SATISH KANADY

THE PENINSULA

DOHA: An estimated $72bn of the net sovereign issuance is expected to come from the Middle East and Africa this year, of which $44bn should be prima-rily from four GCC countries- Qatar, Saudi Arabia, Oman and Kuwait.

Qatar is expected to issue bonds/sukuks worth $10bn, Bank of America Merrill Lynch (BofAML) said yesterday.

BofML expects external debt supply of sovereign and corpo-rate debt to increase slightly in aggregate in 2018. It forecasts overall sovereign gross debt

issuance to decrease to $178bn, as sovereigns are turning more to local markets for funding.

The MEAF/GCC regions would account for around half of that.“Our credit analysts forecast corporate issuance will be $400bn.

This brings the total foreign currency external debt corpo-rate and sovereign issuance forecast to $578bn, down from the 2017 high of $630bn, but much higher than the $450bn in 2016.”

2017 was a year of high gross issuance and also high net issu-ance, much higher than 2015 or 2016 and back up at the 2012 level.

BofAML noted that the 2017-2018 sovereign supply will be remembered as the years of the GCCs.“We focus on net issuance for 2018, given the respectable debt management programs that higher quality emerging market countries have been imple-menting to manage their debt.

We forecast net issuance of $124bn for external sovereign debt, just slightly lower than in 2017, while gross sovereign issu-ance could come in at $178bn in 2018, similar to 2017.

We also expect that some additional asset/liability man-agement programmes including

exchange offers, bond calls and buybacks could increase the gross issuance if offset with new external debt funding,” BofAML analysts said.

According to BofAML credit analysts, the largest net issuers Qatar and Saudi Arabia will be followed by Argentina ($13bn) and Indonesia ($13bn).For gross and net issuance, it also include PDVSA with Venezuelan debt.

Net issuance vs gross issu-ance is relatively high in sover-eigns because issuance is typi-cally in longer bonds.

The expected synchronized global recovery will continue to be the main driver of inflows into Emerging Market (EM).The

strong start for risky assets at a global level is reflected in EM, with equities and local market debt outperforming external debt.

The BofAML still sees room for EM to continue to rally despite stretched valuations.

Positive growth dynamics and stable US real rates validate the price action.

Risks for EM external debt supply should be moderate in 2018, as growth is surprising to the upside and technicals are favorable.

BofAML expects a tax-reform-driven rise in rates to be partly offset by further spread contraction.

Double-ended carA double-ended car owned and built by 71-year-old Indonesian mechanic Roni Gunawan in Bandung, West Java province. The head-turning vehicle, which took about three and a half months to build, has two engines, two steering wheels and two sets of pedals.

BUSINESSBUSINESSMonday 29 January 2018

PAGE | 19PAGE | 18

GCC’s broadening of tax base in motion: S&P

Al Hamad Co delivers JAC heavy truck fleet

The overall sover-eign gross debt issu-ance to decrease to $178bn, as sovereigns are turning more to local markets for funding.

Bank of America Merrill Lynch

(BofAML) forecasts :

Qatar could issue $10bn worth bonds in 2018

Bangladesh signs deal with Indonesia for LNG importsREUTERS

DHAKA: Bangladesh signed an agreement with Indonesia on Sunday to open talks on imports of liquefied natural gas (LNG), as the South Asian country turns to the supercooled fuel to fill a shortfall of domestic natural gas.

A letter of intent was signed between two state energy com-panies, Petrobangla and Per-tamina, after a meeting between Prime Minister Sheikh Hasina and Indonesian President Joko

Widodo, who arrived in Dhaka on Saturday.

Bangladesh, a country of more than 160 million people, may import as much as 17.5 mil-lion tonnes of LNG a year by 2025, as its domestic gas reserves dwindle and demand grows. Petrobangla is finalising several floating storage and regasification units, the first of which is expected to commence operations in April 2018.

In September, Bangladesh signed its first ever LNG import deal with Qatar, underscoring the rise of South Asia as a new market for the fuel.

Macron ‘must show example’ on deficit: EU commissionerAFP

PARIS: France may no longer be the eurozone’s deficit dunce but President Emmanuel Macron must do more to improve the country’s finances “if he wants to be the leader in Europe”, the EU’s economy commissioner said yesterday.

France has long been in the EU’s crosshairs over its deficit, which has repeatedly overshot an EU limit of three percent of gross domestic product.

Macron, who is pushing for a profound transformation of the EU, has slashed public spending in a bid to restore France’s credibility, driving down the deficit to an esti-mated 2.9 percent in 2017 -- the first time in a decade it will come in at under three percent.

In an interview with France’s Europe 1 radio Eco-nomic Affairs Commissioner Pierre Moscovici (pictured)urged Macron not to rest on his laurels and to continue reforming France’s big-spending ways.

“Emmanuel Macron wants to be... the leader in Europe and to be the leader in Europe, you must show example,” he said.

“Three percent is not a target, it’s an absolute limit,” the former French economy minister said, adding that while he was satisfied his country was no longer the “dunce” of the eurozone its deficit was still far in excess of the eurozone average.

“The average deficit in the eurozone is not 2.8 or 2.7

percent it’s 0.9 percent,” he noted.

The French government has forecast a deficit of 2.8 per-cent in 2018 -- a figure seen as somewhat optimistic by Brus-sels which expects it to remain at 2.9 percent before inching back up to 3 percent in 2019.

“France is doing better, it is doing better on its deficit, it is doing better on growth.

“But France must aim very high, it must aim for the top spot,” Moscovici, a Socialist, urged, calling for a “very strong deficit reduction”

His call comes at the end of a week in which France’s Court of Auditors -- the public spending watchdog -- also warned that the eurozone’s second-biggest economy was not on a sound footing deficit-wise.

“Even with a deficit under the three percent limit, France still has one of the worst finan-cial situations among almost all its eurozone partners,” the court’s president Didier Migaud warned, calling for faster structural reforms.

Bangladesh may import as much as 17.5 million tonnes of LNG a year by 2025, as its domestic gas reserves dwindle and demand grows.

Trump willing to sign a revamped Paris climate dealAFP

LONDON: President Donald Trump would be willing to sign the US back up to the Paris climate accord, but only if the treaty undergoes major change, he said in comments published yesterday.

Trump was met with global condemnation when he announced in June 2017 that the United States was pulling out of the Paris cli-mate agreement, painting it a “bad deal” for the US economy.

While the president remains firm in his criticism of the historic accord, he said he would be willing to sign up to a revamped deal.

“The Paris accord, for us, would have been a disaster,” he told Britain’s ITV channel in an interviewed to be aired late Sunday.

“If they made a good deal... there’s always a chance we’d get back,” Trump added, describing the current agree-ment as “terrible” and “unfair” to the US.

The landmark treaty was agreed by 197 nations in 2015 after intense negotiations in Paris, where all countries made voluntary carbon-cut-ting pledges running to 2030.

“If somebody said, go back into the Paris accord, it would have to be a com-pletely different deal because we had a horrible deal,” Trump said, according to extracts of the interview.

“Would I go back in? Yeah, I’d go back in... I would love to.”

9,411.53-48.08 PTS0.51%

QSE FTSE100 DOW BRENT7,665.54+49.70 PTS0.65%

26,616.71+223.92 PTS0.85% Dow & Brent before going to press

$66.14 +1.21

18 MONDAY 29 JANUARY 2018BUSINESS

Al Hamad Co delivers JAC heavy truck fleetTHE PENINSULA

DOHA: Al Hamad Automobiles Co, the exclusive dealer for JAC Motor, China, Light & heavy duty trucks in Qatar has delivered the fleet of seven units of JAC heavy truck installed with Freezer boxes and dry boxes to Al Meera,Consumer Goods. Al Hamad Automobiles won the tender from Al Meera in Novem-ber 2017.

The handing over ceremony was attended by the CEO of Al Meera, Cobus Lombard;, the IT Director of Al Meera, Moham-med Abdulla Al Bader; and Hanif Parker, Logistic Manager of Al Meera.

Al Hamad Automobiles Co., Executive Director, Mohamed Yousef Al Mana, welcomed the dignitary from Al Meera and thankrf them for awarding the tender. He promised them that Al Hamad Automobiles shall provide them with the best after sales service support.

George Annich, General Manager of Al Hamad Automo-biles and Mr. Shetty, Sales Manager handed over the keys

of the truck to the delegation of Al Meera Consumer Goods.

Al Hamad Automobiles, have over the years sold more than 4700 units of JAC light & heavy duty trucks in the State of Qatar since 2005 till date and has already established the Brand Image for JAC trucks to become one of the major

players in the heavy duty truck segment.

JAC trucks are now being used in various multiple appli-cation, such as Cargo truck, Cargo truck with boom crane, Cargo truck with Knuckle boom crane and concrete block grab attachment, water tankers, sewage tankers, dump truck

both 6X4 & 8X4, Tractor Head with various trailer attach-ments, transit mixers, skip loaders, hook loaders, recov-ery platforms, man lift trucks, highway maintenance truck installed with truck mounted Attenuator (TMA) approved by Ashghal and Freezer & Chiller trucks.

“At Al Hamad Automobiles Co. W.L.L, our policy is customer satisfaction and loyalty. Accord-ingly we built up a total solution under one single roof and due to our aggressive marketing strategy of providing the cus-tomer with ready stock all the years round and with the excel-lent backup support provided

for the After Sales service in terms of service facility, spare parts availability at competitive prices to secure lowest cost of operation for the customer. Also mobile service and workshop trucks to provide services at site and replacement vehicles in case of repair delay more than 48 hours”, Al Mana said.

QDB participates in International Green Week in BerlinTHE PENINSULA

DOHA: Qatar Development Bank (QDB), through its export programme ‘Tasdeer’, partici-pated in the 83rd International Green Week in Berlin that took place from January 19 to 23.

As part of Qatar Develop-ment Bank’s special pavilion, 12 Qatari companies in the Agricul-ture field and food sector were representing Qatar. The bank’s participation at the event comes in the context of supporting local products and introducing them to regional and international markets.

The Qatari companies that were selected to participate in the international Green Week in Berlin were: Albina Snack, Gulf Water Plant LLC, United Mineral Water Company Sidra, Qatar Food Factories Co., Lusail Water Company Alkaline, Qatar Meat Production Co., KAAFE Choco-latier, Al Qaseem Dates, Munah Foodstuff Factgory, Alsulaiteen Group/Saic and Global Farm for Agricultural supplies.

The 83rd International Green Week was an opportunity for exhibitors from all over the world to display and market their products, open up to busi-ness opportunities, engage in trade agreements and partner-ship deals especially with the active German trade community.

It was also an opportunity for Qatar to promote its products and enhance its position in inter-national markets.

Commenting on the occasion, Abdul Aziz bin Nasser Al Khalifa, Chief Executive Officer of Qatar Development Bank, said: “The reason for participating in the International Green Week in Ber-lin, which was attended by more than 400,000 visitors, due to the significant role it plays as a per-fect platform to test the quality of exhibitors’ products, and the ability to compete in the market.

The exhibition offered a great opportunity for Qatari exhibitors to introduce and promote their diverse products to the world. The exhibition allowed the Qatari exhibitor to interact closely with international companies, share and exchange ideas and experi-ences in the agriculture and food production sector, and explored ways for joint agreements and cooperation at industrial, pro-duction and commercial levels. Qatar Development Bank con-tinues to support the country’s manufacturing industry,

empower their abilities and encourage local SMEs to contrib-ute effectively to the development of their country and diversification of sources of income.”

H E Mohamed bin Abdullah Al Rumaihi, Minister of Munici-pality and Environment of the State of Qatar, inaugurated the Qatari pavilion with the partici-pation of Christian Schmidt, Minister of Nutrition and Agri-culture of the Federal Republic of Germany, in the presence of H E Sheikh Saud

bin Abdulrahman Al Thani, Ambassador of the State of Qatar to the Federal Republic of Ger-many, during the “Green Week” International Fair in Berlin, at its 83rd edition.

Al Rumaihi also participated in the 10th Berlin Agriculture Ministers conference in the pres-ence of the Ambassador of the State of Qatar to the Federal Republic of Germany and more than 70 ministers from around the world.

He held meetings with the German Federal Minister of Food and Agriculture, Christian Schmidt, and Thomas Zelberhorn, Thomas Zelberhorn, Parliamen-tary State Secretary to the Federal Minister for Economic Coopera-tion and Development, which focused on discussing ways of joint collaboration in the agricul-tural sector, the food industry and r e l a t e d d e v e l o p m e n t technology.

Additional meetings were also held with Deputy Prime Min-ister and Minister of Agriculture, Forestry and Food of the Repub-lic of Slovenia Dejan Židan, Somalia’s Minister for Agriculture and Irrigation, Said Hussein lid, Minister of Agriculture and Fish-eries of the Sultanate of Oman HE Dr Fuad bin Jafar bin Al Sajwani, as well as with Turkish Minister of Food, Agriculture and Live-stock, Ahmet Ashraf Fakibaba.

Hempel Paints unveils projects in support of Qatar’s National VisionAHMED SALEM

THE PENINSULA

DOHA: Hempel Paints, global supplier of marine, protective and decorative coatings, has unveiled various projects in support of Qatar National Vision 2030. Hempel Paints is renowned for producing high-quality coatings and solutions that services major local and international sectors and market areas.

“We at Hempel Paints pride ourselves on working closely with our customers to develop solutions that meet their specific requirements.” stated Christo-pher Sharkey (pictured), Country Manager — Hempel Paints

“ Our team of Coating advi-sors are on hand to give our customers adequate advice and support throughout every project, from coating selection through to application and maintenance,”he added.

With it’s state-of-the-art

production facility in Doha’s Industrial area, Hempel Paints has an ample capacity to meet Qatar’s ever growing demands. Hempel’s close proximity to its customers allows its highly inno-vative products and services to be sold and revered locally. “Our production facility here in Doha affords us the privilege of sup-plying our customers in Qatar with a full range of coating

products and solutions, fast and efficiently”, Sharkey said.

Hempel’s Industrial area production facility also allows for quick availability of products and solutions, adequate customer support and the versatility to either supply directly from stock, or to manufacture any product in its range in a timely manner.

In support of Qatar’s vision for 2030, Hempel paints has been proactive in supplying local market areas with an extensive range of its highly innovative coating products and solutions. Hempel has provided high-per-formance coatings for the upstream and down stream oil & gas industry, Both onshore and offshore. Hempel has also taken a proactive role in Qatar’s infra-structure, working closely with Ashghal on various projects, by supplying them with a full range of coatings designed specifically to accommodate steel and con-crete bridges, from small pedestrian walkways to the larg-est road bridges in the country,

as well as providing the coun-try’s transportation centers with a complete range of protective and decorative coatings designed to accommodate airports, rail-way stations and other transport facilities. Hempel has also

developed sustainable solutions that can be utilized in hygiene control areas such as hospitals and specially designed colour palettes to give a lift to the emo-tional well-being of the inmates and visitors. Perhaps Hempel’s

most evident support of Qatar’s Vision for 2030, lies in supply-ing some of the country’s stadia, and sports venues, with a win-ning combination of advanced protection and long-lasting aesthetics.

Hempel Paints’ state-of-the-art production facility in Doha’s Industrial area.

Officials of Al Hamad Automobiles Co and Al Meera during JAC trucks delivery. RIGHT: The fleet of seven units of JAC heavy truck installed with freezer boxes and dry boxes in front of Al Hamad Automobiles showroom.

H E Mohamed bin Abdullah Al Rumaihi, Minister of Municipality and Environment with members of Qatari delegation in Berlin, Germany.

MGT splits from John McAfeeBLOOMBERG

NEW YORK: Controversial anti-virus software developer John McAfee will soon be, in his words, “toiling in obscu-rity.”

MGT Capital Investments Inc, the cybersecurity com-pany that recently shifted its focus to Bitcoin mining, has severed its relationship with McAfee and is considering a sale or spinoff of the cyber-security arm he was meant to run, the company said in a statement.

The Harrison, New York-based company saw its stock surge more than 10-fold in the months after its May 2016 disclosure of ties to McAfee. It’s now looking to cash in on a crypto craze that’s seen numerous small firms book massive share-price increases by reorienting their business to blockchain or coin mining. MGT says it operates comput-ers that harvest Bitcoin and Ethereum.

“The decision was mutual,” McAfee said in an email to Bloomberg News. “My interests have shifted almost 100 percent to the crypto world and I no longer wanted to divide my focus.”

19MONDAY 29 JANUARY 2018 BUSINESS

S&P projects the regional VAT rollout would push up government revenues on average by the equivalent of 1.7 percent-2.0 percent of GDP.

GCC’s broadening of tax base in motion: S&PTHE PENINSULA

DOHA: The introduction of a 5 percent VAT rate across most of the GCC will take place in 2018-2019, S&P Global Ratings said yesterday.

Saudi Arabia and the United Arab Emirates introduced VAT on January 1, 2018, while Bah-rain will wait until later this year and Oman until 2019, likely because of administrative capacity constraints. However, Qatar has announced that it will not introduce VAT at this time, the global ratings agency noted.

S&P projects the regional VAT rollout would push up gov-ernment revenues on average by

the equivalent of 1.7 percent-2.0 percent of GDP. It based its esti-mate on a collection-efficiency ratio of 50 percent-60 percent, which measures how efficiently

the tax can be applied to the con-sumption base. A ratio in this range would reflect an effective tax rate of 2.5 percent-3.0 per-cent, lower than the 5 percent statutory rate, owing to expected administrative inefficiencies and the ability countries have to exempt and zero-rate selected sectors.

The discrepancy between statutory and effective tax rates will likely influence policy-makers’ discussions of future VAT rate increases--potentially to 10 percent--in some GCC countries. With a VAT increase of this magnitude, the effective tax rate would likely rise to 5 percent-6 percent. Government

revenues would likely advance by an additional 1.7 percent-2.0 percent of GDP on average.

Low tax revenues by inter-national standards suggest that GCC sovereigns have some room to broaden the tax base. The region’s tax structure includes no personal income tax and no cor-porate tax on domestic-owned non-hydrocarbon companies, except in Oman. The challenges of higher taxes to the region’s social structure and business model could slow further sub-stantial tax reforms.

The rollout of VAT should support the diversification of GCC government revenues away from t h e i r d e p e n d e n c e

on hydrocarbons. However, we estimate that even if the GCC authorities were to significantly expand the tax base, for example by implementing a 15 percent cor-porate tax, a 15 percent personal income tax, and a 5 percent remittance tax, this would increase government revenues only by about 3.0 percent-4.5 percent of GDP (excluding taxes already applied on foreign-owned companies). This would reduce GCC sovereigns’ central government deficits, but govern-ment revenues would still rely heavily on hydrocarbon revenues.

The constraints to broad tax reform due to GCC sovereigns’

economic and social models make the implementation of such measures unlikely in the short to medium term, in our view. GCC economies’ expatriate workers galvanize their private sectors, while public sector employment underpins the living standards of GCC nationals. A sharp hike in income tax on imported labour, for example, could make the region much less attractive to expatriates. If local nationals were also subject to such a tax increase it could upset the social contract. Moreover, costs of doing business would climb, dampening corpo-rate profitability. S&P, therefore, expects any widening of the tax base will be only gradual.

ECB’s Knot says QE programme needs to endBLOOMBERG

AMSTERDAM: The European Central Bank has to end its quantitative easing as soon as possible, according to ECB Governing Council member Klaas Knot (pictured), who said there’s not a single reason anymore to continue with the programme.

“The programme has done what could realistically be expected of it,” Knot, who also heads the Dutch Central Bank, said in an interview on the tel-evision talk show Buitenhof yesterday.

The ECB is inching closer to unwinding unprecedented stimulus.

At their December meeting, officials held out the prospect of a change in policy language early in the year, and some governors have since expressed their favor for taking a first step in March.

While President Mario Draghi said Thursday that

confidence in a sustained pickup in inflation has increased, patience and per-sistence are still warranted as progress so far remains muted.

Knot, 50, said there’s enough proof for the ECB to end its QE programme in Sep-tember, adding that’s also the current sentiment in the Gov-erning Council.

The ECB stuck by its plan to continue buying ¤30bn ($37bn) of assets a month until at least the end of September, and has reiterated that interest rates will stay low well beyond that.

Inflation probably slowed to 1.3 percent in January, according to a survey of econ-omists before a report on Wednesday.

On Tuesday, data will probably show a 19th

consecutive quarter of expan-sion at the end of 2017.

Knot said the lack of com-mitment to any communica-tion by the ECB as to what might happen to the QE pro-gramme beyond September could have a dampening affect on the euro.

A 6 percent surge in the euro since mid-December is threatening to become a thorn in the economy’s side if it curbs exports and damps prices.

The rally was fueled by US Treasury Secretary Steven Mnuchin’s remarks last week that appeared to welcome a weaker dollar.

Since then, policy makers including ECB president Draghi, Executive Board member Benoit Coeure and Bank of France Governor Fran-cois Villeroy de Galhau have politely reminded US officials of a global commitment to refrain from targeting exchange rates to gain a com-petitive advantage.

Knot said the lack of commitment to any communication by the ECB as to what might happen to the QE programme beyond September could have a dampening affect on the euro.

Ikea founder Ingvar Kamprad dies aged 91

AFP

STOCKHOLM: Ikea founder Ingvar Kamprad (pictured), who built a global business empire with revolutionary flat-pack furniture and was known for his contempt for taxes, died aged 91, the Swedish furnishing giant said yesterday.

The company said in a statement that Kamprad “passed away peacefully

surrounded by his loved ones” at his home in the southern Swedish region of Smaland on Saturday “following a brief illness”.

“His legacy will be admired for many years to come and his vision - to create a better eve-ryday life for the many people - will continue to guide and inspire us,” Jesper Brodin, CEO and president of the Ikea Group, said in the statement.

Born in 1926 to a farming family in the southern Swedish region of Smaland, Kamprad founded the company at age 17.

Despite his enormous suc-cess and wealth, Kamprad’s modest spending habits bor-dered on the obsessive. Kam-prad announced in 2013 that he would be stepping down from the board of Inter Ikea, owner of the furniture giant’s concept and brand, and his youngest son became chairman.

Europe closes in on fresh trade deal as Trump puts up barriersBLOOMBERG

BRUSSELS: Europe is approaching the next stop in its global market-opening drive aimed at countering US President Donald Trump’s protectionist tilt.

Top officials from the European Union will meet with the Mercosur group of Argen-tina, Brazil, Paraguay and Uru-guay on January 30 in Brussels to gauge the prospects for a free-trade deal that would follow groundbreaking com-mercial pacts with Japan and Canada.

The EU-Mercosur talks began almost two decades ago, faltered and were re-started in 2010.

Trump’s move into the White House a year ago with his “America First” agenda prompted an EU push to wrap up the negotiations, which advanced before getting hung up last month over the politi-cally sensitive issues of agri-culture and cars.

“Our aim is to conclude a very ambitious trade agree-ment between us and Mercosur in the coming weeks,” EU Trade Commissioner Cecilia Malmstrom said in an inter-view in Brussels last week.”We aim to finalize this very soon because the clock is ticking.”

EU policymakers are seeking to keep markets open worldwide in the face of Trump’s anti-globalization stance and to underscore the bloc’s continuing commercial clout as the UK prepares to leave.

In addition to building on existing European free-trade pacts with partners that also include Singapore, Vietnam and South Korea, a deal with

Mercosur would give the EU political momentum as it gears up for talks with Australia and New Zealand.

The US threat to the global order in place since the end of World War II was highlighted last week when Trump invoked rarely used “safeguard” rules to impose tariffs on US imports of solar panels and washing machines.

With EU-Mercosur trade worth almost ¤85bn ($105bn) in 2016, a market-opening agreement would be among Europe’s biggest.

The meeting on Tuesday will be at ministerial level, giving both sides a chance to make political concessions that would embolden the negotiators.

Mercosur says an EU offer to open further its agricultural markets, including for beef, is inadequate.

Malmstrom’s team in December proposed to let Mer-cosur export to the bloc at reduced duties an extra 70,000 metric tons of beef, 600,000 tons of ethanol and 100,000 tons of sugar annually.

“If we don’t get a significant agricultural offer, we cannot achieve this agreement,” Rig-oberto Gauto Vielman, Para-guay’s ambassador to the EU,

told the European Parliament’s trade committee on January 23 in Brussels. Europe must do more to ensure a “fair and rea-sonable” accord, he said.

The EU counters that its farm offer is generous and Mer-cosur must agree to open its markets more to European cheeses, cars and car parts.

European agricultural pro-ducers’ interests, traditionally a touchy issue in Brussels, may be even more so now because Ire-land is concerned about the potential impact of the UK’s planned exit from the EU on Irish beef exports.

Mercosur already accounts for around three-quarters of EU beef imports and focuses on pricier cuts.

“The moment is quite diffi-cult for Europe in terms of beef,” Sandra Gallina, the chief EU negotiator with Mercosur, told European lawmakers last Tuesday.

“Our partners are very well aware that there is a Brexit going on and that beef from Ireland may be impacted, so I want to say this is perhaps not the best of moments to go after such a deal.”

Pekka Pesonen, secretary general of Copa-Cogeca, the main European farm-lobby group, told reporters on January 24 that a Mercosur-EU accord could cost farmers in Europe bil-lions of euros and that “we would reject any concessions at this stage.”

Malmstrom played down the deadlock over agriculture, saying farmers’ interests have long kept international trade negotiators at the table longer.

“They are always the last to remain,” she said.”They are dif-ficult, but I hope they are surmountable.”

With EU-Mercosur trade worth almost ¤85bn ($105bn) in 2016, a market-opening agreement would be among Europe’s biggest.

20 MONDAY 29 JANUARY 2018BUSINESS

Canada raised a sun-set clause that would allow one party to quit the treaty after five years, and major changes to existing conflict resolution mechanisms.

Markets and industries are

worried about the possible collapse of

the $1.2trn pact

Canada hopes Nafta talks to continue REUTERS

MONTREAL: Officials trying to hammer out differences over how to update the North Amer-ican Free Trade Agreement (Nafta) have made some progress and hope politicians decide the talks should continue, Steve Verheul (pictured), Cana-da’s chief negotiator,said.

The United States, Canada and Mexico are due to finish the sixth of seven planned rounds of Nafta discussions on Monday, with several major issues far from being resolved.

US President Donald Trump, who describes the $1.2 trillion pact as a disaster, has frequently threatened to walk away from it unless major changes are made.

US Trade Representative Robert Lighthizer, Canadian Foreign Minister Chrystia Free-land and Mexican Economy Minister Ildefonso Guajardo will hold a news conference today to announce the next steps.

Asked whether he thought the three ministers would decide there is enough momentum to continue with the next round, Verheul said: “Well, that’s our hope.”

Later in the day, he told reporters: “We’re moving in a slightly more positive direction.

We’ll take that encouragement where we can.”

A Mexican official, who asked not to be named, said “we don’t foresee a negative reac-tion to the round, we believe the balance will be positive.”

Work is moving ahead on less-contentious parts of Nafta, the Mexican official and a Cana-dian source close to the talks said on Saturday, and the three nations have closed a chapter on measures to fight corruption.

Canada and Mexico initially dismissed some of the main US demands as unworkable but later made it clear they were ready to be more flexible.

During the sixth round, Can-ada raised what it called creative

ways of meeting US demands for higher North American con-tent in autos, a sunset clause that would allow one party to quit the treaty after five years, and major changes to existing con-flict resolution mechanisms.

“I think we have demon-strated we have engaged on most of the big issues,” Verheul said in his remarks to Reuters.”We’ve made progress on some of the smaller ones, so I think (it was) not a bad week.”

The Mexican official said that Canada’s proposals on rules of origin for autos, the sunset clause and conflict resolution mechanism were “positive, in as much as they are an attempt to move things forward.”

Speaking separately, a sec-ond Canadian government source said Ottawa was cau-tiously optimistic about the round, given that the US side had not summarily rejected the proposals for compromise.

Markets and industries are worried about the possible col-lapse of the $1.2 trillion pact.

“It’s unclear to us that any-thing that anyone does here will be enough...which is concern-ing for agriculture,” said Brian Innes, president of the Cana-dian Agri-food Trade Alliance.

“Our position with all the political parties is that the nego-tiations must go on,” said Juan Pablo Castanon, president of the Consejo Coordinador Empre-sarial, the umbrella group representing Mexican private sector interests at the talks.

“We want free trade, but not at any cost,” he said.

Guajardo told Reuters on Friday that the process could be extended if need be.

Hacked crypto exchange to repay ownersREUTERS

TOKYO: Tokyo-based crypto-currency exchange Coincheck Inc said yesterday it would return about 46.3 billion yen ($425m) of the virtual money it lost to hack-ers two days ago in one of the biggest-ever thefts of digital money.

That amounts to nearly 90 percent of the 58 billion yen worth of NEM coins the company lost in an attack that forced it to suspend on Friday withdrawals of all cryptocurrencies except bitcoin.

Coincheck said in a statement it would repay the roughly

260,000 owners of NEM coins in Japanese yen, though it was still working on timing and method.

The theft underscores secu-rity and regulatory concerns about bitcoin and other virtual currencies even as a global boom in them shows little signs of fizzling.

Two sources with direct knowledge of the matter said Japan’s Financial Services Agency (FSA) sent a notice to the coun-try’s roughly 30 firms that operate virtual currency exchanges to warn of further pos-sible cyber-attacks, urging them to step up security.

The financial watchdog is

also considering administrative punishment for Coincheck under the financial settlements law, one of the sources said.

Japan started to require cryptocurrency exchange oper-ators to register with the government only in April 2017. Pre-existing operators such as Coincheck have been allowed to continue offering services while awaiting approval. Coincheck’s application, submitted in Sep-tember, is still pending.

Coincheck told a late-Friday news conference that its NEM coins were stored in a “hot wal-let” instead of the more secure “cold wallet”, outside the

internet. In 2014, Tokyo-based Mt. Gox, which once handled 80 percent of the world’s bitcoin trades, filed for bankruptcy after losing around half a billion dol-lars worth of bitcoins. More recently, South Korean crypto-currency exchange Youbit last month shut down and filed for bankruptcy after being hacked twice last year.

World leaders meeting in Davos last week issued fresh warnings about the dangers of cryptocurrencies, with US Treas-ury Secretary Steven Mnuchin relating Washington’s concern about the money being used for illicit activity

Earnest CEO steps downLOUIS Beryl, co-founder and chief executive officer of Earnest Inc, left the online lender this week after selling his company in October.

The San Francisco-based startup was acquired by stu-dent loan provider Navient Corp for $155m after a lengthy search for a buyer. Beryl and his co-founder, Ben Hutchin-son, were supposed to remain at the firm. Navient confirmed the departure and said, “Ear-nest has an exceptionally talented team, which, together with Navient’s expertise and financial capacity, is building a world-class data-driven f inancial technology business.”

SoFi buys ‘teams’ from startup Clara to boost offeringsBLOOMBERG

SAN FRANCISCO: Social Finance Inc has acquired the engineering and product teams of mortgage startup Clara Lending, bolstering the finan-cial technology company’s offerings beyond student-loan refinancing, according to people familiar with the matter.

In just over six years, SoFi has built one of the largest stu-dent-loan ref inancing businesses in the US and had at one point aimed to create a bank for millennials, with products from insurance and mortgages to wealth management.

Now, San Francisco-based SoFi is struggling to recover from last year’s debacle of law-suits over claims of sexual harassment and fraudulent actions by managers.

Earlier this week, the com-pany announced that Twitter Inc’s chief operating officer, Anthony Noto, would become SoFi’s chief executive officer in March, replacing Mike Cag-ney, who resigned last September.

SoFi confirmed the acqui-sition on Friday and said taking on the Clara teams allows it to “immediately ramp up our technical capabilities.”

While the mortgage busi-ness is only a small part of SoFi compared with loan refinanc-ing, it’s riskier because the firm holds many of those loans on its books rather than securitiz-ing them.

San Francisco-based SoFi has plans to hire about 100 engineers, one of the people familiar with the matter said, and Clara filled about 20 of those spots.

Founded by a former pol-icy advisor at the US Treasury, Clara created an online plat-form for loan applications.

The startup has raised $24.3m in funding from lead investors Redpoint Ventures and Venrock and had fewer than 100 employees, accord-ing to PitchBook Data. The terms of the deal were not disclosed.

Last year, SoFi originated $12.9bn in mortgage, student and unsecured personal loans, Ashish Jain, senior vice presi-dent of capital markets, said during a series of presentations to reporters.

SoFi packed about $8bn of that into securities, issuing $6.9bn in bonds sold to inves-tors, and sold another roughly $2bn of loans to buyers such as regional banks. Much of the rest remains on SoFi’s balance sheet, Jain said.

Angola faces currency test in economy shake-upAFP

LUANDA: Angolan President Joao Lourenco was elected five months ago promising an “economic miracle”.

But the path to transforming the oil-dependent country’s economy will be long and diffi-cult -- as was highlighted by anger over the de facto de-val-uation of the local currency.

Since January, new central bank governor Jose de Lima Mas-sano has been presiding over something of a fiscal revolution, weaning the local kwanza cur-rency off its artificial peg to the dollar, and phasing in a floating exchange rate.

The local unit has been fixed at a rate of 166 to the dollar since 2016, even if the kwanza has changed hands at a rate of more than 400 for a dollar on the black market.

“We have an exchange rate that doesn’t reflect reality,” Mas-sano conceded. Officials are treading cautiously with the reforms.

Before the currency is allowed to float completely freely by the end of 2018, the kwanza is now trading between two rates that authorities are for now keeping secret to avoid speculation.

The central bank chief

justified the move by pointing to the urgent need to stem the “con-tinuing decline of currency reserves”.

In 2014, Angola -- which is Africa’s second largest oil pro-ducer -- was badly hit by the plunge in the price of crude

which is by far the country’s larg-est source of income.

The decline threw the coun-try into a prolonged crisis.

After many years of a cen-trally-controlled exchange rate, Angola came dangerously close to recession and saw its dollar reserves severely depleted by an unsuccessful effort to prop-up the kwanza. Angola was thought to have had $20bn in reserves at the start of 2017, which had slumped to $14bn by November, according to analysts.

“If our foreign currency spending continues at this pace, we run the risk of seeing (reserves) halve between now and the end of the year,” warned central bank chief Massano.

Such a dramatic evaporation of hard currency prompted the new government to take action.

In September, President Lourenco succeeded long-serv-ing strongman, Jose Eduardo dos Santos who had ruled the coun-try -- and its economy -- with an iron fist for 38 years.

Lourenco has waged a

campaign against corruption, notably targeting Dos Santos family members and challeng-ing critics who said he would be puppet of the old regime.

His economic plan has been no less drastic, defined by aus-terity measures, privatisations and efforts to diversify the economy.

“Angola has no other choice but to diversify,” said Lourenco at a press conference last week.”It’s absolutely vital -- our survival depends on it.”

The cornerstone of his reforms are efforts to lure for-eign investors and their dollars back to Angola -- not least through the currency shake-up.

The kwanza has lost 18 per-cent of its value against the dollar and 25 percent against the euro in just three weeks.

The shift quickly pushed up prices in the country where infla-tion officially already runs at 30 percent.

In the capital, where millions live in poverty, prices have

fluctuated wildly. “Any products that are imported are more expensive,” complained Ibrahim Nour, a retailer in the Palanca district.

“This devaluation should have been done before, during the economic boom,” argued Precisio Domingos, an economist at the Catholic University of Luanda. “Now it’s much harder for the people.”

To avoid increasing the country’s widening deficit, the government is now looking to renegotiate its debts -- a proc-ess described by finance minister Archer Mangueira as “a priority”.

Investors have until now welcomed the reforms of Ango-la’s new order.

“Lourenco is using the polit-ical capital he got after coming into office to make big strides,” said William Jackson, an analyst at Capital Economics.

“Although the devaluation could cause short-term prob-lems, it might be positive in the long term.”

An Angolan money changer holding a bundle of Angolan Local currency banknotes in a street in Luanda, Angola.

Macron visits Michelin research centreFrench President Emmanuel Macron (centre) delivers a speech next to Michelin group chairman Jean-Dominique Senard (left) during a visit at the Michelin Ladoux Research and Technology Centre in Ladoux, France.

21MONDAY 29 JANUARY 2018 BUSINESS

“With over 60 percent of its population under the age of 30, the region desperately needs higher growth and more jobs,” it said, adding that around 5.5 million young people will join the job market each year over the next five years.

IMF urges Arab states to undertake reform AFP

RABAT: The International Monetary Fund is holding a two-day regional conference starting from today in Morocco with a message of reform amid growing “frustration” among the population of some Arab states.

“Rising social tensions and protests in several countries across the Middle East and North Africa are a clear indication that the aspirations of the people of the region, for opportunity, prosperity and equity, remain unfulfilled,” said Jihad Azour, Director of the IMF’s Middle East and Central Asia department.

“Reforms are the key to address the fundamental prob-lems that have plagued so many countries of the region for so long: low growth, high unem-ployment and corruption,” he wrote in an analysis ahead of the conference in Marrakesh.

Unemployment in the Middle East and North Africa (Mena) region ranks among the highest in the world, with a job-less figure of more than 50 per-cent, largely due to the low par-ticipation of women in the workforce in conservative Arab countries.

In Marrakesh, government officials, business leaders and civil society figures will hear the IMF’s priorities: to fight corrup-tion, create jobs for the young, bring more women into eco-nomic life and boost the private sector.

The IMF said: “Frustration

runs high over the lack of job opportunities and access to affordable, high-quality public services.”

“With over 60 percent of its population under the age of 30, the region desperately needs higher growth and more jobs,” it said, adding that around 5.5 million young people will join the job market each year over the next five years.

In a region at the centre of the 2011 Arab Spring uprisings, born largely out of economic hardship and discontent among the young, reforms have proved a delicate balancing act.

To benefit from IMF loans, countries such as Tunisia, Egypt and Jordan have had to reduce their budget deficits, resulting in cost of living rises for their citizens.

An austerity budget in Tunisia, along with increases in VAT, sent demonstrators out onto the streets in early January.

“The frustration the Tuni-sian people are feeling is under-standable,” said IMF spokesman Gerry Rice, speaking on the sev-enth anniversary of the Tuni-sian uprising that launched the Arab Spring.

However, he defended the institution against the “out-dated” view that it is the IMF itself that causes the suffering.

“Speaking for the IMF, we do not want austerity. We do want well-designed, well-implemented, socially balanced reforms,” he said.

Egypt, whose economy was also hit hard in the turbulence of its own uprising, in 2016 launched a reform programme in exchange for a $12bn IMF loan. It has since floated its cur-rency against the dollar, trig-gering sharp price rises.

Jordan on Saturday increased the price of bread by up to 100 percent after lifting subsidies on the staple in a bid to redress its debt-riddled economy.

Past price hikes have sparked riots in the cash-strapped country, which has a public debt of some $35bn, equivalent to 90 percent of its gross domestic product.

In 2016, Jordan secured a $723m three-year credit line from the IMF to support eco-nomic and financial reforms.

Hammond, Davis & Clark give Brexit assurances to businessesBLOOMBERG

LONDON: Three UK cabinet ministers promised a speedy agreement on a Brexit transi-tion phase in an open letter to British businesses, seeking to give them certainty over the immediate future.

Britain wants an implemen-tation period of “around two years,” during which the terms of trade with the EU’s other 27 members will remain unchanged, Chancellor of the Exchequer Philip Hammond, Brexit Secretary David Davis and Business Secretary Greg Clark wrote in the letter, published late on Friday by Davis’s department.

During the transition, Britain will also adhere to EU rules and

regulations, and will allow the free movement of EU citizens, who will be allowed to come to Britain to live and work, the min-isters wrote. All sectors, “from goods to agriculture to financial services” and all businesses will be able to trade with the EU as they do today, they said.

The letter aims to reassure British companies that have repeatedly called for more clarity on the government’s plans for Brexit and a planned transition period that’s sched-uled to start in March 2019. The main business lobby groups had wanted the implementation period to be nailed down by the end of last year to allow them the certainty to invest and hire workers, but that deadline slipped. In Friday’s letter, the

ministers wrote that they intend to tie down the deal in the first quarter.

“We believe our proposal is closely aligned with the guide-lines adopted by EU leaders in December,” the ministers wrote. “Both we and the EU therefore want to agree the detail of the implementation period by the end of March, making good as swiftly as possible on our promise of certainty.”

British and European offi-cials are holding secret discus-sions on extending the transition period to almost three years, the Daily Telegraph reported, without saying where it got the information. UK officials are concerned that current plans for a two-year period are too short, the newspaper said.

Britain’s Chancellor of the Exchequer Philip Hammond ( foreground) arrives prior to an Economic and Financial Affairs meeting at the EU headquarters in Brussels in this file picture.

Kuwait Finance House reportsflat net profit

REUTERS

DUBAI: Kuwait Finance House (KFH), the country’s biggest Islamic lender, reported flat fourth-quarter net profit, according to Reuters calculations based on the bank’s annual results.

Net profit was KD46.3m ($154.6m) in the three months to December 31, from KD46.6m in the same period a year ago,

Reuters calculated based on annual results published by the company which do not give a quarterly breakdown. EFG Hermes forecast the lender would make a quar-terly net profit of KD45m. For the full year, the bank reported an 11.5 percent rise in net profit to KD184.2m,.

Liquidated Uruguayan carrier PlunaThe fuselage of a Boeing 737 aircraft which belonged to the liquidated Uruguayan carrier Pluna, is transported from Carrasco’s airport in Canelones department, to the beach resort city of Punta del Este, 120 kilometres east from Montevideo. The former aircraft will be transformed into a technology learning space at a private education centre in Punta del Este.

Hyundai & Kia profits fall behind global rivalsQNA

SEOUL: Hyundai Motor Co and its affiliate Kia Motors Corp fell far behind global rivals in prof-itability last year due to a strong won and declining sales in China and the United States, industry sources said yesterday.

For the whole of 2017, Hyundai Motor and Kia Motors posted operating profit margins of 4.7 percent and 1.2 percent, respectively, down 0.8 percent and 3.5 percent from a year ear-lier, earnings data from the companies showed.

The won’s strength against the dollar and sharp sales declines in China due to a dip-lomatic row over a US anti-mis-sile system had an impact on the carmakers’ bottom lines last year, the companies said in their

statements. Hyundai and Kia’s operating profit margins in the first three quarters were 5.3 per-cent and 0.9 percent, respec-tively, placing them seventh and 11th in terms of profitability among the world’s top 11 com-plete carmakers, according to brokerage reports.

The Korean carmakers, in particular, looked lackluster in comparison to German luxury carmakers Mercedes-Benz and BMW, which boasted operating profit margins of more than 9 percent in the first nine months, the reports indicated.

In the fourth quarter of last year, the corresponding figures stood at 3.2 percent for Hyundai, down from 4.2 percent on-year, and 2.3 percent for Kia, down 4.1 percent on the previous year, the earnings data showed.

VW apologises for emission test on monkeysBLOOMBERG

MUNICH: Volkswagen AG added another twist to the controversy over diesel-emissions cheating, apologising for a test that exposed monkeys to engine fumes to study effects of the exhaust.

The study, conducted by a research and lobby group set up by VW, Daimler AG, BMW AG and Robert Bosch GmbH, was a mis-take, the carmaker said. The New York Times reported earlier about a 2014 trial in a US labo-ratory in which 10 monkeys inhaled diesel emissions from a VW Beetle.

“We apologise for the mis-conduct and the lack of judgment of individuals,” Wolfsburg, Ger-many-based VW said in a state-ment. “We’re convinced the sci-entific methods chosen then were wrong. It would have been better to do without such a study in the first place.”

The revelations show the

rocky road for Volkswagen as it emerges from its biggest crisis after the 2015 bombshell that the company installed emissions-cheating software in some 11 mil-lion diesel vehicles to dupe offi-cial tests.

They also do little to help the poor public perception of the technology under scrutiny for high pollution levels in many European cities. In an additional twist, the Beetle model used in the test was among the vehicles that were rigged to conform to test limits, The New York Times reported.

Daimler said separately it would start an investigation into the study ordered by the Euro-pean Scientific Study Group for the Environment, Health and Transport Sector. BMW too dis-tanced itself from the trial, saying it had taken no part in its design and methods. The study group, financed equally by the three car-makers and Bosch, ceased activ-ities last year and the project

wasn’t completed, VW said. “We believe the animal tests

in this study were unnecessary and repulsive,” Daimler said in a

statement. “We explicitly dis-tance ourselves from the study.”

A file photo of VW car being used for emission test.

Iranian lawmakers reject cuts next budget DUBAI: Iranian lawmakers rejected the outline of a budget proposed by President Hassan Rouhani, which was to include another round of unpopular subsidy cuts for the next fiscal year.

The budget framework was defeated Sunday by a vote of 120 to 83, with nine abstentions, state-run Mehr news agency reported. It did not report the objections, though it said some legisla-tors cited a lack of attention to teachers’ living conditions. Rouhani, who submitted the draft budget to parliament in November, had planned to reduce energy subsidies and strip cash handouts from mil-lions who had received them after an earlier round of sub-sidy cuts.

22 MONDAY 29 JANUARY 2018BUSINESS

Lithuania launches blockchain hub amid ‘fintech’ driveAFP

VILNIUS: Lithuania on Satur-day opened what it calls Europe’s first blockchain hub, with partners in China and Australia, that aims to acceler-ate start-ups as the eurozone Baltic state seeks to become a regional financial technology centre.

Created by European Par-liament member and entrepreneur Antanas Guoga, the Blockchain Centre Vilnius says it will develop blockchain applications for the business, finance and public administra-tion sectors.

Economy Minister Virgin-ijus Sinkevicius told IT and fintech specialists as well as European Commission and European Central Bank officials who attended the launch that it made Lithuania a “European leader” in blockchain development.

Blockchain technology debuted in 2009 for the leading digital cryptocurrency bitcoin allows for the development of peer-to-peer payment systems.

It runs by recording trans-actions as “blocks” that are updated in real time on a digi-tized ledger that can be read

from anywhere and does not have a central recordkeeper.

Partnering with similar centres in Melbourne and Shanghai, the Vilnius centre will also work to establish busi-ness connections in Europe, Asia, and Australia, according to a press release.

The centre gives a boost to Lithuania’s goal of becoming the hub for the fintech indus-try in the northern Europe, thanks to the fastest EU’s licensing process and devel-o p e d c o m m u n i c a t i o n

technology infrastructure. Lithuania’s central bank said it issued “over 30” new licences to fintech companies last year, with special focus on UK-based firms facing Brexit.

The applicants include big names like UK fintech start-up Revolut and a Singapore-head-quartered remittance payments firm InstaRem.

Paulius Kuncinas, chair of the board at the Vilnius block-chain centre hailed the technology as a movement that “gives the power back to people”.

While the EU is eager to embrace the new technology, it is also working on stricter rules to combat money laundering and terrorism financing on exchange platforms for virtual currencies.

Pierre Marro, an EU Com-mission official, said Saturday the EU executive will seek talks with European Central Bank and European Parliament this year to get more “legal certainty” in the area.

“There is no plan for regu-lation on cryptocurrency as far as I know today. But I think that we -- with all the institutions -- are monitoring more and more closely what is happening,” he added.

The centre gives a boost to Lithuania’s goal of becoming the hub for the fintech industry in the northern Europe, thanks to the fastest EU’s licensing process and developed communication technology infrastructure.

California wants 5 million ‘green’ cars on roads by 2030AFP

LOS ANGELES: California Governor Jerry Brown signed an executive order detailing aims to have five million electric cars on the state’s roads by 2030 -- by accelerating the production of such vehicles using financial incentives and rebates.

The $2.5bn, eight-year plan also involves the installation of 250,000 electric vehicle charg-ing stations and 200 hydrogen fueling stations by 2025.

“To continue to meet Cali-fornia’s climate goals and clean air standards, California must go even further to accelerate the

market for zero-emission vehi-cles,” the governor’s office said in a statement.

The order aims to “dramat-ically reduce carbon emissions from transportation -- a sector that accounts for 50 percent of the state’s greenhouse gas emis-sions and 80 percent of smog-forming pollutants,” it added.

The previous target, from 2012, aimed to get 1.5 million “green” vehicles on the roads of the most populated US state -- which boasts the biggest automobile market, with around 14.5 million vehicles for 40 mil-lion people.

California, where the number of zero emissions vehi-cles has risen by 1,300 percent in six years according to the order, will need to maintain similarly exponential growth to meet its latest goal.

Currently, eco-friendly vehicle sales represent five per-cent of sales in the state.

Two years ago, California also adopted a goal of cutting CO2 emissions to 40 percent below the 1990 level by 2030. The “Golden State,” a leading force in the fight against climate change in the US, also aims to obtain half of its electricity from renewable sources by 2030.

Smog enveloping cranes and newly imported cars in the shipyard of the Port of Long Beach in Los Angeles, California, is seen in this file picture.

QATAR STOCK EXCHANGE

QE Index 9,411.53 0.51 %

QE Total Return Index 15,782.58 0.51 %

QE Al Rayan Islamic Index - Price 2,423.94 0.24 %

QE Al Rayan Islamic Index 3,735.99 0.24 %

QE All Share Index 2,642.02 0.48 %

QE All Share Banks &

Financial Services 2,883.69 1.40 %

QE All Share Industrials 2,947.95 0.49 %

QE All Share Transportation 1,974.33 0.53 %

QE All Share Real Estate 1,978.38 0.98 %

QE All Share Insurance 3,525.78 0.61 %

QE All Share Telecoms 1,147.67 0.06 %

QE All Share Consumer

Goods & Services 5,578.74 1.44 %

QE INDICES SUMMARY QE MARKET SUMMARY COMPARISON WORLD STOCK INDICES

GOLD AND SILVER

28-01-2018Index 9,411.53

Change 48.08

% 0.51

YTD% 10.42

Volume 8,906,041

Value (QAR) 200,176,285.00

Trades 3,154

Up 19 | Down 23 | Unchanged 025-01-2018Index 9,459.61

Change 101.01

% 1.08

YTD% 10.98

Volume 9,753,817

Value (QAR) 341,146,948.47

Trades 5,076

EXCHANGE RATE

GOLD QR158.464 per grammeSILVER QR2.0269 per gramme

Index Day’s Close Pt Chg % Chg Year High Year Low

All Ordinaries 6168.8 18.1 0.29 6256.5 6106.2

Cac 40 Index/D 5536.33 1.07 0.02 5567.03 5258.66

Dj Indu Average 26210.81 -3.79 -0.01 26246.19 19732.36

Hang Seng Inde/D 32958.69 27.99 0.08 32930.7 30028.29

Iseq Overall/D 7206.16 -28.95 -0.4 7257.41 7016.09

Kse 100 Inx/D 45063.21 156.01 0.35 44970.78 40169.62

S&P 500 Index/D 2839.13 6.16 0.21744 2833.03 2682.36

Currency Buying SellingUS$ QR 3.6305 QR 3.6500

UK QR 5.1024 QR 5.1743

Euro QR 4.4645 QR 4.5266

CA$ QR 2.9245 QR 2.9817

Swiss Fr QR 3.8057 QR 3.8587

Yen QR 0.03295 QR 0.03359

Aus$ QR 2.9136 QR 2.9709

Ind Re QR 0.0567 QR 0.0578

Pak Re QR 0.0325 QR 0.0333

Peso QR 0.0710 QR 0.0724

SL Re QR 0.0235 QR 0.0239

Taka QR 0.0433 QR 0.0442

Nep Re QR 0.0354 QR 0.0361

SA Rand QR 0.3011 QR 0.3072

Hackers able to make ATMs spit cash like winning slot machines are now operating inside the United States, marking the arrival of “jackpotting” attacks after

widespread heists in Europe and Asia, according to security news website Krebs on Security.

Thieves have used skimming devices on ATM machines to steal debit card information, but “jackpotting” augurs more sophisticated technological challenges that American financial firms will face in coming years.

“This is the first instance of jackpotting in the United States,” said digital security reporter Brian Krebs, a former Washington Post reporter. “It’s safe to assume that these are here to stay at this point.”

On his website, Krebs reported Saturday that the Secret Service has warned financial institutions about “jackpotting” attacks in the past few days, though specifics have not been revealed.

He cites an alert sent by ATM maker NCR Corp to its customers:

“This represents the first confirmed cases of losses due to logical attacks in the U.S.,” the alert read. “This should be treated as a call to action to take appropriate steps to protect their ATMs

against these forms of attack and mitigate any consequences.”

Krebs reported that criminal gangs are targeting Diebold Nixdorfmachines - the stand-alone kind you might see in a drive-through or pharmacy. He shared the ATM giant’s security notice. It described similar attacks in Mexico, in which criminals

used a modified medical endoscope to access a port inside the machines and install malware.

Diebold Nixdorf spokesman Mike Jacobsen declined to provide the number of banks targeted in Mexico and the United States or comment on losses, according to Reuters.

Hackers have also been reported to remotely infect ATMs or completely swap out their hard drives. The Secret Service could not be immediately reached for comment about the nature of the reported US attacks. Whichever method is used, the results are about the same. At a hacker conference in 2010, Wired reported, a researcher brought two infected ATMs to the stage and gave a demonstration.

In the first example, a volunteer from the audience swiped a card through the ATM, and the researcher instantly brought up his credit card number and personal information on a computer spreadsheet. In the second, the researcher gave the machine a command. “Jackpot!!” flashed on the ATM’s screen, and it began spitting bills onto the floor as the crowd cheered. Small-scale jackpotting attacks were reported sporadically in many countries over the next few years, according to Reuters. They finally went big time in 2016.

A gang stole $13m from Japanese ATMs in three hours that spring, Fortune wrote. In the summer, loose cash was spotted fluttering around dozens of First Commercial Bank ATMs in Taipei, Taiwan.

First Commercial subsequently froze withdrawals at more than 1,000 ATMs, according to the BBC. A police investigation revealed masked thieves had been waiting in front of the hacked machines and carried cash away by the bag load - more than $2m across the country.

Hackers are making US ATMs spit out cash like slot machines

Estonia makes ‘token’ effort to take euro cryptocurrency

AVI SELK

THE WASHINGTON POST

AFP

ESTONIA is looking to drag the euro into the crypto age -- and tame the volatility plaguing bitcoin and its peers

-- by creating a digital token backed by the single European currency.

Cryptocurrencies have been on a rollercoaster ride recently, with bitcoin swinging from $10,000 to nearly $20,000 and back in under two months, and volatility is a major hurdle to their widespread adoption for electronic transactions.

One way to counter this would be to issue digital versions of an existing currency, but an initial proposal by a government agency in eurozone member Estonia was torpedoed by European Central Bank chief Mario Draghi last year.

Nevertheless, Kaspar Korjus, managing director of the Estonian government’s e-Residency global digital identity programme, is back with three new proposals to create an “estcoin” digital token that “doesn’t

necessarily” break ECB rules.

His three models for creating an “estcoin” would use the blockchain technology behind bitcoin and other peer-to-peer payment systems.

Blockchain experts argue that one of the proposals could pave the way for the European single currency to be used on a blockchain

platform, but forex analysts are sceptical.

Estonia, the birthplace of Skype and digital global money transfer site Transferwise, is something of a pioneer in shifting government services online. And it also seeking to make it easier for businesses to operate.

Korjus’ e-Residency programme allows people worldwide to open businesses in Estonia -- and hence the European Union -- and manage them remotely, declaring taxes and signing documents digitally.

More than 4,000 businesses and 28,000 individuals have signed up to the scheme since it was launched in 2014.

All three “estcoin” proposals would be tied exclusively to the e-Residency programme.

In the first, Estonian e-residency holders investing in the programme would be rewarded with estcoins.

In the second, “estcoins” would be tied to a user’s e-Residency identity and used for “digitally signing documents, logging into services or enforcing smart contracts.”

In both of these versions, the estcoin’s value would depend on its usefulness on the blockchain, and would not be pegged to the euro.

- ‘No alternative to euro’ - A third model would essentially

enable anyone in Estonia’s e-residency community to use euros on the blockchain, Korjus told AFP.

Under this version, “banks would be required to move money in and out of euro estcoins, but transactions could then take place independently of them through the blockchain,” Korjus explained in an official blog post.

Here, the estcoin’s value would be backed up by “the commitment of the government to buy back every euro estcoin for one euro”, which would be the first time a cryptocurrency was backed up by a state guarantee to convert it into a major currency.

According to cryptocurrency expert Xen Baynham-Herd, this third proposal would be a “new way of expressing a currency, but not a new currency itself.”

He likens it to the “utility settlement coin”, a prototype he helped develop at Swiss bank UBS and which is intended to be used for settling trades of financial instruments.

UBS and other banks have teamed

up to use blockchain technology to speed up such settlements and they suggest resolving the issue of the unit’s value by linking it to an existing currency.

Baynham-Herd said the prototype unit would be backed by “existing cash reserves held at a central bank or commercial bank which is exactly what the ‘euro estcoin’ would be.”

Since such a prototype was being

explored by a large number of central and commercial banks around the world, “the underlying idea isn’t hugely controversial,” said Baynham-Herd, who is now head of strategy and lead economist at Blockchain.com, which develops blockchain infrastructure.

He believes ECB chief Draghi would view the new “euro estcoin” token differently, since it was “simply a new way of issuing or representing existing euro reserves. The value would be one-to-one -- there’s no new money being created.”

But Fawad Razaqzada, an analyst at Forex.com, was more cautious, saying if the “euro estcoin” were pegged to the single currency, it would “effectively create new euros”, which would be illegal.

He pointed out that the Estonian government’s involvement would lend the token a legitimacy and value that many cryptocurrencies were lacking at the moment.

“Whatever the outcome, it will be an interesting experiment,” he told AFP via email. Estonia’s central bank has been cool to the proposals, which it notes have yet to be officially endorsed by the government.

“The emission of virtual tokens that could be converted limitlessly into euros according to an officially fixed exchange rate would definitely be more problematic” than the authors imagine, spokeswoman Ingrid Mitt told AFP.

But Siim Sikkut, a senior official at Estonia’s finance ministry, said that “we fully welcome the e-Residency team’s initiative.”

P J HUFFSTUTTER &

DAVID LJUNGGREN

REUTERS

Krebs reported that criminal gangs are targeting Diebold Nixdorfmachines - the stand-alone kind you might see in a drive-through or pharmacy.

Cryptocurrencies have been on a rollercoaster ride recently, with bitcoin swinging from $10,000 to nearly $20,000 and back in under two months.

The United States remains the dominant grain supplier to Mexico. Yet Mexico imported 583,000 metric tonnes of corn from Brazil in 2017, a 980 percent jump from the previous year.

23MONDAY 29 JANUARY 2018 BUSINESS

A computer generated image released by the e-Residency’s press office shows “estcoins”, the prototype of “crypto token” proposed for use in Estonia’s “Digital nation” e-Residency programme.

US farmers have much to lose if Nafta deal collapses

A collapse of the North American Free Trade Agreement (Nafta), which US President

Donald Trump has threatened to scrap, could create the most profound disruption for US farmers who produce grains, meats and dairy products sold to Canada and Mexico.

Farmer Blake Erwin drives a combine as he harvests corn on his farm near Dixon, Nebraska, US, October 26, 2017.

Blake Erwin, a third-generation American who raises cattle, corn and soybeans in Dixon, Nebraska, said on Saturday that he is not closely monitoring the negotiations, but that he hopes the outcome will support US farmers who are struggling to make a living

due to low commodities prices, rising healthcare costs and high property taxes.

“A trade agreement has to be fair for the United States, but we also want to keep those exports going for the farmer,” said Erwin, 34. “We don’t want to mess up any good things we got going.”

Erwin spoke to Reuters over the weekend as US, Canadian and Mexican negotiators met in Montreal for the sixth of seven planned rounds of talks to revamp the 1994 pact.

US farmers and exporters are fighting to preserve their exports at a time when Canada is finding customers in new markets. They also face strained relations between the United States and Mexico, a major buyer of US corn, wheat, beef, pork and dairy products.

“The US is behaving so badly it’s going to create

opportunities for Canadian agriculture,” Iowa State University economist Dermot Hayes said last week during a visit to Winnipeg.

Trade flows have already begun to shift.

The United States remains the dominant grain supplier to Mexico. Yet Mexico imported 583,000 metric tonnes of corn from Brazil in 2017, a 980 percent jump from the previous year, according to Mexican government trade data.

Mexican imports of US soybean meal, used to feed chickens and livestock, fell 29 percent in the first 11 months of 2017, compared with the same period the previous year, according to the US Department of Agriculture.Trump’s animosity toward Mexico and complaints over trade imbalances have pushed longtime buyers to work with

new suppliers and expand existing relationships in South America, the European Union and other regions, trade experts said.

“You get partners who build a bond and get real comfortable working together. We’re starting to see that bond becoming more important than price for where countries are buying grains,” said Karl Setzer, risk management team leader for MaxYield Cooperative.

Case in point: A rare 30,000-tonne shipment of Brazilian corn steamed its way in November to grain terminals in the state of Veracruz, Mexico, operated by agribusiness heavyweights Cargill Inc and Archer Daniels Midland Co

Despite a steep decline in US corn prices, with stocks sitting at a historic high, the buyer paid a premium for the Brazilian grain - as much as $2

more per tonne, according to trade sources.

A Cargill spokeswoman said the company had no immediate comment. ADM did not respond to requests for comment.

Canada last week agreed to join the new version of the Trans-Pacific Partnership, part of a broad effort to court new trade partners.

“The tough Nafta negotiations have convinced Canada that we have to have a number of trading partners, not just one,” said Ron Bonnett, a beef farmer and president of the Canadian Federation of Agriculture. The revised TPP, known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, will reduce tariffs on Canadian pork, beef and wheat to Japan and other markets, in some cases eliminating duties altogether.

24 MONDAY 29 JANUARY 2018

INsightback to BUSINESS

CAPITALCOMMENT

Our aim is to conclude a very ambitious trade agreement

between us and Mercosur in the coming weeks. Cecilia Malmstrom,

EU Trade Commissioner.

NAME IN THE MARKET: GLOBAL WEALTH GAP

You’ve traded on inflation data and the prospect of rising sovereign-debt supply. You’ve wagered on Federal Reserve meetings and

what the next chairman might do. And you’ve bet on jobs and wage growth that exceed or miss targets.

Now try doing it all in one week. With yields threatening to leap higher, bond

traders will grapple this week with market-moving stimuli coming at breakneck speed. The selloff in Treasuries less than a month into 2018 has already sparked calls of a bear market, including from Ray Dalio, founder of hedge fund Bridgewater Associates.

US domestic events are about to take center stage, after decisions by the Bank of Japan and European Central Bank left 10-year yields close to the highest since 2014. Traders will have a few things on their minds: Janet Yellen’s final meeting as Fed chair, the Treasury’s plan to cover widening deficits, and, to cap it all off, an update on the US job market.

“It seems almost impossi-ble how much is jammed into one week,” said Michael Lorizio, a senior trader at Manulife Asset Management, which oversees $383bn.

“The more responsible shorter-term trading ration-ale is rather than making a major shift in your invest-ments, being willing to miss

the first few basis points to have your longer-term thesis proven or disproven by the new data and information.”

The 10-year breakeven rate is the highest since 2014, signaling demand for protection against accel-erating inflation. Fed funds futures are pricing in more than 2.5 rate hikes by the central bank this year, close to policy makers’ forecast for three. At the end of last week, options activity indicated growing interest in hedging against an extended selloff.

And then there’s supply. The Treasury is expected to unveil bigger note sales this week for the first time since 2009. More issuance just as the Fed is trimming its balance sheet and has a green light from markets to keep raising rates? Sounds like a tough environment for bond investors.

To be fair, not everyone’s buying into the gloom. Dimitri Delis, senior econometric strategist at Piper Jaffray in Chicago, points to the deteriorating US sav-ings rate. As a share of disposable income, it fell to 2.6 percent last quarter, the third-lowest on record. That matters because consumers make up about 70 per-cent of the economy.

The 10-year breakeven rate is the highest since 2014, signaling demand for protection against accelerating inflation. Fed funds futures are pricing in more than 2.5 rate hikes by the central bank.

Cruising on the EdgeTHE PENINSULA

DOHA: Celebrity Cruises is known for its modern luxury cruising and continuous inno-vation that pushes the cruise industry forward with stunning ships. In November 2018, the company will introduce, Celeb-rity Edge, a revolutionary new ship which will change the concept of cruises and shatter all expectations.

This breakthrough in mod-ern luxury travel will carry 2,900 guests and offer them extraor-dinary features, from the breath-taking views to the top-o f - t h e - l i n e c r u i s e accommodations. Celebrity Edge will be the first of four vessels from the Edge Class, boasting the world-first Magic Carpet, Des-tination Gateway, Rooftop Garden and seamless cabins with open air access.

When it comes to versatility, The Magic Carpet offers the best views aboard as you soar over the open ocean. The highlight of this outward-facing vision, an incredible engineering feat is the world’s first cantilevered, float-ing platform that reaches heights of 13 stories above sea level.

The Magic Carpet is designed with comfortable seating, a full bar, and space for live music performances, so it truly is a des-tination itself on Celebrity Edge.

But depending on the position-ing, its mood and function changes— The restaurant moves vertically between the decks of the ship, providing a new expe-rience when stopping on each deck, and spectacular views on every surface of the ship.

At the very top of the ship, the Magic Carpet becomes an extraordinary venue high in the sky where we host mouth-watering experiences such as Dinner on the Edge. Down to Deck 14, the Magic Carpet becomes a stunning extension of the main pool area, while on Deck 5, it serves as an unforget-table, open-air dining experience. Then at the bottom on Deck 2, the Magic Carpet becomes an extension of mod-ern luxury at The Destination Gateway.

The Resort Deck offers end-less ways to enjoy the outdoors and connect with the sea. It includes everything from an asymmetrical outward-facing pool deck to a jogging track that winds up, down, and around the new Rooftop Garden - a living urban playscape inspired by childhood playgrounds, full of unexpected pleasures day and night. Drift away to the rhythm of live musical performances coming down to you from tree-top sculptures. Get caught up in a friendly game of giant chess.

Catch a movie at A Taste of Film for an interactive fusion of food and film. Your imagination is your guide in this fantastic gar-den escape.

The Edge Stateroom with Infinite Veranda has an entire living space that transforms into a veranda with the touch of a button. The 950-square-foot Edge Villa is a two-story opu-lent residence with a seamless blend of indoor and outdoor liv-ing that gives direct access to The Retreat Sundeck, pool, bar and an exclusive area for Suite Class guests. The splendour of the Penthouse Suites is in the latest technology meant to adjust every comfort feature with a simple touch screen. Choose a setting to tuck you in and wake you up if you so desire! Lastly, the position of Celebrity Edge’s 1,892-square-foot Iconic Suites offers a sweeping panoramic view that is great for hosting in-suite occasions.

Royal Caribbean Arabia has been championing the world’s most innovative and state-of-the-art cruise experiences for over a decade, and a represent-ative of Royal Caribbean International, Celebrity Cruises and Azamara Club Cruises.

Royal Caribbean Interna-tional is an award-winning global cruise brand with a

48-year legacy of innovation and introducing industry ‘firsts’. The company offers experiences that have never been seen before at sea, to appeal to fam-ilies and adventure seekers alike. The cruise liner sails 24 of the world’s most innovative cruise ships to the most popu-lar destinations in Bermuda, Caribbean, Europe, Canada, New England, Alaska, South America, Asia, Australia and New Zealand.

Celebrity Cruises’ iconic “X” is the mark of modern luxury, with its cool, contemporary design and warm spaces; din-ing experiences where the design of the venues is as impor-tant as the cuisine; and the amazing service that only Celeb-rity can provide, all created to provide an unmatchable expe-rience for vacationers’ precious time. Celebrity Cruises’ 12 ships offer modern luxury vacations visiting all seven continents.

Azamara Club Cruises is a boutique upmarket cruise line. Azamara’s wide selection of Destination Immersion signa-ture programming offers guests the opportunity to Stay Longer and Experience More. In 2018, Azamara will take guests to more than 200 ports, in 70 countries, including 170 late night stays and 114 overnights.

A sun-deck suit (SuiteSunDeck) on-board Edge.

Bond traders’ wild ride to kick into overdriveNEW YORK/BLOOMBERG

Demand for fast EU law on Chinese takeoversBERLIN: Germany wants to acquire the legal means to take a closer look at bids from Chinese companies to acquire German and European companies in order better to protect technologies, a German minister told news-paper Welt am Sonntag.

Matthias Machnig, state secretary in Germany’s eco-nomics ministry, said it was urgent that proposed Europe-wide measures to police surging Chinese investment be adopted by the end of this year. “It is essential that we get a tougher law in the Euro-pean Union this year to resist takeover fantasies or outflows of technology or know-how,” he said in an interview,