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FRANKFURT AM MAIN — European Central Bank (ECB) chief Christine Lagarde said on Wednesday she was "not overly concerned" that the coronavirus pandemic could renew fears of the eurozone breaking up, after a report from the Frankfurt institution highlighted the danger on Tuesday.

      "I'm not overly concerned about it" although "policymakers will have to continue watching" mounting debt levels in the eurozone as governments borrow to cushion the coronavirus' effects, Lagarde said in a video stream addressed to the single currency bloc's young people.

      In a twice-yearly financial stability report, the ECB had warned on Tuesday that rising debt could increase perceptions of "redenomination risk" -- the danger of some countries quitting the euro or the single currency collapsing altogether.

      While Lagarde acknowledged that "some countries will be more affected than others", she issued a firm "no" when asked if the pandemic could renew the danger of the eurozone breaking up.

      "All countries around the world had to increase their debt" which was "the right thing to do," she said.

      She noted that historically low interest rates at present make the cost of servicing debt "remarkably low".

      "What it will be spent on is what really matters," Lagarde said, arguing investments to "transform our economies" towards digitalisation, productivity and combating climate change would pay off in the long run.

      Meanwhile, Lagarde predicted that the eurozone economy would contract by between eight and 12 per cent in 2020, saying that a "mild" five-per cent scenario discussed at policymakers' April meeting was already "out of date".

      "It's likely that we will be somewhere in between the medium and the severe scenario," she said.

      The exact severity of this year's blow to activity "is obviously going to be a factor of how quickly the lockdown measures are lifted, how suddenly, gradually the economy picks up again, what sectors of the activities will be damaged particularly," Lagarde said.

      Also on Wednesday, Lagarde's ECB executive board colleague Isabel Schnabel told the Financial Times that the institution "will be ready to expand" on more than one trillion euros ($1.1 trillion) of bond-buying already planned this year to cushion the virus' impact on the financial system.

      The "size but also the composition and duration" of a key component of the scheme, the 750-billion-euro "Pandemic Emergency Purchase Programme" (PEPP) could be increased, Schnabel said.

PARIS — Automakers Renault, Nissan and Mitsubishi unveiled on Wednesday a plan to deepen their alliance, a top global producer of cars, that only months ago seemed on the verge of breakup.

      The announcement comes as the industry faces an existential crisis from the coronavirus pandemic, which has caused sales to plunge as governments have forced citizens to stay at home to slow the spread of the virus.

      The three companies announced what amounts to a push towards an integrated entity, something that political sensitivities over job losses had previously made difficult.

      The carmakers said they will adopt a "leader-follower scheme to enhance efficiency and competitiveness" which involves each of them taking the lead in every region of the world.

      The alliance is to focus on one model per product segment, which would be developed by the leading company in that particular segment and adapted by the others.

      Production could be grouped together where appropriate.

      The plan "is expected to deliver model investment reductions of up to 40 per cent for vehicles fully under the scheme," they said, with nearly half of new cars to be jointly developed by 2025.

      Renault shares surged on the Paris bourse following the announcement, rising nearly 20 per cent in morning trading Wednesday from the previous day's levels. 

      Alliance the car key 

      Renault head Jean-Dominique Senard, who also leads their alliance, said the plan will "bring out the most of each company's assets and performing capabilities, while building on their respective cultures and legacies".

      It will increase "their respective competitiveness, sustainable profitability and social and environmental responsibility," he added

      The carmakers will also focus on their core regions, with Nissan becoming the reference for China, North America and Japan.

      Meanwhile, Renault will take the lead in Europe, Russia, South America and North Africa, and Mitsubishi Motors in ASEAN and Oceania countries.

      "The alliance is the key to our resilience and our competitiveness..." Senard said in a later press conference.

      Shift to competiveness 

      He said the emphasis was "on efficiency and competitiveness rather than volumes".

      This appears to be a major change from the strategy pursued under Carlos Ghosn, who led the industrial alliance into becoming the world's biggest car manufacturer by volume in 2017 and 2018 with sales of 10.6 million passenger cars and light commercial vehicles. 

      Ghosn built the alliance based on a series of cross shareholdings rather than a vertical ownership of brands. Integration of their operations has been limited.

      Ghosn was forced out as the head of the alliance after being arrested in Japan in 2018 on allegations of financial misconduct. He denied the accusations, fled trial in Japan and surfaced in Lebanon last year.

      Without Ghosn at the helm, relations between the automakers deteriorated as long-standing gripes about the relative weight of their respective stakes, and the French government's shareholding in Renault, increasingly came out into the open.

       Crisis response 

      But as the financial performance of all three automakers hit bumps, the three announced in January they would look to deepen their alliance as the way forward.

      With automakers now forced to drastically cut back production and jobs in any case, plans to further integrate operations may finally overcome opposition from workers and governments.

      Renault has been negotiating to get a 5-billion-euro state-backed loan, but the French government has made this conditional on guarantees for workers and production to remain in the country, and pushed the automaker to join a European initiative on batteries for electric cars.

      Both Nissan and Renault are set to unveil details on their restructuring plans in the coming days, while Mitsubishi is expected to follow suit in July or August.

      Thousands of jobs are likely to go and some factories shuttered as the automakers adjust to the huge drop in demand for cars.

      France also unveiled on Tuesday an 8 billion-euro plan to support the auto industry that including a cash-for-clunkers scheme.

NEW YORK — Wall Street stocks surged on Tuesday on optimism about coronavirus vaccines as the New York Stock Exchange (NYSE) resumed physical floor trading for the first time since late March.

About 30 minutes into trading, the Dow Jones Industrial Average was up 2.4 per cent at 25,038.94.

The broad-based S&P 500 gained 1.7 per cent to 3,007.76, while the tech-rich Nasdaq Composite Index advanced 1.2 per cent to 9,434.99.

Analysts pointed to announcements by a number of companies pursuing vaccines for coronavirus, including Merck, which said it would acquire privately-held vaccine company Themis and disclosed new research ventures with other companies.

The gains came after New York Governor Andrew Cuomo, wearing a mask, rang the opening bell to signal the start of the day for traders, also clad in masks and separated by plexiglas.

The NYSE, which closed on March 23 as coronavirus cases were soaring in New York, is ramping up slowly with only a fraction of the normal trading staff. 

Traders are required to wear masks and have their temperatures taken and must respect social distancing rules.

While many transactions now are executed through computers -- enabling the market to function even when physical trade was halted -- NYSE leaders say maintaining physical trading facilitates buy and sell orders particularly in the final moments of the day, or during first trades of a new company following an initial public offering.

The floor also has ceremonial benefit for companies to market IPOs and other corporate initiatives.

CAIRO — Egypt's cabinet has preliminarily approved a bill that taxes one per cent of citizens' salaries to cushion the impact of coronavirus on strained government finances, sparking online criticism.

      The draft law — due to come into effect as of July, pending parliamentary approval -- imposes the deductions across the public and private sectors on employees with monthly net incomes above 2,000 Egyptian pounds (around $125). 

      "All governments across the world give out money to their people except for Egypt" to help cushion the effects of coronavirus, said one Twitter user. Instead, the Egyptian government "reaches into the pockets of Egyptians to take 1 per cent." 

      The bill also stipulates a 0.5 per cent effective tax on state pensions to help "confront some of the economic repercussions resulting from the spread of coronavirus," the cabinet said in a statement this week.

      On Facebook, some citizens alleged that depriving pensioners of part of their income was "unconstitutional".

      The draft law provides for a possible exemption of those "working in sectors that were economically harmed due to the coronavirus spread," the statement said, without elaborating.

      The legislation has yet to be scrutinised by parliament and it will also require presidential assent to become law. 

      Egypt's economy, like elsewhere, has been hit hard by the COVID-19 illness which has so far officially killed 696 out of 15,003 confirmed cases in the country.

      Earlier this month, the International Monetary Fund approved a $2.8 billion aid package to help the country meet rising external imbalances.

      In a bid to support the economy, the Egyptian government has begun to ease some confinement measures, including relaxing curfew hours and partially reopening some hotels. 

BAGHDAD — Iraq's new finance minister was in Saudi Arabia on Saturday seeking emergency funds to stave off an impending financial crisis brought on by collapsing oil prices. 

      In his first trip abroad since becoming minister, Ali Allawi met the Saudi finance, energy and foreign ministers in Riyadh on Friday, Iraqi state media reported.

      In an interview with state television before his departure, Allawi said his priority would be to secure funds to plug gaps in Iraq's budget. 

      "Iraq is in need of immediate monetary support so that the government can fulfill its obligations towards its employees," he said.

      Iraq is facing a liquidity crisis following the collapse of crude oil prices from more than $50 per barrel last year to around $20 per barrel in recent months.

      That has prompted fears about the government's ability to pay salaries to some four million state workers, as well as pensions and welfare to another four million people. 

      The government budgeted almost $4 billion a month for public salaries in 2020, but it only earned $1.4 billion in April by selling crude oil -- virtually the only way authorities can fund official expenditures. 

      Prime Minister Mustafa Kadhemi last week pledged that May salaries would be paid as usual, with officials telling AFP they would likely have to resort to internal borrowing. 

      Ahead of Allawi's trip, an Iraqi government source told AFP the minister would also travel to Kuwait and the United Arab Emirates "to gather financial support for Iraq".

      Kadhemi is also likely to visit the Gulf, the official said.

      The prime minister took office in early May after months of political deadlock and is known to be a personal friend of Saudi Crown Prince Mohammed Bin Salman. 

      His appointment was welcomed by the United States, which swiftly granted Iraq a 120-day extension on a waiver allowing it to import Iranian gas to feed its worn-out power grid.

      Washington has insisted that Iraq wean off Iranian energy and partner with American or Gulf companies to stand up its overstretched electricity sector.

      Last year, Iraq signed a landmark deal with the six-nation Gulf Cooperation Council (GCC) for a transmission line to import 500 megawatts of electricity to its grid this year.

      The 300-kilometre (200-mile) line would run from Kuwait to Iraq's southern port of Faw and be financed by the GCC -- Kuwait, Saudi Arabia, the UAE, Qatar, Oman and Bahrain --  according to the electricity ministry.

      A second Iraqi official told AFP that the previous cabinet had considered asking Kuwait to accept a delay in the monthly reparations payments it makes to compensate for Saddam Hussein's invasion of the Gulf State in 1991. 

      "We need as much liquidity as we can get for salaries," that official said. 

KUWAIT CITY — Kuwait and Saudi Arabia are to suspend oil production from the neutral zone they share in June as part of cuts they agreed to shore up prices, a Kuwaiti official said. 

      The oil cartel of the Organisation of the Petroleum Exporting countries (OPEC) to which both countries belong struck a deal with non-OPEC producers, led by Russia, in April to cut output by a record 9.7 million barrels per day after crude prices plummeted to a two-decade low.

      Last week, Saudi Arabia -- the world's biggest oil exporter -- pledged to cut an additional one million bpd beyond its agreed quota in June in a bid to reduce excess supply.

      The United Arab Emirates and Kuwait followed suit with pledges of additional cuts of 100,000 bpd and 60,000 bpd respectively. 

      In the neutral zone, Kuwait and Saudi Arabia decided to shut down the offshore Khafji oilfield for one month starting June 1, acting head of Kuwait Oil Gulf Co. Abdullah Al-Sumaiti told the official KUNA news agency on Wednesday.

      Production at Khafji had partially resumed in March following a five-year halt due to a dispute between the two countries.

      There is currently no producution at the onshore Wafra field.

      The neutral zone, which is shared equally between Kuwait and Saudi Arabia, produced 500,000 bpd before production was halted in late 2015.

      The two countries resolved their row with the signing of a new border agreement in December last year.

      Khafji produced some 300,000 bpd before the stoppage five years ago but it had not recovered full output. In early April, Kuwait exported the first one million barrels of crude from the field after resumption.

BEIRUT — A Lebanese prosecutor on Thursday charged a bank manager and money changers with manipulating the exchange rate and money laundering in an ongoing currency crisis probe, official media and judicial sources said.

      Lebanon is in the midst of its worst economic crunch in decades, compounded by a coronavirus lockdown.

      Banks have gradually stopped all dollar withdrawals in recent months, and the local currency has plummeted from 1,507 to more than 4,000 pounds to the dollar on the black market.

      "Financial prosecutor Ali Ibrahim charged the deputy head of the money changers' union Elie S., as well as a number of senior money changers... and a bank employee, with the crimes of violating the money changing law and money laundering", among other charges, the National News Agency said.

      Their cases have been referred to an investigative judge, it said.

      Judicial sources told AFP nine people in total faced the same charges, also including "manipulating the exchange rate".

      Among them were a branch manager at the Societe Generale de Banque au Liban (SGBL) bank accused of supplying dollars to money changers, and an employee at a money transfer company over the alleged channelling of funds abroad, the sources said.

      Lebanon has detained dozens of foreign exchange office employees in recent weeks over the fast depreciating pound, including the head of the money changers' union Mahmoud Mrad at the start of the month.

      The investigation has also seen the first charges against a senior central bank employee in the case.

      On Monday, the director of monetary operations at the central bank, Mazen Hamdane, was charged with "manipulating the national currency and breaching the pound's stability through directly buying dollars from money changers", a judicial source said.

      Late last week, the central bank issued a statement denying it was behind "any manipulation in the money changing market".

LONDON — British inflation hit a near four-year low in April as oil prices crashed, official data showed on Wednesday, with the rate set to slide further as the coronavirus slashes prices generally.

      The Consumer Prices Index (CPI) annual rate slumped to 0.8 per cent last month from 1.5 per cent in March, the Office for National Statistics said in a statement.

      Analysts' consensus forecast had been for a slide to 0.9 per cent.

      "The fall in the headline rate of CPI inflation in April to its lowest level since August 2016 primarily was due to a 0.6 percentage-point reduction in the contribution from energy prices," noted Samuel Tombs, chief UK economist at Pantheon Macroeconomics.

      He added that inflation was set to hit zero by the summer as "retailers are planning further large price cuts".

      While Britain's government has eased its lockdown, the bulk of shops remain shut as the country's official death toll from COVID-19 reached at least 41,000, second only to the United States.

      Meanwhile, world oil prices have plummeted during the crisis on eroding demand for crude, pulling down prices of petrol and jet fuel.

      "It's widely accepted that the pandemic is a profoundly deflationary shock to the global economy," Neil Wilson, chief market analyst at trading group Markets.com, said following Wednesday's data.

      "No surprise then that UK consumer price inflation" tanked in April.

DUBAI — The Investment Corporation of Dubai (ICD) reported on Wednesday a 16.9 per cent rise in 2019 profit, but anticipated "significant disruptions" ahead due to the coronavirus pandemic. 

      The emirate's investment arm, which holds major stakes in a highly diversified portfolio, said it posted a 25 billion dirham ($6.8 billion) net profit compared to $5.8 billion in 2018.

      Chaired by Sheikh Mohammed Bin Rashid Al Maktoum, UAE vice president and ruler of Dubai, ICD owns giant firms like Emirates Airline, the largest in the Middle East, Emaar Properties, the region's biggest real estate firm, and UAE's second largest lender, Emirates NBD bank.

      It said its revenues last year dropped by 1.9 per cent year-on-year to $62 billion over a decline in income from the energy and transport sectors.

      "In 2019, ICD produced a very solid performance given the considerable challenges faced by the global economy and the effect that these have had on our businesses," CEO Mohammed Ibrahim Al Shaibani said.

      "In 2020, with the significant disruptions arising in the wake of the COVID-19 crisis, we are focused on adjusting our operations to preserve their ability to operate competitively when the health crisis subsides," he said.

      Unlike in the rest of the Gulf, oil income is not a dominant factor and makes up just 6.0 per cent of Dubai's diversified economy which relies heavily on tourism, real estate and trade.

      ICD has wide-ranging investments in the financial services, transport, energy and industry, real estate and construction, hospitality and other sectors.

      Last year, the firm's assets rose to a record $305 billion from $240 billion in 2018.

PARIS — Automakers Renault, Nissan and Mitsubishi may unveil next week a new strategic plan to boost synergies and repair their troubled alliance as the coronavirus pandemic lashes the industry.

      The three announced on Tuesday they would hold on May 27 "a joint press conference regarding the progress in Alliance activities."

      The three announced in January they planned to deepen cooperation as concerns mounted their alliance would split apart, and they could unveil which companies will take the lead in certain technologies or regions in order to cut costs.

      The more than 20-year partnership between Nissan and Renault, based on cross-shareholdings without a joint structure, was built by Carlos Ghosn who held senior roles in both companies.

      Ghosn turned around Nissan's fortunes and then helped build the world's largest automotive group with the addition of Mitsubishi.

      But the alliance was pushed to the brink following Ghosn's shock arrest in Tokyo in November 2018 on charges of financial misconduct, including under-reporting millions of dollars in salary.

      The fortunes of all three automakers flagged even before the coronavirus pandemic, which has caused sales to plunge as governments forced citizens to stay at home to slow the spread of the virus.

      The day following the announcement, Nissan plans to unveil restructuring measures along with results for its 2019-2020 fiscal year that are expected to show the automaker suffered a loss.

      Then it is Renault's turn on Friday, with the automaker having already said in February it aimed to achieve two billion euros ($2.2 billion) in savings over three years and did not exclude closing factories.

      Renault registered its first loss in more than a decade last year, its credit rating has been downgraded into junk territory by Standard and Poor's, and it is in line to receive a five billion euro loan backed by the French state to help it overcome the crisis.

      Ghosn, who denies the financial misconduct charges, fled to Lebanon after being released from a Japanese jail and is being pursued by both Renault and Nissan on civil charges, while French prosecutors are also looking into whether he wrongly obtained use of the Palace of Versailles for his lavish 2016 wedding.