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Gulf Financial Insider


January 2014 more inside...


Interview with Muna Al Hashemi

Batelco’s General Manager – Consumer Division 60. Motoring

BMW M6 Gran Coupe

16-26 Bahrain’s Aviation Industry

36 Finance

Special Feature

Global Economic Outlook 2014



Manama Dialogue

GCC Market Surge





Bahrain 2014

Global Trends

Finance Report

Real Estate 62. Men’s Fashion

Salsa Fall Winter 13 / 14



Invest in Bahrain forum


48. Hospitality

Ian Walker

MeetUp Bahrain Photography Finalists


Oberoi, Dubai

64. Art

The Arabian Review Publisher & Editor in Chief Nick Cooksey


Assistant Editor Melissa Nazareth Layout Designs Dhanraj S

Why you need a plan for 2014

Admin & Finance Nikesh Pola

Most people don’t make New Year resolutions because experience tells them they never work out. But often this is simply because they lack a plan.

Business Development Manager Redia Castillo

Planning is really just a process of deciding what you most want and laying out specific steps to achieving it. A good plan will tell you what to say “no” to as well as what to say “yes” to, and eliminate wasted time on low-value tasks.

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If you ever wonder if you’re making the “right” decisions on a daily basis, you need a plan. It will allow you to prioritize your day. If you find yourself feeling overwhelmed, you need a plan. It will inspire and reenergize you each day - you have a step-by-step guide to tell you what to do and when. Each day you will have a short, focused task list that drives the results you want in the short- and long-term. When the list is done, so are you. You can go home each day relaxed. You can engage with your family and not think incessantly about work. The good news is that planning can be amazingly simple. You can even do it on one sheet of paper!

Editorial Contributor Nicholas Cortes Con Coughlin

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We wish our Gulf Insider readers a successful, happy, and prosperous 2014. A Division of C.G. Arabia W.L.L. P.O. Box 26810, Kingdom of Bahrain Tel: +973 1700 4575 Fax: +973 1772 1722 Off No. 52, Floor No. 5, Building No. 741, Road No. 3616, Block No. 436, DCR Business Centre in Seef District

The multi-award winning Arabian magazine

The Arabian Review

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Manama Dialogue

REAL ESTATE 2014 Trends


2014 Outlook

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In you Last Word column, last month you mentioned that the need to be rich is something you must avoid if you want to be happy. What rubbish! Probably it’s easy for you to say that because you have all the money and comforts of life. There are poor people who go through so much pain and sadness because they don’t have money; because they can’t afford the basic necessities of life. What have you to say to that? May be you need to revisit Abraham Maslow’s hierarchy of needs! Scrooge


Dear Editor, I’ve noticed that Gulf Insider has a really nice car section. The quality of editorial content in this section, like in most sections of your magazine is commendable. I’m a freelance motoring journalist and would love to contribute articles for your magazine by way of car reviews and other motorsport news. Please do let me know how we can take this forward. Ms Wheeler

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I loved the EDB advertisement on the back cover of your last issue. Having been a copywriter all my life, I’ve worked with some of the best, creative people in the advertising industry. A striking ad artwork just takes the publication to another level. The ads must speak to your readers. Well done!

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Gold Digger

In your comments section it was mentioned about how conventional wisdom says that gold as an investment may be finished due to the falling dollar. It’s quiet surprising actually because even today when you enter the gold shops at Manama souq you don’t know what to buy; everything is so expensive. Well, I’m hoping that conventional wisdom stands true because for a woman gold can never be a finished investment! Lakshmi

Bureaucracy; The ‘Bigger Picture’


The West’s Delusion

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Saudi’s construction sector for year is booming

Abu Dhabi Report Average rents for light industrial facilities across the main Abu Dhabi areas rose off the back of strong demand during 2013 according to a report released by Knight Frank. Rental values in Mussafah and ICAD led the way with year-on-year increases of 5% and 10% respectively. This year’s opening of Khalifa Port and Kizad has further progressed Abu Dhabi’s position as a transport and industrial hub. What’s more, in December 2013, Kizad is set to deliver the first tranche of pre-built warehouses. Tenant demand for this stock rose steadily over the past 8 months, and intensified during October and November and is now over 60% pre-let. New occupiers such as Spinneys, Al Dhahira and Brazil Foods have all signed Mussatah land leases at Kizad this year, will all investing heavily in the construction of logistics and production facilities. The announcement of the new in field terminal at Abu Dhabi Airport also added positive sentiment to the market, which was further strengthened by FedEx Express opening its 31,000 sq.ft. airport facility. Other logistics occupiers signing new leases at Abu Dhabi’s Skycity were CEVA Logistics and Agility. – KNIGHT FRANK

Yemen looks to become GCC member Yemen is looking to become the GCC’S latest member, Foreign Minister Abu Bakr al-Kurbi said, adding that Sana’a has widely benefited from taking part on the sidelines of Gulf summits for the past seven years. Speaking during the annual Manama Dialogue, a regional security summit in the Bahraini capital, Kurbi said the Yemeni government would leave the decision on their inclusion in the bloc to GCC officials. The foreign minister also said that Yemen has laid out a number of risks and security concerns facing the country, which include the flow of refugees from the Horn of Africa and al-Qaeda’s infiltration in the country - ASHARQ AL-AWSAT


Gulf Insider January 2014

A study by Riyadh-based Jadwa Investment has revealed Saudi Arabia’s construction sector is the best performing GDP component for the year. The construction sector, one of the largest contributors to the Kingdom’s non-hydrocarbon GDP, grew by around 5.7% year-on-year in Q3, although down from 6.5% in Q2 2013 but higher than the 4.9% growth in Q3 of 2012, the study said. The sector also recorded the highest growth among GDP sectors, with the rate being nearly double the overall 3% growth in GDP. “Slower growth in the construction sector compared with the previous quarter may reflect the combined effect of the recent changes and enforcement of labor market regulations, as well as slower construction activity during the summer months,” Jadwa said, referring to the recent departure expat workers from the Kingdom under a government crackdown. “We, however, expect the impact of changes and enforcement of labor market regulations to be temporary, as the sector adjusts to this new norm. On the upside, the construction sector will continue to benefit from vast activity in building infrastructure, commercial and residential projects.” A breakdown of Q3 results also revealed that manufacturing, mining and quarrying including oil recorded the second highest year-on-year growth rate of 3.6% each. Citing government data, the report posted a 3.3% growth rate in the private sector, 3.2% in transport and communication, 3.1% in electricity, gas and water, 2.8% in personal services, 2.7% in trade and 2.3% in government services. – CONSTRUCTION WEEK

Business News

Retail boom in Middle Eastern markets Qatar, UAE and Saudi Arabia are leading the way for international retail expansion, according to EC Harris in its second annual global retail study. The Retail International Programme Expansion Index by the leading global built asset consultancy ranks 48 major retail markets according to five factors that have a major impact on successful retail expansion, including: quality of infrastructure; capability of the construction supply chain; legal framework; quality of project delivery and business environment. The Index sees Qatar, the UAE and Saudi Arabia all achieve high placement in this year’s rankings with Qatar, in particular, seeing great success in seventh place, building on the success of its 2012 ranking in 11th. The UAE has also moved up the rankings from 15th in 2012, to 11th, while Saudi Arabia is currently placed 13th. Due to a reputation for efficient project delivery and ease of transition, Middle Eastern markets are proving increasingly attractive to international retailers. This is set to continue and the future will no doubt see the market become a strong contender to the Western markets which currently remain the most desirable according to the Index, with the UK, Germany and the Netherlands topping the list. While many of the top ranking countries, including those in the Middle East, are those with established markets and a well-developed consumer base, those that rank lower include developing BRIC nations who pose greater risk and reputational damage to retailers. This is despite China’s emergence as one of the world’s largest consumer markets. The country remains around the midpoint of the Index in 23rd place, though above the other BRIC countries – Brazil, India and Russia. – CONSTRUCTION WEEK

2014 upturn in Kuwait projects market forecast Kuwait looks set to achieve a record breaking year in 2014 as far as contract awards are concerned. More than $24 billion in contracts could be awarded next year, double the value compared to the total this year. Many of the opportunities will be found in Kuwait’s oil and gas sector, with EPC bids due to be submitted over the next three months for the two largest projects – the estimated $16bn Clean Fuels Project (CFP) and the $7bn Lower Fars heavy oil scheme. “Oil and gas is not the only sectors of interest. Kuwait is embarking on one of the region’s most ambitious hospital expansion programmes as it seeks to double the number of beds over the next decade. In education, construction work is ongoing on the $3bn-plus Sabah al-Salem new university campus, which is one of the most modern and largest campuses in the world when it is completed,” said Edmund O’ Sullivan, chairman, MEED Events, organisers of Kuwait Projects 2013. Transport is another sector of focus. “Tenders will be issued soon for the long-awaited $3.2bn new Kuwait International Airport terminal, while there are long-term ambitions for a multi-billion-dollar rail and metro network,” O’ Sullivan added. - MEED

Gulf Insider January 2014


News Business

Saudi crackdown sees over 70,000 expats removed According to figures disclosed by the General Directorate of Passport, 71,118 expatriates have been removed from the Gulf kingdom so far due to irregularities in their visa status. The deportations are part of a crackdown on illegal workers in the world’s largest oil producer, where for decades authorities had turned a blind eye to the matter. In a sudden announcement this summer, Saudi authorities gave a deadline for all resident foreign nationals to either get their paperwork in order or leave the country. Saudi Arabia’s punitive sponsorship system has historically been rife with abuse, with numerous reports of citizens setting up bogus companies in order to sell visas to foreign workers on the black market. The campaign to reduce the kingdom’s reliance on overseas labour, which accounts for about one-third of the country’s population of 22m, is part of a broader strategy to provide more jobs for Saudi citizens. The official unemployment rate among Saudi nationals is put at 12%, but is probably significantly higher. – CONSTRUCTION WEEK

Middle East to have 300 Skyscrapers by 2015 Skyscraper construction is booming across the Middle East, with the region projected to have nearly 300 skyscrapers of at least 150 metres tall by 2015, according to the recent study “The Middle East: 20 Years of Building Skyscrapers” from the Council on Tall Buildings and Urban Habitat (CTBUH). The stunning growth of skyscrapers in the Middle East – from only two 150-metre skyscrapers in 1995, to 289 by 2015 – will be led by the UAE, which is projected to have 192 buildings (66 percent) of the total in 2015. The majority of the region’s skyscrapers will be in Dubai and Abu Dhabi, followed by Qatar, the Kingdom of Saudi Arabia, Kuwait, and Bahrain, according to the CTBUH. The Burj Khalifa in Dubai, the world’s tallest tower, is 828 metres. - CTBUH


Gulf Insider January 2014

Final Iran deal needs to balance out the concessions THE FACT sheet distributed by the Obama administration about the nuclear agreement with Iran is notable for its omissions. The 2,000-word document, like President Obama’s televised statement about the deal, stresses Iran’s pledge to cap its enrichment of uranium, delay the completion of a plutonium-producing reactor and accept additional inspections — measures that will guard against an attempt to produce a bomb while negotiations continue. What the White House didn’t report is that the text of the accord makes several major concessions to Tehran on the terms of a planned second-stage agreement. Though White House officials and Secretary of State John F. Kerry repeatedly said that Iran’s assertion of a “right to enrich” uranium would not be recognized in an interim deal, the text says the “comprehensive solution” will “involve a mutually defined enrichment program with mutually agreed parameters.” In other words, the United States and its partners have already agreed that Iranian enrichment activity will continue indefinitely. In contrast, a long-standing U.S. demand that an underground enrichment facility be closed is not mentioned. The most troubling part of the document provides for what amounts to a sunset clause in the comprehensive agreement. It says the final deal will “have a specified long-term duration to be agreed upon,” and that once that time period is complete, “the Iranian nuclear program will be treated in the same manner as that of any non-nuclear weapon state party” to the Non-Proliferation Treaty. Iran thus could look forward to a time when there would be no sanctions and no special restrictions on its nuclear capacity; it could install an unlimited number of centrifuges and produce plutonium without violating any international accord. Administration officials say they regard Iran’s agreement to the words “long-term” in the sunset clause as a significant concession. In theory, this might mean 15 to 20 years. Iran, however, has proposed a far shorter period; we are told it was three to five years. The interim arrangement, as we have said, is worthy because it checks Iran’s progress toward a bomb and is far preferable to the military action that otherwise might have been necessary. But the agreement leaves the United States and its partners at a disadvantage in negotiating the comprehensive settlement. The concessions made to Iran will have to be balanced by a major rollback of Iran’s nuclear infrastructure — with no automatic expiration date. – WASHINGTON POST

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Frequent kidnappings in Yemen ‘all about the money,’ experts say Assailants in Yemen attempted to capture a Japanese diplomat, stabbing him repeatedly when he fought back. The kidnap of foreigners and wealthy local businessmen in Yemen is largely a commercial activity, somewhat devoid of political or terrorist ambitions, experts say. Abductions are also a method of numerous tribes pressuring the country’s weak government into funding roads and other infrastructural projects, according to an October report in the Yemen Times. Another “less innocent” model of kidnapping involves the selling of abducted foreigners to al-Qaeda, which then demands a far larger ransom, the report adds. More than 200 people have been kidnapped in the country in the last 15 years, most of them later released unharmed, according to Agence France-Presse. Most of these kidnappings are purely for profit rather than political reasons, said Mustapha Noman, Yemen’s ambassador to Spain. “I don’t think there’s a political motivation behind the kidnappings… It’s just a lucrative job. if a gang can kidnap and make money, why not?” Noman told Al Arabiya News. Sanaa is attempting to restore law and order to the impoverished nation since former President Ali Abdullah Saleh stepped aside in late 2011 following mass protests against his 22-year-rule. The strongman’s exit from power has gutted the country’s security situation, leaving a ripe environment for tribes and gangs to conduct kidnappings at will. “During the last two years, there has been a dismantling of all of the security forces and the army because of the rivalries that have arisen over the past two years,” said Noman. The aftermath of Saleh’s exit from power has led some to wish for his return, Noman added. “People expected things to get better, not to get worse, and unfortunately we’ve seen an increase in the number of kidnappings, killings, robberies,” he said. – AL ARABIYA

Qatar clamps down on hotel alcohol sales Authorities in Qatar issued a written notice to hotel managers banning the sale of alcohol in swimming pool areas or on the beach, leading to the last minute cancellation of some beach parties around the capital Doha, it was reported. The Four Seasons, St. Regis and the Ritz Carlton hotels all cancelled their beach parties at the weekend as a result of the notice, Doha News confirmed. Officials have not yet commented on whether the new notice is a new regulation or the reinforcement of an existing rule, the report added. It is not the first time Qatar has moved to clampdown on the sale of alcohol. In December 2011 a controversial ban on alcohol at Qatar’s manmade Pearl-Qatar development led to the closure of several high profile restaurants. In January, celebrity UK chef Gordon Ramsay weighed in on the row, which led to the closure of his Maze restaurant in March 2012 after just two years of operation. “I think the legislation in terms of operating restraints going out for dinner and not being allowed to have a glass of wine - I think it’s one turn-off for any local,” Ramsay was quoted as saying by Doha News. - HOTELIER

Dubai residents worried about rising property prices Property prices in Dubai have been on the rise over the past 12 months and Dubai residents are concerned that, if rents continue to surge, the majority of them will be forced to relocate to cheaper areas in the Emirate or abroad. According to a new survey by research firm YouGov, 28 per cent of respondents in Dubai said that if rents continue to increase over the next 12 months, they will move out of the UAE, while 15 per cent said they would be forced to relocate to another emirate. Sixty five per cent of participants revealed that their rent has increased over the past 12 months and 35 per cent said that the hike was between five per cent to nine per cent. When asked how property prices in Dubai have changed over the past year, 92 per cent said that they have increased. While real estate experts, reports and giant billboards have continued to reassure the public that the resurgence in Dubai’s real estate market is real and sustainable, a whopping 84 per cent of residents believe that the property market will go through another boom-and-bust cycle. According to a report on Friday, December 6, by Knight Frank, house prices in Dubai rose by 28.5 per cent in the first nine months of the year – the biggest increase in any of the global markets that the real estate agent tracks.- KIPP REPORT 12

Gulf Insider January 2014

Business News

Journalists skeptical about Muslim Brotherhood TV station launched from Turkey Rabaa TV is named after Rabaa al-Adawiya square in Cairo, where a sit-in by supporters of ousted President Mohammad Mursi was forcibly cleared in August. The station’s goal is to become a “platform for freedom” that will be “focused on political issues in the Muslim world,” the Brotherhood’s Freedom and Justice newspaper reported, adding that the channel will be available on Egypt’s Nile Sat. Former Brotherhood member Kamal al-Helbawy told Al Arabia News that the launch will only add to the group’s failures, and that it is fighting a losing battle. Abdallah Kamal, an Egyptian journalist and political analyst, said the station would not succeed due to the demise of other Islamist channels, as well as the lack of wellknown and professional media personalities. “The Brotherhood’s rhetoric is provocative, and has nothing to do with the professionalism required for TV. It isn’t offering any political solution to gain back public support or to help rethink its failure in politics,” Kamal told Al Arabiya News. The launch is an indicator that al-Jazeera, which many accuse of being the Brotherhood’s mouthpiece, is no longer “enough for them to express their views,” he added. “The Brotherhood is trying to increase media pressure in Egypt... especially since European and American papers no longer publish stories on it, and its PR ads and campaigns aren’t effective like they used to be,” Kamal said.- AL ARABIYA NEWS

Saudi passes anti-terror law, banning defamation Saudi Arabia’s Cabinet has approved a new anti-terrorism draft law that criminalizes acts that disturb public order, defame the reputation of the state or threaten the kingdom’s unity. A rights activist and a rights lawyer decreed the law as too broad, saying that besides terrorists, it could be used to target civil society activists calling for democratic reforms. They spoke anonymously for fear of retribution. The Saudi Council of Ministers is comprised of nearly two dozen members all appointed by King Abdullah. The meeting was chaired by his likely successor, Crown Prince Salman, who is also deputy premier and the defense minister. Any legislation approved by the council must be ratified by the king. State-owned Saudi media released details of the law online after the Cabinet meeting. - AFP

Dubai alcohol law needs overhaul, says top lawyer A leading Emirati lawyer has called for an overhaul of Dubai’s alcohol laws, saying tourists were unwittingly breaking the law while on holidays and they should be able to get an alcohol licence along with their visa on arrival. Under local law, alcohol consumption is only permitted in designated areas such as bars attached to hotels. Tourists and residents can drink in these locations without holding a licence to buy alcohol. However, once outside the permitted area they can be arrested if brought to the attention of police if they are found to be drunk and disorderly in a public area or drink-driving. Al Baher said residents were made aware of the need to obtain an alcohol licence, but tourists may not realise they also technically needed one. However, he said given the application process involved – with applicants required to prove they are non-Muslim, aged 21 or older and earning more than AED3,000 ($817) per month – it was impossible for tourists to obtain a licence. “Why don’t we give them temporary [alcohol] cards for all visitors,” he said. Al Baher said the idea had come up among lawyers who had dealt with a lot of cases involving illegal drinking and it had been shared with people higher up. Al Baher said it was up to the government how it wanted to handle the issue, but he believed it needed to do something. - HOTELIER

Gulf Insider January 2014


Batelco Interview


TALKS ABOUT HER CAREER WITH BATELCO Batelco General Manager Consumer Division Muna Al Hashemi


Gulf Insider January 2014

Interview Batelco


ou have been with Batelco since 1994. What is it about the company and your experience there that has caused you to stay so long? Working in a telecom operator was always my dream and I found that Batelco has a unique culture. Batelco inspires people to do their best work, motivates them to stay with the company, and causes them to promote the company to their friends, family, and customers. It has created an environment in which employees’ needs are met, and employees are more engaged. Tell us about your professional progression: where did you go to college, first job, how have you moved through the ranks at Batelco? I have graduated with a Master’s degree in Telecommunications and a BSc in Electronic Engineering. I began my career in the Engineering Department and gained invaluable experience as I have progressed through a number of divisions, including Customer Services, Accounts management, Product Marketing, Product Development and Customer Marketing. The depth of knowledge of various functional units and processes I gained has prepared me for my current challenging task of heading up the busy Consumer Division, responsible for the contact centre, product development and management, retail outlets, direct and indirect distribution channel, segment management, market communication and brands. What motivates you to do what you do? What part of your job are you most excited and passionate about? The passion! It’s very important to know yourself. Everyone has things that bring them up and things that bring them down. If you focus on the things that bring you down, you’ll be unhappy. If you engage the stuff that brings you up, you’ll not only be happier, you’ll get more business because you’ll really be doing what you love. Passion Makes Perfect. When the passion drives you, you will find that everything comes easier, targets are achieved faster, and the bottom line improves dramatically.

I am very passionate about the dynamic change that we have in the telecom industry, about the ongoing development of technology, and about the ongoing challenges to meet the customer demand.

leadership, build the strongest team you can, maintain a servant’s heart, learn to communicate and never stop growing & dreaming.

I am very passionate about the dynamic change that we have in the telecom industry and about the ongoing development of technology.

What do you consider to be your major achievements, both personally and professionally? The journey is very long and I can guarantee you that in every milestone of my journey there were a couple of achievements that have made me proud. For example, leading the commercial launch of the 3.5G mobile service, leading the commercial launch of the 4GLTE mobile service, as well as leading the fastest Fiber commercial launch for the consumer 100Mbp. I have also been involved in transforming our call centre into a state of the art contact centre, among other achievements. What is the best piece of business advice you have ever received? Decide what you believe about

What are your short and long term goals in your position at Batelco? The sky is the limit. In your opinion, what makes Batelco stand out from its competitors? The quality of products & services that Batelco offers, as well as its customer service and relationship to the customers are what makes us unique from the others. Can you let us in on what Batelco has planned for 2014? Batelco will continuously invest in delighting our customers and elevating our customer relationship. We will also invest heavily in bringing the latest technology and service to our customers. GFI

Gulf Insider January 2014


Bahrain Aviation Industry


BAHRAIN’S AVIATION INDUSTRY A golden past and a bright future.


Gulf Insider January 2014

Aviation Industry Bahrain


ahrain’s aviation history began in 1920 when ruler Shaikh Isa bin Ali Al Khalifa first gave permission for the British to establish an airfield here. The first plane landed in Bahrain on the 8th of June 1924, amid regional tensions, with the Persians suspicious of Britain’s ambitions in the region. According to a book by aviation expert David Watts, former Middle East correspondent for The Times, the first civilian flight to Bahrain landed in August 1927. It was an Imperial Airways (the forerunner of British Airways) flight from Basra, Iraq, chartered by a Gulf pearl merchant. At the time, Shaikh Hamad’s palace in Gudaibiya was used as a beacon to guide aircraft to a landing strip nearby. In 1932, the first commercial flight, also an Imperial Airways plane, overshot the runway in Gudaibiya, ended up in a water channel, and had to be hauled out of the sand by several hundred Bahrainis. After this incident, the new airport in Muharraq became the preferred choice for pilots. A service from London to Delhi, operated on a Handley Page H.P.42 aircraft named “Hannibal”, made a stop in Bahrain. It carried only 24 passengers and took several days to make the journey at a leisurely flying speed of 100 miles per hour, but it was this regularly scheduled service that established Bahrain as the Arabian Gulf’s first international airport. There was also a “Bahrein” Marine Airport (the spelling of Bahrain had yet to be standardised) on the Manama coast between Mina Salman and the Marina Club, where the Short Brothers S23 planes docked. These “flying boats”, as they were affectionately called, were passenger aircraft that landed on water. They eventually gave way to the enormous Empire seaplanes, until they fell out of fashion altogether in the 1950s. 1950 was an important year for Bahrain as it saw the birth of a new local airline. Gulf Aviation Company, the forerunner of Gulf Air, was established by an enterprising former RAF pilot named Freddie Bosworth. Starting with just one aircraft, a second-hand Anson Mark II, it was established as a commuter service for those working in Doha and Dhahran. Bahrain International Airport was easily the most modern and advanced

airport in the region, with a good runway, control tower, lighting, communication facilities, and even restaurants. It began to attract to attract other carriers such as Middle East Airlines, Air India, Air Ceylon and Iran Air, and the terminal had to be expanded in 1971 to accommodate the increased traffic. In 1976, the airport marked another significant first with the inauguration of supersonic flights, which saw a regular British Airways Concorde service between London and Bahrain. In the 1980s and 1990s, major facelifts took place and in 1994 a US$ 100 million terminal was inaugurated. The government recently announced a major expansion of the airport to increase its passenger handling capacity from 9 million to 13.5 million. It will feature around five additional contact gates, nine remote gates, 40 new check in counters and a large transfer facility, among others. A new airport is also on

1950 was an important year for Bahrain as it saw the birth of a new local airline. the way. Work was scheduled to begin in 2011 but was pushed back due to several issues, including Gulf Air’s threeyear restructuring programme. There are plans to eventually integrate the airport with other transport infrastructure, such as a light rail network. In 1974 the Gulf Aviation Company evolved into Gulf Air, the Middle East’s largest and most important carrier,its shareholders, the governments of Bahrain, Qatar, Abu Dhabi, and Oman, opened up the region to the world.. Once Etihad, Qatar Airways, and Oman Air were launched, Bahrain was left as the sole owner in November 2007. . The “Arab Spring” meant profitable routes to Iran and Iraq were axed due to political tensions. Between 2008 and 2013 Gulf Air faced competition even at home from the privately owned Bahrain Air.

Established as a budget airline in 2008, Bahrain Air operated services to a dozen destinations in the Middle East and the subcontinent, but struggled to compete with Gulf Air and other low-cost airlines in the region such as Air Arabia and Flydubai. In February 2013 it filed for voluntary dissolution. Following the appointment of a new Board of Directors in November 2012, the Gulf Air management have been working on a balanced restructuring strategy to reduce its losses and better serve its customers. The airline rolled out a threeyear plan that includes realigning its network, streamlining and modernising its fleet, and downsizing its workforce to build a financially stronger airline.

Gulf Air through the years March 1950: Gulf Aviation Company was registered as a private shareholding company, making it one of the oldest carriers in the Middle East. 1951: With a 22% stake, British Overseas Airways Corporation (BOAC) became a major shareholder in Gulf Aviation. 1973: Abu Dhabi, Bahrain, Oman, and Qatar governments purchase BOAC’s shares. 1974: The Foundation Treaty is signed on the 1st of January, turning the Gulf Aviation Company into Gulf Air. 1981: Gulf Air becomes a member of the IATA. 1990: Gulf Air becomes the first Arab airline to fly to Australia. 2000: The airline celebrates its 50th anniversary. 2002: Qatar withdraws from Gulf Air. 2005: The Emirate of Abu Dhabi decides to withdraw from Gulf Air and establish its own airline, Etihad Airways. May 2007: Oman withdraws from Gulf Air. The airline is now fully owned by Bahrain. GFI

Gulf Insider January 2014


Bahrain Aviation Industry




IR INDIA, National carrier of INDIA operates daily to DELHI departing from BAHRAIN at 20:45 Hrs and arrives at 05:20 Hrs. On the return flight departs from Delhi at 18:15 Hrs in the evening and arrives in Bahrain at 19:45 Hrs. AIRINDIA’s add-on fares for passengers travelling onward from Delhi have become extremely popular among the passengers and we are proposing to deploy a bigger aircraft for the Bahrain Delhi sector. A passenger travelling beyond Delhi on AI 940 flight has to pay an additional of BD05 ( one way ) only and almost the same fare for return for travelling to places like Amritsar,

Lucknow, Patna, Hyderabad, Chennai ,Jaipur ,Kolkata ,Chandigarh etc. AIRINDIA EXPRESS, a subsidiary of AIR INDIA operates daily flights between Bahrain and Kozhikode/Kochi and twice weekly to Mangalore on Wednesdays and Saturdays. Flight IX474 leaves Bahrain at 18:40 hrs and arrive Calicut at 03:20 hrs. In the return direction, flight IX 473 Calicut-Bahrain leaving Calicut at 15:50 hrs and arriving Bahrain at 17:40 hrs. The fares are very competitive and start at BD68 OW, inclusive of taxes.

Operates to Kozhikode/Kochi/Mangalore/Delhi Air India offers convenient connections to many destinations over Delhi Fares Starting From BHD 65 (Ow) & BHD 125(Rt) for Delhi and Add On Fare of BHD 05(Ow)/10(Rt) For Onward Sectors. 18

Gulf Insider January 2014

Bahrain –Cochin – Bahrain daily flight IX 474 leaves Bahrain at 18:40 hrs and arrives Cochin at 05:10 and IX 473 departs Cochin at 14:05, and arrives Bahrain at 17:40 hrs. For the Bahrain Mangalore Bahrain sector, there will twice a week direct flights on Wednesdays and Saturdays. IX 820 departs Bahrain at 12:45 hrs and arrive Mangalore at 19:15 hrs. In the return direction IX 819 departs Mangalore at 10:05 hrs and arrive Bahrain at 11:55 hrs. GFI

DEP Bahrain 2045 hrs and ARR Delhi 0520 hrs Connects to








































ubai, the regional hub for hospitality, tourism and shopping has often been ranked a top 10 global destination for business, leisure and shopping tourists. Not only that, the Emirate is estimated to accommodate over 200 global nationalities – making it a truly international metropolis and one of the world’s most sought-after destinations for visitors. Boasting one of the world’s only 7 star hotels, the world’s tallest tower, the first indoor ski resort in the Middle East, the much-acclaimed Palm Island and the world’s largest dancing fountain, to name a few of the Emirate’s unique attractions, Dubai is truly a place of pioneering growth and global firsts. In late 2013 Dubai celebrated two significant milestones: inaugurating what is slated to be the world’s largest and busiest airport and successfully bidding to host the World Expo 2020. The new, multi-billion dollar passenger terminal at Dubai World Central (DWC) Al Maktoum International Airport was officially unveiled on 26th October 2013. With an anticipated two million travellers travelling through the passenger terminal at Al Maktoum International Airport by 2014, and up to 30 million by 2023, Al Maktoum International Airport is catering for the rapidly growing residential, tourist, leisure and business activities in the area.

The airport will, upon final completion, have five runways with world-leading facilities and the ability to handle 160 million passengers per annum and 12 million tonnes of freight. The airport is located close to the holiday, residential and business developments of Arabian Ranches, Dubai Marina, Dubai Media City and Palm Jumeirah, making it an attractive, alternative, time-saving travel proposition for passengers located in or travelling to these areas. National carrier of Bahrain, Gulf Air’s new daily evening service to Al Maktoum International Airport serves those travellers who value the new airport’s convenience and proximity to new Dubai. The airline is operating its new A320 aircraft, equipped with the latest in-flight entertainment technology, on all flights between Bahrain International Airport and Al Maktoum International. With much to see and experience in Dubai (including the Emirate’s upcoming preparations for the highly-anticipated World Expo 2020) and multiple travel

Al Maktoum International Airport is expected to receive two million travellers by 2014 and up to 30 million by 2023. options to get there – there’s little doubt that visitor traffic to the Emirate will continue to grow. And Dubai is ready. The UAE’s thriving hospitality industry sees it ranking among the top five countries in the world for new hotel openings over the past five years. With 32,107 rooms currently under construction in the UAE and an estimated 125,383 hotels rooms expected by 2016 – we are sure you’ll have a wealth of accommodation choices whenever you decide to visit. GFI

Gulf Insider January 2014



Aviation Industry Bahrain

Bahrain Aviation Industry



SPECIAL REPORT Bahrain International Airshow prepares for take off


he Bahrain International Air Show (BIAS) is a unique event in the region, and the 2014 edition will be the biggest one to date, offering a combination of exciting sights for families and aviation enthusiasts, and exclusive networking and investment opportunities for global and regional businesses. The Airshow offers an important platform for showcasing the strategically important aviation, transport and logistics sectors of the economy while more broadly highlighting the investment case for Bahrain and the wider region. It is also reflective of the development of important events and is driving and enabling growth in the Bahraini economy. For instance, the Bahrain Exhibition and Convention Authority (BECA) reported a 116 per cent increase in the number of exhibitions and conferences staged at the Bahrain International Exhibition and Convention Centre (BIEC), with 82 events in 2012 compared with 38 in 2011. Another key landmark event, which is now entering its second decade, is the Bahrain Grand Prix. Independent studies have shown the race has a direct economic impact of US$295 million and supports 3,000 jobs in the Kingdom. As with the Airshow, its indirect economic benefits are numerous. The positive


Gulf Insider January 2014

impact is felt across the country, by taxi drivers, hotels, restaurants, and other service sectors that benefit from the race. Far beyond the compelling direct economic case for it, the Bahrain International Airshow provides an important opportunity to showcase Bahrain at its best to the rest of the world. The Kingdom provides an excellent basis for investors looking to access the wider GCC region, offering them a unique value proposition built with a qualified workforce and a mature, well-established business environment.

The gateway to the Gulf Generally, transportation-related sectors have always played an instrumental role in driving growth and underpinning the competitiveness of Bahrain’s economy. As an island, Bahrain can take pride in a long history of economic openness and integration. Its ability to connect with other markets regionally and globally will inevitably remain at the core of its success. The Kingdom is strategically located on important trade routes in the northern Gulf and as a result, it has developed a sophisticated, modern infrastructure for channeling trade flows across the

region. In particular, Bahrain is uniquely positioned as the natural gateway to the GCC region. The Gulf is a sizeable economy – the six countries of the GCC now comprise a market worth $1.5 trillion. And it’s a market that the Economist Intelligence Unit has predicted will grow to $2 trillion by 2020. In 2012, Bahrain attracted $891m of FDI, a 14% increase on 2011. FDI inflows were equal to 3.4% of Bahrain’s nominal GDP, the highest percentage in the GCC. Highlighting the competitive business proposition in Bahrain, the most important element of FDI were reinvested profits by foreign companies active in Bahrain. Businesses operating in the Kingdom have achieved exceptional results. According to UNCTAD estimates, the rate of return to FDI in Bahrain stood at a remarkable 50% in 2012, which was the second highest rate in the world. The past two years have shown that Bahrain’s business fundamentals are strong and economic stability is secure. The Kingdom achieved overall GDP growth of 3.4% in 2012 and according to EDB estimates, overall growth in 2013 is expected to reach up to 5%.

EDB: driving FDI In order to maintain long-term growth

Aviation Industry Bahrain

There are many incentives for potential investors looking to set up in Bahrain, one of which is that Bahrain permits 100% foreign ownership of companies across all sectors. and opportunities for all Bahrainis, the government is committed to sustaining and strengthening the core business proposition which relies on a highly skilled workforce, competitive operating costs, stable and transparent regulation, an open business environment and sustainable growth. The Bahrain Economic Development Board (EDB) continues to drive FDI into Bahrain; and during 2013, we enjoyed some important milestones, with new businesses being established in the Kingdom across a range of different sectors, which has helped drive continued and stable economic growth. We also had some key economic and commercial events taking place, such as the Formula One and the annual

Spring of Culture. Furthermore, the EDB participated in roadshows to the USA, UK, Germany, India, China and Japan and led delegations to North America, Europe and Asia, for events such as the World Economic Forums and IMF / World Bank meeting.

Bahrain: open for business Similarly to the annual Formula 1 Race, the BIAS provides a platform for the EDB to re-engage with some of the potential investors, particularly from the aviation sector, that we may have met on our trips, as well as keeping Bahrain in the global spotlight and reminding people of the opportunity the Gulf region offers from an investment perspective.

There are many incentives for potential investors looking to set up in Bahrain, one of which is that Bahrain permits 100% foreign ownership of companies across all sectors. In other words, such benefits are not restricted to special jurisdictions or ‘free zones’ but apply throughout the economy and in the broader GCC region. Bahrain will continue to invest heavily in core infrastructure and strengthening the pan-GCC transport links, thereby maximizing the opportunities provided by its location and connectivity. The Kingdom already has a vibrant worldclass sea port, located close to the airport, which will be expanded. All this helps companies to easily move their goods and services across the GCC and beyond. GFI

Gulf Insider January 2014


Bahrain Aviation Industry



HE ENGINEER KAMAL BIN AHMED MOHAMMED Minister of Transportation and Chief Executive of the Bahrain Economic Development Board.

HE Engineer Kamal bin Ahmed Mohammed


ahrain hosted the first airport and the first airline in the Gulf, with a rich history of aviation. In your opinion, is that history still alive or does it need rejuvenation? How can that be achieved?

Bahrain has a proud history in the aviation industry, and we are proud to be able to continue to evolve this role in line with the global and regional industry dynamics. Our strengths, and offering for investors, in the aviation sector match the same pillars that help assure sustainable economic growth for the Kingdom: an open, liberal business environment, a skilled local force, competitive costs and a world-class transport infrastructure to support businesses requirements to access the growing GCC markets. By continuing to build on these, we


Gulf Insider January 2014

are confident that we will see continued growth and investment in the aviation industry in Bahrain.

Being the Minister of Transportation, Chief Executive of the EDB and Deputy Chairman of the Board of Directors of Gulf Air, you are highly involved in the aviation industry in Bahrain. What are your major goals and plans for this sector in the next 5 years? What challenges are you currently facing in regards to aviation in Bahrain? Our focus in Bahrain is ensuring that the Kingdom offers the optimal infrastructure and remains a strategically attractive place to access the $1.5 trillion Gulf market, and public sector investment in the aviation sector will be

targeted with this in mind. We already have a vibrant new port, located close to the airport, and we are moving forward with the wider GCC community in the development of a rail network. The planned airport modernisation project will mean that Bahrain offers integrated connectivity as a major transportation hub with the closest links between road, sea and aviation in the region. All this helps companies to easily move their goods and services across the GCC and beyond. The ongoing Gulf Air restructuring, which has been successfully implemented so far, is another important pillar in our strategy, and we are focused on positioning our national carrier as the most connected regional airline to help facilitate long-term sustainable growth of the economy. Furthermore, our new Civil Aviation Law, passed in 2013, will help ensure

Aviation Industry Bahrain

that the aviation sector in Bahrain incorporates global safety and security standards, making it even more attractive for investment in this industry.

Bahrain has a lot to compete with in the aviation sector, with other regional players often taking the front seat. Where does Bahrain stand out, in specific? We believe that growth in the region creates tremendous opportunities for Bahrain, because by attracting international visitors and investment, Bahrain can play to its strengths as a regional hub. Growing demand for access to the region also means that passenger numbers are growing: 8.5 million people travelled through Bahrain International Airport in 2012, 8.8% more than in 2011. The airport has won numerous awards and we hope to build on these successes.

The Bahrain International Airshow was said to be a success in 2012. What are your projections for the BIA this year? Do you think it will grow? How do you estimate that it will impact the economy? How will you judge the success of BIA 2014 in comparison to 2012? The Bahrain International Airshow 2014, which is organised under the patronage and close supervision of HM the King’s Personal Representative and Head of the Supreme Organising Committee of Bahrain International Airshow, HH Shaikh Abdullah bin Hamad Al Khalifa, continues to build on the success of previous events and will be the biggest edition yet. It is expected to be attended by 20,000 trade visitors, including around 120 companies and governmental, military and civil delegations, from over 25 countries, representing most of the key global markets. The decision to host an Airshow comes as a result of a directive from HM the King to develop globally relevant

events that act as a platform for the Kingdom to showcase its economy, and the significant level of support and attendance reflects the approach and offering it presents.

What will be the principle highlights of this year’s airshow? We are excited about the strong support we have enjoyed from our regional neighbours. A major delegation from the Kingdom of Saudi Arabia will be present, as well as strong Turkish participation, with eight aerospace businesses from the country in attendance, as the Airshow grows in significance on the international calendar. In addition, running alongside the Airshow will be GREAT British Week, exhibiting Britain’s tradition of worldclass engineering and technology skills with companies such as Rolls-Royce and BAE Systems involved.

The Airshow acts as a platform to showcase Bahrain’s unparalleled regional connectivity as a major transportation hub. BIAS 2014 is also set to offer its public visitors a festival of fun including daily flying displays of up to 4 hours and a host of on-ground attractions, dining options and entertainment. Confirmed display teams include the Hawks from Saudi Arabia, the UAE’s Al Fursan, the Russian Knights and the Breitling Wingwalkers, and the historic Spitfire fighter aircraft will also be making a special appearance. There will also be solo aerobatics from Mark Jefferies, the Red Devils parachute display team and the SWIP Twister display team with their amazing nighttime display.

What are the direct and indirect benefits to Bahrain for hosting the airshow? Not only

immediate benefits, but long term? The Airshow acts as a platform to showcase Bahrain’s unparalleled regional connectivity as a major transportation hub, and this will provide long-term benefits to the economy. Transportation and communications already contributed around 7 per cent towards Bahrain’s GDP in 2012, and we expect this to continue to grow and help to create long-term, quality jobs for Bahrainis. In terms of the near-term benefits – with 20,000 trade visitors expected, as well as people attending the public event from around the region, the positive impact of the Airshow is felt across the country, not least from the hospitality and other service industries that benefit.

Why was it decided to commence having a bi-annual airshow in Bahrain and what were the goals of this endeavor when it was started? Has the airshow lived up to initial expectation and reached those goals in the last two years? Please elaborate. The Bahrain International Airshow is a commercially-focused event that draws on Bahrain’s strategic location at the heart of the Gulf, offering a five star service and a unique opportunity to do business. We developed it as an intimate gathering for senior industry players, and so the Airshow is primarily a networking event that establishes a platform for business that can be followed up at international airshows over the year ahead. The level of attendance as well as the repeat clients attending the show demonstrates the success of the event, and there is no doubt that we have achieved our goals of providing an important global and regional platform for the industry, whilst getting an opportunity to showcase to Bahrain to a broad range of international stakeholders. Having said that, there are always opportunities for improvement, and we will continue to look for ways to make the show more attractive for trade visitors and exhibitors as we go into the future. GFI Gulf Insider January 2014


Bahrain Aviation Industry




he International Air Transport Association (IATA) announced an upward revision to its industry financial outlook. For 2013 airlines are expected to return a global net profit of $12.9 billion. This is expected to improve to a net profit of $19.7 billion in 2014. Both are improvements on the September forecast which anticipated an industry net profit of $11.7 billion in 2013


Gulf Insider January 2014

increasing to $16.4 billion in 2014. The upward revision reflects lower jet fuel prices over the forecast period as well as improvements to the industry’s structure and efficiency already visible in quarterly results this year. Passenger markets continue to outperform the cargo business which remains stagnant both on volumes and revenues. The anticipated $19.7 billion profit

in 2014 would come on projected revenues of $743 billion. While this would be the largest absolute profit for the airline industry—outstripping the $19.2 billion net profit that the industry returned in 2010 - it is important to note that 2010 revenues were $579 billion. The net profit margin in 2010 was 3.3%, some 0.7 percentage points higher than the 2.6% expected for 2014.

Aviation Industry Bahrain

In 2014 we expect some 3.3 billion travelers and 52 million tonnes of cargo— increases of 64% and 37% respectively. “Overall, the industry’s fortunes are moving in the right direction. Jet fuel prices remain high, but below their 2012 peak. Passenger demand is expanding in the 5-6% range—in line with the historical trend. Efficiencies gained through mergers and joint ventures are delivering value to both passengers and shareholders. And product innovations are growing ancillary revenues,” said Tony Tyler, IATA’s Director General and CEO. “We must temper our optimism with an appropriate dose of caution. It’s a tough environment in which to run an airline. Competition is intense and yields are deteriorating. Cargo volumes haven’t grown since 2010 and cargo revenues are back at 2007 levels. The passenger business is expanding more robustly. Some airlines will out-perform our estimates and others will underperform. But, on average, airlines will only make a net profit of about $5.94 per passenger in 2014,” said Tyler. Passenger demand is robust and passenger numbers are expected to reach 3.1 billion in 2013 and rise by 6% to 3.3 billion in 2014. Nonetheless, competition remains intense and industry-wide average yields are expected to fall by 0.2% in 2013 and by 0.6% in 2014. Middle East airlines are expected to return a net profit of $1.6 billion in 2013, increasing to $2.4 billion in 2014. EBIT margins also continue to improve— from 3.8% in 2013 to 4.7% in 2014. The region’s hubs, particularly in the Gulf, continue to expand in support of growing long-haul connectivity. Strong oil revenues—as oil prices stay high— continue to support travel generated by domestic activity and the development of the tourist industry. The Syrian crisis has not impacted traffic beyond its borders. Airlines have made great strides at improving their businesses in the face of very adverse business conditions.

Where they have been able to improve the industry structure through mergers and joint ventures, consumers have benefitted with more efficient connectivity and this has translated to improved financial results. Fuel consumption provides a good example of the efficiencies that airlines are putting in place. In the face of rapidly rising fuel costs, airlines have dramatically improved fuel efficiency. In 2004 airlines transported two billion passengers and 38 million tonnes of cargo using 65 billion gallons of fuel. In 2014 we expect some 3.3 billion travelers and 52 million tonnes of cargo—increases of 64% and 37% respectively. Over the same period fuel uplift has grown by only 17% to 76 billion gallons. GFI

IATA expect to see a 31% increase in passenger numbers between 2012 and 2017. By 2017 total passenger numbers are expected to rise to 3.91 billion—an increase of 930 million passengers over the 2.98 billion carried in 2012. Of the new passengers, approximately 292 million will be carried on international routes and 638 million on domestic routes. The emerging economies of the Middle East and Asia-Pacific will see the strongest international passenger growth with CAGR of 6.3% and 5.7%, followed by Africa and Latin America with CAGR of 5.3% and 4.5%. Routes within or connected to China will be the single largest driver of growth, accounting for 24% of new passengers during the forecast period. Of the anticipated 227.4 million additional passengers, 195 million will be domestic and 32.4 million will be international.

Gulf Insider January 2014


Bahrain Aviation Industry



TURKISH AIRLINES Having bagged the CAPA Airline of the Year Award, this prominent brand in the aviation industry is set to contribute to a promising future for both the global airline sector and Bahrain.


urkish Airlines has been named the CAPA Airline of the Year at the 11th annual CAPA Aviation Awards for Excellence in Amsterdam. Dr Temel Kotil, President and CEO of Turkish Airlines, was presented the award by CAPA Executive Chairman, Peter Harbison at a gala ceremony. The CAPA Airline of the Year is awarded to the carrier that has had the greatest impact on the development of the airline industry, has established itself as a leader and has set a benchmark for others to follow. “Turkish Airlines has established itself as a formidable competitor in a geographic region that boasts many of the world’s leading airlines,” said Mr Harbison. “It has created the

This award encourages us to achieve and accomplish more and thus bring about more growth. world’s largest international network and now reaches nearly 200 destinations from its powerful hub in Istanbul. Under the strong and visionary leadership of its management and with the dedicated efforts of its employees, Turkish Airlines has forged an industry leading service culture, numerous innovative marketing campaigns and a consistently high quality product offering.” “Turkish Airlines has successfully exploited its geographic position with an innovative fleet deployment strategy and it has successfully leveraged membership in Star Alliance and a wide range of bilateral codeshare relationships to further extend its global reach. All this is generating healthy profitability and we


Gulf Insider January 2014

Dr Temel Kotil, President and CEO of Turkish Airlines receives the award.

wish Turkish Airlines even greater success in 2014.” Dr Temel Kotil expressed that he and his team are happy and proud to have won such a distinguished award – the CAPA Airline of the Year. “This award encourages us to achieve and accomplish more and thus bring about more growth,” he added. GFI

For further information visit or call on, Tel. +973 17516100

Europe’s Best Airline*

Bahrain Dialogue




t is now more than 40 years since the withdrawal of British forces located east of the Suez Canal. If few could dispute the economic imperative that necessitated a dramatic reduction in Britain’s global presence, the decision came as a particularly cruel blow to the Gulf Arabs, most of whom cherished their long-standing ties with Britain which, in many cases, dated back to the early 19th century. With London no longer able to protect them, the Americans quickly filled the void, and the arrival of the US 5th Fleet – which today has more warships than the entire Royal Navy – to take over the Bahrain naval base vacated by British forces in 1971 aptly symbolised Britain’s retreat from empire. Until recently, the Pax Americana has admirably served the Gulf region’s interests, whether protecting it from the threat posed by the Iraqi dictator Saddam Hussein or the more sinister designs of the ayatollahs menacing from the opposite shores of the Gulf. But, thanks to the Obama administration’s woeful disregard for the concerns of its erstwhile allies, the entire future of the Western alliance’s relationship with the Gulf region is now under threat. Looking back, the rot set in nearly three years ago, when President Barack Obama unwisely backed the overthrow of Hosni Mubarak, the ruler of Egypt, despite the fact that Mr Mubarak had


Gulf Insider January 2014

Dialogue Bahrain

been a staunch Western ally for more than three decades. If Mr Obama could blithely turn his back on a trusted ally such as the Egyptian president, then what guarantees did other pro-Western Arab regimes have that Washington would stand by them in their hour of need? More recently, last month’s interim agreement between the US and Tehran in Geneva over Iran’s controversial nuclear programme has exacerbated tensions further. The result is that many leading Arab states, such as Egypt and Saudi Arabia, are now seriously considering whether they should ditch their long-standing ties to Washington, and look elsewhere for more reliable allies, an opportunity Russia’s Vladimir Putin is only too eager to exploit. This deepening sense of betrayal by the Obama administration was very much in evidence at last month’s annual Manama Dialogue regional conference in Bahrain, which is organised by the London-based International Institute for Strategic Studies. Despite attempts by Chuck Hagel, the US defence secretary, and British Foreign secretary William Hague to reassure the Gulf states that the West still had their interests at heart, a succession of leading Arab politicians questioned whether they could any longer trust the Americans to support their cause. This was particularly true of Bahrain, which, having provided the US Navy with a vital operating base for more than four decades, now finds itself under almost daily assault from Iranian-backed agitators who take their orders from the very same ayatollahs Washington is negotiating with on the nuclear issue. As Sheikh Khalid bin Hamad al-Khalifa, Bahrain’s foreign minister, explained to me: “You do not need to reassure us; you need to listen to us, because we know Iran well.” Clearly, Bahrain would welcome any deal that prevents its intimidating neighbour from acquiring an atom bomb. But it has other concerns, too, such as ending Iran’s open support for the terrorist groups that are trying to destabilise the kingdom, as well as many other Arab states, including Saudi Arabia. Indeed, the Saudis were even more

Bahrain would welcome any deal that prevents its intimidating neighbour from acquiring an atom bomb. forthright, with Nizar Madani, Saudi Arabia’s foreign minister, stating bluntly: “Gulf countries should no longer depend on others to ensure their safety.” There was little doubt who he meant by “others”. The alarming breakdown in trust between Washington and Arab leaders has certainly not escaped Moscow’s attention, with Russia intensifying its efforts to move into countries that for decades have been stalwart American allies. Prince Bandar bin Sultan, the Saudis’ formidable intelligence chief, has recently made several visits to Moscow, and last month held talks with Mr Putin on resolving the Syrian crisis and the Iranian issue. Last month, meanwhile, Russia sent a high-level delegation to Cairo, where the recently installed military authorities are in no mood to take any more lectures from Mr Obama on how to run their country. Russia still has much ground to make up if it is seriously to challenge decades of Western hegemony in the region, but the prospect of Mr Putin increasing his control over Europe’s primary source of energy supplies is not a thought that inspires confidence. Mr Hague, for one, is certainly aware of the pitfalls of this tilt towards Russia, and spoke eloquently in Bahrain about his determination to deepen Britain’s ties with the Gulf on the basis of “mutual understanding”. Apart from the prospect of negotiating a £20 billion arms deal, plans to revive Britain’s military presence east of Suez, which are currently being given serious consideration by Downing Street, would be a welcome demonstration that Britain, at least, cherishes its historic ties to the Gulf. GFI

Gulf Insider January 2014


Bahrain Finance


BAHRAIN IN 2014 By Nicholas Cortes

A damning Audit Report that Bahrain is living its fiduciary life at an unsustainable rate in terms of borrowing and expenditure and a failure to reel in public waste, gets a shrug. In truth, most believe that as long as the Abu Saafa oilfield keeps pumping, “why worry.”


hen the Finance Minister argues in Parliament that the Government’s financial subsidies for oil and byproducts, which last year cost BD228 million, is unsustainable and that the price at the pump should be increased for the first time in 50 years, there are howls of protest from the parliament and no abatement in the import of huge 4WD’s or big luxury cars. Public debt continues to grow, and last year the debt ceiling was increased by 42%, which puts the repayment of borrowings schedule into ‘untenable’ territory unless there are significant debt write-offs. While the national carrier Gulf Air has done a marvelous job of restructuring


Gulf Insider January 2014

Finance Bahrain

Tourism figures are also up with visitors from Saudi Arabia increasing the weekend numbers to 30,000 and filling the hotels, restaurants and night-spots. and reducing its annual loss to ‘only’ BD74 million (down from one million a day), that figure doesn’t include BD316 million, as a yet unpaid fuel bill. Creative accountancy perhaps, but still that bill is on someone’s books. The money from the Gulf $10 billion aid fund for Bahrain following the destabilizing events in the wake of the February 2011 demonstrations, after the usual economic lag, are starting to find their way into the economy, especially in housing and construction. The economic multipliers are funding increased consumer credit and spending. The malls are proliferating, and again awash with custom. Good signs indeed. Tourism figures are also up with visitors from Saudi Arabia increasing the weekend numbers to 30,000 and filling the hotels, restaurants and night-spots. Good silver lining stuff, but let’s not disregard the recent stinging criticism, by a leading hotel manager, that ‘during the week’ patronage, on average, was less than 40% room occupancy, and that not enough was being done to promote Bahrain properly as a complete destination. It was not enough to merely rely on a booming oil economy in Saudi Arabia’s Eastern Province. Corroboration came in figures produced by the noted realtor; Cluttons that while rental accommodation figures were slowly picking up again, many leases were to people who did the daily commute to Saudi Arabia. There remain however, many compounds with empty houses and apartments. But more intuitively perhaps that more needs to be done to sustain and grow the ‘green shoot,’ there remains a huge glut in commercial property and most telling, the ‘price per square metre’ continues to fall. The job market remains largely static, food prices continue rising, legal and judicial processes continue to grind slowly and despite numerous calls for the slashing of red tape, the actual

activity to do so moves at glacial speed. There continue to be calls for further pay increases for civil servants and an increasing concern amongst expatriates that calls from elsewhere in the Gulf to ‘tax remittances,’ may find fertile ground in Bahrain. But looking on the bright side, the country has its good governance credentials largely intact. Reaction to the BICI recommendations has been welcomed with positive plaudits although urging speedier implementation on the still outstanding matters. Bahrain’s internal opposition look rudderless and bereft of ideas and their decision not to join the dialogue is real ‘egg on face’ stuff for an international audience that sets high score on discussion. The continued ‘block, burn and buzz off’ tactics by Molotov hurling thugs, are now as flickering as their fires which once set whole press pages ablaze. The concept of ‘peaceful demonstrators’ has died hard, with a vengeance, but died it has. The Rulers and the Government look flexible and amenable to ideas and discussion, the opposition, surly, curly and rigid in that few stooges sort of way. Bahrain is still regarded as the easiest place in which to do business in the region, particularly in banking and insurance, while its democratic freedoms, general tolerance and engaging lifestyle choices, makes for easy living, for locals and expats. There have been a number of key visitors from economic powerhouses, China, India, Japan, South Korea, Singapore as well as high level contacts from the US, France and UK so the ‘promise’ of increasing trade and investment now needs to be realized. GFI

The author is a former senior diplomat and political adviser with extensive international experience in strategic and parliamentary affairs, and is currently working in Bahrain. Gulf Insider January 2014


Bahrain Business



he Invest in Bahrain forum on October 30 highlighted an important fact - Bahrain has well and truly recovered from its setbacks and presents an attractive opportunity for foreign investors. The government, with its vision for 2030, is actively fostering a spirit of entrepreneurship and removing obstacles to setting up new businesses. The Invest in Bahrain forum aimed to explore new ways of boosting the economy and promoting investment. The two-day event was organised by the Ministry of Industry and Commerce (MOIC) in cooperation with Bahrain Chamber of Commerce and Industry, Bahrain Economic Development Board, the Central Bank of Bahrain, the Labour Fund (Tamkeen), Bahrain Mumtalakat Holding Company, The Gulf Organisation for Industrial Consulting (GOIC), the UN Industrial Development Organisation (UNIDO) and the GCC Chambers of Commerce and Industry Union.

Economic Vision 2030 The Bahraini government’s vision for 2030 is to shift from an oil-based economy to a more competitive one driven by the private sector and a strong Bahraini middle class. An allencompassing government strategy to stimulate the private sector is already showing results. According to data from the Central Informatics Organisation, Bahrain’s GDP has been growing at a rate of 4.5 per cent, with finance and manufacturing overtaking oil as the largest sectors of the economy. Financial services account for 25 per cent of GDP and manufacturing makes up 16 per cent, while petroleum and natural gas make up 13 per cent of the total. 32

Gulf Insider January 2014

Foreign trade relations In 2004 Bahrain became the first GCC state to sign a free trade agreement (FTA) with the US, even enduring tensions with its neighbour Saudi Arabia for doing so. Implementation of the agreement in 2006 made Bahrain a regional hub for international investors seeking to tap into the vast US export market. More recently, Bahrain, along with other GCC members, is poised to sign a number of FTAs with several countries and economic blocs including Japan, the European Union (EU), Association of South East Asian Nations (Asean), South Korea, China, India, Turkey, Russia and Australia. Bahrain’s overall objective for the FTAs is to facilitate trade flows, stimulate inward flows of investment, expand key manufacturing and services sectors, and encourage the exchange of expertise to create employment opportunities and stimulate economic growth in Bahrain. The new FTAs were reviewed in a Cabinet session in September, where it was determined that they were “in line with the framework of political and economic co-ordination between GCC states and other economic, regional and international blocks and groups in accordance to the GCC’s Economic Agreement.” They will now be studied by the concerned ministerial committee before a final report is submitted to the Cabinet.

Encouraging SMEs The government organisation Tamkeen is an integral part of Economic Vision 2030. Working in collaboration with the Bahrain Development Bank (BDB), Bahrain Islamic Bank (BISB), and BMI bank, it supports Bahraini businesses by providing them with low cost financing

Business Bahrain

Foreign investors are allowed to have 100 per cent ownership of their business, with no restrictions placed on capital repatriation, currency exchange and transfer of dividends.

The MOIC’s strategy to help achieve the government’s 2030 objectives includes Fostering a fair and transparent regulatory environment  Increasing the level of competition  Facilitating entrepreneurship in the Small and Medium Enterprises (SME) Sector  Strenghtening the manufacturing sector  Maximising benefits from foreign trade relations 

solutions. Tamkeen pays the banks’ profits on the financing on behalf of the enterprises, among other incentives. More than 77,000 Bahraini individuals and enterprises have benefited from Tamkeen’s programmes since its inception in 2006, 80 per cent of which have been SMEs. The total figure is expected to rise to 150,000 in the near future. These efforts have not gone unnoticed; Tamkeen won an award for Best Initiative Supporting SMEs In Arab Countries in last year’s Mohammed bin Rashid Award for Young Business Leaders.

Streamlining procedures Data compiled by the MOIC shows that an estimated $51.4 billion has been injected into the economy since the start of commercial registrations (CR); streamlining the procedure of setting up new businesses and getting them registered is expected to encourage more investment. To that end, the Ministry has created a “onestop shop” in the form of the Bahrain Investors Centres (BIC) at the Seef Mall and at the Bahrain Chamber of Commerce and Industry in Sanabis. It is hoped that they will eventually be able to process and handover a CR in just 40 minutes. The capacity of the BICs has recently been increased by keeping them open on Saturdays and by adding more registration staff. Future plans include enabling people to submit applications, make payments and get approvals online from next year onwards. The centres will also gather all of the most relevant government agencies in one place, such as the Ministry of Justice-Documentation, Municipalities-all provinces, General Directorate of Nationality and Passports, Culture Ministry, Information Affairs Authority, General Directorate of Civil Defence, Criminal Investigation Department, Labour Market Regulatory Authority, Electricity and Water Authority, Health Ministry and Customs Affairs to make the procedure as quick and easy as possible. Bahrain was ranked 12th on the Heritage Foundation Economic Freedom Index 2012 for its mature financial, commercial, and banking services. Foreign investors are allowed to have 100 per cent ownership of their business, with no restrictions placed on capital repatriation, currency exchange and transfer of dividends. This, coupled with one of the most developed political structures in the region, provides a fertile environment for businesses to grow. With events like Invest in Bahrain highlighting these advantages to foreign investors, Bahrain may be on its way to realising its vision for 2030. GFI Gulf Insider January 2014


GCC Summit



eaders of the six GCC member states met in Kuwait on the 10th and 11th of December for the 34th annual Gulf Cooperation Council Summit to discuss ways to work together in the areas of defence, security, and political and economic long term interests. The GCC foreign ministers met in Kuwait a day prior to the summit to fine-tune several points on the agenda, which finally included a discussion on the Middle East conflicts, Iran’s nuclear programme, and a proposal to create an EU-like GCC union. The Summit was chaired by Kuwaiti Amir His Highness Sheikh Sabah Al Ahmed Al Jaber Al Sabah in the Al-Tahrir Hall at Bayan Palace who stressed in his opening speech the importance of maintaining cooperation between GCC members to overcome regional and international challenges. Saudi Arabia has been pushing for a Gulf Union since 2011, claiming that it was time for the GCC member states to move from the phase of cooperation to the phase of union. However, at the Manama Dialogue three days before the GCC Summit, the Omani foreign minister Yousuf bin Alawi surprised the audience by stating bluntly that his country was not interested in the Gulf Union and would pull out of the new body if it went through. Oman has reservations about a political unity that could undermine its ability to maintain a neutral position with respect to Iran. Nonetheless, an extraordinary summit is expected to be called in Riyadh to announce the establishment of the Union. It was agreed at the GCC Summit to set up a unified GCC military command as well as a Gulf police force to broaden security cooperation and fight terrorism. The GCC leaders have also approved a 34

Gulf Insider January 2014

proposal for setting up the Gulf Academy for Strategic and Security Studies and welcomed the UAE proposal to host it. Bahrain has been among the staunchest supporters of the Gulf Union. Bahrain’s Defence and National Security Committee’s Chairman, Sawsan Taqawi stated these were the most important outcomes reached at the GCC Summit and pushed for the implementation of other Gulf projects such as Gulf customs union, Gulf unified currency, human rights, railway, environment, education and health.

Saudi Arabia has been pushing for a Gulf Union since 2011, claiming that it was time for the GCC member states to move from the phase of cooperation to the phase of union. While expressing satisfaction at the current state of the GCC economies, the member states made a push for further economic cooperation, endorsing a number of unified rules regarding the integration of financial markets. They commissioned a study into the setting up of an entrepreneurship fund to support the youth’s SME projects. The leaders were also briefed on the details of a joint GCC railway project that is set to take off by 2018. On the topic of relations with Iran, the

GCC leaders emphasised the importance of good neighbourliness, noninterference in internal affairs, respect of sovereignty of regional countries, and refraining from the use or threat of the use of force. They welcomed the recent nuclear agreement between Tehran and the P5+1 group (the five permanent members of the UN Security Council plus Germany), stating that this preliminary agreement was the first step towards ending international and regional concerns about Iran’s nuclear programme and clearing the region of weapons of mass destruction. Other international affairs discussed were the US efforts to facilitate Israeli-Palestinian dialogue, which led to the establishment of an independent Palestinian state with Occupied Jerusalem as its capital; the acts committed by the Syrian regime against its people; and a pledge to support the Egyptian economy to enable the Egypt to regain its leading role on the Arab and international stage. The Council rejected Iran’s continued occupation of the three UAE islands of Abu Musa, Greater Tunb and Lesser Tunb. A closing communiqué was delivered by GCC SecretaryGeneral Dr. Abdullatif bin Rashid Al-Zayani, who was elected to the post for a second term following the Summit. The GCC was established in May 1981 in Riyadh, where it is headquartered. The presidency of the GCC rotates periodically among the member states in alphabetical order. Bahrain was the president of the GCC last year. Next year the presidency will pass from Kuwait to Qatar, with HH Sheikh Tamim bin Hamad Al Thani the Amir of Qatar being the Chairman of the upcoming 35th GCC Summit. GFI

Global Finance



ive years after the start of the financial crisis, the global economy continued its slow healing process in 2013. As we head into 2014, does real growth finally have a chance to take hold? Are there signs that unemployment in the developed world can wane enough to stop being a huge drag on economies? Will central banks be able to normalize monetary policies or will quantitative easing remain for another year? Experts from across Natixis Global Asset Management address these questions and share their views on whether the economic landscape will be supportive to investors in 2014.

James Balfour, Senior Macro Strategy Analyst Loomis, Sayles & Company

Balfour expects global economic growth to accelerate modestly from 2.7% to 3.6% in 2014, with the acceleration in growth concentrated in some of the larger advanced economies. “We are most optimistic on the sustainability of growth from the U.S., where the total impact of the drag from government policy on economic growth is likely set to fade sharply going into 2014,” said Balfour. This boost to growth along with a continuation of the housing recovery could potentially lift the U.S. growth rate toward 3% as the year progresses. Balfour also believes the U.K. is poised for a similar rate of growth in 2014 as well. But according to Balfour, the strongest contribution to the step up in global growth should emerge from Europe as it pulls out of an 18-month recession. While Balfour believes most countries will benefit from the acceleration in global growth next year, monetary policy cycles are on very different tracks around the world. The rise in U.S. yields has lifted yields globally, which has put some downward pressure on global growth and inflation and hit some countries harder than others. “The euro zone is showing the most sensitivity of advanced economies to the global rise in yields with deflation risks rising as inflation slows. The bias for the European Central Bank (ECB) is to find new ways to ease monetary policy in 2014,” said Balfour. For the first time in a while, Loomis Sayles sees macro risks tilted to the upside with diminishing risks in developed economies and increasing risks for emerging economies. “We see the advanced economies moving through a slow transition toward modest but synchronized growth across the developed economies, where consumers gain confidence in future growth and companies respond


Gulf Insider January 2014

Finance Global

by shifting toward more hiring and investment,” said Balfour. Also, the favorable outlook for energy prices, Balfour believes, should create a tailwind for a more sustainable period of global growth, unlike the recent past when rising energy prices had been holding down potential growth rates.

Philippe Waechter,

Chief Economist Natixis Asset Management The way Waechter sees it, global economic activity in 2014 should be more positive than 2013, which was also more positive than 2012. Nevertheless, he cautions that the global economy will likely remain weak. In fact, the Organisation for Economic Co-operation and Development (OECD) in November revised down its global growth forecast for 2014 to 3.6% from its previous estimate of 4%. A key concern Waechter has is that growth forecasts for the U.S., China, U.K., and Euro area remain below the pre-financial crisis growth rate average. “This shows that global momentum is sluggish and we will probably not have a strong economic acceleration that could help to jumpstart the global economy,” said Waechter. This low level of growth, he believes, will continue to keep labor markets of most industrialized countries weak. In the U.S., the unemployment rate, which is currently at 7.3%, will not improve that much in the new year according to Waechter. In the Euro area, where the rate lingers around 12.2%, the target will be to simply stabilize the unemployment rate. “Collectively, this is not very ambitious, but with low-growth rate numbers, we cannot expect more.” On a more positive note, Waechter points out that the country’s increase in oil production does mean it can develop more oil than it imports. “This doesn’t mean energy independency just yet, but it does increase autonomy,” he said. Ultimately, Waechter believes the new world currently under construction will more and more be defined by globalization – with intense trade between countries, but also with the willingness to be able to grow in a more autonomous way. “We are still creating

We see the advanced economies moving through a slow transition toward modest but synchronized growth across the developed economies. this new global economic framework. This transformation is not over yet,and that’s why the situation is more complicated and the ongoing uncertainty is lingering longer when compared to previous recessions,” said Waechter.

Michael Buckius, Chief Investment Officer Gateway Investment Advisers

The biggest macro risk the investment markets most likely will have to contend with in 2014 is the continuation or the “tapering” of the Fed’s quantitative easing programs, according to Buckius. “Those programs have provided a significant tailwind to asset prices, including stocks for a number of years. Therefore, changes in Fed policy could have pretty farreaching effects. So this policy shift is something we’re keeping an eye on quite a bit at Gateway,” said Buckius. Buckius’ outlook for volatility in 2014 is pretty much the same pattern as investors have witnessed in 2013. “That pattern includes extended periods of low volatility with pretty significant spikes when issues come along. And I think there’s no shortage of issues that the market has to contend with next year, including the potential tapering of the Fed’s liquidity programs and part two or part three of the U.S. government’s budget negotiations and debt ceiling negotiations.” GFI

Gulf Insider January 2014


Feature Investment

COUTTS OUTLOOK 2014 How to make money in an era of low growth.


outts has launched its 2014 investment outlook entitled Today & Tomorrow, which highlights their view of the economic landscape and key investment themes. The publication provides insight into the strategies investors should consider today to build a portfolio for tomorrow, according to Coutts’ three Chief Investment Officers – Alan Higgins for the UK, Gary Dugan focused on Asia and the Middle East and Norman Villamin covering Europe. Gary Dugan, Chief Investment Officer for Asia and the Middle East at Coutts, said: “Although global stock markets recovered in 2013 as investors’ optimism returned, we believe policymakers face a triple challenge of indebtedness, quantitative easing (QE) and changing demographics. As a result, we believe we are in for a sustained period of low growth and low interest rates.”

In order to best manage investments in this economic environment, the key investment themes are:  Keeping it safe – low bond yields have been causing investors anxiety for years, 38

Gulf Insider January 2014

but there are ways to enhance yields without taking too much risk. European and UK investment-grade bonds can offer protection against interest-rate uncertainty at a reasonable price. Some emerging-market corporate bonds in Asia may play an important role in portfolios for investors willing to accept the greater risks inherent in this asset class. Stocking up on income – dividend growth pays when real interest rates are negative, but don’t just focus on those that yield most. The income play has been popular for some years, so selection is important. We would look for sectors that offer net dividend yields that are historically above average, and with room for dividend growth.

Quest for growth – investors need to drill down deeper to unearth growth potential. We still prefer equities over bonds as we enter 2014. Emerging markets continue to have long-term growth potential. In terms of equities, shares in the luxury goods sector trade at a discount to many world equities. Technology companies offer growth

Low interest rates mean that investors need to step up the risk ladder in order to achieve returns. potential although you may want to look beyond the sector’s giants for the best opportunities. Changing risks – political instability remains a threat to Europe’s fledgling recovery. Japan’s politicians are playing with high stakes. Low nominal growth rates in developed nations mean tax hikes are a real possibility.

Who dares wins – low interest rates mean that investors need to step up the risk ladder in order to achieve returns. High-yield bonds are now closely correlated to equities. Consider absolutereturn funds to diversify portfolios. Cash deposits will continue to lose money in real terms (i.e. after inflation) for savers. GFI

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GCC Business

MARKET SURGE LEADS TO WAVE OF ARABIAN GULF IPOs Accelerating economic growth, a price rally in GCC equity markets and increased market liquidity have encouraged more companies to consider initial public offerings (IPOs), which may attract extra investor interest in the region.


n the last couple of months, Dubai property developer Damac Properties offered depositary receipts on the London Stock Exchange, while fast food chain Just Falafel and Qatar Petroleum have both hired bankers to advise on potential IPOs. This follows a London listing this year by UAE healthcare company Al Noor Hospitals Group, which raised US$ 221 million. This burst of activity follows a lull in IPOs following the global economic crisis, with companies in the Gulf Cooperation Council (GCC) raising around


Gulf Insider January 2014

Business GCC

US$ 1.3 billion between 2008 and 2012, about a fifth of the level raised in the previous four years. A major driver is the lower cost of capital as risk premiums have declined, and valuations of companies have been rerated by investors in the expectation of profit growth. For example, Dubai CDS spreads have narrowed to just over 200 basis points, from above 500 in mid-2011. The S&P GCC composite and large cap index has risen 20 percent this year, while top performing Dubai Financial Market index is up over 80 percent and the Abu Dhabi Securities Market index has gained over 50 percent. As a result, UAE companies are now trading at just over 12 times earnings, compared to 10 times a year ago, and GCC companies are on average 14 times earnings, up from 12 times a year ago. Healthy macro-economic fundamentals are also persuading companies that this is the right time to raise growth capital and diversify away from bank lending -- through various means, including IPOs but also property sale-leasebacks, syndicated loans, and bond issuance. Robust oil prices have allowed governments to maintain a heightened level of spending on infrastructure and areas such as health and education, while the UAE has bounced back from the crisis due to strong trade flows and fast rising visitor numbers, keeping shopping malls and hotels busy. In October, the International Monetary Fund (IMF) increased its forecast for 2014 GDP growth for the GCC to 4.4 percent from the previous 3.79 percent, citing the impact that infrastructure development was having on the non-oil segment of the regional economy. The IMF predicts 3.7 percent growth for 2013. IPOs are likely to come from the consumer, financial, logistics and industrial sectors, where companies are formulating ambitious plans to take advantage of the rapid growth in consumption across the region. These sectors have developed almost from scratch over the last 20 years and have now reached a stage in their

lifecycle where corporate consolidation will become a necessity for profitable growth. Companies are finding IPOs useful not only to raise the capital necessary for acquisitions, but also to provide stock option incentives to attract and retain talent in highly competitive areas of the economy. The health and education sectors are also likely to see more listings, having been identified by governments as areas that need substantial investment because of a wide demand-supply gap. In the medium term, government companies in the non-oil sector may also list in order to diversify funding sources, and also to support policy to deepen the region’s capital markets. There have been

UAE companies are now trading at just over 12 times earnings, compared to 10 times a year ago, and GCC companies are on average 14 times earnings, up from 12 times a year ago. reports that Saudi government-owned Islamic bank NCB has been preparing for an IPO and Qatar is also looking at listing some of its state assets. London has been a preferred listing destination in the last couple of years because of factors such as liquidity, sector representation, inclusion in sector-specific indices, and the presence of market makers, but that will not necessarily continue to be the case. This trend is in many ways encouraging, demonstrating that management expertise and levels of corporate governance and disclosure in the region is reaching international standards – and there is evidence that local regulators

have been encouraging foreign listings behind the scenes. But this year’s surge in local investor interest in GCC markets could now persuade some companies to look at their home markets and a shareholder base that understands the economic drivers of corporate growth and puts the regional risk in better perspective. On-going efforts by stock exchanges to improve and simplify regulatory standards are also increasing the attraction. The MSCI upgrade to emerging market status for the UAE and Qatar should, over the long term, also encourage greater participation by active emerging market institutional investors in these markets. Analysts believe the upgrades will bring in around US$ 350 million from exchange traded funds alone to the two countries. Investor sentiment in the GCC region continues to remain cautiously positive, and Dubai’s successful bid for Expo 2020 is likely to give a shortterm lift to UAE investors, although the real economic benefits to sectors such as construction, and ultimately tourism and retail, will be felt gradually over the coming years. As the year end approaches, attention will turn to fourth-quarter results and potential for dividends, although investors will also be closely watching the U.S. Federal Reserve’s next meeting for possible tapering of its bond-buying programme. Saudi Arabia’s massive crackdown on illegal foreign workers, which has made recent headlines, is unlikely to dent the country’s consumer story – which is built on rising middle class incomes – but could well start to pressure corporate margins, as the process of Saudisation, and employment of legal workers drives up employment costs. In the UAE, the central bank’s recently announced loan-to-value caps for mortgages are a positive development for the property market – allowing reasonable levels of lending while helping to ensure that bank balance sheets are not overly exposed to the sector. GFI

This market commentary has been provided by Invest AD fund managers –

Gulf Insider January 2014


Global Real Estate

GLOBAL REAL ESTATE TRENDS Knight Frank’s latest Global Investment Report predicts demand for prime property in the world’s major cities will continue to strengthen in 2014, and includes an analysis of Islamic investment and structures.


espite the improving economic news, the recovery in global occupier markets has so far been patchy. The improved economic backdrop has nonetheless boosted property investment activity, with data from Real Capital Analytics suggesting that global transaction volumes for commercial property amounted to US$ 224bn in H1 2013, up 11.7% on H1 2012. Much of the increase has been generated by a faster recovery in the US market. For Europe meanwhile, volumes reached €74bn in H1 2013 – a yearon-year rise of 7% – delivered in part through improved activity in Spain and Italy. However, investor demand in the periphery is focused keenly on prime assets let to strong covenants. In the first half of this year, Asia Pacific saw a year-on-year rise of 6% in commercial transaction volumes to USD56.9bn, although this figure excludes Chinese land deals which continue to account for the bulk of activity in the region. In gateway cities and robust economies there is evidence of increasing investor appetite for riskier assets and markets. A number of Sovereign Wealth Funds

– from China, Malaysia and Kuwait – remain focused on gateway locations, while the South Koreans and Qataris are now increasingly exploring opportunities in medium-sized and smaller cities. Government regulation – and changes to it – continues to be a major influence on global capital flows. One of the most significant recent changes has been to allow Chinese insurance companies to invest abroad. In October 2012, the Chinese Insurance Regulatory Commission (CIRC) allowed i n s u r a n c e companies to invest directly in international real estate, although there remain restrictions on the countries and sectors where they may invest. As a result, Chinese insurers have started to make inroads into international real estate markets, notably the UK. Chinese property investors generally have been more active in global residential and commercial markets, spurred on by a stronger renminbi and a desire to gain exposure to safe haven cities such as London, New York and Sydney. A similar change to insurance regulation is underway in Taiwan, which should see a gradual increase in international property investment

Looking forward to 2014, the outlook for global property investment is more positive than twelve months ago.


Gulf Insider January 2014

Real Estate Global

by insurers over the next 12-18 months. Initially, activity is likely to focus on a small number of Far Eastern cities, in addition to the core financial centres of Europe and North America. Looking forward to 2014, the outlook for global property investment is more positive than twelve months ago. Indeed, if anything, demand for prime commercial property in the world’s major cities is likely to continue to strengthen over the coming year, as investors seek greater exposure to the global economic recovery. While investors must inevitably face the challenge of rising interest rates as central banks begin to wind down QE, the short term impact on yields should be limited, given the improving prospects for rental growth.

Islamic investment One of the main principles of Islamic finance is the creation of wealth through

real, tangible assets. In this respect, the real estate sector is well established as an area of investment in Muslim countries and, in recent years, has come to the fore in the West. Of the major global property markets, the UK (and notably London) has seen some of the most significant Shariah-compliant transactions. Islamic investors have been attracted not only by size and liquidity of the market but also by the accommodating legislative framework, which recognises the principles of Islamic finance, and a developed Islamic banking system. In addition to a small number of trophy deals, Islamic investment has also targeted prime residential property, hotels, offices, logistics and student accommodation, with interest increasing in other “social infrastructure� such as healthcare, education and social housing. There is a notable lack of data on Islamic real estate investment, making it difficult to accurately estimate the size of

Gulf Insider January 2014


Global Real Estate

the global market. However, in the UK, it is estimated that around £500m of Shariah-compliant deals take place every year, representing around 1% of total commercial property volumes, based on an analysis of major deals undertaken by a number of large banks in the last decade.

Islamic deal structures In addition to being asset-backed, the other main principles of Islamic real estate finance relate to the underlying tenants who occupy the properties and how the investments are structured financially. Tenants must not be involved in activities which are not Shariahcompliant, such as the sale and manufacture of alcohol, tobacco and pork, or industries such as conventional banking, insurance, arms manufacturing and sales or gambling. In particular, potential investors need to be aware of the scope for tenants to assign their leases. As a result, Islamic investors have different risk profiles to conventional investors, as they need to be more careful in terms of tenant selection. Multi-let 44

Gulf Insider January 2014

buildings can often present problems in this respect. For example, when faced with a vacancy, the Shariah-compliant landlord would not be able to accept a new tenant which operated a noncompliant business, thereby reducing the number of potential occupiers. Most equity transactions are straightforward, provided the tenant is Shariah-compliant. However, Islamic structures involving third party financing can be complex. The use of leveraged finance is permissible but this must be done under an approved Islamic structure. Conventional commercial mortgages are not permissible as this involves the payment of interest or “Riba”, which is forbidden under Shariah principles. One of the Shariah-compliant methods of property investment is the use of Commodity Murabaha. This method allows “conventional” banks to participate in Islamic transactions.

addition, the combining of conventional finance and Shariah-compliant finance techniques to fund real estate investment is a growing area which has enabled a number of deals to proceed that may otherwise not have found financing. Looking forward, it is clear that Islamic investment and finance will expand strongly in the coming years, with some research suggesting that the global value of Islamic assets will reach as much as USD2.6 trillion by 2017. Recent examples of its continued expansion include the Sukuk launches in Oman, Morocco and Nigeria, while other countries continue to enhance their legal frameworks to facilitate the market for Islamic compliant transactions. Kuala Lumpur remains the key centre for Islamic investment and finance in Asia Pacific, while London – which hosted the World Islamic Economic Forum in October 2013 – has firmly established itself as the leading hub in Europe. GFI


This article is an edited extract from the Knight Frank Global Investment Report 2013-2014. To receive the full report contact

Currently, Islamic investment represents only a tiny fraction of the overall property investment landscape but its growth potential is significant. In



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Gulf Insider January 2014


Feature Profile


Winner of two Olympic silver medals, Ian Walker is one of Britain’s most successful sailors and will Skipper Abu Dhabi’s next entry into the 2014/2015 Volvo Ocean Race.


hen Britain launched its first bid for the America’s Cup for 14 years in 2000, Walker was named as skipper. In 2011/12 Walker skippered Abu Dhabi’s first entry in the Volvo Ocean Race - Abu Dhabi Ocean Racing and has been appointed to lead Abu Dhabi’s next entry. With nine months to go until the start of the 2014/15 Volvo Ocean Race, Abu Dhabi Ocean Racing (ADOR) skipper and two-time Olympic silver medallist, Ian Walker, looks ahead to the countdown to the greatest sailing adventure known to man. “We have a massive 12 months ahead and a huge amount to

accomplish before we even get close to the start-line in Alicante in October, from receiving the new ADOR Volvo Ocean 65 yacht, to announcing our full team line-up, to getting those all-important sailing days under our belt. “I am not a huge fan of New Year resolutions, but if I were to name three for 2014, they would look like this; 1. “To delegate more to the excellent team I now have around me 2. “To get fitter and stronger than ever before 3. “Don’t break the mast on the first night of the Volvo Ocean Race! “With a bit of luck, this time next year we will be spending New Year in Abu Dhabi after having sailed into the city at the end of leg two in December, and it will be a great thrill for me and the whole team to witness another homecoming reception from the people of the UAE.”

Ian Walker 46

Gulf Insider January 2014

The next edition of the Volvo Ocean Race will be the 12th running of the 40-year-old event, which started in 1973 as the Whitbread Round the World Race. The race will start on October 4, 2014, day of the first In-Port Race in Alicante, Spain, and finish with one last In-Port Race on June 27, 2015 in Gothenburg, the Swedish home of Volvo. The 39,379-nautical mile route will also include stopovers in Cape Town (South Africa), Abu Dhabi (UAE), Sanya (China), Auckland (New Zealand), Itajaí (Brazil), Newport, Rhode Island (USA), Lisbon (Portugal) and Lorient (France). GFI

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Hospitality The Oberoi

THE OBEROI, DUBAI Gulf Insider visits Dubai’s newest luxury hotel.


he Oberoi, Dubai, which opened last June, is located in Dubai’s fast developing Business Bay, looks out across to the world’s tallest building, the Burj Khalifa, and is conveniently placed for Downtown Dubai, Dubai International Financial Centre, and Dubai Mall. The Oberoi Group, founded in 1934, currently operates 30 luxury hotels plus a Nile cruiser and a motor vessel in the backwaters of Kerala. The brand has a reputation for luxury and personalized service. I experienced this first hand upon arrival when I was shown directly to my room without having to go through the usual inconvenience of being required to check-in. Inside my gorgeous room was a collection of fruits and candies including a photo portrait of me made from chocolate… now that was a first! Soon there was a knock on the door and I was greeted by a smartly dressed lady who informed me she would act as my butler during my stay. Every guest has access to a personal butler and concierge services.


Gulf Insider January 2014

The hotel has three first rate restaurants. Ananta is an Indian restaurant decorated in warm and rich red tones. Dishes include North Indian delicacies and daily selection of Indian coastal specialties. Umai is Asian themed with live tepanyaki, sushi, sashimi and noodle stations. Pretty girls serve tea in a most energetic ‘Kung Fu” style, and this restaurant has the only UAE licensed Fugu Chef to specially prepare Japan’s legendary poisonous Blow Fish for diners. Nine7One is the largest restaurant in the hotel and offers a wide selection of international cuisines. A kids menu

offers Snow White & Seven Dwarfs pasta, Pinocchio salad and other fun meals. There’s outdoor seating available and you can enjoy your meal within a courtyard setting next to a large and attractive water feature. It was at Nine7One (971 is the dialing code for UAE, get it!) that I enjoyed a fabulous Friday Brunch with friends. The choice of food really was amazing, with a focus on tapas style eating enabling guests to sample multiple delights. Choices included crazy dishes created with liquid nitrogen that brought to me taste sensations like I have never experienced, and a live DJ played great music throughout the afternoon. The unlimited sparkling being served was no less than Moet & Chandon! But beware, the all inclusive brunch stops at 4 pm and the 2 glasses of Moet we ordered afterwards set us back Dhs 320. Another cool place is the Iris Roof Top, way up on the 27th floor, where I sat outside on the balcony area and marveled at

The Oberoi Hospitality

Inside my gorgeous room was a collection of fruits and candies including a photo portrait of me made from chocolate… now that was a first! the Dubai skyline while sipping delicious cocktails in a sophisticated yet friendly atmosphere. There’s a 24-hour spa - I enjoyed an hour long Thai massage, it was excellent; the masseur superb, a state of the art gym, and a decent sized outdoor swimming pool where staff will, without being asked, bring you chilled bottled water and tanning lotions if you don’t have your own with you. When the hotel opened in June the people behind this brand promised the hotel’s opening “heralded a new era of luxury in the UAE”. That’s quite a claim as anyone who stays in any of this emirates up-market hotels will know. “New era of luxury?”, well no. But that’s not to say this property, with its wonderfully attentive and friendly staff isn’t as good as it gets here. Despite being open for such a short time, this Oberoi has already made its mark and been ranked number 9 out of all the hotels in Dubai on TripAdvisor, and it’s design has received recognition with Wallpaper Magazine by being shortlisted for the Annual Best Urban Hotels 2013 – the only hotel in the UAE featured. GFI

For reservations or further info visit

Gulf Insider January 2014


Travel Queensland


A BRIEF GUIDE TO QUEENSLAND, AUSTRALIA Last month Nick Cooksey wrote of his visit to Sydney. In this concluding article he covers Queensland.


ueensland is known as the “Sunshine State”. It is a major tourist destination due to being blessed with so many places of natural beauty including surfing beaches, waterways, rainforests, mountains, waterfalls, picnic areas, and bodies in bikinis. The capital and largest city in the state is Brisbane, which is Australia’s third largest city. It’s a modern, well planned and beautiful city offering lots of good shopping and all sorts of clubs, eateries and other fun things to do and places to go. A great way to explore Brisbane that is both efficient and fun is to take the City Hopper, a ferry service that stops at points along the river and is free to use. I used the City Hopper to visit the 50

Gulf Insider January 2014

Gallery of Modern Art, Australia’s largest gallery of modern art, and was disappointed by the works on display which like so much modern art seemed to be nothing more than childish nonsense. If something appears to have no point should one dig deeper until a point manifests? The supposed ‘art’ inside this building palled before the beauty of the nature and the architectural genius of the impressive city buildings and landscaping that surrounded it. Outside of town, Currumbin Sanctuary is definitely worth a visit, with hundreds of native Australian animals on display within 27 hectares of natural bushland and rainforest settings. Here you can cuddle a koala (which I did), get up close to a crocodile (nope!), and get

amongst a mob of kangaroos (yup) ( The Gold Coast is just 94 km south of Brisbane and a major tourist destination. A great fun thing to do is take a helicopter ride around the city as we did. We had a nervous flyer in our group who despite initial worries decided to take the chopper ride with us and was very glad she did, revealing that once in the air she lost all her fear because she was so engrossed by the scenery below. It’s worth mentioning that the company, Gold Coast Helitours, in their many years of operations have never had a single accident ( Another high view is offered by the SkyPoint Observation Deck. Located

Queensland Travel

It’s a modern, well planned and beautiful city offering lots of good shopping and all sorts of clubs, eateries and other fun things to do and places to go.

Currumbin Sanctuary

230 metres high on levels 77 and 78 of one of the tallest residential towers in the world, I was impressed by the spectacular 360 degree views of land and sea ( Shopping fans might want to pay a visit to the Harbour Town Outlet Shopping Centre. An outlet shopping location with 130 brand outlet stores and another 70 specialty stores, services + dining. ( Regardless of your age you should visit Warner Brothers Movie World. Kids can meet their super-heroes and movie attractions. They will also love the colourful Kids’ Fun Zone - a magical cartoon world. What I enjoyed most was a live action stunt show “Hollywood Stunt Driver”, words cannot describe the skills of the drivers and the entertainment value of this 20 minute action packed show. And finally, you will either love or hate the state-of-the-art fairground rides that will put your body through G-Forces and leave you either gasping for more, or in a state of shock ( My only regret on this trip is something I DIDN’T do. I regret not going with my group on an off road adventure in 4 wheel drives to Mount Tamborine as everyone said what a great… BRILLIANT… FANTASTIC time they all had on this adventure in sub-tropical rainforests in the World Heritage listed Lamington National Park. Part of the experience included learning to throw a boomerang and a guided rainforest walk with a friendly, knowledgeable local guide ( Oh well, maybe next time... Gulf Insider January 2014

SkyPoint Observation Deck


Travel Queensland

Travel info Brisbane Some recommended restaurants: Aria Restaurant. Offering spectacular views of the Brisbane River, relaxed yet elegant with an innovative contemporary menu. The Norman Hotel. Opened in 1889 and one of Queensland’s iconic dining experiences. The Fish House. Southern European style seafood restaurant with amazing views of the town and coastline Where we stayed: Brisbane Hilton. Five star hotel featuring newly renovated Executive and Business floor rooms and suites with access to the Executive Lounge. Also recommended is Vintaged Bar + Grill, an award winning restaurant located at the hotel. www. Gold Coast: Recommended Restaurants: Moo Moo The Wine Bar & Grill. Multi award winning Steak Restaurant located by Broadbeach, one of the most happening parts of town.

Gallery of Modern Art BSKT at Nobby’s Beach – a great place for breakfast. Where we stayed: Hilton Hotel Surfers Paradise. Centrally located in the heart of where all the action is, one and two bedroom residences include a separate living room, sofa bed, full kitchen, an internal laundry and sweeping views over the Gold Coast. When to go: Winter (June to August) is idyllically warm and dry with clear blue skies, cool nights, and average daytime temperatures of 22C. Summer (December to February) is hot and sticky with lots of rain – and you will be as grateful for air conditioning as in the Gulf. Getting around: We used Corporate Limousines, who


Gulf Insider January 2014

offer anything from stretch limousines to mini buses and can collect and deliver you to and from airports, hotels, and take you wherever you want to go in comfort and safety. We had the same driver throughout our stay in Queensland and he became almost part of the family ( Getting there: I flew into Australia via Abu Dhabi by Etihad Airways. Their Business Class cabin is exactly as advertised—the food was excellent, not just by ‘aeroplane food’ standards, service was impeccable, and the inflight entertainment was superb. The seats fully recline to a flat bed and so I was able to sleep most of the way and arrive rested and fresh, which was just as well as I was on the go for all the time I was there. GFI

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Events Meetup BH


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The Arabian Review

atelco has joined hands with Gulf Insider magazine in delivering a major national event for the youth segment. MeetUp Bahrain is a great initiative to bring together the many social communities and talented youth to create an environment of fun. There were variety of entertainment during a recent event including live bands, games, skateboard demonstrations, a photography contest, Bahraini Corvette Club’s car display and the Youth Innovation Centre of GOYS gave away ‘Bahrain Love Locks’. Batelco Group General Manager Media Relations Ahmed Al Janahi said that Batelco’s Youth Marketing team is very active in promoting entertaining events for Bahrain’s Youth Segment and have already organised and participated in a number of very successful events during 2013. “The youth of Bahrain are keen users of social media platforms such as Facebook, Twitter, Flickr and Instagram and they keep in touch electronically. This event will provide a great occasion to bring everyone together in one location, Shaikh Khalifa National Park, to enjoy a day of activities arranged by Batelco and Gulf Insider magazine,” he added. GFI


Gulf Insider January 2014

Meetup BH Events

Gulf Insider January 2014


Events Meetup BH In coordination with


Gulf Insider January 2014


THE ELITE GROUP January Promotions & Offers Elite Resort and Spa Paelleras Night Where: Al Noor Tent When: 730pm onwards Price: BD12 per person Thursday Night Grills Where: Waikiki When: 730pm onwards Price: BD12 per person Aqua Fiesta Where: Pool side When: Friday noon Price: BD12 for adults/BD6 for kids (6-12 years) Chill Out Saturday Where: Waikiki

When: 730pm onwards Price: BD9 net per person

For bookings call, Tel. +973 1731 3333

Elite Grande Hotel: Hot Grill night Where: H2O When: Every Thursday Price: BD10 net inclusive of shisha. Catch of the Day Where: H2O When: Every Saturday Price: BD10 net inclusive of shisha Festive Events ( Elite Grande Hotel)

For bookings call, Tel. +973 1756 5888

Elite Seef Residence & Hotel Elite Seef Residence & Hotel invites you to an Oasis of relaxation and indulgence through their luxurious privilege program. Membership includes a booklet of vouchers redeemable at any F&B outlet and hotel facility, and three free gym passes. As an Oasis Member, you also enjoy a 15 per cent discount on room rates, gym membership, spa treatments and any F&B bills in addition to special discounted rates on weekly themed events, and more. Sign up today and enjoy a year of Elite lifestyle privileges! Couples – BD 180, Single – BD 120. GFI

To register call, Tel. +973 17583388

Gulf Insider January 2014


Car News


Infiniti Q50

Just over a month since its regional debut at the Dubai International Motor Show, Sport Auto, one of the Middle East’s leading automotive magazines, has named the Infiniti Q50 as its 2013 ‘Car of the Year’.

New Chery E5

The Chinese car maker Chery Automobile revealed the first E series in Bahrain with its E5 model. The new vehicle was officially launched by Motorcity. Dr. Bijan Majidi, General Manger of Motorcity stated: “The E5 is the all new generation Chery mid-size sedan that maximizes handling and comfort, and is equipped with a high performance engine and is one of the widest and roomiest car in its category. The new E5 Model Year 14 will be offered with 5 years or 150,000 Km warranty with a starting price of BD 4,300.”

Bentley introduces New Mulsanne Shaheen

The Bentley Mulsanne Shaheen, a vehicle specifically created for the Middle East market, made its debut at the Dubai Motor Show. The new luxury flagship model draws its inspiration from the Shaheen eagle, a bird of prey that is embedded in Middle Eastern culture and society.

M6 Gran Coupé highlights BMW’s technology

Fans of high performance motoring were treated to a line-up of BMW M model vehicles at the Bahrain International Motor Show 2013. Headlining the event was the recently launched BMW M6 Gran Coupé, followed by the BMW M5, M6 Coupé, X6 M, X5 and the 453i Coupé with the M Performance package. Paul Yates, General M a n a g e r of Euro Motors, said: “BMW’s M division has long been revered in the automotive industry for sports and high performance vehicles. The popularity and excitement e to g a p w Turn of our M models continues to grow and driving a car e i v e ur r boasting the M logo remains an exclusive experience. read o ast!

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of thi


Gulf Insider January 2014

News Car

New Nissan Tiida Wins Award for ‘Best Budget Hatchback’

Toyota 86 track drives

Ebrahim K. Kanoo showed off the Lexus LF-CC (Lexus Future Captivating Coupe) two-door coupe concept at the Bahrain Motor Show, giving a glimpse on how the Lexus RC and RCF will look like when they will be launched in Bahrain in October 2014.

Nissan Tiida won the ‘Car & Driver Magazine’ Best Budget Hatchback Of The Year Award for 2013. Mr. Samir Cherfan, Managing Director, Nissan Middle East, described the award as the result of another highly innovative approach in a very competitive sector. “In a segment that has so many excellent products, it is even more gratifying to be recognised as the leading model.

Middle East Debut for Jaguar C-X17

Jaguar revealed its C-X17 Sports Crossover Concept at the Dubai International Motor Show to showcase the company’s future nextgeneration lightweight technology and performance technology and engineering. Production of a premium mid-sized sports sedan for Jaguar is scheduled to commence in 2015.

50 Years of the Porsche 911

To celebrate 50 years of production, Porsche created the most complete 911 to date - the new 911 Turbo Coupe. Boasting more power than ever, but with improved efficiency, the 911 3.8-litre twin-turbo engine delivers 520 hp at 6,000 – 6,500 rpm with maximum torque. The result is a top speed of 315 km/h and an acceleration from standing to 100 km/h in 3.4 seconds.

Gulf Insider January 2014


Car BMW M6


2014 BMW M6 GRAN COUPE Reviewed by Nick Cooksey


n case you don’t already know, when a BMW carries an “M” badge then it’s special. “M” stands for M-Technik, a division initially created to facilitate BMW’s racing program, and once upon a time, any BMW with an M badge was an out and out beast of a car, where sheer power and performance counted for everything and driving comfort was not a great consideration. But that has changed over the years as M have become a lot more comfort focused.


Gulf Insider January 2014

BMW M6 Car

This latest third generation M6 is equipped with an impressive sevenspeed dual-clutch automatic. Its engine, a twin-turbo 4.4 litre 560 horsepower V-8 noticeably more powerful than the V10 it replaces, will take you from Zero to 100 kph in just 4 seconds. The engine makes a powerful growl befitting its immense capabilities, but you don’t really hear it in all its glory when driving due to the car’s soundproofing. This is both a sports and a luxury car combined, and you wouldn’t know it weighs substantially over two tons with the ease and grace with which this car handles - it can be programmed for over 200 combinations of suspension, throttle, transmission, steering and traction settings. The M6 is a big car and looks impressive with its jet-fighter-like air intake, contoured headlight units, kidney grille bearing the “M6” badge, and 20 inch light-alloy wheels. From the back,

with its wide track, fat rear tires and four exhausts, it makes an aggressive statement. There’s every electric gadget and luxury you can think of. The cockpit instrument panel is cleanly laid out and the elegant dash surrounds you in the shape of an arc. The navigation is displayed on a wide 10.2-inch screen. There’s lots of room in the front but back seats are a very tight for space in both head and leg room. I found the console shifter a bit tricky to operate and put this down to the cars advanced technology, meaning a little bit of practice will make for superior results. Unfortunately I only had the M6 for the day so didn’t have enough time to really acquaint myself with its technological complexities. The M6 delivers race car performance while also being able to be driven comfortably under normal road conditions. It’s a beautifully put together automobile and its power is impressive,

The M6 delivers race car performance while also being able to be driven comfortably under normal road conditions. but I recommend anyone thinking about buying one to test it against the standard BMW 640 and compare as each highly impressive car has a noticeably different personality and ratios of power to comfort, so it would be wise to get to know both to be sure of owning the right car for your own individual preferences. GFI

To arrange a test drive in Bahrain contact EuroMotors on +973 1775 0750

The author of this article, Nick Cooksey, In addition to being publisher of Arabian Magazines is a jury panel member of the Middle East Motor Awards.

Gulf Insider January 2014


Fashion Salsa

Menswear collection themes – Raw Elegance, Contemporary & Luxury and Modesty Heritage – highlights prints and materials, with pieces inspired by neo-dandy, sporty or tailoring styling. The use of heavy fabrics, including denim and canvas, also rich wools, leather jackets provides the touch for a contemporary, vintage or raw elegant look.


Gulf Insider January 2014



Salsa Fashion

Salsa is available at: Bahrain City Centre +973 1717 2320 Gulf Insider January 2014


Art Photography Sponsored by


Organised by The Arabian Review


ome of the best shots in and around Bahrain submitted by participants of the DSLR and smartphone photography contest. As part of MeetUp Bahrain’s social media event, the top 20 photos were uploaded on Facebook and voted by fans. The winning entries were selected with 60% creativity and 40% Facebook likes. Batelco through their Youth Segment has given away latest Samsung and Sony smartphone devices for the top 3 winners. GFI

Top 10 Entries

DSLR 1st PRIZE ‘Abandonment’ By:Giovanni Olivar

DSLR Photography

DSLR 2nd PRIZE ‘Hidd Sh. Salman Park on a sunny evening’ By: Vinod V Chandran

By: Nabil Salam Khlfan Alsaqri 64

Gulf Insider January 2014

DSLR 3rd PRIZE ‘WRECK’ By: Glenn Wesley Dulay

By: Leanne Marshall

By: Dexter S. Garcia

Photography Art

SMARTPHONE 1st PRIZE ‘Al Ghous at Dusk’ By: Myra Villaruel-Garcia

By: Glenn Iway

By: Haidee Vaquer

By: Benjamin Medina

By: Jeffrey Cariaga

By: Jun Manabat SMARTPHONE 2nd PRIZE ‘Sunset at Al Ghous Park’ By: Rico Mendoza

Top 10 Entries SMARTPHONE Photography

By: John Samaniego

SMARTPHONE 3rd PRIZE ‘Tequilla Sunset’ By: Rowell Ainza Yu

By: Tosin Arowojolu

By: Ferlan Peralta

By: Dominic B. Emerenciana

By: Epefanio Pepito Jr.

By: Wowie Andalis Gulf Insider January 2014


Last word

WARREN BUFFETT: HIS BEST QUOTES Here we look at some of the wisdom of Billionaire investor Warren Buffett.

On success  “The business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective”  “You do things when the opportunities come along. I’ve had periods in my life when I’ve had a bundle of ideas come along, and I’ve had long dry spells. If I get an idea next week, I’ll do something. If not, I won’t do a damn thing”  “Can you really explain to a fish what it’s like to walk on land? One day on land is worth a thousand years of talking about it, and one day running a business has exactly the same kind of value”  “You only have to do a very few things right in your life so long as you don’t do too many things wrong”

On helping others  “If you’re in the luckiest 1pc of


Gulf Insider January 2014

humanity, you owe it to the rest of humanity to think about the other 99pc”  “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently”  “If I wanted to, I could hire 10,000 people to do nothing but paint my picture every day for the rest of my life. And the GNP would go up. But the utility of the product would be zilch, and I would be keeping those 10,000 people from doing AIDS research, or teaching, or nursing.”  ”There’s nothing material I want very much. And I’m going to give virtually all of those claim checks to charity when my wife and I die.”  “My family won’t receive huge amounts of my net worth. That doesn’t mean they’ll get nothing. My children have already received some money from me and will receive more. I believe in the philosophy that a very rich person should leave his kids enough to do anything but not enough to do nothing”.

On investing  “Rule No.1: Never lose money. Rule No.2: Never forget rule No.1”  “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price”  “Only buy something that you’d be perfectly happy to hold if the market shut down for 10 years”  “We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful”  “Why not invest your assets in the companies you really like? As Mae West said, “Too much of a good thing can be wonderful” GFI



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Gulf Insider January 2014  
Gulf Insider January 2014