Borse Dubai: Rich, unloved

The Financial Times reports that Magnus Böcker, chief executive of OMX, has expressed deep misgivings about a possible takeover bid by Borse Dubai. And that was after he met senior executives from the Dubai exchange.

His main gripe is concerns about the transparency and regulation of a market owned by just one shareholder and feared this could undermine OMX's credibility. Despite tabling $4bn bid, higher than rivals Nasdaq, the Dubai is struggling to find favor.

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The devil in the discount

The first five weeks of this year’s DSS have generated $74m in revenues. Visitor numbers are up and the organizers expect a record outcome for all involved.

All of which is excellent news. Maintaining forward momentum for a 10-year-old product in a city as changeable as Dubai is no mean feat. The organizers have to contend with the twin threats of local ambivalence and international competition. The figures seem expected; they’re not, every penny and visitor could have gone elsewhere this summer.

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Veiled opportunity

Arabian Business this morning picks up a story from Reuters on the difficulties faced by niqab-wearing women job seekers in the Gulf. It says applicants are regularly rejected from customer-facing positions, and highlights the retail and banking sectors.

"No one takes women with niqab in the retail sector," says 22-year-old Aysha Obeid, a UAE national, who unsuccessfully applied for jobs at two retail outlets. She is now looking for back office administrative jobs where she believes she may have more chance of being employed.

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Learning to fly

Emirates customers can now select and secure their preferred seats on their flights at the time of booking, when they purchase their tickets online. The service, previously available only to First and Business travelers, is now open to all. This should mean fewer queues, less stress at check-in and a more engaging process for customers. It is also a reward for planning ahead.

The move is in step with other leading carriers. “Travelers increasingly demand the convenience of organizing their itineraries via the Internet,” says Ghaith al Ghaith, Emirates Executive Vice President for Commercial Operations Worldwide.

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Barclays shy of Gulf investors

Barclays interminable pursuit of ABN Amro rumbles on. Today, media reports say the Dutch bank has taken a neutral stance on Barlays bid, recommending neither Barclays nor rivals RBS.

The chase was enlivened last week with news that Barclays had turned to Chinese and Singapore investors for help. China State Development Bank and Singapore's Temasek Holdings agreed to provide up to $18.76 billion to juice a new, $93.1 billion counter-offer composed of 37% cash. The deal will see the China Development Bank take a 3.1% stake in Barclays, with Singaporean investment fund Temasek taking 2.1%; both will take a greater slice should the deal go through.

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From first to third

For a time it had all looked so promising. With the FIA concerned about maximizing the viewing figures for the opening race of the F1 season, and the incumbent Melbourne GP unable to push back its start time, Bahrain was suddenly slated to take pole. With Abu Dhabi joining the calendar in 2009 the odds had looked good for a two-week swing through the Gulf next year. Extra publicity, more time with the teams, better marketing opportunities.

A week on and it has all fallen in a heap. Melbourne will continue as race one, Malaysia is at two, Bahrain at three. It is no disaster but, if no one even remembers who came second, third really is anonymous.

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All in a good cause

Singapore Airlines is to auction off most of the 480 seats on the maiden flight of its new A380, the first commercial flight for the Airbus super-jumbo. The auction will be held on eBay in October and one-third of the revenues will go to charities.

Well done, Singapore Airlines. The charities make good money, the flight creates the feel of a global event, and the airline generates plenty of favorable publicity. Everybody’s a winner.

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Still the place to be

Hidden costs to business may hamper Dubai’s ability to thrive, says a story in today’s Gulf News. The new municipality fee on property, health care, and the Salik toll are helping dilute the benefits of tax-free living, says Eckart Woertz, economist at the Gulf Research Centre.

The paper goes on to say that rising rents, warehousing, education and foodstuffs are seriously jeopardizing Dubai’s prospects. “And with the possibility of a value added tax being introduced, the situation can further deteriorate,” says Woertz, now clearly into his stride.

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CEOs don't grow on trees

If one thing is certain it is that we’ll never be certain why Andre Dose resigned as CEO of Gulf Air. Clashes with the board, disagreements over management style, intrusive external audits…many theories are mentioned, the only truth is that Gulf Air is once again looking for a new chief.

There are few good times to have a CEO quit, but this looks like particularly one. Qatar Airways is going great guns, Emirates is sailing on serenely, and Etihad, helmed by former Gulf Air boss James Hogan, is stepping up. In comparison Gulf Air, with one rebranding and several restructuring plans under its belt, looks dead on its feet.

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Not every loser wins

Emirates has been among the most prolific sponsors of world sport in the last decade. Football, golf, rugby (league and union), sailing, Australian Rules, horse racing and cricket have all been touched by the Fly Emirates tag. Some estimates put the spend at $200m, and that was before the $195m splurged on sponsoring the next two football world cups.

The airline has earned a reputation for picking winners. Critics snipe it has more success buying winners.

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Turning a corner

General Motors is having to recall hundreds of Chevrolet Aveo cars in the UAE. The company says it needs to fix a fault that can cause the fuel line to crack in the event of a front-end collision.

Local distributors say the defect affects 1,488 units of certain 2007 model year Chevrolet Aveo sedans equipped with a 1.4-litre engine.

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Go Mena!

Sama Dubai isn’t the first Gulf company to invest in Tunisia, but it is currently the biggest. By some distance.

The property unit of government-owned Dubai Holding is to spend $14 billion creating a luxury real estate development north of the Tunisian capital. The 837 hectare development will include apartments, offices, trade centers and hotels. Local newspapers claim the deal could create 150,000 jobs, doubly good news in a country with a jobless rate of 14.3%.

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Chinese crackers

Starbucks has been turfed out of the Forbidden City. For some reason this will make lots of people happy, from tea drinkers to anti-globalists. More than 500,000 people signed up to an online petition complaining about the Seattle company’s presence at China’s number one tourist spot, and UNESCO world heritage site.

Why? Starbucks appears to have done nothing wrong, save for selling pricey coffee, and that’s no crime.

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Wanted: buyer with a plan

The Kuwaiti government wants to sell an 80% stake in loss-making national carrier Kuwait Airways, state news agency KUNA said earlier this week.

The news comes as Oman gets to grips with its own Oman Air and Bahrain takes on full responsibility for Gulf Air.

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Merger or train smash?

Everybody approves of the merger of National Bank of Dubai and Emirates Bank. Don’t they?

A new super-bank with assets of $44 billion, the biggest in the Gulf and now capable of challenging internationally, the merger of National Bank of Dubai and Emirates Bank is universally agreed to be a ’good thing’.

"It’s a very good move," says Karti Inamdar, banking analyst with Capital Intelligence, in the Gulf News. "I actually see plus-points all the way in a friendly merger of two healthy banks.”

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Brace yourselves

In the Spring of last year, Trends magazine canvassed the bosses of some of Dubai’s biggest real estate players to get some idea of where things were going in the property market. While mostly bullish – as you’d expect – two predicted a “softening” around February this year. Supply, they said, would finally catch up with demand, to an extent at least, and a correction could well be on the cards. Other analysts I spoke to were less optimistic. By October, according to some, a crash was imminent.

Well, February has come and gone, and there’s been nary a “correction,” never mind the kind of crash that your average hard-pressed (and non-property owning) expat has been hoping for. What’s happening? Was everyone mistaken? If the latest research is anything to go by, absolutely not. The supply-demand crunch has merely been subjected to the same thing that frustrates so many off-plan buyers in the region: construction delays. A correction is coming, and it could be a lot, lot bigger than anyone was expecting.

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Copycat killer

I have often complained vocally about the phenomenon known as “idea poaching,” when agencies steal ideas from one another. I was asked me to rant about this. Here I go.

The fact that I even have to talk about idea poaching is annoying in the extreme. This should be crystal clear to all parties concerned – agencies, advertisers and creatives. I don’t care if you have bi-polar disorder or if you’re taking Prozac suppositories: You know it when an idea didn’t come out of your own head. By deductive logic it must mean the idea belongs to someone else then. Get over it. And if you say the idea is yours, you are nothing by a leprous slag.

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When is a gift just a gift?

What may seem inappropriate in some cultures (being wined and dined by the agency, for example) is normal, if not expected, in others. It’s an especially touchy issue in the Middle East, where turning down a gift can be seen as a grave insult.

“I think it is a bit presumptuous for anyone to believe that an account will move because of lunch or dinner,” says Philip Jabbour, group director of marketing and new business development at Starcom Mediavest. The media buying agency says it doesn’t hand out gifts to clients or potential clients. “Such meals are casual, and at times necessary. What if a day meeting drags over lunch and you invite client for lunch?”

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Trouble at the diploma mill

Three years ago, Ron Bruder was building shopping malls in America. Now he’s in the Middle East, but as a developer of human capital, rather than retail centers. As founder and CEO of Education for Employment, an NGO aimed at boosting the skills of Middle East graduates, he believes graduates have been shortchanged by their colleges and universities.

“A lot of the countries that we’re operating in, there’s a disconnect between the level of education people get and the jobs that they don’t get. It’s an acknowledged disconnect, I’m not telling tales out of school. They go through four years of college and at the end of the day, the joke is they maybe get a bride from a better family, but they don’t get a job. We’re trying to change that,” he says.

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What lies beneath

Credit cards are an essential part of Gulf life, and not just to finance designer clothes and flashy watches. Some bills are practically impossible to pay unless you have the requisite plastic and thus, until the advent of proper debit cards, most wallets held at least one card bearing a Visa or MasterCard logo. These days banks offer credit cards to new customers as a matter of course, and that includes Islamic banks. Yet unlike their mainstream counterparts, Islamic banks, to their chagrin, must field awkward questions about what lies beneath the stamp of Shari’ah compliance. Read More

Safe landing

After 33 years of going nowhere, Gulf Air has made one safe landing that promises to reverse its fortunes. With Oman completely pulling out of the beleaguered airline at a dramatic extraordinary general assembly in May, Bahrain has regained its 100 percent ownership. Most believe the latest turn of events will help the kingdom redefine its priorities and establish itself as a tourism destination using Gulf Air as a catalyst. It’s a case of better late than never as the airline, by its own admission, was bleeding over $1 million a day and even more if other costs such as financing are included. Another estimate suggests that the carrier’s accumulated losses and costs, including for 2007, would amount to 254 million Bahraini dinars ($675 million). Gulf Air was founded in 1974 and was owned equally by the governments of Bahrain and Oman, after Qatar and Abu Dhabi withdrew in 2002 and 2005 respectively. Read More...

Wise move

Given that May was another bumper month for outlandish project announcements in Dubai – the truly gigantic shopping development at Dubailand, which will triple the emirate’s retail real estate, was the biggest – it was welcome indeed to see one new project that is not only grounded in reality, but in history too.

Pearls of Dubai, an initiative by the Dubai Multi-Commodities Center, isn’t going to set the precious stones world alight, but that’s precisely why it’s worth looking at it. It’s not the biggest and not the best project in Dubai, but it has something that is lacking in so many projects in this former pearl diving town: a smattering of authenticity. Read More...

Stalled

Salik, Dubai's first attempt at fixing its commuter traffic problem started today, and everyone in the emirate has an opinion on it. So what's Kipp's view?

First up, Day One cannot have been good for business productivity. There will have been a good number of people who bought the Salik card and enjoyed a clear run along the tolled Sheikh Zayed Road, perhaps most of them shaved a little time of their commute. For the majority, however, journey times increased dramatically; a straw poll in the Kipp office suggests commuting times tripled, many took over two hours on journeys that last week took 30 minutes. Read More...