‘With luck and pixie dust, you might find a gem’: Bahrain revives its pearl industry

Special ‘With luck and pixie dust, you might find a gem’: Bahrain revives its pearl industry
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Updated 09 December 2021

‘With luck and pixie dust, you might find a gem’: Bahrain revives its pearl industry

‘With luck and pixie dust, you might find a gem’: Bahrain revives its pearl industry

Bahrain has revived its age-old pearl industry as it looks to other sources of revenue to diversify its oil economy.

The Bahrain Institute for Pearls and Gemstones recently announced that it has examined over 10 million pearls from all over the world since it was established in 2017. It said its commercial laboratory has become a global authority on the verification of these stones.

The institute is owned by the kingdom’s sovereign wealth fund Mumtalakat, and run by CEO Noora Jamsheer, who noted the world is seeing growing demand for these gems.

She told Arab News: “The reason we’re seeing an increase in natural pearls is due to the growing global demand for items with rarity value. And that rarity is being maintained by the government of Bahrain.”

Jamsheer noted that there is greater demand for natural pearls as opposed to the cultured variety.

Cultured pearls are artificially produced by inserting a tiny piece of mother-of-pearl into a live oyster shell, but Jamsheer said the result produces an almost “too perfect” stone that is only 20 percent natural, with the core made from inferior material.

But the beauty of 100 percent natural pearls are their subtle imperfections and incomparable luster, which have been prized for thousands of years, she said.

 

Pearls have a storied modern history. A high-water mark came around 1915, when an especially fine pearl was found to be worth four times a diamond of the same weight.

The following year the famous French jeweler Cartier bought its New York showroom by exchanging two strings of pearls for a Fifth Avenue building — a deal worth some $1.5 million at the time.

But only a few years later those same strings of pearls were valued at only $140,000, as the natural pearl market declined due to a combination of factors including the Great Depression and the demise of the imperial families of Europe and the maharajas of India, who prized the stone.

As demand for natural pearls fell, the artificial cultivation of pearls grew more sophisticated and came to dominate the market.

Meanwhile, Bahrain, which has always had an established pearl industry, increasingly became an oil-based economy after crude was discovered in the kingdom in the 1930s. Severe restrictions were imposed on the extraction of pearls, which kept a lid on the sector for decades.

Jamsheer pointed out that the kingdom has a wide-ranging plan to boost the pearl business.

This includes using the institute to regulate new pearls by developing its gem laboratory, and protecting the country’s offshore pearl beds, which are larger than the whole of Bahrain.

The body also works to preserve the heritage of the industry and strengthen the kingdom’s position as a global center for the trade in natural pearls.

The Pearl Diver monument in the Bahrain National Museum (Shutterstock)

Jamsheer pointed out that pearls continue to be sourced by divers, as they have since the beginning of the industry, but they now use oxygen tanks making the job less dangerous.

She said some 800 Bahrainis have been awarded a license to dive for pearls, after completing a course covering extraction techniques and regulatory issues.

The global market for natural pearls is valued at between $100 million and $150 million a year, according to a report by consultants McKinsey, a sector dominated by Bahrain.

The value of a pearl can vary dramatically depending on factors such as type, size, color and surface quality — but in general they range from $200 to over $100,000, according to UK firm The Pearl Source.

Jamsheer said the market for natural pearls is driven by two major factors: The growing demand for ultra-luxury items with great rarity, and the fact that natural pearls are sourced in sustainable conditions that are not tainted by conflict, unlike gold and diamonds, which can often be associated with civil war, child labor and oppressive regimes.

Before joining the institute, Jamsheer worked with the UN Security Council as an expert in natural resources.

She said: “I visited West Africa and monitored natural resources there, and when I came into the pearl sector, I thought I would be seeing something similar to gold and diamond production.

“But it was completely different because this material is made by nature, which doesn’t need to be cut and polished. It’s remarkable because there’s never been any conflict associated with natural pearls, unlike with other gemstones.”

Jamsheer pointed out that tourists to the kingdom are also allowed to dive for pearls.

She said: “As a tourist, you have a quota of 60 oysters, and you get to keep whatever you find. So with a bit of luck and some pixie dust, you never know, you might find a gem.”


US economy contracts in first quarter; outlook fuzzy

US economy contracts in first quarter; outlook fuzzy
Updated 30 June 2022

US economy contracts in first quarter; outlook fuzzy

US economy contracts in first quarter; outlook fuzzy
  • Gross domestic product fell at a 1.6 percent annualized rate last quarter

WASHINGTON: The US economy contracted slightly more than previously estimated in the first quarter amid a record trade deficit and supply chain disruptions, government data showed on Wednesday.

The Commerce Department’s third estimate of gross domestic product also showed some under- lying softness in the economy, with consumer spending revised lower and inventories higher than reported last month. This does not bode well for domestic demand and the economic outlook amid recession jitters as the Federal Reserve aggressively tightens monetary policy to tame inflation.

“The biggest effect from this report is that it leaves inventories in a more overbuilt position than previously thought, putting second quarter GDP into negative territory pending what tomorrow’s data reveal about May consumption and consumer inflation and April revisions to the same,” said Chris Low, chief economist at FHN Financial in New York.

Gross domestic product fell at a 1.6 percent annualized rate last quarter, revised down from the 1.5 percent pace of decline reported last month. Economists polled by Reuters had forecast the pace of contraction would be unrevised at a 1.5 percent rate.

The economy was initially estimated to have contracted at a 1.4 percent rate. It grew at a robust 6.9 percent pace in the fourth quarter. GDP was 2.7 percent above its level in the fourth quarter of 2019.

Consumer spending, which accounts for more than two-thirds of the economy, grew at a 1.8 percent rate instead of the 3.1 percent pace reported last month. The downgrade reflected downward revisions to financial services and insurance as well as healthcare.

Spending on long-lasting goods like motor vehicles and recreational goods was revised lower.

Businesses accumulated inventories at a $188.5 billion rate, rather than the $149.6 billion rate reported last month. As a result, growth in final sales to private domestic purchasers, which excludes trade, inventories and government spending, was revised down to a 3 percent rate last quarter. This measure of domestic demand was previously reported to have risen at a 3.9 percent rate.


Saudi Cabinet approves new companies law to drive entrepreneurship

Saudi Cabinet approves new companies law to drive entrepreneurship
Updated 30 June 2022

Saudi Cabinet approves new companies law to drive entrepreneurship

Saudi Cabinet approves new companies law to drive entrepreneurship
  • New legislation to regulate all provisions related to companies, whether commercial, nonprofit or professional

RIYADH: The Saudi Cabinet has approved a law allowing the creation of a new type of company in the Kingdom to boost entrepreneurship.

The new Companies law was signed off on Tuesday, and will regulate all provisions related to companies, whether commercial, non-profit or professional.

It allows a new form of company — called a Simplified Joint Stock Company — that meets the needs of entrepreneurship and venture capital growth.

It also allows the issuance of a family charter that regulates ownership in family businesses, in addition to governance, management, work policy, employment of family members and cash profits to ensure the sustainability of these companies.

“The new law will improve the financing and business dynamics in every sector in the economy, it should have a great positive impact on the economy for the next decades,” CEO of Razeen Capital, Mohammed Al Suwayed, told Arab News.

 “I can't point out a single impact because the impact is going to be happening in all of the sectors gradually,” he said.

It also reduces the legal requirements and procedures for small and medium enterprises, and simplifies the procedures for establishing companies.

Under this law, many restrictions in the incorporation, practice and exit phases and restrictions on company names have been removed.

According to the Ministry of Investment, the changes will also enhance the diversity and strength of the local market, and raise the level of competitiveness of the Saudi investment environment.

“The new corporate system came to achieve the hopes of family businesses, organize their business by concluding the family charter, encourage bold investment and address the challenges of entrepreneurs by approving the simplified joint stock company,” the Minister of Commerce Majid Al-Kassabi said. 

Real Estate Brokerage law

Another law signed off was the Real Estate Brokerage law, which aims to regulate the brokers business and provide innovative and high-quality services to beneficiaries.

“The Saudi Cabinet’s ratification of the real estate brokerage law will help ensure the reliability of real estate transactions through the Real estate General Authority,” Majid Al-Hogail, Minister of Municipal, Rural Affairs and Housing said on Twitter.

He added that It will also help raise the level of services provided and preserve the rights of customers in the sector through standards and procedures for doing business.

Al-Hogail indicated that real estate brokerage services are limited to brokers licensed by the General Real Estate Authority, and brokerage contracts and real estate transactions must be submitted electronically.

He said the commission and prepayment must be determined, and that violators will be subject to penalties under the law.

Abdullah Al-Hammad, CEO of the Real Estate General Authority, described the law as a “positive addition.”

“This law complements the legislative system that the General Real Estate Authority is working on to regulate the real estate market in the Kingdom of Saudi Arabia,” he told CNBC.  

The new corporate system will play a pivotal role in supporting and strengthening the regulatory environment for commercial and economic entities, the chairman of the Capital Market Authority said. 

The system aims to facilitate the procedures and regulatory requirements to stimulate the business environment and support investment, Mohammed Elkuwaiz added. 

Decoder

Saudi Arabia’s new Companies law

Approved by the Saudi Cabinet on June 28, 2022, the measure allows a new form of company — called a Simplified Joint Stock Company — that meets the needs of entrepreneurship and venture capital growth. It reduces the legal requirements and procedures for small and medium enterprises, and simplifies the procedures for establishing companies. Many restrictions in the incorporation, practice and exit phases and restrictions on company names have been removed.


Biden administration holding its first onshore oil sales

Biden administration holding its first onshore oil sales
Updated 29 June 2022

Biden administration holding its first onshore oil sales

Biden administration holding its first onshore oil sales

BILLINGS: The US government this week is holding its first onshore oil and gas drilling lease auctions since President Joe Biden took office after a federal court blocked the administration’s attempt to suspend such sales because of climate change worries.

The online auctions start on Wednesday and will conclude on Thursday. About 200 square miles (518 square kilometers) of federal lands were offered for lease in eight western states. Most of the parcels are in Wyoming.

The sales come as federal officials try to balance efforts to fight climate change against pressure to bring down high gas prices.

Republicans want Biden to expand US crude production. But he faces calls from within his own party to do more to curb fossil fuel emissions that are heating the planet.

A coalition of 10 environmental groups said in a lawsuit filed before the sales even began that they were illegal because officials acknowledged the climate change impacts but proceeded anyway.

An immediate ruling was not expected. Interior Department spokesperson Melissa Schwartz said the agency did not have comment on the litigation.

Beginning with this week’s sales the royalty rate for oil produced from new federal leases is increasing to 18.75 percent from 12.5 percent. That’s a 50 percent jump and marks the first increase since the 1920s.

Parcels also are being offered in Colorado, Utah, New Mexico, Montana, Nevada, North Dakota and Oklahoma.

Hundreds of parcels of public land that companies nominated for leasing had been previously dropped by the administration because of concerns over wildlife being harmed by drilling rigs. More parcels covering about 49 square kilometers were dropped at the last minute in Wyoming because of potential impacts on wilderness, officials said.

But attorney Melissa Hornbein with the Western Environmental Law Center said the reductions in the size of the sales were not enough.

“They are hoping that by choosing to hold sales on a smaller amount of acreage they are threading the needle. But from our perspective, the climate science is the one thing that doesn't lie,” Hornbein said.

Fossil fuels extracted from public lands account for about 20 percent of energy-related US greenhouse gas emissions, making them a prime target for climate activists who want to shut down leasing.

Biden suspended new leasing just a week after taking office in January 2021. A federal judge in Louisiana ordered the sales to resume, saying Interior officials had offered no “rational explanation” for canceling them and only Congress could do so.

The government held an offshore lease auction in the Gulf of Mexico in November, although a court later blocked that sale before the leases were issued.


Arabian Plastic Industrial Co. gets CMA nod to IPO 20% stake on Nomu

Arabian Plastic Industrial Co. gets CMA nod to IPO 20% stake on Nomu
Updated 29 June 2022

Arabian Plastic Industrial Co. gets CMA nod to IPO 20% stake on Nomu

Arabian Plastic Industrial Co. gets CMA nod to IPO 20% stake on Nomu

RIYADH: Saudi-based Arabian Plastic Industrial Co. has received approval for an initial public offering of 1 million shares on the Kingdom’s parallel market.

Shares to be listed represent 20 percent of the company’s share capital. 

The resolution was issued by the Saudi stock market regulator Capital Market Authority in a statement on Wednesday.

The Capital Market Authority’s approval shall be valid for six months from the authority’s board resolution date. It shall be deemed cancelled if the company’s offering is not completed within this period. 

The authority also granted Abdulaziz and Mansour Ibrahim Albabtin Co. approval to list 544,000 shares, representing 16 percent of the firm’s capital, on Nomu.

 

 


Arabian Drilling Co. gets approval to IPO 30% stake on Saudi stock market

Arabian Drilling Co. gets approval to IPO 30% stake on Saudi stock market
Updated 29 June 2022

Arabian Drilling Co. gets approval to IPO 30% stake on Saudi stock market

Arabian Drilling Co. gets approval to IPO 30% stake on Saudi stock market

RIYADH: Saudi-based Arabian Drilling Co. has received approval for an initial public offering of 26.7 million shares, representing 30 percent of the firm’s capital, on the Kingdom’s stock exchange.

The Capital Market Authority’s approval shall be valid for six months from the authority’s board resolution date. It shall be deemed cancelled if the company’s offering is not completed within this period.