Emerging Markets Roundup: Middle East

UAE AND QATAR REMAIN FRONTIER MARKETS, MSCI SAYS

 

By Gordon Platt

 

Qatar and the United Arab Emirates will have to wait at least six more months before index provider MSCI will consider upgrading them to emerging markets from frontier markets. 

 

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A road less traveled: UAE and Qatar do not reach emerging markets status

Photo Credits: Oleg Znamenskiy / Shutterstock.com

MSCI cited Qatar's 25% foreign ownership limit and the UAE's system of handling failed trades as reasons for not upgrading the countries in December 2011. Under the UAE's framework a forced sale of assets could occur without the owner's consent when failed trades happen.

 

"Any change in the status of the MSCI Qatar Index is conditional upon a meaningful increase of foreign ownership limit levels applied to Qatari companies," MSCI says. Its next announcement on country classification decisions is scheduled for June 2012. The MSCI indexes have an estimated $7 trillion benchmarked to them worldwide.

 

Meanwhile, state-run Qatar Petroleum in December raised the Middle East's biggest syndicated loan of 2011, a $7.2 billion loan for the Barzan Gas project. The $10.4 billion project, designed to produce gas for domestic consumption, is 7% owned by Exxon Mobil, which provided a portion of the senior debt. The Royal Bank of Scotland is the project's financial adviser.

 

In the UAE, oil-rich Abu Dhabi tossed a $4.6 billion lifeline to indebted Aldar Properties, a real estate developer partly owned by the government. Abu Dhabi has purchased 760 housing units in Aldar's Al Raha Beach project, and assets in its Central Market project, in addition to forgiving a $1.4 billion infrastructure loan to Aldar. Last year the developer sold its Ferrari World theme park and the Yas Marina Formula One circuit to Abu Dhabi.

 

Saudi Arabian billionaire prince Alwaleed bin Talal will move his Rotana entertainment company and a new Arabic television channel, Al Arab TV, to Bahrain's new Media City, according to Bahrain's Information Affairs Authority. Alwaleed's Kingdom Holding and US business service Bloomberg plan to launch Al Arab in December 2012. The prince has also made a $300 million investment in social media site Twitter, which was a key source of information for protesters during the Arab Spring uprisings. 

 

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