Archive for August, 2008

In a Financial Times article this week on Dubai property heads off-plan, reports from Standard Chartered and Morgan Stanley were prominently cited in predicting a fall in property prices by the second half of next year, due principally to oversupply. Yet, by Morgan’s own admission, tracking supply as well as demand is difficult because access to data is limited.  The lack of such substantive data did not dissuade Morgan from making a call, which appears to be more speculative than factual.

With undetermined reserves of precious metals, including gold, copper, phosphate, and bauxite, Saudia Arabia may soon rival the output of global producers such as Canada and Australia.  In addition to oil, mineral wealth will undoubtedly accellerate Saudi’s drive to diversify their economy, as evidenced by the government’s planned construction of four new cities.  For more, see article in CNN Money/Fortune Magazine.

Sovereign wealth funds (SWFs) are not new, by any means, but their degree of asset accumulation and willingness to deploy it overseas, is unprecedented. And this is appreciated, by global investment and commercial banks, especially those in the U.S. SWFs are increasingly important players in equity markets and are not only providing some support on the “buy” side, but also are poised to serve as stable shareholders. A great example of this is in Japan, where SWFs have been signaling significant increases to their allocations. Earlier this month, Kuwait (KIA) announced plans to triple its investment in Japan to $48B.  On the flip side, it goes without saying that there are tremendous positive implications for SWF domestic-oriented investment. And on that note, take a look at SWF assets (top-5) and corresponding wealth per capita (clip thumbnail image to enlarge).

Chart Sources: The Economist, Govt. of Norway Pension Fund, Reuters and PRC Embassy in U.S.

MarketWatch.com reports that Research and Markets has compiled information on the 1,100+ largest commercial firms in Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE. The “Middle East 2008 – Arabian Gulf Top List” includes analysis and contact information, and should help to make more visible budding investment and collaboration opportunities in the ME.

Istithmar World, the investment arm of Dubai World, and real estate developer Nakheel invested an undisclosed sum in Montreal-based Cirque, expanding a 15-year partnership between the latter two entities reached last spring. See Reuters clip below.

clipped from www.reuters.com Dubai firms buy stake in Cirque du Soleil Two government-owned investment firms in Dubai have acquired a 20 percent stake in the colorful Canadian acrobatic troupe Cirque du Soleil, furthering the desert city’s plans to expand its tourism appeal and lengthening its list of foreign investments. Cirque du Soleil has annual sales of more than $700 million and attracts nearly 10 million visitors a year, making it one of the world’s largest entertainment businesses.