The multi-award winning Arabian magazine
Gulf Financial Insider
GulfInsider The Arabian Review
Issue 103
Bahrain
Signs of Real Estate Recovery
Dubai
Expat Marriage Meltdown
Bahrain
Why Smarter Government Benefits All
Interview
Indian Ambassador to Bahrain Dr. Mohan Kumar
Indian Business in Bahrain Indian expatriates’ role in the trade history of Bahrain
Bahrain BD2
KSA SR20
Kuwait KD1.75
Oman RO2
Qatar QR20
UAE DHS20
turkishairlines.com | bahcustomer@thy.com | 17516100
Voted Europe’s Best Airline 2013 at the Skytrax Passenger Choice Awards.
Gulf Financial Insider
GulfInsider
August 2013 more inside...
India – Bahrain Bilateral Relations
Special Features
Cover Story
10
Contents 16
Asset Management
42. Maserati
The 2014 Quattroporte
26
Why are there so many crooks?
USA
18
36
Smarter Government
Expat Marriage Meltdown
Bahrain
The search for world domination
Dubai
25. Hospitality
New Ramee Grand Hotel & Spa
44. Cars
Bently Mulsanne
22
39
First small signs of recovery
Female Professionals
Bahrain
Middle East
46. MENA
Online consumer behavior
47. Techpicks Are you a player?
Gulf Financial Insider
GulfInsider
Comments... There may be trouble ahead… Today’s financial system is dominated by central bankers who have been awarded nearly dictatorial control of global money supply. In allowing them to set interest rates, they are able to control the ‘price’ of money, thus controlling the price of... everything. This power rests primarily in the hands of four men who control roughly 75% of the entire world money supply: Zhou Xiaochuan, People’s Bank of China , Mario Draghi, European Central Bank, Haruhiko Kuroda, Bank of Japan, and Ben Bernanke, US Federal Reserve Four guys. And they control the livelihoods of billions of people around the world. So, how are they doing? In theory, a central bank is like any other bank. It has income and expenses, assets and liabilities. Lehman Brothers famously went under in 2008 because they had insufficient capital. They had assets of $691 billion, and equity of just $22 billion... about 3%. This meant that if Lehman’s assets lost more than 3% of their value, the company wouldn’t have sufficient cushion, and they would go under. This is exactly what happened. Their assets tanked and the company failed. So let’s apply the same yardstick to central banks and see how ‘safe’ they really are: US Federal Reserve: $54 billion in capital on $3.57 trillion in assets, roughly 1.53%. This is actually less than the 1.875% capital they had in December. So the trend is getting worse. European Central Bank: 3.69%, Bank of Japan: 1.92%, Bank of England: 0.843%, Bank of Canada: 0.532%. Each of these major central banks in ‘rich’ Western countries is essentially at, or below, the level of capital that Lehman Brothers had when they went under. What does this mean? Think about Lehman again. When Lehman’s equity was wiped out, it caused a huge crisis, and almost everyone who was a counterparty to Lehman Brothers lost a lot of money because the company could no longer pay its debts. Accordingly, if the US Federal Reserve’s assets unexpectedly lose more than 1.5% of their value, the Fed’s equity would be wiped out. This means that any counterparty holding the Fed’s liabilities (i.e. Federal reserve notes) would lose. More specifically, that means everyone holding dollars. Theoretically if a central bank becomes insolvent, it can be bailed out. There’s just one problem with that thinking. Governments in the US, Europe, Japan, England, etc. are all too broke to bail out their central banks. These governments are already insolvent. So there won’t be anyone to bail them out. The multi-award winning Arabian magazine
This copy not for sale BAHRAIN EDITION
Gulf Financial Insider
GulfInsider The Arabian Review
Publishers Nicholas & Rebecca Cooksey Editor in Chief Nicholas Cooksey Assistant Editor Melissa Nazareth Layout Designs Dhanraj S Admin & Finance Nikesh Pola Sales Account Manager Chelsea Copenhaver Business Development Manager Sueallen Menezes Redia Castillo Editorial Contributors Nicholas Cortes Ramzy Baroud Amy Vaya Richard Koch Piers Grimley Evens Rob Howard Colin Freeman Printed at Awal Press, Kingdom of Bahrain. Distribution Bahrain Al Hilal Corporation, Tel. +973 1748 0800 UAE Jashanmals, Tel. +971 4341 9757 Published by:
A Division of C.G. Arabia W.L.L.
GulfInsider
P.O. Box 26810, Kingdom of Bahrain Fax: +973 1772 1722 Off No. 52, Floor No. 5, Building No. 741 Road No. 3616, Block No. 436 DCR Business Centre in Seef Adjacent to BAPCO petrol station Seef District www.ArabianMagazines.com Ministry of Information approval no. TFI-431© Copyright 2009. Arabian Magazines is a division of CG Arabia WLL. No part of this publication may be reproduced in any manner without the written permission of the publisher. All Rights Reserved. Views expressed in this magazine are not necessarily those of the publisher.
Issue 103
Bahrain
Signs of Real Estate Recovery
Dubai
Expat marriage meltdown
Bahrain
Why Smarter Government Benefits All
Interview
Indian Ambassador to Bahrain Dr. Mohan Kumar
*Articles by these correspondents are the copyright of
Telegraph Media Group, 111 Buckingham Palace Road, London SW1W 0DT, England.
Indian Business in Bahrain Indian expatriates’ role in the trade history of Bahrain
Bahrain BD2
KSA SR20
Kuwait KD1.75
Oman RO2
Qatar QR20
UAE DHS20
Visit...www.gulf-insider.com for more interesting features and news...
For advertising enquiries call Chelsea Copenhaver M. +973 3678 8748 E-mail: sales@gulf-insider.com info@gulf-insider.com
innovation and value, our DNA
At VIVA, we are passionate about providing our business partners with innovative and cost effective solutions that encompass Internet, data connectivity, mobility and ICT. Our commitment is ingrained in our DNA and it defines us as a company. viva.com.bh
Inbox Readers’ Letter
Send your views to gulfinsider@ArabianMagazines.com The multi-award winning Arabian magazine
Gulf Financial Insider
GulfInsider The Arabian Review
Issue 102
Volatility -
a new asset class?
4 experts reveal why they believe central banks retreat from stimulus programs will create significant market volatility for years to come.
UAE
Hospitality Market
Abu Dhabi
New Financial Free Zone $25 Million Adastra
KSA SR20
Kuwait KD1.75
Oman RO2
Qatar QR20
UAE DHS20
The multi-award winning Arabian magazine
Gulf Financial Insider
GulfInsider The Arabian Review
Issue 101
100 Leaders in Bahrain - Part 2
Bahrain BD2
KSA SR20
Kuwait KD1.75
Oman RO2
Qatar QR20
Saving Joe Thompson
Kindness To Khadamas
Mohammed, Budaiya
Reader
The case of Joe Thompson is a very sad one. Not only is the young boy loosing precious time because his life including his studies and family ties, have come to a stand still; in addition the financial strain on the family is a lot; one can’t even begin speaking of the emotional turmoil. The British Embassy in Abu Dhabi as well as the concerned authorities in Abu Dhabi must make a joint effort to help this family.
Your story on child labour has brought out the negativity of this menace, aptly. Nevertheless, I have something to add and would like to share it through this letter. Sometimes we don’t decide our fate; for instance, poverty is something that is ‘maktoob’. Now, if this child is destined to work as domestic aid at least he or she gets basic physiological needs. It is definitely sad that they don’t get an education and other rights that every child deserves. But it’s better to get the basic needs and kindness from a family than await your death in extreme conditions. All this is only applicable to families who treat khadamas humanely.
Car ‘Lift’!
UAE DHS20
The multi-award winning Arabian magazine
GulfInsider
Gulf Financial Insider
The cover page of Gulf Insider’s July ’13 issue took me by surprise! I mean, Arabian Magazines has always been known for it’s quirky covers and if I’m not wrong you guys even won an award for that; but it was great how you guys portrayed the economic concept of volatility with a fun image of the foot slipping over a banana peel. Keep up the good job! Rupert, Juffair
Superyacht
Bahrain BD2
Judge A Book By It’s Cover!
The Arabian Review
to our Welcome
sue
100th Is
Special Feature
I was shocked to read about the Dubai Police Sergeant who stole cars and reported bogus thefts. True that greed is a bottomless pit! I mean, weren’t the patrolling cops in Dubai given supercars? What irony! Reader
100 Leaders in Bahrain - Part 1 Bahrain Marketview 2013
Investing Luxury Real Estate
Technology 4G Comes to Bahrain
Abdul Razak Jawahery
Chairman of Menatelecom on 4G & Bahrain’s Telecom Industry Bahrain BD2
6
KSA SR20
Kuwait KD1.75
Oman RO2
Qatar QR20
UAE DHS20
Gulf Insider August 2013
Would you like to be a PUBLISHED Photographer? If your photos of Bahrain and the region are good enough, they could be published in Gulf Insider/Areej/Bahrain Confidential magazines. Each month we publish the most impressive images we receive and give full credit to the photographer. Images must be at least 1mb and can be e-mailed to submissions@ArabianMagazines.com with the subject ‘PHOTO’.
Bahrain
Gulf Round-up Fitch upbeat on Bahrain’s economic recovery Positive steps have been taken towards resolving the domestic political stalemate in Bahrain, Fitch Ratings has said in a new report as it affirmed the country’s long-term ratings. Fitch affirmed the Gulf kingdom’s long-term foreign currency issuer default rating (IDR) at ‘BBB’ with a stable outlook. The rating agency noted that a national dialogue had restarted with the reformist Crown Prince promoted to First Deputy Prime Minister. “However, progress has been slow and low-level violence continues,” it said in the report. Fitch said growth has rebounded after the political unrest in 2011, picking up to 3.4 percent in 2012 from 1.9 percent the year before. “The normalisation of oil production, after technical problems, should allow growth to strengthen to 5.5 percent in 2013. Capital spending, manufacturing investment and a further recovery in tourism will support non-oil growth of around 3.5 percent,” The report added. Fitch said fiscal deficits pushed the debt-to-GDP ratio to 36.6 percent of GDP at the end of 2012, on par with the ‘BBB’ median. Fitch said it expects debt-to-GDP to be above the peer median by end-2014. However, owing to government deposits in the banking sector worth 18 percent of GDP, net debt-to-GDP is forecast to remain significantly below the ‘BBB’ median, it added. “At 3.2 percent of GDP in 2012, the general government deficit is greater than the ‘BBB’ median. Savings to capital expenditure resulting from the use of GCC development funds are forecast to lower the deficit to 2.1 percent of GDP in 2013,” the report said. It added that tackling wages and subsidies (around 60 percent of total spending) would be challenging in the current political environment. The external position is much stronger than ‘BBB’ rated peers, Fitch said, with a current account surplus of 12.1 percent of GDP projected for 2013, which will be the 10th consecutive year that a surplus has been recorded. Bahrain’s overall net creditor position, 81.1 percent of GDP at end2012, is the strongest of any similar-rated sovereign, Fitch added. “GDP per capita and broader human development and business environment indicators are close to the ‘A’ median,” its report said. Fitch said the stable outlook reflected its assessment that upside and downside risks to the rating are currently well balanced.- ARABIAN BUSINESS
8
Gulf Insider August 2013
Bahrain set to scrap quota system on jobs Bahrain’s Labour Ministry has proposed scrapping the quota system that dictates how many nationals private companies must hire and introducing a qualitative-based scheme that focuses on the quality of jobs offered to locals. Under the proposed scheme, hiring a professional Bahraini would be considered equal to a certain number of unskilled jobs. Companies that met the targets would receive benefits, Labour Minister Jameel Humaidan told local media. “The more the job is needed and required by Bahrainis, the more it weighs for the company to get benefits from the Labour Ministry,” Huamidan said. “If a company offers a managerial job, for example, to a Bahraini, it is not treated as a regular job. Therefore, the company’s benefits will be double due to the grade of the job which is considered in place of three or two jobs, for example. “With this system, we can solve the gap found between demanded jobs and those offered in the market.” Humaidan said Cabinet had approved the new system and directed the ministry to fast-track its implementation. “It covers many enterprises which do not need the Bahrainisation system as a commitment, but seek it to improve its situation to benefit from the available national market capabilities and ministry’s services,” he said. Sectors that are not attractive to Bahrainis, such as construction, beauty and cleaning, and therefore struggle to meet the set quotas, would be re-evaluated. “It first needs to be ensured that such companies cannot meet their commitments of the system,” Humaidan said. “The re-evaluation will be held with the participation of the Bahrain Chamber of Commerce and Industry.” – ARABIAN BUSINESS
Business News
Bahrain biggest ever souq set to attract 20,000 shoppers per day Bahrain will open its biggest ever traditional souq, which organisers forecast will attract up to 20,000 people a day, it was reported. The 18,000sqm souq will open at the historic area of Hunniniyah Valley and will feature 80 indoor and outdoor stalls selling traditional clothing, perfumes and scents, food and handicrafts, according to a report by the Gulf Daily News. Set to be the biggest of its kind in Bahrain, it will operate at weekends from 9.30pm until midnight. “At the moment, exhibiting products is free and we want to attract as many merchants as possible to the market, which is also located in a unique historic natural site in the middle of the governorate,” municipality director-general Asem Abdullatif was quoted as saying. The municipality said it had spent BD25,000 setting up the stalls and it was the result of three years of development. – ARABIAN BUSINESS
Jaguar Land Rover: 40% Growth across MENA Luxury automotive manufacturer Jaguar Land Rover has recorded significant year on year (YOY) sales growth of 40% across the Middle East and North Africa (MENA) during the first quarter, from April to June 2013 inclusive. Land Rover demonstrated its growing popularity in the region with a YOY increase of 43%, due mainly to the success of the All-New Range Rover. Other key sales performers were the Range Rover Evoque and the Land Rover LR4, which went up by 28% and 17% respectively. Sales of the multi award-winning Jaguar XF increased by 45%, along with the Jaguar F-TYPE, which stimulated a sharp sales incline across the region during its May 2013 start of sales campaign.
Fifth of UAE firms cut executive business travel - poll The American Express Middle East Corporate Spending Survey, conducted by YouGov and which surveyed corporate expense managers in the UAE, found that, following the financial crisis, 70 percent of participants said their companies are now “more financially conservative”. Some of the areas where corners were cut include executive travel and expenses. The research found 27 percent of UAE firms have reduced executive travel, a fifth have reduced business class travel and the same number (20 percent) have reduced daily allowances for executives. However, only three percent of respondents said they had cut back on corporate hospitality during the last six months, indicating the continued importance of corporate hospitality in the UAE. As part of the cutbacks, the research found 53 percent of participants said they have renegotiated contracts with suppliers in the last six months, 33 percent have introduced new corporate expense policies and 27 percent have reduced the number of expenses which can be billed back to the company. “A clear consequence of the financial crisis is that companies in the UAE have become much shrewder and more informed when it comes to controllable expenses,” said Mazin Khoury, CEO of American Express Middle East. “It is not so much that companies are solely focused on reducing their costs, rather, their overriding objective post the crisis appears to be a desire to extract the maximum value out of every dirham they spend.” Looking to the future, 47 percent of UAE participants said they expected expenditure to increase this year. - ITP Gulf Insider August 2013
9
Special Feature Business Partnership
An Ancient Partnership B A look at the historical ties between Bahrain and India, and their relevance today.
ahrain and India have always enjoyed excellent bilateral relations. Their centuries-old political, cultural and economic exchanges have benefited both nations and created a great deal of goodwill between their people. Bahrain has naturally been an important port of call for merchants, owing to its strategic geographic position. Indians from the ancient Harappan civilisation are known to have come to Bahrain as early as 3,000 BC on their way to Mesopotamia in pursuit of trade. It is 10
Gulf Insider August 2013
suspected they built the Anzac temple in Dilmun, as Bahrain was known then. When the state of Bahrain was created in the seventeenth century, maritime trade with India was a boost to its fledgling economy. Under the rule of Bahrain’s first ruler, Shaikh Ahmad Al Fateh (1783-1795), the Utoob tribes were encouraged to buy ships in order to export pearls directly to the Indian port of Surat. The famous Bahraini pearls were drilled here and exported further. The tribes were also able to bring in their annual imports and goods from India. So
pervasive was the effect of this trade that Indian rupees were used as legal tender in Bahrain until 1965, when its own currency was created. By the end of the nineteenth century, Bahrain had attracted a number of enterprising merchant families from India who initially traded dates and eventually moved on to small-time retailing. From the Sindh province came textile merchants, and from the Kathiawad region in Gujarat came jewellers. By 1925 around 2,500 Indian families had settled in Bahrain, many of which are
Business Partnership Special Feature
Bahrain is poised to become a regional hub for Indian businesses seeking to tap into the vast US market, owing to its recent free trade agreement (FTA) with the US. still here today. Although these Indian settlers are apolitical, they have exercised a subtle influence on Bahrain’s fashion, cuisine and language. It is still common to see women wearing jalabiyas made out of silk sarees, and quite a few Arabic words used in Bahrain are borrowed from Indian languages. When Bahrain’s economy expanded with the discovery of oil in 1932-45, Indian professionals were attracted by opportunities to work as managers, accountants, etc. Today, the 350,000-strong Indian workforce constitutes more than one-third of Bahrain’s population, and is by far the largest expatriate workforce in Bahrain. They can be found at all levels, from construction and maintenance personnel, to highly skilled professionals such as doctors and engineers. There is traffic in the reverse direction too. Bahrainis have long been attracted to India, not just for business, but also for vacations, higher education, and affordable, quality health care. Many of Bahrain’s most prominent figures have received university educations in India. For example, Ebrahim Al-Arrayedh, generally considered to be one of Bahrain’s greatest poets and one of the leaders of the Bahraini literary movement in the 20th century, grew up in Mumbai and studied at Aligarh Muslim University. Former Minister of Labour Abdulnabi Al Sho’ala, who also studied in India, went on to found the Bahrain India Society in December 2007. The Society aims to strengthen the friendship between the two peoples and to promote links in the fields of economics, culture, sports, and science. Other notable institutions include the India Bahrain Joint Committee on Economic and Technical Cooperation founded in 1981, the Joint Business Council (1994), and the ESCEDB Information Technology Agreement (2001). All of these are high-profile efforts, endorsed by senior politicians of both nations, to encourage entrepreneurship
and the exchange of ideas and information. Dr. Mohammad Abdul Ghaffar, the King’s advisor for diplomatic affairs, and Chairman of the board of trustees of the Bahrain Centre for Strategic, International and Energy Studies, has said that the two countries must “develop economic alliances that distance themselves from hegemonic ambitions and military rivalries that characterised the era of western dominance.” Bahrain is poised to become a regional hub for Indian businesses seeking to tap into the vast US market, owing to its recent free trade agreement (FTA) with the US. Indeed, recent years have seen an influx of Indian investment in Bahrain. India became the third state to hold talks on bilateral trade with the GCC, and a GCCIndia FTA is expected to be concluded within a year. This will further strengthen economic ties and encourage Bahraini investments in India and vice versa. The Indian market, with its enormous potential for growth, represents the next frontier for Bahraini businesses. The volume of trade between India and the GCC was more than $118 billion in 2010-2011 and is expected to exceed $130 billion in 2013-2014. This long tradition of synergy has made Bahrain and India natural political allies as well. Bahrain has drawn on India’s experience with democracy, and has been the staunchest supporter of India’s candidacy for a permanent seat on the UN Security Council. Bahraini officials have urged India to play a greater role in international affairs. For instance, over concerns about Iran’s nuclear programme, Bahrain’s Crown Prince requested India to play an active role in resolving the crisis. The future will only see stronger cooperation in all areas between Bahrain and India. The concerted efforts of the two governments, as well as the cordial relationship between the people, will ensure that this continues to be a fruitful and mutually beneficial relationship. GFI
Gulf Insider August 2013
11
Special Feature Indian Ambassador
Interview with Indian Ambassador to bahrain
Dr. Mohan Kumar Gulf Insider sits down to talk about bilateral ties including trade, commerce and investment between India and Bahrain with India’s Ambassador to Bahrain.
12
Gulf Insider August 2013
Indian Ambassador Special Feature
W
hat has been your primary focus during your time as India’s Ambassador to Bahrain? What are some of the things you have achieved? When I arrived in late 2010, I set myself three goals: ¡ To take the political relationship to the next level; ¡ To strengthen cultural and people-to people contacts; and ¡ To build new Chancery premises for the Embassy. I am happy to state that the two visits undertaken by His Royal Highness Prince Salman bin Hamad Al Khalifa, the Crown Prince, Deputy Supreme Commander of Kingdom of Bahrain and the First Deputy Prime Minister to Mumbai and Delhi in 2012 and to Kerala in 2013 has given fresh impetus to bilateral ties and taken the political relationship to the next level. A series of excellent cultural programmes have been conducted under the “Irressitible India” series which has helped showcase Indian culture to the Bahraini public. People to people contacts have also been strengthened. A new Chancery building is definitely on the cards and I confidently expect the foundation stone to be laid before the end of this year. At this point in time, the bilateral trade relationship is working below potential. Currently, bilateral trade is equal to USD 1.2 billion, which does not do the potential justice – it could be at least twice this. Despite that, there have been several specific successes, such as acquiring a banking license in India for BBK, bringing several Indian banks, including Canara Bank, to Bahrain, and achieving a first in the Gulf in having an Indian company complete a major intersection in Mina Salman. Now, the focus of the Embassy is to promote Joint ventures. To this end, a Bahrain India Trade and Investment Exhibition/Conference is being organized at the Bahrain Exhibition Centre from 22-24 October, 2013. In 2012, a high level trade delegation travelled to India. In your opinion,
what was achieved and how have things developed since? During the visit, major industrial houses and business bodies from both countries had the opportunity to interact face to face and discuss issues of mutual interest. A decision was taken by the Bahrain Chamber of Commerce and Industry and the Federation of Indian Chamber of Commerce and Industry to set up a Bahrain India Business Council which will meet periodically and work towards enhancing the economic and commercial cooperation between the two countries to a higher level. Another business body of India, Confederation of the Indian Industry also
There have been several specific successes, such as acquiring a banking license in India for BBK, bringing several Indian banks, including Canara Bank, to Bahrain. signed a Memorandum of Understanding with Bahrain Chamber of Commerce and Industry. An agreement between the Governments of the Republic of India and the Kingdom of Bahrain was signed to exchange information with respect to taxes, which has become operational since then. There is vast potential in trade and investment between India and Bahrain. How can that potential be better realized? Bahrain could take full advantage of economic strides made by India in the last two decades. Bahrain’s imports are at present confined to age-old commodities
like fashion, jewellery, and food. While India, besides refined petroleum/oil, from Bahrain imports liquid ammonia, processed steel, iron, brass and aluminum. India has made significant progress in other sectors recently like ICT, higher technical education, medical tourism, etc, and these areas need to be explored by Bahrain. What have been the greatest achievements between the two countries in recent years? What are the challenges that you are currently facing? As for achievements, I think this has been the ability to maintain and strengthen civilizational links between the two countries. These links have flourished for hundreds of years, from the time of Dilmun, to the pearl traders coming from Bahrain to India, and then migration of labor from India to Bahrain. This continuing face to face interaction is the defining feature of bilateral relationship between India and Bahrain. Regarding challenges, the main challenge is to take the trade relationship to the next level. HRH Prince Salman seems to be looking East and Bahraini authorities have a clear recognition of India as an emerging power. The challenge is to continue working together to strengthen cooperation and expand mutual benefits. Bahrain is often referred to as the Gateway to the Gulf. How can Indian companies benefit from doing business in Bahrain, in comparison to other GCC states? Bahrain offers a stable economic climate, competitive costs and the freest economy in the Middle East. Additionally, there is 100% foreign ownership allowed, lowest taxes in the region, availability of educated and skilled personnel in the kingdom, and closeness to major Gulf markets like Saudi Arabia, UAE, and Qatar. Thus, Bahrain is a very attractive atmosphere for Indian companies to do and base their businesses in Bahrain. With 350,000 Indians living in Bahrain, 25% percent of them at the managerial level, Indians have already contributed much to the country. GFI Gulf Insider August 2013
13
Special Feature Advertorial
Bahrain Financing Company General Manager Errol Fonseca talks about “UNBEATABLE” expansion, customer feedback and employee training.
B
ahrain Financing Company (BFC), one of the oldest foreign exchange companies, in the Kingdom opened 4 new branches, in Bahrain this year taking the figure to 34. There are 15 exchange houses on the island, with a total of 157 branches and growing. Despite stiff competition BFC has its “UNBEATABLE” strategies in place and aspires to be every potential customer’s first choice. Errol Fonseca believes that customer feedback is paramount when determining customer needs and tastes, particularly in the service industry. “We have mechanisms to
garner customer feedback,” he says. “BFC has Facebook and Twitter pages where we encourage customers to share feedback on our products and services. We are also working with third party vendors to create new and improved service standards which helps us understand why customers come to us or go to competitors.” He adds that resolving customer queries within a specific timeframe ensures higher levels of customer satisfaction and repeat business. BFC invests a lot on employee training every year. Says Errol, “We have a fantastic in-house training centre; one of the best in Bahrain.” He cites an
instance: Employees of various nationalities are trained and groomed to speak to customers proactively and ensure our services are “UNBEATABLE”. This is done on a regular basis across BFC outlets. A team player, Errol believes that ‘Team Work’ makes a dream work. A passionate leader he is committed to make things happen and not leave it to chance or destiny. He thinks that a great leader always leads from the front, sets the perfect example and takes responsibility. GFI
For further inquiries call on, Tel. +973 1722 8888 or visit www.bfc.com.bh
WIN with BFC!
The Big Cash Bonanza: On doing a remittance/fx transaction until 30th September, customers with a loyalty card can win cash prizes of 3 * $10,000, 15*$1000 and 30 *$500! BFC has 15,000 fans on Facebook
Wishing all Indians a Happy Independence Day! BFC wishes all Indian customers a very happy Independence Day. BFC has over 20,000 cash pick locations including 21 BFC Forex branches. In addition, BFC has a beneficiary call back service and a toll-free customer services centre, allowing us to provide you with safe and reliable money transfer services, as well as great rates and customer service. BFC always strives to make your life easier, so thank you for your continued custom and support. Call 17228888 or visit bfc.com.bh for more info. Toll-free customer service in India 1800 103 3006.
/BFCBahrain /BFCBahrain Care. Trust. Efficiency.
14
Gulf Insider August 2013
BFC_193_independance_india_AD_170mmX109mm.indd 1
7/15/13 3:17 PM
Advertorial Special Feature
Canara Bank
C
anara Bank, a premier bank of India, has 107 glorious years of existence. With over 3,700 branches across India, it is a listed Public Sector Bank with majority shareholding of 67% by the Government of India. Recognised as Systematically Important Financial Institution in India, it caters to more than 42 million customers. Canara bank has the distinction of earning profits and paying dividends every year since inception. The bank has a total business of over USD 110, as at March 2013 and strong fundamentals with a Capital Adequacy Ratio of 12.40 per cent. Canara Bank has branches in London, Leicester (UK), Hongkong, Shanghai, Bahrain and a Representative Office in Sharjah (UAE). It also has joint venture, Commercial Bank of India LLC, at
Moscow on a 40:60 basis, with State Bank of India. It is already licensed to open a branch in Johannesburg which it plans to do shortly. Canara Bank has remittance arrangement with various exchange houses in the Middle East to cater to Canara Bank’s Founder’s Principle “A good bank is not only the financial heart of the community, but also one with an obligation of helping in every possible manner to improve the economic conditions of the common people.” the needs of expats in this region. With strong presence in Southern Parts of India, Canara Bank is well placed to extend banking services to the kin and
Canara Bank, Bahrain, a wholesale banking branch, is in business for more than a year. kith of expats living in this region. Canara Bank, Bahrain, a wholesale banking branch, is in business for more than a year and undertaking products like Trade Finance, Forex Operations, Investments, Syndications, Deposits, etc. The Bank intends to expand its presence overseas, very fast. It has the approval from the Reserve Bank of India for expansion in other International Centres namely Qatar, Frankfurt, New York, Sao Paulo, Dar-e-Salam, Tokyo, Abuja (Nizeria), Jeddah and Dubai International Financial Centre. GFI
For further information and services, please call +973 17210905 / 17003138.
Gulf Insider August 2013
15
Feature Asset Managent
Why Are There So Many Crooks in Asset Management? By Vedran Vuk
I
t’s hard to ignore that there is a steady stream of crooks in the financial news. It seems that almost every few months some new, smalltime Bernie Madoff is busted for one thing or another. What gives? Often the blame falls on “greedy businessmen,” but there are intrinsic problems in the asset-management industry that helps crooks thrive: 1. You can make a fortune by simply being lucky. Asset management is one of the only industries where you can become a multimillionaire simply through luck. This is a statistically provable fact. If you track the investment performance
16
Gulf Insider August 2013
Asset management is one of the only industries where you can become a multimillionaire simply through luck. of 10,000 people who know nothing about stocks and trading, some of them will become millionaires by sheer dumb luck. Worse, those lucky winners will typically convince themselves that they have some sort of special insight. Hence, they will sound genuine when selling their investment ideas. There’s no other profession like this. For example, one can’t be a lucky brain
surgeon. If one is a complete quack who learned nothing in medical school, one will inevitably kill somebody and get booted from the profession. You can’t just get lucky from surgery to surgery. As a result, in other professions, the bad apples are weeded out fairly quickly. However, in the financial sector, it’s quite possible for someone to be a multimillionaire and a complete imbecile when it comes to finance.
Asset Managent Feature
Rising markets help protect fraud from being revealed. Since nearly everyone is making money, the industry competition fails to eliminate the incompetent and the fraudulent. by doing just good enough? In a rising market, one can almost pick any random stock and do pretty well - maybe a few points more than the market or maybe a few points below the market. One could know very little about the stock market and make some random picks, and do all right at the least. Rising markets help protect fraud from being revealed. Since nearly everyone is making money, the industry competition fails to eliminate the incompetent and the fraudulent. Notice that most crooks are exposed when the markets turn sour. That condition is part of the reason - it’s much easier to run a scam in favorable markets. If you’re a very likable con man and promoter, you can attract a lot of people to your fund while letting the market do most of the work for you. Statistically speaking, it’s difficult to get lucky nonstop. But how about having a few really good years followed by a bunch of average ones? On Wall Street, one can make a whole career of doing precisely that.
From the pool of lucky winners, you have the perfect combination to breed deception: access to lots of money; a track record of success; and an inability to actually earn returns through skill. Managers who earned their money don’t need to cheat their clients. But unfortunately, lady luck opens the industry’s door to the incompetent, who may become crooks when the luck runs out. 2. Rising waters lift all ships. Sure, you can make a fortune in the stock market simply by luck. But why make a fortune when you can also do well
3. As long as there’s money flowing, most investors are completely blind. A friend of mine recently got into a horrible business deal that went wrong. To make a long story short, there is fraud, courts, lawyers, and missing money involved. How did he get into this bad deal? Essentially, the same guy made him nearly a million dollars in a previous deal, which was an almost 300% return. At the time, I had pointed out to my friend improprieties in the relationship. Instead of making a million, he should have made $1.3 million were it not for some dumb and questionable mistakes by his partner. Of course, my friend would not listen to me. His partner had just made him a million dollars - that’s all he needed to know. So even though I plainly showed him his partner’s incompetence and reliance on luck, he went ahead on a
second deal with him. In hindsight, his partner was doing fine in a rapidly rising market that helped disguise his fraud and cluelessness. When the market crashed on the next deal, everything came out of the woodwork. 4. People forget every lesson taught in business school. If someone is making money or has previously earned money in the past, it’s easier to ignore everything learned in business school finance courses. Similar to item number three, we are willing to believe anything from a wealthy person. “So you doodle lines on a chart of the S&P 500, and you can predict the way the market is heading. Sounds kind of fishy... but since you have so much money, I guess it must work.” This sort of thing happens all the time. These four elements help fraud go a lot further than in most professions. And it’s hard for us to resist some of these scams. How many people will look into the details and fire an asset manager who just earned them 75% returns, when maybe the return should have been 80%? Who can stand up to a superwealthy fund manager and accuse him of being a charlatan based on financial theory? This is exactly happened with the Bernie Madoff scandal, as his consistent returns were practically impossible. The case was laid out in front of the SEC. Nobody listened - after all, Bernie was a super-successful investor. My advice for avoiding many problems is simple: don’t focus on someone’s net worth for your investment decisions. Instead, consider their ideas and pretend that you heard them from the intern just starting his first day on the job. Does the idea still sound like a logical and reasonable investment plan? If so, then you should go for it; but if you’re following advice on blind faith, you’re potentially setting yourself up for disaster. GFI Gulf Insider August 2013
17
Bahrain Government
‘Smarter Government’
WITH BENEFITS FOR ALL
By Nicholas Cortes
There is a widespread belief by people in Bahrain that the Government owes them a living!
M
any in Bahrain believes that the Government will create everything, including opportunities, fix everything and train everyone. Moreover, getting a government job is like a cow finding a field of fodder where the clover is always four-leafed and lush. When it rains and it floods, blame the Government, when a house burns down, demand Government compensation and help in building a new one, don’t pay water and electricity charges because eventually the Government will declare an amnesty and you have “wasted” all
18
Gulf Insider August 2013
that money, burn tyres on the roads and pull down the light poles because you feel a grievance, and the Government will eventually repair things. And so on, forever and ever after, like a Sugar Daddy! It is all a matter of ‘entitlement’ for irrespective of wealth or status, everyone gets the same fuel and food subsidies, whether they drive a Moped or a Mercedes. Since independence in 1972, the price of fuel has remained at 100 fils a litre making Bahrain’s fuel one of the cheapest fuel sources in the world. Arriving expats are always amazed
that petrol is cheaper than water and that some people actually try to smuggle diesel fuel into Saudi Arabia to make a buck, because it is so heavily subsidized in Bahrain! Then there is the subsidized water, and food … Yet every effort by Government Ministers, who correctly see the increasing Budget subsidies as being economically unsustainable if they are also to provide the other Government services that Bahrainis expect (Free healthcare, social welfare, education, housing for the ‘poor’), are constantly assailed by a vocal Parliament which
Government Bahrain
sees the subsidies as sacrosanct. Untouchable! Mind you, that same Parliament is happy to ensure that the expatriates who constitute 77% of the ‘national workforce’ also pay ‘compulsory levees’ to fund employment training schemes for out of work Bahrainis. And nor do nonBahrainis in the civil service participate in almost annual pay increases. But don’t dare mention any miniscule form of Value Added Tax, even if only a laughable 2 or 3%, to help diversify revenue raising from an economy that is still largely reliant on oil and oil derivatives, and there is a barrage of trenchant criticism. Wash your mouth out with soap, even if it is only suggested as an exercise to get people thinking about the certainty of revenue that a tax base provides so that budgets are not over-dependent on the vagaries of oil prices. When one looks at societies in developing countries, there is often an inappropriate weight given to securing government employment, especially in instances where it is seen as a sinecure for ‘life-time employment,’ a now rather dated and set-aside concept. It originally related to having a bureaucracy which could only proffer ‘fearless advice’ if that advice could withstand the dismissal of individuals on those occasions when their advice might not be deemed as favourable! Now, so many formerly ‘neutral’ bureaucracies are highly politicized at their top and advisory levels that the concept of neutrality is faintly risible. At the same time, bureaucrats at all levels are involved in individual performance contracts and annual appraisals, which also allow for dismissal and redundancies for unsatisfactory performance. Bureaucracies have become leaner, more efficient and simply forced to ‘work smarter,’ through budget constraints forced on Ministries by governments which are ‘electorally adverse’ to raising taxation levels on a voting public. So the lure of Government working conditions and a job no longer for life, has lost some of its lustre. Public employment
has become infinitely more like private employment, faster, snappier and driven by the ‘dollar bottom line,’ within the constraints of the need of government to provide adequate public services. This has not yet happened as quickly in Bahrain where ‘government service’ still carries the attraction of permanence, ‘comfort,’ and inevitable positional and salary hikes. Many university graduates therefore, look first to government employ and the private sector second. Labour Minister Jameel Humaidan recently revealed that the average public sector salary was BD677 per month as opposed to the average private sector salary being BD508. Graduates fresh from university in public employ should, according to the Minister, “not receive less than BD400.” Add to that generous
With the mounting cost of bureaucracy (The UK for example, spends GBP 689 billion annually on public services), governments around the world are looking to be innovative and changing the whole ethos of ‘public service.’ There is an increasing focus on “out-sourcing” and privatizing services traditionally associated with government, something the Bahraini authorities cannot fail to be aware of, given that they recently hosted a major regional conference on public administration. The ideas are ‘out there,’ but what is needed is the courage to take some policy decisions if Bahrain wants to be at the cutting edge of administrative excellence. Merely blathering about the need to cut “red tape” as though that is a panacea for all ills, and which sadly, is more the subject of talk, is no longer enough. What is needed is above all action and a professional ethos of really wanting to serve the community in an efficient and engaging manner. Increasingly bureaucracies are being told to “do more” with the same budget allocation they received “last year,” an anathema to services brought up with a ‘same as last year plus 10%’ budget allocation mentality. Ministries and public utilities have been forced to become more efficient and innovative by cutting, restructuring or consolidating, kind words for simply having to “work smarter” with less. Governments, particularly in austere times, welcome the opportunity to sell off non-performing state assets, or break them up into sellable lots. It also allows for restructuring and the prospect of ending “employment feather-bedding” as well as overhauling work practices or allowing for the purchase of more modern and efficient plant and equipment. And it is all done with a view to amortizing debt, and eventually creating savings. Much can be gained from lopping off the dead hand of command from the centre (and the civil service in Bahrain is VERY centrally commanded!), so that organizations like the Civil Service Bureau become confined purely to the service-
Parliament is happy to ensure that the expatriates who constitute 77% of the ‘national workforce’ also pay ‘compulsory levees’ to fund employment training schemes for out of work Bahrainis. working hours, pensions and conditions, and the Parliament recently wanting to scupper the budget unless all Bahraini civil servants got an across the board 15% salary increase, and it is easy to understand why most young people want to become bureaucrats. And while civil service professionalism remains an objective, particularly through the pursuit of excellence and international bench-marking goals, much of the service has a reputation for not being very customer conscious or efficient and civil servants who are generally a bunch of inveterate clock watchers and break-takers. Stories of run-ins with inept bureaucrats are a legion, but fortunately it is changing as civil servants find first efficiency, and then set their eyes on actual excellence and ‘world’s best practice.’
Gulf Insider August 2013
19
Bahrain Government
Tamkeen and the LMRA are examples where important government functions are already successfully run by autonomous agencies. wide maintenance of overall employment standards. Services like the Post Office, lend themselves to privatization where given the opportunity, they compete efficiently and well, for example, with courier services. Building maintenance, food catering services, office machines and equipment servicing, finance and human resources, fleet sourcing, vehicle maintenance, and many other services, can be just as easily ‘out-sourced’ often providing cost savings and private sector employment, which is generally more efficient and cost conscious. Often, when non-core functions are hived off, the people who were previously doing those functions are snapped up by their new, now private employer, given more responsibility and freedom to make management decisions in a more costeffective manner. Tamkeen and the LMRA are examples where important government functions are already successfully run by autonomous agencies while telecommunications and banking, which are vital to community needs, generally work well at selfregulation under the watchful eye of an industry regulator. Individual Ministries would for example, still have small Human Resources offices and Training functions but routine HR activities, leave, pay, allowances and pension provisions, would be handled electronically by HR Central which would also monitor and advise individual training requirements in a Ministries-wide consolidation. There would be greater focus on restructuring and dispensing of non-core functions, and redundancy where necessary. Ministries would also be opened up to more lateral recruitment rather than the usual civil service regime of ‘rising through the ranks.’ Both civil servants and private sector employees become more seamlessly interchangeable and experienced in the differing levels of management and policy development. All would be contracted employees with no job guaranteed for life. Work would, in the main, be performance driven – which is the way that it should be. The whole look at governance by increasing privatization has in many countries, really just begun, although in transport, for example, it really is old hat. But the prospects are limitless. Prisons, many functions in policing administration, customs regulation, traffic flow and monitoring, aspects of cultural management and events, all could be privatized. People actually become experts in their fields rather than mere amorphous civil servants. A new show to improve the flow? Way to go! GFI
The author is a former senior diplomat and political adviser with extensive international experience in strategic and parliamentary affairs, and is currently working in Bahrain 20
Gulf Insider August 2013
Egypt Feature
Revolution in Egypt:
are Cairo’s secret police on the right side for once? By Colin Freeman
S
tep forward the men from state security, whose undercover operatives have played an extraordinary behind-the-scenes role in recent events. Easily identified by their Plainclothes look of smart slacks, casual shirt and leather jacket with a distinctive bulge, they were bete noir of the Facebookers in Tahrir Square in 2011, whom they would duff up and arrest with gusto. Now, though, those same brutish men appear to have changed sides, if not clothes, protecting the anti-government crowds who demonstrated against President Morsi in recent weeks. So is it an outbreak of sudden peace and love among Egypt’s spooks? Or is the “deep state”, as it’s known in Egypt, back with a vengeance? For once, this is a conspiracy theory that appears to have some credence. The Amn al-Dawla, or State Security Investigations Service, was a hated organisation during Mubarak’s time, a sign that Egypt, despite its tourist friendly image, was a police state in much the same mould as Syria or Iraq. Its 100,000 staff monitored every walk of Egyptian life, even organisations such as hospitals and universities, and to get on the wrong side of them politically was
to have one’s card marked for life (or, in some cases, death). It was no surprise, therefore, when after Mr Mubarak’s fall in 2011, its headquarters were ransacked by crowds of angry demonstrators. Back then, anyone who even looked vaguely like a state-security man – burly, middle-aged, bad dress sense – could get surrounded by a mob and beaten up. But while state security lost its stranglehold of terror that time, and has been in something of a directionless flux ever since, no organisation with 100,000 people in it just disappears completely. And crucially, its leaders did not form a warm relationship with the Egypt’s new Muslim Brotherhood masters when they swept to power in last year’s elections. From the Brotherhood’s point of view, state security had beaten up and tortured far too many Brotherhood followers to ever be trusted to any real degree. And from state security’s point of view, far too many Brotherhood types had pasts as violent militants, who had no business being anywhere near the reins of power. Hence the sight of plain clothes men mingling in recent weeks with the crowds of anti-government protesters, this time with a view to protecting them rather than singling out people to
From the Brotherhood’s point of view, state security had beaten up and tortured far too many Brotherhood followers to ever be trusted to any real degree. cart away for questioning. So is there a genuine change of heart, or is it just a good instinct for self-preservation? One Egyptian friend of mine, Cairo surgeon Ali Abdelwahab, thinks it’s a bit of both. He has bitter memories of how the resident agent in his own university hospital used to swagger into the Dean’s office and put his feet on the desk. But he also knows a few of them personally, and reckons they have wised up a little since 2011. “They have had a bit of selfinsight since then,” he says. “Some of them now want to be a modern, functioning part of society rather than people who are hated by everyone.” GFI Gulf Insider August 2013
21
Bahrain Real Estate
BAHRAIN REAL ESTATE
SHOWS FIRST SMALL SIGNS OF RECOVERY
B
ahrain’s economic growth showed extremely positive signs in the first quarter as oil outputs were revived. Gross Domestic Product (GDP) grew by 2.5% in Q1 2013 compared to a contraction of 0.2% in Q4 2012. By the end of Q1 2013 annual GDP growth was recorded at 4.2% largely on the back of increased output in the hydrocarbons sector which rose by 8.0% over the year to end Q1 2013. Growth in the financial services sector slowed to 0.3% in Q1 2013, a significant change from Q4 2012 and the sector remains under pressure from difficult market conditions. Employment in Bahrain has also risen significantly over the last year, largely on the back of a programme of real estate/ infrastructure projects taking place throughout the Kingdom. Bahrain’s total workforce grew to around 650,000 out of a total population estimated at around 1.3 million. Out of this workforce 77% are expatriates, while the unemployment rate (for Bahrainis) hovers at around 5%. Expatriate employment permits issued 22
Gulf Insider August 2013
in Q1 2013 grew by 5.5% to 32,200 compared to 30,517 in Q1 2012, with 30% of these being in the construction sector. Other leading sectors were retail (22%) and industry (14%). As part of the surge in housing and infrastructure projects initiated by the Government during Q2 2013, the Housing Minister announced that around $8 billion will be spent on housing projects by 2017. The government has built over 100,000 housing units over the past 50 years but with rapid population growth and constraints on the amount of available serviced land, the waiting list now stands at well over 50,000 units. Various initiatives have been announced and these include the demolition of existing government apartment buildings and the construction of replacement properties at a significantly improved density and efficiency. 10 locations have already been selected for this programme under which 1,912 existing units will be replaced by 4,000 new units on the same land - mostly in taller buildings, within 5 years. The government’s housing arm, Eskan
Bank, has also appointed specialists during Q2 to identify the most efficient fundraising methodology to support the development of 2,500 government housing units on the significant land bank held by its subsidiary Eskan Properties.
Office Market
There remains little activity to report in the prime office market which is now spread across the northern part of the Kingdom, in Seef District, Diplomatic Area, and Bahrain Financial Harbour. Rental rates remain subdued with new business mainly restricted to consolidation/rationalisation activity in previously used spaces that offer fittedout accommodation. Vacancy rates vary widely as do rental rates with tenants now able to dictate terms. There is only marginal downward movement for the renewal of leases held by those who have already undertaken expensive fit-out programmes but new tenancies are being (relatively) hard fought over although most landlords appear now to have reached their bottom
Real Estate Bahrain
price and suite of incentives. Those buildings that offer good parking ratios and/or have access to undeveloped land where tenants can park, and can offer some assistance with fit-outs, are performing better than those in awkward locations with weak parking solutions. Poor parking and access have become the dominant characteristics of Diplomatic Area where approximately 50,000 square metres of new prime office space was completed during Q2 2013. Diplomatic Area has suffered the worst in recent years and performs in marked contrast to Seef District where many office properties now have dedicated parking towers. Crucially, Seef remains less developed than Diplomatic Area, circulation is therefore better and parking on undeveloped plots is more readily available. A third characteristic of the better performing properties is that of international property management which is increasingly being introduced by landlords in an effort to attract and/or retain the international tenants who are now calling the shots. This process also protects and/or enhances the value of prime office properties but a market where international management is the norm remains a long way from reality. In the investment sector, the realisation that the market has ‘bottomed out’ seems finally to have stimulated the thoughts of those investors who have been waiting for several years for a ‘bargain’. The dawning reality that rents and therefore values/prices are more likely to rise over the next few years rather than fall further, has prompted renewed enquiries for the better, prime commercial properties. Properties with existing, quality tenants on long leases, with good management and in prime locations are now being actively considered with several deals on the verge of completion after a long period of dormancy in the investment market.
some driven by belief that the future of Bahrain’s hospitality sector is exceptionally strong – partly aided by the change in Saudi Arabia’s working week, some driven by the need to turn nonperforming commercial or residential towers into cash-generating assets. Kuwait Finance House announced that it would be financing the completion of the stalled Banader Rotana Hotel project, a 28 storey, five-star hotel and furnished apartments property offering 251 rooms, while Hilton Worldwide announced its intention to open a 350 room, five-star Double Tree Suites in Juffair in late 2015. Nama International announced the phase one construction of a four-star hotel with around 175 rooms on Bahrain Bay and a further phase two development of 240 five-star rooms, although no specific timing has been declared for either
accommodation these are generally located on Reef Island and Amwaj Islands. With respect to the compound sector, the historically popular Saar/Budaiya areas continue to suffer from geographic proximity to the more troubled villages in this part of the Kingdom. The zone that is now replacing the Saar and Budaiya areas as the preferred expatriate family destination is known as ‘new Hamala’, which lies a short distance to the south. The ‘new Hamala’ area enjoys straightforward access on to the main highway leading to Manama and is also conveniently positioned for those who commute to Saudi Arabia via the causeway on a regular basis. More importantly, the stock of housing in this area is generally newer, there is an international school and retail strip in close proximity and there is no disruption from local villages. The needs of the low-income expatriate population are increasingly being addressed by purpose built accommodation in the Hidd area in particular. Instead of cramming into overcrowded and inappropriate accommodation in ageing properties in central Manama, new labour accommodation is now emerging in non-residential areas and being absorbed rapidly much to the relief of employers, employees and local Arab families who have been complaining about the presence of bachelors in their communities for some time. For Bahrainis, the preferred method of securing housing continues to be building out their own plots but appropriately zoned land in existing communities is becoming increasingly difficult to obtain at affordable prices. Land plots continue to be the subject of investment activity by the more wealthy Bahrainis seeking assets that they know will appreciate over time. Given that the way in which land values are calculated (effectively, based on their zoned use) is not widely appreciated, and the time value of money is not generally well understood, it is easy for land prices to become ‘overspeculated’ and this is generally the position that Bahrain is in now.
Rental rates remain subdued with new business mainly restricted to consolidation/ rationalisation activity in previously used spaces that offer fitted-out accommodation.
Hospitality Sector
Q2 2013 saw the announcement of a raft of new hotel projects in Bahrain,
project. Swiss-Belhotel International also announced a new four-star project offering 149 rooms would be opening in Seef District in Q1 2014. Finally, Domain Hotels announced a new concept to the Bahrain market through the creation of a 131 room hotel which combines a boutique hotel concept with a private members club incorporating nine restaurants and lounges. The Domain Bahrain is scheduled to open in Q3 2013.
Residential Market
In a tough market, the better properties continue to pick up most of the new business in the rental market and in terms of expatriate apartment rental
Gulf Insider August 2013
23
Bahrain Real Estate
Being an island nation, land is limited and relative to average annual incomes, residential land plots are now generally unaffordable to the masses. Add to this, restrictions regarding arguably unrealistic minimum land plot sizes for residential development and we have a situation which is the source of much frustration for the rapidly growing population of Bahrainis. Newly reclaimed island projects such as Diyar Al Muharraq are now also selling land plot parcels for residential use within masterplanned communities. For example, the Sarat project has now sold just under 100 plots since launch in Q1 2013, mostly to Bahrainis. However, these residential community projects have no timetable at present and no obligations are being imposed on buyers with respect to building out their plots. Plot sales have been reportedly buoyant with few multiple purchases, but we suspect that these are generally being made for investment purposes rather than selfbuild projects. Other high profile masterplanned communities such as Riffa Views and Tala Island on Amwaj Islands continue to report relatively buoyant sales activity and creeping price increases, although these sales are rarely to
24
Gulf Insider August 2013
western or Asian expatriates at present. Buyers are increasingly Bahrainis seeking owner occupation or ‘other Arabs’ comprised of Saudis, Kuwaitis, Iraqis, Jordanians and Syrians. It is not absolutely clear what the motivation of these groups is, but it is considered likely that they are purchasing such property predominantly for investment purposes. There have been the first beginnings of a general pick-up in residential development activity and sales during Q2, Durrat Marina, located just north of Durrat Al Bahrain, signed a memorandum of understanding for the sale and marketing of the first phase of development which includes a residential area, comprising villas and apartments, a ‘festival’ retail area and marina. The second phase of Wahat Al Muharraq, a 227-villa housing project was also announced in Q2 2013, the first offering of 32 units at the Seavilla project on the reclaimed Dilmunia Island was released and successfully sold, work commenced on a new 128 villa project at Durrat Al Areen, the BD20 million Oryx Hills housing project which is part of the Al Areen masterplanned community was restarted, and the foundation stone for a 4,500 unit government housing unit scheme was
laid. We anticipate that the confluence of summer and Ramadan will, as usual, create a general slowdown in development activity, but this is usually the period during which we see developers commission their feasibility and best-use studies for review on their return to the Kingdom after the break. The level of this kind of business during the next quarter will at least provide some indicators for developer appetite. GFI
Being an island nation, land is limited and relative to average annual incomes, residential land plots are now generally unaffordable to the masses.
Ramee Grand Hotel & Spa Bahrain
The new Ramee Grand Hotel & Spa
opens soft in Seef
Nick Cooksey visits Bahrain’s new five star hotel prior to its Eid opening.
I
was shown around the new and soon to open Ramee Grand Hotel & Spa last month by Ramee Group General Manager Mr. Shantaram Shetty as artisans and crew rushed to put in finishing touches ahead of the Eid opening. The Ramee Grand Hotel & Spa is the first five-star hotel by the Ramee Group, and no expense has been spared in procuring the finest materials for its interiors. Marble has been flown in from Italy, bathroom fittings from Germany, teak wood from Indonesia, and so on, totaling a list of 18 different countries that have been sourced for the best quality products. Care has also been taken to provide luxurious amenities in each of the 166 guest rooms and suites, from fine linen and Bulgari bath products, right down to parchment style writing paper and fine quality pens. The lobby is spacious, bright, and welcoming, and the entire property has been built around a unique Tree of Life theme not seen before in Bahrain. The carpets and walls all carry motifs of trees, which have been used as decorative elements throughout. In keeping with the green theme, there has even been an effort to incorporate environmentallyfriendly practices into the running of the hotel.
The lobby is spacious, bright, and welcoming, and the entire property has been built around a unique Tree of Life theme not seen before in Bahrain. Mr. Nicolas Gardier, Director of Food and Beverages, reveals information about the hotel’s eight outlets, three of which will open for Eid, with the rest to follow shortly. These include an Italian restaurant, an Indian restaurant, and an All-day-dining restaurant which offers International cuisine. In addition to these there is a stylish tea lounge, a sports bar, and a pool bar. He is particularly enthused about a Japanese restaurant and lounge which sits on the rooftop, offering 360 degree views of Bahrain, and would make for a very romantic date night. He also tells us about their nightclub, which is scheduled to open two weeks after Eid, which will cater to
international tastes and be the largest in Bahrain. Another star attraction is the 2000 square metre spa, again, the largest of its kind, with 13 treatment rooms, ladies’ and gents’ salons, and large pool and gym areas. An oasis of calm in the middle of the Seef business district, it will prove a quick and relaxing getaway. The hotel is manned by a team of 350 cheerful and friendly staff. Mr. Shetty himself is the embodiment of warm hospitality, exuding a certain old world charm, and being the kind of consummate professional who offers to walk his guests to their car (which is valet-parked, of course) after the tour. He takes obvious pride in his work as he tells us about the company’s history. The Ramee Group began from humble origins, starting with just a restaurant in Dubai. The next Ramee Grand Hotel & Spa will start its construction in Dubai business bay very soon followed by one in Abu Dhabi, Reem Island. It rose through the ranks, opening two-, three-, and four-star hotels across the GCC and India. This hotel is Ramee Group’s biggest project to date and is the culmination of those efforts, marking the company’s strategic decision to now focus on five-star properties. GFI
Gulf Insider August 2013
25
Feature NSA
On Leaks and Pseudo-Reality:
The US’ Futile Search for ‘World Domination’ By Ramzy Baroud
T
hose enchanted by pseudo-reality must have been at the edge of their seats as they watched ‘Zero Dark Thirty’, a Hollywood account of how US SEAL Team Six killed Osama Bin Laden on May 1, 2011. But a recently leaked report shows that the ‘riveting’ Hollywood account of the ‘greatest manhunt of all time’ was hardly as glamorous as it was made to be. In fact, if it were not for the ‘shocking state of affairs’ in Pakistan itself, where local governance had ‘completely collapsed’, the raid would have been yet another botched attempt at killing a man that had been using primitive means – for example a ‘cowboy hat’ to evade drones – as he had managed to survive for nearly nine years. The 337-page report was the outcome of a thorough, but secret investigation by a commission set up by the Pakistan government following the US raid. Reporting for Al Jazeera, Asad Hashim summed up the commission’s findings: “Osama bin Laden, al-Qaeda’s chief, was able to evade detection in Pakistan for nine years due to the ‘collective failure’ of the Pakistani state’s military and intelligence authorities, and ‘routine’ incompetence at every level of the civil governance structure.” The timing of the leaked report was pretty interesting as well. It appeared shortly after Edward Snowden, a US National Security Agency (NSA) contractor, leaked damning information of the very shady and illegal behavior by the US government pertaining to its global surveillance program. Hundreds of
26
Gulf Insider August 2013
millions of people in the US and around the world have fallen victim to the NSA spying program, whether through their telephone records, or through the PRISM program that grants the spying agency direct access to stored internet activity of nearly anyone, anywhere. It is “a global, ubiquitous surveillance system that has as its goal the elimination of privacy worldwide”, wrote Glenn Greenwald of the Guardian. Even EU offices were bugged by the US, according to the leaked information. If America’s closest allies were bugged, then no one is safe. The Brazilian newspaper O Globo revealed in reports, based on information provided by Snowden that the US had tapped into telecoms infrastructure in Brazil to acquire massive volumes of communications and to spy on governments throughout the region. While Al Jazeera’s leak translated into media debates regarding Pakistan’s own failures and its odd alliance with the US, Snowden’s leaks are generating a global debate regarding the US’s persistent attempts at global meddling and domination despite its repeated setbacks in Iraq and Afghanistan, and its diminishing, once unchallenged role as a superpower. While corporate US media continue to toe the line by doing everything in their power to focus on the least relevant parts of the Snowden story, US government apologists are trying to soften the blow. Jim Lewis, a former intelligence official - now at the Center for Strategic and International Studies in
Washington – had this to stay, according to the Financial Times: “Great powers all engage in espionage. That includes China, Russia and the US. It’s not war, it’s not an attack, it’s not use of force, it’s not even coercion.” Although there is an element of truth in Lewis’ remarks, there is no denial that the extent of that spying can also tell us a great deal about the nature of the spy and the use of the information. When the victims are hundreds of millions of people from every country in the world, then one cannot help but object to the illegality and magnitude of the act. One knows that it’s not your everyday spying practice when Cristina Fernández, president of Argentina says, “It sends chills up my spine when we learn they are spying on all of us through their intelligence services in Brazil.” Not even the most paranoid amongst us would have imagined the extent of the US government’s violation of the very privacy laws that itself helped draft, promote and swore to protect. The Snowden leak revealed aspects of the NSA’s unwarranted practices, but what else is still being concealed? And what is the ultimate goal of the US government when it spies potentially on every citizen and every government? GFI
Ramzy Baroud (www.ramzybaroud.net) is an internationally-syndicated columnist and the editor of PalestineChronicle. com. His latest book is: My Father was A Freedom Fighter: Gaza’s Untold Story (Pluto Press).
Asian War Feature
What Will Really Trigger the Next Asian War?
By Marin Katusa
N
orth Korea has recently been rattling its sabers once again, even producing some videos that threaten attacks on US forces using “powerful weapons of mass destruction” and show an invasion of Seoul where thousands of American citizens are taken hostage. American senators are already up in arms about how a “major war” is brewing on the Korean peninsula. But as usual, American lawmakers are completely missing the point. The real war will not be launched by the hungry, demoralized troops of North Korea, but rather the warships of China, Taiwan, the Philippines, Vietnam, Malaysia, Brunei, and Indonesia. And unlike a North Korean invasion that could likely be thwarted in days, a war in the South China Sea would
have far bigger implications. Let us explain. The South China Sea contains approximately 150 uninhabited islands off the southern coast of China. It is important for two main reasons: 1. It is the second most-used sea lane in the world, as it is the shortest sea route between the Middle East and Asia. If there were conflicts in the South China Sea, it would cause half of the world’s fleet to detour around Indonesia. 2. There are billions of barrels of oil and trillions of cubic feet of natural gas that could be trapped beneath the ocean floor. Its importance also means that the countries in the area are all vying for a piece of the action, sometimes even leading to armed confrontations: In
May of 2011, Chinese patrol boats harassed a Vietnamese oil exploration ship, disrupting a seismic exploration program being done by PetroVietnam. In a time where big oil and gas deposits are becoming harder to come by, the oil and gas wealth of the South China Sea becomes even more attractive. Unlike North Korea, China is absolutely unafraid to project its economic and military might upon its neighbors. But the Southeast Asians are no pushovers either - they will take every advantage they can to push China out of their waters. So isn’t it a matter of time before someone takes this game of chicken too far and leads into a full-scale war? Let us all hope that cool heads will prevail. GFI
Gulf Insider August 2013
27
Feature Business
‘Game Changing’ Ways
to Transform Business and Society The Boston Consulting Group Identifies Five Key Issues for Transforming the Fortunes of Business and Society in an Age of Accelerating Change, Growing Complexity, and Heightened Competition.
T
he Boston Consulting Group (BCG), one of the world’s leading management consulting firms, announced it will launch a yearlong program focused on the theme of “Game Changing” to help mark the company’s fiftieth anniversary in 2013. The Game Changing program will tackle the most fundamental dynamics facing leaders in an age of unprecedented turbulence, and it will develop and promote action-oriented breakthrough ideas for transforming the fortunes of business and society. “The global economy is undergoing the most radical transformation since the Industrial Revolution,” said Rich Lesser, who became BCG’s president and chief executive officer on January 1. “The rapid rise of the emerging markets, extraordinary technological advances, hyperconnectivity, dramatic demographic change, fiscally constrained public sectors all of these are forcing companies to rethink and revamp the way they do business. To capitalize on the opportunities created by accelerating change, leaders need to be proactive and challenge the status quo. In short, they need to change the game.” As part of the Game Changing program, BCG has identified five key issues or “dimensions” for successfully managing in an age of accelerating change:
¡ The New Growth-Value Equation. Growth wasn’t effortless before the financial crisis, but few executives would disagree that it’s become much more difficult since then, particularly in developed markets. Now leaders need to refocus on the core strategies for creating profitable growth in order to create long-term value: entering new markets or expanding into existing ones and investing in innovative products and services, processes, and business models. ¡ The Fit-to-Compete Factor. In an increasingly complex and competitive world, companies and countries need to be not just fit for purpose but fit to compete. They must develop “smart rules” for managing complexity and gaining competitive advantage - becoming leaner and more operationally efficient, simpler and more organizationally effective, and better able to attract the best talent. ¡ The Adaptive Mindset. Companies must continuously reshape their organizations in order to not only respond to rapid change but also leap ahead of competitors. Likewise, public sectors have to develop agile ways of reforming their institutions in order to enhance essential services, such as health and education, and meet the changing needs of their people. ¡ The Two Halves of Connectivity. To
28
Gulf Insider August 2013
succeed, companies and countries need to harness the tools of hyperconnectivity: not just digital technology but also bridges, roads, railroads, and airports particularly in the fast-developing economies (“the forgotten half of connectivity”). By doing so, they can realize the true potential of ever more connected consumers, markets, and society.
¡ The Perpetuity Principle. Leaders must display the skills of stewardship, developing sustainable and trusted businesses with a vision of their companies’ long-term legacy - to meet the growing expectations of society, ensure value creation, and improve wellbeing for the future. To explore the Game Changing theme and each of the five dimensions, BCG will release a steady stream of new research and commentary throughout 2013. The first publications of the series - The Most Innovative Companies 2012, Ending the Era of Ponzi Finance, and Allies and Adversaries: 2013 BCG Global Challengers have just been released. So, too, has a new eBook, Shaping the Future in a Time of Accelerating Change, which highlights some of the key issues facing business and society today. GFI
For information on the Game Changing program, go to bcgperspectives.com, follow @BCGPerspectives on Twitter, or like BCG Perspectives on Facebook.
Property Dubai
Cityscape Global prepares to host more than 200 exhibitors in Dubai
A
ccording to the Dubai Land Department, more than AED50 billion was invested into Dubai real estate in 2012, while Cityscape Global is expected to grow by 50 per cent for the second year running and host more than 200 exhibitors in 2013 for the first time in four years. Several Dubai-based developers will be exhibiting for the first time, and many more major developers will be returning to the show after a hiatus following the global recession in 2008. MAG Group, Omniyat, Tanmiyat, Jumeirah Golf Estates and Union Properties return for the first time in several years with new developments and project updates, while Diamond Developers, SKAI, and Sobha Group take their place among a group of newcomers to the showpiece event,
which takes place from 8-10 October at the Dubai World Trade Centre. The event’s organisers, Informa Exhibitions, also expect several new project launches from local companies including Emaar, Nakheel, Dubai Properties Group, Meraas, Dubai World Central, and Meydan, as the key developers look to drum up demand from investors. For the first time since 2008, all sectors of the Dubai real estate market are now be on the upswing. According to global real estate service firm, Jones Lang LaSalle, 2,200 units were added to Dubai’s residential stock inventory in first quarter of 2013, bringing the total inventory in the emirate to 357,000 units, with a further 42,000 estimated to be delivered in the next two years. Turkey represents the largest out of eight international pavilions, as more than 20 developers including Agaoglu, Eroglu, Vadistanbul, and NEF showcase their latest mega-projects in the country’s property market. A large representation from Qatar will be also take part as the thriving Gulf state
For the first time since 2008, all sectors of the Dubai real estate market are now be on the upswing. continues on its ambitious development plan as the host of the 2022 FIFA World Cup – Msheireb Properties, Mall of Qatar, Barwa and United Development Company (UDC), the company behind the Pearl Qatar, are among the headline developers on show. The property event is co-located with three dedicated conference programmes – the Global Real Estate Summit, Future Cities, and the MENA Mortgage and Affordable Housing Congress, bringing together a combined 750 senior real estate professionals who will explore opportunities and find solutions to key challenges affecting the industry today. GFI
Gulf Insider August 2013
29
Feature e-commerce
33% of MENA Consumers Make Online Purchases
T
he internet is fast changing the purchasing behaviours of consumers in Bahrain and the rest of the region. Familiarity with technology, widely available highspeed internet services and growing trust in online services has led to a boom in online shopping. Figures show that roughly 33% of MENA consumers now make online purchases and industry analysts expect e-commerce in the region to reach an estimated $15 billion in 2015. Even retail chains with established physical stores are looking to engage their customers through online channels giving them the ability to browse, select and purchase products of their choice from the convenience of their homes. Shaheen Haque, Territory Manager, Middle East & Turkey at Interactive Intelligence says that to achieve the difficult task of building customer loyalty when the primary means of interaction is no longer a physical location, Bahraini companies must look at new ways to engage with customers. While the initial transaction may happen through a web portal, a consumer should be able to quickly resolve any issues by contacting the call centre and receive a high level of service. The customer experience process can range from ordering a product on the website to calling for a refund. The types of channels that e-commerce organizations, or for that matter all companies offer their
30
Gulf Insider August 2013
customers have been changing over the past decade. While phone interactions remain the dominant method of issue resolution, industry research indicates that the adoption of email, chat, and web interactions are now available in some form in over 90% of contact centres. However, the level of service being offered on these other channels varies widely. By applying some, if not all, of the suggestions listed below, companies can optimise the customer service experience.
Have a “data filter” for all channels - Social media is one of
the key marketing tools employed by online retailers. At the same time, if it is not implemented as a two-way communication platform it can adversely affect brand image. This requirement is forcing companies to provide social customer service in the call centre. The problem with this is that, in order to have a multi-channel engagement, companies need to have a “data filter” strategy. Social media noise needs to be filtered by a distinct set of criteria from influencers to sentiment, and from trends to categorization of conversations. The increase of social conversations needs to be supplemented with workflow and business process so that conversations are managed with different channel options. However, not all Twitter or Facebook conversations
need to end up in the call centre doing so could significantly increase the cost of operation. Therefore, the “data filter” needs to happen not just with social media but also with all the other channels.
Improve website traffic and page views - Callback, co-browsing,
chat, and email are key factors to increasing the number of page views on the company website and conversion rates. Companies must be mindful that the functionality needs to be interwoven with any site analytics and/or marketing automation tools being used, especially with its social media efforts.
Use mobile applications - The personal computer is no longer the king to access the Internet. Tablets and smartphones are taking over, meaning the multichannel strategy must include the integration of mobile applications. There are two types of mobile applications to consider: 1) applications that can lower the cost of customer service, such as being able to “Face Time” with the consumer to help troubleshoot the problem, and 2) applications that provide content and transactions so the consumer doesn’t need to call the call centre. One added value to both scenarios is to provide a way for the consumer to chat, call, or email directly from the application. GFI
Property London
Prime London housing: World city, global market
L
ondon is Europe’s fastest growing and most cosmopolitan city and one of the world’s most attractive locations in which to invest, learn, live and do business. Its prime residential real estate is a global asset class where international buyers account for 38 per cent of resale transactions in prime locations, back to levels first seen in 1990, according to latest data from international real estate adviser, Savills. In the much smaller new build market, international buyers dominate in prime locations, accounting for almost threequarters of sales. A majority of these are investment buyers, many UK-based, and providing much-needed rental stock – an estimated total of 3,000 units in the past year – and vital development funding. Only a small proportion are buying second homes, most in the ultra prime sector of the market. There have been calls to restrict international investor activity, with claims that Londoners are being priced out of the market or that swathes of the capital are becoming ‘lights out London’. But, says Savills in World in London, not only are international buyers a reflection of a city where 35 per of residents were born overseas, they are also helping to underwrite much of London’s new development and delivering vital new rental stock. Savills estimates that within London’s prime locations 93 per cent of all buyers have an occupation or business interests in the UK, and two-thirds of international buyers of resale properties live and work
in London and consider the city home. International buyers account for 74 per cent of new build sales in prime locations, but at least half of these sales are transacted to UK-based international buyers. Whether UK or overseas based, international buyers are providing the development funding necessary to get schemes off the ground. Additionally, Savills estimates that some 3,000 affordable homes were brought forward (through Section 106 agreements) last year in schemes at least part-funded by international sales activity, often through advance marketing both in the UK and overseas. Savills report says “Every buyer in prime London is effectively operating as a global investor even if they are UK nationals,” says Barnes. “Domestic buyers, whether acquiring a home or a buy to let investment property, are buying into the same global phenomenon that is London. Their wealth has been created in a global city-state and the price they can pay in order to compete in this limited geography reflects that.
“Buyers of all nationalities – including domestic - see London as a safe haven for their money and this has been particularly true since the credit crunch when bricks and mortar have outperformed many other investment classes in terms of both capital growth and income returns.” Savills estimates that international buyers have spent a total of £37 billion in London’s prime housing markets since 2006. A sizeable proportion of will have been earned in London, with bonuses from London’s financial sector accounting for £15 billion of spending. The firm forecasts that international buyers will continue to invest at a rate of £6 billion a year and bonus money at £1.5 billion a year for the next five years. “The reality is that there will continue to be global wealth – whether internationally or domestically earned - looking for investment opportunities in a stable, transparent market and so London’s prime housing market will continue to be closely linked to global business activity in London.” GFI
Prime London locations - resale and new build market UK/international buyer split
Resale market
No. of Share of transactions all prime UK buyers
15,400
International 9,700 buyers Totals
New build
Total Market share
No. of transactions
Share of all prime
48%
1,800
6%
54%
30%
5,150
16%
46%
25,100 78% 6,950 22%
100%
Source: Savills Research 2012/13 Gulf Insider August 2013
31
Feature Business Success
the 80/20 PrinciplE By Richard Koch
A
ny large business is stuffed with unprofitable products, processes, suppliers, customers and managers. These “passengers” obstruct profit. Progress requires simplicity; and simplicity requires ruthlessness. This helps to explain why simple is as rare as it is beautiful. Those who analyze the reasons for their success know that eighty percent of their growth, profitability and satisfaction come from 20 percent of the clients. At a minimum, firms should identify the top 20 percent to get a clear picture of desirable prospects for future growth. Direct your attention where the real threat of competition exists. Focusing on 20 per cent of your customers is a great deal easier than focusing on 100 per cent of them. Being customer centred on all of your customers is pretty high impossible. But cherishing the core 20 per cent is both feasible and highly rewarding. You need to provide quite exceptional or even outrageous service to you best customers. Not regular service, not good service - outrageous service. The real key is to provide surprising service out of line with prevailing industry standards. This may have a short-ten cost but it will have a long-term reward. In seeking to gain market share, try above all to sell more to your existing core customers. Aim to keep your core customers for ever. Your core customers are money in the bank. If any of them drops out, profitability will suffer. It follows that quite extraordinary efforts to keep your core customers, that look as though they are depressing profitability, are bound to enhance it substantially over any meaningful time period. Exceptional service may even help short-term profits, by encouraging core customers to buy more. 32
Gulf Insider August 2013
But profitability is only a scorecard providing an after the fact measure of a business’s health. The real measure of a healthy business lies in the strength, depth and length of its relationship with its core customers. Customer loyalty is the basic fact that drives profitability in any case. If you start to lose core customers, the business is crumbling beneath your feet, whatever you do to dress up short-term earnings. Conversely, if the core customers are happy, the long-term expansion of the business is assured. Serving the core 20 per cent of customers must be a company-wide obsession The 80/20 Principle applies to time as well as to people: 80 per cent of sales by each of your salespeople were probably generated in 20 per cent of their worktime. Get everyone to adopt the methods that have the highest ratio of output to input. Lower costs and use the telephone for less important accounts. Get the sales force to revisit old customers who have provided good business in the past. This can mean knocking on old doors or calling old phone numbers. Some customers are vital. Most are not. Some sales efforts are wonder fully productive. Most are inefficient. Some will lose you money. Any successful enterprise draws its success from this simple, and simplifying, principle. Remember the main tenets of the 80/20 Principle:
The doctrine of the vital few and the trivial many: there are only a few things that ever produce important results. Most efforts do not realize their intended results. It
is usually too complicated and too wearisome to work out what is happening and it is also unnecessary: all
you need to know is whether something is working or not and change the mix until it is.
Most activity is a waste of time. It will not contribute materially to desired results. Not many decisions are very important. Do not agonize over the unimportant decisions and above all don’t conduct expensive and time-consuming analysis. If possible, delegate them all. The only way to stand a reasonable chance of noticing critical turning points is to stand above all your data and analysis for one day a month and ask questions like:
What uncharted problems and opportunities, that could potentially have tremendous consequences, are mounting up without my noticing? What is working well when it shouldn’t, or at least was not intended to? What are we unintentionally providing to customers that for some reason they seem to appreciate greatly? Is there something going badly astray, where we think we know why but where we might be totally wrong? Since something important is always happening underneath the surface, without anyone noticing it, what could it be this time? When a business keeps performing below its budgets, you may be sure you have a dog. When a business consistently outperforms expectations, there is at least a good chance that it can be multiplied by ten or a hundred times. In these circumstances, most people settle for modest growth. Those who seize the day become seriously rich. GFI
Skill Development Feature
The Art of Flow It’s been proven that we can produce intense feelings of enjoyment while achieving outstanding personal performance and skill development.
F
low is completely focused motivation. It is a single-minded immersion and represents perhaps the ultimate in harnessing the emotions in the service of performing and learning. In flow the emotions are not just contained and channeled, but positive, energized, and aligned with the task at hand. To be caught in a state of depression or anxiety is to be barred from flow. The hallmark of flow is a feeling of spontaneous joy, even rapture, while performing a task. There are ten factors accompanying an experience of flow. Not all are needed for flow to be experienced.
Clear goals. Concentrating
on a limited field of attention, and being able to focus and delve deeply into it.
A loss of the feeling of selfconsciousness, (the merging of action and awareness). Distorted sense of time, one’s subjective experience of time is altered. Direct and immediate feedback (successes and failures in the course of the activity are apparent, so that behavior can be adjusted as needed). Balance between ability level and challenge (the activity is neither too easy nor too difficult). A sense of personal control over the situation or activity.
The activity is rewarding, so there is an effortlessness of action. A lack of awareness of bodily needs (to the extent that one can reach a point of great hunger or fatigue without realizing it) Becoming absorbed in the activity; focus of awareness is narrowed down to the activity itself.
In flow the emotions are not just contained and channeled, but positive, energized, and aligned with the task at hand. Historical sources hint that Michelangelo may have painted the ceiling of the Vatican’s Sistine Chapel while in a flow state. It is reported that he painted for days at a time, and he was so absorbed in his work that he did not stop for food or sleep until he reached the point of passing out. He would wake up refreshed and, upon starting to paint again, re-entered a state of complete absorption. Bruce Lee also spoke of a psychological
state similar to flow in his book the Tao of Jeet Kune Do. There are three conditions that are necessary to achieve the flow state:
One must be involved in an activity with a clear set of goals. One must have confidence that he or she is capable to do the task at hand. The task at hand must have clear and immediate feedback. MMA champion and Karate master Lyoto Machida uses meditation techniques before fights to attain mushin, a concept that, by his description, is in all respects equal to flow. The Formula One driver Ayrton Senna, who during qualifying for the 1988 Monaco Grand Prix explained: “I was already on pole, [...] and I just kept going. Suddenly I was nearly two seconds faster than anybody else, including my team mate with the same car. And suddenly I realised that I was no longer driving the car consciously. I was driving it by a kind of instinct, only I was in a different dimension. It was like I was in a tunnel.” When challenges and skills are simultaneously above average, a broadly positive experience emerges. Also vital to the flow state is a sense of control, which nevertheless seems simultaneously effortless and masterful. GFI
Gulf Insider August 2013
33
Bahrain Hospitality
Elite Resort & Spa Palleras Night & Aqua Fiesta Paelleras Night at Al Noor Tent, Elite Resort & Spa, Every Wednesday from 730pm onwards Why not start your weekend a little early? Elite Resort and Spa presents Paelleras Night every Wednesday to add some Spanish zing to your week. Al Noor Tent, nestled between the pool and the gorgeous Muharraq Bay, becomes home to an exquisite seafood buffet from 7.30 pm onwards. The star attraction, of course, is the selection of paellas, made from the freshest ingredients and most fragrant rice. Be prepared for some gastronomical surprises! The atmosphere
is completed by the live entertainment and warm hospitality. Price: BD 15 net per person Aqua Fiesta at Elite Resort & Spa, Every Friday from 12pm onwards Families are invited to enjoy a sumptuous Friday brunch and a wide range of entertainment activities. Feast on a hearty Arabic buffet; start with a broad selection of mezzes and choose from a variety of grills; follow this with traditional main courses and delectable desserts. The spread also features international favourites. Guests can also
walk around the poolside, get traditional henna designs or have a Bassara (fortune teller) unravel mysteries of their future. Guests can also take a turn at holding a falcon or simply dive into the pool. Special games are organised for kids. Live singers will keep the mood upbeat through the whole afternoon as guests relax with a cup of tea and perhaps a second helping of dessert. Price: BD 12 for adults and half price for kids under the age of 11. GFI For reservations, for both events contact 36193444 or email: jumaa@elitegroup4u.com
Dubai Summer Surprises continues till 7th September
2 signature events to visit…
Dhs5 million in prizes plus 8 BMW cars will be raffled and given away to lucky shoppers spending Dhs 200.
Dubai Sports World : till 21 August The air conditioned arena at the Dubai World Trade Centre features action and excitement across the sporting spectrum –football, basketball, fitness, running, rugby, volleyball, tennis, cricket and action sports. Modhesh World: till 28 August Fun learning experiences such as a Heritage and Culture World, Art and Crafts Zone and a Boot Camp Challenge, to pure entertainment at the Mothers’ Zone, Princess Spa, Snow Park, Graffiti Wall, Kids Adventure World, Fun Fair Rides and a Kids Football Field. Throw in a Pets Farm, a Kids Pizza Making Room, an Electronic Games Area, a Laser Battle Room and a Video Games Zone, as well as a 9D Cinema Zone, and you know why every kid in town would want to be there. GFI
34
Gulf Insider August 2013
Workforce Feature
The multigenerational workforce The latest Regus Business Confidence Index reveals that 89% of Middle Eastern businesses are planning to increase or maintain headcount in 2013. With that in mind, Mark Dixon, CEO of Regus discusses how businesses in the region, and other parts of the world can employ any good candidate regardless of age.
M
uch has been said and written about ageing populations, a problem that is most acute in Japan, where over-65s currently account for 25 per cent of the population, and may account for 40 per cent by the year 2060. At the other extreme, meanwhile, there is the equally pressing problem of countries like Spain, where 55 per cent of young people are currently out of work. So what can we do to accommodate the older workers who might once have been considered past retiring age, while simultaneously offering opportunities to school leavers or graduates who might otherwise drift towards the margins of society? Let’s start at the senior end. At board level, for instance, experience matters above all. You want people who can make judgements based on first-hand knowledge, people who have witnessed failure as well as success, and understand the reasons for each. They are best placed to guide the executive team away from the bear traps and towards the most productive avenues of business. Older people have other advantages,
too. The Japanese construction equipment maker Komatsu now claims to rehire 90 per cent of its retirees – and no wonder, because those same people are prepared to work for 40 per cent less than their under-65 equivalents! Despite all these factors favouring older workers, there is still a widespread prejudice against them – as many over50s have discovered, especially in recession-hit economies. Only the most short-sighted of employers fail to recognise the value of young people in the workplace. Not only are they usually energetic and keen to learn; they are also much more adept at using IT and social media, which create new markets and business opportunities every day. It can be an uphill struggle, when there are precious few jobs on offer, and would-be entrepreneurs are frustrated by inadequate training or education, insufficient access to finance, or the absence of any enterprise culture. This is when employers should do everything they can to level the playing field. Why, for instance, insist on evidence of work experience, or references, when you
might set a test specific to the job in question so that every young applicant has an equal chance? So how do you attract the best of all the generations? You must be prepared to offer different things to different people. I was delighted to read in the Financial Times about three companies setting a great example: first, BMW redesigning a production line so that tools, chairs and flooring suited older staff – proving as productive as the rest of the plant, but with lower absence rates; then McDonalds in the UK finding customer satisfaction rising 20% in restaurants employing over-60s; and finally, Vita Needle, a family-owned steel tubing company relying on part-time staff with an average age of 74! What more proof do you need? For any sensible employer, age is irrelevant. All that matters is that you choose people with the right qualities for the job in question. That means being flexible in many different ways, and looking to recruit from the fullest possible range of ages.” GFI Gulf Insider August 2013
35
Dubai Expat Marraige
Dubai’s great expat marriage meltdown By Piers Grimley Evans
D
ubai sets innumerable couples on the road to financial security and professional achievement. Yet, they need solid relationships to survive the speed bumps. The pathway to success is littered with broken vows and wrecked marriages. “Dubai marriages are always on the hook,” says an Indian expat. “90 per cent of men have another woman, but don’t quote my name on that - I don’t want my wife worrying.” In the absence of statistical backup, one must hope this is an exaggeration. But counsellors and psychologists paint a picture that is decidedly bleak. What goes wrong? As a lawyer who now spends half her professional life dealing with breakups, lawyer Carol Alderson says both men and women initiate divorce. Over the last two years I have actually dealt with more women than men who initiate divorce,” she says. Whatever the underlying causes, 36
Gulf Insider August 2013
Alderson says shaky marriages tend to collapse with violence and infidelity. It’s either one or the other,” she says. But, as with divorce, incidence is hard to assess. Doctors and psychologists say violence can be aggravated by a lack of police intervention. One suggested that - especially with white women, who they may regard as prone to promiscuity - police are loath to intervene. “I think that the issues are the same as everywhere else, only bigger,” said an American marriage counsellor. It is a miracle to me there are not more killings.” That said, infidelity seems to comfortably pass violence as a cause of breakups. Alderson says it featured in around 70 per cent of the divorces she has worked on. “For this there is not really any bias it could be men or women,” she says. “Older men are often trying to recapture their youth with younger foreign women. However, over the last two years, I have encountered more women than men
who are unfaithful.” But behind it all, lurk the tensions and temptations of expat life. “Infidelity is actually rarely the real reason for divorce,” says Dr Raymond Hamden, a psychologist at the Comprehensive Medical Centre. First of all, Dubai attracts certain mentalities,” says Dr Roghayeh McCarthy of Belhoul Hospital’s Counselling and Development Clinic. They are not settled people. They come to Dubai as a place with no landmark.” Secondly, they are executive people. Often she has to sacrifice her career for his high-profile job. She loses her identity and becomes dependent completely,” she says. They think in the beginning they can make the sacrifice but after a while the malls and art classes cannot satisfy her.” Another group already have problems in their marriage. They think it will survive if they have more money and a babysitter. These marriages fall apart immediately. Suddenly he gets a more senior position.
Expat Marraige Dubai
On top, hard work makes for enhanced opportunities to stray. Long working days and business trips provide perfect occasions for colleagues to develop romantic relationships.
He becomes arrogant and his wife is not good enough,” she says. Crucially, when temptation kicks in, a permissive social context places no obstacles in its way. Such men have no friends or cousins here to laugh at them,” says Dr McCarthy. Here everything is allowed.” But, all said, there are just two risky areas for Dubai expat marriages - work and leisure. The intensity of Dubai worklife is the main factor for Dr Hamden. Not just marriage but family life is in trouble,” he says. People are here to do business, but they do not balance their lives.” “I meet a lot of lonely married women,” says a British marriage counsellor. “Employers make brutal demands and a lot of men are married to their jobs. If they work for international companies and across timezones, even days off do not belong to their families.” On top, hard work makes for enhanced opportunities to stray. Long working days and business trips provide perfect occasions for colleagues to develop romantic relationships. “Over 60 per cent of affairs start at the workplace,” says psychiatrist Dr Amer Saadeddin of Dubai Community Health Centre. “Many companies here are very big and they are continually taking on new staff.”
Not that enterprising husbands and wives cannot also find extramarital dalliance in their leisure time. “People socialise a lot more here,” says Brit expat Claire Malcolm. In the UK people generally do not live near the city centre and they don’t have a nanny to leave the kids with. Maybe it leads to more possibilities.” “When they come to Dubai, people feel that it is always summer,” says Belgian clinical psychologist Suzie Hachez. “They feel in a party mood and material support makes life easier. They are exposed to wider contacts, so they are also more likely to find a listening ear.” “It takes a lot to stay true to your beliefs,” she says. “It’s not just opportunity. It’s the environment, the attention, the stress - a new surrounding and a life they hadn’t imagined.” Not, of course, that all this leads inexorably to divorce. However, there is close to a consensus among professionals that couples need to watch out. For Carol Anderson tidying up the wreckage of marriages is now routine. After 13 years in Dubai, she finds family work now occupies half her professional life - and yet there is still unsatisfied demand for specialist legal expertise. “For ethical reasons I cannot represent both sides in a divorce,” she says. But I am frequently approached by both partners. I often wish there were someone else here with my background working in the field.” There are a lot of broken marriages here,” says British lawyer Carol Alderson. “When I first came here 13 years ago, I never expected family law to take up so much of my practice. Matrimonial cases now make up 50 per cent of my workload.” In broad terms, most other
professionals agree. Dubai can seriously damage relationships. But there is less consensus on how Dubai stands up to stiff international competition from other marriagewrecking metropolises. “Before coming here I was in Washington DC. There is no difference between the communities in the incidence of problems,” says Dr Raymond Hamden of the Comprehensive Medical Centre. “Our experience is that people come here seeking a geographical cure but a marital problem is only delayed by geographical change.” “Are there really more problems here than any other big city?” says Dr Amer Saadeddin, psychiatrist at the Dubai Community Health Centre. Maybe yes. But there are no statistics proving that. There is stress all over the world in a big city.” “Would marriages that fail here have survived elsewhere? Most of the people coming here are in their middle adulthood and they have been married for over five years. Their marriages may already be becoming routine or cold,” he says. But in the wider expat community, opinions diverge widely on Dubai’s compatibility with matrimony. “My personal impression is that marriages here are more stable,” says Jane Drury, group editor of ExpatWoman. com. It’s just a feeling, but the lack of financial pressures is a positive factor. Not having things can make you discontented. People here have quite a lot in their lives.” “As far as marital life is concerned, Dubai is quite risky,” says Nirmala S, an Indian expat who set up a support group for women in distress. “I think the main issue is long working hours. This also gives husbands an excuse for being out of the home.” GFI Gulf Insider August 2013
37
Feature AspenTech
Adaptive Process Control delivers greater profit By Rob Howard, Director of business consulting, AspenTech
T
he refining and petrochemical industry is reliant on improving return on assets and lowering operating costs to be competitive. In these challenging times, doing more with less is essential to driving better results. To deliver sustained economic benefits, refiners have adopted advanced process control (APC) technologies to improve product yield, reduce energy consumption, increase capacity, improve product quality, deliver consistent process safety and reduce environmental emissions. Essentially, APC allows companies to do more, save more and make more. In the last decade, model-based predictive control techniques have become a pragmatic choice in the industrial world and especially the oil refining and petrochemical industries. Many companies have recently reported that advanced control delivers benefits ranging from 2% to 6% of increased profit by reducing process variability and allowing plants to be operated closer to their true constraints. However, as the physical plant changes over time, APC models need to be maintained and updated or adapted or they no longer represent true plant behaviour. Whilst there have been significant benefits over the last ten years with sustained value tools they have not been able to solve the whole problem in an integrated, systematic way. First generation APC tools delivered a lot of benefits, but they did not solve
38
Gulf Insider August 2013
the biggest cost issues. With aggressive step-testing the cycles are much shorter, but they are more disruptive. Of course, when the controllers are off-line this results in lost capacity and benefit related to quality that normally accompanies an APC implementation. This type of testing requires constant supervision on the part of plant operators and engineers. The fundamental problem in the past was that the controller needed to be turned off to collect open-loop data suitable for the model identification technologies. Revamping a controller often required up to 80% of the original effort and cost. There is also the latent cost of the loss of capacity and quality. Another core issue that companies face is that APC maintenance was performed infrequently and the methodology used mirrored that of the initial project. That would produce some undesirable sideeffects. For example, maintenance was commonly deferred until turnarounds and the interim controller performance was allowed to degrade over time. Sometimes, operators would lose faith in the application and turn off the controller. The economic impact with APC maintenance is also a significant problem. The controller downtime, including revamp and turnaround in addition to normal downtime, can reduce total benefit by 35% across a five year cycle. By reducing some of these downtime periods and decreasing the amount of underutilisation that is sub-optimal performance, a company
can substantially increase the benefits of APC. Today, with a completely redesigned modelling environment and the introduction of Adaptive Process Control, companies can identify poorly performing aspects of the APC model and pinpoint the areas of the model needing attention. The additional benefits of Adaptive Process Control are to squeeze out costs by making improvements to existing solutions and adopting new technologies:
Reduce
controller labour costs
maintenance
Minimise erosion of benefits Return controllers to service faster
after turnarounds
Reduce
Controller Costs by 25%
Maintenance
Increase benefits by continually improving performance 10% increase in total APC benefits over 4 years One of the most significant differences with Adaptive Process Control is that companies now have the ability to collect new model identification data using small perturbation background testing as opposed to the aggressive step-testing methods traditionally used. GFI
Women workers Middle East
Women foreign workers growing in importance in Middle East
T
he paper, ‘Women Migrants, Remittances and Their Impact in the Gulf Cooperation Council (GCC) region’, was authored by Dr. Ismail Hakki Genc, Professor of Economics, and Dr. George Naufal, Assistant Professor of Economics, at the American University of Sharjah. It examined macroeconomic indicators and available research on women workers in the Middle East as well as in other regions. The paper found that women have become increasingly independent when it comes to financial matters, both in the Gulf Cooperation Council (GCC) states where they have gone to work and in their home countries when their husbands work overseas.
Recommendations
The report highlighted that many women are employed in unskilled jobs incommensurate with their education levels. For example, almost 60 per cent of female expatriate workers in Dubai hold a university degree or higher graduate degree. This suggests that highly educated women should be supported by their home and host countries to reach their full potential, the report said. Some 78 per cent of female expatriate remitters in Dubai send money home to the older generations of their families. This suggests that host country policies that unite families would have
a significant impact on women and stem the outflow of remittances from the GCC. The authors also recommended that women be given more of a voice in family financial decisions by having more access to family resources. Moreover, the role that female migrants play in promoting economic development in their countries of origin should be recognized and policies put in place in their home countries to promote this. “Well-designed policies – which could include support groups, as well as opportunities and facilities for expatriates to observe cultural traditions and celebrations – would attract workers, raise the status of the host country and increase global economic efficiency by reducing unemployment,” Dr. Naufal said. “Through these measures, the positive impact of expatriate women in both their home and host countries would increase significantly”.
Western Union launches Facebook campaign
In conjunction with the release of the research paper, Western Union is inviting expatriate women to share their stories of success in their host countries while supporting their families. Entries will be accepted on the Women Icons Facebook page, and vocational training courses will be awarded to the authors of the top three stories. GFI
Key findings: ¡ Women are more reliable than men when remitting funds to their families back home. In 2008 we found that in 12 months, the mean remittances of female expatriate workers in Dubai were almost AED 2,000 more than the remittances of male expatriates. ¡ Women tend to allocate more resources to support family living expenses and human capital, compared with their male counterparts, who tend to focus on building physical capital. ¡ Women are also more likely to act as a safety net for their family back home during emergencies and bad economic times. Some 52 per cent of female expatriates in Dubai allocate a portion of their overall remittances for such eventualities, compared with just 5 percent of all expatriate workers. Dr. Genc said: “Women’s spending and remittance habits are skewed toward the buildup of human capital, one of the most effective means of driving economic development.”
Gulf Insider August 2013
39
Turkish Airlines Advertorial
A winner yet again, at the 2013 Skytrax World Airline Awards!
The ‘Flying Chef’ service for Business Class passengers, on its long flights made Turkish Airlines a winner in the “Best Business Class Catering” category.
T
urkish Airlines has done it yet again! The airline stood out, at the 2013 Skytrax World Airline Awards with air travellers voting it as the “Best Airline in Europe” for the third year. The ‘Flying Chef’ service for Business Class passengers, on its long flights made Turkish Airlines a winner in the “Best Business Class Catering”category. These awards in addition to the “Best Airline in Southern Europe” title and the “Best Premium Economy Class Airline Seat”, for its comfort class seats were presented to Temel Kotil, CEO of Turkish Airlines by Edward Plaisted, CEO of Skytrax. Skytrax is the world leader in ranking aviation offers. The survey operated over a 10-month period, and more than 100 nationalities from over 160 countries around the world participated. Popular with passengers, Turkish Airlines continues to be one of the world’s leading airlines with substantial investments in recent years, multiple awards, impressive growth figures, large-scale aircraft orders and a continuously expanding route network.
Another Gateway to the Americas with Europe’s Best Airlines: Turkish Airlines is pleased to announce the launch of flights to our 6th destination in North America. With a growing integrated network currently spanning 100 countries and over 230 choice destinations the airline is ranked 4th in terms of network size worldwide. Effective 12th May 2014 you can fly Turkish Airlines, to Boston five times weekly on Mondays, Wednesdays, Fridays, Saturdays and Sundays. As of 9th June 2014 the frequency of flights increases to 7 times weekly with one flight a day.
CEO of Turkish Airlines, Temel Kotil’s glorious moment! 40
Gulf Insider August 2013
Miles & Smiles Programme: Enjoy mileage accrual, special branded purchases, car rentals, hotel accommodation, concessional mileage purchase, mileage freeze & extension and mileage transfer with Turkish Airlines. GFI
turkishairlines.com | bahcustomer@thy.com | 17516100
Voted Europe’s Best Airline 2013 at the Skytrax Passenger Choice Awards.
Cars Maserati Quattroporte
2014 Maserati Quattroporte By Nick Cooksey
M
aserati have been making the Quattroporte since 1963, and they just keep getting better and better… well actually that’s not quite true. The model range went through a terribly dull period from the 1970s up to about ten years ago, but in the years following, Maserati, and the Quattroporte, have certainly got back on track. The latest 2014 model is the sixth generation of the range and is noticeably bigger than its predecessor. It is also noticeably better. It is something to
42
Gulf Insider August 2013
behold. The car I collected from Euro Motors to drive around Bahrain was a twin turbo 3.8 litre V8 high tech super refined monster in badass black (my colour term, I’m sure Maserati calls this colour by another name). Its fantastic smooth and awesomely powerful engine, which knocks out an impressive 523 BHP with 524 pounds of torque, is made by Ferrari and takes the car from zero to 100 kph in just 4 seconds. Maserati claims that this makes it the fastest sedan in the world. When I put my foot down on the
highway this car took off. The feeling was rather exhilarating. And then I realized it wasn’t even on Sports Mode, which when activated made things RATHER EXHILARATING!!!! There is also a V6 404 bhp version of this car available. Less powerful, and less pricey. I had the honor to actually watch the production of Maserati engines when I visited the Ferrari factory in Maranello, Italy last month, and saw them being intricately assembled within a glass walled hermetically sealed room by
Maserati Quattroporte Cars
Maserati claims that this makes it the fastest sedan in the world. When I put my foot down on the highway this car took off.
super high tech computers with long, fast, powerful arms. Sitting inside the car you feel cocooned in luxury. The interior is stuffed full of high quality fittings and beautifully stitched leather. There’s an amazing sound -system, and situated in the middle of the dashboard there’s an unusually large and easy to operate touchscreen to control the in-car entertainment system. It also has big shift paddles, which all cars should have but don’t. Changing up and down the 8 speed gearbox is quick and easy. The gearbox by the way is the same as that used by Audi, BMW and Jaguar. The overall ride feels great - perfectly balanced. The distinctive muscular sound this car makes when it passes you cannot really be appreciated when sitting inside, even with the sound system switched off, due to extensive soundproofing. This is a big, beautiful, powerful sports car full of the very finest Italian flare. Even the name, Quattroporte, sounds exquisite, though it actually means in Italian “four door”! Maserati as a company is going from strength to strength, particularly since they made their decision to move from the small scale production of specialist sports cars to become a full line up luxury car manufacturer with the aim of taking on the luxury German brands. Expect an SUV from them shortly – yes really, it’s coming very soon! GFI
For more info call Euro Motors in Bahrain on +973 17 750 750 ext. 6657
Gulf Insider August 2013
43
Cars Bentley Mulsanne
BENTLEY MULSANNE Nick Cooksey drives the new Bentley Mulsanne from Strasbourg to London.
I
was invited last month to test drive the new Bentley Mulsanne from the picturesque French town of Strasbourg to London. It was, of course, an offer I couldn’t refuse. I arrived in Strasbourg hoping for some respite from the blistering Bahraini summer, but was welcomed instead by all-too-familiar temperatures of 40°C. France was experiencing a heat wave, and Strasbourg was the hottest place in France at the time. Children splashed in the public fountains and many beautiful young women walked by in colourful and revealing summer dresses. This is where I have my first encounter with the majestic car that will be my companion over the next few days. It has the biggest headlights I have ever seen on a car. I notice unusual details like flattened exhausts. The overall impression is one of formidable size and power. It is a car that makes an impressive statement. I cannot wait to get behind the wheel and begin my journey. Surprisingly for a car of its size, it handles effortlessly along the winding country roads. My female co-driver has only ever driven
44
Gulf Insider August 2013
I nestle comfortably in the lap of luxury. her little compact car and hesitates to get behind the wheel, but with a little persuasion she tries it out and loves it so much that I eventually have to wrestle it back from her. I nestle comfortably in the lap of luxury. The engine, powerful as it is, makes almost no sound, and the interior is opulent. The seats are beautifully handstitched cream leather, and all the fittings are highly polished wood. The back seat is especially plush and comfortable, with plenty of room to stretch one’s legs on the long drive. It is a work of art. As you would expect, the car comes equipped with a cutting-edge infotainment system, but it is carefully concealed so as to not detract from Bentley’s old-world charm. The 20-speaker hi-fi system makes for the most amazing sound quality imaginable in a car. This is a stately British palace on wheels. It is on the motorways that I finally get a taste of the Mulsanne’s muscle power. This is a fast car, and it feels almost as
if it responds to my thoughts. Under the bonnet lies a 6.75 litre V8 engine; coupled with the luxuriant interiors, this means that I can fly down the motorway, at speeds best not disclosed, and not feel a thing. When I later have to slow down to a more-legal speed it feels like I am crawling. I drive the car onto the Eurostar train at Calais and make the short journey to London. I might have complained about the London traffic, but it is impossible to be in a bad mood when you are so comfortable. The Mulsanne moves through traffic with great dignity and draws envious looks. As long as I am seated in it, I am a VIP. At around $350,000 the Mulsanne certainly does not come cheap, but it is the epitome of luxury. Over the course of the 700 or so kilometres, the Mulsanne easily won me over. GFI
Rolls-Royce Cars
ROLLS-ROYCE WRAITH MAKES ITS BAHRAIN DEBUT Euro Motors celebrated 10 years representing the Rolls-Royce brand by hosting the launch of the most powerful Rolls-Royce in history.
T
he Rolls-Royce Wraith, the most powerful and dynamic Rolls-Royce in history, made its debut at the Ritz-Carlton Bahrain. “Today we launch the ultimate gentlemen’s gran turismo, a car that embodies the spirit of Charles Stewart Rolls.” commented Geoffrey Briscoe, Regional Director, Middle East, Africa and Latin America, Rolls-Royce Motor Cars. “Wraith will definitely attract a
new demographic to the brand, it is a car that will appeal to a slightly younger audience, and one that will quickly establish itself as the ultimate gentleman’s gran tourismo,” said Mr. Paul Yates, General Manager of Euro Motors. Performance is effortless, but dramatic, thanks to a V12 engine married to 8-speed automatic ZF transmission. 624 bhp / 465kW is available to the driver while the 0-60 mph sprint is achieved in 4.4 seconds,
compared with 563 bhp /420kW and 0-60 in 4.7 seconds for Ghost. However, Wraith is no GT bruiser. Agility improvements have been achieved with absolutely no compromise to the sensation of riding on a bed of air. Furthermore, the debut of Satellite Aided Transmission (SAT) technology takes the powertrain to a new level of effortless delivery, one that perfectly suits the Rolls-Royce brand. GFI
Is this the world’s fastest jet ski?
A
new supercharged jet ski claims to be so fast that it ‘practically pullls your arms off’.The Black Edition 360 Sea-Doo has a top speed of 130 kph and is as powerful as a Porsche, according to its manufacturers. It is quicker and more powerful than any other commercially-available model. The ultimate special edition beach toy has a terrifying 360 brake horsepower the same as a Porsche 911 sports car. However, so much power does
not come cheap. Adrenaline junkies will have to splash out $30,000 to ride waves this fast. Just 100 of the special edition models are being made by manufacturers 15 8 p e r fo r m a n c e . They pack 100 brake horsepower more than the standard version. Eight-time world jet ski champion James Bushell, who is a partner at 158performance, was the first rider to test the new machine. He said: ‘It practically pulls your arms off - this isn’t one for the weak-wristed.’ Although the Black Edition 360 is not technically the fastest-ever jet ski in a straight line, the makers claim its power while turning makes it the fastest overall so that it will bit be beaten on any race
By Sarah Griffiths
course. The limited production batch of 100 are expected to be sold to customers including in the Middle East. A spokesman for 158performance, based in the UK said: ‘This is our most exciting product ever. ‘If you want to thrash everyone else on the water or pose at the beach, this is the one for you.’ The Black Edition 360 Ski-Doo’s Specifications: Engine: Rotax 1500cc 4 Tec engine Engine management: 158 Mapped ECU for improved acceleration and top speed Steering: Lowered race steering system and handlebars - for a lower centre of gravity and improved handling Exhaust: Free flow sports exhaust GFI
Gulf Insider August 2013
45
Feature Social Media
30% Surge in Social Media
Activity During Ramadan
T
he Online Project (TOP) social media agency launched a report analysing behavior trends of consumers in eight Middle Eastern countries during the Holy Month. The results show that residents of the Middle East use social media platforms 30% more during the Holy month whilst also shifting the time of the day that they engage with social media communities to much later in the day. In addition, engagement with brands is hugely multiplied during Ramadan. TOP observed Facebook and Twitter activity in nine different countries across the region including: Bahrain, Egypt, Jordan, Kuwait, Lebanon, Oman, Qatar, KSA and the UAE to provide a general overview of social media trends in the region looking specifically at levels of engagement, sentiment and perception and the timings of their interaction. History shows that during Ramadan consumer spending spikes and therefore Middle Eastern companies boost their spending on traditional ‘off-line’ campaigns by 20% during Ramadan, for example, the four largest telecoms companies spend around $200 million dollars during the month. Zafer Younis, CEO of The Online Project said: “Having discovered that social media consumption and user habits
46
Gulf Insider August 2013
significantly change during the Holy month, we set out to study the outlying variable of this change to isolate the driving forces. We monitored thousands of tweets and Facebook posts in nine countries to study the user behavior. Instead of looking at their social media platforms first thing in the morning when they wake or get into work, our results show that during Ramadan, people are most active on Twitter early evening at approximately 7pm, just before they break their fast. Following analysis of the figures, TOP has put together their top five recommendations for making the most of communicating with consumers during Ramadan: 1. Recognize that Ramadan is a unique time in the Arab world both online and off and as a result, lessons you have learnt about your communities during the year may not apply during the holy month so adapt your campaign to recommended timings to make the most of the advertising Dollars you have spent. 2. Align your publishing times with your audience and maximize engagement. 3. Optimize your content mix as user interests’ shift during the Holy month.
During Ramadan consumer spending spikes and therefore Middle Eastern companies boost their spending on traditional ‘off-line’ campaigns by 20% during Ramadan. Adapt your content accordingly to stay relevant and build stronger relationships with your audience. 4. Increase your advertising support budgets during Ramadan. The Holy month enjoys higher organic engagement rates so your budget can push your content further in Ramadan. 5. Implement integrated marketing campaigns by interlacing social media usage increase in-line with TV, radio, and print consumption to deliver higher multiplier effects in Ramadan. GFI
Feature Gadgets Technology
Shield This one’s a handheld console with a 5-inch display. Powered by the Tegra 4 chip, the Shield can run more-or-less all Android games under the sun. An interesting feature is that you can stream the game you are playing on your PC, on to the Shield; though this requires a Nvidia GeForce GTX 680 or higher on the computer.
GamePop There is a regular one and a GamePop Mini. Instead of selling games, the GamePop has its own subscription-based service that essentially gives you access to its entire game library as long as you pay the subscription fee. The GamePop Mini is apparently as good as the GamePop at playing games but it doesn’t have some of the ports and so may not be compatible with all of the accessories released for the GamePop.
Tech picKs Are you a player?
This month we bring you, four fantastic Android gaming consoles; so take your pick! Ouya This one runs on a Tegra 3 chipset. With this and the 1GB of RAM, the Ouya is a fantastic choice even for your high-end games. It comes with one controller though you can buy extra controllers for an additional cost. The games on the Ouya are freeto-play and many include the in-app purchases. Currently, the Ouya boasts around 200 games on its game store.
GameStick This console is like your regular USB flash drive and really portable. It plugs into the HDMI port on any HDTV, and if the TV is MHL-compatible, it also draws power from the same port. For older TVs that aren’t compatible with MHL, the GameStick comes with a USB cable as well as a power adapter. The console has 1GB of DDR3 RAM with 8GB of in-built storage and great connectivity. It supports mouse and keyboard setup and HD video decoding.
Gulf Insider August 2013
47
Feature Arabs in London
Arabs return to London
for summer
...and bring their cars with them
A
mong the extraordinary cars seen on the streets of London this year has been a customised blue-and-white Bugatti Veyron from Saudi Arabia known by the nickname L’Or Blanc, or White Gold. It was also in London last year, and has bodywork inlaid with delicate, highly polished white porcelain. The Arab “invasion” isn’t good news for everyone. The problem is noise. Specifically the sheer volume of the roar that visiting supercars make on quiet backstreets — day and night. Residents are also concerned by the allegedly dangerous manner in which many ‘Gulfies’ drive. YouTube contains clips of, among other things, a Lamborghini Aventador performing a full-throttle ‘power slide’ at speeds of around 80mph, around the corner of a leafy Belgravia street. In 2010, another car, also a Lamborghini, wrecked four parked cars
Image: Alex Penfold/ SWNS.com This Ferrari is bound to grab attention with its velvet-covered roof
Image: SWNS.com Qatari registered Pagani Huayra and an orange Lamborghini 48
Gulf Insider August 2013
Image: Robin Bell A $3 million Bugatti Veron
Arabs in London Feature
in Knightsbridge, after spinning out of control. Its driver and passenger, both from Abu Dhabi, were arrested. During the Ramadan Rush, roughly 80 per cent of guests at London’s top hotels are from Arab states. They are crucial to the restaurant trade, and make a huge contribution to the bottom line of high-end retailers. Figures from the taxfree shopping firm Global Blue suggest they spend an average of £1,000 per transaction, more than visitors from any other region. Yet no one, however wealthy, is above the law. In response to complaints, Metropolitan Police officers are instructed to ensure overseas vehicles are insured and carry legal number plates. GFI
Image: SWNS.com $1.5 million Bugatti Veyron Grand Sport
Image: SWNS.com Two Qatar-registered Hamann-tuned BMWs with a Lamborghini Aventador sandwiched in the middle
Image: SWNS.com $800,000 Qatari-registered Mercedes McLaren SLR ‘Mansory Renovation’
A Qatari-registered Lamborghini Aventador
Image: PA Lamborghini Aventador from Qatar which was seized in Knightsbridge by police for being driven illegally without insurance. It spent 24 hours outside New Scotland Yard, before being returned to its owner, who had presumably paid a hefty fine. By Thursday night, the vehicle was parked outside a bar in Mayfair.
Image: Chris Eades A Dubai registered Bugatti Veyron, the fastest and most expensive production car in the world
Image: SWNS.com Kuwaiti-registered Rolls-Royce Ghost gets towed away after not having the correct documentation
Gulf Insider August 2013
49
Feature Advice
Last Words... Separate criticism from cynicism,
from Scott Belsky, founder of Behance, via LinkedIn: A key to discerning feedback is knowing the difference between criticism and cynicism. Belsky says that criticism is doubt informed by knowledge. Cynicism, on the other hand, is doubt informed by ignorance. Unlike criticism, it does not come from curiosity or information. “Learn to savor criticism and shun cynicism by developing an instinct for the difference between the two.”
Manage yourself, from Jed Yueh, chief
executive at Delphix via The New York Times: “If you don’t manage yourself very well, it’s hard for you to maximize the performance of a team. And managers can either increase or decrease motivation for their teams. They can either increase or decrease clarity for their teams. They can either build cultures that are highly collaborative and capable of solving problems quickly, or they can create cultures where you have a lot of paralysis and it’s very difficult to make decisions.” Ultimately, it boils down to managing yourself well.
Hard work is not the point, from
Steve Case, founder of AOL and Chief Executive of Revolution, via The New York Times: “The art [of leading] is to set the priorities and assemble a team so you wake up in the morning and actually have nothing to do. Case says appearing to work hard is not the point. He learned from his mentor and AOL co-founder Jim Kimsey that the real priority should be about setting the right framework for himself and his team. “The objective should not be looking busy, but actually
50
Gulf Insider August 2013
creating a process that allows great things to happen”.
How to criticize, from Jonah Berger, Wharton professor and author of “Contagious: Why Things Catch On” via LinkedIn: “Suggesting improvements isn’t always easy. Berger says that rather than saying strictly what you don’t like, you should sandwich criticism between two positives. Start with something affirmative, add constructive feedback, then close with a positive compliment. By starting and ending with something positive, you show people that you’re not attacking them, and they will be more likely to listen. Create a culture, from Jim Collins, author of “Great By Choice”, via Inc: A great leader is able to turn a company into a movement by inspiring a culture that pushes people to reach their highest potential. Doing this requires a unique mix of discipline and creativity. “Great leaders in any generation have always helped people understand why. Mediocre leaders don’t ... Greatness is rare. It’s so rare that, when you come across it, it often feels like it’s new.” Say “no”, from Azita Ardakani, CEO and founder of digital media agency Lovesocial: “It’s easy to want to say ‘yes’ to everything, but for us, saying ‘no’ keeps us specialized, and ensures that we over deliver every time. It keeps us focused on building for the longterm as opposed to being reactionary.” Ardakani says that making a quick buck off projects that do not match your value proposition can distract from long-term goals and can inhibit your company’s
ability to consistently perform at its best. “Sometimes saying no is the best sales strategy.”
How to interview, from Jack and Suzy Welch, business leaders and contributors via LinkedIn: “It’s just too easy to fall in love with a shiny new candidate who is on his best behavior, telling you exactly what you want to hear and looking like the answer to all your prayers. That’s why you can never hire alone.” Jack and Suzy say the biggest hiring mistake employers make is trusting their gut, instead of balancing it with reason and other opinions. They recommend having a team with at least one “hard-nose” that is hard to please and can “sniff out the phonies.” And, let the interviewee do most of the talking. “In interviews, ask candidates about their last job — and then shut up for a good, long while. As they describe what they liked and what they didn’t, you will likely hear much of what you really need to know”. Watch and listen, from Francesca
Zambello artistic director of the Washington National Opera via The New York Times: “If you think you’re smarter than everyone else, your team will pick up on that and will refrain from speaking up. When you make yourself the center of the conversation, you end up missing out on a lot of great ideas from your coworkers. Sometimes, you just need to let other people speak. You’ll be surprised at how much happier and more productive your team will become. When I go into meetings with successful business people I’m always amazed at how much they’re able to just sit there and absorb things and then make a really good decision.” GFI
Expose
Your
Business ProDesign Arabia’s graphic design services covers a vast area for print, from designing your business cards to leaflets, flyers and posters.
Graphics and
Web desiGn
Media and Public Relations With over ten years experience in the Media industry, and a strong team that collectively has over 50 years experience, our team can make words work for you with clear, concise copy that speaks the language your audience understands... and most importantly, responds to.
Branding We work closely with you to understand the needs of your organisation. We listen to what your goals are and then dedicate the time to truly reflect your vision in a unique brand identity with a bespoke logo and stationary to accompany.
ProDesign Arabia offers a wide range of publishing solutions - design the look, create the style guide, write the copy, think up creative headlines and captions, sub-edit and then send it to the printers.
ArAbic TrAnslATion ProDesign Arabia strives to provide reliable Arabic and English document translation services of the highest caliber, and at a competitive price.
ContraCt Publishing For more information contact: +973 3652 0004
sales@prodesignarabia.com