Qatar on the way to Sardinia

The reconversion of the economy of the Emirate from a system grounded on the revenues of natural energy export  to a modern sustainable macroeconomic model passes through a wide range of foreign investments.

After taking stakes in different  sectors, making investments from Harrod’s to Valentino, the small and wealthy country is searching new targets to expand Qatari influence. The rumors of a purchase of a percentage of about 49% of the stake of Meridiana, a small Italian airline based in Olbia, a tourist location in the island of Sardinia, by the Qatar Airways, the company owned by the State of Qatar, have become louder during last days. According to Italian newspaper La Repubblica,  the Gulf carrier is not supposed to be directly involved in the purchase, while IAG, a larger company born by the merger between British Airways and Iberia, will actually do the operation.

This move of Akbar Al Baker, CEO of Qatar Airways, who flew to Italy in last days to meet Italian instituions could look similar to the recent  purchase of 49% of the stake of Alitalia made by Etihad that but, by many meanings, this operation could not be considered the same.

Meridiana is a small airline company, controlled by Ali Sarda S.p.A., a company owned by a fund of Aga Khan. The airline is currently the fourth carrier on Italian national market, its fleet is composed by 20 aircrafts and has a limited network. In last years the company registered important losses and has been recently struggling with trade unions for redundancies.

The trade unions are to play still a main role in the Meridiana’s affair while the negotiation will be finalized only after their final approval.

So one may ask why Qatar wants to bet on such a discouraging scenario?


This should be seen as a mere asset investment or as a strategy move in the aviation global industry?

Despite the opportunity of enter the rich and mature European civil aviation market from Sardinia, a tourist hotspot in the middle of the Mediterranean, the real intensions of this purchase go beyond airline strategy.

Since 2012 the State of Qatar has been making continuous investments in Sardinia, especially in tourism sector. As highlighted in a brilliant analysis by Capa no surprise this Memorandum of Understanding between the two parts comes just few days after the visit of the Emir at the end of last January. Indeed the Qatari purchase of Meridiana must be considered as a milestone in the series of Italian, Sardinian investments made by the Arab monarchy .

The assets of Meridiana are probably more interesting than the company’s network or slots for Qatar Airways that is already operating direct flights to Doha from 3 Italian airports.

Time and trade unions will tell us.






Morocco to develop its stock market

Since 1990, the Kingdom, hasn’t renewed the rules of its stock exchange and the recent performances of the Moroccan index, falling since five years, recently downgraded to “frontier market” status by index provider MSCI.


This new law was seen as urgent by Moroccan government to make the stock market more attractive to foreign investors as well as for small and medium sized companies. The plan contemplate the admission of listing shares in local and in other currency.

Morocco is in a special position if compared to neighbour Maghrebian countries experiencing a period of political instability and unsafety that it’s discouraging foreign investors. The Kingdom is trying to take advantage by planning to attract investments with strategical moves, like the approval of the creation of Islamic banks and of the issuance of Islamic debts by private companies. The creation of a Sharia board of experts to study and review the market activity is ongoing.

Probably this opening to Islamic finance and to foreign currency shares and investors from abroad will radically change the outlook of the financial sector of Morocco.

Syphax forced to suspend operations

Another bad new for Tunisian economy, struggling to exit from the crisis that followed the multiple terror attacks of last months, at Bardo museum and at Sosse.  Last 29th of July, IATA International Air Transport Association, stopped all the operations linked to Syphax airline because the company didn’t pay the  BSP, the Billing and Settlement Plan’s bills.

The company was launched in 2011 by Tunisian businessman Mohamed Frikha, CEO of TELNET Group, who is also a member of the Parliament, to help the economy of Southern Tunisia, mainly Sfax area, his birthplace, to grow up.


The company, with a fleet of two A-319 as stated on the the official website, hasn’t yet pointed out the connection between the suspension and the recent terror attacks  that shocked the country  and hit hard tourism sector. But it seems clear that Syphax airline’s operations have been affected by these dramatic events, as yesterday Tui chief executive Peter Long  confirmed a 20£ profit loss, following the Sousse beach attack, in an interview released to the BBC. Indeed the impact of this fear wave is still unpredictable but its consequences are already evident.

Sfax airport, the "hub" of Syphax
Sfax airport, the “hub” of Syphax

Yemen. What future for the cradle of the coffee?

Yemen is considered to be the land of origin of one of the most loved and consumed beverage in the world: the coffee. At least, from Yemen comes the first credible trace of coffee drinking in the history.

The word we currently  use in many languages to name it  derives from the Arabic word “qahwa” , after transformed by Turks in “kahve” and then  widespread in all of European languages. Coffee, as a medicine and after as a drink and as a place, has always had special place in Arab social life.

Coffee preparation and drinking for bedouins in their tents in sunny deserts, for Islamic mystics in their zawya, for chat lovers gathered in cafés in the cosmopolitan cities of Middle East, has been a special ritual for many centuries and no one ever succeeded in making desist people from drinking coffee, despite the strict prohibition, as the one imposed by Sultan Murad IV, the irascible sultan, who imposed a total ban on coffee consumption in seventeenth century.

During that period the most important port in the world for coffee trading was the one of Mokha, a coastal small city that became a commercial hub under Ottoman rule.


With the decline of coffee exportation and traffic, caused by the emergence of new big producers, like Brezil, the city of Mokha, during last century, became again the small port of fishermen it was before the sixteenth century. Currently 10,000 persons are living there but the name of Mokha could be heard anywhere as it is used to describe the classic Italian coffee-machine “moca”.20150725_181537[1]

Coffee production in Yemen has also been supplanted by qat, a legal drug extremely popular in the country, because farmers prefer to plant qat instead of the renowned Yemeni coffee typiacal varieties, ‘Oudayni, Addawairi, Tuffahi and al-Bor’i.

Coffee production is costly and the commerce is not profitable as qat trade. In 2013 the annual coffee production of Yemen was of 20.000 tons, but the potential for a growth was good before the exacerbation of the conflict between the rebels supporting th Houthi clan and the pro-governnt supporters, that drove the country to an extremely hard and insecure situation.

But one day, when the ongoing political turmoil will end, the future authorities must bet on the recover of the coffee sector. The benefits of it will be of major importance for economy and the history of he country where coffee was born .


“CARnival” Omani Bank Nizwa to compete with traditional banks

Bank Nizwa is an Omani bank founded in 2013. Since its launch the bank has offered Sharia compliant services and products to its customers.

Street of Nizwa
Street of Nizwa

Few branches have been already opened in Oman, but the bank is planning to grow more and to expand its netwoork.  Probably the launch of “CARnival” campaign during the current holy month of Ramadan is a part of this ambitious project.

Bank Nizwa is offering to its customers the occasion to access an auto-financing with a competitive fixed profit rate of 4,96% without any hidden fee. As stated on the bank’s website this product is based on the concept of murabaha. Bank Nizwa is actually challenging with conventional banks in auto-finance, proving the competitivity of Islamic banking.


Furthermore some branches are making late openings exceptionally during this Ramadan’s month from 9pm to 11pm in order to guarantee the best service to the customers, fasting during daytime. This special campaign will finish on August 15, longtime after the end of the Holy Month.

The committment of Bank Nizwa to Islamic principles is almost total, as proved by the Masoolyati campaign. The charity action made by Bank Nizwa’s employees, on a volountary base, who decided to give food assistance to the poorer families of the Sultanate of Oman.

The values of respect of  Islamic rules, transparency, charity and sharing has been strongly stressed by Bank Nizwa during the undergoing Holy Month. This is not the first time the bank shows its commitments to social and religious aspects and probably this will be not the last. The Omani bank wants to be considered an actual alternative to conventional banks, with a system of strong  values behind the banking organization.

Barça revival on Turkish coasts?

This blog is about economy and life. Today I am going to spend few words about foootball, the world’s most followed sport whose importance in people’s life and in world’s economy is notable.

Turkey is growing and Turkish Southern coast-side seems now to be attractive not only for hordes of all-inclusive vacationers from Russia and Northern Europe but also for some close to retirement football champions.

Eto’o and Gencer, the president of Antalyaspor, probably don’t subscribe my point of view and Ronaldinho doesn’t too. Sport newspapers emphasized Samuel Eto’o and Victor Valdes purchases by Antalyaspor’s president Gültekin Gencer, a Turkish business man operating in retail sector, describing the magnificent future projects of the club. Gencer added fuel to the flames while he openly declared that his ultimate target is Lionel Messi.

messi antalya

Antalyaspor’s fans cannot hide their enthusiasm and dream in this hot Turkish summer. They trust the president who, since his installement in 2013, has started building a new stadium and brought back to Super Lig the club. They trust Gencer even when he says that his ambitious project to make Antalyaspor one of the biggest club of Turkey and of Europe is just started.

After these three market operations, it seems clear that Barcelona’s model is inspiring this new magnificent Turkish project.

But the skepticals could argue: how is it possible to start a new project starting from the stars in their thirties of the glorious Barça of 2006?

But Gencer is a successful business-man, he is the CEO of Genpa and the president of a local business association. He might be familiar with business plans and used to plan long-term.

In future we will learn if what Gencer is making this July is only a marketing campaign or a strategical move.

Dubai to become world’s biggest hub for sukuk?

Sukuk, the plural of the Arabic word Sakk, are financial certificates. Usually, in international press, they are translated using the expression “Islamic bonds” while these financial instruments are widespread in Muslim world, since Middle Ages long before the issuing of bonds. Since 80ies with the emergence of the modern Islamic finance, sukuk have been structured with the aim to comply to Islamic law, denying the charge or the pay of any interest on money. A typical way of avoiding interest, riba, is to base sukuk on tangible assets.

In last days, Standard & Poors Rating Services warned that global issuance of sukuk is expected to be halved. This stating was really shocking for Islamic finance experts because a strong slowdown was not easy predictable in sukuk issuance, as it has been growing fast in last years.

The major cause of this slowdown is the non-issuance of one of the world’s biggest sukuk issuer: Bank Negara Malaysia. This governament backed institution decided to change instruments of financing. Not only but also the fall of oil prices, the global climate of uncertainity and the slowdown of some emerging economies could have discouraged the issuance of “Islamic bond”, reducing the global value of issued sukuk from $110 billions of 2014 to $50-60 billions expected for 2015.


In this scenario, Dubai is trying to overtake other Islamic finance hubs, as last month it reached $36,7 billions of sukuk listed on Nasdaq Dubai and Dubai Financial Market , the two stock-exchange of the Emirate from $7 billions of 2013. The emand of these “bonds” is bigger than the current offer, stated Hamed Ahmed Ali, Acting Chief Executive Officer at Nasdaq Dubai, in a recent interview released to Reuters. This growth adheres to the planned strategy which aim is to make Dubai, exploiting its geographical position at the center of a Muslim region to attract investors, the major financial centre for listing sukuk and probably to overtake Kuala Lumpur, London, Luxembourg and other competitors in this special “race” to scepter of Islamic finance. But any forecast could easily become inaccurate in this turbulent moment.

Latest news about Islamic funding in Middle-Eastern aviation

Much has been said about the outstanding emergence of Islamic finance. But what is happening in aviation industry recently is something that is not getting unnoticed by analysts and observers.

During the last Paris Airshow, 15/21 of June 2015, Airbus announced the deal for the delivery of 30 A320 neo and 20 A330-300 to Saudia Airlines, as stated by Reuters. The aircrafts will be bought by International Air Finance Corporation, a leasing fund installed in Dubai, created about one year ago by the aircraft manufacturer and the Isaudiaslamic Development Bank to provide sharia-compliant financing exclusively to Airbus customers in Middle East, Asia and Africa.

This is the biggest deal in Saudi carrier’s history and the biggest deal in aviation history in which Islamic financing has been involved.

Airbus, in last fifteen years, has been strengthening its market share in the area and probably the creation of an “Islamic” aircraft leasing fund should be seen as a signal of further commitment to Middle Eastern market.

This is the fastest growing area for aviation business in the world, the forecast is for a 13% growth this year, and its major players, the Gulf carriers Emirates, Qatar and Etihad, have drastically transformed the air transport market in last years, having been also accused by Americans of making unfair competition.

The deal announced in Paris meeting closely follows the agreement signed by Kuwait Airways for the acquisition of five A330-200 financed by the above mentioned fund last month.

This acquisition was made by Saudi legacy carrier, whose current fleet is of 119 aircraft, to cover regional routes and should be considered  a strategic move to compete in this difficult market.

No surprise about the funding method choose by the Middle Eastern company. Islamic financing is typically asset-based and it fits extremely well to the aviation industry.

Murabaha, a deferred payment sale, was the sharia-compiant financial instrument used to finalize the last deal with Kuwait Airways while the instrument chose to grant the delivery of these fifty aircrafts to Saudia has not been clearly disclosed.

For sure this is not the first and it will not be the last supply of airplanes granted by Islamic funds.

Welcome on Jaoola!

This is my very first post. I would like to introduce what I would like to talk about in this space.

I choose to name it Jaoola in Ali Douagi‘s honor. Jaoola bayna hanat al Bahr al Mutawassit, a tour between bars of the Mediterranean is the title of his most famous work, I decided to quote this heading modifying it, because a tour between the bars, the banks, the life and the money of this troubled area is what I want you to do reading these pages.

Happy reading!