Egypt has struck a number of LNG supply deals, … · Trafigura, 9 from Vitol, 7 from Noble , and 6...
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Market Movements 04-05-2015 Change Closing pts INDIA - Sensex +479.28 27,490.59 AUSTRALIA - All Ordinaries +17.10 5,815.90 JAPAN - Nikkei (May 1) +11.62 19,531.63 S. KOREA - KRX 100 +24.63 4,294.77 PHILIPPINES - All Shares +44.39 4,497.39 FRANCE - CAC 40 +35.48 5,081.97 EUROPE - Euro Stoxx 50 +17.35 3,632.94 Change Closing pts HONG KONG - Hang Seng -9.18 28,123.82 GERMANY - DAX -165.47 11,619.85 Business Govt awards $6bn worth of contracts in Q1 T he Kuwaiti government issued the bylaws for the 2014 Public Private Partnership(PPP) law on March 29, 2015, essentially kick-starting the long-awaited PPP scheme. The bylaws allow the new Kuwait Authority for Partnership Projects (KAPP) to start tendering stalled PPP projects. These are estimated to be valued at KD 6 billion. According to press reports, phase 1 of the Umm Al- Hayman Wastewater Treatment Plant (WWTP) and the Kabd Municipal Solid Waste Treatment Facility are likely to be the first projects tendered under the new law. KAPP has also issued a request for qualification (RFQ) for phase 2 of the Al-Zour North Independent Water and Power Producer (IWPP) project. However, the IWPP is regulated under a separate law that was issued in 2012 that has also been recently amended to provide the government with more flexibility in executing power projects. According to MEED Projects, Kuwait awarded KD 1.8 billion ($6 bil- lion) worth of contracts in 1Q15. Furthermore, the total value of the country’s projects market (planned and active projects) grew to over KD 68 billion ($230 billion) by the end of 1Q15, its highest level since 2010. Below is a breakdown of develop- ments relating to Kuwait’s major proj- ects in 1Q15. Oil & gas Kuwait National Petroleum Company (KNPC) was hoping to fol- low last year’s successful awarding of the KD 3.4 billion Clean Fuels project in the first quarter with the tendering of the KD 4 billion New Refinery Project (NRP) in 2015. Once completed, the Al-Zour refinery will effectively dou- ble Kuwait’s refining capacity. Meanwhile, Kuwait Oil Company (KOC), the state’s upstream operator, did manage to award the contract for phase 1 of the Lower Fars Heavy Oil Handling Facilities in 1Q15. The KD 1.2 billion ($4 billion) contract was awarded to UK-based Petrofac in February. KOC aims to extract 65,000 barrels per day (bpd) of ‘heavy’ oil from Kuwait’s northern desert by the project’s fifth year. Construction According to MEED Projects, local contractor has been approved for the KD 380 million ($1.2 billion) Jahra Hospital after the Amiri Diwan revived the project in January 2015.The Amiri Diwan also awarded a contract worth KD 8 million ($27 million) for the repair and refurbishment of Jaber International Stadium, the venue for the upcoming Gulf Cup in November 2015. In April 2015, the government issued the bylaws to law 113/2014, allowing the private sector (real estate develop- ers) to develop housing units on land allocated to the Public Authority for Housing Welfare (PAHW). Developers can now buy, develop and sell land from the PAHW to beneficiaries on the PAHW waiting list (at a price set by the PAHW). This should help speed up completion of PAHW’s projects. The authority is also currently working on the vKhairan and Mutlaa city projects. According to the Minister for Housing Affairs, the government aims to start distributing units in Mutlaa by 2016. Power & Water On 9 April, the newly formed Kuwait Authority for Partnership Projects (KAPP)received prequalifica- tion documents for two of its projects: Al-Khairan IWPP and phase 2 of the Al-Zour North IWPP. Implementation of the two projects should expand total power capacity by 1,500 MW and desalination capacity by102 million imperial gallons a day (MIGD) for each plant. Transport According to MEED Projects, the gov- ernment is considering converting the new airport terminal project at Kuwait International airport to a BOT project under the new PPP law. KAPP has already taken formal control of several other projects including both the metro and railroad projects. In November 2014, bids for construction of the airport termi- nal came in well over the KD 1 billion budget, which prompted the government to look for alternative ways to tender the project. Once complete, the new terminal will increase the airport’s capacity to 20 million passengers a year. Kuwait projects market National Bank of Kuwait Egypt has issued a five-year tender to lease a second liquefied natural gas (LNG) import terminal, the head of the state gas board told Reuters on Monday, seeking to tackle an energy crisis. Egypt was once an energy exporter but declining oil and gas production and increasing con- sumption has forced the govern- ment to divert energy supplies to the domestic market, turning the country into a net energy importer. “We launched yesterday a tender to lease a second LNG import ter- minal for a period of five years. We have sent it to eight international companies and we expect to get a reply within a week,” Khaled Abdel Badie said in a telephone interview. The floating regasification and import terminal, which converts super-cooled LNG into gas, would be Egypt’s second. An import ter- minal from Norway’s Hoegh LNG arrived in Egypt last month. Egypt has struck a number of LNG supply deals, including a March agreement with Russia’s Gazprom to import 35 cargoes of LNG. Egypt also agreed in January to import 33 LNG cargoes from Trafigura, 9 from Vitol, 7 from Noble , and 6 from Algeria’s Sonatrach, to be delivered in this year and next. (RTRS) Egypt issues tender for 2nd gas terminal Saudi Arabia’s Al Muhaidib Group has bought a 35 percent stake in building supplies and hardware retail- er Abyat, the adviser to the Kuwaiti- based chain said on Monday. The deal will help Abyat expand into Saudi Arabia and the wider Gulf region, with Al Muhaidib Group ben- efiting from an increased presence in the building materials sector, said Bader al-Rezaihan, chairman of Amwal International Investment Co. “There is definitely an aggressive growth plan for Abyat, especially with the support of Al Muhaidib,” Rezaihan told Reuters, noting that Abyat was opening its second Saudi Arabian shop, in Riyadh, this week and was about to break ground on a store in Jeddah. Rezaihan declined to give a value for the deal but said Al Muhaidib bought out many minority shareholders using its own cash, leaving 11 shareholders including the Saudi group. Abyat, which had 26 shareholders before the transaction, according to its website, is majority-owned by its founder and chairman Khalid Abul. Family-owned conglomerate Al Muhaidib, which has investments including Savola Group and Saudi British Bank , aims to use its regional experience to advise Abyat on expansion. (RTRS) Al Muhaidib buys stake in Kuwait’s Abyat Burgan Bank records KD 17.5mn net in Q1 Operating income grows 14% to KD 70.5 mln; EPS 6 fils KUWAIT CITY, May 4: Burgan Bank Group announced its first quarter earnings for 2015 reflecting a continuation of the faster than market growth trend the bank is consistently demonstrating while contin- uing to prudently build cov- erage amid the complexity of the regional operating envi- ronment. Net profit reported at KD 17.5 mil- lion while earning per share reported at 6 fils. Compared to the same peri- od last year, Operating income surged to KD 70.5 million registering a growth of 14 percent while Operating Profits before provisions soared to register KD 38.2 million reflecting a growth of 12 percent. The performance during the first quar- ter of 2015 delivered a continuous solid growth in all business lines across the group with high quality earnings regis- tered during the quarter, net interest income grew by 14 percent reaching KD 47.4 million while net fees and commis- sion grew by 6 percent reaching KD 11.6 million. Majed Essa Al Ajeel, Chairman of Burgan Bank Group said: “ once Again, our focused execution of our strategy is yielding solid operating performance and the bank is continuing to demonstrate faster than market growth trend almost in all indicators.” Added Al-Ajeel Majed Essa Al-Ajeel also said: “Our leading financial indicators continue to point to the right direction, Our regional operations remain profitable and con- tributing 53 percent to the group’s rev- enues . I remain confident and optimistic of the group’s strong performance going forward. “ “Our Balance sheet remains strong. Our asset quality continues to improve as non-performing assets (net of collateral) to gross facilities stands at 1.7 percent and a strong coverage consisting of KD266 million including over KD100 million in specific and general provisions represent- ing a coverage ratio (net of collateral) over 200 percent. Our capital position is solid and fully compliant with Basel 3, our capital adequacy ratio stands at 13.3 percent for the period ending March 31, 2015. Our liquidity ratio which is one of the strongest compared to our peers stands at +30 percent at March 31, 2015. “On behalf of the board, I take this opportunity to thank our customers and shareholders for their confidence in our capabilities. I would also like to thank our executive management team for their leadership and the excellent execution of the corporate strategy, and to our staff for their continued support and commit- ment,” concluded Al Ajeel. The consolidated financials encompass the results of the Group’s operations in Kuwait, and its share from its regional subsidiaries, namely Jordan Kuwait Bank, Gulf Bank Algeria, Burgan Bank — Turkey, Bank of Baghdad, Tunis International Bank, in which Burgan Bank owns a majority stake. Burgan Bank Group has one of the largest region- al branch networks with more than 235 branches across Kuwait, Turkey, Jordan, Algeria, Iraq, Tunis, Lebanon and Palestine. Move to review energy investment opportunities US delegation to visit Iran this wk ANKARA, May 4, (RTRS): A US del- egation will visit Iran to review energy investment opportunities while Tehran negotiates a final deal with world pow- ers on its nuclear programme, a senior oil ministry official told Mehr news agency on Monday. The United States has imposed sanc- tions on Tehran which prohibit Americans from trading directly or indirectly with Iran’s oil sector, gov- ernment or individuals connected to the sector, including any financing. US companies are also prevented from investing in Iran’s oil and gas industries or trading with them. “It is forecast that by the visit of (the) American delegation this week and in the case of lifting sanctions on Iran’s oil industry, we will witness involve- ment of major international American oil and gas companies in Iran in the future,” said deputy Oil Minister Abbas Sheri-Moghaddam. Friday is the last day of the week in Iran. A tentative deal between Iran and the powers was reached in Switzerland on April 2 that cleared the way for a final settlement on June 30, in which Tehran would agree to restrict sensitive nuclear work in exchange for sanctions relief. Sheri-Moghaddam did not reveal any details, but added that some “European-American companies” have expressed readiness to invest in Iran’s new petrochemical projects. Western sanctions have cut Iran’s oil exports by more than half to around 1.1 million bpd from a pre- 2012 level of 2.5 million bpd, with the loss of oil income making it difficult to invest in new development and pay for the equipment and services needed to keep its production operating smoothly. The sanctions imposed by the United States and European Union on Iran since 2012 have led to the gradual departure of major Western oil compa- nies from Iran. Iranian officials have repeatedly said Teheran places no limitations on Western companies, including US companies, investing in its oil and gas sector. In 2013, Iran’s Oil Minister Bijan Zanganeh said seven Western compa- nies were welcome to return to Iran to explore oil after international sanctions are lifted, including the US majors ExxonMobil and ConocoPhillips. GCC employment, salary trends Private sector salaries to rise 6.9 pct Kuwait eyes more jobs in 2015 DUBAI, May 4: Overall employment across the GCC is on the increase in 2015, despite the fall in oil prices, according to the latest edition of the research report “Employment and Salary Trends in the Gulf” released today by GulfTalent, the Middle East’s leading online recruitment portal. The report found healthcare to be the fastest growing sector across the region, with 82 percent of employers in the sector increasing their head- count last year and 79 percent plan- ning to do so in 2015. Key drivers of this growth were found to be massive government investment, the region’s fast-growing population, and regulato- ry changes in most GCC countries requiring companies to provide health insurance for employees. Among GCC countries, Qatar is expected to enjoy the highest rate of job creation in 2015. With the uncer- tainty over the World Cup finally removed and major infrastructure proj- ects getting the go-ahead, 66 percent of employers in Qatar reported plans to increase headcount. GulfTalent’s research found that, while the oil price slump had resulted in a slowdown in the oil and gas sector and some cut-backs in Oman and Bahrain, most employers in the region were as yet unaffected by it. This is consistent with data from Abu Dhabi Commercial Bank (ADCB), which reported a 10 percent increase in projects awarded across the GCC during the first quarter of 2015, compared to the same period last year. A significant portion of these was com- prised of projects awarded in Qatar. The governments of Saudi Arabia, Qatar and the UAE have this year been drawing on their vast cash reserves to make up for the lower oil revenues in order to meet their planned spending and investments. Bahrain and Oman have experi- enced a greater impact, due to their lower reserves and higher dependence on the oil revenue. According to data from the International Monetary Fund, the government of Bahrain needs to sell its oil at $125 per barrel to balance its budget, compared with the current price of oil at $66. Across most of the GCC, private sector salaries are forecast to rise at a similar pace in 2015 compared with the previous year. Qatar is expected to see the highest average pay increase at 8.3 percent, driven by rising cost of living and the growing need to attract talent for completion of projects. Employers in Oman, under pressure from an increasingly unionized work- force, are forecast to give the second highest average pay rise at 7.2 percent. Saudi Arabia and the UAE are next, with expected average pay rises of 7.1 percent, followed by Bahrain at 7.0 percent. Kuwait is expected to see the lowest average pay rise at 5.0 percent. Among sectors, construction is fore- cast to have the highest average salary increase at 10 percent, while oil & gas sector is expected to be the lowest at 5.4 percent. Creating jobs for nationals remains a hot issue across the Gulf. Employers in Saudi Arabia and Oman, under pres- sure from their governments to meet tough nationalization targets, cited attraction and retention of skilled nationals as their biggest human resource challenge. On the expatriate front, employers across the region are finding it increas- ingly challenging to attract profession- als from India, traditionally a key source of talent for the Gulf. The growth of the Indian economy is leading to more job opportunities and increasingly attractive salaries at home. According to the International Monetary Fund, India is expected to be the world’s fastest grow- ing major economy in 2015, surpassing China’s growth rate for the first time since 1999. GulfTalent’s report also found that conflicts across the Middle East have led to an increased supply of talent from the affected countries seeking opportu- nities in the Gulf. However, employers were often frustrated in their attempts to absorb this talent pool, due to restric- tions put in place by most GCC govern- ments on granting employment visas to nationals of the affected countries, notably Syria and Egypt. GulfTalent’s report is based on an online survey of 600 employers and 22,000 professionals, as well as 60 interviews with executives and HR professionals, conducted during the period December 2014 to April 2015. Majed Essa Al Ajeel
Transcript of Egypt has struck a number of LNG supply deals, … · Trafigura, 9 from Vitol, 7 from Noble , and 6...
Market Movements 04-05-2015Change Closing pts
INDIA - Sensex +479.28 27,490.59AUSTRALIA - All Ordinaries +17.10 5,815.90JAPAN - Nikkei (May 1) +11.62 19,531.63S. KOREA - KRX 100 +24.63 4,294.77PHILIPPINES - All Shares +44.39 4,497.39FRANCE - CAC 40 +35.48 5,081.97 EUROPE - Euro Stoxx 50 +17.35 3,632.94
Change Closing ptsHONG KONG - Hang Seng -9.18 28,123.82GERMANY - DAX -165.47 11,619.85 Business
Govt awards $6bn worth of contracts in Q1The Kuwaiti government issued the
bylaws for the 2014 Public PrivatePartnership(PPP) law on March 29,2015, essentially kick-starting thelong-awaited PPP scheme. The bylawsallow the new Kuwait Authority forPartnership Projects (KAPP) to starttendering stalled PPP projects.
These are estimated to be valued atKD 6 billion. According to pressreports, phase 1 of the Umm Al-Hayman Wastewater Treatment Plant(WWTP) and the Kabd MunicipalSolid Waste Treatment Facility arelikely to be the first projects tenderedunder the new law. KAPP has alsoissued a request for qualification(RFQ) for phase 2 of the Al-Zour NorthIndependent Water and PowerProducer (IWPP) project. However, theIWPP is regulated under a separate lawthat was issued in 2012 that has alsobeen recently amended to provide thegovernment with more flexibility inexecuting power projects.
According to MEED Projects,Kuwait awarded KD 1.8 billion ($6 bil-lion) worth of contracts in 1Q15.
Furthermore, the total value of thecountry’s projects market (planned andactive projects) grew to over KD 68billion ($230 billion) by the end of1Q15, its highest level since 2010.
Below is a breakdown of develop-ments relating to Kuwait’s major proj-ects in 1Q15.
Oil & gasKuwait National Petroleum
Company (KNPC) was hoping to fol-low last year’s successful awarding ofthe KD 3.4 billion Clean Fuels projectin the first quarter with the tendering ofthe KD 4 billion New Refinery Project(NRP) in 2015. Once completed, theAl-Zour refinery will effectively dou-ble Kuwait’s refining capacity.
Meanwhile, Kuwait Oil Company(KOC), the state’s upstream operator,did manage to award the contract for
phase 1 of the Lower Fars Heavy OilHandling Facilities in 1Q15. The KD1.2 billion ($4 billion) contract wasawarded to UK-based Petrofac inFebruary. KOC aims to extract 65,000barrels per day (bpd) of ‘heavy’ oilfrom Kuwait’s northern desert by theproject’s fifth year.
ConstructionAccording to MEED Projects, local
contractor has been approved for theKD 380 million ($1.2 billion) JahraHospital after the Amiri Diwan revivedthe project in January 2015.The AmiriDiwan also awarded a contract worthKD 8 million ($27 million) for the
repair and refurbishment of JaberInternational Stadium, the venue forthe upcoming Gulf Cup in November2015.
In April 2015, the government issuedthe bylaws to law 113/2014, allowingthe private sector (real estate develop-ers) to develop housing units on landallocated to the Public Authority forHousing Welfare (PAHW). Developerscan now buy, develop and sell landfrom the PAHW to beneficiaries on thePAHW waiting list (at a price set by thePAHW). This should help speed upcompletion of PAHW’s projects. Theauthority is also currently working on
the vKhairan and Mutlaa city projects.According to the Minister for HousingAffairs, the government aims to startdistributing units in Mutlaa by 2016.
Power & WaterOn 9 April, the newly formed
Kuwait Authority for PartnershipProjects (KAPP)received prequalifica-tion documents for two of its projects:Al-Khairan IWPP and phase 2 of theAl-Zour North IWPP. Implementationof the two projects should expand totalpower capacity by 1,500 MW anddesalination capacity by102 millionimperial gallons a day (MIGD) foreach plant.
TransportAccording to MEED Projects, the gov-
ernment is considering converting thenew airport terminal project at KuwaitInternational airport to a BOT projectunder the new PPP law. KAPP hasalready taken formal control of severalother projects including both the metroand railroad projects. In November 2014,bids for construction of the airport termi-nal came in well over the KD 1 billionbudget, which prompted the governmentto look for alternative ways to tender theproject. Once complete, the new terminalwill increase the airport’s capacity to 20million passengers a year.
Kuwait projects marketNational Bank of Kuwait
Egypt has issued a five-year tenderto lease a second liquefied naturalgas (LNG) import terminal, thehead of the state gas board toldReuters on Monday, seeking totackle an energy crisis.
Egypt was once an energyexporter but declining oil and gasproduction and increasing con-sumption has forced the govern-ment to divert energy supplies tothe domestic market, turning the
country into a net energy importer.“We launched yesterday a tender
to lease a second LNG import ter-minal for a period of five years. Wehave sent it to eight internationalcompanies and we expect to get areply within a week,” Khaled AbdelBadie said in a telephone interview.
The floating regasification andimport terminal, which convertssuper-cooled LNG into gas, wouldbe Egypt’s second. An import ter-
minal from Norway’s Hoegh LNGarrived in Egypt last month.
Egypt has struck a number ofLNG supply deals, including a Marchagreement with Russia’s Gazpromto import 35 cargoes of LNG.
Egypt also agreed in January toimport 33 LNG cargoes fromTrafigura, 9 from Vitol, 7 fromNoble , and 6 from Algeria’sSonatrach, to be delivered in thisyear and next. (RTRS)
Egypt issues tender for 2nd gas terminal
Saudi Arabia’s Al Muhaidib Grouphas bought a 35 percent stake inbuilding supplies and hardware retail-er Abyat, the adviser to the Kuwaiti-based chain said on Monday.
The deal will help Abyat expandinto Saudi Arabia and the wider Gulfregion, with Al Muhaidib Group ben-efiting from an increased presencein the building materials sector, saidBader al-Rezaihan, chairman ofAmwal International Investment Co.
“There is definitely an aggressivegrowth plan for Abyat, especiallywith the support of Al Muhaidib,”Rezaihan told Reuters, noting thatAbyat was opening its secondSaudi Arabian shop, in Riyadh, thisweek and was about to breakground on a store in Jeddah.
Rezaihan declined to give avalue for the deal but said AlMuhaidib bought out many minorityshareholders using its own cash,
leaving 11 shareholders includingthe Saudi group.
Abyat, which had 26 shareholdersbefore the transaction, according toits website, is majority-owned by itsfounder and chairman Khalid Abul.
Family-owned conglomerate AlMuhaidib, which has investmentsincluding Savola Group and SaudiBritish Bank , aims to use itsregional experience to adviseAbyat on expansion. (RTRS)
Al Muhaidib buys stake in Kuwait’s Abyat
Burgan Bank recordsKD 17.5mn net in Q1
Operating income grows 14% to KD 70.5 mln; EPS 6 fils
KUWAIT CITY, May 4:Burgan Bank Groupannounced its first quarterearnings for 2015 reflecting acontinuation of the fasterthan market growth trendthe bank is consistentlydemonstrating while contin-uing to prudently build cov-erage amid the complexity ofthe regional operating envi-ronment.
Net profit reported at KD 17.5 mil-lion while earning per share reportedat 6 fils. Compared to the same peri-od last year, Operating incomesurged to KD 70.5 million registeringa growth of 14 percent whileOperating Profits before provisionssoared to register KD 38.2 millionreflecting a growth of 12 percent.
The performance during the first quar-ter of 2015 delivered a continuous solidgrowth in all business lines across thegroup with high quality earnings regis-tered during the quarter, net interestincome grew by 14 percent reaching KD47.4 million while net fees and commis-sion grew by 6 percent reaching KD 11.6million.
Majed Essa Al Ajeel, Chairman ofBurgan Bank Group said: “ once Again,
our focused execution of our strategy isyielding solid operating performance andthe bank is continuing to demonstratefaster than market growth trend almost inall indicators.” Added Al-Ajeel
Majed Essa Al-Ajeel also said: “Ourleading financial indicators continue topoint to the right direction, Our regionaloperations remain profitable and con-tributing 53 percent to the group’s rev-enues . I remain confident and optimisticof the group’s strong performance goingforward. “
“Our Balance sheet remains strong.Our asset quality continues to improve asnon-performing assets (net of collateral)to gross facilities stands at 1.7 percent anda strong coverage consisting of KD266million including over KD100 million inspecific and general provisions represent-ing a coverage ratio (net of collateral)over 200 percent. Our capital position issolid and fully compliant with Basel 3,our capital adequacy ratio stands at 13.3percent for the period ending March 31,2015. Our liquidity ratio which is one ofthe strongest compared to our peers standsat +30 percent at March 31, 2015.
“On behalf of the board, I take thisopportunity to thank our customers andshareholders for their confidence in ourcapabilities. I would also like to thank ourexecutive management team for theirleadership and the excellent execution ofthe corporate strategy, and to our staff fortheir continued support and commit-ment,” concluded Al Ajeel.
The consolidated financials encompassthe results of the Group’s operations inKuwait, and its share from its regionalsubsidiaries, namely Jordan KuwaitBank, Gulf Bank Algeria, Burgan Bank— Turkey, Bank of Baghdad, TunisInternational Bank, in which BurganBank owns a majority stake. BurganBank Group has one of the largest region-al branch networks with more than 235branches across Kuwait, Turkey, Jordan,Algeria, Iraq, Tunis, Lebanon andPalestine.
Move to review energy investment opportunities
US delegation to visit Iran this wkANKARA, May 4, (RTRS): A US del-egation will visit Iran to review energyinvestment opportunities while Tehrannegotiates a final deal with world pow-ers on its nuclear programme, a senioroil ministry official told Mehr newsagency on Monday.
The United States has imposed sanc-tions on Tehran which prohibitAmericans from trading directly orindirectly with Iran’s oil sector, gov-ernment or individuals connected to thesector, including any financing.
US companies are also preventedfrom investing in Iran’s oil and gasindustries or trading with them.
“It is forecast that by the visit of (the)American delegation this week and inthe case of lifting sanctions on Iran’soil industry, we will witness involve-ment of major international American
oil and gas companies in Iran in thefuture,” said deputy Oil Minister AbbasSheri-Moghaddam.
Friday is the last day of the week inIran.
A tentative deal between Iran and thepowers was reached in Switzerland onApril 2 that cleared the way for a finalsettlement on June 30, in which Tehranwould agree to restrict sensitivenuclear work in exchange for sanctionsrelief.
Sheri-Moghaddam did not revealany details, but added that some“European-American companies” haveexpressed readiness to invest in Iran’snew petrochemical projects.
Western sanctions have cut Iran’soil exports by more than half toaround 1.1 million bpd from a pre-2012 level of 2.5 million bpd, with the
loss of oil income making it difficultto invest in new development and payfor the equipment and services neededto keep its production operatingsmoothly.
The sanctions imposed by the UnitedStates and European Union on Iransince 2012 have led to the gradualdeparture of major Western oil compa-nies from Iran.
Iranian officials have repeatedly saidTeheran places no limitations onWestern companies, including UScompanies, investing in its oil and gassector.
In 2013, Iran’s Oil Minister BijanZanganeh said seven Western compa-nies were welcome to return to Iran toexplore oil after international sanctionsare lifted, including the US majorsExxonMobil and ConocoPhillips.
GCC employment, salary trends
Private sector salaries to rise 6.9 pct
Kuwait eyes more jobs in 2015DUBAI, May 4: Overall employmentacross the GCC is on the increase in2015, despite the fall in oil prices,according to the latest edition of theresearch report “Employment andSalary Trends in the Gulf” releasedtoday by GulfTalent, the Middle East’sleading online recruitment portal.
The report found healthcare to bethe fastest growing sector across theregion, with 82 percent of employersin the sector increasing their head-count last year and 79 percent plan-ning to do so in 2015. Key drivers ofthis growth were found to be massivegovernment investment, the region’sfast-growing population, and regulato-ry changes in most GCC countriesrequiring companies to provide healthinsurance for employees.
Among GCC countries, Qatar isexpected to enjoy the highest rate ofjob creation in 2015. With the uncer-tainty over the World Cup finallyremoved and major infrastructure proj-ects getting the go-ahead, 66 percentof employers in Qatar reported plansto increase headcount.
GulfTalent’s research found that,while the oil price slump had resultedin a slowdown in the oil and gas sectorand some cut-backs in Oman andBahrain, most employers in the regionwere as yet unaffected by it.
This is consistent with data fromAbu Dhabi Commercial Bank(ADCB), which reported a 10 percentincrease in projects awarded across theGCC during the first quarter of 2015,compared to the same period last year.A significant portion of these was com-prised of projects awarded in Qatar.
The governments of Saudi Arabia,Qatar and the UAE have this year beendrawing on their vast cash reserves tomake up for the lower oil revenues inorder to meet their planned spendingand investments.
Bahrain and Oman have experi-enced a greater impact, due to theirlower reserves and higher dependence
on the oil revenue. According to datafrom the International Monetary Fund,the government of Bahrain needs tosell its oil at $125 per barrel to balanceits budget, compared with the currentprice of oil at $66.
Across most of the GCC, privatesector salaries are forecast to rise at asimilar pace in 2015 compared withthe previous year. Qatar is expected tosee the highest average pay increase at8.3 percent, driven by rising cost ofliving and the growing need to attracttalent for completion of projects.Employers in Oman, under pressurefrom an increasingly unionized work-force, are forecast to give the secondhighest average pay rise at 7.2 percent.
Saudi Arabia and the UAE are next,with expected average pay rises of 7.1percent, followed by Bahrain at 7.0percent. Kuwait is expected to see thelowest average pay rise at 5.0 percent.
Among sectors, construction is fore-cast to have the highest average salaryincrease at 10 percent, while oil & gassector is expected to be the lowest at5.4 percent.
Creating jobs for nationals remainsa hot issue across the Gulf. Employersin Saudi Arabia and Oman, under pres-sure from their governments to meettough nationalization targets, cited
attraction and retention of skillednationals as their biggest humanresource challenge.
On the expatriate front, employersacross the region are finding it increas-ingly challenging to attract profession-als from India, traditionally a key sourceof talent for the Gulf. The growth of theIndian economy is leading to more jobopportunities and increasingly attractivesalaries at home. According to theInternational Monetary Fund, India isexpected to be the world’s fastest grow-ing major economy in 2015, surpassingChina’s growth rate for the first timesince 1999.
GulfTalent’s report also found thatconflicts across the Middle East haveled to an increased supply of talent fromthe affected countries seeking opportu-nities in the Gulf. However, employerswere often frustrated in their attempts toabsorb this talent pool, due to restric-tions put in place by most GCC govern-ments on granting employment visas tonationals of the affected countries,notably Syria and Egypt.
GulfTalent’s report is based on anonline survey of 600 employers and22,000 professionals, as well as 60interviews with executives and HRprofessionals, conducted during theperiod December 2014 to April 2015.
Majed Essa Al Ajeel
