I found the following links educational + informative.
7Stars Worldwide
A World of Dreams
Alam Assaat Wal Moujawharat
Arabian Watches & Jewellery
Bangkok Gems & Jewellery Magazine
Bijoux, montres & Vous
Brilho Fashion
BRJ Brasil Relógios & Jóias
China Gems Magazine
China Gold News
China Jewelry and Gold
CHRONOS China
CHRONOS Japan
CHRONOS Polen
Collection
Contessa Magazine
Cronos
Tuesday, December 19, 2006
Gem Business News
The Sri Lankan gemstone dealers are in town. They are downloading colored stones to potential buyers at competitive price (s). The political, social, business landscape in Sri Lanka has become unpredictable, and for this reason the local market is going to see more colored stones of all species and varieties. The dealers need cash and may be willing to compromise with price (s). You are going to see more sapphires in all color ranges and qualities.
Monday, December 18, 2006
Africa's Economy
Economist Intelligence Unit writes:
It should do well next year, if commodity prices stay high
The African economy is set for a fourth consecutive year of above-average growth, according to the World Bank's 2007 Global Economic Prospects, released on December 13th. Sub-Saharan GDP is forecast to increase by 5.3% in 2007—maintaining the average recorded over the 2004-06 period—and when South Africa (the region’s largest economy by far) is excluded, average growth rates are even more impressive, at 5.6% a year since 2003.
In 2006, oil exporters led the way with average growth of 6.9%, while (small) oil importers managed average expansion of 4.9%. Growth was broadly based, with one-third of the countries registering growth of more than 5%; indeed, only six states experienced declining incomes per head. This list includes two oil exporters, Gabon and Congo (Brazzaville), along with Eritrea, Swaziland, the Seychelles and Zimbabwe.
The World Bank attributes Africa’s “robust” economic expansion to favourable international conditions, improved economic policies in Africa itself, accelerated regional exports (to China especially), and higher commodity prices, most notably for oil and metals. Unfortunately, manufactured exports were hit by “intense competition from China and India”, and although both the US and the EU re-introduced quotas on Chinese clothing and textile exports to their markets, Sub-Saharan Africa’s clothing and textile exports to the US fell 17.3% while those to the EU were down 16.9%.
Going forward, growth in oil-exporting countries is projected to accelerate in line with increasing capacity in Angola (where output is expected to rise 20%) and Equatorial Guinea (up 8%), along with the normalisation of output levels in Nigeria, where production has been disrupted by civil strife in the Niger Delta. Average growth in oil producers is projected at 7.5% in 2007 and more than 7% in 2008, but depletion of existing oilfields will reduce GDP growth in Congo (Brazzaville) by one percentage point.
In the regional economic powerhouse, South Africa, growth will slow to less than 4% as higher interest rates affect domestic demand while inflation and rand depreciation accelerate. However, the World Bank does not anticipate serious problems in the country because rand depreciation should boost exports, notably in mining and manufacturing, while public-sector infrastructural investment will rise in the run-up to the 2010 World Cup.
The Bank expects growth in oil-importing countries to remain strong in 2007, at around 4.9%, due to improved rainfall in East and West Africa, and higher levels of investment and government spending as a result of debt relief and increased aid inflows; over the medium term, meanwhile, infrastructural investment should reduce the costs of doing business in Africa.
On the downside, lower world commodity prices will damp down growth while farm production will be hit by high fertiliser prices. Equally, while increased Chinese demand for cotton and reduced price subsidies in the US and EU should benefit cotton producers in West Africa, African manufacturers of clothing and textiles will most likely continue to lose market share to China and India.
Inflationary pressures are expected to subside as oil and other commodity prices weaken, but in South Africa inflation is expected to nudge above 6% in the first half of 2007 before slowing in the latter part of the year. Inflation is projected to slow to 4.6% in 2007 from 5.8% in 2006, before picking up slightly to 5% in 2008.
Despite lower oil prices in 2007-08 strong GDP growth and lower non-oil commodity prices will mean a further deterioration in the region’s current-account balance, which will deteriorate from surpluses of 0.8% of GDP in 2005 and 0.3% this year to a marginal deficit of 0.2% in 2007 and 0.9% in 2008.
Because Africa is so reliant on commodity exports, it is the region most vulnerable to any decline in energy and mineral prices. Overall agricultural prices are projected to fall marginally (by 1%) in 2007 and 3% in 2008. However, if oil prices remain high some agricultural prices are likely to rise, because higher oil prices increase the economic viability of biofuel, thereby generating additional demand for products like sugar and maize. The World Bank believes that metal prices have peaked and will decline in 2007-08, while oil prices are expected to slip to around US$53/barrel by 2008 (although they will remain highly volatile).
The African countries that are most vulnerable to a commodity price shakeout are oil and mineral exporters. But because the envisaged commodity price slowdown is only modest the overall impact on African growth is unlikely to be much more than 0.5%, reducing regional growth to 4.75% in 2007; in addition, countries that do not rely on oil/metal exports or are oil importers will actually be better off. In other words, unless there is an unexpectedly sharp fall in commodity prices 2007 looks set to be another good year for Sub-Saharan economies.
More info @ http://www.economist.com/daily/news/displaystory.cfm?story_id=8436140
It should do well next year, if commodity prices stay high
The African economy is set for a fourth consecutive year of above-average growth, according to the World Bank's 2007 Global Economic Prospects, released on December 13th. Sub-Saharan GDP is forecast to increase by 5.3% in 2007—maintaining the average recorded over the 2004-06 period—and when South Africa (the region’s largest economy by far) is excluded, average growth rates are even more impressive, at 5.6% a year since 2003.
In 2006, oil exporters led the way with average growth of 6.9%, while (small) oil importers managed average expansion of 4.9%. Growth was broadly based, with one-third of the countries registering growth of more than 5%; indeed, only six states experienced declining incomes per head. This list includes two oil exporters, Gabon and Congo (Brazzaville), along with Eritrea, Swaziland, the Seychelles and Zimbabwe.
The World Bank attributes Africa’s “robust” economic expansion to favourable international conditions, improved economic policies in Africa itself, accelerated regional exports (to China especially), and higher commodity prices, most notably for oil and metals. Unfortunately, manufactured exports were hit by “intense competition from China and India”, and although both the US and the EU re-introduced quotas on Chinese clothing and textile exports to their markets, Sub-Saharan Africa’s clothing and textile exports to the US fell 17.3% while those to the EU were down 16.9%.
Going forward, growth in oil-exporting countries is projected to accelerate in line with increasing capacity in Angola (where output is expected to rise 20%) and Equatorial Guinea (up 8%), along with the normalisation of output levels in Nigeria, where production has been disrupted by civil strife in the Niger Delta. Average growth in oil producers is projected at 7.5% in 2007 and more than 7% in 2008, but depletion of existing oilfields will reduce GDP growth in Congo (Brazzaville) by one percentage point.
In the regional economic powerhouse, South Africa, growth will slow to less than 4% as higher interest rates affect domestic demand while inflation and rand depreciation accelerate. However, the World Bank does not anticipate serious problems in the country because rand depreciation should boost exports, notably in mining and manufacturing, while public-sector infrastructural investment will rise in the run-up to the 2010 World Cup.
The Bank expects growth in oil-importing countries to remain strong in 2007, at around 4.9%, due to improved rainfall in East and West Africa, and higher levels of investment and government spending as a result of debt relief and increased aid inflows; over the medium term, meanwhile, infrastructural investment should reduce the costs of doing business in Africa.
On the downside, lower world commodity prices will damp down growth while farm production will be hit by high fertiliser prices. Equally, while increased Chinese demand for cotton and reduced price subsidies in the US and EU should benefit cotton producers in West Africa, African manufacturers of clothing and textiles will most likely continue to lose market share to China and India.
Inflationary pressures are expected to subside as oil and other commodity prices weaken, but in South Africa inflation is expected to nudge above 6% in the first half of 2007 before slowing in the latter part of the year. Inflation is projected to slow to 4.6% in 2007 from 5.8% in 2006, before picking up slightly to 5% in 2008.
Despite lower oil prices in 2007-08 strong GDP growth and lower non-oil commodity prices will mean a further deterioration in the region’s current-account balance, which will deteriorate from surpluses of 0.8% of GDP in 2005 and 0.3% this year to a marginal deficit of 0.2% in 2007 and 0.9% in 2008.
Because Africa is so reliant on commodity exports, it is the region most vulnerable to any decline in energy and mineral prices. Overall agricultural prices are projected to fall marginally (by 1%) in 2007 and 3% in 2008. However, if oil prices remain high some agricultural prices are likely to rise, because higher oil prices increase the economic viability of biofuel, thereby generating additional demand for products like sugar and maize. The World Bank believes that metal prices have peaked and will decline in 2007-08, while oil prices are expected to slip to around US$53/barrel by 2008 (although they will remain highly volatile).
The African countries that are most vulnerable to a commodity price shakeout are oil and mineral exporters. But because the envisaged commodity price slowdown is only modest the overall impact on African growth is unlikely to be much more than 0.5%, reducing regional growth to 4.75% in 2007; in addition, countries that do not rely on oil/metal exports or are oil importers will actually be better off. In other words, unless there is an unexpectedly sharp fall in commodity prices 2007 looks set to be another good year for Sub-Saharan economies.
More info @ http://www.economist.com/daily/news/displaystory.cfm?story_id=8436140
Person Of The Year: You
Lev Grossman (Times Magazine) writes:
Yes, you. You control the Information Age. Welcome to your world.
The "Great Man" theory of history is usually attributed to the Scottish philosopher Thomas Carlyle, who wrote that "the history of the world is but the biography of great men." He believed that it is the few, the powerful and the famous who shape our collective destiny as a species. That theory took a serious beating this year.
To be sure, there are individuals we could blame for the many painful and disturbing things that happened in 2006. The conflict in Iraq only got bloodier and more entrenched. A vicious skirmish erupted between Israel and Lebanon. A war dragged on in Sudan. A tin-pot dictator in North Korea got the Bomb, and the President of Iran wants to go nuclear too. Meanwhile nobody fixed global warming, and Sony didn't make enough PlayStation3s.
But look at 2006 through a different lens and you'll see another story, one that isn't about conflict or great men. It's a story about community and collaboration on a scale never seen before. It's about the cosmic compendium of knowledge Wikipedia and the million-channel people's network YouTube and the online metropolis MySpace. It's about the many wresting power from the few and helping one another for nothing and how that will not only change the world, but also change the way the world changes.
The tool that makes this possible is the World Wide Web. Not the Web that Tim Berners-Lee hacked together (15 years ago, according to Wikipedia) as a way for scientists to share research. It's not even the overhyped dotcom Web of the late 1990s. The new Web is a very different thing. It's a tool for bringing together the small contributions of millions of people and making them matter. Silicon Valley consultants call it Web 2.0, as if it were a new version of some old software. But it's really a revolution.
And we are so ready for it. We're ready to balance our diet of predigested news with raw feeds from Baghdad and Boston and Beijing. You can learn more about how Americans live just by looking at the backgrounds of YouTube videos—those rumpled bedrooms and toy-strewn basement rec rooms—than you could from 1,000 hours of network television.
And we didn't just watch, we also worked. Like crazy. We made Facebook profiles and Second Life avatars and reviewed books at Amazon and recorded podcasts. We blogged about our candidates losing and wrote songs about getting dumped. We camcordered bombing runs and built open-source software.
America loves its solitary geniuses—its Einsteins, its Edisons, its Jobses—but those lonely dreamers may have to learn to play with others. Car companies are running open design contests. Reuters is carrying blog postings alongside its regular news feed. Microsoft is working overtime to fend off user-created Linux. We're looking at an explosion of productivity and innovation, and it's just getting started, as millions of minds that would otherwise have drowned in obscurity get backhauled into the global intellectual economy.
Who are these people? Seriously, who actually sits down after a long day at work and says, I'm not going to watch Lost tonight. I'm going to turn on my computer and make a movie starring my pet iguana? I'm going to mash up 50 Cent's vocals with Queen's instrumentals? I'm going to blog about my state of mind or the state of the nation or the steak-frites at the new bistro down the street? Who has that time and that energy and that passion?
The answer is, you do. And for seizing the reins of the global media, for founding and framing the new digital democracy, for working for nothing and beating the pros at their own game, TIME's Person of the Year for 2006 is you.
Sure, it's a mistake to romanticize all this any more than is strictly necessary. Web 2.0 harnesses the stupidity of crowds as well as its wisdom. Some of the comments on YouTube make you weep for the future of humanity just for the spelling alone, never mind the obscenity and the naked hatred.
But that's what makes all this interesting. Web 2.0 is a massive social experiment, and like any experiment worth trying, it could fail. There's no road map for how an organism that's not a bacterium lives and works together on this planet in numbers in excess of 6 billion. But 2006 gave us some ideas. This is an opportunity to build a new kind of international understanding, not politician to politician, great man to great man, but citizen to citizen, person to person. It's a chance for people to look at a computer screen and really, genuinely wonder who's out there looking back at them. Go on. Tell us you're not just a little bit curious.
More info @ http://www.time.com/time/magazine/article/0,9171,1569514,00.html?aid=434&from=o&to=http%3A//www.time.com/time/magazine/article/0%2C9171%2C1569514%2C00.html
Yes, you. You control the Information Age. Welcome to your world.
The "Great Man" theory of history is usually attributed to the Scottish philosopher Thomas Carlyle, who wrote that "the history of the world is but the biography of great men." He believed that it is the few, the powerful and the famous who shape our collective destiny as a species. That theory took a serious beating this year.
To be sure, there are individuals we could blame for the many painful and disturbing things that happened in 2006. The conflict in Iraq only got bloodier and more entrenched. A vicious skirmish erupted between Israel and Lebanon. A war dragged on in Sudan. A tin-pot dictator in North Korea got the Bomb, and the President of Iran wants to go nuclear too. Meanwhile nobody fixed global warming, and Sony didn't make enough PlayStation3s.
But look at 2006 through a different lens and you'll see another story, one that isn't about conflict or great men. It's a story about community and collaboration on a scale never seen before. It's about the cosmic compendium of knowledge Wikipedia and the million-channel people's network YouTube and the online metropolis MySpace. It's about the many wresting power from the few and helping one another for nothing and how that will not only change the world, but also change the way the world changes.
The tool that makes this possible is the World Wide Web. Not the Web that Tim Berners-Lee hacked together (15 years ago, according to Wikipedia) as a way for scientists to share research. It's not even the overhyped dotcom Web of the late 1990s. The new Web is a very different thing. It's a tool for bringing together the small contributions of millions of people and making them matter. Silicon Valley consultants call it Web 2.0, as if it were a new version of some old software. But it's really a revolution.
And we are so ready for it. We're ready to balance our diet of predigested news with raw feeds from Baghdad and Boston and Beijing. You can learn more about how Americans live just by looking at the backgrounds of YouTube videos—those rumpled bedrooms and toy-strewn basement rec rooms—than you could from 1,000 hours of network television.
And we didn't just watch, we also worked. Like crazy. We made Facebook profiles and Second Life avatars and reviewed books at Amazon and recorded podcasts. We blogged about our candidates losing and wrote songs about getting dumped. We camcordered bombing runs and built open-source software.
America loves its solitary geniuses—its Einsteins, its Edisons, its Jobses—but those lonely dreamers may have to learn to play with others. Car companies are running open design contests. Reuters is carrying blog postings alongside its regular news feed. Microsoft is working overtime to fend off user-created Linux. We're looking at an explosion of productivity and innovation, and it's just getting started, as millions of minds that would otherwise have drowned in obscurity get backhauled into the global intellectual economy.
Who are these people? Seriously, who actually sits down after a long day at work and says, I'm not going to watch Lost tonight. I'm going to turn on my computer and make a movie starring my pet iguana? I'm going to mash up 50 Cent's vocals with Queen's instrumentals? I'm going to blog about my state of mind or the state of the nation or the steak-frites at the new bistro down the street? Who has that time and that energy and that passion?
The answer is, you do. And for seizing the reins of the global media, for founding and framing the new digital democracy, for working for nothing and beating the pros at their own game, TIME's Person of the Year for 2006 is you.
Sure, it's a mistake to romanticize all this any more than is strictly necessary. Web 2.0 harnesses the stupidity of crowds as well as its wisdom. Some of the comments on YouTube make you weep for the future of humanity just for the spelling alone, never mind the obscenity and the naked hatred.
But that's what makes all this interesting. Web 2.0 is a massive social experiment, and like any experiment worth trying, it could fail. There's no road map for how an organism that's not a bacterium lives and works together on this planet in numbers in excess of 6 billion. But 2006 gave us some ideas. This is an opportunity to build a new kind of international understanding, not politician to politician, great man to great man, but citizen to citizen, person to person. It's a chance for people to look at a computer screen and really, genuinely wonder who's out there looking back at them. Go on. Tell us you're not just a little bit curious.
More info @ http://www.time.com/time/magazine/article/0,9171,1569514,00.html?aid=434&from=o&to=http%3A//www.time.com/time/magazine/article/0%2C9171%2C1569514%2C00.html
Best Business Books: 2006
Strategy + Business writes:
This year’s best books can help identify patterns in the seemingly unpredictable.
1. The Future by Howard Rheingold
2. Economics by Michael Schrage
3. Marketing by Nick Wreden
4. Media by Nell Minow
5. Negotiation by Nikos Mourkogiannis
6. Strategy by Chuck Lucier and Jan Dyer
7. Governance by Michelle Leder
8. Management by David K. Hurst
9. The Business of Defense by Dov S. Zakheim
10. Fiction by Jonathan Weber
11. Leadership by James O’Toole
More info @ http://www.strategy-business.com/press/freearticle/06407
This year’s best books can help identify patterns in the seemingly unpredictable.
1. The Future by Howard Rheingold
2. Economics by Michael Schrage
3. Marketing by Nick Wreden
4. Media by Nell Minow
5. Negotiation by Nikos Mourkogiannis
6. Strategy by Chuck Lucier and Jan Dyer
7. Governance by Michelle Leder
8. Management by David K. Hurst
9. The Business of Defense by Dov S. Zakheim
10. Fiction by Jonathan Weber
11. Leadership by James O’Toole
More info @ http://www.strategy-business.com/press/freearticle/06407
Sunday, December 17, 2006
All That Glisters...
The Economist writes:
A lot of cities harbour the desire to become a financial centre. Nowhere, however, has been as bold as Dubai
THE sprawling gold souk in the old quarter of Deira is testament to Dubai's history as a staging post along ancient Middle Eastern trade routes. But today the stalls selling glittering bangles attract more tourists than traders. The serious money is pouring into the other, newer Dubai emerging from a forest of construction cranes in the desert a few miles to the south. There, amid some of the world's most luxurious hotels, apartments and shopping malls, the emirate's most audacious gamble is taking shape.
The Dubai International Financial Centre is a small city-within-a-city, clustered around a striking building known as “the Gate”. It is an attempt by the ruling al-Maktoum family and a close-knit web of their business partners to build a global centre for financial services. “Our goal is to put Dubai's clock up on the walls of the world's financial institutions, in a slot between Hong Kong, Singapore and London,” says Nasser Alshaali, a senior official with the centre's new financial exchange.
As capital is becoming more mobile, an unprecedented opportunity exists for cities to join the competition for international financial business. São Paulo, Shanghai, Kuala Lumpur, Johannesburg and Istanbul are all aspiring to become regional financial centres. To succeed, they must meet the needs of international bankers and financiers: transport links, sound regulatory and legal systems, technological sophistication, a good quality of life for expatriate bankers and liquid capital markets (often sustained by an emerging middle class).
Hong Kong and Singapore can already tick all of these boxes. Dubai means to do the same. But the emirate is in a hurry. Instead of building itself up bit by bit and slowly gaining the confidence of financiers—as London and New York did over decades—it is trying to buy its place at the table. Fifteen months after it opened and despite billions of dollars of investments, the results have been mixed and there is scepticism at just how successful it can be. But these are early days.
Dubai starts with considerable advantages. It sits in a region awash with money—thanks largely to surging oil revenues. Financiers reckon that up to $2 trillion in investments come from the Gulf region, the bulk of which is parked abroad, often as American treasury bills and in places like Switzerland and London. But increasingly, money is staying closer to home. According to a report by Capgemini and Merrill Lynch, the number of people in the Middle East with more than $1m in financial assets rose by nearly 10%, to 300,000, last year. The number of very rich is expected to jump to 1.8m by 2010. Governments in the region are also spending billions of dollars on infrastructure, and national investment agencies are on the prowl for things to put their cash into.
No wonder global financial firms are increasing the breadth and depth of their operations in the Middle East. A handful of big banks has been in the region for decades. HSBC, for instance, has operated in Dubai for 60 years. But in the past they were restricted to areas such as commercial banking. As rules have been loosened, more investment banks, insurers, fund managers, private-equity firms and even a few hedge funds have arrived.
Dubai wants them all. It is chasing business not only from the Middle East, but also from countries farther east, such as India. The financial centre is trying to attract corporate and investment banking, private banking, capital markets, asset management, fund administration, reinsurance, Islamic finance and back-office operations. Accordingly, the Dubai financial centre has been granted its own commercial laws, regulators and courts. It is an oasis within the more traditional bureaucratic and legal systems in force elsewhere in Dubai—not to mention the region as a whole.
The rulers' backing
The city is also setting up new markets. Although the Dubai International Financial Exchange is only 15 months old, Dubai will soon open a commodities exchange as well. This will work in partnership with the New York Mercantile Exchange, offering as its main product a new oil-futures contact based on Omani crude, which officials hope will become a new world benchmark. In a sign of Dubai's growing influence, the government of neighbouring Oman recently took a 30% stake in the commodities exchange.
Behind much of this lies a second advantage: the firm hand and deep pockets of Dubai's ruling family. Companies are lured to Dubai by incentives that, so far, are unmatched in the region.
“They have taken some of the best from Bermuda and Switzerland and are combining those concepts,” says Michael Klein, a senior executive with Citigroup. The deals on offer include zero tax on income and profits, 100% foreign ownership, no restrictions on foreign exchange or repatriation of profits, and relatively transparent light-touch regulation (with laws borrowed heavily from Britain and Australia). Even the regulators have been imported.
Thanks to these incentives, coupled with tireless marketing and Dubai's reputation as a relatively comfortable place to live and work, a trickle of interest has turned into a small stampede. The centre aims to become home to 250 international financial firms by 2009; so far, several dozen have set up shop. Two giants, Deutsche Bank and Credit Suisse, arrived early. Since then a gaggle of well-known firms, such as Goldman Sachs and Lehman Brothers, have moved in or plan to do so.
Morgan Stanley, which opened an office last spring, is the sort of firm that local officials love.
“Dubai has done it right,” says George Makhoul, a Lebanese-born manager who runs the investment bank's operations in the Middle East and North Africa. “They built it and then said come get it.” The firm more than doubled its regional revenues in its first six months, he says. Although its usual practice is to enter a new market one step at a time, starting with investment banking, Morgan Stanley offered its full array of wholesale financial services in Dubai from the outset. “You can't get in just by getting your toes wet,” adds Mr Makhoul. Given the demand, “our strategy was probably justified in the first week.”
Dubai's third advantage is a history of pulling off grand schemes. Blessed with fewer oil or gas deposits than its neighbours, the emirate has long sought other ways to make a living and has thrived as a trading entrepot living off its wits. “When I look at Dubai, I think of Amsterdam in the 16th century,” says Saskia Sassen, a sociologist at the University of Chicago, who studies global cities. “Dubai is not a six-month miracle.”
Dubai's big successes include the Jebel Ali container port; a world-class airport; a leading airline in Emirates; duty-free stores that would exhaust the most indefatigable shopper; the world's first seven-star hotel; luxury beach resorts; regional centres for media and health care; as well as more unusual projects, including man-made islands in fantastic shapes. The world's tallest building, the Burj Dubai, is also under construction. All this helps to attract celebrities, from Saudi princes to Russian plutocrats and professional footballers, who often buy homes. Although some find it all a bit tacky, Dubai has shown imagination, a knack for getting things done, and an ability to harness capital and use top international talent.
Not everyone is convinced that Dubai's financial designs will be so profitable.
“People are committing too many resources to the region,” says a private-equity manager associated with one of the Gulf's big investment firms. “If the whole world is coming to Dubai to do business, they're going to be disappointed,” adds a banker who sits on the financial exchange's board. “There's not enough business for 30 global financial institutions.”
Even Morgan Stanley's Mr Makhoul admits that, given the wide variety of firms the centre is courting, the time is approaching for Dubai to produce more results. “It seems there's an abundance of initiatives,” he says. “We'd like to see some of these things come to fruition.”
Below expectations
Whereas international banks report an increase in their institutional securities business (mergers and acquisitions, for instance), the volume of trading on the Dubai International Financial Exchange has been disappointing. Until the market becomes bigger and more liquid, successful public offerings will be hard to attract. And financiers complain that Dubai's rulers, despite many hopes, have not yet floated some of its successful state-owned ventures on the exchange. “If the exchange is so great, why is the Dubai government not using it?” asks a former regulator.
An international banker on the exchange's board agrees that the shortage of initial offerings is a problem. He suggests that the big banks will give the market another six to 12 months to get products trading with good liquidity before they reconsider their involvement. “The basic question people are asking is, ‘is this a place to raise money or not, a place to access capital in the region?'” he says. “People need to clearly think this is going in the right direction.”
Predictably, Mr Alshaali, the local official, defends the government. “We don't expect to force a listing of one of its assets,” he says. But he acknowledges that volatile conditions in the region's stockmarkets this year—some indices have plunged by as much as 60%—have made the timing of public listings awkward.
Mr Alshaali points out that both issuers and investors are more careful nowadays. The cautious mood extends throughout the region, where even taxi drivers poured their cash into fledgling stockmarkets only to see their money evaporate. It came as a shock to first-time investors, says Nasser Saidi, a Lebanese-born economist working at the Dubai financial centre: “Everyone thought the only way was up.” Niall Booker, head of HSBC's banking operations in the Middle East, notes that boom-and-bust cycles are typical of emerging markets. Now, he says, valuations have become more realistic.
The test of Dubai's financial sticking power will be its ability to bring together those who offer capital and those who need it. There are growing indications that Middle Eastern companies want to tap public markets to expand abroad, for instance, and Dubai's successful offering of the world's biggest sukuk—in effect, an Islamic bond—earlier this year raised hopes.
Much rests on the independence and legitimacy of Dubai's regulators. An early problem was the resignation of some well-known expatriates brought in to oversee the centre and its exchange. They claimed that local officials were improperly meddling, although the locals insist it was all a “cultural misunderstanding”. Indeed, there has been something of a revolving door for foreign executives. The latest arrival is a former head of OMX, the operator of a successful Scandinavian financial exchange, who took over running the financial exchange earlier this year.
One of the biggest difficulties in the Gulf is its notoriously opaque business culture. “We don't want to do business in hotel lobbies,” says Morgan Stanley's Mr Makhoul. “We're trying to bring a global standard to the market, not just do deals.” Yet a recent report from Hawkamah, a corporate-governance institute headed by Mr Saidi, concluded that regional business practices fall well behind Western standards of transparency and accounting. This may not be so surprising considering that about 85% of firms in the region are family-owned.
Putting down cash
If Dubai is to succeed in its ambition, other practices must also change. The emirate has a long-standing reputation for smuggling and money-laundering—the terrorists who struck on September 11th 2001 transferred some of their funds through Dubai. The financial centre has worked hard to show Western governments that it has cracked down, but elsewhere in Dubai it is not uncommon to hear stories about pricey luxury apartments paid for in cash by rich Russians who rarely visit.
Because the financial centre was created from scratch with a commitment to transparency and international standards, its officials say such worries are unfounded. Yet, in private, Western financial executives operating in Dubai remain on guard about accepting potentially dirty funds. “There is money here from questionable sources, which is very tempting,” says one executive whose firm recently opened in the centre. “We haven't turned down money yet, but I expect it will happen. We have to know our investors.”
The questions of image and security go wider. Expatriate circles gossip about how the ruling family tries to protect the emirate from threats like that of al-Qaeda. One line of defence is an elaborate intelligence network. Another is strict immigration controls. Migrant labour is a sensitive issue. “The entire economy is run on the backs of migrant workers,” claims Hadi Ghaemi of Human Rights Watch. More than 80% of workers in the United Arab Emirates' private sector are migrants. Despite a series of protests against low pay and poor working conditions, the government has taken little action. Trade unions and strikes are banned. Human Rights Watch found that 34 site-related deaths of construction workers were reported to the Dubai government in 2004, but Mr Ghaemi says it counted 880 dead bodies sent home by foreign embassies the same year. “They can't explain the deaths,” he adds.
As in other city states with firm controls, Dubai also keeps a grip on the media. Journalists exercise self-censorship, steering clear of stories critical of the ruling family or anything that might damage the economy. Even Skype, the free internet-phone service, is banned in order to protect the local telecoms provider. It remains to be seen whether such restrictions will continue as the UAE inches toward democracy—it will hold limited elections for the legislature in the coming week.
So far, the flush of new wealth and relatively good quality of life have trumped such issues in the minds of foreign investors. Expatriates worry aloud more about spiralling inflation and grinding traffic jams. If inflation continues unabated, the UAE “faces the danger of pricing itself out of the low end of the processing market in banking and insurance,” says Mr Booker.
There is a recognition that if tiny Dubai can succeed as a money giant, it will be tied closely to its role as a gateway to the Gulf, much as Hong Kong is a gateway to China. Yet it is not the first place to dream of becoming a Middle Eastern financial hub. Beirut filled that role until war wrecked its economy in the 1980s and investors shifted toward the Gulf. Bahrain, Qatar and Kuwait have all since found their niches. Abu Dhabi, a rival next door with its own financial ambitions is now trying to become a place for the arts. It has signed a deal to build the world's biggest Guggenheim museum and is in talks to build an offshoot of the Louvre as well.
One obstacle for other countries in the region is the life they offer foreigners. Many are seen as relatively strict and dull places to live. But Dubai is not. “We're living in an Islamic ocean and we're a tiny common-law island,” says Sandy Shipton, an expatriate executive at the Dubai financial centre.
One country with a particular bearing in Dubai is Saudi Arabia. So far, its conservative culture and restrictive religious practices have led many international firms to try to serve the country from regional offices in Dubai; other executives who work there park their families in Dubai and fly back at weekends. But the Saudis are becoming more demanding: they now require a business licence and a Saudi office for foreign firms doing business in their country. Work has also started on a new commercial hub called King Abdullah City, near Jeddah, that will target global firms.
Despite all the jockeying for the attention of international financiers, some see the emergence of several financial hubs in the Middle East as a healthy sign. Indeed, one possibility is the growth of various centres of excellence. “The new reality is you can have a very capable network,” says Ms Sassen. “It's not simply a winner-take-all situation.” She cites Singapore's ties with the Chinese city of Shenzhen as an example of regional collaboration.
Executives at the Dubai financial centre see the parallels with Asia and increasingly promote it as a complement to places like Singapore, rather than a competitor for them. The Omani oil-futures contract, for instance, was chosen as a benchmark for the new Dubai commodities exchange in part because the contract is used by oil traders in Singapore.
Dubai has spent a fortune and done virtually everything within its power to establish an attractive market. In the end, though, successful financial centres cannot be created by government fiat. Success now depends on forces that are largely beyond its control.
More info @ http://www.economist.com/finance/displaystory.cfm?story_id=8422344
A lot of cities harbour the desire to become a financial centre. Nowhere, however, has been as bold as Dubai
THE sprawling gold souk in the old quarter of Deira is testament to Dubai's history as a staging post along ancient Middle Eastern trade routes. But today the stalls selling glittering bangles attract more tourists than traders. The serious money is pouring into the other, newer Dubai emerging from a forest of construction cranes in the desert a few miles to the south. There, amid some of the world's most luxurious hotels, apartments and shopping malls, the emirate's most audacious gamble is taking shape.
The Dubai International Financial Centre is a small city-within-a-city, clustered around a striking building known as “the Gate”. It is an attempt by the ruling al-Maktoum family and a close-knit web of their business partners to build a global centre for financial services. “Our goal is to put Dubai's clock up on the walls of the world's financial institutions, in a slot between Hong Kong, Singapore and London,” says Nasser Alshaali, a senior official with the centre's new financial exchange.
As capital is becoming more mobile, an unprecedented opportunity exists for cities to join the competition for international financial business. São Paulo, Shanghai, Kuala Lumpur, Johannesburg and Istanbul are all aspiring to become regional financial centres. To succeed, they must meet the needs of international bankers and financiers: transport links, sound regulatory and legal systems, technological sophistication, a good quality of life for expatriate bankers and liquid capital markets (often sustained by an emerging middle class).
Hong Kong and Singapore can already tick all of these boxes. Dubai means to do the same. But the emirate is in a hurry. Instead of building itself up bit by bit and slowly gaining the confidence of financiers—as London and New York did over decades—it is trying to buy its place at the table. Fifteen months after it opened and despite billions of dollars of investments, the results have been mixed and there is scepticism at just how successful it can be. But these are early days.
Dubai starts with considerable advantages. It sits in a region awash with money—thanks largely to surging oil revenues. Financiers reckon that up to $2 trillion in investments come from the Gulf region, the bulk of which is parked abroad, often as American treasury bills and in places like Switzerland and London. But increasingly, money is staying closer to home. According to a report by Capgemini and Merrill Lynch, the number of people in the Middle East with more than $1m in financial assets rose by nearly 10%, to 300,000, last year. The number of very rich is expected to jump to 1.8m by 2010. Governments in the region are also spending billions of dollars on infrastructure, and national investment agencies are on the prowl for things to put their cash into.
No wonder global financial firms are increasing the breadth and depth of their operations in the Middle East. A handful of big banks has been in the region for decades. HSBC, for instance, has operated in Dubai for 60 years. But in the past they were restricted to areas such as commercial banking. As rules have been loosened, more investment banks, insurers, fund managers, private-equity firms and even a few hedge funds have arrived.
Dubai wants them all. It is chasing business not only from the Middle East, but also from countries farther east, such as India. The financial centre is trying to attract corporate and investment banking, private banking, capital markets, asset management, fund administration, reinsurance, Islamic finance and back-office operations. Accordingly, the Dubai financial centre has been granted its own commercial laws, regulators and courts. It is an oasis within the more traditional bureaucratic and legal systems in force elsewhere in Dubai—not to mention the region as a whole.
The rulers' backing
The city is also setting up new markets. Although the Dubai International Financial Exchange is only 15 months old, Dubai will soon open a commodities exchange as well. This will work in partnership with the New York Mercantile Exchange, offering as its main product a new oil-futures contact based on Omani crude, which officials hope will become a new world benchmark. In a sign of Dubai's growing influence, the government of neighbouring Oman recently took a 30% stake in the commodities exchange.
Behind much of this lies a second advantage: the firm hand and deep pockets of Dubai's ruling family. Companies are lured to Dubai by incentives that, so far, are unmatched in the region.
“They have taken some of the best from Bermuda and Switzerland and are combining those concepts,” says Michael Klein, a senior executive with Citigroup. The deals on offer include zero tax on income and profits, 100% foreign ownership, no restrictions on foreign exchange or repatriation of profits, and relatively transparent light-touch regulation (with laws borrowed heavily from Britain and Australia). Even the regulators have been imported.
Thanks to these incentives, coupled with tireless marketing and Dubai's reputation as a relatively comfortable place to live and work, a trickle of interest has turned into a small stampede. The centre aims to become home to 250 international financial firms by 2009; so far, several dozen have set up shop. Two giants, Deutsche Bank and Credit Suisse, arrived early. Since then a gaggle of well-known firms, such as Goldman Sachs and Lehman Brothers, have moved in or plan to do so.
Morgan Stanley, which opened an office last spring, is the sort of firm that local officials love.
“Dubai has done it right,” says George Makhoul, a Lebanese-born manager who runs the investment bank's operations in the Middle East and North Africa. “They built it and then said come get it.” The firm more than doubled its regional revenues in its first six months, he says. Although its usual practice is to enter a new market one step at a time, starting with investment banking, Morgan Stanley offered its full array of wholesale financial services in Dubai from the outset. “You can't get in just by getting your toes wet,” adds Mr Makhoul. Given the demand, “our strategy was probably justified in the first week.”
Dubai's third advantage is a history of pulling off grand schemes. Blessed with fewer oil or gas deposits than its neighbours, the emirate has long sought other ways to make a living and has thrived as a trading entrepot living off its wits. “When I look at Dubai, I think of Amsterdam in the 16th century,” says Saskia Sassen, a sociologist at the University of Chicago, who studies global cities. “Dubai is not a six-month miracle.”
Dubai's big successes include the Jebel Ali container port; a world-class airport; a leading airline in Emirates; duty-free stores that would exhaust the most indefatigable shopper; the world's first seven-star hotel; luxury beach resorts; regional centres for media and health care; as well as more unusual projects, including man-made islands in fantastic shapes. The world's tallest building, the Burj Dubai, is also under construction. All this helps to attract celebrities, from Saudi princes to Russian plutocrats and professional footballers, who often buy homes. Although some find it all a bit tacky, Dubai has shown imagination, a knack for getting things done, and an ability to harness capital and use top international talent.
Not everyone is convinced that Dubai's financial designs will be so profitable.
“People are committing too many resources to the region,” says a private-equity manager associated with one of the Gulf's big investment firms. “If the whole world is coming to Dubai to do business, they're going to be disappointed,” adds a banker who sits on the financial exchange's board. “There's not enough business for 30 global financial institutions.”
Even Morgan Stanley's Mr Makhoul admits that, given the wide variety of firms the centre is courting, the time is approaching for Dubai to produce more results. “It seems there's an abundance of initiatives,” he says. “We'd like to see some of these things come to fruition.”
Below expectations
Whereas international banks report an increase in their institutional securities business (mergers and acquisitions, for instance), the volume of trading on the Dubai International Financial Exchange has been disappointing. Until the market becomes bigger and more liquid, successful public offerings will be hard to attract. And financiers complain that Dubai's rulers, despite many hopes, have not yet floated some of its successful state-owned ventures on the exchange. “If the exchange is so great, why is the Dubai government not using it?” asks a former regulator.
An international banker on the exchange's board agrees that the shortage of initial offerings is a problem. He suggests that the big banks will give the market another six to 12 months to get products trading with good liquidity before they reconsider their involvement. “The basic question people are asking is, ‘is this a place to raise money or not, a place to access capital in the region?'” he says. “People need to clearly think this is going in the right direction.”
Predictably, Mr Alshaali, the local official, defends the government. “We don't expect to force a listing of one of its assets,” he says. But he acknowledges that volatile conditions in the region's stockmarkets this year—some indices have plunged by as much as 60%—have made the timing of public listings awkward.
Mr Alshaali points out that both issuers and investors are more careful nowadays. The cautious mood extends throughout the region, where even taxi drivers poured their cash into fledgling stockmarkets only to see their money evaporate. It came as a shock to first-time investors, says Nasser Saidi, a Lebanese-born economist working at the Dubai financial centre: “Everyone thought the only way was up.” Niall Booker, head of HSBC's banking operations in the Middle East, notes that boom-and-bust cycles are typical of emerging markets. Now, he says, valuations have become more realistic.
The test of Dubai's financial sticking power will be its ability to bring together those who offer capital and those who need it. There are growing indications that Middle Eastern companies want to tap public markets to expand abroad, for instance, and Dubai's successful offering of the world's biggest sukuk—in effect, an Islamic bond—earlier this year raised hopes.
Much rests on the independence and legitimacy of Dubai's regulators. An early problem was the resignation of some well-known expatriates brought in to oversee the centre and its exchange. They claimed that local officials were improperly meddling, although the locals insist it was all a “cultural misunderstanding”. Indeed, there has been something of a revolving door for foreign executives. The latest arrival is a former head of OMX, the operator of a successful Scandinavian financial exchange, who took over running the financial exchange earlier this year.
One of the biggest difficulties in the Gulf is its notoriously opaque business culture. “We don't want to do business in hotel lobbies,” says Morgan Stanley's Mr Makhoul. “We're trying to bring a global standard to the market, not just do deals.” Yet a recent report from Hawkamah, a corporate-governance institute headed by Mr Saidi, concluded that regional business practices fall well behind Western standards of transparency and accounting. This may not be so surprising considering that about 85% of firms in the region are family-owned.
Putting down cash
If Dubai is to succeed in its ambition, other practices must also change. The emirate has a long-standing reputation for smuggling and money-laundering—the terrorists who struck on September 11th 2001 transferred some of their funds through Dubai. The financial centre has worked hard to show Western governments that it has cracked down, but elsewhere in Dubai it is not uncommon to hear stories about pricey luxury apartments paid for in cash by rich Russians who rarely visit.
Because the financial centre was created from scratch with a commitment to transparency and international standards, its officials say such worries are unfounded. Yet, in private, Western financial executives operating in Dubai remain on guard about accepting potentially dirty funds. “There is money here from questionable sources, which is very tempting,” says one executive whose firm recently opened in the centre. “We haven't turned down money yet, but I expect it will happen. We have to know our investors.”
The questions of image and security go wider. Expatriate circles gossip about how the ruling family tries to protect the emirate from threats like that of al-Qaeda. One line of defence is an elaborate intelligence network. Another is strict immigration controls. Migrant labour is a sensitive issue. “The entire economy is run on the backs of migrant workers,” claims Hadi Ghaemi of Human Rights Watch. More than 80% of workers in the United Arab Emirates' private sector are migrants. Despite a series of protests against low pay and poor working conditions, the government has taken little action. Trade unions and strikes are banned. Human Rights Watch found that 34 site-related deaths of construction workers were reported to the Dubai government in 2004, but Mr Ghaemi says it counted 880 dead bodies sent home by foreign embassies the same year. “They can't explain the deaths,” he adds.
As in other city states with firm controls, Dubai also keeps a grip on the media. Journalists exercise self-censorship, steering clear of stories critical of the ruling family or anything that might damage the economy. Even Skype, the free internet-phone service, is banned in order to protect the local telecoms provider. It remains to be seen whether such restrictions will continue as the UAE inches toward democracy—it will hold limited elections for the legislature in the coming week.
So far, the flush of new wealth and relatively good quality of life have trumped such issues in the minds of foreign investors. Expatriates worry aloud more about spiralling inflation and grinding traffic jams. If inflation continues unabated, the UAE “faces the danger of pricing itself out of the low end of the processing market in banking and insurance,” says Mr Booker.
There is a recognition that if tiny Dubai can succeed as a money giant, it will be tied closely to its role as a gateway to the Gulf, much as Hong Kong is a gateway to China. Yet it is not the first place to dream of becoming a Middle Eastern financial hub. Beirut filled that role until war wrecked its economy in the 1980s and investors shifted toward the Gulf. Bahrain, Qatar and Kuwait have all since found their niches. Abu Dhabi, a rival next door with its own financial ambitions is now trying to become a place for the arts. It has signed a deal to build the world's biggest Guggenheim museum and is in talks to build an offshoot of the Louvre as well.
One obstacle for other countries in the region is the life they offer foreigners. Many are seen as relatively strict and dull places to live. But Dubai is not. “We're living in an Islamic ocean and we're a tiny common-law island,” says Sandy Shipton, an expatriate executive at the Dubai financial centre.
One country with a particular bearing in Dubai is Saudi Arabia. So far, its conservative culture and restrictive religious practices have led many international firms to try to serve the country from regional offices in Dubai; other executives who work there park their families in Dubai and fly back at weekends. But the Saudis are becoming more demanding: they now require a business licence and a Saudi office for foreign firms doing business in their country. Work has also started on a new commercial hub called King Abdullah City, near Jeddah, that will target global firms.
Despite all the jockeying for the attention of international financiers, some see the emergence of several financial hubs in the Middle East as a healthy sign. Indeed, one possibility is the growth of various centres of excellence. “The new reality is you can have a very capable network,” says Ms Sassen. “It's not simply a winner-take-all situation.” She cites Singapore's ties with the Chinese city of Shenzhen as an example of regional collaboration.
Executives at the Dubai financial centre see the parallels with Asia and increasingly promote it as a complement to places like Singapore, rather than a competitor for them. The Omani oil-futures contract, for instance, was chosen as a benchmark for the new Dubai commodities exchange in part because the contract is used by oil traders in Singapore.
Dubai has spent a fortune and done virtually everything within its power to establish an attractive market. In the end, though, successful financial centres cannot be created by government fiat. Success now depends on forces that are largely beyond its control.
More info @ http://www.economist.com/finance/displaystory.cfm?story_id=8422344
Waikiki Gem Museum
Pacific Business News (Honolulu) writes:
A large collection of precious gems collected in Afghanistan will go on display to the public Tuesday at a Waikiki gem museum.
The collection of 60,000 gems valued from $2 to $100,000 is the work of gem collector Gary Bowersox, owner of The Gem Museum/Store at the Waikiki Galleria Office Towers.
The museum has been open by appointment only. Construction will be completed on the store in the next couple of months, Bowersox said. "Once completed visitors will come into a bullet-proof entranceway and enter a theater where different gem hunters from various countries will give lectures and talks on their experiences, knowledge and adventures," he said.
Next week, Mir Waees Khan Jegdalek, a ruby miner from the Jegdalek, Afghanistan, ruby mines, will lecture on Afghanistan and its gems. In addition to Bowersox, future lecture programs will feature Karla Brom Proud of Oregon, Guy Clutterback of Zambia, Sabir Rasool of Pakistan, Ilhom Narzier of Tajikistan and Ron Ringsrud of Colombia.
More info @ http://www.bizjournals.com/pacific/stories/2006/08/28/daily67.html?from_rss=1
A large collection of precious gems collected in Afghanistan will go on display to the public Tuesday at a Waikiki gem museum.
The collection of 60,000 gems valued from $2 to $100,000 is the work of gem collector Gary Bowersox, owner of The Gem Museum/Store at the Waikiki Galleria Office Towers.
The museum has been open by appointment only. Construction will be completed on the store in the next couple of months, Bowersox said. "Once completed visitors will come into a bullet-proof entranceway and enter a theater where different gem hunters from various countries will give lectures and talks on their experiences, knowledge and adventures," he said.
Next week, Mir Waees Khan Jegdalek, a ruby miner from the Jegdalek, Afghanistan, ruby mines, will lecture on Afghanistan and its gems. In addition to Bowersox, future lecture programs will feature Karla Brom Proud of Oregon, Guy Clutterback of Zambia, Sabir Rasool of Pakistan, Ilhom Narzier of Tajikistan and Ron Ringsrud of Colombia.
More info @ http://www.bizjournals.com/pacific/stories/2006/08/28/daily67.html?from_rss=1
India: No.1 Country Of Shopkeepers
Subodh Varma (Times News Network) writes:
You can now tell why the retail boom is about to happen in India. With about 11 retail shops for every 1,000 persons, India has the highest shop density in the world. That's one shop for every 20-25 families. In cities, the density is much higher. Delhi, for example, has nearly 45 shops per thousand persons! Americans, arguably the biggest spenders in the world, have to make do with just about 4 shops per 1,000 persons.
Singapore, the shoppers' paradise, has a similar density. England (rather, UK), once scathingly referred to as the nation of shopkeepers by Napoleon, is only marginally better — it has nearly 5 shops for every 1,000 persons.
According to a study by industry body Ficci, the total retail trade in India was worth Rs 11,00,000 crore in 2003. Of the approximately 12 million retail shops, 96% occupy floor space of less than 500 sq ft. And this is where comparisons with retail powers, like US or Singapore, end. In India, shops are many but they're small. Entry of big retail would consolidate the sector into fewer but bigger shops. The high number of shops in India is because most of them are in the unorganised sector — your local paanwallah, kirana store, subziwallah and so on.
More info @ http://economictimes.indiatimes.com/articleshow/816179.cms
You can now tell why the retail boom is about to happen in India. With about 11 retail shops for every 1,000 persons, India has the highest shop density in the world. That's one shop for every 20-25 families. In cities, the density is much higher. Delhi, for example, has nearly 45 shops per thousand persons! Americans, arguably the biggest spenders in the world, have to make do with just about 4 shops per 1,000 persons.
Singapore, the shoppers' paradise, has a similar density. England (rather, UK), once scathingly referred to as the nation of shopkeepers by Napoleon, is only marginally better — it has nearly 5 shops for every 1,000 persons.
According to a study by industry body Ficci, the total retail trade in India was worth Rs 11,00,000 crore in 2003. Of the approximately 12 million retail shops, 96% occupy floor space of less than 500 sq ft. And this is where comparisons with retail powers, like US or Singapore, end. In India, shops are many but they're small. Entry of big retail would consolidate the sector into fewer but bigger shops. The high number of shops in India is because most of them are in the unorganised sector — your local paanwallah, kirana store, subziwallah and so on.
More info @ http://economictimes.indiatimes.com/articleshow/816179.cms
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