Tuesday, November 18, 2008

Congratulations Oman, on another National Day!

Yes, Oman this week celebrates their 38th National Day, as it's 38 years since His Majesty Sultan Qaboos took power from his father and started the task of taking Oman from what was then an unknown backwater stuck in the Middle Ages, to the modern developing country it is today.

I'd like to add my congratulations too.

May His Majesty continue to rule his country with success and wisdom for many, many, more years to come.

Enjoy the fireworks, parades, soak up the pride in your country, and during the holiday next week perhaps think about what you can do to make things better. Its not like HM can do it on his own.

I know some of my Omani readers think that sometimes I'm a bit too carping and critical about Oman's occasional foibles and problems, but I believe in the principal of an honorable opposition and in the value of criticism to lead to improvement. Sometimes a third party can see things that those blinded by nationalism cannot.

It was perhaps a nice present to read that Merrill Lynch thinks Oman's economy is the most robust in the GCC, and is among the world’s 10 least vulnerable economies. Although that's an opinion to be somewhat tempered by the fact that
(a) it's written by Merrill Lynch [hardly "one of the world’s leading financial management and advisory companies" any more], and
(b) contains places like Nigeria.

But still, better than our regional neighbors and certainly one of the nicest in the list too.

Happy National Day everyone. Try not to get too caught in the traffic!!

Merrill Lynch list of the world’s 10 least vulnerable economies
Oman has one of the world’s ten least vulnerable economies
Times News Service
Monday, November 17, 2008

MUSCAT — A major boost was given to Oman’s quest for foreign investment inflow at the weekend as the country was named among the least vulnerable economies in the world, according to a report, Global Economics, compiled by a team of experts from Merrill Lynch.

Oman is the only country from the AGCC which makes it to the elite list. Merrill Lynch is one of the world’s leading financial management and advisory companies, providing financial advice and investment banking services.

The report was compiled following several data requests from clients of the investment bank for key risk indicators for all major economies including Europe, the Middle East and Africa (EMEA).

According to the statistics, the world’s 10 least vulnerable economies are Nigeria, Mexico, the Philippines, Colombia, Egypt, Oman, Indonesia, Peru, China and Russia. Also, the report identified Australia, Switzerland, Korea, Romania, Hungary, Sweden, Bulgaria, Euro area, the United Kingdom and the United States of America as the highest risk economies in the world.

The risk ranking was based on seven indicators and they are — current account financing gap, foreign exchange reserves/short-term external debt ratio, private credit-to-Gross Domestic Product (GDP) ratio, and private credit growth, loans to deposits and banks capital-to-assets ratio.

Merrill Lynch said the report also addressed all the requests in 62 indicators of the 60 world economies.

Massive sell-offs in the regional stock markets early this week triggered panic selling on the Muscat Securities Market (MSM) as well.

“The MSM is oversold and the fall is overdone. Oil price crash is the reason behind the negative sentiment in the region. Oil price has fallen below $55 which has led to panic selling in the markets,” said Sunil Dhall, vice-president of Gulf Bader Capital Markets.

“The sentiment was completely negative across the board with all sellers and few buyers,” Dhall said. “Any fall below $50 will see a massive production cut by Opec and that level will be defendant,” he said.

Experts, however, continue to believe that the Omani macro story remains intact and the fundamentals are sound even with oil at the current price.

“We expect foreign inflows to resume once the stock markets worldwide stabilise. This is being witnessed in the stock market today where selective enquiries in stocks like Oman Cables, Voltamp Energy is being witnessed from overseas investors while bargain hunters continue to buy in frontline stocks like BankMuscat and Galfar Engineering,” industry experts say.


  1. any Idea why google image search is blocked?!!

  2. arrrrrr mateys, here be to another 35, arrrr

    -Omani in US

  3. 03.16.09, 05:56 AM EDT

    By John Irish
    DUBAI, March 16 (Reuters) - Bank Muscat shares surged for a second day on Monday on speculation Oman's biggest lender could sell a stake in India's HDFC Bank (nyse: HDB - news - people ) to give it cash to weather a possible rise in provisions this year.
    Bank Muscat shares were up 8.6 percent by 0925 GMT, having surged 10.8 percent on Sunday, as investors bet the bank could sell all or part of its near 3 percent stake in HDFC to raise funds before the end of the quarter.
    Officials of the Omani bank were not immediately available to comment.
    'I am of the very strong view that Bank Muscat will announce either part or complete sale of its stake in HDFC Bank before the end of the quarter,' Sunil Dhall, a vice-president at Muscat-based Gulf Baader Capital Markets, said in a research note on Monday.
    Gulf Baader said Bank Muscat held a 2.67 percent stake in HDFC, which would be worth 9.48 billion Indian rupees ($185.3 million) based on Friday's closing price of 834.55 rupees per share, according to Reuters calculations.
    Reuters data shows that the bank had 425.38 million shares outstanding as of March 5.
    'The profit on stake sale will flow through the income statements and this would give comfort to additional losses expected from investments during first quarter of 2009 in addition to providing comfort to its capital adequacy levels.'
    Bank Muscat's profit tumbled 83 percent in the fourth quarter as the bank booked impairment losses related to an investment in Pakistan's Saudi Pak Commercial Bank.
    Banks across the Gulf, the world's biggest oil-exporting region, have booked provisions for bad loans and written down investments as a global financial crisis and slump in oil prices brought to an end a regional economic boom late last year.
    'It started yesterday,' EFG-Hermes analyst Alaa El Din Moustafa said of the buying activity in Bank Muscat shares, the most-heavily traded of the day.
    'Everybody thinks it is about this bank (stake) sale in India, which is why the stock is moving,' Moustafa said.
    In February 2008, Bank Muscat said it had no plans to sell any stake in HDFC after the Indian bank agreed to buy Centurion Bank of Punjab.
    Bank Muscat owned about 14.02 percent of Centurion Bank, according to Indian stock exchange data at the time, which it converted into between 2.5 percent and 3 percent of HDFC after the agreed takeover.
    (Additional reporting by Saleh al-Shaibany in Muscat; Editing by Simon Jessop)
    ($1=51.16 Indian rupees) Keywords: BANKMUSCAT INDIA/SALE
    (john.irish@thomsonreuters.com; +971 4 391 8301; Reuters Messaging: john.irish.reuters.com@reuters.net)
    Copyright Thomson Reuters 2009. All rights reserved.


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