Kuwaiti-Iraqi economic ties need further development: experts HSBC Mideast taps Eldon A host of economists stressed in opened between the two neighbor- the private sector’s role, and the and long range, due to Iraq being HSBC has appointed David Eldon, He retired from HSBC Group in Kuwait on Wednesday the necessi- ing countries, especially in the prospects for logistics, cultural and second in the world in terms of oil a former chief executive of the May 2005, but serves as a non- ty to develop economic ties domains of energy and tourism, social relations between both reserve, in addition to its water bank, as chairman and non-execu- executive chairman of the Dubai between Iraq and Kuwait and through the “smooth” transition of countries, Kuwait Energy resources.” He added that Kuwait tive director of its Middle East oper- International Financial Centre search for investment ventures that capital and expertise. Chairman Mansour Bu-Khamsin would be of the top beneficiaries of ations, it said on Thursday. Authority (DIFC), which incorpo- are of mutual benefit. The seminar was organized by said Kuwait and Iraq have always Iraq’s gas-production plan, due to Eldon, who started his career rates the emirate’s financial free In a seminar sponsored by the Gulf Studies Center of the had historic commercial and eco- the country’s need of such power with the bank in 1968, has held zone, as well as a senior advisor Kuwait Energy Company earlier American University of Kuwait nomic relations, even before the resource, voicing trust of Kuwaiti prominent positions within the at PricewaterhouseCoopers. today and titled “Kuwait and Iraq (AUK). discovery of oil. businessmen to take advantage of lender, including as managing Earlier this week, HSBC said it together towards a bright future”, Discussing the role and benefits “In light of political stability return- Kuwait’s strategic geographical director of its Saudi affiliate SABB, will shed up to 3 percent of its the experts also stressed the need of growing economic relations ing to Iraq, a promising economic location to be “logistically” utilized in chairman of Hang Seng Bank, Middle East workforce to improve for investment windows to be between Kuwait and Iraq, namely future will follow suit in the medium this regard. (KUNA) and director of HSBC Holdings. efficiency. (RTRS) Market Movements 28-04-2011 Business Points Closing pts Points Closing pts JAPAN - Nikkei 225 +157.90 9,849.74 AUSTRALIA - All Ordinaries -1.70 4,952.30 GERMANY - DAX +70.27 7,475.22 HONG KONG - Hang Seng -87.21 23,805.63 FRANCE - CAC 40 +37.18 4,104.90 PHILIPPINES - All Shares -31.69 3,096.73 EUROPE - Euro Stoxx 50 +27.74 3,005.33 INDIA - Sensex -156.67 19,292.02 SOUTH KOREA - KRX 100 +4.030 4,722.34 tracking global trends Ernst & Young Cleantech transformation becomes a competitive advantage By Nadeem Shafi cleantech into their growth strategies. Many are also “greening” their existing KAMCO reports KD 1.8 mln net Partner, Ernst & Young Training products in response to increasing con- W e have been discussing that six key developments are shaping the business world in which the sumer demand. Others are moving into growth areas that fall outside their tradi- tional lines of business, hoping to Governments and organizations are now achieve first-mover advantage as the announcing plans to shrink their carbon landscape evolves. For example, footprints. The move to cleantech may represent a second industrial revolution that will have effects as great as the first. The cleantech-enabled transformation to a low-carbon, resource efficient econ- omy may be the next industrial revolu- Google and Cisco have both entered the home energy management space. In the past year, corporate activity in the clean- tech marketplace has significantly increased through direct investments, partnerships and acquisitions of newly profit in ’10; EPS clocks 7.6 fils tion. As this transformation accelerates, formed cleantech companies. This global corporations are increasingly search for cleaner products will break Asset Under Management up 7.8 pct at KD 2.36 billion realizing that they must understand the apart many traditional industries. For impact of cleantech on their industries example, the way that low-carbon and and develop strategic plans to adapt to electric vehicles (EVs) are bought, sold, By Iddris Seidu this change. distributed and maintained could trans- Arab Times Staff and Agencies Governments also view cleantech as a form the utilities and automotive sec- KUWAIT CITY, April 28: A net national strategic platform for creating tors. The global EV market is gearing up jobs, fostering innovation and establish- for large-scale EV manufacturing, and profit of 1.8 million Kuwaiti ing local industries. According to governments are setting needed EV dinars and 7.6 fils earning per Bloomberg New Energy Finance, invest- standards. But questions remain as to share was announced as ment in cleantech surged 30% in 2010 who will “own” the customer - KIPCO Asset Management over the previous year to US$243 billion, automakers, utilities or emerging inte- Company (KAMCO) convened double the amount recorded in 2006 and grators - and who will manage the data nearly five times that of 2004. But this is flows across the various entities. their Annual General Meeting not enough. There is still a large gap Governments and companies move to (AGM) and shareholder forum between the capital required and the cap- secure valuable raw materials and to (Shafafiyah) Thursday to ital available to fuel the transition to a ensure energy security declare its financial results for low-carbon economy. Primary energy the year ending December 2010 demand is expected to grow by 36% Raw materials are strategic assets, especially in a time of scarcity. To at their head office building in worldwide between 2019 and 2035, with the bulk of that new energy use (93%) secure them, some governments have Sharq. coming from emerging markets. By turned outward. China, for example, is It was an event that saw heavy 2035, China alone will see its energy now deeply invested in Africa. One shareholder and representatives of needs rise by 75%, according to the recent, typical deal: two state-owned companies under KAMCO manage- International Energy Agency (IEA) Chinese companies received cobalt and ment attendance. KAMCO execu- report, World Energy Outlook 2010. copper concessions in the Democratic tives led by Sadoun Ali the Chief In the coming years, surging demand, Republic of Congo in exchange for Executive Office (CEO), and Entisar energy prices, energy security concerns upgrading that country’s infrastructure. Al-Suwaidi, Vice-Chairman were as and scarcity of natural resources will In 2009, the value of Chinese invest- well present to steer the event. encourage governments and companies ment reached US$17 billion, or 22% of In her address to shareholders, Al- to work harder to diversify their energy all global mining M&A activity and Suwaidi stated, “On behalf of KAMCO’s portfolio mix and to continue invest- 30% of the top 10 deals. At the same Board of Directors, I am pleased to ments in clean energy innovation, time, countries are becoming more pro- announce that in 2010 we continued to deployment and adoption. This tective of their natural resource sup- deliver success for our client community inevitable move to a low-carbon, plies. Companies, meanwhile, are despite the economic difficulties and resource-efficient economy presents an reconfiguring supply chains, seeking ongoing challenges in local, regional and opportunity to stake out and capture a greater flexibility in an effort to mitigate world capital markets. During the year strategic competitive position - not just the impact of raw materials shortages, KAMCO recorded a net profit of KD 1.8 Photo by Anwar Daifallah for governments, but also for innova- higher commodity costs and price million, with earnings per share of 7.6 From right: Sadoun Ali (CEO), Entisar Al-Suwaidi (vice-chairman) and other KAMCO officials at the KAMCO AGM. tors, investors and corporations, too. volatility. Some businesses are protect- fils. Total revenues reached KD 10.4 mil- Looking ahead, we see a number of ing their supply chains by acquiring lion in 2010, and Assets Under lion) bond deal for the United Real Estate The Investment Research Department forum featured a review of KAMCO’s important changes: their raw material suppliers. Management (AUM) increased by 7.8% Company- the first debt issue in Kuwait at KAMCO signed an exclusive capital performance during 2010, and the oppor- Steelmakers, for example, have recently to KD 2.36 billion reflecting growing since 2008 - and the successful raising of markets partnership with Oxford tunities and forecasts for 2011. The energy mix evolves bought several iron ore and coal mines client confidence. USD 400 million through the international Business Group’s (OBG) for the sixth Reviewing KAMCO’s performance for Renewable energy is still expensive in different countries to guard against KAMCO’s informed and responsible market for our client Burgan Bank as joint edition of ‘Kuwait 2011’ where they have 2010, the Company’s Managing Director in most places, which will limit its use supply chain disruptions. The anticipat- approach to doing business in a tough cli- lead managers with JP Morgan, Morgan provided OBG with economic outlook as and Chief Executive Officer, Sadoun Ali, in the short run. But as wind, solar and ed growth in energy demand, mainly in mate was proven to be a success in a year Stanley and Standard Chartered. Strategic well as financial analysis reports for sec- said: other renewable projects scale up, their emerging markets, has forced govern- that saw a major shuffle within Kuwait’s successes included the profitable exit from tors such as real estate and construction, “The net profit of KD 1.8 million for prices will continue to fall. The IEA pre- ments to focus on long-term energy investment management arena. We have non-core investments such as the sale of telecoms and IT, insurance, Islamic 2010 has been achieved after setting dicts that power generation using security and take actions such as diver- fully consolidated our position as a trust- 60% controlling stake in Advantage financial services, industry and retail. aside investment provisions of KD 0.1 renewable will triple between 2010 and sification of the energy generation mix, ed partner that plays a vital role in serv- Consulting, and a shift away from health- The Department also extended its reach million, compared to KD 1.6 million for 2035. Fossil fuels such as oil and coal investments in cleantech, encourage- ing all the communities in which we care sector exposure to further align as a key financial intelligence provider to 2009. This lower level of provisions will lose market share over time, as nat- ment of energy efficiency and acquisi- work. This comes at a time when trust has KAMCO’s strategic focus. In addition, influential financial networks including reflects better management of possible ural gas and nuclear power contribute to tions of energy sources overseas. never been more important for mutually KAMCO leverage stands at 0.73x well Thomsonreuters, Bloomberg, Zawya, impaired investments under conservative the diversified energy mix. There has successful business relationships at all below the market levels, and the current accounting principles. Investment rev- Organizations become more transpar- level.” Menafn and Capital IQ, as well as in been a surge in construction of nuclear ent about their sustainability cash balance is healthy at KD 11 million. Kuwait’s daily and weekly press through enue of KD 2.3 million has been posted power reactors worldwide. Natural gas, Ethical Key achievements by the Division’s stock market reports and analyses. for 2010 despite volatile markets, com- practices Private Equity Department focused on the pared to KD 0.6 million for 2009.” a cleaner-burning fossil fuel, is expected She also added, “Our focus on best eth- Prioritize to grow more important, serving as a As concerns about resource scarcity, ical practice and compliance in 2010 con- Kuwait Education Fund (KEF), which “KAMCO’s strong performance dur- bridge to a renewable-based economy. including energy and water, become tinued to drive all aspects of KAMCO invests in programs and projects that aim to During the year KAMCO continued to ing 2010 is attributed to a mix of favor- Historically, corporations got their ener- more pressing, companies will face and its products and services, under- improve and promote learning and educa- prioritize the professional development able factors, including the 19% cut-down gy from a few select traditional sources, increasing pressure from their stakehold- pinned by our Code of Ethics and tion in the State of Kuwait, and KAMCO’s of its talented staff, also benefiting from in administrative expenses and the 7% but today the energy supply options ers to demonstrate that their businesses Standards of Professional Conduct that Shariky Fund Portfolio. The latter aims to the recently re-launched website for all reduction in finance costs. Other major vary. For example, companies can have are sustainable. Companies will also we further strengthened during the year. achieve the goals of the Kuwait Investment external recruitment. Training was factors comprised better risk manage- a renewable energy project onsite or off- have to disclose the social and environ- A number of strong strategic themes Authority that include developing the extended at all job levels and will contin- ment practices throughout the Company, site or procure it from a third party, and mental impact of their business activi- emerge from a review of the 2010 busi- national economy and participating in ue to evolve as more is learned about with an active risk management and com- their corporate fleet can run on fuel, gas, ties. Although most sustainability report- ness environment including an opportuni- building a human capital base in Kuwait by individual development needs through pliance function, improved corporate electricity and (or) biofuels. Companies ing is currently voluntary, the broad ty for both KAMCO and our clients to attracting talented young Kuwaitis to small the newly introduced Employee governance practices, revamping of poli- can also deploy sophisticated energy trend is toward greater disclosure. More play an increasingly important role in our to medium enterprises. Some of the busi- Engagement Survey at KAMCO. cies and procedures, prudent asset/ liabil- efficiency options, measure consump- than 3,000 companies worldwide issue own country’s future development.” nesses that joined the Shariky plan fall Upon adjourning the shareholders’ ity management reflected in reduced tion in better ways, sell energy back to such reports, following such voluntary A series of Corporate Finance achieve- within the sectors of industry, logistics, General Assembly meeting, KAMCO’s leverage and extension of debt maturities, the local utility and use their waste to guidelines as the AA1000 ments in 2010 typify KAMCO’s energy services and IT. The KEF enjoyed a unique Management held the Company’s Annual and running the Company’s business with produce energy, as well as measure their AccountAbility Principles Standard and and the faith the business community year in 2010, attracting new subscriptions, Shafafiyah Investor’s Forum, which has the existing human resources,” he added. the Global Reporting Initiative places in our ability to deliver success, increasing its Net Asset Value by 132%. Its become a tradition organized on the side- Concluding the presentation, Ali carbon footprint and report it. lines of the shareholders’ General Reporting Framework. These voluntary despite market conditions. These include (unaudited) YTD return for 2010 was addressed the opportunities available in Clean energy is a national guidelines may soon become mandatory. oversubscribed debt market transactions 11.3%. Shariky investments increased by Assembly meeting. The agenda of the 2011 and the Company’s forecasts for the competitive advantage Key questions for global companies such as the KD 40 million (USD 140 mil- 111% during the year. investor presentation delivered at the year, as follows: Many governments are aggressively 1. The global transformation to a implementing clean energy policies, set- ting emissions targets and providing more resource-efficient and low carbon economy brings opportunities and risks Al Safat Investment Co incurs loss in 2010 incentives for cleantech investing. for almost all industries. Is your busi- China, Germany, India and Brazil are ness aware of - and actively monitoring gaining leadership positions in solar, wind and biofuels. The US remains a cleantech leader because of its entrepre- neurial culture and vibrant venture cap- - the far-reaching effects this transfor- mation is likely to have? 2. Do you understand your competi- Al Rai Media posts KD 627,863 profit in Q1 tors’ cleantech-related strategies and are KUWAIT CITY, April 28: Al- Rai related parties amounts KD 49,914. Total income from transactions is abide by the provisions of the ital environment. Policy-makers are bet- you equipped to compete with them? ting that cleantech investments will Media Group Company (Al-Rai) ❑ ❑ ❑ worth KD 229,102 and total expenses Ministerial Decree No. 10/1987 and its 3. Is your cleantech-related strategy reported that the board of directors from transactions amounts to KD amendments, by virtue of the two yield other benefits such as job creation optimized for both operational efficien- Central Bank of Kuwait has approved approved the financial statements for the 322,716. Ministerial Decrees No. 11/1988 and and innovation-led economic growth. cy and revenue growth, and does it max- Al Safat Investment Company’s (Al- Notably, private investment is flowing Q1 period ending March 31, 2010, dated ❑ ❑ ❑ 273/1999. imize the opportunities in both mature April 28, 2011. Safat) annual financial statements for the ❑ ❑ ❑ to countries with comprehensive, clear and emerging markets? Particulars (3 mths March 31, March 31, fiscal year ending Dec 31, 2010, dated Central Bank of Kuwait (CBK) and long-term energy policies aimed at 4. Energy challenges and the growing ending) 2011 2010 April 27, 2011. approved on April 27, 2011 the request Salhiya Real Estate Company incentivizing renewable energy use, need to diversify the energy mix mean Profit (Loss) (KD) 627,863 1,254,454 Particulars Dec 31, Dec 31, of Kuwait and Middle East announced completing subscription of its promoting efficiency and reducing car- that many supply chains will require EPS (LPS) (fils) 2.71 14.77 2010 2009 Financial Investment Comapny capital increase with total subscribed bon emissions. New technologies are reconfiguration, with an emphasis on Total current assets 8,084,587 7,132,232 Profit (Loss) (KD) (29,509,151) (16,136,030) (KMEFIC) to extend the period for shares of 100,403,432 shares, represent- also being developed to capture, store greater flexibility. Is your company Total assets 46,705,141 46,557,946 EPS (LPS) (fils) (38.22) (20.89) repurchasing or selling 10% maximum ing 98.94% so that total shares following and use spent carbon productively. ready to make this effort? Are you pre- Total current liab- Total current assets 38,962,309 68,006,140 of issued shares for additional six subscription amounts to 506,328,737 Companies make cleantech pared for the possibility of mandatory ilities 8,829,860 16,850,445 Total assets 141,864,900 186,429,281 months. shares. sustainability reporting? Total liabilities 21,493,423 37,931,306 Total current liabi- The company should comply with Therefore, the company will decrease a strategic priority Total equity 25,211,718 8,626,640 lities 48,451,133 58,337,469 CBK’s buyback regulations and rules, its capital by the amount of the unsub- Sensing commercial opportunity, ❑ ❑ ❑ Total income is worth KD 51,406 and Total liabilities 64,629,059 69,678,840 in addition to provisions of Article No. scribed shares amounting to 1,077,894 companies increasingly are building firstname.lastname@example.org total expenses from transactions with Total equity 76,984,533 116,446,818 115 bis of Corporate Law. It should also shares.