Agility sees growth in Egypt and Tunisia

Updated 14 September 2012
0

Agility sees growth in Egypt and Tunisia

KUWAIT CITY: Kuwaiti logistics firm Agility says it is gearing up for expansion in emerging markets, much of it in countries that experienced Arab Spring political upheavals as new governments there spend more on their oil industries and infrastructure.
The group was the largest supplier to the US Army in the Middle East during the war in Iraq, but is changing tack and putting less emphasis on defense services, Chairman and Managing Director Tarek Sultan said.
He said the company was in talks with the new governments in Egypt, Tunisia and Libya on increasing its presence and investments.
“You think of Libya, you think of oil and gas and infrastructure, including roads, ports, warehouses,” Sultan said. “In Egypt there is a consumer market, there are some oil and gas activities, normal freight forwarding, warehousing and there is a lot in real estate.”
Agility’s strategy shift is not just down to confidence in these growth markets. The group is barred from bidding for new US government business, pending the outcome of a legal dispute with the US, and pleaded not guilty in August last year to charges it defrauded the US government over multi-billion dollar supply contracts.
However, its Kuwait-listed shares have climbed 24 percent since the end of last year, hitting their highest level for 20 months. Global Investment House, a local brokerage, said interest in the stock had been boosted by investors’ hopes that Agility would win a claim filed against the US Defense Logistics Agency (DLA).
Agility filed a $ 225 million claim against the DLA in April, saying the agency had breached the terms of a contract for food distribution to combat units.


In future, the company is likely to be less vulnerable to large-scale disputes with governments.
“In practice now all of our revenues are basically commercial revenues. So we do have some government work (but) it is limited — in general we are focused on commercial customers,” Sultan said.
Agility, the largest Gulf Arab logistics company, expects new governments in the region, under pressure to reduce unemployment, to introduce policy changes that produce more private-sector jobs and reduce red tape.
“In the short term, decision-makers will obviously focus on things other than business, but at the same time the signs that we are seeing out of Egypt ... are positive and I think the government is saying the right things and starting to do the right things,” Sultan said.
“So hopefully we will be able to have a very positive dialogue with governments once the dust has settled, and they get to turn their attention to the task of creating jobs and opportunity for their constituents.”
Agility, which is present in more than 100 countries, sees opportunities created by the Arab Spring as part of a trend toward emerging market business, beyond more developed economies in the West and the Gulf.
“There is some kind of shift in focus toward emerging markets. Countries including India, China, Brazil, Australia, Pakistan and the Middle East make up almost 60 percent of our revenues. This percentage will increase naturally,” Sultan said.
The group in July won a two-year contract worth $ 238 million to supply logistics support to the Gorgon natural gas project in Australia. It also obtained a two-year extension of an existing contract with Gorgon worth $ 262 million.
Agility last month posted a profit of 7.82 million dinars ($ 27.7 million) for the three months to June 30, against 7.83 million in the year-ago period.


Urgency needed to boost Palestinian economy: IMF chief

Updated 26 June 2019
0

Urgency needed to boost Palestinian economy: IMF chief

  • The MF has been warning of severe deterioration in the Palestinian economy
  • ‘If there is an economic plan, if there is urgency, it’s a question of making sure that the momentum is sustained’

MANAMA: IMF chief Christine Lagarde said Wednesday that major economic growth was possible in the Palestinian territories if all sides showed urgency, as she took part in a US-led conference boycotted by the Palestinian leadership.
The International Monetary Fund has been warning of severe deterioration in the Palestinian economy, with tax revenue blocked in a dispute with Israel which has also imposed a crippling blockade on the Gaza Strip for more than a decade.
“If there is an economic plan, if there is urgency, it’s a question of making sure that the momentum is sustained,” said Lagarde.
The IMF chief is attending a conference in Bahrain to discuss the economic aspects of a United States plan for Israeli-Palestinian peace, which has already been rejected by the Palestinians as it fails to address key political issues.
Lagarde said for the US plan to work “it will require all the goodwill in the world on the part of all parties — private sector, public sector, international organizations and the parties on the ground and their neighbors.”
Citing examples of post-conflict countries, Lagarde said that private investors needed progress in several sectors including strengthening the central bank, better managing public finance and mobilizing domestic revenue.
“If anti-corruption is really one of the imperatives of the authorities — as it was in Rwanda, for instance — then things can really take off,” she said.
The plan presented by White House adviser Jared Kushner calls for $50 billion of investment in the Palestinian territories and its neighbors within a decade.
The proposals for infrastructure, tourism, education and more aim to create one million Palestinian jobs.
Gross domestic product in the Gaza Strip declined by eight percent last year, while there was only minor growth in the West Bank.
Kushner, opening the conference on Tuesday, called the plan the “Opportunity of the Century” — and said the Palestinians needed to accept it before a deal can be reached on political solutions.
The Palestinian Authority has rejected the conference, saying that the US and Israel are trying to dangle money to impose their ideas on a political settlement.
Washington says it will unveil the political aspects of its peace deal at a later date, most likely after Israel’s September election.