LATEST ECONOMIC BRIEFINGS
EMIRATES: DUBAI | 30.07.2010
Dubai’s capital markets appear to be in for significant change with plans unveiled to establish a second-tier stock exchange coming hot on the heels of Dubai Financial Market (DFM) – the government-administered domestic bourse – and the DIFC-based NASDAQ Dubai’s move to formally link their trading platforms. All of this is happening as speculation of a merger between the bourses of Dubai and Abu Dhabi mounts.
ALGERIE | 30.07.2010
Les efforts importants déployés par l’Algérie pour augmenter la production céréalière commencent à porter leurs fruits, dans la mesure où les récoltes record de l’année dernière et les rendements importants de 2010 aideront à réduire les coûts d’importation et à créer des emplois sûrs dans les zones rurales. Cependant, l’objectif de l’autonomie alimentaire fixé par le pays reste encore bien éloigné.
SENEGAL | 30.07.2010
Le Sénégal est en train de devenir un leader en matière de développement de l’énergie solaire comme énergie de l’avenir, et ce, à la fois à l’échelle nationale et continentale. Pour y parvenir, le pays veut augmenter l’utilisation des énergies renouvelables afin de surmonter ses propres manques et promouvoir un grand programme international ayant pour but de mettre fin à la dépendance de l’Afrique de l’Ouest à l’égard des combustibles fossiles.
BULGARIA | 30.07.2010
Though Bulgaria’s economy is likely to remain in the slow lane for the rest of this year, the country’s banking sector continues to show resilience in the face of global economic contraction. There are concerns, however, that increasing levels of bad loans carried by some lenders could add to pressures on the sector.
OMAN | 28.07.2010
A raft of new agreements recently signed by the Ministry of Transport and Communications will see a significant round of investment in Oman’s transport infrastructure. The 15 agreements, signed earlier in July, cover projects in land, sea and air infrastructure and are worth a total of OR136.9m ($355.9m).
COUNTRY COVERAGE
Eyes on the Prize
Bahrain, Volume 36
25.02.2005
25.02.2005
A high-profile discussion forum this week in Gudaibiya saw government leaders and key business players all call for some bold new reforms in the Bahraini economy. The general consensus was that a glittering prize lay just ahead - if the right changes could be made in time. Yet in many respects, as a recent UN report revealed, Bahrain is already a regional leader, particularly when it comes to the new economy.
The UN Towards Access for Opportunity Report 2004, released this week, ranked the kingdom second only to Israel in the western Asian world and first among Arab countries in e government readiness. Ahead of both Cyprus and Turkey, Bahrain's high score was welcomed by Central Informatics Organisation (CIO) acting president Sheikh Ahmed bin Ateyatulla Al Khalifa, who told the press February 24, "We are proud to stand first in the Arab world."
According to Sheikh Ahmed, the report gave Bahrain high points thanks to projects such as King Hamad's Future Schools Project and the Smart Card project, also initiated by the King.
"Other successful projects surveyed in Bahrain include the Government Data Network, which connects all government departments through a single network, and the e-voting project," Sheikh Ahmed added.
Yet for all the success with e government, this week also saw leading Bahraini lawmakers and business chiefs airing their views on just how progress could be achieved in other areas of the kingdom's economy.
At a major seminar on February 24, held by the Economic Development Board (EDB) under the patronage of its chairman, Crown Prince Sheikh Salman bin Hamad Al Khalifa, some 180 invitees discussed the country's future economic path.
Grabbing the headlines was a speech by McKinsey & Co Middle East's managing director, Kito De Boer.
He suggested that if economic reforms went ahead, the kingdom could see a BD10bn ($26.6bn) "prize" added to its GDP over the next 10 years. As with all such predictions, however, there was also a reverse side of the coin - a decade ahead of slippage and decline if the country did not act now.
"Bahrain's current [average] 5% GDP growth is a good performance by international standards," De Boer told the audience. "However, the country's economic performance must look to the long-term to ensure sustainability."
As evidence for a declining trend in performance - both within Bahrain and amongst the other Gulf Cooperation Council (GCC) states - De Boer compared GDP rates with the Netherlands, Mexico and Australia, countries he claimed had similar resources and characteristics.
In 1980 the GCC's GDP per head was $18,000 (BD6,804) compared to $16,000 (BD6,048) in the Netherlands, $13,000 (BD4,914) in Australia and $5,000 (BD1,890) in Mexico.
However, by 2004, the levels had changed to $12,000 (BD4,536) in the GCC - a decline of 30% - $24,000 (BD9,072) in the Netherlands, $22,000 (BD8,316) in Australia and $6,000 (BD2,268) in Mexico.
Whether or not the countries selected really stand too close a comparison, the figures for GDP per capita decline in the GCC are warning enough. While growth rates in Bahrain have remained good - 5.2% for 2002 and 6.8% for 2003 - these should still be higher, argued De Boer. A thoroughgoing programme of economic reform, he suggested, could add as much as three percentage points onto these GDP figures, netting around BD1bn ($2.65bn) extra per year.
The selection of the Netherlands, Australia and Mexico was also clarified when De Boer began to characterise their commitment to just such economic reforms. The three "all tax for future planning", he said and had taken their governments "out of the business of business", focusing on quality to make their governments more efficient.
"To achieve economic growth, Bahrain must steer away from being government led to market led. It must move away from the demand side to the supply side," De Boer added.
Classic liberal market policies, in other words. As Bahrain's oil revenues look set to decrease in the years ahead, there is perhaps a more pressing case for such reforms in the kingdom than in some other gulf states. Yet, as De Boer also pointed out, such a view of using oil revenues to minimise risk could be less productive than using them to maximise opportunities.
It was a point recognised Sheikh Salman too, who declared at the seminar that while "until recently we have been in the forefront of countries in this region in terms of development and growth... today's reality indicates otherwise."
The Crown Prince went on to say that this "should inspire us to be committed in facing all challenges for Bahrain to regain its former status and outstanding performance in all fields... Our economic aspirations should always remain big - and very big. Modest objectives should never be, from today, within our national options."
Pushing the envelope on market reform then seems to be set as the keynote for the months and years ahead. After all, the prize seems well worth fighting for.
The UN Towards Access for Opportunity Report 2004, released this week, ranked the kingdom second only to Israel in the western Asian world and first among Arab countries in e government readiness. Ahead of both Cyprus and Turkey, Bahrain's high score was welcomed by Central Informatics Organisation (CIO) acting president Sheikh Ahmed bin Ateyatulla Al Khalifa, who told the press February 24, "We are proud to stand first in the Arab world."
According to Sheikh Ahmed, the report gave Bahrain high points thanks to projects such as King Hamad's Future Schools Project and the Smart Card project, also initiated by the King.
"Other successful projects surveyed in Bahrain include the Government Data Network, which connects all government departments through a single network, and the e-voting project," Sheikh Ahmed added.
Yet for all the success with e government, this week also saw leading Bahraini lawmakers and business chiefs airing their views on just how progress could be achieved in other areas of the kingdom's economy.
At a major seminar on February 24, held by the Economic Development Board (EDB) under the patronage of its chairman, Crown Prince Sheikh Salman bin Hamad Al Khalifa, some 180 invitees discussed the country's future economic path.
Grabbing the headlines was a speech by McKinsey & Co Middle East's managing director, Kito De Boer.
He suggested that if economic reforms went ahead, the kingdom could see a BD10bn ($26.6bn) "prize" added to its GDP over the next 10 years. As with all such predictions, however, there was also a reverse side of the coin - a decade ahead of slippage and decline if the country did not act now.
"Bahrain's current [average] 5% GDP growth is a good performance by international standards," De Boer told the audience. "However, the country's economic performance must look to the long-term to ensure sustainability."
As evidence for a declining trend in performance - both within Bahrain and amongst the other Gulf Cooperation Council (GCC) states - De Boer compared GDP rates with the Netherlands, Mexico and Australia, countries he claimed had similar resources and characteristics.
In 1980 the GCC's GDP per head was $18,000 (BD6,804) compared to $16,000 (BD6,048) in the Netherlands, $13,000 (BD4,914) in Australia and $5,000 (BD1,890) in Mexico.
However, by 2004, the levels had changed to $12,000 (BD4,536) in the GCC - a decline of 30% - $24,000 (BD9,072) in the Netherlands, $22,000 (BD8,316) in Australia and $6,000 (BD2,268) in Mexico.
Whether or not the countries selected really stand too close a comparison, the figures for GDP per capita decline in the GCC are warning enough. While growth rates in Bahrain have remained good - 5.2% for 2002 and 6.8% for 2003 - these should still be higher, argued De Boer. A thoroughgoing programme of economic reform, he suggested, could add as much as three percentage points onto these GDP figures, netting around BD1bn ($2.65bn) extra per year.
The selection of the Netherlands, Australia and Mexico was also clarified when De Boer began to characterise their commitment to just such economic reforms. The three "all tax for future planning", he said and had taken their governments "out of the business of business", focusing on quality to make their governments more efficient.
"To achieve economic growth, Bahrain must steer away from being government led to market led. It must move away from the demand side to the supply side," De Boer added.
Classic liberal market policies, in other words. As Bahrain's oil revenues look set to decrease in the years ahead, there is perhaps a more pressing case for such reforms in the kingdom than in some other gulf states. Yet, as De Boer also pointed out, such a view of using oil revenues to minimise risk could be less productive than using them to maximise opportunities.
It was a point recognised Sheikh Salman too, who declared at the seminar that while "until recently we have been in the forefront of countries in this region in terms of development and growth... today's reality indicates otherwise."
The Crown Prince went on to say that this "should inspire us to be committed in facing all challenges for Bahrain to regain its former status and outstanding performance in all fields... Our economic aspirations should always remain big - and very big. Modest objectives should never be, from today, within our national options."
Pushing the envelope on market reform then seems to be set as the keynote for the months and years ahead. After all, the prize seems well worth fighting for.
