Marketing major launches social media unit

Dubai-based marketing company BPG Group said on Wednesday it has launched a new dedicated social media business unit to expand its digital services.

Called BPG|Social, the company said the new unit will complement its integrated media solutions approach and move it “further into the digital landscape” following the launch of BPG Maxus in 2009 and BPG Possible in 2010.

BPG|Social will be based out of BPG Group’s headquarters in Dubai, and will have its own consolidated management team and community managers, the company said in a statement.

The new unit will start operations in October with clients such as MBC4, The Global Village, DEWA, RTA, Ellucian, and the Community Development Authority of Dubai. 

Commenting on the launch, Avi Bhojani, BPG Group CEO said: “Social media management has been traditionally offered through individual disciplines like media, PR, digital, advertising activation What is in fact needed is an integrated social media solutions approach.

“Today, we are launching BPG|Social, which will allow clients to enter into the social media conversation with their stakeholders, alongside existing traditional marketing solutions.”

BPG|Social general manager Noah Khan added: “Social media has enabled brands to engage and converse with their audience like never before.

“BPG|Social will work with our clients to tap into the brand’s fullest potential and create long and meaningful relationships in the digital social media space.”

He said BPG|Social’s primary challenge will be to “clearly communicate the benefits of social media and demystify the platforms to both current and potential clients”.

Speaking at the launch of BPG|Social, Ari Kesisoglu, managing director, Google MENA said: “As social media technologies develop, it is becoming increasingly important for companies to connect with customers in the right ways at the right moments.

“Thus it is very encouraging to see the formation of BPG|Social, who will be able to use their collective experience to provide integrated solutions in this area.”

BPG Group caters to a wide range of International, regional and local clients through an extensive network across the region with offices in Dubai, Abu Dhabi, Kuwait, Jeddah, Doha, Baghdad and Erbil.

Egypt urges legal action over US Prophet movie

Egyptian President Mohamed Mursi asked the Egyptian embassy in Washington to take legal action in the United States against makers of a film attacking the Muslim Prophet Mohammad, the official state news agency said on Wednesday.

Mursi had requested the mission take “all legal measures”, the MENA agency said, without giving further details on what that might involve.

Protesters who demonstrated outside the US embassy in Cairo on Tuesday had demanded action by the president.

Separately, Egypt’s Muslim Brotherhood called for a nationwide peaceful demonstration on Friday to condemn insults to Prophet Mohammad, a senior official said on Wednesday on the group’s website.

The statement followed a protest in Cairo on Tuesday in which some demonstrators scaled the US embassy walls and tore down the American flag over a film they blamed on the United States. The Egyptian government called the assault unjustified and said the US government could not be held responsible.

In Libya, Islamist gunmen killed the US ambassador in an attack on the Benghazi consulate prompted by the film.

Brotherhood secretary-general Mahmoud Hussein called for a “peaceful protest to condemn insults to religious convictions and insults to the Prophet”, adding it would start after noon prayers on Friday in front of main mosques across Egypt.

The group called for all Egyptian groups to join in. President Mohammad Mursi rose to power through the Brotherhood, although he formally resigned from the group on taking office.

The Salafi Call, an influential group of ultra-orthodox Salafi Muslim sheikhs, called for “suspending any cooperation between the two countries until (the US government) takes practical measures to stop this farce,” it said in a statement.

It did not say whether it supported the protest.

Obama vows to bring justice to killers of US diplomat

President Barack Obama vowed on Wednesday to bring to justice the killers of the US ambassador and three other diplomats in Libya as he sought to avoid election-year fallout from an attack that cast a spotlight on his administration’s handling of “Arab Spring” unrest.

Standing in the White House Rose Garden, Obama condemned the attack in Benghazi as “outrageous and shocking” but insisted it would not threaten relations with Libya’s new elected government, which took power in July after rebel forces backed by NATO air power overthrew Muammar Gaddafi.

The targeting of US diplomats in deadly militant violence sparked by a US-made film seen as insulting the Prophet Mohammad, could raise questions about Obama’s policy toward Libya in the post-Gaddafi era as he seeks re-election in November.

Obama, apparently seeking to seize the initiative in the aftermath of the attack, pledged to work with the Libyan government to “see that justice is done for this terrible act.”

“And make no mistake: justice will be done,” Obama said, with Secretary of State Hillary Clinton at his side. He ordered increased security at US embassies around the world, and a Marine anti-terrorist team was dispatched to boost security for US personnel in Libya.

Ambassador Chris Stevens and three embassy staff were killed late on Tuesday when Islamist gun attacked the Benghazi consulate and a safe house refuge in the eastern city of Benghazi, the cradle of last year’s uprising against Gaddafi’s 42-year rule. Another assault was mounted on the US embassy in Cairo.

Stevens, a 21-year veteran of the foreign service, was one of the first American officials on the ground in Benghazi during the uprising against Gaddafi last year.

Sean Smith, a foreign service information management officer, was identified as one of the diplomats killed. The names of the two others were withheld while the government notified their families.

Obama had hailed Libya’s election in July as a milestone in its post-Gaddafi democratic transition and pledged that the United States would act as a partner even as he cautioned that there would still be difficult challenges ahead.

In the series of Arab Spring uprisings that shook the Middle East last year, Obama opted for a cautious strategy that steered clear of a dominant role for the US military and drew criticism from Republican opponents at home for what was described as “leading from behind.”

Before the full death toll and details of the Libya attack were known, Obama’s Republican presidential challenger, Mitt Romney criticized the Obama administration’s initial response and he repeated the charge on Wednesday.

“It’s disgraceful that the Obama administration’s first response was not to condemn attacks on our diplomatic missions, but to sympathize with those who waged the attacks,” Romney told reporters in Florida.

Pushing back hard, Obama campaign spokesman Ben LaBolt criticized Romney for making a “political attack” at a time when the country was “confronting the tragic death of one of our diplomatic officers in Libya,” and Obama then reiterated condemnation of insults to the beliefs of others.

“We reject all efforts to denigrate the religious beliefs of others,” he said. “But there is absolutely no justification to this type of senseless violence.”

Immediately after his speech, Obama, who was due to leave later in the day on a campaign trip to Nevada, visited the State Department to express solidarity with US diplomats around the world.

The Libya crisis has come at a time when the spotlight was already on the Middle East amid escalating tensions between Obama and Israeli Prime Minister Benjamin Netanyahu over how to deal with Iran’s nuclear programme.

Clinton said the Benghazi attack was the work of a “small and savage group” and that US-Libyan ties would not suffer.

But she seemed to take note that Americans might resent such an attack on US personnel in a North African country they helped to bring out from under long authoritarian rule.

“I ask myself, how could this happen? How could this happen in a country we helped liberate, in a city we helped save from destruction?” Clinton said. “This question reflects just how complicated and, at times, how confounding the world can be.”

Kuwait’s Agility sees growth in Arab Spring states

Kuwaiti logistics firm Agility says it is gearing up for expansion in emerging markets, much of it in countries that experienced Arab Spring political upheavals as new governments there spend more on their oil industries and infrastructure.

The group was the largest supplier to the US Army in the Middle East during the war in Iraq, but is changing tack and putting less emphasis on defence services, chairman and managing director Tarek Sultan told Reuters in an interview.

He said the company was in talks with the new governments in Egypt, Tunisia and Libya on increasing its presence and investments.

“You think of Libya, you think of oil and gas and infrastructure, including roads, ports, warehouses,” Sultan said. “In Egypt there is a consumer market, there are some oil and gas activities, normal freight forwarding, warehousing and there is a lot in real estate.”

Agility’s strategy shift is not just down to confidence in these growth markets. The group is barred from bidding for new US government business, pending the outcome of a legal dispute with the United States, and pleaded not guilty in August last year to charges it defrauded the U.S. government over multi-billion dollar supply contracts.

However, its Kuwait-listed shares have climbed 24 percent since the end of last year, hitting their highest level for 20 months. Global Investment House, a local brokerage, said interest in the stock had been boosted by investors’ hopes that Agility would win a claim filed against the U.S. Defense Logistics Agency (DLA).

Agility filed a $225m claim against the DLA in April, saying the agency had breached the terms of a contract for food distribution to combat units.

In future, the company is likely to be less vulnerable to large-scale disputes with governments.

“In practice now all of our revenues are basically commercial revenues. So we do have some government work (but) it is limited – in general we are focused on commercial customers,” Sultan said.

Agility, the largest Gulf Arab logistics company, expects new governments in the region, under pressure to reduce unemployment, to introduce policy changes that produce more private-sector jobs and reduce red tape.

“In the short term, decision-makers will obviously focus on things other than business, but at the same time the signs that we are seeing out of Egypt … are positive and I think the government is saying the right things and starting to do the right things,” Sultan said.

“So hopefully we will be able to have a very positive dialogue with governments once the dust has settled, and they get to turn their attention to the task of creating jobs and opportunity for their constituents.”

Agility, which is present in more than 100 countries, sees opportunities created by the Arab Spring as part of a trend towards emerging market business, beyond more developed economies in the West and the Gulf.

“There is some kind of shift in focus towards emerging markets. Countries including India, China, Brazil, Australia, Pakistan and the Middle East make up almost 60 percent of our revenues. This percentage will increase naturally,” Sultan said.

The group in July won a two-year contract worth $238m to supply logistics support to the Gorgon natural gas project in Australia. It also obtained a two-year extension of an existing contract with Gorgon worth $262m.

Agility last month posted a profit of KD7.82m ($27.7m) for the three months to June 30, against KD7.83m in the year-ago period.

Gulf OPEC producers keen to see $100 oil

Gulf OPEC producers would like to see oil prices fall to around $100 a barrel because they fear current high prices could hit longer-term demand, Gulf OPEC delegates said on Tuesday.

Since OPEC ministers last met in June, Brent crude oil prices have surged about 20 percent and have hovered around $112-$117 a barrel since mid-August despite fragile economic growth in many consuming countries.

“A price above $100 can harm the global economy and is not good news,” said one Gulf OPEC delegate, adding “so prices need to come down to around $100 a barrel.”

Saudi Arabia’s Oil Minister Ali al-Naimi said on Monday he was worried about high oil prices and that the top oil exporter would try to moderate them.

Lower supplies from Iran because of sanctions and outages in the North Sea have driven up crude prices in the last few weeks despite fears that Europe’s deep economic problems might weigh on industrial activity and demand in Asia.

Gulf OPEC price doves – Saudi Arabia, the United Arab Emirates and Kuwait – have long feared that very high oil prices could reduce demand for their main export product by slowing economic growth and driving consumers to look for alternatives.

“It’s agreed that the current price is too high and I believe that a price of around $100 is fair for consumers and producers,” said a second Gulf OPEC delegate.

The remarks echo comments in May by Naimi that a price of around $100 a barrel would be “great” for Saudi Arabia.

In contrast, OPEC price hawk Iran, which needs high oil prices to compensate for lower sales volumes under Western sanctions, said on Monday oil prices were still too low.

Iranian Oil Minister Rostam Qasemi said oil prices will still increase in the coming months due to lower oil output from North Sea oilfields in Europe.

Qasemi’s comments highlight the rift between Iran and Gulf producers who have increased their production this year to help make up for lower exports from Iran due to tightening Western sanctions over Tehran’s disputed nuclear programme.

Although Saudi crude supply to the market remained steady at 9.8 million barrels per day (bpd) in July and August, off multi-decade highs of over 10 million earlier in the year, the big three Gulf OPEC producers collectively increased supply by around 400,000 bpd thanks to a 600,000 bpd jump in Kuwaiti production to 3 million bpd.

US administration officials met energy analysts at the end of last week in a meeting interpreted by some as a sign that President Barack Obama was considering tapping US government oil supplies in a bid to bring down fuel prices.

L’Hotel Bahrain ‘devastated by 2011 unrest’

The recently closed L’Hotel Bahrain had been devastated by 2011’s unrest in the country, its general manager Ralph Yazbeck has said.

“The decision to shut down comes as a direct result of last year’s unrest. Indeed, the hotel suffered major losses, almost BD1m ($2.65m),” Yazbeck said in comments published by Hotelier Middle East.

The hotel, known as ‘Bahrain’s first luxury boutique hotel’, is operated by the owner, Hotel de L’Hotel, a local Bahraini company.

Yazbeck added that the management is currently in discussions regarding the possible re-opening of the property, but its “future should be decided within the next six weeks”.

“There’s absolutely no issue about renewing [the commercial registration]. It’s simply a question of having the board of directors meet and take a few decisions, such as increase of capital, etc…,” Yazbeck said.

He added that the registration could be renewed within a day, and from the time of taking a decision, the hotel could be fully operational again within 60 days.

He said that “staff that used to work at L’Hotel and chose to come back are more than welcome”.

MAF says spending at its Dubai malls up 10%

Spending at Dubai malls owned by Majid Al Futtaim (MAF) is up 10 percent as the Arab Spring and economic woes in Europe draw immigrants and tourists to the emirate.

“The Arab Spring has been positive for Dubai because a lot of Gulf-based people who used to go to Lebanon or Egypt have identified Dubai,” chief executive Iyad Malas told the Reuters Retail and Consumer Summit on Tuesday.

MAF, the franchisee for Carrefour hypermarkets in 19 countries and operator of 11 malls across the Middle East and North Africa, including 6 in the UAE, expected to maintain double-digit revenue growth in 2012, he said.

Its Dubai retail tenants saw a 15 percent increase in footfall in the first half and 10 percent growth in sales, Malas said. “(In) Egypt … tourists are coming to see the Pyramids, the Nile. Few are going to shop. Whoever visits Dubai has at least two malls to visit.”

The emirate’s population has been swelled by people seeking refuge from political strife in the Middle East and economic malaise in Europe, which is also supporting retail sales.

“If you look at the profile of the people moving to Dubai it is people with money who are either worried about the political situation in places like Syria or Egypt or wherever it might be,” said Malas.

“There is new interest coming out of Italy, Spain and some of the southern European countries.”

Retail accounted for nearly a third of Dubai’s gross domestic product in 2011, with the emirate positioning itself as the shopping capital of the region a place to buy designer clothes, luxury watches, top-end cars and gold-plated mobile phones.

The global economic downturn in 2008 led to a drop in tourists visiting the emirate and dampened demand for luxury goods. “People with wealth were maybe a little bit scared at the beginning, but then continued to spend strongly,” Malas said.

MAF’s gross revenue was up 10 percent in 2011 to AED19.6bn, while operating profit rose 19 percent to about $750m, said Malas, adding this year’s growth was likely to be similar.

Trafigura takes $400m loan from Gulf banks

Commodities trader Trafigura has taken a $400m loan from a group of Middle Eastern banks, as the group looks to diversify its lending pool at a time of stress in traditional banking spheres, banking sources said on Tuesday.

The one-year revolving credit facility was arranged by BNP Paribas and involved 11 Gulf Arab banks joining the deal, which was signed at the end of August, said the sources, who spoke on condition of anonymity as the information isn’t public.

The loan was part of a strategy by Trafigura, which says it is the world’s third-biggest trader of raw materials, to develop pools of lenders in different parts of the world to help diversify its funding sources, a banker with knowledge of the deal said.

“Before, the pricing they could get from international relationship banks meant they didn’t have to expand too far from them, but now they are looking at other sources,” said a second source, whose bank joined the transaction.

“The facility will finance our local inventories and shows our continued commitment to the region,” said Christophe Salmon, CFO EMEA, Trafigura Beheer, confirming the deal.

The push into new banking markets by international companies reflects both the stressed funding conditions for Western banks, which has restricted their lending operations, but also the growth of emerging market lenders in areas like the Middle East into global brands.

For example, Qatar National Bank’s market capitalisation of $25.5 billion is larger than either Royal Bank of Scotland or Societe Generale, at $25 billion and $24.3 billion respectively.

“Local banks love to do deals with international corporates, if there is a regional angle and an underlying structure which they can get comfortable with,” the second banker said.

The loan, a refinancing of Trafigura’s debut loan targeting regional lenders signed in August 2011, is structured as a borrowing base facility – meaning the loan is backed by collateral, the value of which never falls below the amount lent or a percentage of the figure agreed beforehand.

The banks which joined the facility were: Arab Petroleum Investments Corp, Arab Bank, Abu Dhabi Commercial Bank, Ahli United Bank, Commercial Bank of Qatar, Doha Bank, First Gulf Bank, Gulf International Bank, Mashreq and Union National Bank, the first source said.

Oman jails six men for internet slander

An Omani court sentenced six people to jail terms ranging from a year to 18 months for slander over internet posts against the government that it called “abusive and provocative”, an opposition activist present at the hearing said on Monday.

The verdict, issued on Sunday, was a further move by Oman to deter unrest inspired by Arab Spring revolts last year.

Protests this year in Oman, which fronts the Gulf sea lane through which much of the world’s oil trade is shipped, have highlighted difficulties in implementing a strategy of defusing discontent by creating tens of thousands of public sector jobs.

The six men were also accused of “violating information technology regulations” and were fined OR1,000 ($2,600) each, the state news agency ONA reported.

Rulings in other, similar cases are expected on September 16, the agency added.

Activist Ahmed bin Said, who was present at the hearing, said the defendants had criticised the government for not making public the names of officials who are under corruption investigation.

Around 12 Omanis were sentenced to up to a year in jail last month for illegal gathering and some 18 people were handed similar prison terms over Internet posts deemed as “incitement” against the government and comments directed against Omani ruler Sultan Qaboos.

The comments against Sultan Qaboos – in power for 42 years and now the longest-serving Arab head of state – were made during protests in late May that grew out of strikes in the oil sector, which accounts for most state revenue.

The sultan promised thousands of jobs and unemployment benefits in response to last year’s disturbances.

Perceived failures and delays in making good on such promises were rallying cries in the recent protests, which saw anger directed against the once-sacrosanct figure of the sultan.

Oman’s public prosecutor pledged to prosecute such statements under its information technology law, which formed the basis of the latest rulings as well as the earlier verdicts.

Oman’s Al Izz poised for $104m share float

Al Izz Islamic Bank, the second sharia-compliant lender being formed in Oman, will launch an initial public share offer (IPO) for 40 percent of the bank later this month, Oman’s regulator said in a statement on Monday.

Al Izz is the second Islamic bank to seek a stock market listing in Oman since the sultanate reversed its position last year as the only country in the Gulf Arab region not to permit sharia-compliant banking.

The bank, which counts Abu Dhabi state-fund Aabar Investments as a founding shareholder, aims to raise OR40m ($104m) through the offer which will open on Sept. 22 and run for one month, the Omani Capital Markets Authority said.

In June Bank Nizwa raised 60 million rials in an IPO that was 11 times oversubscribed. The shares have risen 3 percent since then.

Shares in Al Izz’s offering will be priced at 0.1 rials each and are open to both local and foreign investors, although the latter can only be allocated up to 70 percent of the offering.

The offer will be managed by Bank Muscat with the shares due to be allotted on a 60/40 split between retail and institutional investors, although that ratio could change according to demand.

A single institutional investor can subscribe to a maximum of 10 percent of the overall offer, the statement added.