by Joe Dyke September 13, 2012
written by Joe Dyke

Pope Benedict XVI arrived in Lebanon on Friday, 14 September 2012 for a three-day trip in which he was expected to call for peace across the Middle East. Executive gives you the key facts you should know about his first visit to the country.

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Economics & Policy

Collusion over our heads

by Zak Brophy September 13, 2012
written by Zak Brophy

Protesters burning tires on the airport road and the tit-for-tat kidnappings gripping the nation’s attention may justly be blamed for diverting planes and visitors away from Lebanon. However, protectionism and expedient political maneuvering may be responsible for a more insidious affliction in the country’s civil aviation, and the saga at Beirut airport surrounding one relatively minor executive jet operator perhaps best illustrates the culture dominating the sector.

Not welcome

Imperial Jet was established in Germany in 1983 but decided to set up a regional hub in Lebanon in early 2006. Other aviation hotspots in the neighborhood — such as Dubai, Saudi Arabia or Jordan — may have seemed like more logical choices but “Lebanon was underserved,” says Mohamed Alem, board member and external legal advisor to Imperial Holding. “It’s a great strategic location and it wasn’t really on the international aviation scene. We felt we could make a difference.”

Within a couple of years the company had consolidated itself firmly within the Middle Eastern executive aviation sector and from 2006 to 2008 bought nine aircraft, representing an initial investment of close to $200 million. Imperial Jet, either by good fortune or by shrewd assessment, had set up shop in Lebanon at a time when the aviation sector was on the up. The national carrier, Middle East Airlines (MEA), had been turned from a hemorrhaging and bloated beast into a multi-million dollar profit-making company, an aviation law had been passed by Parliament, the airport had been expanded and Lebanon’s aviation sector had been liberalized with the adoption of a complete Open Skies policy. Former Prime Minister Rafiq Hariri’s relentless pursuit of profits and ambition to restore Lebanon to its former glory as the region’s foremost business hub was the driving force behind these developments.

However, despite their promising start, by late 2008 Imperial Jet’s fortunes in Lebanon had begun to turn as relations with the authorities took a nosedive. Among the planes the company operated was a Boeing 737, which the Directorate General of Civil Aviation (DGCA) ruled was not fit to fly to Europe. When the company challenged this move at the Shura Council — Lebanon’s highest court and the legal body that determines the constitutional and legal authority of governmental decisions — the DGCA struck the Boeing 737 from the national register, meaning no airline could fly this model in or out of Lebanon. Again, Imperial Jet challenged this at the Shura Council.

Alem says when it became apparent that Imperial Jet was going to put up a fight, all of the company’s operational licenses at Beirut Rafiq Hariri International Airport, including two Air Operating Certificates (AOC) and one Fixed Base Operation (FBO), were revoked. “Somewhere between the Ministry of Public Works and Transport and the DGCA somebody decided that no matter what, they were not going to allow us to operate,” says Alem.

 

Friends with benefits

The head of the DGCA during this period was Hamdi Chaouk, a Lebanese aviation expert who had spent 30 years working in civil aviation in Australia, America, Europe and Dubai before returning to Lebanon in 1999. Hariri put him at the forefront of the restructuring of the Lebanese aviation sector and he stayed in his post at the DGCA until late 2010. The initial reasoning for revoking the licenses was, according to Chaouk, because of a series of management problems at Imperial Jet in which key posts, such as director of operations, chief pilot, director of maintenance and director of quality — all of whom are named on the AOC — were often changed and sometimes left vacant without the DGCA being informed.

However, after they were stripped of their licenses he admits the company got their act in order and fulfilled everything that was obliged of them. Chaouk says he advised his boss, the Minister of Public Works and Transportation Ghazi Aridi, to reinstate the company’s licenses, but such was not to be.

“It changed from being a technical problem to becoming a political issue completely,” argues Chaouk.

The company continued to fly to and from Beirut via the European arm of the business and on a German AOC until the DGCA made the decision to stop granting landing rights to Imperial Jet Europe. Despite two Shura Council decisons in favor of Imperial Jet regarding the European flight ban and the deregistration of the Boeing 737 as well as two interim rulings for the suspension of the DGCA decision to revoke the company’s licenses, no Imperial Jet aircraft is permitted to land at Beirut airport. The company claims this deprives the airport of what would be millions of dollars in annual airport fees. While Imperial Jet still has its headquarters in Beirut it is solely an administrative hub of some 70 staff.

It is not so much the technical or legal intricacies of the struggle between Imperial Jet and the Lebanese aviation authorities that is most illuminating but rather the cause of the dispute. Imperial Jet argues that there are two main reasons: First they gripe that they did not enter into the Lebanese business of “making friends” within the administration and making sure the right people got their cut of the pie. While Chaouk would not divulge details, he conceded that Imperial Jet was in the end targeted for personal and political reasons as opposed to any technical or professional rationale.

What is more, the company complains that there is resistance from the Lebanese companies operating at the airport — many of whom are affiliated with powerful business and political figures — to foreign outfits muscling in on the sector. “All of the talk of attracting foreign investment into Lebanon is false and misleading,” quips Alem.

Indeed, Captain Mohammed Aziz, spokesman for MEA, says, “If you completely open up the market, lots of people from outside Lebanon will come into the market and invest money and kick you out in no time.”

 

The man at the top

While Chaouk was head of the DGCA signing the papers that were squeezing Imperial Jet off the runway, the ultimate authority was coming from Minister Aridi. When challenged on why, despite the Shura Council rulings, Imperial Jet had been denied use of the airport — from ground handling to airplane management — the minister refused to offer details. Nonetheless, his resolve was unequivocal. “I know the file very well, and I have taken the decision and I am insisting on keeping on the same way. This is my decision,” said Aridi, before slamming the table.

Imperial Jet’s tribulations in Lebanon are perhaps indicative of a change in the philosophy and management of the whole of the aviation sector, one that is stifling its development. Chaouk, one of the principal architects of Lebanon’s aviation revival, says he eventually resigned in frustration  from the DGCA in late 2010. Watching his vision of liberalizing Lebanon’s aviation sector get squashed, under what he claims is political interference and self-serving protectionism, led to his eventual bowing out of office. In any case Chaouk argues that his role as the head of the DGCA was eventually stripped of virtually all authority, which he claims left him for the last few years of his tenure, “with my hands tied.”

When Lebanon signed up to the Open Skies agreement in 2001 it included the 5th freedom, which meant there were to be no limitations on the flights offered to and from Lebanon on the basis of airline, type of airplane or number of seats. While this policy was applied for several years it appears that Lebanon is now regressing on this commitment. “We went from a very open system to one that is practically implemented in line with MEA’s desire to reject flights it sees as a challenge,” gripes Chaouk. “We are not following the Open Skies policy but we are selective on the whims of MEA.”

The reach of MEA

Banque du Liban, Lebanon’s central bank, is the 99 percent owner of MEA, and yet the company is still listed as private. In addition to the airline, under the MEA umbrella are also MEA Ground Handling (MEAG), Middle East Airport Services (MEAS), Mideast Aircraft Services Company (MASCO), as well as a 77.5 percent stake in the airport’s primary catering company Lebanese Airport Catering Company (LACC). While not all of these companies hold a monopoly in their field of operations at the airport, it is clear that MEA’s interests extend into every corner of operations at Beirut airport.

Management at MEA, however, deny there is any resistance to competition; indeed they say they welcome it. Captain Aziz claims that the reason many companies have stopped flying, or at least cut back on their routes to Lebanon, is not so much because they have been refused the routes they requested but rather there simply is not the market there to maintain them. “MEA is always open to competition when it is fair competition,” he says. “There are a lot of competition and anti-trust regulations and if the licensing and the Open Skies policy is followed in accordance with these regulations then MEA has no problem.”

Regardless of their approach, what is perhaps most disconcerting is the power MEA has come to wield over the decision-making process for the sector as a whole. By the minister’s own admission, it is MEA and the DGCA that now make the decisions regarding who gets to fly in and out of Lebanon and when. According to Chaouk, affording MEA this authority is in complete contradiction to Law 442, which pertains to the aviation sector and was passed by Parliament in 2002. It is important to note that since Chaouk’s resignation, which is yet to be accepted by the government, the president of the airport is sitting as merely an acting head of the DGCA and therefore lacks the same clout that Chaouk had, even with his “hands tied”.

 

The damage of the status quo

Indeed, in recent months the Minister of Tourism Fadi Abboud has locked horns with the MEA President Mohammad Hout and Minister Aridi, claiming they are resistant to opening up routes for budget airlines because they are fearful of the competition it will bring. “Lebanon is losing valuable tourism dollars so MEA can profit,” reasons Michel Habis, advisor to Minister Abboud.

There is potential for a very damaging blowback for Lebanon’s aviation sector from these trends. If the country starts adopting protectionist measures that hurt foreign airlines or if foreign airlines, such as Imperial Jet Europe, are targeted for patently personal and political reasons, then foreign aviation authorities can play tit-for-tat against Lebanese airliners. “There is a chance that if any airline operator felt that Lebanon was not implementing its bilateral agreements properly or not really treating all airlines fairly, they can always take certain measures to upset the whole issue,” explains Chaouk.

Whether anybody is still paying any heed to Law 442 is further brought into question by the fact that the legislation stipulated that an autonomous Lebanese Civil Aviation Authority (LCAA) must be created to regulate the sector. Almost 10 years later and no board has been appointed to the LCAA; Minister Aridi assured Executive that by the time this story was printed the board would have been named; no board had been appointed, however, as Executive’s September issue went to print.

“The creation of this body would lead to the autonomy of the LCAA as a regulator, which would kill the existing political decision making within the organization,” explains Chaouk.

The vitality of Lebanon’s aviation sector feeds the economy by acting as a lifeline for business, trade and tourism. The case of Imperial Jet hints at how the business culture of “making friends” and having the right connections is hobbling a real growth. Aviation in Lebanon should not be another closed club in the economy profiting a small clique of the nation’s rich and powerful — the wealth and opportunity they are hoarding harms not just the prospective tourist or businessman, but Lebanon as a whole.

September 13, 2012 0 comments
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The Buzz

Morning briefing: 13 Sep 2012

by Executive Staff September 13, 2012
written by Executive Staff

Saudi Arabia's annual inflation eased to 3.8 percent in August, its lowest level in almost three years, government statistics showed.

Slower increases in rents were highlighted as the cause of the slowdown.

Consumer price growth in the world's top oil exporter has been slowing gradually since peaking at 5.4 percent in February and March, registering 4.0 percent in July.

More from Arabian Business

President Barack Obama has vowed to bring to justice the killers of the US ambassador to Libya and three other diplomats after they were murdered by Islamist protesters.

Obama condemned the attack in Benghazi as "outrageous and shocking" but insisted it would not threaten relations with Libya's new elected government, which took power in July after rebel forces backed by NATO air power overthrew Muammar Gaddafi.

The targeting of US diplomats was sparked by a US-made film seen as insulting the Prophet Mohammad.

More from Reuters

The world’s tallest residential building, Princess Tower, has been officially delivered by its developer Tameer in Dubai.

The building, which cost Dhs1.5 billion ($408 million) to build and measures 414 metres in height, is 98 per cent sold to investors, Tameer said.

The tower offers 763 individual residential units, and Tameer has handed over 150 units in the last six weeks.

Prices for the apartments vary from $326 to $680 per square foot, with apartment sizes ranging between 800 and 2,300 square foot.

More from Gulf Business

Gulf Bank won a leading role in financing two energy projects in Kuwait worth a combined $2bn, the bank's chief executive said.

"One is in the oil sector and one is in the power sector. One is a bit less than $1bn, the other is a bit more than a billion. So, the total is roughly $2bn," Michel Accad said in an interview.

The deals will increase Gulf Bank's market share in corporate and project financing in the local market despite deep concerns over government willingness to speed up long-awaited infrastructure projects.

More from Arabian Business

Israel is undermining Jordan's efforts to establish a nuclear program that would help the country to become fuel sufficient, Jordan's King Abdullah said.

The country, which has one of the smallest economies in the Arab world and almost no natural resources, suffers from energy shortages.

"Strong opposition to Jordan's nuclear energy programme is coming from Israel," the monarch told Agence France Presse in an interview.

"When we started going down the road of nuclear energy for peaceful purposes, we approached some highly responsible countries to work with us. And pretty soon we realised that Israel was putting pressure on those countries to disrupt any cooperation with us," King Abdullah said. "A Jordanian delegation would approach a potential partner, and one week later an Israeli delegation would be there, asking our interlocutors not to support Jordan's nuclear energy bid," he added.

More from The Nation

Egypt's finance minister said the government had revised up its budget deficit for the 2011/12 fiscal year to 11 percent of gross domestic product from an earlier projection of 8.6 percent.

The deficit was EGP170bn ($27.92bn) in the year that ended on June 30 and not the EGP134bn ($21 billion) projected earlier, Mumtaz al-Saeed said.

More from AMEInfo

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Since its first edition emerged on the newsstands in 1999, Executive Magazine has been dedicated to providing its readers with the most up-to-date local and regional business news. Executive is a monthly business magazine that offers readers in-depth analyses on the Lebanese world of commerce, covering all the major sectors – from banking, finance, and insurance to technology, tourism, hospitality, media, and retail.

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