Custodian of the Two Holy Mosques to patronize Jamaah and Imamah conference

Prince Khalid al-Faisal signs contracts of 12 projects to discharge torrential rains in Jeddah

King of Sweden receives invitation to attend world peace camp

Saudi Arabia topped the ladder with the flow of foreign direct investment (FDI) rising to $32 billion in 2010 compared with $28 billion a previous year, according to the World Investment Report 2011.

Launching the report in Manama, Nazha Benabbes, head of the UN Conference on Trade and Development (UNCTAD), said the first half had recorded a good year in terms of economic development.

In her presentation, she said some GCC countries had also witnessed a significant drop in the flow of FDIs, for example, Kuwait’s FDIs slipped to $1.2 billion in 2010 from $8.5 billion in 2009. Similarly, Qatar’s FDIs witnessed a record drop $11.6 in 2009 to $1.9 billion in 2010.

The UAE also saw a significant drop from a record FDIs of $2.7 billion in 2009 to $2 billion in 2010.

The report, subtitled “Non-Equity Modes of International Production and Development,” was released this week in Bahrain.

Nazha also highlighted the importance using non-equity modes to simulate the regional economies.

FDI flows to West Asia in 2010 continued to be affected by the global economic crisis, decreasing by 12 percent to $58 billion, despite the steady economic recovery registered in 2010 in most of economies of the region, says UNCTAD’s World Investment Report 20111 (WIR11).

While the recovery was underpinned by sizeable increases in oil-rich government spending, private investors’ response remained cautious, the annual survey reports.

The estimated value of greenfield FDI fell 42 percent in 2009 and 44 percent in 2010.

Sales of cross-border mergers and acquisitions (M&A) were concentrated mainly in Turkey. Although they increased by 30 percent in 2010, they remained at a low level at $4.6 billion as the privatization process in that country came to an end.

Trends in FDI inflows in 2010 varied by country. For example, they dropped 12 percent in Saudi Arabia, where foreign investors have withdrawn from or frozen their involvement in a number of mega projects in the petrochemical industry such as ConocoPhillips in the Yanbu project and Dow Chemicals in the Ras Tanura integrated project. They fell 32 percent in Qatar, as the last of four liquid natural gas Qatargas plants that had bolstered FDI in 2009 was completed in 2010.

In the UAE, flows stayed at the same low level as in 2009 — when they plummeted to $4 billion due to the economic crisis.

In Turkey, incoming FDI increased by 8 percent mainly as a result of a 40 percent increase in investment in real estate.

The report says that, according to preliminary data, FDI inflows are likely to bottom out in 2011. However, concerns about political instability in the region are likely to weigh on the recovery.

FDI outflows from West Asian economies declined significantly for the second consecutive year.

They dropped 51 percent in 2010 due to divestments by West Asian firms. The largest such disinvestment was the $10.7 billion sale by Zain Group (Kuwait) of its African operations to Bharti Airtel (India). At the same time, the estimated value of West Asian greenfield projects abroad dropped 52 percent.

As the region’s outward investment is driven mainly by government-controlled entities, the global economic crisis and political unrest are affecting outward investment by putting pressure on governments to direct more investment into their own economies and to finance higher social spending to pre-empt or respond to popular discontent.

Hitherto, however, governments of these countries have had a dual strategy for economic diversification policies that included investing in other Arab countries to compensate for the small size of their domestic economies, and in developed countries and emerging economies to improve or create capabilities in industries perceived as strategic for the development and diversification of their home economies.

Increasingly, the latter strategy has been pursued in the industries still missing at home, such as motor vehicles, alternative energy, electronics and aerospace.

This approach differs from the experiences of other countries that have generally sought to develop a certain level of capacity at home before engaging in outward FDI, the report says.

Long-term prospects for outward investment are positive on the whole, as expected high oil prices suggest that funds available for investment abroad will continue to rise.

It is important, however, that governments of the region assess the performance and effectiveness of all aspects of their outward FDI strategies as an instrument for economic diversification and development, the study says.

Meanwhile, Prince Khalid al-Faisal, Governor of Makkah, said that Jeddah tunnels are prepared to contain 25 mm of water not massive quantities like what happened recently.

Prince Khalid explained that there are 50 slums in Jeddah and 60 in Mecca considering that sewerage system covered only 10% of Jeddah areas with old and dilapidated network.

He expressed his dissatisfaction with slowness in projects accomplishment and dependence upon sub-contractors.

He said that there are a project and a committee established by Prince Naif Bin Abdulaziz which put some suggestions to develop those slums; referring to two slums in Jeddah and one in Mecca. He said the expropriated lands will be the torrents watercourse and their owners will be compensated.

His Highness said that those new projects in Jeddah are establishing nowadays, and he would form a department for each project to deal with media means transparently considering the slums centers created by H.H. Prince Abdulmajeed Bin Abdulaziz (God Bless His Soul).

Meanwhile, King Karl Gustav XVI of Sweden received Prince Faisal bin Abdullah bin Mohammed, Minister of Education and the President of Saudi Scout Association, currently visiting Sweden to take part in the 22nd world scout jamboree.

During the reception, the Prince handed an invitation of Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz Al Saud to the Swedish monarch to attend the opening ceremony of the second world peace camp to be hosted by the Kingdom of Saudi Arabia next year, at King Abdullah University for Science and Technology (KAUST).

The reception was attended by Swedish Queen Silvia, Saudi Ambassador to Sweden Dr. Abdulrahman bin Mohammed Al-Jidaie and Deputy President of Saudi Scout Association Dr. Abdullah bin Suleiman Al-Fahd.

Saudi Ambassador to Sweden Dr. Abdulrahman bin Mohammed Al-Jidaie said that the 'Peace Messengers' initiative launched by the Custodian of the Two Holy Mosques has dramatically contributed to enhancing humanitarian communication, development of societies, spread of understanding spirit and tolerance and building of bridges between the world's different cultures in a way that serves peace in the world and opens new horizons for human communities to contact with each other.

In a statement to the Saudi Press Agency on the occasion of Saudi participation in the world 22nd scout jamboree, ongoing in Sweden until August 7, the ambassador said the noble initiative received admiration of King Karl Gustav XVI of Sweden.