the mediterranean: opportunities to develop ...by tipografia città nuova, p.a.m.o.m. - via san...

June 2010

ISTITUTO AFFARI INTERNAZIONALI

Quaderni IAI

18This Quaderno IAI focuses on the European Unionrsquos policies of

cooperation with its Mediterranean neighbours and looks into

how GCC countries can assist the transition process in these

countries Does the Southern Mediterranean offer opportunities

for cooperation between the EU and GCC countries Indeed

given the Gulfrsquos economic boom and growing investment in

North Africa GCC countries are well positioned to play a more

central role in the Mediterranean In addition the Gulf region

has close political ties with states such as Morocco Algeria

Egypt Lebanon and Syria Saudi Arabia and Qatar for instance

have already played an active diplomatic role in the last few

years in mitigating potential conflict situations Yet the contri-

butions to the Quaderno IAI while emphasizing the opportuni-

ties for EU-GCC economic cooperation in the Mediterranean

area warn of the political weaknesses in EU-GCC relations and

argue that such difficulties may not allow for establishment of

the kind of political cooperation framework that more intense

economic cooperation requires

THE MEDITERRANEANOPPORTUNITIES TODEVELOP EU-GCC

RELATIONSEdited by Roberto Aliboni

EnglishSeries

Quad IAI 18 EN_copertQuad IAI 18 en_cop 21-06-2010 935 Pagina 1


Quaderni IAI



June 2010 18English Series

IAI Q 18 EN v2 21-06-2010 918 Pagina 1

2

This publication a part of the Al Jisr Consortiumrsquos on rdquoEU-GCC Public Diplomacy and OutreachActivitiesrdquo project has received 50 percent of its funding from the European Commission We wouldlike to thank the Consortium the Italian Foreign Office and the Compagnia di San Paolo (Turin) forthe rest of the funding for the publication of this Quaderno IAI and for the organization of the sem-inar in which the papers were presented and discussed

Authors

Samir Abdelkrim Investment Intelligence Officers ANIMA Investment Network Marseille

Roberto Aliboni Vice President Istituto Affari Internazionali (IAI) Rome

Edward Burke Research Fellow Fundacion para las Relaciones Internacionales y el Dialogo ExteriorFRIDE Madrid

Ana Echaguumle Researcher FRIDE Madrid

Pierre Henry Investment Intelligence Officers ANIMA Investment Network Marseille

Christian Koch Director of International Studies GCC-EU Relations the Gulf Research Center(GRC) Dubai

Naji Abi-Aad Office of the Deputy Premier Ministry of Energy and Industry Doha

Beacuteneacutedict de Saint-Laurent General Delegate ANIMA Investment Network Marseille

Richard Youngs Director-General FRIDE Madrid

Quaderni IAI

Editor Natalino RonzittiManaging Editor Sandra Passariello

Istituto Affari Internazionali00186 Roma ndash Via Angelo Brunetti 9Tel 39-6-3224360 Fax 39-6-3224363httpwwwiaiit ndash e-mail iaiiaiitSend orders to iai_libraryiaiit

copy Istituto Affari Internazionali

Printed in June 2010by Tipografia Cittagrave Nuova PAMOM - via San Romano in Garfagnana 23 - 00148 Rome

Tel amp fax 066530467e-mail segrtipografiacittanuovait

IAI Q 18 EN v2 21-06-2010 918 Pagina 2

3

CONTENTS

Introduction Christian Koch

List of Acronyms

1 Why the European Union Needs a lsquoBroader Middle Eastrsquo PolicyEdward Burke Ana Echaguumle and Richard Youngs

2 Investment from the GCC and Development in the Mediterranean TheOutlook for EU-GCC Financial and Economic Cooperation in theMediterranean Beacuteneacutedict de Saint-Laurent assisted by Pierre Henry andSamir Abdelkrim

3 Energy in the Mediterranean and the Gulf Opportunities for SynergiesNaji Abi-Aad

4 EU And GCC Strategic Interests in the Mediterranean Convergence andDivergence Roberto Aliboni

Agenda of the Seminar on ldquoThe Mediterranean Opportunities to DevelopEU-GCC Relationsrdquo Rome 10-11 December 2009

5

10

13

31

57

69

77

IAI Q 18 EN v2 21-06-2010 918 Pagina 3

4

IAI Q 18 EN v2 21-06-2010 918 Pagina 4

5

INTRODUCTION

Christian Koch

Within the framework of the al-Jisr Project on EU-GCC Public Diplomacyand Outreach Activities and with the support of the EuropeanCommission the Istituto Affari Internazionali (IAI) and the Gulf ResearchCenter (GRC) organized a two-day workshop focusing on how theMediterranean region can become a field of cooperation between the EUand GCC countries The event brought together 30 policy officials and spe-cialists to deliberate on questions such as should the Mediterraneanbecome a dimension in the EU-GCC political dialogue where are thepotential synergies when it comes to the role of energy what ways andmeans of financial and economic cooperation present themselves to pro-mote investment and development and where do political and strategicinterests between the EU and the GCC converge or diverge in theMediterranean A final roundtable served as a wrap-up for discussion witha focus on policy recommendationsWhile many of the participants at the meeting referred often to ldquomissedopportunitiesrdquo when it comes to EU-GCC relations in the Mediterraneanand elsewhere the discussion also made apparent the fact that close con-nections exist between the Gulf and the Mediterranean on the one handand Europe and the Mediterranean on the other Events and developmentsin one region have an impact in the other yet the linkages have not beenmade a permanent aspect of an emerging triangular relationship For themoment the structural limitations prevail whether in terms of the highlyfragmented construction of European foreign policy in the Middle East andNorth Africa or the lack of institutional mechanisms through which theGCC states could engage with the Mediterranean countries Cooperation isthus ad-hoc and individualistic and lacks a strategic frameworkAt the sametime potential areas for cooperation exist in such diverse fields as invest-ment energy flows development assistance political dialogue and mar-

IAI Q 18 EN v2 21-06-2010 918 Pagina 5

Christian Koch

itime security Further opportunities for cooperation should thus beexplored keeping in mind that such cooperation needs to proceed on dif-ferentiated tracks whether at bilateral multilateral or government and non-governmental levelsThe opening presentation on ldquoThe Mediterranean in EU-GCC Relationsrdquohighlighted a ldquoplethora of highly institutionalized initiativesrdquo on the side ofthe EU but ldquonegligible linkage to policy in the rest of the Middle Eastrdquo Inits determination to keep the Mediterranean separate the EU tends toignore that the GCC states have emerged as significant players both interms of economic development as well as mediators in various aspects ofregional affairs Within the context of deeper intra-Middle East integrationthere are opportunities between the EU the GCC and the Mediterraneanfor better ldquotriangulationrdquo but so far a disjuncture between the componentsremains notable As a result ldquoa better and clearer balance is requiredbetween bilateral subregional and broader Middle East dynamicsrdquo to movetowards a logic of graduated regionalism For the GCC states the problemdoes not appear to be one of EU initiatives but rather the way these initia-tives are constructed and communicated The EU should thus look serious-ly at the structure of its policies It was also mentioned that the GCC hasalternatives and does not need to remain solely focused on ties withEurope While the Mediterranean is a hinterland increased focus is alsobeing given to relations with Asia and Africa Significantly no direct men-tion was made of the Arab League or the now defunct Euro-Arab dialogueThe second session on ldquoEnergy in the Mediterranean and the GulfOpportunities for Synergiesrdquo highlighted that the Mediterranean ldquois expect-ed to play an increasingly important role in global energy flowsrdquo whichmight result in a greater European dependence on North African suppliesand less on the Gulf At the same time potential synergies are said to existin such fields as the development of renewable energy sources (also withthe placing of the International Renewable Energy Agency in Abu Dhabi)and investment required to meet domestic electricity demand As far as oiland refined products are concerned the volume and direction of oil flowsto and through the Mediterranean will be important especially as anexpected rise in transport in the near future contains serious security impli-cations As a result an increased focus on the development of a pipelinenetwork between the Mediterranean and Europe might open possibilitiesfor Gulf involvement The same could apply for the supply of natural gasto Europe In the field of power generation the improved ability to trans-

6

IAI Q 18 EN v2 21-06-2010 918 Pagina 6

Introduction

mit electricity over longer distances opens the door for establishing a con-tinuum of interconnection from the Gulf to Europe through theMediterranean and the ability to serve markets along those connectionsFinally the rapidly rising awareness of the need for renewable energysources suggests an additional field of cooperation In many of the abovesuggested areas the potentially important role of Turkey was mentionedseveral times in the discussionThe third session was entitled ldquoInvestment from the GCC and Developmentin the Mediterranean The Outlook for Financial and Economic EU-GCCCooperationrdquo Some of the basic questions posed at the outset were whetherthe trend of Gulf involvement in the Mediterranean economies was sustain-able what the specifics of those investments are and could a triangularcooperation be envisaged What is clear is that Gulf investors have becomemajor players in the Mediterranean with an investment volume of morethan 70 billion Euro in nearly 700 projects In addition there are announce-ments totaling an additional 160 billion Euros although in this case the glob-al financial crisis has dampened somewhat the prospects of all of these ideasbeing turned into reality In terms of origin the UAE leads the field with 52percent of the projects with the Mashreq tending to be more attractive toGulf investors than the Maghreb regionBesides the existing ties it was suggested that a triangular relationshipcould develop that combines European know-how technology savings sur-plus and labor supply with the human and natural resources as well as theinfrastructure and social needs of the Mediterranean countries and finallythe energy financial resources and the need for secure investments of theGCC states For the moment such a relationship exists as far as businessoperators are concerned but it remains unbalanced and has as such notassumed the format of an organized cooperation playing field For examplewhile the EU is still the main investor in the Mediterranean there are draw-backs such as limited private investment and a lack of vision and politicalwill Similarly in the case of the GCC states economic and investment tieswith the Mediterranean have not always fulfilled the expectations resultingin some disappointments To overcome such shortcomings it was suggest-ed that a permanent dialogue platform be created to build confidence con-centrate on developing small and medium enterprises (SMEs) and consid-er formulating an investment charter focusing on the quality of foreigndirect investment Possible attention to corporate governance models andinvestment in large-scale infrastructure was also mentioned

7

IAI Q 18 EN v2 21-06-2010 918 Pagina 7

Christian Koch

The final session was titled ldquoEU and GCC Strategic and Political Interestsin the Mediterranean Convergence and Divergencerdquo It was initially men-tioned that while the EU and the GCC share a number of strategic andpolitical interests they have developed ldquodistinctly different broad patternsof strategic concerns and relations in the last 20 to 30 yearsrdquo One differ-ence is that while Europe has concentrated on its immediate neighborhoodthe Gulf has incorporated a global perspective into its foreign and securitythinking Also while the Gulf is looking increasingly towards Asia Europeis focused on North America The result of such different orientations is thelack of a common core strategic relationshipNevertheless the session highlighted that the Mediterranean region couldserve as a point of contact through which common strategic perspectivescould be developed This is because the part of the Mediterranean is con-sidered as belonging to the Arab world and the Mediterranean Sea also rep-resents a juncture of European and Gulf geopolitical approaches The factthat up to this point the EU and the GCC have failed to capitalize on theeconomic and financial factors that provide a basis for convergence in theMediterranean is thus not a reason not to cooperate in more strategic areasif the necessary will can be enacted In this context it will be essential forboth sides to overcome seeing the Mediterranean as part of the Cold Waror balance of power complexIn conclusion the need for realism in the status and prospects for EU-GCCcooperation with regard to Mediterranean issues was underlined althoughit was also made clear that many potential points of contact exist that couldbe developed further In all of these instances it appears to be more appro-priate to pursue cooperation on a project by project basis while at the sametime continuing to provide such contacts a broader strategic framework

8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS

ADIA Abu Dhabi Investment AuthorityADIH Abu Dhabi Investment HouseAfDB African Development BankAGP Arab Gas PipelineARNET Arab Network of RegulatorsAMF Arab Monetary FundASEAN Association of South-East Asian NationsASEM Asia-Europe MeetingBOO Build-Own-OperateBOT BuildOwnTransferBP British PetroleumCCS Carbon Capture and SequestrationCDM Clean Development MechanismCEO Chief Executive OfficerCER Certified Emission RightCO2 Carbon DioxideDP World Dubai Ports WorldEIB European Investment BankEMP Euro-Mediterranean PartnershipENP European Neighbourhood PolicyEOR Enhanced Oil RecoveryEU European UnionEURATOM European Atomic Energy CommunityFDI Foreign Direct InvestmentFTA Free Trade AreaGAFTA Greater Arab Free Trade AreaGCC Gulf Cooperation CouncilGDP Gross Domestic ProductGW GegawattICT Information and Communication TechnologyIDB Islamic Development BankIIF Institute of International FinanceIMF International Monetary FundIPP Independent Power ProducerIRENA International Renewable Energy Agency (UN)

10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms

JV Joint VentureKIPCO Kuwait Projects CompanyLNG Liquefied Natural GasMampA Merger and AcquisitionMED countries Mediterranean countriesMED-10 Algeria Egypt Israel Jordan Lebanon Morocco

Palestine Syria Tunisia TurkeyMENA Middle East and North AfricaMERCOSUR Mercado comuacuten del Cono SurMIPO Mediterranean Investment Project ObservatoryNBK National Bank of KuwaitNGO Non-governmental OrganizationOECD Organisation for Economic Co-operation and

DevelopmentOPEC Organization of the Petroleum Exporting

CountriesPAFTA Pan Arab Free Trade AreaPE Private EquityRES Renewable Energy SourcesSADC Southern African Development CommunitySAMA Saudi Arabian Monetary AgencySME Small and Medium EnterpriseSWF Sovereign Wealth FundTGC Time Gain CompensationUAE United Arab EmiratesUfM Union for the MediterraneanUN United NationsUNCTAD United Nations Conference on Trade and

DevelopmentUSA United States of AmericaUSGS United States Geological SurveyWB World BankWIR World Investment Report

11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12

European foreign policy in the Middle East and North Africa (MENA) is ahighly fragmented construction Since the mid-1990s the EUrsquos policies withMaghreb and Mashreq countries have been pursued under the rubric of theEuro-Mediterranean Partnership (EMP) the European Neighbourhood Policy(ENP) and now the Union for the Mediterranean (UfM) This plethora ofhighly institutionalised initiatives has been developed with negligible linkageto policy in the rest of the Middle East Relations with the Gulf CooperationCouncil (GCC) remain low key and strikingly disconnected from the EMPContrary to its rhetorical emphasis on supporting regional integration aroundthe world the EU has failed to build its strategy towards Iran and Iraq into aregional security framework Even more reproachable given its credibility andinfluence in the economic sphere has been the EUrsquos inability to foster region-al economic integration between the Mediterranean and the GulfMany member states have for long held up the Mediterraneanrsquos separationfrom other dimensions of Middle Eastern policy as a positive distinction ofEuropean foreign policy This overarching policy design certainly seemshighly distinctive to the United States other powers and international insti-tutions who structure their efforts in terms of a Middle East policy ratherthan separate Mediterranean and Gulf policies Many European diplomatsstill argue that organising policy around a Mediterranean logic is a welcomeadvance on the historical legacy of colonialismHowever important trends now render the divide between EuropersquosMediterranean and Gulf policies increasingly incongruous We identify here

13

1 WHY THE EUROPEAN UNION

NEEDS A lsquoBROADER

MIDDLE EASTrsquo POLICY

Edward Burke Ana Echaguumle and Richard Youngs

IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14

two factors that are of particular importance First Gulf states are increas-ingly active in and interdependent with Mediterranean (Maghreb andMashreq) states Second the Obama administration is making efforts to re-engage more positively with the Arab world in a way that links togetherchallenges in different parts of the Middle East It makes little sense for theEU to work against the grain of these trendsIn response to these changes the EU should work towards a single MiddleEast policy Splitting up North Africa and the rest of the Middle East forthe EUrsquos bureaucratic convenience belies the political logic of the regionThe continued resistance of many member states to such a step is a costlymistake It privileges narrow-minded short-term interest to the detrimentof strategic foresight We suggest six policy questions in relation to whichEurope southern Mediterranean states and Gulf countries can more pro-ductively work together under a broader Middle East regional framework

1 The Gulf in the Mediterranean

Gulf states are playing an increasingly influential role in the MediterraneanThis trend has been most recently illustrated by the repercussions of theDubai debt restructuring announcement on the Egyptian stock exchange1

European Middle Eastern policy must begin to react to the deeper linkagestaking shape between the Gulf and the Mediterranean in a range of areaseconomics politics social and communications exchanges remittances anddevelopment assistanceThe long decline and traumatic implosion of Iraq the isolation of Egypt fol-lowing its recognition of Israel and suspicions over Syriarsquos relations with Iranand Hezbollah combined with the poor economic performance of all threecountries have resulted in the rise of Saudi Arabia as the most influentialcountry in the Arab world Saudi leadership has yet to prove effective ndash thecountry has been late to get involved in Iraq thwarted in its attempts to cre-ate a unity government in Palestine caught flat-footed in its response to anescalating terrorist threat from Yemen and obliged to watch others take theinitiative in Lebanon However its rising power cannot be ignored SaudiArabia has spent millions supporting Lebanonrsquos pro-western Sunni politicalbloc in its struggle with Hezbollah is critical to the future stability of Yemen

1 Andrew England and Frances Williams ldquoFirst signs of contagion as Egyptian stocks take abatteringrdquo Financial Times 1 December 2009

IAI Q 18 EN v2 21-06-2010 918 Pagina 14

Why the European Union Needs a lsquoBroader Middle Eastrsquo Policy

15

and is seen as the only regional power capable of bringing Arab countriesinto line with the goal of a comprehensive Arab-Israeli peace deal2

Qatar has also taken it upon itself to act as mediator in regional affairs Itsincreasing diplomatic hyperactivity has been viewed as an annoyance bythe US except perhaps for its involvement in negotiations leading to UNSecurity Council Resolution 1701 which called for a ceasefire and themovement of Hezbollahrsquos militia away from the border with Israel Qataris seen by the US to be unhelpful in terms of the Arab-Israeli conflict andthe challenge of Iranian ambitions and is generally regarded as punchingabove its weight Saudi Arabia has also viewed Qatarrsquos mediation effortsmost particularly in Lebanon and Yemen with a strong degree of scepti-cism Ultimately however Qatarrsquos ties with Iran Hamas Hezbollah andZaydi Shia rebels in Yemen as well as its long-standing ties with Israel giveit unique leverage and position in the region The highly disparateapproaches of Qatar and Saudi Arabia to regional diplomacy combinedwith the pragmatism of the other GCC member statesrsquo relations with Iranhave severely hampered prospects for the emergence of a common Gulfpolitical strategy for the regionEconomically MENA trade and investment figures confirm a glaring andeven widening gap between wealth concentrated in the GCC and thestruggles of the Maghreb and Mashreq The GCCrsquos population is a mere425 million out of a total 345 million for the region yet it dominates theregionrsquos foreign exports earnings In 2007 $477 billion of the MENAregionrsquos total exports of $654 billion were from the GCC countries3 Therelative peace enjoyed within the Gulf the decoupling of political disputesfrom the maintenance of pragmatic economic relations improved manage-ment of energy revenues leading to a degree of economic diversificationand the emergence of the regionrsquos only truly successful economic union theGCC has resulted in the region rapidly out-performing other countries inthe MENA In recent years Saudi Arabia has significantly increased its shareof new intra-Arab investments to over 50 per cent4

2 Margaret Coker lsquoSaudi Arabiarsquos Renewed Political Influence Counters Tehranrsquo The WallStreet Journa1 12 June 20093 World Bank 2008 MENA Economic Developments and Prospects Regional Integration for GlobalCompetitiveness Washington World Bak 2009 p 104-114 httpgoworldbankorg1S4LTR-FQU04 Arab Investment amp Export Credit Guarantee Corporation (IAIGC) Investment Climate inArab Countries 2007 Safat IAIGC 2008 p 2 httpwwwiaigcnetid=7ampsid=5

IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16

GCC investments in the region have grown considerably due to a period ofhigh energy revenues and increased investor confidence following infrastruc-ture and internal market reforms in many Mashreq and Maghreb countriesFrom 2003 to 2008 GCC countriesrsquo investment in the rest of the MENAamounted to over $110 billion5 The rapid increase of trade with the rest ofthe MENA coupled with rising intra-GCC trade means that the EUrsquos shareof overall investment by GCC countries is declining Such a trend is corrob-orated by the Institute of International Finance (IIF) which has reported a10-15 per cent rise in Foreign Direct Investment (FDI) holdings from theGCC in other MENA countries6 The type of GCC investment has alsoshifted whereas in the 1970s and the 1980s GCC investments in theMENA were mainly in hydrocarbons and real estate today they includefinancial services and manufacturing ndash these two sectors together add up tothe 70 per cent of GCC investments in Egypt for 2007-2008 for exampleThe UAE is easily the most prolific Gulf investor in the Mashreq and theMaghreb holding over 52 per cent of new investments from 2003 to late2009 a significant portion of which are Dubai-held assets7

The GCC also has a rapidly increasing influence over the development ofcommunications in the region not least with regard to the proliferation ofnews and entertainment channels Arabsat has more than 164 million view-ers carrying such channels as al-Jazeera which has a major influence onpan-Arab opinion An important recent measure led by the GCC states wasthe establishment of an Arab Network of Regulators (ARNET) which hasmoved to harmonise regulatory practices including National Informationand Communication Technology (ICT)8

The value of Gulf investments over those from Europe can be measured insheer scale An average Gulf investment in the MENA is $268 million com-pared to $70 million from Europe9 Gulf investors have become a vitalsource of job creation in the region GCC investments now constitute a third

5 Samba Tracking GCC Foreign Investments How the Strategies are Changing with Markets inTurmoil Riyadh Samba December 2008 (Report Series) p 12 httpwwwgulfintheme-diacomfilesarticle_en452506pdf6 Ibid p 47 ANIMA Investment Network Mapping Investment in the Mediterranean 2 October 2009httpwwwanimaweborgenindexphp8 World Bank 2008 MENA Economic Developments and Prospects cit9 Pierre Henry Samir Abdelkarim and Benedict de Saint-Laurent Foreign direct investmentinto MEDA in 2007 the switch Marseille ANIMA July 2008 (Invest in Med Survey 1)httpwwwanimaweborguploadsbasesdocumentInv_Et1_Bilan-IDE-MEDA-2007_En_24-6-2008pdf

IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17

of foreign holding in Egypt and almost half in Jordan (In contrast GCCinvestors have avoided Algeria due to the complexity of regulations and theerratic behaviour of the government in Algiers10) Despite an ambiguouspolitical relationship with the Iraqi government the UAE and Kuwait haverecognised the enormous economic potential of Iraq and have been willing toput aside distaste for some of that countryrsquos ruling factions to invest heavilyndash the UAE topped the list of foreign investors for the first nine months of2009 with holdings of $37 billion while Kuwait spent $68 billion11

The long period of economic decline in the 1980s and 1990s after the mis-spent boom of the 1970s during which time the MENA share of globaltrade fell from 8 per cent to 25 per cent served as a sharp lesson for theregion12 Despite the failure to negotiate a comprehensive FTA for theMENA in 2007 intraregional trade constituted 111 per cent of total for-eign trade This is still a modest figure but a significant increase from thestagnant levels of the mid-1990s In the non-energy sector intraregionaltrade now accounts for just under 25 per cent of all exports13

Many problems persist The negotiation and implementation of a raft oftrade agreements aimed at integrating the economies of the MENA hasbeen notoriously slow and ineffectual Implementation of the Greater ArabFree Trade Area (GAFTA) negotiated in 1997 has varied considerably fromcountry to country The World Bank estimates that the total gain fromGAFTA to the MENA economy has so far amounted to a modest 01 percent boost to regional income which compares very unfavourably with thebenefits of bi-lateral trade agreements with the EU14

In the same way the lack of integration of the MENA with the global econ-omy represents a missed opportunity for economic growth ndash the WorldBank has calculated that if the MENA had maintained its 1985 share ofworld exports (which was already relatively low) it would have received

10 Mahmoud Mohieldin ldquoNeighbourly Investmentsrdquo in Finance and Development Vol 45 No 4(December 2008) p 40-41 httpwwwimforgexternalPubsFTfandd200812pdfmohield-inpdf11 Dunia Frontier Consultants (DFC) Private Foreign Investment in Iraq Update November 2009Washington and Dubai DFC November 2009 httpwwwdfcinternationalcomfilesDuniaPrivateForeignInvestmentinIraq2009UPDATEpdf12 Allen Dennis The Impact of Regional Trade Agreements and Trade Facilitation in the MiddleEast North Africa Region Washington World Bank February 2006 (World Bank PolicyResearch Working Paper 3837) p 1 httpgoworldbankorg5RUJSME18013 World Bank 2008 MENA Economic Developments and Prospects cit14 Allen Dennis The Impact of Regional Trade Agreements and Trade Facilitation in the MiddleEast North Africa Region cit p 12

IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18

some $2 trillion in extra export revenues during the period 1986-2003 Byextension if a comprehensive MENA FTA existed during this period itwould have boosted trade by a further 147 per cent15

However while such problems exist the emerging opportunities of deeperintra-MENA integration reflect an incipient trend that the EU should lockonto The reasons for the non-emergence of a free trade area in the MENAinclude the frequency of war and severe political disagreement in the regionhigh transportation and communication costs and perhaps most important-ly the preponderance of a corrupt and bloated public sector In some waysexternal actors have added to the problems the lure of trade agreementswith the US the EU and other external powers has shifted the focus awayfrom intra-regional efforts16 The GCC has been quick to complain aboutnot being consulted on EU initiatives in the Maghreb and Mashreq such asthe Union for the Mediterranean ndash although it has itself been generally reac-tive and unimaginative in its relations with other Arab states17

Although the proportion of expatriate Arab workers in the Gulf has declinedconsiderably since the 1970s and 1980s remittances to other Arab countriesremain a vital source of income totalling $31 billion in 2008 The MENAregion mainly relies on two regions the GCC and the EU as a source of remit-tances Egypt and Morocco receive the highest volume of remittances in theMENA region Remittances to Lebanon Jordan and Egypt are predominate-ly derived from expatriate labour in the GCC while those of Morocco andAlgeria are mostly from the EU Iraq and Syria are exceptions to the Mashreq-Maghreb divide as for these states both the EU and the GCC are an impor-tant source of remittances As a share of GDP for countries in the regionLebanon ranks highest with 20 per cent and 400000 expatriates in the Gulfalone followed by Jordan at 14 per cent and Morocco at 8 per cent18

There is finally a growing trend of MENA dependence on aid from theGulf region In 2007 alone Jordan received $565 million in aid from SaudiArabia19 There is also an increasing awareness within the GCC of the lead-

15 Ibid p 816 Ibid pp 7-817 Prince Turki al-Faisal Addressing the stability challenge which political responsibility for EUand GCC Speech to the Eurogolfe Conference Venice 18 October 2008httpwwweurogolfecomMessage_Turki_al_faisalpdf18 International Monetary Fund (IMF) Regional Economic Outlook Middle East and CentralAsia Washington IMF May 2009 httpswwwimforgexternalpubsftreo2009mcdengmreo0509pdf19 Andrew Mernin ldquoAmman on a missionrdquo Arabian Business 18 February 2007httpwwwarabianbusinesscom8049-amman-on-a-mission

IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19

ing role the Gulf must play in preparing the MENA for the challenges theregion will face in the future ndash 80 million new jobs alone will have to becreated in the region by 2020 to avoid severe political and social upheavalin an already combustible regional environment20 There have been someencouraging signs that the Gulf is increasing its aid to the MENAGCC member statesrsquo aid is predominantly distributed bilaterally ratherthan through multilateral channels The main multilateral institutions inthe region are the Arab Fund for Economic and Social Development (ArabFund) the OPEC Fund for International Development (OPEC Fund) theArab Monetary Fund (AMF) and the Islamic Development Bank (IDB) Ofthese the IDB distributes the largest amount of multilateral assistance inthe region providing 38 per cent of the total compared to 30 per cent fromthe Arab Fund 17 per cent from the AMF and 10 per cent from the OPECFund The Saudi Fund for Development operates almost exclusively in theform of bilateral loans from a capital base of $82 billion21 The KuwaitFund for Arab Economic Development also provides similar loans to recip-ient governments In total the Kuwait Fund has provided 17 per cent ofArab financial aid during the last thirty years compared to 4 per cent of theAbu Dhabi Fund for Arab Development22 The Saudi Fund allocates halfits budget to Arab countries similar to that of the Kuwait Fund but lessthan the 79 per cent distributed to Arab recipients by the Abu Dhabi FundThe OPEC Fund by contrast concentrates its $35 billion capital on proj-ects in sub-Saharan Africa contributing only 17 per cent of its annual budg-et to the MENA region23 In 2007 the ruler of Dubai Sheikh Mohammedbin Rashid al-Maktoum donated $10 billion towards supporting the edu-cation of young Arabs in the regionThe GCC member state Development Funds that provide loans and otherforms of assistance generally do not maintain an in-country team to moni-tor the use of funds and there are few reporting obligations on the part ofthe recipient country Yet there are emerging exceptions Innovative Gulfdevelopment organisations such as lsquoDubai Caresrsquo have already gained a rep-utation for their close monitoring of projects working with internationalNGOs such as Care International and may offer a useful template for other

20 Lionel Barber ldquoRestive young a matter of national securityrdquo Financial Times 2 June 200821 See the website of the Saudi Fund for Development httpwwwsfdgovsa22 Espen Villanger Arab Foreign Aid Disbursement Patterns Aid Policies and Motives Bergen ChrMichelsen Institute (CMI) 2007 (CMI Reports 2) httpwwwcminopublicationsfile2615-arab-foreign-aid-disbursement-patternspdf p 923 See the website of the OPEC Fund for International Development httpwwwofidorg

IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20

emerging Gulf development agencies A cash-strapped Europe would dowell to seize upon opportunities for the enhanced coordination of develop-ment funds and programmes with willing Gulf partnersThe initial years of excessive optimism on the part of GCC investors andrecipient countries are now likely to give way to a more realistic review ofinvestments following the global financial crisis beginning with a debt-rid-den Dubai A serious downturn in the GCC may feel like a lsquocrash landingrsquofor the rest of the MENA Egypt with over two million citizens working inthe GCC is heavily dependent upon the $3 billion of remittances it receivesfrom this labourAny further increases in food prices in the region could alsosee an increase in unrest as already witnessed in Algeria Egypt Moroccoand Yemen during 2008 and the first half of 2009 Reduced EU and GCCremittances investment and development assistance will seriously straingovernmentsrsquo ability to maintain political and economic stability in theregion For now much of the Gulf appears to have weathered the economicstorm largely due to resurgent oil prices but both regions would do well totake note of the vulnerability of parts of the Mashreq and Maghreb to thecurrent global crisis

2 Obamarsquos Re-engagement

A second trend highly germane to the design of European Middle Easternpolicy is the evolution of US strategy in the region The administration ofBarack Obama has sought to move beyond the more pernicious elementsof the Bush era by engaging in the Middle East with a new tone and a moresophisticated effort to link the regionrsquos problems together in a more holis-tic strategy The EU needs to seize this as an opportunity and support suchefforts rather than undercut them by stubbornly prioritising the institution-al structures of its own fragmented Middle Eastern initiativesThe EU has traditionally been very protective of its policies towards theMediterranean construct in an attempt to carve out for itself a parcel ofinfluence within the dominant US policy towards the Middle East TheMediterranean offered an area where the EU could claim an advantage andwhere it did not have to follow the USrsquos lead Obamarsquos efforts at re-start-ing the US relationship with the Middle East on a more even footing offeran opportunity for the EU to let go of an outdated mind-set which hasproved pernicious to its interests By parcelling out the Mediterranean as aEuro-sphere of influence the EU has ceded the upper hand (even further)

IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21

to the US in the Gulf Obamarsquos new MENA policies restructure the EU-US-MENA triangle and require a flexible response from the EUInstitutionally the US approach to the region reflects a broader approachwith the Bureau for Near Eastern Affairs covering all Maghreb Mashreqand Gulf countries while singling out Iraq Palestine counterterrorism andeconomic and political reform as particular regional concerns The EUwould be well served to heed this approach not in an effort to mimic theUS but because it is reflective of geographic and geostrategic reality Gulfstates view the lsquoMediterraneanrsquo as defined by the EU as a construct lessreflective of local realities than of European interests The EU often over-looks the strong relations between Mediterranean and Gulf states and thebonds of lsquoArabismrsquo that play into these relationsThe Obama administration has heralded changes in tone and approachwhich make it easier for the EU to respond and engage in a broader MiddleEast policy There has been a significant change in style tone and attitudewhich reflects greater sensitivity a US willingness to engage and to listenrather than dictate The Obama administrationrsquos change of approach hasalso been reflected in the newfound willingness to engage with Iran Syriaand Hezbollah in an effort to seek negotiated solutions to long-standingproblems This is the type of approach long favoured by the EU and a farcry from the axis of evil listings promulgated by BushAs Obama stated in an interview with Al Arabiya the US is lsquoready to initi-ate a new partnership based on mutual respect and mutual interestrsquo Under-Secretary of State William Burns further elaborated lsquoWe have reorientedour approach to diplomacy focusing on partnership pragmatism and prin-ciple This puts a premium on listening to each other respecting differencesand seeking common ground and areas of shared interestsrsquo24 This attemptto reconcile principle and pragmatism reflects the EUrsquos stated approach toexternal affairs although in reality it is often member state narrow intereststhat take precedence over EU principles The potential for deeper US-EUcooperation in the region is being squandered by the competition betweenmember states to secure lucrative bilateral defence procurement dealsWhile the extent of discussions with European governments is unclearFrance Spain and Germany have been talking with individual members ofthe GCC about security issues25

24 Speech by William J Burns Under Secretary of State for Political Affairs Conference on lsquoUS-Saudi Relations in a World Without Equilibriumrsquo New America Foundation 27 April 200925 Global Security Asia Conference 2009 httpwwwglobalsecasiacom

IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22

The failure of the EU and US to coordinate means that both are beginningto lose out to third players not only in terms of defence procurement butalso in terms of trade and energy Up to now American and European mil-itary suppliers have provided 90 per cent of the weapons sought by theGulf countries But now a potential Russian deal has taken shape to sell $2billion worth of tanks and helicopters to Saudi Arabia In 2007 RussianPresident Vladimir Putin visited Saudi Arabia the first official visit by aRussian head of state to the kingdom The Gulf states especially SaudiArabia as a member of the G20 have played an important role in support-ing international efforts to stem the global financial crisis While the GCCrsquosweight in economics and international finance has increased the half cen-tury of US predominance in the region in economic terms is over The cen-tre of gravity is clearly shifting eastwards as the loss of US standing in theregion is being filled not by Europe but rather by emerging Asian statesThe Obama administration believes that the challenges which confront theUS in the region - regional conflicts undiversified economies unresponsivepolitical systems proliferation of weapons of mass destruction and violentextremist groups - are all connected and thus should be treated simultane-ously on a pan-regional basis It also recognises the significant role Gulfstates could play in regional issues In June 2009 Secretary of Defense Gatesstated that the array of security issues affecting the Gulf are all interrelat-ed and thus would be best addressed through a comprehensive approachSpecial Representative for Afghanistan and Pakistan Richard Holbrooke hasstated that the US seeks to lsquoestablish an intellectual strategic basersquo with theGulf states to coordinate policy on Afghanistan Pakistan and Middle Eastissues On Iran the Gulf states have repeatedly asked the US to coordinateits policies with themThe Obama administration has also declared a willingness to address theIsrael- Palestine issue as a vital lynchpin of progress on all other issues in theregion For the first time the US seems to acknowledge the importance of aconflict which other Arab states consider to be the key to regional stabilityAlthough Obama began well by appointing as his Middle East special envoythe respected former senator George Mitchell and calling for a freeze on allIsraeli settlement in the Occupied Territories his resolve has since flounderedand disappointment has set in throughout the region At the beginning ofDecember 2009 the EU agreed on a statement of policy on Palestine and Israelwhich the US considered to be an unwelcome intrusion If the EU had notwillingly ceded ground to the US in all areas save the Mediterranean its poli-cies could be coordinated with rather than being subservient to the US

IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23

It is no longer expedient for the EU to sit back in the knowledge that theGulf region is a US sphere of influence Despite Obamarsquos lsquopunt on multi-lateralismrsquo it is unlikely that the US administration will go out of its way tocooperate with the EU in the Gulf The Obama administration might pre-fer to work with a more united Europe but it is up to the EU to live up tothe rhetoric and forge a strategy in the Gulf that places it in a credible roleas interlocutor for both the US and the GCC To do so it must incorporatethe Gulf and the Mediterranean into a common overarching MENA strat-egy A more proactive EU role which takes into account the Gulf statesrsquoaspirations and builds on its credibility could go a long way towards re-establishing some of Europersquos lost influence in the regionWhile the Obama administration is seeking to regain credibility the EU canstill play a much-needed role in helping smooth persistent tensionsbetween the US and MENA countries The US lsquohas so far failed to come toterms with the GCC states defining their own interests outside of the con-text of the need for US military protectionrsquo26 The US still has to realisethat the security-for-oil equation is no longer a panaceaThe Gulf states feelneglected by the US especially in terms of dealing with Iran and annoyedat being asked publicly to provide confidence building measures to IsraelMore than anything else the Gulf states want movement on the Palestinianfront for Iran to be contained but not appeased at their expense and gen-eral recognition for their role in the region On all these concerns the EUneeds to take advantage of the current juncture in US policy help mediatebetween Washington and the region and adapt its own policies to back upthe stated desire for a more holistic approach

3 Joining the Dots

European Union policy statements and ministerial speeches often refer tothe need to link together events and trends in different parts of the MENAregion In 2004 when defining the need for a European StrategicPartnership with the region the European Council observed that lsquoEuropeand the Mediterranean and Middle East are joined together both by geog-raphy and shared history [hellip] Our geographical proximity is a longstand-ing reality underpinning our growing interdependence our policies in

26 John Duke Anthony ldquoUS-GCC relationsrdquo in Gulf Yearbook 2006-2007

IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24

future years must reflect these realities and seek to ensure that they con-tinue to develop positivelyrsquo27

There is much talk of the need for lsquotriangulationrsquo between Europe the ArabMediterranean and the Gulf But in practice it is remarkable how farEuropean policy is still divided into separate lsquopolicy blocksrsquo One covers theMediterranean another the Gulf another Iraq another Iran and yet anoth-er Yemenrsquos fragile state status The disjuncture between the Mediterraneanand Gulf components is especially notable In 2008 amidst much fanfarethe Union for the Mediterranean was launched At the same time the EUrsquosStrategic Partnership with the Broader Middle East was being quietly forgot-ten No attempt was made to get these two initiatives lsquotalking to each otherrsquoSeveral member states have been actively hostile towards submerging theEUrsquos Mediterranean policy into a lsquobroader Middle Eastrsquo policy In a contem-porary institutional sense the lsquoMediterraneanrsquo is a distinctively Europeanconstruct Other powers do not have lsquoMediterraneanrsquo policies separatefrom their Middle East strategies But the reasons for blocking better coor-dination are not good ones Southern EU member states must move beyonda defensive position of defending lsquoMediterranean primacyrsquo merely becausethey fear losing a privileged EU focus on their immediate neighbours inNorth Africa GCC states increasingly seek EU support for initiatives in theMiddle East that dovetail with their own activityA broader and less fragmented approach to the Middle East would be espe-cially valuable in relation to six policy challenges

Iraq Iran and Regional SecurityIt is often pointed out that the MENA is the only region lacking an institu-tionalised security frameworkThe EU should seek to exercise what influenceit has to rectify this situation It has the potential to play such a role by har-nessing its firmly institutionalised lsquocollective securityrsquo arrangements in andwith the southern Mediterranean as a template to extend into the broaderMiddle East In particular this would entail triangulating EU-Mediterranean-GCC strategies towards Iran and Iraq GCC states have for some time pushedthe EU to assist more generously and determinedly in Iraqrsquos reconstructionand stabilisation Gulf states feel that the EUrsquos reluctance to engage fully inIraq to take GCC concerns over the direction of that country into account

27 See European Council EU Strategic Partnership with the Mediterranean and the Middle East62004 httpwwwconsiliumeuropaeuuedocscmsUploadPartnership 20Mediterranean20and20Middle20Eastpdf

IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25

and to include the GCC in their planning for future strategy in that countryrepresents one of the major strategic blockages in relations with Europe28

Gulf concerns over events in Iraq and Iran including fear of increasing Iranianinfluence represent one of the regionrsquos most pressing strategic pre-occupa-tions ndash one they feel Europe still has little empathy forThe EUrsquos aims in this sense must of necessity be modest But some concretemoves could begin to move security deliberations in this more pan-MENAdirection The Strategic Partnership for the Mediterranean and Middle Eastagreed in 2004 has been a profound disappointment having delivered littlein tangible terms that helps broaden out Europersquos policies across the MENANew and much more concrete steps should be implemented For examplethe EU could hold joint meetings of its EU-Mediterranean and EU-GCCsecurity dialogues and use this as an opportunity to provide an incentive toIraq and Iran to participate in the first steps towards a broader collective secu-rity architectureThis would constitute a major upgrading of the current lsquoIraqand its Neighbourhoodrsquo multilateral initiative By addressing Gulf concerns inthis way the EU would be more likely to convince GCC regimes to deploytheir own vast financial resources to help stabilise Iraq29 And it must be thecase that a more unified EU-GCC-Mediterranean alliance would have muchmore chance to influence developments in Iran in a positive direction

PalestineSaudi Arabia and Egypt hold key roles in the Middle East peace processThere is some competition between their respective approaches and initia-tives that risks being highly prejudicial Here the EU might find a role inmediating and ensuring that such competition between Mediterranean andGulf initiatives does not begin to harm the prospects for peace The EUshould also move to reassure Saudi Arabia that rejection of the Fatah-Hamas Mecca Agreement in 2007 by the Bush administration representeda major missed opportunity to establish a working relationship between thetwo Palestinian factions and that the EU seeks strengthened cooperationwith Riyadh on this crucial issue The EU also urgently needs to engage

28 Oxford Research Group King Faisal Center Saudi Diplomatic Institute From the Swamp toTerra Firma The Regional Role in the Stabilisation of Iraq London Oxford Research GroupJune 2008 (Briefing Papers) httpwwwoxfordresearchgrouporguksitesdefaultfilesfromtheswamppdf29 Michael Bauer Christian-Peter Hanelt Europe and the Gulf Region Toward a New HorizonGuumltersloh Bertelsmann Stiftung July 2009 httpwwwbertelsmann-stiftungdecpsrdexbcrSID-F7E2F9A6-2365C300bst_englxcms_bst_dms_29037_29038_2pdf p 16

IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26

other GCC states not least Qatar on its vision for a peaceful resolution ofthe Israel-Palestine conflict urging caution where necessary and harmonis-ing efforts where possible A sine qua non to an improved EU-GCC politi-cal relationship on this issue is for the EU to take a firm position against thecontinued expansion of Israeli settlements within the Palestinian territories

Trade RelationsThe EU has been pursuing two free trade areas one with the Mediterraneanand another with the Gulf The former is due for completion in 2010 but iswell behind schedule The free trade agreement with the GCC is still notsigned after nineteen years of talks The EU should re-energise efforts to signboth these outstanding trade deals and demonstrate greater flexibility to thisend But over the medium term the two respective EU FTAs could andshould be joined It is well known that inter-regional interdependence is at alower level in the Middle East than in other regions Joining the separatestrands of EU commercial relations together could help correct this dearthIraqrsquos putative Partnership and Cooperation Agreement could eventually belinked into this widened area of trade liberalisation The EU could in this wayuse the undoubted leverage of its common commercial regulations and normsas a means of enhancing integration within the broader Middle East region ndashso vital in political and strategic terms for Europe and the region itself

Responses to the Financial CrisisThe crisis is arriving in force on North Africarsquos shores The EU and the GCChave a joint interest in helping the Mediterranean weather the storm it willbe harder for each to help effectively on their own Several European gov-ernments now work with Saudi Arabia within the G20 They should forman alliance to address together prudential regulatory weaknesses in thesouthern Mediterranean The same implies the other way around the regu-lar dialogue and engagement the EU has built up in the Mediterranean couldbe extremely helpful in shoring up European efforts to reach further anddeeper into the Gulf Much more cooperation is needed on internationalcurrency issues too The fall-out over the Dubai debt crisis in December2009 also points to a need for an enhanced economic dialogue With theGCC inching towards a possible single currency this is an obvious area ofunder-explored lsquolesson sharingrsquo It is an area of policy cooperation that needsto be triangulated with a Mediterranean dimension too to reflect the grow-ing economic and financial interdependence of different parts of the MENAregion

IAI Q 18 EN v2 21-06-2010 918 Pagina 26

It is here that the EU should enhance cooperation with Gulf developmentfunds to pool efforts to palliate the effects of the financial crisis andencourage the economic and social reforms necessary to sustained recoveryIn an effort to support regional economic integration across MENA the EUcould extend some of the funding projects and measures which haveproved most effective in its relations with the Mediterranean countriesnamely those relative to the economic basket coordination of regulatoryand legal reform building standards and capacity judicial training andreform bureaucratic reform technical cooperation and capacity building incross-border projects twinning and administrative secondments

EnergyToday it makes little sense for the EU to pursue separate energy dialoguesand policies in the Mediterranean and Gulf Policy-makers do recognisethis The prospective pan-Arab pipeline which the EU has promised tosupport requires a restructuring of European energy policy Iraq whichholds some of the worldrsquos largest oil and gas deposits and has an egregious-ly low reserve-to-production ratio is perhaps the energy partner in theMiddle East with which Europe is underperforming most In January 2008Commissioners Benita Ferrero-Waldner (External Relations) and AndrisPiebalgs (Energy) spoke of a new lsquoEU-Iraq energy partnershiprsquo noting thatthe EU was lsquokeen to see Iraq play a full role in the Arab gas pipeline whichwill supply the EU including through the Nabuccorsquo These encouragingstatements have not been followed up by a regular high-level political andenergy dialogue with Iraq neither has significant assistance been forthcom-ing to improve Iraqrsquos creaking infrastructure in order to link it for export toEuropean markets30 There is also potential for the EU to link GCC ener-gy exports through an enhanced pipeline grid via Iraq to European marketsThe Commission has proposed extending the structure of both the ENPEnergy Treaty and the Euro-Med Common Energy House to the GCCstates as well as offering the latter the kind of energy agreement offered toAlgeria and Egypt Cooperation between Europe the Arab Mediterraneanand the Gulf has begun on the issue of solar energy However the contin-ued impasse in trade negotiations between the EU and the GCC undercutsthe prospects for other aspects of policy cooperation on a broader Middle

30 Edward Burke The Case for a New European Engagement in Iraq Madrid Fundacioacuten para lasRelaciones Internacionales y el Diaacutelogo Exterior (FRIDE) January 2009 (FRIDE Working Paper79) httpwwwfrideorgpublication555the-case-for-a-new-european-engagement-in-iraq


27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27


basis The EU has proposed a Memorandum of Understanding on energycooperation but the GCC states have rejected the idea insisting that anFTA is the precursor to deepening other areas of cooperation A long-stand-ing bi-annual EU-GCC energy experts meeting has been diminished ratherthan expanded in recent years with officials of a lower level than was pre-viously the case presiding on both sides The Commission has sought todeepen energy cooperation at the bilateral level with individual GCCstates but here the potential is limited to technical issues such as reducingflaring and energy-efficient product development Elaborating a triangulat-ed EU-Mediterranean-GCC energy strategy would offer the potential forunblocking some of these frustrating and persistent shortcomings

Counter-terrorismSaudi Arabiarsquos well-known influence over Islamist trends across theMediterranean means that it must be brought into any comprehensiveEuropean efforts to deal with radicalisation GCC cooperation is also criti-cal to stopping the flow of money to jihadi groups in places such as AlgeriaPalestine and Lebanon The EU and the GCC also face a mounting terror-ist threat emanating from Yemen The GCC is the largest donor to Yemenand critical to the future stabilisation of that country Although SaudiArabia has been reluctant to engage in bi-lateral talks on Europersquos concernsin Yemen other GCC countries have shown a more open approachEnhanced cooperation on these issues will only arise out of a trust-buildingdialogue and strategic thinking with the Gulf on major political concerns inthe region an approach that has been evidently lacking to date

4 Careful Steps Forward

In sum the overarching institutional logic should be one of graduatedregionalism This does not mean abandoning existing initiatives such as theEMP or ENP But it does mean shifting the balance of diplomatic effort todeepen the linkages between the Mediterranean the Gulf Iran and Iraq Abetter and clearer balance is required between bilateral sub-regional andlsquobroader Middle Eastrsquo dynamics These different levels must be made tolock into and reinforce emerging pan-regional dynamics rather than cuttingacross them The ENP offers at least a partial model of lsquobilateralism-with-in-regionalismrsquo which could be useful within the broader Middle East tooThe MENA region is changing US policy in the region is changing too If

28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28


the EU fails to move with these changes instead sticking fast to its ownidiosyncratic institutional structures this head-in-the-sand stubbornnesswill soon consign it to irrelevance

29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30

1 The Gulf and the Mediterranean The Beginning of an Affair

During the last decade Gulf investors have become major players in theMediterranean sometimes surpassing Europe Since the inception of theANIMA Observatory (January 2003) they have invested some 70bn Euroin almost 700 projects (a ratio of close to euro100m per project) mostly inMashreq and Maghreb They had announced even more (euro160bn) but thiswas partly for communication purposes and of course the crisis has reducedsome of their ambitions The acceleration has been recent (2006 and 2007)thanks mainly to the Emirates and in some respects was linked to a realestatetourism bubbleThis paper seeks to answer a set of questions

ndash Is the trend of Gulf involvement in Mediterranean economies sus-tainable

ndash What are the specifics of these investments Do they differ fromprojects originating in Europe or the USA What sort of value dothey bring to the region and the economies of the countries involved

ndash Could a triangular (Mediterranean-Gulf-Europe) cooperation beenvisaged as a complement to Europersquos somewhat modest interest inits Southern and Eastern neighbours How can a real partnership bedeveloped based on mutual interests

In this paper the Gulf is defined as the Gulf Cooperation Council (GCC)countries Bahrain Emirates Kuwait Oman Qatar and Saudi Arabia The

31

2 INVESTMENT FROM THE GCC AND

DEVELOPMENT IN THE MEDITERRANEAN

THE OUTLOOK FOR EU-GCC FINANCIAL

AND ECONOMIC COOPERATION

IN THE MEDITERRANEAN

Beacuteneacutedict de Saint-Laurent assisted by Pierre Henry and Samir Abdelkrim

IAI Q 18 EN v2 21-06-2010 918 Pagina 31

Beacuteneacutedict de Saint-Laurent

MED countries (or MED-10) are Algeria Egypt Israel Jordan LebanonMorocco Palestinian Authority Syria Tunisia and Turkey Libya is some-times added to this list (MED-11) as well as Cyprus and Malta for 2003and 2004 (MED-13)

2 Global Picture of Foreign Direct Investment in MED Countries

Four major players are involved in foreign direct investment (FDI) in MEDcountries Europe the former colonial power and traditional investorNorth-America interested in resources and main sponsor of Israel theGulf concerned in terms of Arab brotherhood and also looking for geo-graphicalprofit-oriented expansion and the MED countries themselvespoorly integrated but making some inroads in industrial networking (see forinstance the Egyptian Orascom grouprsquos construction or telecoms projectsand the strategies of Turkish firms in Mashreq)Relatively neglected at the global level in the early 2000s (less than 1 ofglobal FDI inflows to countries that represent 4 of the worldrsquos population)the MED countries gained significantly in FDI appeal in the 2004-2008 peri-od (around euro40bn in FDI per year or 3-4 of the world market) Two coun-tries accounted for most of this upturn Turkey a new EU candidate andEgypt benefiting since 2004 from strong reforms However the entire regionis on an upward trend for both external and internal reasons External factorsinclude proximity to Europe at a time of high energy costs and the search forlower labour costs And internal factors are continued growth since 2000pressure of domestic demand full conversion to the market economy andbusiness realism (eg Syria) and clever public investment programmes(Tanger-Med e-government in Jordan Tunisian technopoles etc) The small-er countries (Jordan Lebanon Tunisia and above all Israel) have a relativelybetter FDI performance than the larger onesThe MED region has received around euro255bn in FDI in the last 65 years(Jan 2003-Oct 20091) according to the ANIMA Observatory These fig-ures are similar to UNCTADrsquos2 which represent a different reality (macro-economic flows registered by the central banks whereas ANIMA collects

32

1 2009 is counted here as a half-year This paper is based on data collected up to October2009 but the total might represent only 50 of yearly flows since numerous projects areidentified after a year-end review with peers2 UNCTAD World Investment Report published every year in September Average ofeuro292bnyear of FDI into Med-10 for 2003-2008 vs euro369 for ANIMA same period

IAI Q 18 EN v2 21-06-2010 918 Pagina 32

Investment from the GCC and Development in the Mediterranean

all the announcements made by companies) The main beneficiaries are asalready mentioned ldquoother MEDArdquo countries (IsraelTurkeyMaltaCyprus)which capture 40 of the flow and the Mashreq (34) and Maghreb(26)The geography of these flows represented in the map below (Fig 1) illus-trates the diversity of investment preferences of the principal FDI-issuingregions Europe invests primarily in Turkey in the Maghreb and in Egyptand the Gulf mainly in the Mashreq countries The United States concen-trates on IsraelThese strong affinities are initially the product of geographythe most significant flows developing between the closest blocs (Europe-Maghreb or Europe-Turkey Gulf-Mashreq) But physical geography can beovercome or reinforced by cultural or historical affinities privileged busi-ness connections with Jordan Lebanon Syria or Egypt deriving from thefamily and patrimonial capitalism of the Gulf or close relations betweenthe USA and Israel

Figure 1 ndash Main FDI inflows to MED countries by origin and sub-region ofdestination (in eurobn)

Source ANIMA Observatory IEMed map Cumulated FDI amounts (real) over 2003-2009

33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33


Among the 4222 projects recorded by ANIMA over the 65 years from2003 to 2009 681 projects originated in the Gulf (16 of projects innumerical terms but 27 of the amounts involved) This made the Gulfsecond to Europe in the Mediterranean FDI market (Fig 2)

Figure 2 ndash Distribution of FDI projects by region of origin in real amounts andin numbers

In real amounts In number of projects

3 EU and Gulf State Investments in the Mediterranean

31 A Recent ndash Sometimes Oversold ndash Boost for the Gulf

Europe and the Gulf dominate foreign investment flows in theMediterranean albeit with a different historical background For the firsttime investors from the Gulf (GCC) (Fig 3) surpassed Europe in 2006 asthe main FDI issuers With the surge in European investments registered in2007 and the net decline in North American projects the Gulf now seemsto have joined Europe as a sustainable second investment pillar with thetwo accounting for two-thirds of the FDI inflows registered over 2003-2009

34

Asia-Oceania 5

Gulf 27

Europe40

MED-10 5Other countries 6

USACanada17

Asia-Oceania 8Gulf 16

Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34


Figure 3 ndash FDI inflows from main investing regions 2003-2009 (Real FDIamounts in eurom)

Source ANIMA Observatory Data collected until Oct 2009 (or plusmn50 of 2009 flows)

When comparing FDI announcements with actual projects (as empiricallymeasured by ANIMA considering the likelihood of project implementa-tion project breakdown into realistic stages and news updates) it appearsthat Gulf investments show the biggest differences between gross and realflows (Figure 4) Only 43 of the projects seem to have been implement-ed vs 71 for EU projects and 78 for North-American projects This ispartly linked to the sectors in which the Gulf invests (construction) whichare more prone to cancellations

35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35


Figure 4 ndash Cumulated FDI inflows 2003-Oct 2009 as announced by projectsrsquopromoters (in eurom)

Region Real FDI eurom total Gross total Ratio of origin FDI eurom realgross

Asia-Oceania 12496 5 24269 6 51Europe 102928 40 145304 34 71MED-10 11938 5 20173 5 59Other countries 14542 6 20251 5 72USACanada 44380 17 56612 13 78Gulf 69198 27 160346 38 43Total 255482 100 426955 100 60

Real FDI as revised by ANIMA especially for major projects which are generally phasedinto several stages (only the yearly amount is taken into account) Gross FDI as announced by project promoters (total investment over several years)Source ANIMA Mediterranean Investment Project Observatory (ANIMA-MIPO)

32 Comparison of EU and Gulf FDI Profiles in the Mediterranean

To better categorise Gulf investments it is useful to compare their charac-teristics with those of European FDIsBy using a multivariate analysis it is possible to map the ANIMA FDI base(Figure 5) illustrating the differences in projects issued respectively by theGulf and Europe (and MED countries themselves) In this mapping thecloser the two items the more similar their profiles It is not surprising todiscover an almost perfect triangle with Europe on the right contrastingwith the Gulf and MED countries on the left The y axis seems to depictrent-producing activities (construction tourism banking telecoms etc) vsindustrial activities (automobiles textiles electronics pharmaceuticalsetc) with a clear attraction for Gulf investors to the first and for Europeansto the secondSimilarly the largest projects (in amount and jobs involved) are on the Gulfside and the smallest on the European side The distinction in the nature ofthe projects is less marked but privatisation and acquisition lean towards theGulf while company branches greenfield developments and partnershipsare more prevalent on the EU sideThe positioning of the issuing and receiv-ing regions is specular along the dotted third axis Mashreq is clearly in theGulf field whereas Maghreb belongs to the European area of influence

36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36


Figure 5 ndash Mapping of FDI projects from GCC MED and Europe into MEDcountries

Source ANIMA Observatory Principal components analysis on 2991 FDI projects of which2078 from Europe 681 from the Gulf and 232 from MED countries themselves ndash January2003 to October 2009 The projects from other origin America Asia etc are not represented

33 Sectoral Preferences

As confirmed by Figure 6 below Gulf direct investments are concentratedin a few sectors which generate economic rents construction (public worksreal estate transport amp utilities) represents 40 of real FDI flows (andabove 66 of gross announced flows) while telecoms represent 15 banks115 and tourism 106 These four sectors account for 78 of Gulfinvestments Energy (more of a EuropeanAmerican obsession) and indus-trial sectors in general are less attractive European direct investments inMED economies are more balanced

37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37


Figure 6 ndash Sector share of cumulated FDI amounts 2003-Oct 2009 Gulf vsEU and North America

38

Sector Gulfeurom Gulf EU USA

Canada Comment

Public worksreal estatetransport utilities

27964 404 74 67 The major sectorfor Gulf investors

Telecom amp internetoperators 10580 153 151 13 A strong interest

(OgerWatanya etc)

Bank insuranceother financial services 7981 115 186 120

Creations ofnumerous JVsand branches

Tourism catering 7348 106 69 21 Numerous resorts

Energy 4146 60 232 189 Gulf not so interested in energy

Chemicals plasticsfertilisers 2810 41 12 27 Petrochemicals

Glass cement mineralswood paper 2363 34 116 13 Cement plants

Agri-business 1722 25 34 30 Some interest in distribution(malls) and agri-businessDistribution 1644 24 36 10

Other or not specified 1536 22 08 12

Car manufacturing or supplies

532 08 22 05

Weak Gulf investment in these industrial sectors

Metallurgy amp recycling of metals 265 04 12 00

Textiles clothingluxury goods 167 02 05 09

Pharmaceuticals 57 01 12 16

Electric electronic amp medical hardware 25 00 08 63

Furnishing and houseware 24 00 00 00

Aeron naval amp railway equipt 12 00 02 01

Mechanics and machinery 7 00 04 74

IAI Q 18 EN v2 21-06-2010 918 Pagina 38


Source ANIMA Observatory

34 Greenfield Projects often Oversized

The size of Gulf projects in the Mediterranean is twice that of EU projects(euro102m vs euro49m ANIMA average 2003-2009) If we consider the grossamount (announced at project launch) the difference is even bigger(euro235m vs euro70m) The pharaonic size of some of these projects can begauged from Figure 7 below (top 20 projects some already halted)However it would be foolish to consider Gulf investors only as conquerorswith deep pockets expecting high returns in the short term while con-tributing little to sustainable MED growth and on the contrary fuellingproperty speculation Several Gulf projects are remarkably well-conceivedadd a real value to MED economies and are sustainable (eg in logistics)The majority of the Gulf projects observed were launched by large privateor public holdings3

Globally the 681 projects originating in the Gulf have created 121000announced jobs (direct jobs) or 178 jobs per project against 93 forEuropean projectsThe sustainability of these jobs is difficult to judge but we can assume thatpart of the jobs created by Gulf investments might last only the time it

39

Data processing amp software 10 00 08 168

Very weak Gulf involvement in these hi-techsectors ndash HugeUS FDI in Israel

Consulting amp services to comp 5 00 03 02

Biotechnologies 00 02 08

Electronic components 00 01 152

Electronic ware 00 04 00

69198 1000 1000 1000

3 However projects are more difficult to detect in the Gulf than in Europe insofar as theGulf business environment is less conducive to transparency and publicity Medium and smallprojects might therefore go unnoticed by the ANIMA Observatory meaning that Gulf SMEscould be under-represented

IAI Q 18 EN v2 21-06-2010 918 Pagina 39


takes to complete the facilities (real estate projects) EU projects on theother hand usually generate more sustainable jobs in services or industryGulf investors express a strong preference for greenfield projects (creation ofnew facilities accounting for 93 of the total vs 73 for Europe and 41 forNorth-America) Brownfields (extension of an existing unit) are ignored byGulf investors whereas they represent almost 30 of American projects Theremaining Gulf investment goes to JVspartnerships (6) and branches (1)

Figure 7 ndash Top Gulf investments announced in the MED countries (grossamounts)

Egypt 2006 (DP World United Arab Emirates) euro7bn Dubai PortsWorld intends to invest in several projects in Egypt including a new sea-port and a container terminal at Eastern Port Said

Jordan 2009 (Al Maabar United Arab Emirates) euro68bn The consortiumis to build the countryrsquos biggest real estate project Marsa Zayed under aBOT (BuildOwnTransfer) model this will involve moving Aqaba port

Egypt 2009 (Barwa Real Estate Qatar) euro665bn The real estate companyis to develop a mixed-use community project of over 84 km in New Cairo

Turkey 2005 (Oger Saudi Arabia) euro51bn Saudi Oger to get 55 ofTurk Telekom for US$655bn its Italian partner is investing only euro137m

Tunisia 2008 (Abu Dhabi Investment Authority (ADIA) Abu DhabiInvestment House (ADIH) + Gulf Finance House United ArabEmirates) euro46bn ADIH to launch its Porta Moda real estate project inTunis land plots provided by Gulf Finance House

Egypt 2007 (Damac United Arab Emirates) euro407bn The UAE-basedpromoter is to invest poundE30bn in a project in New Cairo the first phasebeing called Hyde Park

Jordan 2006 (Horizon Development Lebanon) euro4bn A US$5bnmixed-use real estate development in Aqaba on the Red Sea by HorizonDevelopment

Tunisia 2006 (Bukhatir Investment United Arab Emirates) euro4bnBukhatir Investment to start the construction of the US$5bn TunisSports City project expected to create up to 40000 new jobs

Egypt 2005 (Emaar Properties United Arab Emirates) euro32bn Dubaiproperty giant plans four-billion-dollar Cairo scheme

40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41

Turkey 2005 (Dubai International Properties United Arab Emirates)euro32bn The firm to invest five billion dollars in projects in Istanbul

Algeria 2007 (Emaar Properties United Arab Emirates) euro29bn Thedeveloper to invest in an ambitious tourism project in Colonel Abbeswest of Algiers to be developed on an area of 109ha

Syria 2005 (Emaar Properties United Arab Emirates) euro27bn Emaarlaunches Damascus Hills for US$34bn project includes luxury flats anda ldquoDigital Cityrdquo

Egypt 2006 (Majid Al Futtaim United Arab Emirates) euro24bn AfterDubai Majid al Futtaim launches its Festival City concept in Cairo aUS$3bn project

Egypt 2006 (Etisalat United Arab Emirates) euro234bn Emirates tele-com company Etisalat has won the bid to run Egyptrsquos third mobile net-work paying poundE167bn for the licence

Morocco 2006 (Al Qudra Holding United Arab Emirates) euro22bn AlQudra announces project investments with Addoha and Somed of morethan US$272bn over the next 10 years

Libya 2009 (Gulf Finance House Bahrain) euro216bn The promoter is toteam up with State-owned ESDF (6040) to launch Energy City Libyain Sabratha an economic zone for oil and gas firms

Tunisia 2006 (Dubai Holding Tecom-DIG United Arab Emirates)euro178bn Tecom-Dubai Investment Group acquired 35 of the capitalof Tunisie Teacuteleacutecom

Egypt 2007 (Majid Al Futtaim United Arab Emirates) euro17bn TheUAE-based group plans to invest poundE125bn over the next 5 years for 12new outlets for retail and commodity distribution

Egypt 2006 (Shaheen Jordan) euro16bn Jordanrsquos Shaheen to develop theUS$2bn ldquoSerreniardquo tourist resort at Sahl Hasheesh through Vantage RealEstate Development

Tunisia 2009 (Qatar Petroleum Qatar) euro16bn The group which wonthe Build-Own-Operate (BOO) contract in 2006 for the Shkira refineryplans to begin construction in 2009 and finish in 2011

IAI Q 18 EN v2 21-06-2010 918 Pagina 41


35 FDI Geography Emirates and Mashreq First

The Emirates head the league of Gulf investors into MED countries (52in volumes Figure 8) followed by Kuwait (18) and Saudi Arabia (17)Bahrain and Qatar are trailing at 76 and 44 respectively whilst Omanis almost absentIn terms of sub-region Maghreb is 24 times less attractive to the Gulf thanMashreq The good ldquoOther MEDArdquo score is linked to telecoms and con-struction investments in Turkey

Figure 8 ndash FDI flows by Gulf country of origin 2003ndashOctober 2009 (in eurom)

Country of origin Mashreq Maghreb Other MEDA Total

Bahrain 1374 1585 66 3024Kuwait 7794 3488 1322 12604Oman 7 365 373 Qatar 3938 1083 230 5251Saudi Arabia 6292 1617 3945 11854United Arab Emirates 22529 9347 4216 36092Total 41934 17485 9779 69198


About thirty private or public holdings account for the bulk of Gulf FDI inthe Mediterranean (Figure 9) Some are already global brands others aspireto such statusThese Gulf champions have changed a great deal They have attractedCEOs and top executives from the worldrsquos top multinational companies(half of the top management of Dubai Ports World is Anglo-Saxon forexample) and their personnel is trained using the most modern manage-ment sciences Their investment strategies have been rationalised and arenow less related to prestige and more to profitability and long term expan-sion These major companies often ally themselves to big local companiesor public-owned structures and generally do not interact much with localsmall- and medium-sized enterprises (SMEs)

42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42


Figure 9 ndash Major investors from GCC in MED countries

Saudi Arabia Kuwait Bahrain UAE Qatar

Savola KIPCO Ahli United Bank Aramex DiarBin Laden NBK Gulf Finance Abraaj

House Capital QtelNational GlobalCommercial InvestmentBank (Alahli) House Batelco Damac Al Rajhi MA Kharafi Dubai Holding Dallah al Baraka Zain DP WorldNesco National

Industries Group (Noor) Majid al Futtaim

Oger Al Aqeelah EmaarEtisalatDubal

4 Some Other Gulf Financing Vehicles

Private investment by companies is the most frequent investment modebut this corporate capital injection may be complemented by other instru-ments private equity funds (experiencing strong growth in the region) sov-ereign wealth funds (extremely powerful in the Gulf despite recent down-turns) Sharia-compliant funds non-governmental organisations (NGOs)and charities The investments made via these instruments are recorded inthe ANIMA FDI observatory

41 Private Equity Funds Growing Activism of Gulf in MED Markets

A recent ANIMA regional survey4 provides an in-depth monitoring ofPrivate Equity (PE) activity from 1990 to 2008 in the MED region fromMorocco to Turkey The study shows that Gulf investors account for 22of the equity committed with European investors trailing at only 3

43

4 Raphaeumll Botiveau Beacuteneacutedict de Saint-Laurent MedFunds Survey an Overview of PrivateEquity in the MEDA region Marseille ANIMA September 2008 (Invest in Med Survey 2)

IAI Q 18 EN v2 21-06-2010 918 Pagina 43


Again the Emirates head up the Gulf countries followed by Kuwait SaudiArabia and BahrainThe noteworthy trend here is the massive involvement of Gulf funds in theMED region While there were ldquoonlyrdquo 45 funds from the Gulf in the MedFunds survey (14 of the total) they raised US$68bn (22 of total equi-ty committed)The real impact of this offensive is however limited by two factors

1) only a low share of the amount subscribed is actually invested(around 20 in early 2008 for the US$15bn raised in the 3 previ-ous years according to the real portfolios detected by ANIMA) and

2) these funds often target MENA (Middle East North Africa) as awhole and do not focus solely on the MED countries

Gulf funds tend to be much larger in size than their counterparts in MEDwhile US and European funds tend to be more balanced in size 69 of MEDfunds have raised equity of under US$100m with 49 under US$50mThe UAE and especially Dubai are leaders in both size and number offunds with major PE firms such as Abraaj Capital (5 funds) Al Mal Capital(3 funds) Shuaa Partners (2 funds) Injazat Capital (2 funds) orMillennium Private Equity (2 funds) Of the Top 10 MEDMENA fundsranging from US$500m to US$2bn in equity raised 6 come from the GulfIn spite of the equity raised deals seem to rarefy in the region Accordingto the Financial Times5 ldquoMiddle East funds made 69 investments worthUS$39bn in 2007 but in 2008 only about $500m worth of deals weremade far less than the capital raisedrdquo

42 Sovereign Wealth Funds

Gulf-originated investments in MED assets have grown quickly in recentyears to the point where MED economies have often competed for a ldquofairshare of Arab investmentrdquo Initially created to stabilise Gulf economiesdependent on volatile oil prices the Sovereign Wealth Funds (SWFs) tookriskier positions when prices were booming (2006-2008) They startedlooking for investment diversification and higher returns ndash hence their rel-atively higher interest in Mashreq and MaghrebWith the recent worldwide financial crisis and the collapse of global equi-ty markets most GCC SWFs have registered significant losses This has led

44

5 Robin Wigglesworth ldquoMiddle East private equity sees lower returnsrdquo Financial Times 22January 2009

IAI Q 18 EN v2 21-06-2010 918 Pagina 44


them to abandon or reduce several projects and to consider investing athome rather than abroadDespite an estimated loss of around 30 during the crisis the GCC SWFsstill represent a considerable degree of capitalisation (Figure 10) Of theworldrsquos SWFs (assets valued at US$38117bn in October 2009) those fromGCC represent $14028bn or 368 They include the 1st 3rd 7th and 13th

most powerful funds worldwide

Figure 10 ndash The top 35 Sovereign Wealth Fund as of October 2009

UAE-Abu Abu DhabiDhabi Investment

Authority 627 1976 Oil 139 3Norway Government

Pension Fund ndash Global 445 1990 Oil 88 10

Saudi SAMA ForeignArabia Holdings 431 na Oil 11 2China SAFE Company 3471 Non-Commodity 02 2

InvestmentChina China Investment

Corporation 2888 2007 Non-Commodity 01 6Singapore Govrsquot of Singapore

Investment Corporation 2475 1981 Non-Commodity 14 6

Kuwait Kuwait InvestmentAuthority 2028 1953 Oil 106 6

Russia National Welfare Fund 1785 2008 Oil 04 5

China National Social Security Fund 1465 2000 Non-commodity nil 5

China Hong KongHong Kong Monetary 1397 1993 Non-Commodity 1 8

Authority Investment

Singapore Temasek Holdings 122 1974 Non-Commodity 07 10Libya Libyan Investment Auth 65 2006 Oil 08 2Qatar Qatar Investment

Authority 65 2003 Oil 86 5Australia Australian Future Fund 493 2004 Non-Commodity 18 9Algeria Revenue Regulation Fund 47 2000 Oil 03 1Kazakhstan Kazakhstan

National Fund 38 2000 Oil 11 6

45

Country Fund Assets Inception Origin Ratio Transpa-Name $bn to Forex rency

reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45


Ireland National Pensions Reserve Fund 306 2001 Non-Commodity 366 10

Brunei Brunei Investm Agency 30 1983 Oil 1France Strategic Investment

Fund 28 2008 Non- Commodity 02 NewSouth Korea Investment Korea Corporation 27 2005 Non-Commodity 01 9US-Alaska Alaska Permanent Fund 267 1976 Oil 05 10Malaysia Khazanah Nasional 25 1993 Non-Commodity 03 4Chile Social and Economic

Stabilization Fund 218 1985 Copper 09 10UAE- InvestmentDubai Corporation of Dubai 196 2006 Oil 18 4UAE-Abu MubadalaDhabi Development Co 147 2002 Oil 03 10Bahrain Mumtalakat Holding

Company 14 2006 Oil 29 8UAE-Abu Intrsquoal Dhabi Petroleum

Investment Co 14 1984 Oil na naIran Oil

Stabilisation Fund 13 1999 Oil 02 1Azerbaijan State Oil Fund 119 1999 Oil 06 10US-New New Mexico Mexico State Investment 117 1958 Non-Commodity 02 9

Office TrustCanada Albertarsquos

Heritage Fund 111 1976 Oil 04 9Nigeria Excess

Crude Account 94 2004 Oil 02 1New New ZealandZealand Superannuation Fund 86 2003 Non-Commodity 08 10Brazil Sovereign Fund of Brazil 86 2009 Non-commodity nil newOman State General

Reserve Fund 82 1980 Oil amp Gas 03 1

Total (including 16 smaller funds)38117

Source SWF Institute Linaburg-Maduell Transparency Index

The difference between Sovereign Wealth Funds and purely private GCCinvestors lies in their vision of national interests and not solely of returns Thisis clear for instance for Mubadala or Dubai Investment Corp from theEmirates which support the Emiratesrsquo strategy of upstream industry diver-

46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46


sification (e g aluminium a by-product of UAE cheap energy or logisticsalongside the global ambitions of Dubai Port World or the Emirates airline)This is confirmed by the 2009 World Investment Report (UNCTAD)According to the WIR the recent oil price boom ldquoled some SWFs to adopta new approach using part of their financial surplus to invest in industriesthat their governments perceive as particularly relevant for the develop-ment and diversification of their national economies This led the moreproactive SWFs to seek greater involvement in managing the companies inwhich they invested Mubadala for instance created in 2002 has over thepast few years used its assets to develop a network of international anddomestic partnerships in numerous industries including energy automo-tives aerospace real estate health care technology and infrastructure andservices These are industries that benefit the United Arab Emiratesrsquo over-all economic development objectives For example in acquiring a 5 stakein Ferrari in 2005 it improved the potential for increased tourism in AbuDhabi in the form of the Ferrari theme parkrdquo

43 Islamic Finance and Charities

The ANIMA FDI observatory has noticed a strong growth in Islamicfinance in recent years (1 project in 2004 2 projects in 2005 15 in 20067 in 2007 9 in 2008) Of these 34 projects being conducted in MED coun-tries 28 originate in the GCC 11 from Kuwait (euro802m) 6 from theEmirates (euro85m) 4 from Qatar (euro123m) 4 from Bahrain (euro629m) and 3from Saudi Arabia (euro36m) Around half of them deal with insurance 16are branches 9 are JVs 7 are acquisitions and only 2 are greenfields (cre-ation of an entirely new business)As regards charities a few investments have been generated by non-profitNGOs such as the Aga Khan Fund (3 projects in Syria especially in micro-finance or in the renovation of a prestigious hotel in Old Damascus) or theAl Waleed foundation (projects in Egypt and Lebanon) Other projectshave a heritage or environmental dimension (restoration of medinas muse-ums etc) but are integrated into wider profit-based venturesIt is obvious that in the Mediterranean as in the rest of the world businessopportunities and returns remain the primary purpose of investmentWhile certain investment projects are launched for reasons of political pres-tige or in the name of Arab solidarity the business presence of Gulfinvestors in the Mediterranean seen as a booming and lucrative market isfundamentally profit-oriented

47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47


5 MED Trade Relationships with the GCC and the EU

Trade patterns between MED countries and Europe or the Gulf resembleFDI patterns Overall the MED countries are tied to the EU mainly fortheir exports (almost 50) and to a slightly lesser degree for their imports(40) The GCC bloc represents only around 3 of both exports andimports but is significant for the Mashreq countries (exports from JordanLebanon and Syria) North America absorbs a good share of Algerian Israeliand Jordanian exportsThe Maghreb has a strong trade focus on Europe this is especially true forTunisia and Morocco less so for Algeria Trade relationships with the Gulfare very limited The Mashreq conversely is less dependent on the EU forits trade with Jordan Egypt Syria and Lebanon in particular relying moreon the GulfIntra-MED trade is extremely limited The MED trails other economicblocs in this respect despite a recent positive trend (Figure 11) Althoughsignificant efforts have been pursued during the last 5 years to reduce tradebarriers among MED countries (bilateral agreements signing of the AgadirAgreement in 2004 between Tunisia Morocco Egypt and Jordan) a lotremains to be done Trade between the Agadir or Arab Maghreb Union sig-natory countries remains low Narrow local markets prevent local SMEsfrom specialising their industry and thus becoming competitive in regionaland international markets

Figure 11 ndash Intra-bloc exports as a share of total exports among prominentregional integration agreements

Economic bloc 2000 2005 2007

Intra-MED trade 45 62 69

PAFTA (Pan Arab FTA) 72 99 106

ASEAN 23 253 252

MERCOSUR 164 11 128

SADC (Southern Africa) 95 93 101

Source World Bank IMF

Finally for strategic reasons of energy and security trade relationshipsbetween the EU and GCC are not totally exempt from difficulties and dis-

48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48


trust In 2007 EU-GCC trade amounted to US$105bn (vs $275bn for EU-MED trade $21bn for MED-GCC trade and $40bn for intra-MED trade)EU imports from GCC are mainly hydrocarbons while its main exports toGCC are transport equipment and machinery from cars or aircraft todesalination plants Both parties have experienced a long history of stop-gorelationships with the 1988 Cooperation Agreement still pending for thefull implementation of a free trade area

6 Existing MED-EU-GCC Cooperation

In terms of economic relationships a MED-EU-GCC triangle seems high-ly logical as it mixes

ndash The know-how technology savings surplus and labour needs of Europendash The human and natural resources but also the gaps in the infrastruc-

ture social provision and consumption of MED countriesndash The energy financial resources and the need for secure investments

and a safe environment on the part of the Gulf StatesThe above analysis shows that this triangle ndash similar to that of Japan-China-ASEAN but by no means as well-integrated ndash already exists as a reality forbusiness operators However it is rather unbalanced (see Figure 12) and stillseems far from an organised cooperation playing field Furthermore the tri-angle has a strong side (EU-MED) an average side (EU-GCC) and a rela-tively weak side (MED-GCC)The main reasons explaining the failure to fully achieve this cooperation(and thus the lack of synergies) are

ndash The huge cultural differences not only between Europeans and theirSouthern and Eastern neighbours but also and maybe even more betweenNorth-Africans and ldquoArabsrdquo (as the Gulf population is designated in Maghreb)

ndash The large imbalances in demographics migration policies humanrights and the social contract (EU resistance to migration Gulf netimporter of labour two-level citizenship etc)

ndash The mistrust ndash hidden to varying degrees but sometimes open ndash shownby the stakeholders (expressed for instance in the refusal to accept certainGulf investments in Europe similarly MED countries sometimes reject Gulfoperators perceived as having benefited from overly favourable deals)

ndash The lack of MED willingness to pursue political and economic integra-tion (compared with the EU and GCCrsquos achievements andor efforts tocreate a Customs Union a possible common currency etc)

49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49


Figure 12 ndash Imbalances in triangular EU-MED-GCC economic relationships

FDI and trade flows are not represented at the same scale

Given this context it is clear that EU-MED-GCC relationships are notoptimised

ndash The EU still the major investor in and donor to the MED countries isnot playing its expected role in full there is limited private investment(except from the Latin countries) atomisation of aid in narrow bilateral pro-grammes (at the wish of the MED countries themselves) a lack of EU visionand political will (most MED countries perceived the ldquonew neighbourhoodrdquopolicy as a downgrade) and above all insufficient structural funds for realconvergence (less than euro100 per capita since 1995 for the MED populationof 270 million vs euro1000 per capita over 5 years for the 8 central EuropeanStates who joined the Union in 2004) The Union for the Mediterranean(UfM) is a positive (though awkward) attempt to resuscitate the dormant(but technically efficient) Barcelona process with the high risks of politicalobstruction partly mitigated by the primacy given to projects

ndash A complicated psychological game is played out in Gulf-MED rela-tionships the relative contempt of rich oil producers as against the pride of

50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50


their MED counterparts From 2003 to 2007 the multibillion projectspouring into the Maghreb were warmly welcomed by local decision-mak-ers ndash who can resist mega-projects in countries suffering from unemploy-ment and a lack of productive capital The best pieces of land and the mostprofitable operations were offered Since then the failure to completesome projects the feeling that urban heritage natural land facilitieslicences plants and other opportunities were given to foreigners and thecounter-lobbying of some national competitors have altered the balance offorces Financial crises can be a good occasion for an in-depth revision ofonce idyllic relationships Closer to the Gulf and more integrated in its hin-terland the Mashreq did not experience such disappointment Officiallycooperation continues all over the Arab MED countries but in practice thesignals sent out by the companies concerned translate into a much morecautious attitude on both sides

ndash The EU-GCC relationship is plagued by the non-signing of the long-expected FTA agreement Each party needs the other in order to becomepartners Trade has still increased in volume in recent years (but less rapidlythan Asian-GCC trade) Hindered by its stringent requirements (region-to-region dialogue mirroring EU concepts human rights removal of all tradebarriers) the EU is losing ground to China India and ASEAN Politically EUdecision-makers have difficulties in considering GCC as an equal partnerrather than a mere oil supplier The same risk exists in the case of trilateraleconomic cooperation ndash reducing the Gulf to the simple role of financierwithout seeing (for instance) its major strategic role of bridge to Asia (theformer route to India) The shadow of Uncle Sam more pragmatic andquicker to decide makes European strategy even more difficult to defineand implement (see for instance the EU reluctance vis-agrave-vis the GreaterMiddle East initiative of former President Bush leading to the non-integra-tion of the Gulf in the UfM process despite French attempts to include it)

7 Three Proposals for an Improved Euro-Gulf-MED Relationship

71 Building Confidence via a Permanent Dialogue Platform

Confidence is most certainly the element missing for the creation of a tri-lateral environment delivering all the expected synergies Western institu-tions (World Bank OECD) have designed instruments to measure realbusiness conditions and the status of reforms (Doing Business etc)

51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51


Remarkable progress has been achieved in implementing the rule of lawprotecting investors property rights etc (in Egypt for example ldquobestreformerrdquo in 2007) However the innermost feeling of numerous operators(for example in Northern Europe where business applies more stringentstandards) is that they would prefer not to enter the market until the rulesof the game are totally fair and applied in fullIn this field provided it is followed by concrete action on the ground thepolitical message could be decisive One proposal could be to launch a per-manent MED-EU-GCC dialogue aimed at closing the economic dividebetween the 3 regions The ASEM (Asia-Europe Meeting) ndash an informalprocess of dialogue and cooperation bringing together EU-27 the EC 16Asian countries and the ASEAN Secretariat6 ndash could serve as an exampleThe idea is to create synergies through enhanced inter-regional linkagesspurring the further economic growth of the regions concerned and usingminister-level meetings to exploit this potentialMaking a better world from the three economic sets represented by EUMED and GCC would imply making the problems of some a solution for oth-ers This seems possible for instance in terms of satisfying the social needsof the MED population (housing public transport water managementetc) which may generate markets for EU or GCC suppliers looking forgrowth ndash provided that a viable business model can be implemented Thefuture shortage of workers in Europe or the savings surplus in the EU (andeven more in the GCC) correspond to an excess of workers in MED coun-tries ndash also looking for investment The current gap in GDP per capitabetween the two rims of the Mediterranean is not good either in businessdevelopment or in security terms That is why economic convergence is a pri-ority and a win-win game for all parties concerned

72 Developing SMEs

Convergence cannot happen without the massive creation of value-added activ-ities in MED countries in the next two decades (the period when the most pop-ulous young generations will enter the job market pressures will subsequent-ly decrease) 3 to 5 million jobs will be offered each year in the MED region(which currently has 270 million inhabitants)The ANIMA observatory shows

52

6 The ASEM dialogue addresses political economic and cultural issues with the objective ofstrengthening the relationship between these regions in a spirit of mutual respect and equalpartnership See httpwwwaseminfoboardorg

IAI Q 18 EN v2 21-06-2010 918 Pagina 52


that FDI creates around 100000 direct jobs per year and maybe 2 or 3times more indirect jobs This is not sufficient If the MED countries are torapidly close their gap with Europe this cannot be achieved solely throughpublic projects (though catalyst projects such as Tanger-Meacutediterraneacutee orglobal internet coverage are necessary) or through the mega- or regularprojects developed by transnational companies from Europe or the GulfMost of the job creation will come from the informal sector (hence theimportance of microfinance) and from SMEs

ndash Existing SMEs to be reshuffled and reorganised so that they may growbe internationalised and ndash for the best of them ndash be transformed into largecompanies this is a domain to be addressed by professional networkscoaching or capacity building (limitations of this method notwithstanding)and private equity funds

ndash SMEs still to be established in these new services- and ICT-relatedfields These start-ups cover a wide range of activities from franchises orbusinesses transferred by diaspora entrepreneurs to hi-tech companies orJVs with foreign partners Financing is a major obstacle for most of theseventures which generally cannot provide collateral guarantees and are out-side the scope of private equity funds (equity gap under US$2 million)The EIB and the UfM are currently studying a Mediterranean BusinessDevelopment Initiative which could lead to the creation of instruments suchas an SME agency new guarantee schemes funds for microfinance or seedcapital etc (and later on a more ambitious Development Bank) Theseimprovements are welcome provided they find a practical route for imple-mentation The challenges are numerous donors (EIB WB AfDB SWFs)are talking billions but investments of this scale would rapidly saturate astill limited SME market In addition there is a need for action at the grass-roots level to establish connections with the 20 million (or more) MEDSMEs This implies implementing a full transformation chain (major insti-tutions - banks - funds of funds - branches - investment offices - local fundsetc) Another challenge is to make capital available at an acceptable cost(due diligence to lower costs) This in turn implies training investmentbankers all over a region where commercial banks have little engagementin industry financing and where mature capital markets seldom exist(scarce outputs lack of instruments such as forward currency coverageweak stock exchanges etc)The challenge is also technical The need is to improve projects and gener-ate a flow of thousands of yearly projects to be submitted to banks there-by multiplying the incubators clusters technoparks and networks where

53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53


nascent companies can be nurtured informed coached and internation-alised The SME challenge in MED countries can be compared to a soccermatch where two teams (the entrepreneurs and the investors) cannot real-ly meet because the playing field does not yet exist This type of platform(information matchmaking) is precisely what the Invest in Med pro-gramme is proposing to the MED Business Development InitiativeThis is an area where EU GCC and MED countries could co-operate Overand above finance the potential added value from the Gulf partners (notreally strong in terms of SME experience) lies in the complementaritiessuggested by their industrial positioning (e g logistics aluminium chainniche tourism etc)

73 A Sustainable Investment Charter for the Mediterranean

Over the centuries North Africa Southern Europe and the Middle Easthave woven a complex fabric of cultural economic and political relationsThe development of physical infrastructure will further strengthen theselinks (power grids telecommunications pipelines trans-Maghreb motor-way projects for a bridge between Egypt and Saudi Arabia and for a tunnelunder Gibraltar) So too will the advent of a tentative greater Euro-MENAfree trade area Until these are completed cross investments (private equityforeign direct investment or sovereign holdings) provide a strong means to bindthese 3 blocs in the long term while fostering the material convergence oftheir economic interestsThe considerable Gulf investments in MED countries have created anopportunity for a real lift-off However the frequent choice of rent sectorsrepresents a risk absorption capacity is limited the crowding-out effectswhich affect local operators may feed resentment towards foreign interestsrapid urbanisation and the establishment of polluting industrial facilities ormega-resorts on the Mediterranean seashore involve significant environ-mental risks The unbalanced economic development which is currentlytaking place may generate a hidden cost for the communityA major positive step forward would be for all to work together - EU GCCand MED beneficiaries - on a sustainable investment charter for theMediterranean Improving the quality of FDI is essential in a fragile eco-sys-tem -a closed sea or the overcrowded strip occupied by most Southerndwellers where many cities number their population in millions MED gov-ernments would be entitled to maximise the positive impact of FDI interms of local content sustainability or social care in exchange for the pref-

54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54


erential treatment often granted to investors (land at low prices tax exemp-tions etc) This is more or less the approach followed by the developmentbanks (EIB WB etc) in the projects they support mainly in major infra-structure The challenge would be to generalise this concern for sustainabil-ity and social responsibility to all projects public and private big and smallin order to make the Mediterranean a pilot area at world level for exem-plary long-term and balanced developmentIn conclusion if full participation by the Gulf in the two pillars of the UfMprocess (the political secretariat and the Union for projects bringing togeth-er pioneering groups) might seem difficult at the moment it would beinteresting to offer the GCC a partnership based on the second pillar (proj-ects with variable geometry) A reasonable share for the Gulf States of thecapital of the future Mediterranean Development Bank would be a perfectillustration of concrete cross interests

55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56

The Mediterranean is expected to play an increasingly important role inglobal energy flows in the coming decades European oil imports fromRussia Central Asia and North Africa look set to increase against a back-ground of overall stagnation in Europersquos oil consumption This could meanthat smaller but still considerable volumes of oil from the Gulf wouldenter EuropeFor natural gas Europersquos desire to diversify from what is perceived as anexcessive dependence on Russia would play into the hands of Gulfexporters of liquefied natural gas (LNG) among others at a time whensupplies from the countries of the North African coasts are expected to bestable if not declining Prospective pipelines linking the Gulf to Europewould notably strengthen their gas supply tiesImportant potential synergies exist between Europe and the Gulf in thedevelopment of renewable energy sources especially solar and wind ener-gy and in the investment required to meet domestic electricity demandwhich is growing very rapidly in every Gulf country The Gulf States havebeen seeking innovative technologies for power generation including coaland nuclear energy with the aim of leaving their oil for export and theirscarce natural gas for petrochemical feedstock use

57

The views expressed in this chapter are those of the author and do not represent those ofQatar Petroleum where he is currently working

3 ENERGY IN THE MEDITERRANEAN

AND THE GULF

OPPORTUNITIES FOR SYNERGIES

Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad

1 Crude Oil amp Refined Products

Most projections about oil supplies over the next two decades suggest that therole of the Organisation of Petroleum Exporting Countries (OPEC) willincreaseThis applies most notably to the Gulf suppliers which include the sixmember countries of the Gulf Cooperation Council (GCC) namely BahrainKuwait Oman Qatar Saudi Arabia and the United Arab Emirates (UAE)However a detailed analysis reveals considerable disparities especially asregards how rapidly and to what extent increasing supplies from the Gulfwill be needed or actually observed Future oil supply and exports from theregion will be shaped not only by global oil demand and the strategies ofconsuming countries but also mdash and perhaps more significantly mdash byfuture oil supplies from other sources including Russia Central Asia WestAfrica and other non-Gulf OPEC countries such as Nigeria VenezuelaLibya and AlgeriaMany other key factors are likely to affect the prospects for oil supply andexports from the Gulf These include proven reserves undiscoveredresources supply costs oil prices government policies and industrial devel-opment And most notably the level of investment made not only toexpand production capacity and export infrastructure but also to maintainthe existing standardsThe huge oil reserve base in the Gulf is a well-known fact of the globalpetroleum industry According to the latest issue of the BP StatisticalReview of World Energy the six GCC countries contain immense provenreserves of crude oil estimated in early 2009 at around 498 billion barrelsThis represents about 40 of all global reserves while the regionrsquos popula-tion represents less than 1 of the worldrsquos total The average reserves-to-production ratio for Gulf oil a measure often used as an indicator of near-term supply capacity was estimated in 2008 at 73 years compared with aglobal average of 42 yearsWhen evaluating the undiscovered petroleum resources in the region theUnited States Geological Survey (USGS) the only public source estimat-ing these resources around the world argued ndash through its latest figuresreleased in 2000 ndash that the GCC has an undiscovered crude oil potential ofsome 162 billion barrels (mean) or around 17 of the worldrsquos totalOil development and production is a relatively cheap undertaking in theGulf which has the lowest average production cost in the world Likewisethe investment required to raise oil production capacity in the region is much

58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58

Energy in the Mediterranean and the Gulf Opportunities for Synergies

lower than in many other parts of the world although it has been growingsteadily in recent years necessitating considerable amounts of capitalMoreover every GCC country enjoys free and unrestricted access to theopen sea with an extremely well-developed export pipeline infrastructurelinking oil and gas fields and reservoirs with petroleum marine export ter-minals and loading platformsIn contrast to these positive factors the GCC share of global oil production(less than 23 in 2008) is much lower than its share of world total reservesOil reserves in the Gulf have been underexploited when compared withthose in North America Europe and Russia This state of affairs shows nosign of changing although there is little doubt that the existing reserve basein the Gulf would allow for much higher production levelsHowever basing an extrapolation of future Gulf production and exports onreserves geology and production potential is fundamentally wrong And bas-ing the extrapolation on production trends in recent years is equally incorrectThat was shown recently during the 2003 war in Iraq when Saudi Arabiaalone increased its production by close to 25 million barrels per day mdash equalto the total production level that the Caspian region is now yielding after 20years of lengthy negotiations and billions of dollars of investmentGCC producers face strong competition in the oil markets of the EU fromRussia Central Asia and Iraq and especially from Mediterranean produc-ers notably Libya and Algeria In fact the rapid development of NorthAfrican petroleum resources following the recent political deacutetente withTripoli has helped alleviate Europersquos competitive weakness in securing ade-quate imported oil (and gas) suppliesEuropean oil imports from Russia Central Asia and North Africa are thusexpected to increase against the background of an overall stagnation inEuropean oil consumption This may mean less oil from the Gulf cominginto Europe Gulf oil would rather be directed primarily to the emergingeconomies of Asia whose demand is set to increase rapidly and to NorthAmericaThus the EU-GCC oil trade is clearly influenced by three main factors

ndash oil reserves in the GCC are exploited less intensively than in other oil-producing countries as manifested by the fact that the Gulfrsquos share in globalproduction is much lower than that of its reserves (23 as opposed to 40)

ndash the EU is the preferred destination for oil from Russia Central Asiaand North Africa primarily for logistical considerations while Gulf oil ismostly directed to Asia and North America and

59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad

ndash the EU is diversifying its primary sources of energy relying relativelyless on oil and more on natural gas and coalThese factors have limited the direct European dependence on Gulf oilexports But considering that the market for oil is global the EU will stillbe reliant on GCC oil production and exports albeit indirectly because thelatter are essential to the orderly functioning of the global oil market andbecause the Gulf producers are marginal suppliers of world oilIn the case of refined products the push by many GCC countries to buildnew oil refineries in the region has been hit by delays soaring costs andgloomy prospects for demand The Gulf States have had to go back to thedrawing board for a number of projects and revisit their plans But so farnone of the many new refineries planned for the area has been scrappedDespite fears that the recent economic and financial crisis and the ensuingrecession are eroding demand growth GCC national oil companies areindeed continuing with most of their downstream expansion plansThere is a need to better understand which portion of the increase in Gulfrefining capacity has been directed to exports and to which destinationsThe GCC should perhaps synchronize its export-focused refining capacitywith expected needs in consuming countries including in the Europeanmarkets This issue could be of significant interest and an area for discus-sion and coordination between the EU and the GCCTrade in crude oil and refined products between the GCC and the EU willcontinue to be of decisive importance to the volume and direction of oilflows to and through the Mediterranean GCC oil flows beyond Europe(especially to North America) are also impacting the transit role of theMediterranean Whether it is in the best interests of Mediterranean coun-tries to have their sea used for long-haul oil transit to serve the NorthAmerican market remains an open questionIn view of the accidents that have occurred involving maritime hydrocar-bon transportation and the particular vulnerability of the MediterraneanSea the already heavy maritime oil transport across the sea and its straitsexpected to further increase in the future is causing serious concernIndeed concerns are routinely expressed regarding the vulnerability of thepassage through the so-called ldquodire straitsrdquo which in turn has led to severalproposals for by-passes and alternative logistical arrangements and in par-ticular for a reduction in oil flows through the Strait of HormuzOne option if it is shown to be technically economically and environmen-tally feasible would be to consider reducing maritime oil transportation in

60

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the Mediterranean by developing pipelines Indeed the EU has alreadyexpressed a desire to reduce dependence on tanker transport of oil acrossthe Mediterranean and instead encourage a greater use of pipelinesNevertheless all these export outlets and supply and logistics chains remainvulnerable and highly exposed a fact that is attracting growing attentionespecially when taken with actual or perceived geopolitical factors andsecurity threats All these factors could lead to a cooperative EU-Gulfapproach towards building strategic stocksIn the Gulfrsquos oil-producing countries the potential for carbon capture andsequestration (CCS) is very significant CCS appeals to GCC hydrocarbonproducers whose existing petroleum fields offer an excellent opportunityfor carbon storage with the added advantage that the injection of carbondioxide (CO2) is also a form of enhanced oil recovery (EOR) used in theageing oil fields in the regionThe impact of CCS on the establishment of energy-intensive industries forwhich proximity to fields that facilitate storage is desirable is very impor-tant especially in the industrial development process Interest in CCS alsomeans that GCC countries should develop a strong awareness of the EU-sponsored market for carbon rights and the recognition of CCS as anaccepted form of emission reduction This translates into tradable CertifiedEmission Rights (CERs) under the Clean Development Mechanism(CDM) of the United NationsGCC producers could collaborate fruitfully with the EU to develop CCS-related actions such as promoting projects for CO2 infrastructure develop-ment at the national level or building up CO2 storage sites and pipelines formulti-user accessThe potential for CDM projects in the GCC countries couldbe a good candidate for inclusion under the umbrella of EU-Gulf synergies

2 Natural Gas

The Gulf region enjoys a large gas resource base especially when comparedwith its current and foreseeable level of demand While the area has histor-ically played a marginal role in world gas markets (mostly in the South-EastAsian markets) its growing potential as a major international gas region hasbeen increasingly recognisedThe GCC holds huge proven natural gas reserves which BPrsquos StatisticalReview of World Energy estimated in early 2009 at an aggregate figure of

61

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Naji Abi-Aad

43120 billion cubic metres This accounts for around 23 of the worldrsquostotal A major portion of these reserves is concentrated in a small number ofgiant fields a factor that makes the development of structures easier andcheaper Nevertheless the size of proven gas reserves differs widely from oneGCC country to another from 90 billion cubic metres at the lower end of thescale in Bahrain to 25460 billion at the higher end in Qatar Here they aremostly located in the North Field the worldrsquos largest non-associated gas fieldIn the GCC the average reserves-to-production ratio for natural gas isextremely high estimated at around 169 years in 2008 compared with aglobal average at the time of 60 years It is also interesting to note that thetotal proven reserves of natural gas in the region as estimated in early 2009are sufficient in themselves even if no further discoveries were made tosatisfy current worldwide gas demand for more than 14 yearsHowever most of the proven gas reserves in the GCC ndash with the exceptionof those found in Qatar ndash are in associated form found and eventually pro-duced together with oil Natural gas output in these countries is thus close-ly linked to that of crude oil That leaves in the GCC only Qatar with ahuge scope for expanding gas output and exportsWhen looking at the potential resources in the Gulf most of the analystsworking on the region believe that enormous resources of natural gas are stillto be discovered there considering that the emphasis has historically beenon oil exploration and that natural gas reserves in the area have to a largeextent been underestimated The USGS reported in 2000 that the totalundiscovered gas resources in the six GCC countries amount to around23309 billion cubic metres (mean) or nearly 16 of the worldrsquos totalConsidering the enormous potential of natural gas in the Gulf little hasbeen done so far to exploit its reserves Gas production in the GCC is stillof minor importance when compared to the regionrsquos reserves and outputpotential Gas production in the area represented just 83 of the worldrsquostotal in 2008 when the region exploited only 06 of its gas reserves com-pared to a global average of 17 Therefore the growth of the gas indus-try in the Gulf can be considered to be still in its early stagesGrowing domestic gas consumption in the GCC has partly driven thedevelopment of gas production there but only exports to the major con-suming zones will allow the regionrsquos vast reserves to be fully utilised andvalorised Moreover growing local gas demand in the area will in no wayhinder the capacity of the Gulf to export increasing volumes of gas to theinternational markets

62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62


In 2008 the GCC had a still marginal share (around 92 per cent) of theinternational gas trade mainly comprising LNG exports from Qatar Omanand Abu Dhabi to European and especially Asian markets and piped vol-umes from Qatar to the UAE and Oman (through the Dolphin pipeline)The GCC share of the international LNG trade was around 26 withQatar accounting for nearly 68 of the gas exported from the regionThe GCC and especially Qatar is keen to play a key and growing role inregional and international gas markets in the near future Indeed Qatar hasa firm determination supported by vigorous and dynamic policies toexpand its natural gas exports The country is also blessed with low produc-tion costs and a strategic geographical location in relative proximity to themajor markets of Europe and Asia Consequently Qatar already the worldrsquoslargest LNG exporter will see its annual LNG exports increasing fromaround 40 million tons in 2008 to some 77 million tons by late 2010In the other GCC LNG producers namely Abu Dhabi and Oman the lackof gas feedstock due to modest non-associated gas reserves and growingdomestic demand has led to the under-utilisation of their gas liquefactionplants a situation that is not likely to change in the futureAlthough there is no doubt that the GCC will play a growing and crucialrole in regional and international gas markets its gas exporters have manychallenges to face especially the medium- and long-term impacts of therecent global economic and financial crisis on gas demand and pricesIn addition natural gas has been suffering from the emergence of compet-itive energy sources such as unconventional gas the development of whichis rapidly spreading from its strong base in the United States to Europe(Germany) Asia (China and India) and Australia and from the develop-ment of clean coal technologies that would exploit to better effect the hugecoal reserves found all around the worldMeanwhile the Gulf has been facing growing competition from other LNGdevelopers especially from within Asia its main LNG market That rivalryis likely to become intense The aim is to secure the earliest possible placein the Asian gas market and to ensure that projects are not delayed bear-ing in mind that long-distance gas pipelines will also eventually be compet-ing with LNGFacing all these actual and potential problems Gulf expansion goals havefocused on oldnew opportunities in Asia The Gulf is confident that Asiawill remain for decades its main gas export market especially as only partof the energy demand resulting from growing economic activity in the

63

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Naji Abi-Aad

region has so far been met by natural gas Gulf gas producers have alsofocused on European marketsIn the EU the medium- and long-term energy outlook points to an increasein demand for natural gas a growth that would however be much lowerthan that seen in the region during the past three decades Some analystseven believe that the growth in European gas demand is far from certainIn fact the increased demand for gas for power generation which is themain driving force behind the steep rise in European gas consumptioncould well be challenged by coal especially if an environment-friendly coaltechnology became widely available and if gas prices followed those of oiland rose to and stayed at relatively high levelsThat said there is little doubt that the EU countriesrsquo main existing exter-nal gas suppliers namely Russia Norway and Algeria will continue to meetmost of Europersquos increasing demand and remain the main pillars of natu-ral gas supply to the region Indeed these gas exporters are already tied tothe European market by transportation infrastructure notably pipelineswhich are currently in the process of being expanded They therefore enjoya very significant advantage in satisfying additional European demand It ismuch easier to increase the capacity of an existing pipeline than to buildone from scratch And it is much easier for an established supplier thatalready has sales in a market to decide to build an entirely new pipelinethan it is for a new supplier with no market share at all to build its firstpipeline New gas suppliers will thus have substantial barriers to overcomebefore acquiring weight in the EU gas marketWhile taking these factors into consideration the EU is firmly intentioned todiversify its gas supply sources A recent communication by the EuropeanCommission on the security of gas supply underscores the political will thatexists to enhance the prospects for gas trade with new suppliers including theGulf countries In that communication the Commission clearly declared thatthe EU has a common interest in continuing and deepening the developmentof strategic relations with external suppliers and transit countries in order tomitigate both political and technical risks associated with future supplies andto ensure that multiple import pipelines exist to supply EuropeIn fact diversifying LNG supply sources and connecting other producers tothe European gas network must be made priority objectives because ifmatters were left to the market the almost certain outcome would simplybe an increasing reliance on consolidated suppliers in the short- and evenlong-term However the end result would be a tightly knit oligopoly with

64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64


resulting relatively higher prices almost cancelling out the positive effectsof the under-established competitive gas market in the EU Europe wouldbecome even more dependent on just three countriesNew and prospective gas exporters to Europe include in particular theGulf producers especially Qatar but also the Central Asian countries fromwhich several pipeline projects (such as Nabucco) are being consideredOther suppliers are Mediterranean producers such as Libya and EgyptLibya which is already linked to the European gas network through theGreenStream pipeline to Italy could see its gas exports growing in thefuture if additional gas reserves were found and developed in the countryThis would also lead to increased LNG exports from its liquefactionplantIn Egypt where two liquefaction plants are already supplying Europeanmarkets with LNG and which is the starting point for the Arab GasPipeline (AGP) supplying the eastern Mediterranean Arab countries(Jordan Syria and Lebanon) serious doubts have been raised over thecountryrsquos medium- and long-term gas export capabilitiesEgyptian gas reserves are relatively modest compared with the countryrsquos gasexport plans and its rapidly growing domestic needs and the government isstrongly encouraging the use of natural gas in place of petroleum productsin almost every economic sector This recently led Cairo to prioritise theallocation of natural gas for domestic use and industry over that destinedfor exports by imposing a moratorium in mid-2008 (for an initial two-yearperiod) on new gas export deals This situation would only change if majornew gas reserves were discovered in the countryReturning to the Gulf while increasing its LNG exports to Europe maywell contribute to the diversification of EU gas supplies a more competi-tive European gas market requires the establishment of physical pipelinelinks with the GCC These could be either direct or use connections withthe various existing and planned gas pipelines around the Mediterraneansuch as the AGP and Nabucco Indeed it is extremely important for theholders of the Gulfrsquos large gas reserves to build strong physical links withone of the worldrsquos main markets for natural gasA salient feature of all pipeline projects from the Gulf to Europe is thatthey must first cross through Turkey Turkey is also the essential bridge formany gas export schemes from other countries or regions all ultimatelyaiming at reaching the EU market Turkey is also - in and of itself - a rapid-ly growing and important gas market

65

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Naji Abi-Aad

With respect to LNG transit it is important to emphasise the central roleof Egypt and the Suez Canal which has to be transited by every Gulf LNGcarrier to Europe If Gulf LNG headed for the United States were also totransit the Mediterranean LNG shipments of 40-60 billion cubicmetresyear across the Suez Canal and the Mediterranean could easily beenvisaged by 2020 These volumes could reach 100-150 billion cubicmetresyear by 2030

3 Power amp Water

Many GCC countries are still at a stage of development where rapid GDPgrowth translates into large increases in the demand for electricity anddesalinated water As economic development proceeds increased urbaniza-tion and industrial expansion will lead to even higher demand for thesevital products estimated to grow at an average annual rate of 7 over thenext 15 yearsAs a result power generation and water production capacity in the region isexpected to more than double within the next 12-15 years The additionalpower generation capacity for the period 2007-11 alone some 14 gegawatts(GW) above the current estimated level of 65GW translates into a 5-yearcumulative investment of about US$25 billion Over the next decade SaudiArabia alone will invest around US$80 billion in expanding its power gen-eration and transmission sector All of this would open the door wide foropportunities for EU involvement in Gulf power investment in capitalterms either as Independent Power Producers (IPPs) or in other forms or bytransferring the latest power technologies This applies not only to electrici-ty generation but also to power transmission and interconnectionOne power generation technology being researched by the Gulf countriesis nuclear energy By looking at ways to establish a nuclear component totheir power generation fleet GCC countries aim to leave oil for export andnatural gas (which is in deficit in many countries in the region) for petro-chemical feedstock useIn the nuclear energy field Europe is obviously a potential technologicalpartner The EU has significant competences in the nuclear field derivingdirectly from the EURATOM treaty Thus nuclear energy offers a clear andimportant if delicate area for cooperation between the EU and the Gulfnot only in power generation but also in water desalination

66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66


Indeed according to the World Nuclear Associationrsquos website small- andmedium-sized nuclear reactors are also suitable for water desalinationthrough the use of low-pressure steam from the turbine and the hot seawater feed from the final cooling systemClean energy technologies especially those related to the economic andefficient use of coal in power generation and water desalination could pro-vide another area of synergy between the Gulf and the EU where manycountries have been using coal for centuries and are now developing clean-er technologies for its use Indeed with some countries in the Gulf experi-encing constraints in gas supply there has been a tendency to think of coalas an alternative fuel for firing their new power plants This is especiallytrue for Oman and to a lesser extent for Abu DhabiIn the field of power transmission and interconnection the benefits ofinterconnecting national electricity networks have been positivelyappraised in the GCC and as a result a regional grid is currently beingestablished However the limited surplus of generating capacity currentlyavailable and the fact that peaks in member countries tend to coincide willmake it difficult to fully exploit the benefits of a GCC power gridNevertheless power interconnections are envisaged beyond the GCC itselfwith other Middle Eastern and North African countries thus potentiallyestablishing a continuum of interconnection from the Gulf to Europethrough the Mediterranean electricity ring Together with the improvedability to transmit electricity over longer distances conditions would becreated under which centrally located generating capacities could servealternative markets situated throughout the ring exploiting hourly or sea-sonal differences in peak load demand In such a field of power transmis-sion and interconnection opportunities for synergies between the GCCand the EU most surely exist

4 Renewable Energy Sources (RES)

An awareness of the potential for renewable energy sources (RES) espe-cially solar and wind energy is growing rapidly in the Gulf As a conse-quence the prospects for technological industrial and policy cooperationwith the EU are considerableGCC countries have studied and developed interesting initiatives regardingthe development and promotion of RES Saudi Arabia has been working on

67

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Naji Abi-Aad

a plan to become a major centre for solar energy research and subsequent-ly a major megawatt exporter Masdar City the US$15-billion future ener-gy initiative in Abu Dhabi where the headquarters of the UNrsquosInternational Renewable Energy Agency (IRENA) are now located is to bethe worldrsquos first carbon-neutral waste-free car-free city depending com-pletely on renewable energy and re-used water Other related activities inthe Gulf hinge on research or pilot programmes such as the use of solarenergy for desalinating water the development of advanced photovoltaicsystems the use of wind power for pumping water and generating electric-ity and the establishment of RES mapsThe use and development of RES based on the specific potential of theGCC (in particular solar and wind energy) could make a significant contri-bution to environmental protection on a regional and global level andcould indirectly help guarantee oil and gas supplies from the region At thesame time the GCC countries have an opportunity through RES applica-tions to support the development of many of their remote towns villagesand settlementsFor these purposes the GCC may well need to introduce and develop instru-ments for the growth and expansion of RES in its member countries The EUhas developed such instruments to a significant degreeThey take the form ofprice-based mechanisms (feed-in tariff fiscal incentives and investmentgrants) or quantity-based mechanisms (quotatime gain compensation(TGC) and tendering schemes) Cooperation between the GCC and the EUin this field could therefore be useful and valuable for both regions

68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68

The European and Arab countries gathering respectively in the EuropeanUnion (EU) and the Gulf Cooperation Council (GCC) while sharing anumber of important strategic and political interests have developed dis-tinctly different broad patterns of strategic concerns and relations in the lasttwenty to thirty yearsBoth of them have special concerns for their respective neighbourhood onthe one hand and extremely significant global relations on the otherHowever there is no doubt that the GCC countries have gone global morethan the European Union especially on political ground whereas theEuropean Union has focused on its neighbourhood and structured itsneighbourhood framework far more significantly than the GCC Mostimportantly while both the GCC and the EU countries have a pivotal yetseparate political and security alliance with the United States the formerare now fundamentally oriented towards Asia from a strategic perspectivewhereas the EU is oriented towards North America and its own neighbour-hood - from the Mediterranean to Russia - with the GCC playing a defi-nitely more distant roleTo a large extent it could have been otherwise had the European Unionunderstood the importance and substance of the EU-GCC relations initiat-ed eighteen years ago During that long lapse of time the EU failed torealise that the relationship had to be based on developing mutual econom-ic and financial interests In contrast for a long time it mistakenly protect-ed is petrochemical interests and even today is still conditioning the

69

4 EU AND GCC STRATEGIC INTERESTS


CONVERGENCE AND DIVERGENCE

Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni

upgrading of mutual relations on the GCC partnersrsquo engagement in domes-tic political reforms something which is beyond any GCC perspective andhas no EU political motivationAgainst this background EU and GCC have failed to develop a commoncore strategic relationship and as said have distinct orientations todayHowever it must also be pointed out that these orientations as distinct asthey may be are never opposed to one another and continue to have signif-icant point of contacts As a result a potential for developing common EU-GCC strategic perspectives ndash as distinct from a core relationship - stillexists It might be helpful today to explore the existing points of contact inan international political and security perspective These points could overtime again offer opportunities that were missed in the last twenty yearsThis paper explores these points of contact in the Mediterranean area In astrategic perspective the Mediterranean area may bring together the EUand the GCC essentially for two reasons (a) the strip of territory stretch-ing from Morocco and ndash sometimes ndash Mauritania through to the Levant islargely although not uniquely part of the Arab world and at the same timeis seen by the European Union as an important part of its neighbourhood(b) the Mediterranean Sea is part of the complex system of sea basins andsea routes set at the juncture of Africa Europe and South-western Asia sothat it is a part of the geopolitical approaches that the European continentand the Arabian peninsula share in other words the Mediterranean (linkedas it is to the Red Sea via the Suez Canal) is largely yet not uniquely theplatform where EU-GCC relations concretely take place These two trends- the Arab Mediterranean world and geopolitical approaches to continentalmasses - can help in looking for strategic and political commonalitiesbetween the EU and the GCC

1 Economic Development and Security in the Mediterranean

Recent economic developments illustrate EU-GCC convergence of interesttowards the Mediterranean area Probably the most important develop-ment relates to the evolving pattern of world transport as well as the RedSeaMediterranean Sea corridorrsquos role in it and the implications of that evo-lution Today approximately 80 of world sea transport moves fromSouth-west and South-east Asia on the one hand and goes to theMediterranean the Atlantic coasts of Europe and North America on the

70

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EU and GCC Strategic Interests in the Mediterranean Convergence and Divergence

other The most intensive segment of this route is navigation through theArabian the Red and the Mediterranean Seas Merchandise and goods areunloaded at majors ports in South-west Asia and the Mediterranean ontheir way to more distant destinations in Northern Europe and Americaand are channelled to minor destinations by local systems of transport Thistransport web requires specific technologically advanced equipment andhighly specialized ports The system is run by a handful of multinationalcorporations However Gulf and EU investment have been significantlyattracted towards the Mediterranean (the most important Arab investmentare in Tangiers and Damietta) The EU Commission has long begun to fos-ter the effectiveness of Mediterranean infrastructure on land and at sea inparticular by planning a system of integrated sea-land highways across theMediterranean and beyond One of the major projects contemplated by theUnion for the Mediterranean regards the development of Mediterraneansea highwaysOne can hardly overlook the strategic implications of this development intransport and the role the sea approaches to South-west Asia Europe andNorth Africa play in it In more general terms the point is that smoothaccess has to be assured to these approaches This is above all a global issuein which the United States has primary interest But the same is also trueof US allies in Europe the Mediterranean and the Arab world Access tosuch approaches is a major strategic issue globally but it is obviously of pri-mary and common concern to local areas and countries that is among oth-ers both the EU and the GCCSo there is a rationale for a double strategic EU-GCC convergence relatedto (a) the development of a region (the Southern and EasternMediterranean) that is part of the EU neighbourhood part of the Arabworld and a shared location for investment and (b) the safety of access tothat region An important dimension of access safety is maritime securitybeginning with the fight against piracy in the Arabian Sea and ending withdepollution of the MediterraneanA shared development potential and the need to provide security to it offerthe EU and the GCC an objective platform for strategic cooperation in theMediterraneanToday this potential for strategic convergence is hardly used more oftenthan not it is ignored Essentially cooperation is hindered despite objectivestrategic convergence by the lack of strategic harmonisation and the twopartiesrsquo failure to grasp opportunities that emerged in the last twenty years

71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni

Other stumbling blocks are also worth mentioning however The lack ofcooperation is partly due to the EUrsquos over-structured Euro-Mediterraneanorganisation which tends to limit the EUrsquos actions to the Mediterranean sothat it remains strictly regional and fundamentally exclusive with respect toadjoining regionsMore in particular the EUrsquos Euro-Mediterranean concept is in itself anobstacle It encompasses both EU and non-EU countries At the beginningin 1995 non-EU countries were both Arab and non-Arab (Cyprus IsraelMalta and Turkey) and the rationale for bringing Mediterranean countriestogether was geography and proximity With Cyprus and Malta now mem-bers of the EU and Turkeyrsquos candidature for membership the non-EUcountries are now only the Arab countries and Israel so that the rationale isless clear and somehow uncomfortable In fact this kind of EU-Israel-Arabcollective Mediterranean does not make much sense In this sense theEuropean Neighbourhood Policy with its bilateral emphasis makes moresense for it differentiates relations with Israel and with each ArabMediterranean country in a very loose collective frameworkWhile the EU must be free to develop its own relations with Israel ofcourse these relations should not be an obstacle to relations with the GCCand its member countries as it is today for the Arab Mediterranean coun-tries One reason the GCC countries hesitate to enter Mediterraneanundertakings with the EU is that the Euro-Mediterranean format compelsthem to cohabit or involves the risk of cohabiting with Israel This was aproblem with the New Middle East project and the related initiative ofinstituting a Mediterranean bank for developmentThe EU should rethink its policy towards the Mediterranean The format ofthis policy should be more flexible and should differentiate between coun-tries and stop obliging countries to buy along with the EU into other part-ners as well EU cooperation agreements which are extended only toMediterranean countries today should be extended to other non-Mediterranean Arab countries such as Iraq and Yemen as well as individ-ual GCC countries Some years ago the EU stated its intention to have apolicy ldquoeast of Jordanrdquo coherent with its Mediterranean policy but that ini-tiative came to a dead endThe GCC countries also hesitate to enter into regional Mediterraneancooperation with the EU for another reason not only the presence of Israelbut the absence of a shared political perspective in the Mediterranean Justas the Europeans dislike being a ldquopayerrdquo and not a ldquoplayerrdquo in US policy

72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72


towards the Israeli-Palestinian conflict so the GCC countries do not wantto risk being the same in EU Mediterranean or other Western-initiated proj-ects But this is less an obstacle to the materialisation of the potential forEU-GCC strategic cooperation in the Mediterranean than the result of thelack of such cooperationTo conclude on this point there are trends and factors in the Mediterraneanthat would require and objectively invite EU-GCC strategic cooperationHowever this cooperation is limited and has not emerged because of a lackof strategic will combined with a number of obstacles stemming from theexclusive and ideological nature of the EUrsquos Mediterranean policy

2 Security and Political Cooperation in the Levant

Another matter that has strategic potential in EU-GCC relations is theArab-Israeli in particular the Israeli-Palestinian conflict Both the EU andthe GCC perceive the conflict as a relevant factor in their security SaudiArabia presented a plan for settling the conflict which was later endorsedby the Arab League and became an Arab initiative In its official securitydoctrine (the document endorsed by the European Council in December2003 and reconfirmed at the end of 2008) the European Union empha-sizes that the Israeli-Palestinian conflict constitutes a factor that affects itssecurityYet two differences between the EU and the GCC are worth consideringthe strategic contexts in which the conflict is set by the EU and the GCCrespectively and the different strategic value of the respective allianceswith the United StatesFrom the EU point of view the conflict in particular that between Israeland the Palestinians is set in the Mediterranean framework (in the Levantas a Mediterranean sub-region) and affects EU Mediterranean interestsprominently its interest in neighbourhood security Apart from risks andspill over effects (largely attenuated since the beginning of the 1990s) atpresent the most important EU concern stemming from the Israeli-Palestinian conflict is the fact that this conflict makes EuropeanMediterranean policies ndash the Euro-Mediterranean Partnership yesterdayand the Union for the Mediterranean today ndash hostage to the conflict andprevents them from succeeding in stabilising the area Conversely from theGCC countriesrsquo point of view the conflict is part and parcel of the Middle

73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni

Eastern tangle of conflicts Obviously there are differences among mem-bers states in both the GCC and the EU However these differences aremore significant in the latter than the former A number of larger EU mem-ber states ndash with national foreign policies ranging farther afield than theMediterranean such as the United Kingdom and France ndash may have viewsakin to those of the GCC countries However as members of the EU theyabide by Brusselsrsquo point of view and consider the Israeli-Palestinian conflictchiefly a Mediterranean factorIn past years with the changes impressed on the Middle East by the Bushadministrationrsquos policies and wars the Israeli-Palestinian conflict hasbecome even more tangled with conflicts in the Gulf and the radicalstreams undercutting the greater Middle East The conflict has allowed Iranto magnify its influence in a core Arab area such as the Levant Today forthe GCC countries and in general the moderate Arab coalition the Levantis more integrated than ever in the Middle East In the EU attempts weremade to changing the perspective (hinted at in the previous section) butthey failed All this prevents the EU and the GCC from having the samestrategic perspective on the conflict although they happen to be very closewhen it comes to specific policiesIn fact in the framework of the EU-GCC talks there is a strong long-standing convergence on the Israeli-Palestinian conflict However it is morea diplomatic than a political convergence and in fact does not translateinto any common initiatives This is the case for example on Hamas theEU appreciated the Mecca accord and the efforts to integrate Hamas in anational Palestinian government however the EU abides by the four con-ditions set out by the Quartet and beyond rhetoric fails to understand howimportant national Palestinian reunification is for the regional security ofthe GCC and moderate Arabs To be more precise it understands the pointbut it does not coincide with the EUrsquos strategic perspectivesOne important reason the two perspectives diverge is the EUrsquos and theGCCrsquos different postures with respect to the United States more in gener-al the different relevance of their alliances with the United States Whilethe transatlantic alliance is based on a community and for this reasondespite difficulties and shifts is undercut by primordial identity and secu-rity factors the US-GCC alliance is based on important yet ordinary secu-rity considerationsThe difference when it comes to the Israeli-Palestinian conflict is reflect-ed by the developments that have unfolded in the framework of the first

74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74


unfortunate attempt by the Obama administration to revive the Israeli-Palestinian negotiations on final status Both the EU and the GCC equallyappreciated the first steps made in 2009 Spring by the new administrationto set the Israeli-Palestinian conflict in the wider Middle East context as apriority to be pursued on a parallel track rather than ndash as usual ndash insequence with other regional issues (chiefly Iran To a question from thepress on the existence of an ldquoIran firstrdquo approach the President respondedas follows ldquoIf there is a linkage between Iran and the Israeli-Palestinianpeace process I personally believe it actually runs the other way To theextent that we can make peace between the Palestinians and the Israelisthen I actually think it strengthens our hand in the international communi-ty in dealing with a potential Iranian threatrdquo) Both saw it as an opportuni-ty to solve a conflict that has distinctive strategic value for both of themHowever while the Europeans waiting for Washington abstained from tak-ing initiatives and engaging in politics Saudi Arabia and other GCC mem-bers quite naturally pursued their own policies in the inter-Arab and Gulfframeworks To be put it more clearly while the EU kept on abiding by thekind of ldquoWest Bank firstrdquo perspective held by the new administration SaudiArabia and most GCC countries kept on focusing on the necessity to rein-tegrate Hamas first in an appropriate inter-Arab context (hence the impor-tance of the October 2009 Saudi visit to Damascus) ie focused on inter-Palestinian unity in the context of inter-Arab and regional relationsIn sum things are seen quite differently by the EU and the GCC in aMediterranean vs Middle Eastern context in a communitarian transatlanticalliance vs a non-communitarian Gulf alliance with the United States(One could add that one reason why the EU hesitates to shift from aMediterranean to a full Middle Eastern perspective is its alliance with theUnited States however this is not entirely true and could sound unfair tothe US because there are powerful intra-EU factors that keep the EU inthe Mediterranean At the end of the day the transatlantic alliance does notin itself prevent any EU engagement in politics)In this sense one can conclude that while economic cooperation (and itssecurity implications) between the EU and the GCC in the Mediterraneanmay be based on a strategic rationale from the point of view of political andsecurity cooperation there is an important convergence yet it strategicrationales hardly coincide It must be added that to some extent differ-ences on political grounds ndash as already pointed out ndash may limit economicand security strategic cooperation in the Mediterranean

75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions

Strategic convergence is hard to define It may be determined by deep-sea-ted factors such as identity if not destiny and the like More reasonablyhistory and institutions may make a difference with respect to strategic con-vergence determined by opportunities and more occasional contingenciesOrdinarily strategic convergence is the result of objective as well as subjec-tive factors there are objective factors fostering strategic convergence butsubjective factors may either encourage or limit such convergence In thecase of the EU and the GCC while it would be absolutely misplaced to talkabout deep-seated factors identity or destiny (as the EUrsquos bad rhetoric doeswith respect to Euro-Mediterranean relations) there is an important set ofobjective factors that could determine a strategic convergence were the EUand the GCC only willing to consider it This paper has discussed econom-ic development transport and security in the Mediterranean but there arealso other factors such as financial stability and energy relationsIt is true that there are political limits to convergence However limits toconvergence do not prevent convergence In the Mediterranean ndash and else-where ndash EU-GCC strategic convergence is bound to rest on economic andfinancial factors It is this opportunity that has not been seized upon in thelast twenty years As they were unable or unwilling to grasp existing oppor-tunities in their relations the GCC ended up opting for Asia and the EUfor its neighbourhood Russia and North America Whether the EU and theGCC will recover from these missed opportunities to set up a strategic rela-tion is difficult to say This should not however prevent them from coop-erating in more limited strategic areas such as economic development orfinancial stability in the Mediterranean and elsewhere This could be a real-istic objective to pursue

76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar

ldquoThe Mediterranean Opportunities to Develop EU-GCC Relationsrdquo

10-11 DECEMBER 2009

ROME

Hotel Ponte Sisto ndash Via dei Pettinari 64

IAI Q 18 EN v2 21-06-2010 918 Pagina 77

THURSDAY 10 DECEMBER

100 pm Lunch buffet

200 pm FIRST SESSION - THE MEDITERRANEAN IN EU-GCC

CHAIR Christian Koch Director of International StudiesGCC-EU Relations the Gulf Research Center Dubai

SPEAKER Edward Burke Research Fellow Fundacion para lasRelaciones Internacionales y el Dialogo ExteriorMadrid

RESPONDENTS Saad Abdulrahman Al-Ammar Director Institute forDiplomaticStudies Ministry of Foreign AffairsRiyadh

330 pm Coffee break

400 pm SECOND SESSION - ENERGY IN THE MEDITERRANEAN

AND THE GULF OPPORTUNITIES FOR SYNERGIES

CHAIR Alessandro Minuto-Rizzo Ambassador presentlySenior Strategic Advisor Enel Rome

SPEAKER Naji Abi-Aad Office of the Deputy Premier Ministryof Energy and Industry Doha

RESPONDENTS Giacomo Luciani Director Gulf Research CenterFoundation Geneva OfficeNazim C Zouiouegraveche Chairman of the Board MedexPetroleum Paris

FRIDAY 11 DECEMBER

900 am THIRD SESSION - INVESTMENT FROM THE GCC AND

DEVELOPMENT IN THE MEDITERRANEAN THE OUTLOOK

FOR FINANCIAL AND ECONOMIC EU-GCC COOPERATION

78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78

SPEAKER Beacuteneacutedict de Saint-Laurent General Delegate AnimaInvestment Network Marseille France

RESPONDENT Franco Zallio Senior Consultant Mediterranean andthe Middle East ndash Russia Milan

1030 am Coffee break

1100 am FOURTH SESSION - EU AND GCC STRATEGIC AND

POLITICAL INTERESTS IN THE MEDITERRANEANCONVERGENCE AND DIVERGENCE

CHAIR Michael Bauer Research Fellow Center for AppliedPolicy Research Munich

SPEAKER Roberto Aliboni Vice President Istituto AffariInternazionali Rome

RESPONDENTS Riad Kahwaji Chief Executive Officer Institute forNear East and Gulf Military Analysis DubaiStefano Silvestri President Istituto AffariInternazionali Rome

1230 am ROUND TABLE CONCLUSIONS

CHAIR Stefano Silvestri President Istituto AffariInternazionali Rome

SPEAKERS Dominic Porter Deputy Head of Unit for Relationswith Gulf States Iran Iraq and Yemen DirectorateGeneral for external Relations EuropeanCommission BrusselsTim Niblock Director Institute of Arab and IslamicStudies University of Exeter UK

130 pm Lunch buffet

The al-Jisr project is funded to 50 percent by the European Commissionand 50 percent from its ten consortium partners representing institutions from

Europe and the Gulf region

THE ORGANISERS THANK THE ITALIAN FOREIGN OFFICE AND COMPAGNIA DI

SAN PAOLO (TURIN) FOR THEIR GENEROUS CONTRIBUTIONS

79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79

QUADERNI IAIbull LrsquoItalia nelle missioni civili dellrsquoUE Criticitagrave e prospettive a cura di NicolettaPirozzi (n 35 febbraio 2010 pp185)bull La strategia di sicurezza nazionale per lrsquoItalia Elementi di analisi Federica DiCamillo e Lucia Marta (n 34 dicembre 2009 pp 96)bull La direttiva europea sul procurement della difesa Nicola Di Lenna (n 33 set-tembre 2009 pp 93)bull La nuova iniziativa europea per lo spazio Global Monitoring for Environmentand Security Federica Alberti (n 32 ottobre 2008 pp 157)bull Il programma Joint Strike Fighter F-35 e lrsquoEuropa Michele Nones GiovanniGasparini Alessandro Marrone (n 31 ottobre 2008 pp 93)bull Cooperazione transatlantica nella difesa e trasferimento di tecnologie sensibilidi Alessandro Marrone (n 30 giugno 2008 pp 132)bull Le prospettive dellrsquoeconomia globale e il ruolo delle aree emergenti GlobalOutlook 2007 Rapporto finale Laboratorio di Economia PoliticaInternazionale (n 29 novembre 2007 pp 155)bull Il Golfo e lrsquoUnione Europea Rapporti economici e sicurezza a cura di RobertoAliboni (n 28 settembre 2007 pp 117)bull Un bilancio europeo per una politica di crescita Maria Teresa Salvemini eOliviero Pesce (n 27 giugno 2007 pp 104)bull La politica europea dellrsquoItalia Un dibattito aperto a cura di RaffaelloMatarazzo (n 26 novembre 2006 pp 153)bull Integrazione europea e opinione pubblica italiana a cura di Michele Comelli eEttore Greco (n 25 maggio 2006 pp 72)bull Nuove forme di procurement per la difesa Sara Mezzio (n 24 giugno 2005pp 85)bull Francia-Italia relazioni bilaterali strategie europeeFrance-Italie relations bila-teacuterales strateacutegies europeacuteennes di Jean-Pierre Darnis (n 23 marzo 2005 pp 96)bull La Politica europea di vicinato di Riccardo Alcaro e Michele Comelli (n 22marzo 2005 pp 68)bull La nuova Costituzione dellrsquoUnione e il futuro del Parlamento europeo Collegioeuropeo di Parma Centro studi sul federalismo Istituto Affari Internazionali(n 21 giugno 2004 pp 127)bull Lrsquoarticolo 296 Tce e la regolamentazione dei mercati della difesa RiccardoMonaco (n 20 gennaio 2004 pp 109 pp 109)bull Processi e le politiche per lrsquointernazionalizzazione del sistema Italia a cura diPaolo Guerrieri (n 19 novembre 2003 pp 130)bull Il terrorismo internazionale dopo lrsquo11 settembre lrsquoazione dellrsquoItalia di AntonioArmellini e Paolo Trichilo (n 18 luglio 2003 pp 120)bull Il processo di integrazione del mercato e dellrsquoindustria della difesa in Europa acura di Michele Nones Stefania Di Paola e Sandro Ruggeri (n 17 maggio2003 pp 34)

80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81

bull Presenza ed impegni dellrsquoItalia nelle Peace Support Operations di Linda Landi(n 16 gennaio 2003 pp 83) bull La dimensione spaziale della politica europea di sicurezza e difesa a cura diMichele Nones Jean Pierre Darnis Giovanni Gasparini Stefano Silvestri (n15 marzo 2002 pp 48)bull Il sistema di supporto logistico delle Forze Armate italiane problemi e prospetti-ve a cura di Michele Nones Maurizio Cremasco Stefano Silvestri (n 14ottobre 2001 pp 74) bull Il Wto e la quarta Conferenza internazionale quali scenari a cura di IsabellaFalautano e Paolo Guerrieri (n 13 ottobre 2001 pp 95) bull Il Wto dopo Seattle scenari a confronto a cura di Isabella Falautano e PaoloGuerrieri (n 12 ottobre 2000 pp 86) bull Il ruolo dellrsquoelicottero nel nuovo modello di difesa a cura di Michele Nones eStefano Silvestri (n 11 settembre 2000 pp 81) bull Il Patto di stabilitagrave e la cooperazione regionale nei Balcani a cura di EttoreGreco (n 10 marzo 2000 pp 43) bull Politica di sicurezza e nuovo modello di difesa di Giovanni Gasparini (n 9novembre 1999 pp 75) bull Il Millenium Round il Wto e lrsquoItalia a cura di Isabella Falautano e PaoloGuerrieri (n 8 ottobre 1999 pp 103) bull Trasparenza e concorrenza nelle commesse militari dei paesi europei di MicheleNones e Alberto Traballesi (n 7 dicembre 1998 pp 31) bull La proliferazione delle armi di distruzione di massa un aggiornamento e unavalutazione strategica a cura di Maurizio Cremasco (n 6 maggio 1998 pp 47) bull Il rapporto tra centro e periferia nella Federazione Russa a cura di EttoreGreco (n 5 novembre 1997 pp 50) bull Politiche esportative nel campo della Difesa a cura di Michele Nones eStefano Silvestri (n 4 ottobre 1997 pp 37) bull Gli interessi italiani nellrsquoattuazione di un modello di stabilitagrave per lrsquoArea medi-terranea a cura di Roberto Aliboni (n 3 ottobre 1996 pp 63) bull Comando e controllo delle Forze di Pace Onu a cura di Ettore Greco eNatalino Ronzitti (n 2 luglio 1996 pp 65) bull Lrsquoeconomia della Difesa e il nuovo Modello di Difesa a cura di Michele Nones (n 1 giugno 1996 pp 35)

English Series

bull Ensuring Peace and Security in Africa Implementing the New Africa-EUPartnership edited by Nicoletta Pirozzi (n 17 May 2010 pp 131)bull Europe and the F-35 Joint Strike Fighter (Jsf) Programme Michele NonesGiovanni Gasparini Alessandro Marrone (n 16 July 2009 pp 90)bull Coordinating Global and Regional Efforts to Combat WMD Terrorism editedby Natalino Ronzitti (n 15 March 2009 pp 189)

IAI Q 18 EN v2 21-06-2010 918 Pagina 81

bull Democracy in the EU and the Role of the European Parliament edited byGianni Bonvicini (n 14 March 2009 pp 72)bull Talking Turkey in Europe Towards a Differentiated Communication Strategyedited by Nathalie Tocci (n 13 December 2008 pp 283)bull Re-launching the Transatlantic Security Partnership edited by Riccardo Alcaro(n 12 November 2008 pp 141)bull Stregthening the UN Security System The Role of Italy and the EU edited byNicoletta Pirozzi (n 11 April 2008 pp 108) bull The Tenth Anniversary of the CWCrsquos Entry into Force Achievements andProblems edited by Giovanni Gasparini and Natalino Ronzitti (n 10December 2007 pp 126)bull Conditionality Impact and Prejudice in EU-Turkey Relations ndash IAI TEPAVReport edited by Nathalie Tocci (n 9 July 2007 pp 163)bull Turkey and European Security IAI-Tesev Report edited by GiovanniGasparini (n 8 February 2007 pp 103)bull Nuclear Non-Proliferation The Transatlantic Debate Ettore Greco GiovanniGasparini Riccardo Alcaro (n 7 February 2006 pp 102)bull Transatlantic Perspectives on the Broader Middle East and North AfricardquoWhere are we Where do we go from here Tamara Cofmaqn Wittes YezidSayigh Peter Sluglett Fred Tanner (n 6 December 2004 pp 62)bull Democracy and Security in the Barcelona Process Past Experiences FutureProspects by Roberto Aliboni Rosa Balfour Laura Guazzone TobiasSchumacher (n 5 November 2004 pp 38)bull Peace- Institution- and Nation-Building in the Mediterranean and the MiddleEast Tasks for the Transatlantic Cooperation edited by Roberto Aliboni (n 4December 2003 pp 91)bull North-South Relations across the Mediterranean after September 11Challenges and Cooperative Approaches Roberto Aliboni Mohammed KhairEiedat F Stephen Larrabee Ian O Lesser Carlo Masala Cristina PacielloAlvaro De Vasconcelos (n 3 March 2003 pp 70)bull Early Warning and Conflict Prevention in the Euro-Med Area A ResearchReport by the Istituto Affari Internazionali Roberto Aliboni Laura GuazzoneDaniela Pioppi (n 2 December 2001 pp 79)bull The Role of the Helicopter in the New Defence Model edited by MicheleNones and Stefano Silvestri (n 1 November 2000 pp 76)

82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms

1 Why the European Union Needs a lsquoBroader Middle Eastrsquo Policy Edward Burke Ana Echaguumle and Richard Youngs

Introduction



3 Joining the Dots


2 Investment from the GCC and Development in the Mediterranean Beacuteneacutedict de Saint-Laurent assisted by Pierre Henry and Sami








3 Energy in the Mediterranean and the Gulf Opportunities for Synergies Naji Abi-Aad

Introduction


2 Natural Gas

3 Power amp Water


4 EU and GCC Strategic Interests in the Mediterranean Convergence and Divergence Roberto Aliboni

Introduction



Conclusions

Agenda of the Seminar on ldquoThe Mediterranean Opportunities to Develop EU-GCC Relationsrdquo Rome 10-11 December 2009

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 ESP ltFEFF0055007300650020006500730074006100730020006f007000630069006f006e006500730020007000610072006100200063007200650061007200200064006f00630075006d0065006e0074006f0073002000500044004600200063006f006e0020006d00610079006f00720020007200650073006f006c00750063006900f3006e00200064006500200069006d006100670065006e00200070006100720061002000610075006d0065006e0074006100720020006c0061002000630061006c006900640061006400200061006c00200069006d007000720069006d00690072002e0020004c006f007300200064006f00630075006d0065006e0074006f00730020005000440046002000730065002000700075006500640065006e00200061006200720069007200200063006f006e0020004100630072006f00620061007400200079002000520065006100640065007200200035002e003000200079002000760065007200730069006f006e0065007300200070006f00730074006500720069006f007200650073002egt SUO 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 ITA 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 NOR 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 SVE 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 ENU 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 gtgtgtgt setdistillerparamsltlt HWResolution [2400 2400] PageSize [612000 792000]gtgt setpagedevice


Quaderni IAI



June 2010 18English Series

IAI Q 18 EN v2 21-06-2010 918 Pagina 1

2


Authors










Quaderni IAI






IAI Q 18 EN v2 21-06-2010 918 Pagina 2

3

CONTENTS


List of Acronyms






5

10

13

31

57

69

77

IAI Q 18 EN v2 21-06-2010 918 Pagina 3

4

IAI Q 18 EN v2 21-06-2010 918 Pagina 4

5

INTRODUCTION

Christian Koch


IAI Q 18 EN v2 21-06-2010 918 Pagina 5

Christian Koch


6

IAI Q 18 EN v2 21-06-2010 918 Pagina 6

Introduction


7

IAI Q 18 EN v2 21-06-2010 918 Pagina 7

Christian Koch


8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






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15




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16





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17






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18






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19



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20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



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22


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23


3 Joining the Dots



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24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

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28

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29

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30

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31







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32


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33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

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43


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44


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45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


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53

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54

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55

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56

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57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

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2 Natural Gas


61

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Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

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Naji Abi-Aad


3 Power amp Water


66

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67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

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Roberto Aliboni




70

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71

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Roberto Aliboni


72

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73

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Roberto Aliboni


74

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75

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Roberto Aliboni

Conclusions


76

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77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

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81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions


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2


Authors










Quaderni IAI






IAI Q 18 EN v2 21-06-2010 918 Pagina 2

3

CONTENTS


List of Acronyms






5

10

13

31

57

69

77

IAI Q 18 EN v2 21-06-2010 918 Pagina 3

4

IAI Q 18 EN v2 21-06-2010 918 Pagina 4

5

INTRODUCTION

Christian Koch


IAI Q 18 EN v2 21-06-2010 918 Pagina 5

Christian Koch


6

IAI Q 18 EN v2 21-06-2010 918 Pagina 6

Introduction


7

IAI Q 18 EN v2 21-06-2010 918 Pagina 7

Christian Koch


8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

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12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





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14






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15




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16





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17






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18






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19



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20




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21



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22


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23


3 Joining the Dots



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24





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25





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26




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27

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28

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29

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31







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32


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33

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34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

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43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


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53

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54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



3

CONTENTS


List of Acronyms






5

10

13

31

57

69

77

IAI Q 18 EN v2 21-06-2010 918 Pagina 3

4

IAI Q 18 EN v2 21-06-2010 918 Pagina 4

5

INTRODUCTION

Christian Koch


IAI Q 18 EN v2 21-06-2010 918 Pagina 5

Christian Koch


6

IAI Q 18 EN v2 21-06-2010 918 Pagina 6

Introduction


7

IAI Q 18 EN v2 21-06-2010 918 Pagina 7

Christian Koch


8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



4

IAI Q 18 EN v2 21-06-2010 918 Pagina 4

5

INTRODUCTION

Christian Koch


IAI Q 18 EN v2 21-06-2010 918 Pagina 5

Christian Koch


6

IAI Q 18 EN v2 21-06-2010 918 Pagina 6

Introduction


7

IAI Q 18 EN v2 21-06-2010 918 Pagina 7

Christian Koch


8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



5

INTRODUCTION

Christian Koch


IAI Q 18 EN v2 21-06-2010 918 Pagina 5

Christian Koch


6

IAI Q 18 EN v2 21-06-2010 918 Pagina 6

Introduction


7

IAI Q 18 EN v2 21-06-2010 918 Pagina 7

Christian Koch


8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



Christian Koch


6

IAI Q 18 EN v2 21-06-2010 918 Pagina 6

Introduction


7

IAI Q 18 EN v2 21-06-2010 918 Pagina 7

Christian Koch


8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



Introduction


7

IAI Q 18 EN v2 21-06-2010 918 Pagina 7

Christian Koch


8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



Christian Koch


8

IAI Q 18 EN v2 21-06-2010 918 Pagina 8

9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



9

IAI Q 18 EN v2 21-06-2010 918 Pagina 9

LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



LIST OF ACRONYMS


10

IAI Q 18 EN v2 21-06-2010 918 Pagina 10

List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



List of Acronyms






11

IAI Q 18 EN v2 21-06-2010 918 Pagina 11

12

IAI Q 18 EN v2 21-06-2010 918 Pagina 12


13





IAI Q 18 EN v2 21-06-2010 918 Pagina 13


14






IAI Q 18 EN v2 21-06-2010 918 Pagina 14


15




IAI Q 18 EN v2 21-06-2010 918 Pagina 15


16





IAI Q 18 EN v2 21-06-2010 918 Pagina 16


17






IAI Q 18 EN v2 21-06-2010 918 Pagina 17


18






IAI Q 18 EN v2 21-06-2010 918 Pagina 18


19



IAI Q 18 EN v2 21-06-2010 918 Pagina 19


20




IAI Q 18 EN v2 21-06-2010 918 Pagina 20


21



IAI Q 18 EN v2 21-06-2010 918 Pagina 21


22


IAI Q 18 EN v2 21-06-2010 918 Pagina 22


23


3 Joining the Dots



IAI Q 18 EN v2 21-06-2010 918 Pagina 23


24





IAI Q 18 EN v2 21-06-2010 918 Pagina 24


25





IAI Q 18 EN v2 21-06-2010 918 Pagina 25


26




IAI Q 18 EN v2 21-06-2010 918 Pagina 26





27

IAI Q 18 EN v2 21-06-2010 918 Pagina 27






28

IAI Q 18 EN v2 21-06-2010 918 Pagina 28



29

IAI Q 18 EN v2 21-06-2010 918 Pagina 29

30

IAI Q 18 EN v2 21-06-2010 918 Pagina 30







31







IAI Q 18 EN v2 21-06-2010 918 Pagina 31





32


IAI Q 18 EN v2 21-06-2010 918 Pagina 32





33

IAI Q 18 EN v2 21-06-2010 918 Pagina 33








34

Asia-Oceania 5

Gulf 27

Europe40


USACanada17


Europe50MED-10 5

Other countries 4

USACanada17

IAI Q 18 EN v2 21-06-2010 918 Pagina 34





35

IAI Q 18 EN v2 21-06-2010 918 Pagina 35








36

IAI Q 18 EN v2 21-06-2010 918 Pagina 36






37

IAI Q 18 EN v2 21-06-2010 918 Pagina 37



38


Canada Comment




(OgerWatanya etc)










532 08 22 05









IAI Q 18 EN v2 21-06-2010 918 Pagina 38






39







69198 1000 1000 1000


IAI Q 18 EN v2 21-06-2010 918 Pagina 39













40

IAI Q 18 EN v2 21-06-2010 918 Pagina 40


41












IAI Q 18 EN v2 21-06-2010 918 Pagina 41









42

IAI Q 18 EN v2 21-06-2010 918 Pagina 42












43


IAI Q 18 EN v2 21-06-2010 918 Pagina 43








44


IAI Q 18 EN v2 21-06-2010 918 Pagina 44




















45


reserves Index

IAI Q 18 EN v2 21-06-2010 918 Pagina 45
















46

IAI Q 18 EN v2 21-06-2010 918 Pagina 46





47

IAI Q 18 EN v2 21-06-2010 918 Pagina 47








ASEAN 23 253 252

MERCOSUR 164 11 128




48

IAI Q 18 EN v2 21-06-2010 918 Pagina 48












49

IAI Q 18 EN v2 21-06-2010 918 Pagina 49







50

IAI Q 18 EN v2 21-06-2010 918 Pagina 50







51

IAI Q 18 EN v2 21-06-2010 918 Pagina 51



72 Developing SMEs


52


IAI Q 18 EN v2 21-06-2010 918 Pagina 52





53

IAI Q 18 EN v2 21-06-2010 918 Pagina 53





54

IAI Q 18 EN v2 21-06-2010 918 Pagina 54



55

IAI Q 18 EN v2 21-06-2010 918 Pagina 55

56

IAI Q 18 EN v2 21-06-2010 918 Pagina 56


57



AND THE GULF


Naji Abi-Aad

IAI Q 18 EN v2 21-06-2010 918 Pagina 57

Naji Abi-Aad



58

IAI Q 18 EN v2 21-06-2010 918 Pagina 58





59

IAI Q 18 EN v2 21-06-2010 918 Pagina 59

Naji Abi-Aad


60

IAI Q 18 EN v2 21-06-2010 918 Pagina 60



2 Natural Gas


61

IAI Q 18 EN v2 21-06-2010 918 Pagina 61

Naji Abi-Aad


62

IAI Q 18 EN v2 21-06-2010 918 Pagina 62



63

IAI Q 18 EN v2 21-06-2010 918 Pagina 63

Naji Abi-Aad


64

IAI Q 18 EN v2 21-06-2010 918 Pagina 64



65

IAI Q 18 EN v2 21-06-2010 918 Pagina 65

Naji Abi-Aad


3 Power amp Water


66

IAI Q 18 EN v2 21-06-2010 918 Pagina 66





67

IAI Q 18 EN v2 21-06-2010 918 Pagina 67

Naji Abi-Aad


68

IAI Q 18 EN v2 21-06-2010 918 Pagina 68


69




Roberto Aliboni

IAI Q 18 EN v2 21-06-2010 918 Pagina 69

Roberto Aliboni




70

IAI Q 18 EN v2 21-06-2010 918 Pagina 70



71

IAI Q 18 EN v2 21-06-2010 918 Pagina 71

Roberto Aliboni


72

IAI Q 18 EN v2 21-06-2010 918 Pagina 72





73

IAI Q 18 EN v2 21-06-2010 918 Pagina 73

Roberto Aliboni


74

IAI Q 18 EN v2 21-06-2010 918 Pagina 74



75

IAI Q 18 EN v2 21-06-2010 918 Pagina 75

Roberto Aliboni

Conclusions


76

IAI Q 18 EN v2 21-06-2010 918 Pagina 76

77

Seminar


10-11 DECEMBER 2009

ROME


IAI Q 18 EN v2 21-06-2010 918 Pagina 77


100 pm Lunch buffet





330 pm Coffee break






FRIDAY 11 DECEMBER




78

AGENDA

IAI Q 18 EN v2 21-06-2010 918 Pagina 78












130 pm Lunch buffet





79

IAI Q 18 EN v2 21-06-2010 918 Pagina 79


80

IAI Q 18 EN v2 21-06-2010 918 Pagina 80

81


English Series


IAI Q 18 EN v2 21-06-2010 918 Pagina 81


82

IAI Q 18 EN v2 21-06-2010 918 Pagina 82

Contents


List of Acronyms


Introduction



3 Joining the Dots











Introduction


2 Natural Gas

3 Power amp Water



Introduction



Conclusions



the mediterranean: opportunities to develop ...by tipografia città nuova, p.a.m.o.m. - via san...

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