10 February 2009

* Kuwait to fall into recession predicts Standard Chartered

Kuwait’s economy will fall into recession this year, a senior economist at Standard Chartered has warned.

Marios Maratheftis, the bank’s regional head of research, said that Kuwait would be likely to cut government spending this year, while other Gulf states had announced expansionary budgets.

“This is not the right time to be reducing spending,” said Maratheftis.

“It just pushes the economy further down into a recession. I do not expect to see any growth for the full year in Kuwait. I expect to see a recession in Kuwait during the first half of the year.”
Maratheftis warned that policy in the UAE had also become pro-cyclical amid the global financial crisis.

“I think liquidity is way too tight and market interest rates are extremely high,” he said.

By contrast, he praised the measures taken by Saudi Arabia and said he expected the country to avoid a recession in 2009 and “exhibit decent, positive rates of growth”.

Last year, “hot money” flowed into GCC states as investors bet on a revaluation of dollar pegs and continued high oil prices.

But once the global environment changed, these flows rapidly reversed, leaving banks that had lent out this money long-term hugely overleveraged.

However, banks in Saudi Arabia were prevented from using these short-term speculative flows to hand out long-term loans, Maratheftis explained.

“The authorities were very conservative and they placed strong controls on their banking sectors and they were not tolerating banks taking short money and lending out long,” he said.

“As a result, I think the banking sector in Saudi Arabia is in a very good situation.”

In addition, Saudi has announced an expansionary budget for 2009 “which is exactly what the economy needs”.  

(arabianbusiness)



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Lebanon Time-Line

Introducing Lebanon

Coolly combining the ancient with the ultramodern, Lebanon is one of the most captivating countries in the Middle East. From the Phoenician findings of Tyre (Sour) and Roman Baalbek's tremendous temple to Beirut's BO18 and Bernard Khoury's modern movement, the span of Lebanon's history leaves many visitors spinning. Tripoli (Trablous) is considered to have the best souk in the country and is famous for its Mamluk architecture. It's well equipped with a taste of modernity as well; Jounieh, formerly a sleepy fishing village, is a town alive with nightclubs and glitz on summer weekends.

With all of the Middle East's best bits - warm and welcoming people, mind-blowing history and considerable culture, Lebanon is also the antithesis of many people's imaginings of the Middle East: mostly mountainous with skiing to boot, it's also laid-back, liberal and fun. While Beirut is fast becoming the region's party place, Lebanon is working hard to recapture its crown as the 'Paris of the Orient'.

The rejuvenation of the Beirut Central District is one of the largest, most ambitious urban redevelopment projects ever undertaken. Travellers will find the excitement surrounding this and other developments and designs palpable - and very infectious.

Finally, Lebanon's cuisine is considered the richest of the region. From hummus to hommard (lobster), you'll dine like a king. With legendary sights, hospitality, food and nightlife, what more could a traveller want?

Introducing Beirut

What Beirut is depends entirely on where you are. If you’re gazing at the beautifully reconstructed colonial relics and mosques of central Beirut’s Downtown, the city is a triumph of rejuvenation over disaster.

If you’re in the young, vibrant neighbourhoods of Gemmayzeh or Achrafiye, Beirut is about living for the moment: partying, eating and drinking as if there’s no tomorrow. If you’re standing in the shadow of buildings still peppered with bullet holes, or walking the Green Line with an elderly resident, it’s a city of bitter memories and a dark past. If you’re with Beirut’s Armenians, Beirut is about salvation; if you’re with its handful of Jews, it’s about hiding your true identity. Here you’ll find the freest gay scene in the Arab Middle East, yet homosexuality is still illegal. If you’re in one of Beirut’s southern refugee camps, Beirut is about sorrow and displacement; other southern districts are considered a base for paramilitary operations and south Beirut is home to infamous Hezbollah secretary general, Hassan Nasrallah. For some, it’s a city of fear; for others, freedom.

Throw in maniacal drivers, air pollution from old, smoking Mercedes taxis, world-class universities, bars to rival Soho and coffee thicker than mud, political demonstrations, and swimming pools awash with more silicone than Miami. Add people so friendly you’ll swear it can’t be true, a political situation existing on a knife-edge, internationally renowned museums and gallery openings that continue in the face of explosions, assassinations and power cuts, and you’ll find that you’ve never experienced a capital city quite so alive and kicking – despite its frequent volatility.