http://www.aawsat.com/english Asharq Alawsat English Edition is your insight into the Middle East en-us © 2012 Saudi Research and Publishing Wed, 26 Feb 2013 13:43:12 GMT 1 http://www.aawsat.com/english http://www.aawsat.com/english/images/aaaeng.gif 144 33 Asharq-e delivers up-to-the-minute news and information on the latest stories, weather, entertainment, politics in the Middle East http://www.asharq-e.com/news.asp?section=6&id=32989 DUBAI, (Reuters) - Iran is to reduce its dependence on oil income and boost non-oil exports in its budget to counter the "heavy" impact of sanctions, President Mahmoud Ahmadinejad said in a television interview late on Saturday. The budget is due to be presented to parliament on Wednesday for debate and likely amendments before it is subject to a parliamentary vote in the run up to Iran's election in June that will take place against the backdrop of deep economic gloom. "Events have struck from beyond our own economy and heavy factors are active from outside. If severe fluctuations hit this (oil) income, surely it has an effect," Fars news reported Ahmadinejad as saying, in an apparent reference to sanctions that have nearly halved Iran's oil exports. "We have to go in a direction to reduce oil receipts in our economy and raise other incomes such as non-oil exports that are increasing rapidly," he said. Over the past year Iran's economy has borne the brunt of tough sanctions against its oil and banking sectors imposed by the United States and its allies over Tehran's disputed nuclear activities. The West suspects Iran is trying to develop a nuclear weapons capability. Tehran says its programme is peaceful. The International Energy Agency estimated last week that Iran's oil exports may have dropped below 1 million barrels per day in January from 2.2 million bpd in late 2011, costing the country over $40 billion in reduced revenues last year. The financial pressures have resulted in soaring inflation and employment, dented production and brought investment to a standstill. Iran's government has sought to impose cuts to its spending by drastically reducing access by businesses and individuals to its generous foreign exchange sales rates and banned the import of luxury items to stem the flow of hard currency abroad. Access to hard currency has also been curtailed since major crude oil customer India is no longer been able to pay for nearly half of its shipments in euros because of the sanctions. But Ahmadinejad said non-oil exports coupled with its technical and engineering services could reach 75 billion dollars in the coming year, a 50 percent rise compared to estimated figures for this year that ends on March 19. Iranian officials say such exports comprise gas condensate, chemical products, cement, vehicles, agricultural produce as well as nuts and fruit. As with previous budgets, the process is unlikely to be concluded before the start of the next Persian year, less than a month away, and may drag on for several more months. It is also likely to be hampered by the deep political divisions between the president and a mainly hostile parliament who accuse him of reckless financial management that they see as the major cause of Iran's economic pain. Mon, 24 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32982 WASHINGTON/SEATTLE, (Reuters) - Boeing Co on Friday gave U.S. aviation regulators its plan to fix the volatile battery aboard its new 787 Dreamliner, even though investigators have not yet determined what caused the batteries to overheat on two planes last month. Boeing did not propose abandoning the lithium-ion batteries and is not working on a backup or longer-term fix for the problem that has grounded its entire fleet of 50 Dreamliners for nearly five weeks, three sources familiar with the plan said. The company and the U.S. Federal Aviation Administration said no firm result emerged from the meeting between Deputy Transportation Secretary John Porcari, FAA Administrator Michael Huerta and other FAA officials and Boeing Commercial Airplanes CEO Ray Conner and other senior Boeing executives in Washington. With Boeing's costs mounting by millions of dollars a day while the planes are on the ground, the FAA said it is "reviewing a Boeing proposal and will analyze it closely. The safety of the flying public is our top priority and we won't allow the 787 to return to commercial service until we're confident that any proposed solution has addressed the battery failure risks." Boeing declined to comment on the details of its proposal, but said the meeting with the FAA was productive. The proposal to the FAA includes measures to address a range of possible causes of short-circuits in the batteries, the sources said. Five weeks ago, U.S. authorities grounded the worldwide fleet of 787s. U.S., Japanese and French investigators are still not certain what caused the battery fire aboard an All Nippon Airways 787 in Boston and an overheated, smoking battery on a Japan Airlines 787 in Japan. The proposed fix includes adding ceramic insulation between the cells of the battery to help keep cells cool and prevent a "thermal runaway" in which one cell overheats and triggers overheating in adjacent cells. It also includes building a stronger, larger stainless steel box with a venting tube to contain a fire and expel fumes outside the aircraft should a battery catch fire again, the sources said. In addition, the plan proposed wiring changes, self-torquing screws that will not come loose and battery alterations to prevent moisture and vibration problems, one of the sources said. But there was also a plan to use a different battery type or some other longer-term fix, the sources said. "I have talked to a number of people who are working directly on these batteries. No one is on the Plan-B team," said a person familiar with Boeing's efforts who was not authorized to speak publicly about them. A second source, who also was not authorized to speak publicly, said Boeing does not view its proposal as a temporary "band-aid" that would be supplanted by another solution later. Boeing spokesman Marc Birtel said in a statement: "We are encouraged by the progress being made toward resolving the issue and returning the 787 to flight for our customers and their passengers around the world." Birtel reiterated that hundreds of engineers and technical experts are working "around the clock" to return the 787 fleet to service. "Everyone is working to get to the answer as quickly as possible and good progress is being made," Birtel said. Boeing's stock closed up 65 cents, or 0.86 percent, at $75.66 on the New York Stock Exchange. Richard Aboulafia, aerospace analyst with the Teal Group in Virginia, said Boeing needed a backup plan in case the FAA did not approve its proposal. "It's a bit tone deaf to propose containment and management when the political winds are favoring an elimination of the risk," he said, citing Transportation Secretary Ray LaHood's insistence that the plane would return to flight only when it was "1,000 percent safe" and similar remarks by other officials. "They need to be out there talking about a bigger solution beyond mere containment because the political winds and public opinion are not going to favor a solution that's focused on fire and smoke management," Aboulafia said. He noted that Airbus had already signaled its plan to switch back to more traditional nickel cadmium batteries for its A350 airliner, but the 787 was far more dependent on electrical power, which would complicate any effort to switch to a different type of battery. A complete redesign could take around nine months to implement, he said. Another source said that kind of solution could take two years if, for example, Boeing decided to use nickel cadmium batteries on the 787, similar to those used on the 777 jet. The U.S. National Transportation Safety Board is still investigating the Boston fire and the Japan Transportation Safety Board is investigating the battery failure in Japan. Neither has found a root cause for the problems. The sources said the NTSB might never find the cause because the battery in Boston was severely damaged by the fire. Given the financial cost of the grounding for Boeing and the airlines that own the jets, estimated at $200 million a month, Boeing decided to address all possible causes with the measures, rather than wait for the NTSB to identify one specific cause, the sources said. Boeing engineers have been working with outside experts and U.S. government officials to address possible cause of the battery issues. The team includes experts from the U.S. Navy and the National Aeronautics and Space Administration, which uses a lithium-ion battery on board the International Space Station. Boeing engineers went through a "fault tree" and "came up with a list of half a dozen things that could have led to problems," said a congressional source who had been briefed on the matter, but was not authorized to speak publicly. "They have a list of things that it could be, and the fixes are designed to address that list of problems," the source said. If the NTSB's investigation turns up additional possible causes, those would be added to the mix, another of the sources said. Boeing machinists already are building the new containment boxes for the battery, a sign the company is confident that the FAA will eventually approve continued used of lithium batteries and the contain-and-vent strategy for dealing with fires, according to a person familiar with the matter. The FAA granted Boeing permission to use lithium batteries in 2007, but set nine special conditions the company had to meet. Asked why the company's extensive testing of the batteries had not revealed problems with the batteries and the electrical systems used to operate them, one of the sources said test environments had limitations and the real test of an aircraft always came when it was actually operating. If the Boeing plan is approved by FAA Administrator Huerta and Transportation Secretary LaHood, company officials expect the 787 fleet to return to service within eight weeks, one source said. Another source, who is also familiar with the 787 investigation but not authorized to speak publicly, said a key challenge for Boeing would be to redesign the battery box so that it could truly contain a fire if one occurred. Despite Boeing's statements about containment being the plan for a battery issue from the start, the blue box that held the current lithium-ion battery was clearly "not designed to contain a fire," said the source. Another person familiar with the engineering work said the new box would be made of stainless steel nearly half an inch thick. It would be capable of containing an explosion, and would have a tube to vent smoke and flame outside the jet. However, the source said engineers have raised questions about the safety of venting flames outside the plane, especially if it is on the ground and being fueled. The effect could be something like a flamethrower, this person said. Sun, 23 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32941 CAIRO, (Reuters) - The Egyptian pound will not collapse and its incremental depreciation has stabilised, a senior aide to Islamist President Mohamed Mursi said on Sunday. Essam Haddad, Mursi's deputy chief of staff and foreign policy adviser, told Reuters in an interview that he did not expect the pound to fall further after it lost more than 8 percent against the dollar since the start of the year. "I think it has reached a level of stability," he said. "So as long as it (depreciation) is going incrementally and in a way that is market sensitive, then there is no harm in this," Haddad said. "What we have to be very careful of is to (avoid) a drastic change, or a complete fall or collapse. And this is something we are not seeing in the foreseeable future and we hope that it will recover." A black market in hard currency has sprung up in recent weeks due to a shortage of dollars, with street traders quoting the pound at more than 7 to the dollar compared to an official rate of 6.73. Regulated foreign exchange bureaux are swamped by demand for dollars and cannot meet the demand, the head of the foreign exchange department at the Chambers of Commerce said. A senior business leader affiliated with the ruling Muslim Brotherhood, Hassan Malek, told Reuters in an interview that people expected further devaluation of the pound. "I'm not, of course, a technical (expert) but people expect a little bit of devaluation in the future," he said when asked whether he expected a further depreciation of the currency to help exports and tourism. He said the economy was going through a very difficult period because the transition to democracy launched by the 2011 uprising that toppled former President Hosni Mubarak was not yet complete and institutions were not working fully. Asked about such concerns, Haddad said: "When the situation starts to stabilise more on the political side, I believe the Egyptian pound will be even stronger." There had been calls from the business community to change the exchange rate to boost the economy by improving exports and making Egypt more attractive for foreign investors, and those changes had now occurred, he said. "Market forces will act on this and decide what is the best value for the Egyptian pound," Haddad added. Tue, 18 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32936 Developer Nakheel is in talks to extend 8 billion dirhams ($2.18 billion) in loans due in 2015, the indebted company's chairman was quoted as saying in a local newspaper on Sunday. Ali Rashid Lootah dismissed concerns over Nakheel's ability to repay its debts, which also include a 3.8-billion dirham sukuk, or Islamic bond, due in August 2016, Abu Dhabi-based newspaper, The National, reported. The government-owned builder agreed a $16 billion debt restructuring in 2011 and has scaled back grandiose plans such as building a one-kilometer high tower after becoming a high profile corporate casualty of the Dubai property crash. Debts held by Nakheel, owned at the time by flagship conglomerate Dubai World DBWLD.UL helped trigger the emirate's 2009 debt crisis. A last-minute bailout by Abu Dhabi helped Dubai avert a bond default on a Nakheel bond in December 2009. "We are talking to financial institutions to restructure our loan, which is a normal part of business because the original tenure is very short," Lootah said. "We have time but we are talking to them from now and engaging them from now to get a longer term. We are not worried about the sukuk. Our strategy first will be deal with the lenders. The sukuk is a secondary issue to that." The bank loans under consideration are thought to be debt restructured under the 2011 agreement. This includes 6.76 billion dirhams in secured facilities provided by, among others, Dubai's biggest bank Emirates NBD ENBD.DU as well as 470 million dirhams in unsecured facilities, all due in 2016, according to Nakheel's sukuk prospectus and estimates by Exotix Limited. "This is all previously restructured bank debt. They (Nakheel) are trying to refinance all of this debt before the majority falls due in 2016," said Gus Chehayeb, director, Middle East and Africa Corporate Research at Exotix, in Dubai. Nakheel reported a 57-percent rise in annual profit in January. It also made interest and profit payments of around 800 million dirhams to lenders last year and has paid around 10 billion dirhams to various trade creditors and contractors since the start of its debt restructuring. "We have sorted all the old issues, most of the old issues," Lootah told the newspaper. But he ruled out re-starting work on Palm Jebel Ali, one of three man-made islands in the shape of palm fronds that Nakheel planned to build off the Dubai coast. Of these, only one - Palm Jumeirah - has been completed. "Nakheel will grow and grow and grow in a more careful manner and with a more well-studied strategy and plan," Lootah said. "Tourism is booming in Dubai so people are looking for more options, so we are looking at that." Last week, Dubai gave the go-ahead for a $1.6 billion artificial island, not connected to Nakheel, as it resumes extravagant developments, despite several stalled or abandoned projects commissioned during the previous decade's boom. Mon, 17 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32926 ABU DHABI,(Reuters) - Kingdom Holding Co, the international investment firm of Saudi billionaire Prince Alwaleed bin Talal, and a consortium of investors have bought a 1.5 billion rial ($400 mln) stake in Chinese online retail firm 360buy Jingdong, the company said. Kingdom Holding's investment in the deal came to 470 million rials, the firm said in a statement on Saturday. It said Qatari bank QInvest had advised on the deal. "Our deal solidifies the strategic relationship between Saudi Arabia and China," Prince AlWaleed was quoted as saying in the statement, which did not mention the identities of the other investors in the consortium. According to its website, 360buy Jingdong is China's leading online retailer of consumer electronics. Kingdom Holding already has investments in China's entertainment and hotel sectors. Sun, 16 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32900 DUBAI/SANAA, (Reuters) - When political turmoil drove Yemen to the brink of economic collapse in 2011, Jumaan Trading & Investment Co saw its sales plunge by more than 60 percent, prompting the company to shift part of its operations to neighbouring Saudi Arabia. But the ouster of strongman president Ali Abdullah Saleh a year ago, and a partial improvement of security in the poverty- and militancy-stricken country, are now helping to revive the economy, boosting JTI's sales. "There is definitely an improvement in the situation, especially compared to 2011," said Ahmed Jumaan, general manager of JTI, which focuses on agriculture, power generation and construction. Sales at JTI, founded in 1958, jumped 55 percent to about $24 million in 2012, although that is still 5-10 percent below levels seen before the political crisis began, he told Reuters. Yemen's fledgling economic recovery is good news for efforts to restore political stability in the country, which is important for the entire region because it lies near major oil shipment routes. The recovery is also a positive omen for other Arab Spring states which are struggling to rebuild their economies after political turmoil in the past two years. The economy of Yemen, the second poorest Arab state after Mauritania, shrank 10.5 percent in 2011, the International Monetary Fund estimates, as the unrest caused fuel and power shortages and oil pipelines were attacked. The IMF says the economy stabilised in 2012, and after a business revival toward the latter half of the year, it predicts growth of around 4 percent in 2013. Other key indicators have drawn back from crisis levels. Inflation eased from a peak of 25 percent in October 2011 to 5.5 percent last November, the latest available official data shows. The Yemeni rial has stabilised around 215 to the U.S. dollar after sinking to about 243 in 2011. This has allowed the central bank to cut its key interest rate twice in four months to aid the economy, by a total of 5 percentage points to a still-high 15 percent. SUBSISTENCE Much of Yemen's economy is operating close to subsistence, so it would not take much to stifle the recovery. The country faces dwindling oil and water reserves, and per capita income was $2,232 in 2012, just 8 percent of the level in neighbouring Oman, according to the IMF. A third of the 25 million people live under a poverty line of $2 a day and unemployment is estimated at around 35 percent - with youth unemployment at 60 percent. Watheq al-Hamadi, manager of a large grocery store in Sanaa's upscale neighbourhood of Hidda, said that despite the economy's improvement, few Yemenis could afford to buy any form of luxury item. "The only thing that has come back is power supplies and petrol. The purchasing power is still weak," Hamadi said as he warned his staff to look out for shoplifters. Since the tourism and construction industries remain paralysed - Jumaan said his company's construction equipment sales were still only about 30 percent of normal - economic growth will not necessarily create many jobs. "I've been living off my friends since the revolution started," said Ali Abdul Rahman, who used to work as a translator, teacher and assistant to foreign aid agencies, but now spends most of his time reading at Sanaa cafes. "I was hoping that electing a new president and forming a new government would improve the situation, but nothing has changed so far," he said. Finding jobs outside Yemen, which could be a safety valve to limit unemployment, is difficult since countries in the region restrict the entry of Yemeni workers. Yemen's labour market "can absorb barely 20,000-30,000 from this huge number of unemployed", said economist Mohamed al-Maytami, chairman of the Khobara Centre for Development and Consulting Services, which provides services to foreign aid donors, the government and the business sector. AID JTI and tens of other Yemeni firms moved their construction businesses to Saudi Arabia and other Gulf states during the 2011 turmoil. If Yemen's construction sector starts to recover, many of these companies will return and the sector could absorb 150,000-200,000 local workers, Jumaan said. A construction recovery will require the cash-strapped Yemeni government to issue a large number of infrastructure tenders, however. And for that to happen, at least two conditions will have to be met. One is further improvement in security. Yemen depends on crude oil exports for about 60-70 percent of its state budget income, and its finances are still being sapped by bombings of oil and gas pipelines by insurgents or disgruntled tribesmen. "You are talking about a $400-500 million loss every month because of the sabotage, which is big money for Yemen," Maytami estimated. In the latest incident, attackers last week blew up the country's main oil export pipeline, which carries 110,000 barrels per day. The government is mounting a two-pronged campaign to secure the oil infrastructure, at times attacking tribesmen with tanks and rockets and at other times negotiating with them, but a solution lasting more than a few weeks has not yet been found. The second condition for a construction recovery is larger inflows of foreign aid. Last autumn wealthy Gulf Arab countries, Western governments and other donors pledged $7.9 billion over several years to Yemen, but only a small fraction of that money has so far arrived; Maytami estimated under $750 million. The Yemeni government is seeking $12 billion. Other countries hit by Arab Spring uprisings have found that pledged aid can be slow to arrive. Donors are due to meet in London next month to assess the situation in Yemen. The IMF estimates Yemen posted a state budget deficit of about 5.5 percent of economic output last year, and that the deficit will widen slightly this year. "I do not think the budget itself is enough to confront challenges facing the country. That's why in the short term, there is concern about the financial commitment from donors," Maytami said. Thu, 13 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32884 KUWAIT, (Reuters) - Islamic financial institutions in Kuwait should hire enough personnel to ensure they comply with sharia standards, and work with the personnel in a transparent way, the country's market watchdog said on Tuesday. The statement by the Capital Market Authority (CMA) appeared to be in response to concern about uneven self-regulation by the institutions. The number of Islamic financial firms, which obey religious principles such as a ban on the payment of interest, has increased substantially in Kuwait and elsewhere in the Gulf over the past decade. The companies have in-house sharia boards of scholars who rule on whether their products and actitivies are sharia-compliant, and sharia compliance officers who check whether guidelines are being followed on a day-to-day basis. But around the Gulf, the industry has been hampered by shortages of experienced scholars and qualified staff, and by rulings by sharia boards at different companies that sometimes conflict with each other, confusing investors. The CMA's statement on Tuesday called for "the appointment of a sufficient number of legal observers in accordance with the size of the institution". It urged institutions to provide "full transparency" in their communications with compliance officers. The watchdog also urged companies' sharia boards to take more care to issue rulings that were in line with each other. The CMA's statement was a recommendation, not a new set of regulations. CMA officials could not be reached for comment. There are five Islamic banks and around 30 mostly Islamic investment companies listed on Kuwait's stock market, as well as 15 "takaful" Islamic insurance companies. Wed, 12 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32872 DUBAI, (Reuters) - About 30 billion dirhams ($8.2 billion) of funds have flowed into the United Arab Emirates over the past two years from countries hit by the Arab Spring uprisings, the UAE's prime minister said on Monday. "We received 30 billion dirhams from the Arab Spring...plus/minus," Sheikh Mohammed bin Rashid al-Maktoum, who is also Dubai's ruler, said in answer to a question by a member of the public at an open forum of government officials. Large amounts of capital fled Egypt, Tunisia, Syria, Yemen and other Arab countries in search of safe havens after political and economic turmoil erupted in those countries in early 2011. Because of its political stability and Dubai's status as an international business centre, the UAE attracted a large share of the capital. Sheikh Mohammed's figure was believed to be the first public estimate of the amount by a top official. He insisted, however, that it would be wrong to think the UAE was benefitting from the Arab Spring, as stability in countries hit by the unrest would benefit the whole region including the UAE. "If we had peace and stability, we would have more than 30 billion coming from those countries," Sheikh Mohammed said. He did not specify in what forms the money had entered the UAE; part is believed to have come in the form of short-term bank deposits, and part as direct investment in businesses and real estate. Dubai's real estate market began to recover last year from a crash in the previous few years, partly because foreign investors saw the emirate as a safe haven, property analysts said. The UAE attracted $7.68 billion of foreign direct investment from all countries in 2011, up from $5.50 billion in 2010, according to the United Nations Conference on Trade and Development. Sheikh Mohammed also said the UAE had invested much more than 30 billion dirhams in countries hit by the Arab Spring. The oil-rich UAE has pledged billions of dollars in aid to help stabilise cash-strapped Arab states since the uprisings began, and UAE companies have shown interest in investing in North Africa. Tue, 11 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32855 Riyadh, Asharq Al-Awsat—Prince Turki bin Salman has been named chairman of the Saudi Research and Marketing Group (SRMG), succeeding Prince Faisal bin Salman who was recently appointed governor of Medina province. SRMG's Board of Directors yesterday announced that the changes were approved in a board meeting last Thursday in Riyadh. At the meeting, the board members acknowledged Prince Faisal's efforts in leading SRMG to achieve numerous important accomplishments during his 10 year tenure. SRMG is the parent company of Asharq Al-Awsat. Prince Turki's tenure as chairman for the current session extends to April 30, 2015, the board said. The appointment will be put up for approval at the next regular General Assembly meeting. Prince Turki was born in Riyadh in 1987. He holds a bachelor degree in marketing from King Saud University and he is currently the chairman of Tharawat Holding Company. Dr. Abdul Rahman Al-Shubaily has been appointed SRPC board of trustees' member and secretary-general. Established in 2008, SRPC board of trustees is first of its kind in the Arab media in terms of its structure, mission and powers. The board supports professional independence of the group's publications in line with its policy of separating management from the editorial section. It plays an effective role in the selection of editors in chief of the company's publications and their deputies. Mon, 10 Feb 2013 13:43:12 GMT http://www.asharq-e.com/news.asp?section=6&id=32846 Riyadh, Asharq Al-Awsat—The gold market in Saudi Arabia continues to realize modest results in 2013, a time in which gold investors had expected the individual rate of sales to rise. This comes following a period of reluctance which lasted more than three years due to the high price of gold per gram. Traders in the market have said that the rate of decline since the New Year has reached 5 percent. This dilemma has forced factories to change the moulds of their gold products in order to attract customers, having largely adopted styles which seem dense and heavy but are in actuality hollow. However this tactic does not seem to have succeeded in generating significant purchases. Traders in the gold market explain that the current prices impede consumer demand and raise buyer reluctance, indicating that these prices have reached unreasonable levels and have become largely unpredictable. Said Backerman, a gold market trader, stressed that he is depending on 2013 to rectify the crisis in sales. He said, "What is surprising is that there has been a further decrease in demand by about 5 percent over the first months of 2013. This coincides with a surge in prices which is making customers think twice before deciding to buy gold. The fluctuations in gold prices have a negative impact on final sales. Gold is also considered the safest investment in global markets, and in these uneasy economic times, the demand for gold in global markets is strong and compounds the already high prices.” Last year traders wagered that the gold market would experience a corrective decline in 2013 based on 2012’s unusually high prices and data on supply and demand. However key indicators have shown that prices are remaining high and are going to hover at current levels or even increase. Gold trader Fayez Al-Saqaf said, “Gold traders are not experiencing losses, but there is a decrease in profits, and if weak sales continue there will be negative long-term impacts.” He pointed out that gold prices are determined by global markets, which makes the issue more complicated for Saudi traders. As for the current price of gold, Mr. Saqaf said that a 10-karat ounce of gold currently fetches $2,263 dollars, 14-karat of the same weight costs $3,161, 18-karat $4,006, 21-karat $4,733, 22-karat $4,958, and 24-karat $5,407. These figures indicate that prices continue to rise, contrary to some global markets. In most markets gold is considered a safe investment option because it is traded globally and functions as a sort of global economic short-hand. The price of gold has fluctuated over the past two years, but its overall value has increased due to the recent crises and recessions in the global economy. This pattern is similar to that of the price of oil, which is projected to continue to increase during the coming year. Moreover uncertainty in the Eurozone has added to the demand for gold, with many investors considering it a safe option to weather the economic storms which are battering some of the world's economies at the moment. Rashid Al Dosari, who owns of a number of gold shops, says that the way Saudis purchase gold has changed, saying, “Conspicuously heavy gold jewelry was in high demand, but this style has been replaced by orders for smaller pieces of jewelry that seem heavy but are actually hollow, or that contain small apertures which decrease overall weight.” He pointed out that factories responded quickly to this shift in demand and have been producing styles to match the new trend. Mr. Dosari went on to say, “Most purchases are gifts for women, such as wedding bands. But these have decreased as of late because of the increase in price.” It is noteworthy that Saudi Arabia is fourth in the world in gold purchases, and first in the Arab world, accounting for approximately a third of total demand for gold in the Middle East. The country’s economic and political stability have been instrumental in allowing it to become a global leader in the gold industry. Sun, 09 Feb 2013 13:43:12 GMT