ROUHANI TOUR | Page 3 RUSSIA PLAN | Page 14 Airbus jets, Govt allots Fiat cars $1.7bn for real on wish list economy Tuesday, January 26, 2016 Rabia II 16, 1437 AH SHARES FALL 11% SINCE OCT ’15: Page 15 Apple growth seen GULF TIMES slowing as iPhone BUSINESS demand wanes Qatar PPI plunges 39% y-o-y in Oil market is going to start November 2015 By Santhosh V Perumal Business Reporter Precipitous decline in the prices of crude and natural gas, basic metals, refined petroleum rebalancing, says al-Sada products and basic chemicals led Qatar witness about 39% plunge year-on-year (y-o-y) Opec secretary-general urges in the producer price index (PPI) in November non-Opec to help tackle excess 2015, according to off icial figures. supply; evaluating whether to The PPI for the industrial sector — a measure hold emergency meeting; Iraq of the average selling prices received by the aims to raise oil output further domestic producers for their output — fell 5.4% this year compared to that in October 2015 mainly on lower prices of crude and natural gas, basic Reuters metals, dairy products, grain mill and basic London chemicals, said the latest figures released by the Ministry of Development Planning and Statistics (MDPS). E the Minister of Energy The PPI for mining, which carries the and Industry, Dr Mohamed maximum weight of 72.7%, saw the maximum Hbin Saleh al-Sada, said yes- plunge of 43.2% y-o-y in November 2015 due terday the oil market was poised to to a 43.3% fall in the prices of crude petroleum start rebalancing itself after prices and natural gas; even as stone, sand and clay sank to their lowest since 2003, a prices firmed up 2.5%. sign the exporter group will stick The mining sector PPI saw 7.5% decline month- to its policy of not cutting supplies on-month in November with crude and natural without help from rival producers. gas price falling 7.5% and that of stone, sand Oil prices have collapsed to below and clay by 0.1%. $28 a barrel this month from $100 in The manufacturing sector, which has a weight mid-2014 on a supply glut. The drop of 26.8% in the PPI basket, tanked 27.6% y-o-y gained impetus after the Organisa- in November 2015, explained by a 31.5% plunge tion of the Petroleum Exporting in the price of basic metals, 30.6% in refined Countries in late 2014 shifted strat- petroleum goods, 25.2% in basic chemicals, egy to defend market share, not 5.2% in man-made fibres, 2.4% in dairy prices. products, 1.4% in grain mill, 0.9% in rubber and The price drop has started to slow plastic products and 0.7% in paper and paper the development of relatively ex- products. pensive supply sources such as US But there was 11.7% increase in the price of shale oil and forced companies to cement and other non-metallic products, 5.2% delay or cancel billions of dollars’ in juices and 3.3% in beverages. worth of projects, putting some fu- The manufacturing sector PPI was down 1.2% ture supplies at risk. against that in October 2015 on account of “We expect that we will go 5.8% fall in the price of basic metals, 4.2% through one more downturn cycle in dairy products, 2% in grain mill, 1.8% in of oil price. But we will recover. The basic chemicals, 0.2% in refined petroleum market is defi nitely going to balance “We expect that we will go through one more downturn cycle of oil price. But we will recover,” says HE al-Sada. products and 0.1% in rubber and plastic itself because today’s oil price is not products. sustainable whatsoever,” al-Sada, conference at Chatham House. Badri said. “This is now central to icy shift, have opposed earlier calls of sanctions on Iran, Iraq’s plan to But there was a 1.7% jump in the prices of man- told a conference in London. Earlier, Badri said Opec and non- the return of a balanced market.” for emergency meetings. further expand supplies and no sign made fibres, 0.8% in beverages, 0.4% in juices Speaking at the same conference, Opec producers needed to work to- The price slide has squeezed in- Al-Sada said the request was be- of Saudi Arabia cutting back from and 0.2% in cement and other non-metallic Opec Secretary-General Abdullah gether to tackle an excess of oil in- come in producing nations and is ing considered although he declined near-record levels. products. al-Badri said he also saw reason for ventories so prices can recover and particularly painful for Opec mem- to say if he was in favour. Iraq may further raise oil output The electricity and water group, which has a optimism, citing forecasts for fur- investments in new fi elds begin. bers such as Venezuela, who depend “We received a request and oil in 2016, reaching levels as high as mere 0.5% weightage in the PPI basket, saw ther growth in global oil demand in So far, major non-Opec produc- heavily on oil income and lack the ministers are discussing that,” he 4mn barrels per day (bpd) from the its index fall 2.1% y-o-y in November 2015 with 2016 and a contraction in non-Opec ers such as Russia have refused to capacity to pump more. said. “It is being evaluated.” Qatar country’s south, a senior Iraqi oil electricity and water prices declining 2.3% and supply. work with Opec by cutting supplies, Venezuela has requested Opec holds Opec’s rotating presidency offi cial, who asked not to be named, 1.8% respectively. “We already see some signs that although Oman and Azerbaijan have hold an emergency meeting to dis- this year. said yesterday. The index, however, shot up 5.6% against the supply and demand fundamen- expressed willingness to do so. cuss steps to prop up oil prices. But While non-Opec supply is ex- Iraq has been producing from its previous month on 10.8% in the price of water tals will start to correct them- “It is vital the market addresses Opec’s Gulf members including pected to fall this year, output from southern fi elds around 3.7-3.8mn and 2.3% in electricity. selves in 2016,” Badri said at the the issue of the stock overhang,” Saudi Arabia, who led the 2014 pol- Opec could rise following the lifting bpd in recent months. Page 16 Qatar’s ICT sector ‘key beneficiary’ of economic diversification Mandatory insurance to drive growth Qatar’s ICT sector has been a “key beneficiary” of the of GCC healthcare sector, says EY government’s drive to diversify the economy away from hydrocarbons, notably through he GCC’s (Gulf Cooperation Council) delivery models and partnerships,” accord- said, adding about 20%-30% of GCC pub- its e-Government 2020 Strategy healthcare market — especially spe- ing to him. lic hospital beds are currently being occu- and “strong support” for the Tcialised centres of excellence (CoEs), Demand for specialised CoE is growing pied by LTPAC patients. On future poten- development of smart cities, home healthcare services, long-term and rapidly as the burden of disease shifts from tial for biopharmaceuticals and medical BMI has said in a report. post-acute care rehabilitation (LTPAC), the public sector to the private sector, EY disposables; EY said the GCC region has The Fitch Group company biotechnology, medical disposables manu- said, adding most GCC public hospitals are strong infrastructure in place for the crea- holds a “positive outlook” on facturing and primary care services — has functioning at more than 80% bed capac- tion of a sizable pharmaceutical manufac- the Qatari economy and the been identifi ed as areas of high demand and ity, which is putting pressure on the private turing base. IT market as a whole despite growth in the region in 2016, according to sector and specialised clinics to service more The development of dedicated bio- the global oil slump that has Ernst and Young (EY). patients. technology platforms and incubator pro- lowered oil prices since 2014. “The healthcare sector has been growing Observing that a substantial number grammes such as Dubiotech in the UAE, IT market growth in Qatar, it upwards of 10% per annum across Middle of patients are seeking specialised treat- Jeddah Biocity Park and Badir for biotech- said, will be maintained by large East and North Africa (Mena), with sig- ment abroad, developing more CoEs lo- nology in Saudi Arabia is creating a healthy government programmes, government agencies and CAGR of 8.6% in local currency nifi cant potential for growth in quality care cally would help meet their unique needs ecosystem for biotechnology to grow. modernisation eff orts and public state-owned companies, at terms. over the next few years. Mandatory insur- and reduce the need to travel overseas for The GCC medical disposables sector, sector initiatives aimed at hosting least over the next two to “The dominance of oil and ance has been and will continue to be a big treatment; it said developing more CoEs while growing at a very fast rate, is mainly the FIFA World Cup in 2022. three years. According to BMI, gas in the local economy driver, particularly in Qatar, Saudi Arabia would also bring in more medical tourists import driven. With only 7% of total GCC This is all set against the computer hardware sales in limits the size of the software and parts of the UAE,” Amit Zushi, partner, as well as attracting and retaining highly medical disposables sales being contrib- backdrop of Qatar’s high Qatar would exceed QR4bn in market, but scope remains EY, said.