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					                                                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




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                                                                                                                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                                  ey.training@kw.ey.com        total expenses from transactions with              Total equity          76,984,533    116,446,818      115 bis of Corporate Law. It should also      shares.

				
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