Surging oil prices are likely to come under scrutiny at the World Economic Forum in Davos this week as politicians and business leaders gather at the Swiss ski resort to discuss the fallout of a commodities boom.
An increase in crude prices has led to progressively more upbeat outlooks for GCC economies in recent months. For consumer countries, however, the surge could pose risks for the sustainability of economic expansion, say economists.
"It's a concern for oil consumers," said Dr Giyas Gokkent, the chief economist for National Bank of Abu Dhabi. "And from a producer's point of view you've got to strike a balance as you don't want to kill the goose that laid the golden egg."
Prices of European Brent have sailed close to US$100 a barrel recently, prompting some analysts to raise their forecasts for the year ahead. Brent crude on London's ICE Futures exchange rose to $98.11 yesterday.
Participants at forum's annual meeting, which opens tomorrow, will be keen to discuss the commodity's future prospects.
Big names such as Khalid al Falih, the president and chief executive of Saudi Aramco, and energy ministers from the Gulf will be among regional oil players rubbing shoulders with officials from the principal consuming nations such as China.
Oil's price rise comes against a backdrop of rising price pressures in other commodities such as food.
Unlike oil, increases in basic staples have economic concerns for the Gulf, a region that imports about 85 per cent of its requirements. Global food prices rose to a record high last month, the latest data from the UN Food and Agriculture Organisation shows.
Recent floods in producers such as Australia, Brazil and India have already contributed to pushing up prices for consumers in UAE shops, traders say.
People across much of the Arab world from Tunisia to Yemen have also taken to the streets to protest against soaring food bills.
"Food price inflation and food security is a growing concern for the region because of structural price pressure from China," said Jarmo Kotilaine, the chief economist of NCB in Saudi Arabia.
Globally, a focus of the 2,500 people attending the five-day event in Davos are likely to be on a gradual shifting of the balance of power from the developed world to emerging markets. Nimble economies such as China, India and Brazil are outflanking a more sluggish US and Europe.
Talk may surround how to build a financial architecture better at reflecting a changing global economy. France and India have both proposed reforming the international monetary system.
Debate over the US dollar's status as a reserve currency intensified after a year of volatility in currencies. Any change would have implications for the GCC, with five of the six regional states linking their currencies to the dollar.
"Discussions will be about the role of the US and China," said John Sfakianakis, the chief economist of Banque Saudi Fransi. "But the dollar is here to stay as the currency reserve; there are no viable alternatives."
Sovereign debt problems in Greece dominated the headlines during Davos last year. This year Portugal is likely to be the focus of worries about the EU. But despite continuing woes in the euro zone, some economists anticipate a more optimistic feel to meetings in the mountain resort this year.
"Attendants will be keen to move away from the crisis conditions and introspection of the last two years and be more expansive about the opportunities that lie ahead," said Tim Fox, the chief economist of Emirates NBD.
tarnold@thenational.ae
England squads for Test and T20 series against New Zealand
Test squad: Joe Root (capt), Jofra Archer, Stuart Broad, Rory Burns, Jos Buttler, Zak Crawley, Sam Curran, Joe Denly, Jack Leach, Saqib Mahmood, Matthew Parkinson, Ollie Pope, Dominic Sibley, Ben Stokes, Chris Woakes
T20 squad: Eoin Morgan (capt), Jonny Bairstow, Tom Banton, Sam Billings, Pat Brown, Sam Curran, Tom Curran, Joe Denly, Lewis Gregory, Chris Jordan, Saqib Mahmood, Dawid Malan, Matt Parkinson, Adil Rashid, James Vince
The Two Popes
Director: Fernando Meirelles
Stars: Anthony Hopkins, Jonathan Pryce
Four out of five stars
Stamp duty timeline
December 2014: Former UK finance minister George Osbourne reforms stamp duty, replacing the slab system with a blended rate scheme, with the top rate increasing to 12 per cent from 10 per cent:
Up to £125,000 - 0%; £125,000 to £250,000 – 2%; £250,000 to £925,000 – 5%; £925,000 to £1.5m: 10%; Over £1.5m – 12%
April 2016: New 3% surcharge applied to any buy-to-let properties or additional homes purchased.
July 2020: Rishi Sunak unveils SDLT holiday, with no tax to pay on the first £500,000, with buyers saving up to £15,000.
March 2021: Mr Sunak decides the fate of SDLT holiday at his March 3 budget, with expectations he will extend the perk unti June.
April 2021: 2% SDLT surcharge added to property transactions made by overseas buyers.
Frankenstein in Baghdad
Ahmed Saadawi
Penguin Press
Credits
Produced by: Colour Yellow Productions and Eros Now
Director: Mudassar Aziz
Cast: Sonakshi Sinha, Jimmy Sheirgill, Jassi Gill, Piyush Mishra, Diana Penty, Aparshakti Khurrana
Star rating: 2.5/5
COMPANY PROFILE
Name: Lamsa
Founder: Badr Ward
Launched: 2014
Employees: 60
Based: Abu Dhabi
Sector: EdTech
Funding to date: $15 million
World Cup final
Who: France v Croatia
When: Sunday, July 15, 7pm (UAE)
TV: Game will be shown live on BeIN Sports for viewers in the Mena region
The specs: 2019 Subaru Forester
Price, base: Dh105,900 (Premium); Dh115,900 (Sport)
Engine: 2.5-litre four-cylinder
Transmission: Continuously variable transmission
Power: 182hp @ 5,800rpm
Torque: 239Nm @ 4,400rpm
Fuel economy, combined: 8.1L / 100km (estimated)
MATCH INFO
Qalandars 112-4 (10 ovs)
Banton 53 no
Northern Warriors 46 all out (9 ovs)
Kumara 3-10, Garton 3-10, Jordan 2-2, Prasanna 2-7
Qalandars win by six wickets
ARM%20IPO%20DETAILS
%3Cp%3E%3Cstrong%3EShare%20price%3A%3C%2Fstrong%3E%20Undisclosed%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ETarget%20raise%3A%3C%2Fstrong%3E%20%248%20billion%20to%20%2410%20billion%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EProjected%20valuation%3A%3C%2Fstrong%3E%20%2460%20billion%20to%20%2470%20billion%20(Source%3A%20Bloomberg)%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ELead%20underwriters%3A%3C%2Fstrong%3E%20Barclays%2C%20Goldman%20Sachs%20Group%2C%20JPMorgan%20Chase%20and%20Mizuho%20Financial%20Group%3C%2Fp%3E%0A
Thanksgiving meals to try
World Cut Steakhouse, Habtoor Palace Hotel, Dubai. On Thursday evening, head chef Diego Solis will be serving a high-end sounding four-course meal that features chestnut veloute with smoked duck breast, turkey roulade accompanied by winter vegetables and foie gras and pecan pie, cranberry compote and popcorn ice cream.
Jones the Grocer, various locations across the UAE. Jones’s take-home holiday menu delivers on the favourites: whole roast turkeys, an array of accompaniments (duck fat roast potatoes, sausages wrapped in beef bacon, honey-glazed parsnips and carrots) and more, as well as festive food platters, canapes and both apple and pumpkin pies.
Ruth’s Chris Steakhouse, The Address Hotel, Dubai. This New Orleans-style restaurant is keen to take the stress out of entertaining, so until December 25 you can order a full seasonal meal from its Takeaway Turkey Feast menu, which features turkey, homemade gravy and a selection of sides – think green beans with almond flakes, roasted Brussels sprouts, sweet potato casserole and bread stuffing – to pick up and eat at home.
The Mattar Farm Kitchen, Dubai. From now until Christmas, Hattem Mattar and his team will be producing game- changing smoked turkeys that you can enjoy at home over the festive period.
Nolu’s, The Galleria Mall, Maryah Island Abu Dhabi. With much of the menu focused on a California inspired “farm to table” approach (with Afghani influence), it only seems right that Nolu’s will be serving their take on the Thanksgiving spread, with a brunch at the Downtown location from 12pm to 4pm on Friday.
THE TWIN BIO
Their favourite city: Dubai
Their favourite food: Khaleeji
Their favourite past-time : walking on the beach
Their favorite quote: ‘we rise by lifting others’ by Robert Ingersoll
Cultural fiesta
What: The Al Burda Festival
When: November 14 (from 10am)
Where: Warehouse421, Abu Dhabi
The Al Burda Festival is a celebration of Islamic art and culture, featuring talks, performances and exhibitions. Organised by the Ministry of Culture and Knowledge Development, this one-day event opens with a session on the future of Islamic art. With this in mind, it is followed by a number of workshops and “masterclass” sessions in everything from calligraphy and typography to geometry and the origins of Islamic design. There will also be discussions on subjects including ‘Who is the Audience for Islamic Art?’ and ‘New Markets for Islamic Design.’ A live performance from Kuwaiti guitarist Yousif Yaseen should be one of the highlights of the day.
Results
1. New Zealand Daniel Meech – Fine (name of horse), Richard Gardner – Calisto, Bruce Goodin - Backatorps Danny V, Samantha McIntosh – Check In. Team total First round: 200.22; Second round: 201.75 – Penalties 12 (jump-off 40.16 seconds) Prize €64,000
2. Ireland Cameron Hanley – Aiyetoro, David Simpson – Keoki, Paul Kennedy – Cartown Danger Mouse, Shane Breen – Laith. Team total 200.25/202.84 – P 12 (jump-off 51.79 – P17) Prize €40,000
3. Italy Luca Maria Moneta – Connery, Luca Coata – Crandessa, Simone Coata – Dardonge, Natale Chiaudani – Almero. Team total 130.82/198.-4 – P20. Prize €32,000
Abaya trends
The utilitarian robe held dear by Arab women is undergoing a change that reveals it as an elegant and graceful garment available in a range of colours and fabrics, while retaining its traditional appeal.
