Ain-Al-Yaqeen - January 6, 2006

		January 6, 2006

THE CUSTODIAN OF THE TWO HOLY MOSQUES LAUNCHES IN THE PRESENCE OF CROWN PRINCE SULTAN THE ECONOMIC CITY - THE LARGEST PROJECT OF ITS KIND ON THE SHORES OF THE RED SEA.
SHEIKH MOHAMED BIN RASHED: "THE IMPORTANCE IS THAT THIS PROJECT IS BETWEEN SAUDI AND EMIRATI BROTHERS AND NOT BETWEEN ONE COMPANY AND ANOTHER."
THE FOUNDATION WORKS FOR THE KING ABDULLAH ECONOMIC CITY STARTS.
$26.6 BILLION TO BE INVESTED IN THE PROJECT.

The Custodian of the Two Holy Mosques King Abdullah Ibn Abdul Aziz laid the foundation stone of an SR100 billion ($26.6 billion) King Abdullah Economic City that will come up in Rabegh, north of Jeddah, in what has been described as the biggest project of its kind in the Gulf region.

In what is considered the single largest private sector investment in Saudi Arabia, the announcement of the 'King Abdullah Economic City' to be built at a pristine location off the Red Sea in the north of Jeddah with an investment of SR100 billion ($26.6 billion), is a signal of the dawn of a new era of economic prosperity for the citizens of the Kingdom.

The project, which will be a New Age City being built today for tomorrow's generation of Saudi citizens, was officially launched by The Custodian of the Two Holy Mosques King Abdullah Ibn Abdul Aziz Al Saud in the presence of Crown Prince Sultan Ibn Abdul Aziz Al Saud, Minister of Defence and Aviation and Inspector General, and General Sheikh Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai and UAE Defence Minister and several dignitaries.

"The King Abdullah Economic City will be another jewel in the crown for Saudi Arabia and a shining example of what can be achieved for the common good when two brotherly nations get together for ever closer co-operation," said General Sheikh Mohammed. "I am certain that what will be achieved through this project will create its own chapter in the annals of the GCC."

The Custodian of the Two Holy Mosques and the audience watched a film on the city and replicas of the project.

Unveiling a memorial plaque and laying the foundation stone of the project, the King prayed to Almighty Allah it will be of great benefit for the Kingdom and Arabs.

The ceremony was also attended by Prince Miteb Ibn Abdul Aziz, Minister of Municipal and Rural Affairs; Prince Miqren Ibn Abdul Aziz, Chief of General Intelligence; princes; ministers and senior officials.

The 'King Abdullah Economic City' project was announced with an investment of SR100 billion ($26.6 billion). It is the largest private sector investment in Saudi Arabia.

At the opening ceremony General Sheikh Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai & UAE Defence Minister said: "The King Abdullah Economic City will be another jewel in the crown of Saudi Arabia and a shining example of what can be achieved for the common good when two brotherly nations get together for ever closer co-operation," said Sheikh Mohammed.

"This partnership is more than a project or two," said Sheikh Mohammed after the announcement. "The importance is that this project be between Saudi and Emirati brothers and not between one company and another."

When asked whether or not this project had anything to do with Saudi Arabia joining the WTO, Sheikh Mohammed said, "No doubt, but more importantly it has to do with King Abdullah's vision and support for the project, and I personally congratulate him."

The King Abdullah Economic City will be a multi-stage development with construction beginning on Wednesday, 21 December, 2005. This mega project will closely integrate itself into the Kingdom's on-going drive to expand the economy, create employment opportunities for its youthful population and function as a catalyst to attract foreign investment, global trade, commerce and industry. Based on initial forecasts, the project and its several components will create up to 500,000 employment opportunities in the various industries and service-oriented companies that will open in the City.

The City will be a mixed-use development located north of the commercial hub of Jeddah to ensure easy access from the Holy Cities of Makkah and Madina. A massive 55 million square metres of greenfield land with a 35 km shoreline close to the industrial city of Rabegh has been earmarked for the master development. The City will have six distinct components a modern world-class Seaport, Industrial District, Financial Island, Education Zone, Resorts and The Residential Area. Completion of the overall project will be done in stages with the first batch of businesses and residents moving into the City in a period of 24 to 36 months.

Emaar Properties, the world's largest real estate company in terms of market capitalisation, is the master developer of this ambitious project, the biggest outside of its home market of the UAE. SAGIA (Saudi Arabian General Investment Authority), the apex body responsible for inward investments into the Kingdom, is the prime facilitator for the development.

SAGIA's Investor Service Centre will facilitate the provision of services to potential investors. The Centre is SAGIA's "one-step" solution aimed at minimizing the number of formal steps associated with investment in the Kingdom.

Central to the mega project is the creation of a 2.6 million square metre new Millennium Seaport similar in size to the world's top 10 ports, such as Rotterdam, that would allow even the world's largest super vessels to drop anchor. With its strategic location on the Red Sea and the instant access to key cities within Saudi Arabia, the port will have a designated area for light industry and logistics and be a natural platform for onward movement of goods to Europe, Africa, Asia and beyond. The port will have an integrated transport system with seamless high speed transitions from sea to rail, road and air, making the City the main gateway to the central and eastern provinces as well as the entire Kingdom.

The port, with its close proximity to the two Holy Cities of Makkah and Madina, will have a dedicated Hajj terminal that can receive over 500,000 pilgrims every season. To cater to the pilgrims' every need, there will be adjoining hotels, medical centres and other world-class amenities.

The second component of the City The Industrial District will cover 8 million square metres, and is exclusive to the requirements of a range of manufacturers small, medium and large scale industry. They will represent sectors such as downstream petrochemicals, pharmaceuticals, research and development activities as well as a host of educational institutions that will prepare young Saudis for the jobs that the City will bring in. A sizeable area has also been set aside to develop accommodation for employees and their families.

The waterside Resort will serve up a most compelling mix of waterfront hotels and boutique residences. The master plan envisages 3,500 well-appointed hotel and residential bedrooms and suites, premium villas, plus an extensive retail element and an international-class signature 18-hole golf course and an equestrian club.

The fourth element of the City will be the Financial Island, conceived to be a 'city within a city' for financial institutions. The Island will offer 500,000 square metres of office space for the leading international and regional financial entities, business hotels and a new exhibition and convention centre. Up to 60,000 professionals are to operate from the Financial Island on a daily basis.

Financial Island will be topped by two towers reaching up to 100 and 60 storeys that offer compelling views of the surrounding city skyline.

Three residential districts form the fifth component of the new City. The first district wraps itself around a town centre, which will be a blend of the traditional and the modern. The second district will have a corniche as its main theme. It is in keeping with this concept that the district will 'curve' around a top-of-its-class marina and yacht club with 450 boat moorings. The souq and retail elements will contribute 350,000 square meters of prime space. Around 75,000 residents are expected to live here. The third district will be a secluded residential community set on an island on a choice water location.

The sixth component is the Education Zone which comprises of Universities, Schools and Research & Development Centres.

The project is jointly headed by Emaar from the UAE and Aseer (Aseer Company for Trade, Tourism, Industry, Agriculture, Real Estate and Construction) from Saudi Arabia. Other Saudi companies are participating in this initiative including Saudi Binladen Group. The company will offer 30% of the equity for an IPO in due course.

"It is no coincidence that the City is being formally launched, as Saudi Arabia has now become a part of the World Trade Organisation. The City is one of the most impressive projects Saudi Arabia has attempted in the New Millennium. The fact that we were able to move ahead with this project on a fast track basis shows that Saudi Arabia is moving ahead with confidence to transform the economy and build more sustainable prosperity for its citizens," commented His Excellency Mr. Amr Al-Dabbagh, SAGIA Governor.

He explained that this project will have a major role in attracting the Saudi and foreign investment and assured that all necessary licensing procedures will be done within one week of application in coordination with other concerned government departments.

Al-Dabbagh also stressed that the project will fulfil SAGIA's ambitious plans and it will help promote Saudi Arabia as an international investment destination while pushing forward the Saudi economy into a new phase of adapting international standards. The private sector involvement in this project will create huge job opportunities, with no additional cost on the Saudi government except for the services and facilities, which will be provided by SAGIA and other government departments.

"It is also in keeping with the spirit of co-operation that binds the fraternal countries of the GCC, that the City brings closer Saudi Arabia, the UAE and the Emirate of Dubai to work towards a common endeavour. SAGIA is proud to be part of this important milestone in the epoch-making moment for our Kingdom and the GCC," Al-Dabbagh said.

Mr. Mohamed Ali Alabbar, Emaar Chairman, said: "The six components - seaport, industrial district, education zone, financial island, resorts and the residential area - of the City - will work seamlessly together to make it an important global destination and a focus area for the development of both heavy and light industry, services in various sectors and bring in a greater level of local investment as well as regional and international Foreign Direct Investment into the Kingdom and thus more job opportunities for Saudi youth.

"This City which will be a world class location to work, live and play and a shining example for Saudi Arabia's transformation into a global economic powerhouse and further consolidate its position as the Middle East's largest economy."

"In the past decade, Emaar Properties has built experience and knowledge on how to transform the power of ideas into reality. The company is now honoured to be part of the great leap forward that brings together the peoples of Saudi Arabia and the UAE," Mr. Alabbar said.

"The King Abdullah Economic City with it six distinct components is a project whose time has come. It will add tremendous value to the on-going economic reform process driven by the Saudi Government and bring a host of opportunities aimed at the prosperity of Saudi citizens," Mr. Alabbar concluded.

Prior to the launch phase, SAGIA had taken a number of steps to ensure a successful launch of the biggest economic city in the Middle East, including a case study of similar examples such as Yanbu, Al-Jubail, Dubai, Ireland and Malaysia. Constructing a private sector financed economic city, is one of the successful strategies to achieve a regional, balanced and sustainable development. Cities have already been identified within a number of regions in Saudi Arabia to establish international, export-oriented industries including Hakkel (in the North West), Jazan (in the South), Ras Elzor (in the East), Rabegh (to the West), and Hayel (in Mid North).

A committee of international consultants was entrusted to study the economic feasibility of the project. With positive results, Rabegh city has been chosen because it already has major ongoing projects, a strategic location on the Red Sea close to international maritime routes, and instant access to key cities within Saudi Arabia (Makkah, Al Madina, Yanbu and Jeddah).

The development of these areas comes as one of the main six strategic roles for SAGIA which include the realization of balanced economic development for regions. This is hoped through the promotion of investments in sectors with a competitive advantage to help accelerate growth within the respective regions and in order to curb migration to larger cities. SAGIA's other five roles include:

1. Facilitation: SAGIA's promise to investors begins by providing comprehensive transactional support services that transcend licensing and extend through to the completion of a project and beyond.

2. Investor-to-Opportunity Matchmaking: Targeted and focused matchmaking defines SAGIA's marketing and promotion activities.

3. Special Incentives for Entrepreneurs: Feeding the leaves and branches of a healthy economy requires cultivating an entrepreneurial spirit. SAGIA does this by partnering with The Centennial Fund, a national, non-profit foundation dedicated to mentoring and funding Saudi entrepreneurs.

4. Dedicated Sector Services: SAGIA offers its comprehensive investment facilitation package to all investors seeking opportunities in any of the economy's open sectors. To maximize the Kingdom's competitive advantages and set the stage for further economic diversification, however, SAGIA dedicates sector-specific resources and services in Strategic Business Units.

5. Pro-Business Advocacy: Being competitive in the global economy means a business environment characterized by healthy practices, policies, and procedures.

Emaar Properties, the Dubai-based Public Joint Stock Company, is listed on the Dubai Financial Market and is part of the Dow Jones Arab Titans Index. Emaar is the No. 1 real estate company in the world in terms of market capitalization, which is over US$40 billion. The company recently announced that its net profits for the first nine months to September 30 climbed 255 per cent, to a record AED 3.690 billion. The figures represent a substantial increase on the AED 1.039 billion in the same period a year ago. The company also reported an impressive 77 per cent rise in revenues to AED 6.757 billion, from AED 3.808 billion for the same period in 2004.

The company has witnessed tremendous growth since its inception in 1997 and boasts a rapidly growing tenant base with more than 12,000 homes handed over to satisfied customers to date. Currently, it has several major real estate projects under various stages of development in Dubai including Arabian Ranches, Dubai Marina, Emirates Hills, The Views, The Meadows, The Springs, The Lakes and The Greens. The company also owns and manages the Gold and Diamond Park.

Emaar has started construction on its most ambitious project to date, the Burj Dubai Development, which comprises the Burj Dubai, The Dubai Mall, Burj Dubai Boulevard, The Lofts, The Old Town, The Old Town Island, The Residences, Burj Views, man-made lakes, landscaped parks and gardens. The company has joint ventures and projects across the region covering Saudi Arabia, Egypt, Syria, Jordan, Morocco, India and Pakistan. Recently the award winning property developer announced plans to aggressively expand the retail sector with investments of over AED 15 billion to develop approximately 100 malls in the mega emerging markets of the Middle East, North Africa and the Indian subcontinent. In addition, Emaar has teamed up with Giorgio Armani S.p.A to build and manage 10 Armani hotels and resorts across the world; the first Armani hotel will feature in Emaar's flagship Burj Dubai tower the tallest in the world when completed in 2008.

While continuing to actively pursue expansion in its core business of innovative, high quality real estate development, Emaar has diversified into related business lines to further build value for its 41,000 shareholders, which includes the Government of Dubai. Emaar owns and manages two subsidiaries Dubai Bank, focused on retail and commercial banking and EMRILL, a joint venture with the UK-based Carillion which provides innovative property and facilities management services. Emaar is also the majority shareholder in Amlak Finance, UAE's leading Islamic home financing company.

Saudi Arabian General Investment Authority (SAGIA) is a service entity aiming to provide services and facilities to promote investment and economic development in the Kingdom of Saudi Arabia (KSA). SAGIA was established in April 2000 under the directives of the Supreme Economic Council (SEC) as a catalyst to promote inward investments, facilitate exchange of best practice between the public and private sectors, as well as act as an intermediary between the global business community and the Saudi Government and its ministries and agencies. It also aims to contribute to economic policy-making substantiated by research and strategic criteria.

SAGIA's role is complementary and supportive to the bodies directly concerned with the various investment sectors and working to finalize the investors' procedures. The mission of SAGIA is to create a pro-business environment while providing comprehensive services to investors, and fostering investment opportunities in energy, transportation and knowledge-based industries.