S&P Forum to Explore Opportunities and Challenges in Saudi Debt Capital Markets

A Forum hosted by Standard & Poor’s Ratings Services (S&P), the world's leading provider of independent credit risk research, analytics and benchmarks, will discuss the opportunities and challenges facing conventional and Islamic bond issuance in Saudi Arabia. The event is set to take place in Riyadh on Tuesday, 1 April, 2014.

Under the theme of ‘Navigating the Risk Dimension in 2014’, the Forum will explore a wide range of developments shaping the growth of Saudi debt capital markets in the context of key rating analytical, process and criteria developments. The event is designed for CEOs, CFOs, treasurers, advisors, bankers, financial intermediaries and institutional investors.

Stuart Anderson, Managing Director & Regional Head, Middle East for S&P said: “A variety of factors are creating a strong impetus for growth in Saudi and GCC capital markets including strong economic prospects; continued need for infrastructure investments; new regulation supportive of capital markets, including the implementation of Basel III; growing demand for Islamic Finance; and low interest rates resulting from accommodative central bank policies around the world.”

The S&P Forum will outline how ratings can further support the growth of deep and liquid debt capital markets. “Ratings greatly enhance the transparency and efficiency of debt capital markets, generating greater local, regional and global exposure for issuers, and contributing significantly to their development and diversification for the benefit of investors and financial market intermediaries,” Anderson said. The event will discuss ratings prospects for four key sectors - Corporate and Infrastructure; Sovereign; Banking; and Insurance.

The last three months of 2013 saw increased issuance in GCC capital markets, driven partly by growth in Islamic finance. This momentum has continued into the first quarter of 2014, with Saudi Electric Co.’s Saudi Arabian riyal (SAR) 4 billion sukuk being one of the key issuances this year among S&P-rated companies.

Corporate and infrastructure issuers in Saudi Arabia and the region have benefited from sustained positive economic fundamentals and strong appetite from regional and international investors for high credit quality paper. Among GCC sovereigns rated by S&P, Saudi Arabia is the only one to have a positive outlook, while all others carry stable outlooks.

The liquid banking sector is another key factor that underpins the positive credit profiles of corporate and infrastructure issuers both in the Kingdom and the region. The overall profitability of Saudi banks will be a highlight of the discussions at the Forum. Over the last year, Saudi banks have fared better than their peers in developed markets, showing consistently strong profitability and low risk profile.

Andreas Kindahl, Managing Director, S&P Ratings Services will present his outlook on the Corporate and Infrastructure sector in the region while S&P analysts Christian Esters and Timucin Engin will deliver their prognosis for GCC sovereigns and the banking sector respectively. Other S&P analysts Karim Nassif and Kevin Willis will lead workshops on Corporate & Infrastructure and Insurance ratings.

Michael Baker, Managing Director and Head of Solutions & Services, S&P Capital IQ will present case studies on credit risk modelling in the GCC

German retail trade logs surprise gain

German retail trade posted surprising turnover gains in February, the National Statistics Office (Destatis) reported on Monday.

Destatis said revenues in the sector rose by 1.3 percent in real, price-adjusted terms compared with the previous month. This came as a surprise as analysts polled by Reuters had penciled in a 0.5-percent drop for the month.

In a year-on-year comparison, retailers' turnover jumped by 2 percent in real terms. Destatis noted the biggest driver was the sale of clothing, shoes and leather goods, which surged by 6.1 percent.

Robust labor market

Almost equally successful was the sale of pharmaceutical and medical products, while trade in household appliances and food items was sluggish throughout February.

Germany's retail umbrella organization, HDE, said it expected a 1.5-percent rise in turnover throughout the current year, up from a 1.1-percent increase in 2013.

Retailers continue to profit from a generally positive consumer mood in the country against the background of low unemployment and the prospect of more wage hikes in many industries as the market research group GfK confirmed last week.

However, a large proportion of the money Germans were willing to spend was found to be going into holidays, services and refurbishing.

Free-trade pact could hit developing countries

Since July last year, the EU and the US have been negotiating a Transatlantic Trade and Investment Partnership (TTIP). This free-trade agreement would reduce trade costs between the US and the EU, according to Julia Kubny of KfW Development Bank.

'This would mean a bottle of wine from Italy would be cheaper for the US consumer, who might thus be more likely to buy the Italian instead of Chilean wine,' she said. 'More trade between the EU and the US tends to lead to less trade with other countries.'

The EU and the US together account for around a third of world trade. By creating the largest free-trade zone with 800 million consumers, world per capita income is expected to rise by more than 3 percent. These are the findings of a study by the Munich-based Ifo Institute for Economic Research. That is a statistical average that would, however, have very different regional effects, Thiess Petersen of the Bertelsmann Foundation said. 'The US and Europe would benefit greatly. But there would be drawbacks for the rest of the world.'

'The rest of the world' means above all the emerging and developing countries in Asia, Africa and Latin America. But the TTIP could also adversely affect the traditional trade partners of the US and the EU, Petersen said. 'The most worrisome implications are for Canada and Mexico. As GDP per capita could contract seven to nine percent.'

The TTIP would negatively affect the North American Free Trade Agreement (NAFTA)that binds these two countries with the United States. And other trading partners such as Chile and Australia would be hit. 'And in Asia, too, virtually all countries would suffer a decline in growth, between 0.5 and 2.5 percent,' he said.

Two scenarios

At present, the TTIP negotiations are faltering. It is unlikely that the FTA will be passed within the next two years. Even so, it is becoming apparent that the impact on third countries will likely match one of two scenarios.

If the transatlantic trade agreement only eliminated customs duties, the impact on transatlantic trade relations would be relatively small because duties in most regions are already very low. The second variant would thus make more sense: reducing not only tariffs but also so-called non-tariff barriers to trade. These include food regulations and other standards for environmental and consumer protection.

They have ignited a conflict between the interests of European consumer advocates and development experts. The former want to cement their high EU standards in the TTIP. They aim to prevent, for example, non-labeled genetically modified foods going on the European market. 'If the partly lower US standards are implemented at the EU level, producers who previously exported to the US, but did not meet EU standards, would now be excluded from the US market,' Kubny said. 'Or they would have to bear substantial costs to adapt to the higher standards - if they are ever able.'

Free trade versus development policy

At present, new worldwide sustainable development goals are being negotiated to replace the UN Millennium Development Goals from 2016. They aim to eliminate worldwide hunger and extreme poverty by 2030. If the transatlantic free trade agreement should lead to a decline in per capita income in third countries by up to nine percent, then there is the question of policy coherence: how can the economic and commercial interests of the north agree with the development needs of the south?

The stated goal of German and European development cooperation is to strengthen the competitiveness of developing countries and to facilitate their participation in world trade. 'If it comes to the point that developing countries' market access to the US and the EU is hindered, this would thwart development cooperation efforts' Kubny said.

Doha by the back door?

Developing countries have almost brought World Trade Organization negotiations on a far-reaching liberalization of world trade to a standstill. Among other things, they oppose abolishing state aid in the food supply in the course of cutting subsidies. India is spearheading this movement. The dispute over patent protection on drugs represents another almost insurmountable obstacle. While the industrialized countries agree to only a very limited easing of patent protection, the southern countries want to manufacture and distribute essential medicines, such as for cancer and AIDS, even ignoring patent protection.

In this context, the Doha Round of trade talks is 'a catalyst for taking the interests of developing countries into account' Kubny said, since the developing countries sit at the negotiating table as equals. 'Some of the standards that developing countries torpedoed in the Doha Round, will be discussed again in the context of the TTIP. So they could now be introduced through the back door.'

Developing countries do not have direct influence on the TTIP negotiations. It would be desirable, but not realistic, for the EU and US to open their internal market to products from the south to compensate these countries for the drawbacks of the new trade bloc, Petersen said.

'An alternative would be for the regions that expected to lose out from this Agreement to pursue stronger integration.' Only regional alliances such as South America's Mercosur and the Asian free trade area between ASEAN countries and China could allow the countries of the south to challenge the TTIP.

An unwilling star: 20 years since Kurt Cobain’s death

'F**k you all; this is the last song of the evening,' Kurt Cobain said into the microphone. It was November 18, 1993, and Nirvana's legendary MTV Unplugged gig was being recorded. He was sitting on stage in a thick cardigan and with stringy blond hair. The singer looked weary, and he was coping with torturous stomach pains that even hard drugs didn't alleviate.

Ahead of the MTV concert, he had threatened to prevent its recording from going forward, and he'd picked a fight with fellow bandmate Dave Grohl, saying the drummer's playing was too loud. In short, the dress rehearsal was a catastrophe. A few hours later, the audience wouldn't have suspected a thing. The band harmonized and fooled around a bit between songs. Cobain lolled about on his swivel stool, making sarcastic jokes here and there.

But when he sang, he was unmistakably engrossed in the music. The concert went down in pop music history.

'I don't have a gun'

Five months later, Kurt Cobain was found dead after shooting himself with a shotgun. When his body was discovered two days after his suicide, drug paraphernalia were lying next to the corpse.

Just weeks ago, police investigators released new photos of the scene. Mike Ciesynski, a detective specializing in unsolved crimes, hoped the photos would help put an end to the various conspiracy and murder theories that have mounted in the two decades since Cobain's death. 'It's a suicide. This is a closed case,' Ciesynski told members of the press. In 1994, investigators came to the conclusion that Kurt Cobain took a large dose of heroin before he shot himself.

A point of bitter irony for many fans: One of Nirvana's greatest hits, 'Come As You Are,' includes repetitions of the line, 'And I swear that I don't have a gun.'

Music for Gen X

In some ways, Kurt Cobain's suicide spelled not just the end of Nirvana, but the end of grunge - the genre from Seattle that conquered the world of pop music and with which the maladjusted struck back at the garish commercialism of the 90s. Generation X found its idol in the highly emotional, despairing, fragile, and unruly Kurt Cobain. Nirvana's music was hard, wild and burned out - the perfect soundtrack to long hair, ripped jeans and lumberjack flannel. It issued a clear rejection of the 'love everyone' spirit of 90s techno and rave culture, embodied in Germany by Berlin's Love Parade festival.

The band's lyrics didn't delve into politics. Instead, grunge bands with loud guitars, heavy-hitting drums and raw vocals conjured up problems of the everyday in a world that had just been freed from nuclear fears and the Cold War. It was a world in which there suddenly appeared to be much less to demonstrate against.

Cobain developed his own form of protest, though: bitter sarcasm, particularly directed at his primary backers - a recording industry that he dismissed as capitalist pigs. He also didn't shy away from harsh words for his fans, even though they'd made him what he wanted to be from early on: a rock star.

Enduring anthem

In many ways, though, Kurt Cobain was not the revolutionary with an extended middle finger, as he is so often portrayed. It's an image even he seemed to be fond of. But his journals, published as a book in 2002, paint a different picture. Sketches, letters, shopping lists and other checklists can be found within the pages, but there's little to lead readers to believe they are getting a glimpse into one of the most important rock idols of the 90s.

His drug addiction was no secret among his friends and associates. He was hardly the only one in the grunge scene who had developed a heroin habit. But almost no one could get inside his head.

Fellow band members Krist Novoselic and Dave Grohl knew what was going on, however. Bored one day, Grohl wrote a song about the group's lead singer called 'A Friend of a Friend,' in which the lyrics go, 'He needs a quiet room / With a lock to keep him in … He's never been in love / But he knows just what love is / He says never mind / And no one speaks / He thinks he drinks too much / 'Cause when he tells his two best friends / 'I think I drink too much' / No one speaks.'

Months later, in September 1991, came the Nirvana album 'Nevermind,' which changed the world of rock music profoundly. The first track, 'Smells Like Teen Spirit,' remains an anthem into the present. 'Rolling Stone' named it one of the best songs of all time - on what the magazine has hailed as one of the best albums in pop music history.

Point of no return

Cobain found himself swamped with prizes, massive tours, TV appearances, publications, the follow-up hit album 'In Utero,' and, ultimately, the MTV Unplugged gig - a kind of accolade for creative greats in the music industry. The more success Nirvana found, the worse things got for Cobain. Between his rise to fame, the drugs and his stomach problems, it all proved too much. In February 1994, Nirvana went on tour in Europe, with their last concert slated for April 8 in Dublin. But on March 1, the band broke things off. They had their last show on stage together in Munich, where the 3,000 fans in attendance had no idea what things were like for the ailing frontman. Days later, he tried to take his own life with sleeping pills. His wife, Courtney Love, found him and he was revived at the hospital.

But by then, Cobain had already shut himself off from everything. Neither Nirvana's success, nor his friends in the band, nor his wife and young daughter had a real chance of stopping his suicide. In his last brief to Courtney Love, he wrote, 'You know I love you, I love Frances, I'm so sorry.… I don't know where I'm going, I just can't be here anymore.'

Brazilians believe victims deserved sexual assault, study finds

The results of a recent study in Brazil couldn't be clearer: 'Women who wear tight-fitting clothes deserve it when they are attacked,' and 'If women knew how to behave, there would be fewer rapes.'

Those were comments a majority of Brazilians said they could identify with, according to a study published at the end of last month by the Brazilian Institute for Applied Economic Research (IPEA). The survey polled 3,810 people between the ages of 18 and 50 with 58.5 percent agreeing with the first statement and 65 percent with the second.

The study's results came as a shock to the public as well as the polling agency. 'The results are frightening because they are based on an old patriarchal mentality,' said Rafael Osorio, director of socio-scientific studies at IPEA.

First India, then Brazil

The statements Brazilians agreed with largely mirror similar comments made in India after a number of gang rapes were reported in the media. A video created by the satire group 'All India Bakchod' addressing the brutal sex attacks titled 'It\'s Your Fault,' was clicked on 1.5 million times within the first week, a total that has now jumped to over 3.5 million clicks. In it, a woman cheerily describes all the ways women cause rape and reaches the conclusion 'No women, no rape' before telling viewers to 'Stop blaming the victim.'

Brazilians were concerned by the pervasive belief that victims of rape and sexual assault are the cause of the crimes committed against them. 'It is demotivating that despite significant progress when it comes to equality, patriarchal views are still widespread, ' Osorio said.

The study also showed that 69 percent of those surveyed said men should be the head of the family. Paradoxically to the study's other findings, the survey said 91 percent of people agreed that men who hit women belong in prison.

Guilt - but not for the guilty

The state-run IPEA research institute estimated that there are 527,000 cases of rape in Brazil each year. But despite tightening laws regarding domestic violence in 2006, only a tenth of the cases are brought to the authorities' attention.

The majority of rapes take place in a domestic environment and, according to IPEA 70 percent of rape victims who filed charges were under 18 years old. The majority of perpetrators were either direct family members or acquaintances.

It's not just the recent IPEA study showing that an increasing number of Brazilians is playing down sexual violence - reports of abuse have also flooded social media networks in Brazil. Thousands of men have publicly condoned sexual assault and have even used the networks to organize meetings where the intent is to sexually attack women traveling on public transportation.

Subway attacks

'There have always been attacks in busses and trains, but now there are videos about it posted on the Internet to excite men and instigate sexual harassment,' said Sonia Coelho of the NGO Sempreviva Organizacão Feminista. She said such a Facebook page with 12,000 fans was recently taken off the Internet.

Despite the increasing number of attacks, the number of sexual harassment charges filed with police in Sao Paulo is low. There were just 100 cases in 2013 and 29 in the first three months of 2014.

Unlike other Brazilian cities, such as Rio and Brasilia, Sao Paulo does not plan to introduce separate train subway cars for women. The city's subway system, which transports 7.4 million people daily, uses camera surveillance and undercover security personnel to protect passengers.

Coelho, however, said she was skeptical that separating male and female passengers would be of much use as it does not address the problem of rampant sexual abuse. 'Pink train cars only separate the sexes,' she said, adding that would do less to protect women than increase men's sense of machismo.

Musharraf survives assassination attempt as he returns home from hospital

Policemen inspect the site of a bomb explosion in Islamabad on April 3, 2014. The bomb was planted on Musharraf's route from an army hospital where he has been staying since January to his home on the outskirts of Islamabad. PHOTO: AFP

ISLAMABAD: Former president Pervez Musharraf narrowly escaped an assassination attempt as a bomb went off shortly before his convoy was due to pass early Thursday, police said.

The former military ruler was on his way to Chak Shahzad farmhouse from the Armed Forces Institute of Cardiology, where he has been staying since January 2, when the bomb went off.

Nobody was injured and there have so far been no claims of responsibility.

“Four kilogrammes of explosive material – planted in a pipeline under a bridge – exploded around 20 minutes before the former president was supposed to cross the spot,” senior police official Liaqat Niazi said.

The blast occurred at the Faizabad interchange, which lies at the boundary of the twin cities, and destroyed a footpath around two metres wide.

Niazi said the former president was then taken home via an alternative route.

Muhammad Naeem, a spokesman for the Islamabad police, confirmed the incident, saying a bomb disposal squad had cleared the area after the blast.

“Nobody was injured in the blast,” he said, adding Musharraf was the intended target.

On March 31, the Special Court had formally charged Musharraf for imposing emergency rule in the country in 2007. The former army chief had appeared before the three-judge bench and had rejected all charges against him.

Read about the five charges levelled against Musharraf here.

Explosives planted

This is the fifth time that explosive material was found from places close to either the former army chief’s accommodation or his travel route.

• On January 1, explosives with three electronic circuits and remote control were found on the route scheduled to be taken to Special Court by the former president. The police had said 1kg of explosives was planted near the Chak Shehzad traffic signal on Park Road.

•  On December 30, 2013 five packets each containing 0.5kg explosives were found near Musharraf’s farmhouse in the jurisdiction of the Bani Gala police station.

•  On December 24, the day Musharraf was to appear before a specially-constituted court that is hearing a treason trial against him, a five-kilo Improvised Explosive Device was found in a briefcase along the route the former dictator would have taken to reach the court. Musharraf failed to show up for that hearing citing security concerns. A detonator was also found in one of the packets, police said, citing the Bomb Disposal Squad which was called to the spot after police were alerted.

•  On April 23, 2013, an explosive-laden car was found outside the farmhouse. The police had claimed the car was meant to target the former president’s convoy on his return from an anti-terrorism court from Rawalpindi.

Hagel aims at Congress with 2015 Pentagon plan

The first Pentagon budget under the tenure of US Defense Secretary Chuck Hagel is 'an opening shot,' says Mark Gunzinger, a senior fellow at the Center for Strategic and Budgetary Assessments, a think tank specializing in US defense policy, planning and budgets.

That shot was aimed at a US Congress which had tied Hagel's hands. Budget wrangling generally, and the Bipartisan Budget Agreement of 2013 in particular, made cuts to the US military inevitable. The Pentagon in 2014 has $496 billion (360 billion euros) at its disposal, or '$31 billion below what the president requested,' Hagel noted during his speech.

No one, Gunzinger says, likes cuts to 'current readiness and modernization programs which will reduce future readiness.' The same members of Congress who forced Hagel to act, in other words, just don't want him to do so in a way which hurts their own districts or states or which weakens perceptions of US military might.

If Congress passes Hagel's plan in the future without providing supplemental funding, the 2015 Pentagon plan implies just that.

A Hagelian budget

The plan's most controversial aspect - that active-duty members of the armed services are to drop from 520,000 to between 440,000 and 450,000 - will, Hagel says, 'help ensure the Army remains well-trained and clearly superior in arms and equipment.' It's a statement which can be read in terms of Hagel's personal experience in war.

'Because he served as an infantryman - not an officer, he was right there in the trenches - he has a point of view other people don't have,' said Charlyne Berens, who has written the only biography to date on Chuck Hagel and is the current associate dean at the University of Nebraska-Lincoln's College of Journalism and Mass Communication.

Hagel served as an infantryman in Vietnam with his brother, making him the first US defense secretary in history to have been enlisted as a combat soldier.

Rather than coming up with something that that sounds 'lovely politically,' she told DW, he tends to opt for battleground preparedness.

'He told me that when he was in the Senate, and they'd be considering any kind of military legislation, he'd say, 'We have to understand that these are real people we're talking about and real lives that are being affected. It's not some textbook, sanitized version of conflict. It has real consequences.''

Europe to the rescue?

According to Gunzinger, 'There are some hints in Hagel's announcement that the Defense Department is serious about pursuing new technologies such as unmanned systems and cyber capabilities.' He also hopes to see the department expand in its upcoming Quadrennial Defense Review report on what he calls its 'crown jewels:' special operations forces, cyber and space capabilities, long-range stealth strike systems, underseas warfare and directed energy weapons such as high-powered lasers.

Hagel will likely also prioritize a military rebalance in the Asia-Pacific region and a stable military posture in the Middle East.

And while the US is urging Europe to modernize its military capabilities and prepare to contribute more in out-of-region contingency operations, it is not a question of Europe simply filling in the gap in the future, Gunzinger says.

'I don't see the US military reducing their planned investments in the hope that Europe will play a larger role in maintaining stability in critical regions such as the Middle East and western Pacific.