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Qatar, Saudi and Israel in investment venture 15, August 2010

Posted by thegulfblog.com in Israeli-Palestinian Conflict, Qatar, Saudi Arabia.
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An Israeli conglomerate will be joined by Qatar and Saudi Arabia to invest together in emerging markets.

Under the auspices of Credit Suisse (in whom the Qatar Investment Authority (QIA) are the largest shareholders: 10%) the troika will launch a $1 billion fund for investment. The Saudi side, the FT reports, that it is led by the Olayan Group, one of the longest established Saudi business families. QIA is leading the Qatari end and IDB controlled by Israel’s “most powerful businessman” Nochi Danker who has a 3% stake in Credit Suisse, plays the Israeli role.

It appears as if this has been led by Credit Suisse and is not some kind of ‘statement’ by Qatar and Saudi Arabia in choosing to work with an Israeli partner. A QIA spokesman, for example, gave the refreshing answer that he had “no idea” about any of this.

Whilst Qatar has been seeking to reopen the Israeli trade office in Doha in recent months in a quid pro quo for access to Gaza and might well look for other opportunities to work ‘with Israel’, the same cannot be said for Saudi Arabia. Israeli relations for Saudi Arabia are a taboo. Whilst there have been mooted meetings at conferences and summits, these are usually pleasantly deniable.

If certain actors in the Kingdom decide to pick this story and highlight it, this venture will fall flat quickly. While the erudite, well-traveled Saudi businessmen will have no problem in such a deal (an Israeli’s money is as good as anyone else’s) the accompanying press coverage may be highly unwelcome.

Qatar holdings buys Harrods 10, May 2010

Posted by thegulfblog.com in Qatar, UK.
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Harrods, London’s largest and most venerable of department stores, has been bought by Qatar’s sovereign wealth fund for $2.2 billion. The crazy eccentric former owner Muhammal Al Fayed owned the store since the mid-1980s and had swornn as late as last week that he would never sell the store.

This is but the latest investment by Qatar in Western blue-chip institutions. In the past few years Qatar has bought all or large parts of Sainsbury’s supermarket, Porsche, Volkswagen, Barclay’s bank, the London Stock Exchange, the former US Embassy in central London, Canary Wharf, Credit Suisse and a French shipyard, to name but a few acquisitions.

First and foremost, Qatar wants returns for these investments. Although $2.2 billion may seem rather expensive for a shop, Harrods is situated, it must not be forgotten, in Kensington central London and sprawls over a massive 11,000 square meters. It also makes a profit. A second but still important consideration for Qataris is in the symbolism of their acquisitions. They typically only buy the very best brands in strategically important countries. This increases the country’s profile, publicises Qatar’s name as a financial powerhouse and ties Qatar ever more into the economies of some of the strongest nations on earth. So that – essentially – if something should happen to Qatar someday, they might be more inclined, motivated or willing to help out.

I also think that Qatar’s investments are so frequently in banks, hotels, property and high-end stores that perhaps decision makers are keeping the Qatari public in mind too so that they can see ‘where their money is being spent’. Qataris can identify will all these institutions and will no doubt be pleased that when they spend their next £10,000 in the outrageously expensive Harrods they are, effectively, giving the money back to Qatar.

Plans have been mentioned to open a Harrods in Shanghai. This would not surprise me at all. There will doubtless be one opening in Doha too within a few years. The last ‘bright side’ to this deal is that it presumably removes the chance for Al Fayed to entomb himself in a sarcophagus somewhere in Harrods as he had previously sworn.