Airline travel has always been big business in the UAE with airports constantly under development in order to bring more people into the region. However things have always been less successful on the domestic front.
This week it was announced that the UAE will have its first domestic passenger airline with a new regional airline planning to launch a regular domestic service from Fujairah. The airline, Eastern Express, said it will commence operations out of Fujairah International Airport during the first quarter of 2012 with flights to Abu Dhabi and other GCC destinations.
Initially the airline plans two daily flights linking Fujairah to the world through Abu Dhabi, and later through other GCC destinations. Speaking to the Khaleej Times, Eastern Express CEO, Alex de Vos said: “It is first regular domestic airline in the UAE and after Abu Dhabi the next destination will be Bahrain after a few months.”
Up until now the only way to travel internally has been by train or bus with Etihad Airways even providing coaches between Dubai and Abu Dhabi International Airport for Etihad customers. Previous attempts have also stalled due to the expense and the financial crisis, so what makes this project different?
Eastern Express has already organised partnerships with other international airlines operating out of Abu Dhabi in order to provide quick connections to its passengers, however these particular airlines are still unknown.
Financing is also being supplied by Al Hajjar Aviation who are putting in $3.5 million to fund the leasing of its first aircraft. Passengers will be able to buy low-cost tickets and fly in between emirates.
So if you currently have to drive around the region, soon you could travel to Fujairah International Airport, get seated and be airborne within half an hour. The plan is also expected to increase regional tourism.
Here’s hoping it takes off.
One of Dubai’s most opulent creations are the artificial archipelagos known as the Palm Jumeirah and the Palm Jebel Ali. A third, the Palm Deira, was planned but the credit crunch hit shortly before construction was due to begin. It seems that Qatar is going to pick up where Dubai left off with new plans to build a $500 million resort project on a “semi-submerged reserve.”
The project, known as The Amphibious 1000 and which will bear a striking similarity to a palm tree, will be built in the middle of a marine reserve and has been designed by Italian firm Giancarlo Zema Design Group. It will feature four giant hotels with underwater rooms that resemble super-yachts and 80 “jellyfish” self-contained floating suites that will each have four floors and an underwater “aquarium lounge”. According to Giancarlo Zema: “It is like a big aquatic animal stretching out from the land into the sea and extends horizontally for one kilometre thanks to two long wide arms”.
To get a sense of size, the ambitious project will transport its guests around the resort via hydrogen-powered 20 metre aluminium yachts. As well as being environmentally friendly with their hi-tech power sources, the yachts will also be equipped with underwater viewing areas so guests can view the local aquatic wildlife.
On land there will be a museum, floating walkways, a restaurant with panoramic views, exhibitions, aquariums and a glass tunnel that will lead to the underwater observatory in the centre of the marine park.
Every good CEO knows the importance of utilising social media networks to promote their company. Whether it is Twitter, Facebook or YouTube, you would be hard pressed to find a business that is not using social media to garner new clients.
The same is happening in the Gulf, where, according to a new report from Regus, over the past year half of companies have successfully used social networks, blogs, microblogs and forums to win new business.
The report stated that social media has been embraced all over the world in the past year with global businesses reporting a 7% rise in successfully recruiting new customers through social networks such as Facebook. As a result, over 52% of businesses around the world now use social media to engage with their customer base, but in the Gulf it is much higher.
An impressive 62% of Gulf businesses use the likes of Twitter and Weibo to engage, connect with and inform existing customers. On top of that 59% of Gulf firms encourage their employees to join social networks such as Linkedin, Xing and Video whereas only 53% did so globally.
Social media was also considered important in marketing with nearly a third of Gulf businesses (32%) devoting up to 20% of their marketing budget to advertising on social networks. Rather than simply being a way for companies to plug promotions and press releases, social media networks have become a major new business strategy with 74% of global companies (69% in the Gulf) saying that they play a key part in daily operations.
However before you go and join every social media network going, note that 82% of Gulf firms stated that a balance between traditional and digital techniques is needed for successful business.
Speaking to AMEInfo.com, Mark Dixon, CEO of Regus said,
“As businesses emerge from the downturn they are increasingly reconsidering pre-recession working practices and opting for more flexible, competitive strategies. From supply chain management, to leaner working practices, to cloud computing, to increased use of video communications and mobile working no area of business is being overlooked. The rapid development of social media as a core business tool is clearly part of this transformation as more and more companies are leveraging this channel to increase the loyalty of existing customers, and as a successful acquisition tool.”
In a clear sign that the UAE’s luxurious lifestyle is making a comeback, Aston Martin – James Bond’s car of choice – has announced it is to treat the local populous with the finest accessories they could ever wish for. Oh, and of course, top of the range cars.
In an interview with Zawya, Adham Charanoglu, CEO at the carmaker’s Middle East and North Africa headquarters, said that the complete Aston Martin experience would see the brand offer everything from fashion to leather accessories.
As you’d expect, all of Aston Martin’s products would come with steep price tags, but the carmakers believes that the UAE economy is strong enough to attract a large customer base. It is not just in the Middle East where Aston Martin is making its presence felt; they are also expanding into other parts of North Africa and Asia.
“At the time we set up the office, there were about five dealerships. Today, we have that number up to beyond 13” Charanoglu said. “We are reshaping our presence in some countries where we believe it has to be done in a proper way.”
He continues:
“We don’t see the product as being purely automotive. It’s a mix of automotive and luxury. We prefer our dealers to come with the same mentality, for at the end of the day we are not only selling engines. Here you are buying a very exclusive combination, which has to do with luxury, sport, uniqueness, power and beauty.”
Those are the very qualities that the UAE was famed for before the debt crisis, but it seems that the region’s rejuvenation means that once again there is a demand for fine cars and even finer accessories.
“In the UAE, we are going to have a new showroom in Dubai by the end of the year, and another for Abu Dhabi as soon as we sign a representation. We plan to announce the partner in Dubai before the end of the summer. All across, we are moving to another level. We recently added Oman and we have three locations in Saudi Arabia. The biggest market should be the UAE. That’s what we are attempting to attain as soon as we get to a well set-up dealership arrangement.” Charanoglu added.
Expect the UAE’s biggest and brightest to soon be driving down the E11 road in Aston Martin DBSs blasting down the James Bond theme tune.
Gulf Stocks Holding Against Greek Crisis
Well, considering Dubai’s debt crisis of the last few years, Europe’s financial woes and the political shifts in the region – not as badly as expected.
Of course, all these factors have had an effect. Speaking to Arab News, Wajdi Makhamreh, CEO of the Amman-based Noor Investments brokerage, said of the debt crisis:
“I believe Arab markets, particularly in the Gulf area, continue to suffer from the Greek and Italian debt debacle, concerns over the world economic recovery and the ongoing Arab revolts.”
He added, that with semi-annual earnings, high oil prices and the huge public spending in GCC countries regional stocks are expected to improve in the medium and long terms. For now though it seems the region is waiting to see what happens – stocks are slightly dipping and rising and investors are just as cautious as the public.
This was backed up by Saudi analyst Mohammad Anqari who commented:
“I believe the market is in a wait-and-see mood where investors watch the release of the half-year results of all listed firms.”
But, Anqari said, there may be a light at the end of the tunnel – the Saudi banking sector. Thanks to its success in getting rid of allocations for toxic loans, it is seen as a key attracting area for local and foreign investors. If Saudi stocks were to receive pressure from global markets and world recovery problems it could lead to high oil prices and huge Saudi public spending.
In fact, with the Kuwaiti stock exchange recording its deepest half-year loss in 13 years and the UAE stocks reflecting mixed performance, hope for the region could lie with Saudi Arabia.
All around the world, Internet usage is a major part of people’s lives be it for their businesses or their personal lives. With nearly every aspect of our lives now online, it is no surprise to know that Internet usage has grown, but in the Middle East it has surged by an astounding 1,987% since 2000 – this is the highest increase anywhere in the world.
With over 70 million online users, the Middle East is not only enjoying an Internet Renaissance, but also an increase in malware and attacks on websites. As an result, countries such as Saudi Arabia have seen many Internet security firms launch with solutions to combat the online threats. One of the most popular solutions is, of course, the Microsoft Security Essentials (MSE) solution that comes with the Windows 7 OS.
The online threats have not just become a threat against office and business computers, but also, according to AlFalak Electronic Equipment & Supplies Co., a major source of income for online criminals. Saudi Arabia in particular, as the region’s largest IT market, has found itself becoming a regular target for hackers that wish to use the country’s ever-growing broadband capabilities for financial gain.
In order to protect users, software such as Microsoft security products are being recommended in order to provide advanced real-time protection for home and small business’s PCs against viruses, spyware and other malicious software. In fact, considering its broad defences, MSE has been named as one of the Middle East’s best online tools for safeguarding networks and systems.
“Microsoft Security Essentials offers all genuine Windows users state-of-the-art protection in a convenient and non-intrusive manner. It is an important part of the Windows 7 package that we encourage our customers to take full advantage of. MSE embodies the kind of accessible solutions the region needs as it rapidly transforms to a knowledge-based economy” said Ahmed Ashadawi, CEO and President, Al-Falak Electronic Equipment & Supplies Co.
Rail systems are continuing to prosper in the Middle East with news that Ethihad Rail has been awarded a contract to head a Dh40 billion rail project which will link the major cities of the UAE.
Similar to the epic GCC rail system, which will link Kuwait City with Al-Dammam in Saudi Arabia, the Bahraini capital Manama, the Qatari capital Doha, the UAE capital Abu Dhabi and the Omani capital Muscat, the UAE rail project will be a massive undertaking.
Phase one of the UAE project will be the construction of a 266km route that will link Shah, Habshan and Ruwais in Abu Dhabi’s Western Region. While that may seem like an impressive feat in its own right, the contract will see Etihad Rail eventually lay over 1,200km of tracks during the rail network’s construction.
As part of the project, Etihad Rail have partnered with PCM Strescon Overseas Ventures Limited who will design and manufacture the railway sleepers. Experts in the creation of pre-stressed concrete sleepers, PCM Strescon are well established in Saudi Arabia where they boast the world’s highest production capacities.
Etihad Rail CEO Richard Bowker said of the large contract:
“We are delighted to announce that Etihad Rail will be working with PCM Strescon, a leader in the industry. This award clearly highlights that we are moving full speed ahead with the railway network — one that will transform the transport sector in the UAE. We look forward to announcing news of further important contract developments over the coming months.”
The epic rail project is expected to, over the next 20 years, transport up to 50 million tonnes of freight and 16 million passengers a year. As the UAE rail project grows, it is also expected to form part of the larger GCC rail network transforming how people and goods are transported around the Middle East.
As well as other Middle Eastern countries, BMI analysts believe that high costs in the region “may force private patients to look at Asian destinations like Thailand for more affordable treatment”. However Jordan is seeking to maintain their medical dominance with recent pro-democracy concessions helping to alleviate fears of further unrest and falling revenue.
So, who are potential rivals to Jordan’s medical tourism sector? According to the BMI, it is the UAE, Saudi Arabia and Qatar that have made the most significant investments to encourage medical tourism. Other countries, such as Oman, have been doing the same, but as protests in the country intensify, it is doubtful that patients would choose Oman over Jordan.
Large health care cities such as Dubai, Doha and Saudi Arabia are likely to attract patients willing to pay higher prices, BMI said for patients willing to pay higher prices, the health care cities could gain a decent market share.
In their report BMI stated that for Jordan “a loss of 25 percent of this revenue is a big economic problem as the country’s fiscal deficit is already stretched to appease domestic pro-democracy protesters.” In recent months, the country has seen a 90 percent fall in Libyan patient numbers, a 60 percent drop in Syria and a 50 percent drop from Yemen and Bahrain as patients have voted with their feet.
Before the protests, Jordan attracted more than 220,000 Arab patients and 45,000 foreigners in 2010, up 25 percent from 2009 according to the PHA. If they are to keep those figures, then Jordan is going to have to work hard to secure it’s medical tourism sector.
Qatar is the richest nation in the world
Move over U.S.A. Get out the way China. There’s a new world power on the block – Qatar.
According to a report by Global Finance (a leading U.S. business magazine) Qatar is the wealthiest nation on the planet.
Thanks to its vast natural gas supplies, Qatar has steadily climbed the global rich list, overtaking the likes of Kuwait and the UAE (who are also in the Top 20) … In case you were wondering, Luxembourg was second.
According to Global Finance, their wealth classification was based on comparing the living standards of the overall population by using gross domestic product (GDP) per capita based on party or purchasing power balance internationally. It said the method uses indicators of the relative cost of living, inflation, and exchange rate of a country.
As a result, Qatar eclipses the likes of the U.S.A, China, Japan and Germany with a GDP per capita of $ 90,149 in 2010. The poorest country is the Republic of Congo, with a per capita of only $ 342.
It is Qatar’s gas supplies that have made it the largest gas exporter in the world, surpassing the likes of Russia, even though its resources of 25 trillion cubic metres are only the world’s third largest after those of Russia and Iran.
The high LNG exports have boosted Qatar’s income, which is also supported by crude oil sales, and allowed it to record one of the highest growth rates.
“Interestingly, Qatar is the only country from the Arab region that is included in the top ten world’s richest nations” Global Finance said.
The report showed the other countries in the 10 richest nations, include by order of their wealth, Luxembourg, Norway, Singapore, oil-rich Brunei, the United States, Hong Kong, Switzerland, Netherlands and Australia.
The remaining Arab nations were ranked as follows: Bahrain (33), Oman (36), Saudi Arabia (38), Lebanon (54), Libya (57), Tunisia (89), Algeria (98), Egypt (104), Jordan (107), Syria (111), Morocco (117), Iraq (124), Yemen (136), Djibouti (137), Sudan (138), Mauritania (145) and Comoros (166).
This week Mena Private Equity Association released the first collaborative Venture Capital report for the MENA region. It stated that, during the last two years, the number of venture capital deals have increased three-fold.
According to the report, the total number of deals increased from 7 and 5 in 2007 and 2008 to 19 and 14 in 2009 and 2010 respectively. This marked a 175% increase in the entry deal activity of this industry over the past two years.
As a result, the industry raised USD 300 million in 2010 representing 28.4% of the total aggregated funds raised since 2000, and a 39.8% increase in cumulative funds raised since 2006. This increase was also reflected in the annual fund raising activity with 2010 marking a record year in the fund raising activity. It broke the previous record of USD 133 million in 2006, by an increase of 165%.
Speaking to Zawya, Tom Speechley of Riyada Enterprise Development, said,
“Venture Capital and Growth Equity are at an inflexion point in MENA. Demographic shifts and a new entrepreneurial era are providing investors with opportunities to make exceptional returns. Growth also ensures positive impact in society. Our industry is faced with both opportunity and the need for responsibility in equal measure.”
The report was compiled from the combined snapshots of MENA Venture Capital firms across the region. While the reputation of the industry is growing, Venture Capital executives have been eager to point out that the momentum has stopped. A long-term venture capital strategy must be established in order to benefit from the long term macro-fundamentals and growth opportunities.
View the full Venture Capital report.
