Goldman Sachs buys into Turkish Petkim’s Aegean port


Hurriyet Daily News by Izmir

July 20, 2014

U.S. multinational investment banking company Goldman Sachs has become a partner in Turkey’s largest integrated port, operated by petrochemicals maker Petkim, in a deal that will boost the company’s plans to develop the port to make it largest of Aegean region.

Petkim has announced that it has reached a preliminary agreement to sell its 30 percent stakes in Petkim Limancılık (Petlim) for $250 million, after months of talks that started in February this year.

Petkim and Petlim are controlled by the Turkish branch of Azeri energy giant Socar. Petlim was founded to deal with the economic operation of Petkim’s port in the Aliağa district of the Aegean province of İzmir.

“One of the world’s biggest investors becoming a partner to our port company means approval of the value and economy of our project,” Socar Turkey President Kenan Yavuz said, speaking after a ceremony to mark the signing of the deal as well as a preliminary financing agreement with Turkish lender Akbank for the port project.

“We have signed a preliminary agreement for our port investment’s project financing with one of Turkey’s largest banks Akbank. We will secure $211 million in financing with a 13 year maturity within the term-sheet,” Yavuz said.

“We’re very glad to realize the share transfer deal with a global giant such as Goldman Sachs and the project financing agreement with Akbank on the same day,” he added.

The investment, which will become Turkey’s third container port, will become operational in the last quarter of 2015, Yavuz also said.

The Petkim Container Port, which for the first time in Turkey will enable the berthing of ships with 11,000 TEUs, will possess a starting capacity of 1.5 million TEUs. A logistic field with a total of 48 hectares will be created, with 42 hectares in the port field for container storage and 6 hectares in the rear service area. 

Socar Turkey also plans to build a refinery on the Petkim Peninsula with the aim of integrating refinery, petrochemical and logistical operations at the site.

The company is building the $5.5 billion Star refinery in partnership with Turcas Petrol to supply feedstock to Petkim and cut Turkey’s dependence on imported refined products.

Socar Turkey signed a $3.3 billion credit deal for the refinery in June, marking Turkey’s largest and longest-term financing deal for its first privately built oil refinery.

Nigeria expects economy to grow by at least 6.2 pct in 2014


Reuters by Chijioke Ohuocha

July 15, 2014

(Reuters) – Nigeria forecasts its economy will grow by at least 6.2 percent this year following a solid first-quarter performance, the statistics office said on Tuesday.

That would be faster than growth last year, which was revised down to 5.5 percent last week.

Nigeria overtook South Africa as Africa’s largest economy in April, after a rebasing of its calculation almost doubled its gross domestic product to more than $500 billion.

In the first quarter of 2014, the Nigerian economy also expanded by 6.2 percent from a year earlier, driven by its services sector, which offset a drop in oil production, the statistics office said on Tuesday.

“The first quarter is always the quarter with the slowest growth … because it’s the beginning of the planting season and consumers tend to spend less,” Director General of the National Bureau of Statistics, Yemi Kale, told Reuters.

The first-quarter performance was slightly slower than a 6.8 percent annual expansion in the final three months of 2013.

The services sector, which accounts for half of GDP, expanded by 7.2 percent in January-March from a year earlier, decelerating from an 8.7 percent rise in the previous quarter.

Crude production fell to 2.26 million barrels a day in the first quarter, from 2.29 million barrels per day a year ago, due to pipeline shutdowns and oil theft.

Most governments overhaul GDP calculations every few years to reflect changes in output, but Nigeria had not done so since 1990, so sectors such as e-commerce, mobile phones and its prolific “Nollywood” film industry, had to be factored in. 

Uncertainty for Indonesia after disputed vote


Yahoo News by Sam Reeves

July 12, 2014

Jakarta (AFP) – Indonesia faces a long period of uncertainty after last week’s disputed presidential election, analysts warn — raising fears for Southeast Asia’s top economy as growth sits at four-year lows, foreign investment slows and corruption remains rife.

After a bitterly-fought campaign, Jakarta governor Joko Widodo and his rival, ex-general Prabowo Subianto, both used different unofficial tallies to claim they had won on Wednesday.

Most credible counts showed Widodo in the lead, sparking a rally in stocks and the rupiah Thursday on the expectation that he will be declared the winner when official results are announced later this month.

But the initial euphoria quickly wore off. The Jakarta stock market slumped as much as two percent the following day, and was 1.3 percent down at the close as investors grew nervous about the potential for a prolonged deadlock.

“Given the conspicuous absence of a concession, the market still cannot rid itself of the spectre of draggy uncertainty for a while more,” said economist Wellian Wiranto, from Singapore’s OCBC Bank.

Investors favour Widodo, known by his nickname Jokowi, as he is seen as a potential reformer and a clean leader in one of the world’s most corrupt countries.

Prabowo, a top military figure in the era of dictator Suharto, has struck a fiercely nationalistic tone on the campaign trail, and is looked at warily by markets.

- Fears of violence -

The election commission is expected to announce the official results on July 22 but the loser may contest them in the Constitutional Court, which has until the end of August to make a ruling.

It is not a good time for Indonesia to be hit by uncertainty that could scare off investors, as it undergoes a painful transition from a decade of rapid growth fuelled by high global prices for its abundant commodities.

Falling commodity prices, as well as a series of protectionist policies, have hit the economy, which expanded at 5.21 percent in the first quarter — its slowest pace since late 2009.

Foreign investment has also slowed steeply, with investors wary of the uncertain business environment. Corruption, seen as a major obstacle to operating in Indonesia, remains rampant.

The political uncertainty caused by the election deadlock can only add to the gloomy picture, observers warn.

The Jakarta Post newspaper, which has backed Widodo, warned in an editorial that taking the battle all the way to the Constitutional Court “would prolong the political stalemate and uncertainty until late August”.

“The prospect of violence would dramatically increase unless leaders of political parties work to control their bases of support. The market would roil in response to these destabilising developments,” it said.

Indonesia was rocked by violence before the downfall of Suharto in 1998 following his three-decade dictatorship, with many killed in the capital Jakarta during rioting and looting.

The country has enjoyed a decade of relative peace and stability under the presidency of Susilo Bambang Yudhoyono, helping to transform it into one of the world’s fastest-growing economies and a major investment destination.

But fears are growing that the rising political tensions could spark fresh unrest, and Yudhoyono has called on both sides to restrain their supporters.

Analysts warn that the uncertainty could also hit domestic demand in the rapidly growing middle class, a key driver of growth in recent years.

“A disputed result will not just have market implications, but also likely a dampening impact on sentiment,” said Australia’s ANZ Bank in a note.

“A Jokowi presidency is likely to be aligned with more optimistic consumers whereas a Prabowo challenge could dampen sentiment and spending.”

Investors are hopeful for a quick end to the stalemate, with Widodo being declared the official winner later this month and Prabowo graciously conceding defeat.

But it is still far from clear how the crisis will play out, and most analysts think it is likely that Prabowo — who has been seeking the presidency for the past decade — will challenge the result in court if he loses.

“As much as the market is hopeful that the political drama has ended, we note that there are still alternative final episode scripts that cannot be totally ruled out,” said OCBC’s Wiranto.

ARM to launch Nigeria’s first infrastructure fund with $250 million


Reuters Africa By Chijioke Ohuocha

July 9, 2014

Men work on a train track at the National Arts Theatre stop of the light rail system under construction in Lagos, Nigeria, May 30, 2014.   REUTERS/Joe Penney

LAGOS (Reuters) – Nigeria’s ARM Infrastructure is close to raising $250 million in the country’s first infrastructure fund, to invest in transport, energy and utility sectors across West Africa, with much of the money coming from pension funds, its managing director said.

ARM said the fund was expected to close by mid-August and was at the documentation stage with various investors including some Nigerian pension funds and other institutional investors such as the African Development Bank, Opuiyo Oforiokuma said.

Nigeria, Africa’s most populous nation and home to 170 million people, requires around $50 billion a year for the next decade to develop badly needed infrastructure, especially for power, roads and water, to help boost economic growth.

Nigeria’s pension assets have grown to $25 billion in 2014, from under $4 billion seven years ago, as the government targets schemes to try to encourage domestic savings. But the funds have traditionally invested in debt and equity portfolios.

“We are setting up a new infrastructure fund … (The) target fund size is $250 million. This will be the first time pension funds are actually going to invest in infrastructure,” Oforiokuma said on the sidelines of a pension funds conference in Abuja.

ARM is a financial services firm with interests in real estate, insurance and capital markets. It developed Nigeria’s first toll road under a private-public partnership in the commercial hub of Lagos.

The fund will target equity stakes in airport and sea port projects across West Africa, and invest for a period of 12 years, targeting investment returns of 18-20 percent over the period.

“We don’t have basic roads, power supply and water. All of these have significant consequences for the economy, the social well being (of Nigeria),” Oforiokuma said, adding that Nigeria generates around 4,000 megawatts of electricity, compared with Brazil, which generates 100,000 megawatts.


World Bank launches $8billion CPS for Nigeria


Nigerian Tribune by Gbola Subair

July 8, 2014

The launching event aims to make the objectives and outcomes of the strategy known to all beneficiaries, namely the federal and state government officials, the MDAs (federal and state), media, Civil Society Organizations (CSOs), the private sector, academics, researchers, professionals and other stakeholders.

The new strategy’s endorsement comes at an opportune time, just as Nigeria is redoubling its efforts to tackle critical development challenges and is committing itself to lift major constraints that are hindering it from achieving broad-based, inclusive economic growth and poverty reduction goals, analysts said.

The new partnership strategy, jointly developed with the government of Nigeria, would support the country’s Vision 20: 2020 plan and its transformation agenda; which set out Nigeria’s long-term development objectives and the medium-term strategy for operating the vision, sources said.

The strategy includes support for a bold and ambitious program of development targets and interventions for the next four years.

According to the Coordinating Minister for the Economy and Minster of Finance, Ngozi Okonjo Iweala, “the Country Partnership Strategy is very commendable and in line with the Transformation Agenda of the Federal Government. It supports our development objective.”

Marie Francoise Marie-Nelly, World Bank Country Director for Nigeria, also said “the new strategy is a joint product, developed in close consultation with the Government of Nigeria and stakeholders under the Country Assistance Framework, a strategic platform developed by Nigeria’s partners to coordinate interventions and leverage resources to deliver strong results and development solutions,” said. “It reflects Nigeria’s development aspirations and commits the World Bank Group to working hand-in-hand to unleash Nigeria’s potential for the benefit of all Nigerians.”

Nigeria Has Biggest African Growth Potential for Microsoft


ITWeb Africa by Simnikiwe Mzekandaba

July 2, 2014

Nigeria holds the key for Microsoft’s future growth in Africa, according to the company’s former South African managing director Mteto Nyati.

Nyati made this statement at a media briefing on Tuesday, when he announced his promotion as the general manager for Microsoft’s Middle East and Africa (MEA) emerging regions.

For the past six years, Nyati led Microsoft South Africa as the unit’s managing director. His promotion to an emerging region role means that is expected to oversee countries such as Nigeria, Bahrain, Iraq, Libya, Tunisia, Lebanon and Jordan.

At the briefing, Nyati explained that Microsoft expects its African business to double in size over the next four to five years, but he declined to disclose current revenues.

“Nigeria being a country that has the biggest potential for us,” said Nyati.

Nigeria has come more sharply into Microsoft’s focus this year.

The software giant has appointed South African IT veteran Kabelo Makwane as Microsoft Nigeria country manager.

Meanwhile, Nigeria has this month joined South Africa and Egypt in being self-sufficient business units that manage their own resources.

South Africa; though, is Microsoft’s biggest business unit on the continent.

Earlier this year, Makwane told ITWeb Africa that Nigerian revenues are six times smaller than that of the South African office.

But Nigeria has a booming economy that has recorded over 6% annual growth over the last five years, and a population that surpasses 160 million people.

Nigeria also overtook South Africa this year as the continent’s biggest economy owing to a gross domestic product (GDP) recalculation.

More broadly speaking, Microsoft doesn’t have a physical presence in all 35 countries in the MEA region.

However, that could change, Nyati said.

“We are looking for growth, we are looking at making investments in these areas and looking at helping country leaders of these territories to drive growth for the Microsoft corporation.

“Our view about these countries is that we are seeing the opportunities in the long term, ” he said.

Nyati also announced that the South African operations is being led by the company’s former chief operating officer, Zoaib Hoosen.

Hoosen has been with Microsoft SA for the past three years.

Going forward Microsoft SA intends focus on skills and entrepreneurship to create jobs, affordable access and devices, Hoosen told the audience.

“I am really excited about the potential and through this how we will be able to create jobs and really enable South Africa to drive our economic development and become more globally competitive. I look forward to the new challenge,” he said.

Turkey rejects Kurdish independence, wants Iraq unity government, officials say


Reuters by Johnny Hogg and Orhan Coskun

June 30, 2014

(Reuters) - Turkey opposes independence for a Kurdish state in northern Iraq and wants a unity government in Baghdad to counter the threat by Islamist Sunni rebels who have seized large swathes of territory in recent weeks, Turkish officials said.

Iraqi Kurds have benefited from the recent turmoil sweeping the country by occupying territory abandoned by government forces fleeing the advance of Sunni fighters led by the Islamic State in Iraq and the Levant (ISIL), which took Iraq’s second city Mosul earlier this month.

Turkey has good relations with the semi-autonomous Kurdish Regional Government (KRG) in Iraq but would not support moves to push for independence from Baghdad, a Turkish government official said in response to questions from Reuters on Monday.

“Turkey’s position is for the territorial integrity and political unity of Iraq, that’s it,” the official said anonymously, in order to speak more freely.

“(We) are not in favor of any independence, that would be detrimental to that unity. Nothing like that could be discussed,” the official stated, adding that Ankara is backing calls for the creation of a consensus or unity government to represent the interests of all Iraqis.

There has been mounting speculation over the past few weeks that Ankara’s poor relations with the central Shi’ite-led government of Iraqi Prime Minister Nuri al-Maliki could lead to Turkey accepting or supporting a Kurdish breakaway from Baghdad.

Comments in the Financial Times on Saturday by Huseyin Celik, a spokesman for Turkey’s ruling AK Party, have been interpreted as suggesting Ankara would tolerate an independent Kurdish state if Iraq were to fall apart.

“If Iraq is divided and it is inevitable, they are our brothers… Unfortunately the situation in Iraq is not good, and it looks like it is going to be divided,” Celik was quoted as saying.

However another Turkish official at the prime minister’s office last week appeared to pour cold water on the idea, telling Reuters that “the integrity of Iraq is very important to Turkey”.

Turkey has in the past been cool to efforts for greater autonomy for Iraqi Kurdistan for fear of stirring up separatist feelings among its own Kurds, who fought a decades-long insurgency in which an estimated 40,000 people were killed.

Peace talks led to a cease-fire in that conflict last year.

This year, Turkey allowed Iraqi Kurds to pipe oil to export for the first time, pumping it to a Turkish port over Baghdad’s objections.

The first tankers of Kurdish oil were bought in recent weeks by Israel, whose Prime Minister Benjamin Netanyahu voiced support for Kurdish statehood on Sunday, taking a position that appeared to clash with the U.S. preference to keep Iraq united.

The Kurds have seized on the recent sectarian chaos in Iraq to expand their autonomous northern territory to include Kirkuk, a city they consider their ancestral capital, perched on vast oil deposits that could support an independent state.

Kurdish officials say the ISIL advance has transformed Iraq, requiring a renegotiation of the settlement in place since the fall of Saddam Hussein in 2003, under which they rule themselves but remain within Iraq in return for a fixed percentage of its overall oil revenue.

Iraq’s five million Kurds have ethnic compatriots in Iran, Syria and Turkey, and have so far hesitated to declare full independence, in part to avoid angering neighboring countries.

Turkey has in recent years pursued deeper ties with Iraqi Kurds, partnering up in the exploration and production of oil fields in Iraqi Kurdistan and signing multi-billion dollar oil and gas deals last November.