Trade between Kuwait and Germany surges 76% in 2010

Trade between Kuwait and Germany surges 76% in 2010
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Trade between Kuwait and Germany surged 76 percent in the last year, according to new figures from the German Ministry of Economics and Technology.
The volume of trade between the Gulf state and Germany, which is the second biggest exporter in the world after China, rose to just over $1bn, Alexander Tettenborn, head of division for North Africa and Middle East at the German Ministry of Economics and Technology, told the Kuwait News Agency.
The announcement came as Tettenborn was in Kuwait to sign a new trade cooperation with the Kuwait Chamber of Commerce and Industry (KCCI).
He added that the bulk of the trade came from the technology sector, particularly petrochemicals, and was the result of six trade delegations made by German companies to Kuwait during the past year.

Chevron says Saudi-Kuwait oil field steam trials ‘promising’
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Chevron Corp, the second largest US energy company, said a pilot project to boost production by injecting steam into an oil field shared between Saudi Arabia and Kuwait showed “very promising” results.
Chevron is trying to boost production from the Wafra field in the so-called Neutral Zone shared between the two countries by as much as 600,000 barrels a day once a new method for injecting steam is applied on a large scale.
“We have 16 steam-injection wells in the field and I can tell you that the results that came out were very promising,” Ganesh Thakur, Chevron’s vice president and global adviser for reservoir management, told an industry conference on Saturday in Dharan, Saudi Arabia.
The Wafra field will become the world’s largest project for oil recovery with steam injection, once the company applies it to the entire field, Thakur said.
Chevron began injecting steam at the site in June 2009 to extract more crude. The San Ramon, California based company is still testing the steam-flooding technology on a small part of the Wafra field.
The cost of the pilot project is $340m and to apply the technology to the entire field would cost several billion dollars, Gary Greaser, an assistant to the Chevron president, told Bloomberg on October 19.
The decision to apply the technology to the entire field will be made in 2013, Greaser said.

he biggest opportunity on Earth?
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Remy Rowhani is ecstatic. “Qatar is currently the land for opportunities,” he says excitedly.
Admittedly, as CEO of the Qatar National Committee of the International Chamber of Commerce and the CEO of Qatar’s bid to host the Eighth World Chamber Federation in 2013, he has every reason to celebrate.
Just days after he was told his team was successful in its bid to bring the 2013 event to Qatar, the country is celebrating becoming the first Arab country to be awarded hosting duties for a World Cup.
“Qatar has gone through a very difficult process for the 2013 and the 2022 events, but against all odds it has won the bids and we are extremely proud of it,” he adds.
Through his work with the International Chamber and the Qatar Chamber of Commerce and Industry, Rowhani is one of the people tasked with making sure local Qatari businesses fully benefit from both events.
“Every sector, without exception, will have an excellent opportunity to make business. Believe me, opportunities are many and varied. Networking is our job. We will arrange the necessary networking with any of those that are interested and we will guide them and lead them,” he says, still in exuberant mood.
However, it is not all simply catchphrases and soundbites and Rowhani says the wheels are already in motion to start exploiting the commercial avenues. The 2013 bid committee has put in place a special organising body to analyse and brainstorm the potential business opportunities from the event and this will also be put in place for the 2022 World Cup.
He adds that a special body has also been set up to help with the legal and administrative aspects of setting up any business venture in Qatar that wishes to benefit from the events.
“We are looking for new ideas. Anyone who has opportunities, we are very open and willing to look into it,” he adds.
So where will the benefits for businesses come from? A report commissioned by the Qatar 2022 bid team, and carried out by consultants Grant Thornton, estimates that hosting the World Cup in Qatar will increase football related revenues across the Gulf by around $14bn, a rise of 52 percent over the next twelve years.
One of the most lucrative opportunities will be in pay TV broadcasting rights and the study says that “given the central location of Qatar, 82 percent of the world’s time zones would receive Qatar 2022 games live in prime time, with a potential match day peak audience of 3.2 billion viewers.”
One of the benefactors of these viewing figures is likely to be the Doha-based Al Jazeera television station, which already runs fourteen sports stations. As it stands, football is currently the most watched TV programme in Qatar, watched by 77 percent of men and 64 percent of women.
However, while the study estimates that direct TV revenue rights are expected to rise by 30 percent to $550m by 2022, Seth Holmes, director of consulting at IMG Middle East, a sports marketing and consulting firm, points out that “the vast majority of that will go back to FIFA.”
In fact, as much as 90 percent of this lucrative revenue stream will not go to Qatar, but will go into FIFA coffers.
“FIFA do take a huge slice of the TV money, which is why a lot of surprise has been leveled at the fact that they went with Russia and Qatar, especially Qatar, as, from a commercial perspective, it is pretty far from a safe bet… but if you go for England you are guaranteed to do good business with broadcasters,” says Holmes.
As an unproven market, sponsorship and marketing opportunities could indeed be an issue. FIFA’s official evaluation of Qatar says that while Qatar highlights 30 local corporations that sponsor sporting events in the country, its verdict was that “given the limited size of the population and the economy, Qatar is not considered to be an important market for most of FIFA’s commercial affiliates.”
Holmes says: “Compared to a US or UK bid, yeah it will have challenges raising domestic sponsorship I think, but I don’t think that is a problem for Qatar. Their financial status is so strong that the World Cup is not going to rise and fall on the number of national partners they get.”
The Grant Thornton report forecasts that football match attendances in the Middle East will increase by 13.4 percent over the next twelve years, adding an additional 4.2 million fans. Holmes believes that international sponsors will view participation in the tournament as a chance to access the emerging Middle East market.
“I believe international businesses will see it as a Middle Eastern sponsorship opportunity. We believe it will be well promoted to and followed by the Middle East region and companies will see it as being a fantastic marketing platform if they have a Pan-Middle East footprint,” adds Holmes.
While he admits that some hospitality and marketing considerations are likely to be restricted, such as alcohol branding, he reports that some of the large international brands his firm works with are already looking favorably on both the opportunities of accessing the Middle East consumer market as well as the business to business opportunities.
At a local level, the win has already had an impact. The official FIFA announcement in Zurich sent shares on the Qatar Exchange rocketing to their highest level for more than two years, with Qatar National Bank, the emirate’s biggest lender by assets, and Barwa Real Estate Company, Qatar’s largest publicly traded property developer by assets, benefiting the most.
However, Dr John Sfakianakis, group general manager and chief economist of Banque Saudi Fransi, believes it is too soon to say what the benefits will be for Qatar and the surge in shares is simply a result of early good sentiment.
“It’s premature to talk about its impact especially in the stock market. For sure, the state will underwrite the projects and private participants will benefit but for corporate governance to change and stock markets to flourish just because of the World Cup could be an overstatement at this point,” he believes.
With the World Cup forecast to lead to around $57bn in government spending, one sector that is likely to benefit in the long-term is the banking sector, which will fund the rise in commercial activity, according to the Moody’s ratings agency.
“As the country prepares for the World Cup, we expect all Qatari banks to benefit from stronger economic activity and higher credit demand in the next twelve years. We estimate that accelerated government spending of $57bn over the next decade for infrastructure development projects relating to stadium construction, accommodation, and upgrading of existing transportation systems will create new lending activity for all banks in the system,” Moody’s forecasts.
Last year, Qatar’s total banking assets amounted to $129.4bn, which represents around 130 percent of the country’s gross domestic product (GDP), which Moody’s says is low for a developed market. Clearly, there are growth opportunities for Qatar’s main banks, such as Qatar National Bank, the Commercial Bank of Qatar and Doha Bank.
On the back of this rise in liquidity and business opportunities, sources at the Qatar Exchange believe that, over the next twelve years, there is likely to be a rise in the number of family and privately owned companies looking to go public to raise capital.
This has already been actively encouraged by the Qatar Chamber of Commerce and Industry and Rowhani says, “there is no question” that this will happen. “2022 is going to bring in a lot of liquidity into this country. The major multinationals are coming and the population is growing,” he adds.
While it is obvious what the benefits will be for the banking and capital markets, the hospitality sector is a much harder market to decipher. According to FIFA’s official report on the evaluation of the Qatari bid, Qatar is planning to double its hotel inventory to nearly 90,000 rooms over the next twelve years, which will result in an investment of around $17bn over the next five years.
Qatar plans to have 240 properties in place to cater to accommodation needs during the tournament. The report says that Qatar currently has 100 existing hotels, villages and compounds spread across the seven host cities. An additional 140 properties will be sourced or constructed to meet accommodation needs, “including a cruise ship project in Al Wakrah with 6,000 rooms.”
Two thirds of the new supply of inventory, which will amount to around an extra 55,000 rooms, will be covered by seventeen construction projects, thirteen of which will be completed by 2016.
While the official FIFA report said Qatar currently attracts around one million visitors a year and is aiming to grow visitor numbers by 20 percent over the next five years, the country is already suffering from an oversupply problem.
“The World Cup announcement has come at a crucial time in the growth of the hotel sector in Doha, which many privately feared was heading for oversupply and a rate war, as is being experienced now in Dubai’s Al Barsha district, for example,” says Guy Wilkinson, general manager at Viability, a Dubai-based hospitality consultancy company.
But building ahead of the tournament is not the only problem.
“Solutions like cruise ships are good solutions, it makes sense… But Qatar will face similar issues as other countries have been facing, in terms of what do you do with all the inventory once the event is over,” says Jalil Mekouar, regional director and head of real estate advisory at Jones Lang LaSalle Hotels.
“This challenge will be amplified for Qatar as we are talking about a city state, pretty much, and we are talking about a small place physically, which is not as large as South Africa… Talk to double [the inventory] is just going to emphasise the problem rather than solve it,” he adds.
However, Wilkinson is confident that growth in the tourism sector in Qatar could sustain the growth in supply.
“Qatar has already witnessed the importance of a major global sporting event to its hotel sector, when it hosted the 15th Asian Games in 2006. Not only were the hotels booked out during the two weeks of the games themselves, but they received significant and increasing demand for at least two or three years before that,” he says.
The Qatar government has vowed to use its energy-fueled riches to plug any hole in the tournament’s budget and has guaranteed construction of the infrastructure. So what will be the ultimate reward for Qatar?
“The biggest impact for Qatar is global recognition for a country which is little known. The World Cup will provide Qatar with the global recognition they seek,” says Sfakianakis. What recognition that will result in will be decided in 2022.