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
Caps and Props
Oman, Volume 158
11.03.2008
11.03.2008
Oman going flat out to try to curb rising inflation, is planning to implement a ceiling on rental increases, looking to limit price hikes on a basket of staple goods and boost agricultural production to ensure self-sufficiency.
Oman's inflation rate hit 8.29% at the end of December, a 16-year high, with the consumer price index being driven by rising food and rental costs. Increasing costs of food, beverages and tobacco accounted for nearly one third of Oman's consumer inflation, while rents rose by an estimated 11% last year.
On March 10, a member of a committee set up by the government to examine measures to ease the burden of climbing rental costs announced new legislation would shortly be introduced to cap annual rent increase at 7%, the same figure as that adopted in Dubai.
The major overhaul of rental laws would bolster the rights of tenants and set a minimum lease period of four years for residential properties and seven years for business premises, according to Khalil Bin Abdullah Al Khonji, the chairman of the Omani Chamber of Commerce and Industry (OCCI).
The government was also planning to provide land just outside Muscat to private developers for constructing affordable residential property as a means to increase housing stocks and bring down rental pressure brought on by supply shortages, Al Khonji said.
However, the sultanate's overheated construction sector is under pressure to complete the orders it already has on its books.
Oman's rental market has being hit by soaring prices for construction materials, with the cost of cement and steel having recently been increased by 20% and 11% respectively. With the price of pre-fabricated concrete also having gone up by 25% in the past month, driven by shortages of supply and higher demand, some construction projects have been delayed, further tightening the housing and office market.
The OCCI's Contractors' Association has called for the state to act to rein in price rises or face even longer delays in completing projects.
The association's chairman, Sheikh Ali Bin Abdullah Al Badi, also put part of the blame for skyrocketing prices and shortages on the government itself.
"If the government is not able to find alternatives and ensure sufficient supplies then why has it approved projects worth billions of rials?" Al Badi was reported as saying on March 10.
Though not directly affecting rents, Oman's continued pegging of its currency with the US dollar has been a force behind rising inflation, pushing up the costs of imports, in particular foodstuffs.
In his role as OCCI chairman, rather than as a member of the rent committee, Al Khonji called for Oman's food suppliers and distributors to cap prices on a number of staple food items.
"The idea is to cater to the needs of the lower middle class and those sections of society for whom the slightest price can cause a major dent in their budget," Al Khonji told local press on March 10.
The basic items included on the OCCI's list are rice, wheat flour, sugar, lentils, cooking oil, tea, milk powder, evaporated milk and ghee. The chamber has established a group to oversee the scheme and keep the prices of these goods down.
The government is already moving along similar lines, with a ministerial committee unveiling an action plan on March 6 outlining a series of proposals to curb price rises and overcome shortages of supply for some commodities.
Oman's minister of commerce and industry, Maqbool bin Ali Sultan, said the committee's recommendations included increasing quotas for local fishermen and lifting seasonal bans on the importing of some fish species and the catching of some varieties in local waters.
The committee also recommended boosting agricultural output by providing technical and financial assistance to primary producers, including establishing projects to increase cattle, sheep and poultry farming, he said. At the same time, imports of live cattle and goats from neighbouring countries should be allowed, as long as health standards were met, said Ali Sultan.
One other recommendation of the committee was that basic foodstuffs, mainly those also identified by the OCCI, be subject to price control and support, along with cement, and reinforcing bars for the construction industry.
Though subsidies will help keep prices down in the short term, they will prove a drain on the state's coffers, while there is only so much inflation the private sector will be prepared to soak up before passing it on to consumers. Past attempts to police a rent cap have not met with outstanding success either, with landlords often allegedly able to get around restrictions.
The committee's longer-term recommendations to boost food availability hold out promise for the future, but it is in the here and now that Omanis are being hit in the hip pocket. For that pain to ease, a number of stars must align, with the weakening of the US dollar needing to regain some of its lost strength or be decoupled from Oman's rial.
Oman's inflation rate hit 8.29% at the end of December, a 16-year high, with the consumer price index being driven by rising food and rental costs. Increasing costs of food, beverages and tobacco accounted for nearly one third of Oman's consumer inflation, while rents rose by an estimated 11% last year.
On March 10, a member of a committee set up by the government to examine measures to ease the burden of climbing rental costs announced new legislation would shortly be introduced to cap annual rent increase at 7%, the same figure as that adopted in Dubai.
The major overhaul of rental laws would bolster the rights of tenants and set a minimum lease period of four years for residential properties and seven years for business premises, according to Khalil Bin Abdullah Al Khonji, the chairman of the Omani Chamber of Commerce and Industry (OCCI).
The government was also planning to provide land just outside Muscat to private developers for constructing affordable residential property as a means to increase housing stocks and bring down rental pressure brought on by supply shortages, Al Khonji said.
However, the sultanate's overheated construction sector is under pressure to complete the orders it already has on its books.
Oman's rental market has being hit by soaring prices for construction materials, with the cost of cement and steel having recently been increased by 20% and 11% respectively. With the price of pre-fabricated concrete also having gone up by 25% in the past month, driven by shortages of supply and higher demand, some construction projects have been delayed, further tightening the housing and office market.
The OCCI's Contractors' Association has called for the state to act to rein in price rises or face even longer delays in completing projects.
The association's chairman, Sheikh Ali Bin Abdullah Al Badi, also put part of the blame for skyrocketing prices and shortages on the government itself.
"If the government is not able to find alternatives and ensure sufficient supplies then why has it approved projects worth billions of rials?" Al Badi was reported as saying on March 10.
Though not directly affecting rents, Oman's continued pegging of its currency with the US dollar has been a force behind rising inflation, pushing up the costs of imports, in particular foodstuffs.
In his role as OCCI chairman, rather than as a member of the rent committee, Al Khonji called for Oman's food suppliers and distributors to cap prices on a number of staple food items.
"The idea is to cater to the needs of the lower middle class and those sections of society for whom the slightest price can cause a major dent in their budget," Al Khonji told local press on March 10.
The basic items included on the OCCI's list are rice, wheat flour, sugar, lentils, cooking oil, tea, milk powder, evaporated milk and ghee. The chamber has established a group to oversee the scheme and keep the prices of these goods down.
The government is already moving along similar lines, with a ministerial committee unveiling an action plan on March 6 outlining a series of proposals to curb price rises and overcome shortages of supply for some commodities.
Oman's minister of commerce and industry, Maqbool bin Ali Sultan, said the committee's recommendations included increasing quotas for local fishermen and lifting seasonal bans on the importing of some fish species and the catching of some varieties in local waters.
The committee also recommended boosting agricultural output by providing technical and financial assistance to primary producers, including establishing projects to increase cattle, sheep and poultry farming, he said. At the same time, imports of live cattle and goats from neighbouring countries should be allowed, as long as health standards were met, said Ali Sultan.
One other recommendation of the committee was that basic foodstuffs, mainly those also identified by the OCCI, be subject to price control and support, along with cement, and reinforcing bars for the construction industry.
Though subsidies will help keep prices down in the short term, they will prove a drain on the state's coffers, while there is only so much inflation the private sector will be prepared to soak up before passing it on to consumers. Past attempts to police a rent cap have not met with outstanding success either, with landlords often allegedly able to get around restrictions.
The committee's longer-term recommendations to boost food availability hold out promise for the future, but it is in the here and now that Omanis are being hit in the hip pocket. For that pain to ease, a number of stars must align, with the weakening of the US dollar needing to regain some of its lost strength or be decoupled from Oman's rial.
