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NEW YORK — Curbing corruption could generate about $1 trillion in tax revenues annually across the world, according to research from the International Monetary Fund (IMF).

In addition to increasing government revenue, fighting corruption can also reduce waste and even help to lift test scores among public school students, the IMF said. It also improves overall public trust in the government.

"Less corruption means lower revenue leakage and less waste in expenditures, and higher quality of public education and infrastructure," said the report.

The pattern of lower corruption perception and higher revenues is maintained across developed, emerging and low-income countries, the data showed.

"Among advanced economies, a country in the top 25 per cent in terms of control of corruption collects 4.5 per cent of GDP more in revenues, on average, than a country in the lowest 25 per cent. The gap in revenue collection is 2.75 per cent of GDP among emerging market economies and 4 per cent of GDP among low-income countries," said the report.

Transparency, strong press are key 

Previous studies showed that extractive industries like mining and oil drilling are hotbeds for corruption, as are procurement and the administration of state-owned enterprises. The fund focuses on transparency and oversight as key elements in curbing corruption in these areas, with a strong, free press as catalyst.

"We expected transparency would go together with good fiscal outcomes, but what surprised us is that the effect of transparency is much stronger in countries that have a free press or a [strong] civil society," said Paolo Mauro, deputy director in the IMF's Fiscal Affairs Department.

"And when you have those two together the effect is even stronger."

Mauro and Paulo Medas, a deputy division chief in the same IMF department, co-authored the study, a chapter of the fund's Fiscal Monitor, which is being published in parts this week ahead of the IMF's spring meetings scheduled next week in Washington.

Among other recommendations to curb corruption, the fund calls for the professionalisation of civil service, including merit-based hiring, as well as the need for simple tax rules and business codes to avoid the temptation of bribes to navigate them.

The report recommended technology that can fight corruption. For instance, it said, taking procurement on line is seen as a rapid and inexpensive part of the anti-corruption puzzle.

So-called e-procurement "is a relatively cheap initiative that can open competition, so you can have bidders from any place in the country or the world and it makes it very cheap and transparent for companies to bid," said Medas.

Chile and South Korea are cited as examples in the effectiveness of e-procurement, while Rwanda and Georgia show some of the highest increases in revenue collection relative to GDP. 

Emerging countries' dependence on extraction of raw materials for economic development gives them an added incentive to curb corruption and makes success even more important.

"You want to invest in very good institutions, extremely high levels of transparency and very intrusive external oversight," said Medas.

The trillion in added tax revenues comes on top of a previous study that stated that corruption in the public sector costs between $1.5 trillion and $2 trillion annually in bribes alone.

LONDON — Australia's dollar and the Chinese yuan gained on Wednesday on hopes for an agreement between Beijing and Washington to end their trade conflict.

Reports of progress in trade talks between the United States and China, as well as reassuring factory activity data from both countries, has supported markets in recent days and sent Asian stocks to seven-month highs.

For currency markets, that meant a rebound in the Aussie, long seen as a proxy for China given Australia's export industries, and China's yuan. 

The Aussie rose 0.7 per cent to $0.7119, recovering most of the losses it suffered on Tuesday after a central bank meeting. The New Zealand dollar also firmed.

The yuan rose 0.2 per cent in offshore markets to 6.7115, with analysts citing both improved optimism about momentum in the Chinese economy and the trade negotiations with the United States.

"The conclusion is that the trade talks this week is crucial — either a deal can be done, or the negotiation will be extended again to June at least," Commerzbank analysts said in a note. 

Sterling adding to its overnight gains after Prime Minister Theresa May announced talks with the opposition Labour party in a bid to break the Brexit deadlock that may lead to a softer departure deal with the EU.

The euro rose 0.3 per cent as the dollar pulled back from its recent highs, touching $1.1240 as the European session got underway. The single currency had fallen below $1.12 on Tuesday, nearing a 21-month low, as worries over the relative weakness in the euro zone economy sent investors into dollars.

The greenback dropped against its rivals, with its index down 0.3 per cent to 97.053 after climbing to a 3-1/2-week peak of 95.517 the previous day.

Central banks have turned more dovish this year as they look to avert an economic slowdown, led by the Federal Reserve.

JP Morgan Asset Management's currency chief investment officer Roger Hallam said that if the European Central Bank decided to reduce interest rates further, "such an outcome would likely push EURUSD below $1.10."

Against the yen, however, the dollar rose 0.2 per cent as the rally in risk assets undermined demand for a currency that investors typically buy when they want safety.

The Japanese currency dropped to 111.525 yen per dollar.

With risk appetite recovering, the Swiss franc also fell, putting it at 1.1201 francs per euro. It had strengthened below 1.12 earlier in the week.

CAIRO/DUBAI — With steaming plates of rice and freshly sliced apples on the side, a group of Cairo-based food scientists work in their lab to decide whether the foreign grains will suit Egyptian palates.

The scientists cook and taste samples of rice on offer at state tenders before they are accepted. The process, which began late last year, has so far eliminated Indian origin rice and approved of Chinese and Vietnamese offers.

Egypt has spent $46.8 million on Chinese rice in two tenders since November. A third is ongoing.

Egyptians are major rice consumers and take pride in the quality of their local crop. But after planting less local rice in 2018 to conserve water, Egypt tapped the international market in November, requesting samples for a cooking test. 

Rice is a heavily discounted staple on Egypt's subsidy programme, under which the state purchases foodstuffs that are offered to subsidy card holders, currently around 60 million people. 

The scientists' role is to ensure that the rice bought by the state is suited to familiar cooking methods and tastes. 

"Here, as a unit, we are all [academic] doctors as well as mothers in our homes," said Nahed Lotfy, director of the test kitchen. "We are all trained judges who have completed training courses."

Samples are anonymised, said Nasra Ahmed, one of the taste testers. "We get a sample on which we have almost no information at all," she said. "Everything arrives with a code." 

Researchers inspect grains for water absorption, colour and smell. After cooking, the rice is presented to the tasters.

"We evaluate the product based on colour, taste, aroma, flavour, as well as general response," Lotfy said.

Researchers cannot wear perfume or smoke cigarettes. Sliced apples and water act as palate cleansers.

Pushing up costs 

Traders say the taste test drives up costs by forcing them to keep their offers open indefinitely while it takes place. They say the testing process is unique to Egypt.

"It is something that doesn't happen globally," Mostafa Al Naggari, a major Egyptian rice exporter and importer, told Reuters. "In other countries, the cooking instructions are simply written on the packet." 

On the private market, importers have contracted to bring in 150,000 tonnes of Indian rice from October until end April, with no complaints from Egyptian consumers.

Naggari, who buys Indian rice to supply Egypt's private market, said he was not clear why Indian samples had failed the test.

"These are the rules of the tender and we will respect it, but I am happy selling rice on the private market." 

But Nomani Nomani, an adviser to the supply minister, said the cooking tests were necessary to avoid the rice piling up in subsidy stores like it did three years ago when Egyptians refused to buy it. 

"Of course, if an Indian rice sample that suits Egyptian taste is presented, we will accept it, but the cooking test is necessary to make sure the rice we are importing suits consumers," he told Reuters.

NEW YORK — Oil climbed more than 1 per cent with US crude futures hitting a 2019 high on Monday after tight supply and positive signs for the global economy drove both benchmarks' largest first-quarter gains in nearly a decade. 

US West Texas Intermediate (WTI) futures were up 85 cents, or 1.4 per cent, at $60.99 by 10:30 am ET (14:30 GMT), after reaching their highest in more than four months at $61.15. WTI gained 32 per cent in the first quarter.

Brent crude for June delivery was up 93 cents, or 1.4 per cent, at $68.51 after rising by more than a dollar in earlier trading and gained 27 per cent in the January-March period.

Production cuts from the Organisation of the Petroleum Exporting Countries (OPEC) helped push supply to a four-year low in March, a Reuters survey found, as top exporter Saudi Arabia over-delivered on the group's supply-cutting pact while Venezuelan output fell further due to US sanctions and power outages.

The energy complex is off to a strong start with help from favourable Chinese data and associated weakening in the US dollar, Jim Ritterbusch, president of Ritterbusch and Associates, said.

"This bull market in energy that has entered its fourth month in duration appears capable of continuing," he said.

US construction spending increased for a third straight month in February, offering some good news on the economy following a string of weak reports.

The US data followed positive Chinese factory gauges and signs of progress in Sino-US trade talks have boosted sentiment, helping to buoy regional stock markets.

The United States and China said they made progress in trade talks that concluded on Friday in Beijing, with Washington saying the negotiations were "candid and constructive" as the world's two largest economies try to resolve their trade war. 

China's State Council said on Sunday that the country would continue to suspend additional tariffs on US vehicles and auto parts after April 1, in a goodwill gesture following a US decision to delay tariff hikes on Chinese imports.

Analysts have turned cautiously optimistic on the oil market, a monthly Reuters poll showed on Friday, lifting their forecast for the average Brent price in 2019 for the first time in five months to $67.12.

Hedge funds and money managers raised bullish wagers on US crude to the highest in more than five months, the US Commodity Futures Trading Commission (CFTC) said on Friday.

Brent crude speculators also raised net long positions by 13,429 contracts to 322,035 in the week to March 26, data from the Intercontinental Exchange showed. That was the highest level since late October.

On the supply front, booming American production has steadied, with the US government reporting on Friday that domestic output in the world's top crude producer edged lower in January to 11.9 million barrels per day. 

US energy companies last week reduced the number of oil rigs operating to the lowest level in nearly a year, cutting the most rigs during one quarter in three years, energy services firm Baker Hughes said. 

Meanwhile, oil prices are being propped up by US sanctions on Iran and Venezuela along with voluntary supply cuts by the OPEC and other major producers.

Output from OPEC countries fell by 280,000 barrels per day (bpd) from February to 30.4 million bpd, according to a Reuters survey, its lowest monthly rate since 2015.

Washington has instructed oil trading houses and refiners to further cut dealings with Venezuela or face sanctions themselves, sources told Reuters, and has urged Malaysia and Singapore to be vigilant for illicit Iranian crude in its waterways. 

BEIJING — China's State Council said on Sunday that the country would continue to suspend additional tariffs on US vehicles and auto parts after April 1, in a goodwill gesture following a US decision to delay tariff hikes on Chinese imports. 

In December, China said it would suspend additional 25 per cent tariffs on US-made vehicles and auto parts for three months, following a truce in a trade war between the world's two largest economies.

The State Council, or Cabinet, said Sunday's move was aimed at "continuing to create a good atmosphere for the ongoing trade negotiations between both sides". 

"It is a positive reaction to the US decision to delay tariff hikes and a concrete action adopted [by the Chinese side] to promote bilateral trade negotiations," the State Council said.

"We hope the US can work together with China, accelerate negotiations and make concrete efforts towards the goal of terminating trade tensions."

The government also said it would announce separately when the suspension would end.

US President Donald Trump said on Friday that trade talks with China were going very well, but cautioned that he would not accept anything less than a "great deal" after top US and Chinese trade officials wrapped up two days of negotiations in Beijing.

US Treasury Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer were in the Chinese capital for the first face-to-face meetings between the two sides since Trump delayed a scheduled March 2 increase in tariffs on $200 billion worth of Chinese goods.

The talks are set to resume next week in Washington with a Chinese delegation led by Vice Premier Liu He.

LOS ANGELES/NEW YORK — Lyft Inc’s. shares rose as much as 23 per cent in their market debut on Friday, amid strong investor demand for the ride-hailing service that bodes well for larger rival Uber Technologies Inc.

Lyft’s IPO, which is the year’s biggest thus far, sets the stage for other Silicon Valley unicorns seeking to debut in the stock market this year, including Pinterest Inc., Postmates Inc. and Slack Technologies Inc.

The success of the IPO came despite Lyft’s steep losses, criticism of its dual-class share structure, and some concerns over its strategy for autonomous driving and new laws aimed at increasing driver pay.

Public market investors, keen on Lyft’s revenue growth and after enduring a long stretch with few IPOs from highly valued tech companies, piled into the offering.

“There’s money that wants to be invested into tech. This is a new area and people are definitely interested in exploring it,” said Catherine McCarthy, an Allianz research analyst. 

On Thursday, Lyft priced 32.5 million shares, slightly more than it was offering originally, at $72, the top of its already elevated $70-$72 per share target range, raising $2.34 billion in its initial public offering.

The stock opened at $87.24 but later pared gains to close up 8.7 per cent at $78.29, giving Lyft a market capitalisation of around $22.2 billion.

Lyft’s offering ended up 20 times oversubscribed, similar to other high-profile IPOs, with more than 500 orders from institutional investors such as mutual funds, according to people familiar with the matter.

Despite the optimism, there are also mounting concerns that these tech IPOs may be coming at the peak of the market, when the benchmark S&P 500 Index has risen more than 200 per cent since 2008.

Loss-making unicorns 

Lyft’s 2018 loss widened to $911 million from $688 million in 2017, despite revenue doubling in 2018 to $2.16 billion. The company has not laid out a timeline for when it will turn a profit. 

As a result, the IPOs of Lyft and other loss-making unicorns present a predicament for investors sitting on the fence — they do not want to miss out on popular companies with fast growth, but must weigh the risks of businesses with unproven economics.

“Every portfolio manager is going to have to make a decision in the next 12 to 18 months about these new IPOs. It’s a growing part of the market,” said JMP Securities President Mark Lehmann.

Uber, which is also loss-making, would be valued at about $128 billion at its IPO if awarded the same multiple as Lyft. Uber is planning to launch its IPO in April, sources have said.

Some of the companies’ losses come from subsidising rides, a tactic to attract riders with discounts. 

“With Uber and Lyft becoming public companies, shareholders will expect them to rationalise prices on rides towards sustainable levels,” said Paul Hudson, founding partner at Glade Brook Capital Partners.

Lyft, as of December, had 39 per cent market share in the United States, up from 35 per cent early last year. 

Its success in battling better-funded Uber for market share surprised even its own investors. 

“Nobody knew they [Lyft] would catch up to this level,” said Navin Chaddha, a venture capitalist with Silicon Valley firm Mayfield, which invested in Lyft in 2011.

From its earliest days, Uber aggressively outraised Lyft by billions of dollars, employing tactics such as prohibiting prospective investors who reviewed Uber’s financial data from investing in the smaller competitor. 

Just five years ago, some investors were convinced that Lyft would fail, and board members discussed finding a replacement for CEO Logan Green.

Lyft Chairman Sean Aggarwal said on Friday the company will continue to prioritise North American growth over international expansion after completing its IPO. Uber is in more than 70 countries, although it has consolidated certain overseas markets, while Lyft has stuck to the United States and Canada.

“Sticking with that playbook of owning this market [North America] and expanding in this market is how we get to deliver to our public shareholders and the long-term expectations that we set,” Aggarwal said on the sidelines of Lyft’s IPO celebration on Friday.

Lyft has explored expanding its service to Australia and Mexico, sources previously told Reuters.

Aggarwal also said the company’s co-founders, CEO Green and President John Zimmer, worked in recent weeks to make investors comfortable with Lyft’s dual-class share structure, which has faced criticism from some investors and corporate governance advocates.

Although it is common among highly valued tech companies, public market investors still balk at this structure, which gives founders more votes per share and outsized control of the company, long after it is startup-sized. Lyft’s structure will give the founders and certain other shareholders 20 votes per share.

Celebration at an auto dealership 

Instead of celebrating the first day of trading at the Nasdaq in New York, Lyft opted to mark the occasion at a defunct auto dealership in downtown Los Angeles.

Lyft’s staff, with family and friends, and Los Angeles Mayor Eric Garcetti gathered before dawn for the kick-off. The building, unmarked on the outside, gave away nothing about the celebration tucked away in the bowels of the old facility, which had been outfitted with pink confetti and Lyft-branded scooters.

Lyft recently bought the facility to turn it into a driver services center, the first of several it plans to open across the United States in the coming months, where drivers can obtain services like help with taxes or charging electric vehicles.

Garcetti said in his remarks that the old warehouse symbolises “a transformation of our economy”.

He pointed out that CEO Green is a native of Los Angeles, adding that “some good did come out of Los Angeles traffic”.

CAIRO — Egypt's President Abdel Fattah Al Sisi has raised the country's minimum wage to 2,000 Egyptian pounds ($116) a month from 1,200 pounds, he said at an event on Saturday celebrating women.

Sisi said the raise would apply to all Egyptian workers and added that pensions would rise by 15 per cent, with pensioners receiving a minimum increase of 150 pounds to take the minimum pension to 900 pounds.

"This was supposed to come out on June 30. But I said this matter cannot wait," the president said.

Egypt has implemented a series of tough economic measures, including devaluing the pound, slashing energy subsidies and introducing a value-added tax, to help meet the conditions of a $12 billion International Monetary fund (IMF) loan. The measures have left many of Egypt's nearly 100 million people struggling to make ends meet.

Remaining fuel subsidies are expected to be cut around mid-2019, and the petroleum minister said last month Egypt would implement an automatic price indexation mechanism on 95 octane petrol starting in April.

Under the measures announced by Sisi, state employees will receive a raise of 7 per cent, or a minimum of 75 pounds, while those not employed in the civil service will receive a 10 per cent raise, also receiving at least 75 pounds.

All state employees will also get a bonus of 150 pounds to help compensate for inflation, Sisi said, urging Egyptians to alter their spending behaviour to help combat rising prices.

"You want to control prices, don't buy things that get more expensive. The matter is simple. By God, by God, by God, anyone selling and buying wants to profit and be successful — if they find that their prices are exaggerated and people don't go buy their commodities, prices will fall," he said. 

The pay increases will cost the state 30.5 billion Egyptian pounds in total, Sisi said, noting that more than 300 billion pounds would be allocated for salaries in the 2019/2020 budget, up from 270 billion in the previous year.

CAIRO — Many of the Egyptians crammed into a tent in a Cairo suburb have been told they are about to be kicked off the government's food subsidy programme because they are too wealthy.

The reason may be a good job, a newish car, a big phone or electricity bill or expensive school fees.

Some people have travelled across the country to reach the tent — the only place where they have the opportunity to convince officials in person that there has been a mistake.

If they fail, they will no longer be able to use a smart card that gives them access to subsidised rice, pasta and other food staples.

Pensioner Gamal Abdel Shakour, one of hundreds of people gathered in and around the tent during a recent visit by Reuters, said he'd been wrongly identified as spending more than 800 Egyptian pounds on his monthly phone bill. 

"How can I be spending more than 800 pounds on my cellphone when my entire pension is roughly 650 pounds? Am I not going to eat?" said Shakour.

Changes to food support are highly sensitive in Egypt, where a decision to cut bread subsidies led to deadly riots across the country in 1977.

The latest effort to reform the 86 billion Egyptian pounds ($4.95 billion) a year food subsidy programme does not touch bread, the country's most important staple, and so far has only targeted one section of society — the better off.

But complaints over the implementation of the scheme are an early sign that Sisi's bid to rein in generous state subsidies used by more than 60 million Egyptians may not be easy.

The officials involved in the latest reforms relocated from an office in a smarter part of the capital after the crowds made locals nervous.

The changes to the subsidy programme that caused bread riots in 1977 were agreed as part of former president Anwar Sadat's International Monetary fund (IMF) loan deal. President Abdel Fattah Sisi's government has also turned to the IMF. In 2016, it signed a $12 billion loan. 

The lender has specified that food subsidies should only reach those most in need. The loan programme also involved raising fuel and electricity prices and a currency float. 

This has contributed to soaring inflation that has eroded consumer spending power. Cheap food has helped ease the pain. 

"With another round of steep energy subsidy cuts to be implemented this summer, the authorities would be mindful of not going overboard and risking food or hunger riots," Naeem Brokerage head of research Allen Sandeep said.

The government has said there will be two more phases of the subsidy card reform, but it has not said who will be targeted. 

Chairmen and generals 

The supply ministry made the first phase of changes to the programme in November when it removed people who were dead or living overseas and then said in February its next target would be those with higher incomes.

"We're talking about board chairmen, board members, head judges and generals, people like that," Supply Minister Ali Al Moselhy told Reuters.

The holders of around 400,000 subsidy cards received the notice at the bottom of their food receipts in March to say they would be removed from the programme in April, a spokesman for the ministry said. 

Along with the 800-pound cellphone bill limit, anyone who spends 30,000 Egyptian pounds ($1,727.12) per child on school fees annually, uses an average of 650KW of electricity per month, drives a car made in 2014 or later or has a high-paying job, would be automatically removed.

The ministry said it would accept complaints until the middle of April and they should be filed online. Many people were so worried that they wanted to do it in person instead. 

"I don't even have an electricity meter, how did they know my name and remove me for electricity consumption?" said Mahmoud Hassan, an older man from Cairo in the tent.

‘More needy people’

Sisi came to power after ousting former president Mohamed Morsi in 2013.

He hoped to repair the business environment and attract money back to Egypt after a 2011 uprising and the political turmoil that followed drove investors and tourists away. 

The three-year IMF loan, which will be completed in the second-half of 2019, unlocked badly needed funds that were tied to strict economic reforms. 

While the government has yet to spell out the next phases of the food subsidy reform, the IMF has stressed that it should be aimed at helping the less well off.

"The food subsidy programme remains poorly targeted and inefficient," IMF staff wrote in a regular review of Egypt's economy in January last year.

"Improving targeting could free up resources and reduce poverty among the low and middle income groups." 

The government has also been careful to say that the reforms are not aimed at shrinking the food subsidy bill, rather at targeting those most in need.

"We are here to provide social justice and social peace... We have to maintain our subsidy budget and manage it in a precise manner and to tell people, 'please there are real needs for people who are more needy'," Moselhy said on television.

Despite the complaints in the Cairo suburb, some poorer Egyptians support the food subsidy move. In a working class district of Cairo, one middle-aged woman was shopping for cooking oil. 

"It was the first time I've heard... that there are people who can spend 30,000 pounds on school fees," she said.

"What do they need our subsidy for?" 

LONDON — The British pound rose back above $1.32 on Wednesday as investors eyed receding no-deal risks on another day of high drama in the long-running Brexit saga.

Europe’s stock markets turned higher in afternoon trading, while Wall Street also climbed at the opening bell.

Asian equities mostly rose but traders remain on edge about the global economic outlook, while Brexit continues to hog the headlines.

Britain’s Parliament was due to hold a series of so-called “indicative” votes to seek an alternative Brexit solution as pressure continued to mount on Prime Minister Theresa May to resign if she wanted her own unpopular plan approved.

Sterling had rallied on Tuesday on fresh hope that May would avoid a chaotic no-deal departure from the European Union. Yet, risks remain, according to Societe Generale analyst Kit Juckes.

As uncertain as ever 

Brexit horror-show/soap opera was due to start with debates from 2pm (14:00 GMT) on various options for the way forward as the House of Commons takes control from the government, Juckes said.

“What happens next is as uncertain as ever and one thing is clear — the foreign exchange market... is still seeing risk and positions taken off the table.”

MPs will now choose whether to cancel Brexit, hold another referendum, vote for a deal including a customs union and single market membership, or leave the EU without a deal, though the government is not bound by law to implement the decision.

In a fresh twist, May’s twice-rejected divorce plan could be revived after Brexit hardliner Jacob Rees-Mogg — one of her most vociferous and high-profile critics — said he would back it, while another, Boris Johnson, hinted that he also could.

Wednesday was another... big day in the Brexit process but the indicative votes were not actually going to take place until 7pm (19:00 GMT), meaning any reaction to the results will have to wait until Thursday morning, said Spreadex analyst Connor Campbell.

Alphabet soup 

“Most investors’ attention [is] on Westminster and an alphabet soup of parliamentary motions that could shape the future direction of the Brexit grid lock,” said CMC Markets analyst Michael Hewson.

Brussels has given London a new extended deadline of April 12 to get May’s deal ratified or find a new way out. That replaced the previous Brexit date of March 29.

“Though avoiding a swift but hard Brexit is good news for the pound, going into a protracted period of uncertainty would continue to damage domestic industries and the currency,” said City Index analyst Fiona Cincotta.

DUBAI — Global ride-hailing giant Uber will acquire its Middle East rival Careem for $3.1 billion in the region's largest technology industry transaction, the two companies announced on Tuesday.

The deal boosts Uber's worldwide presence ahead of a keenly anticipated stock market debut.

"Careem and Uber are joining forces. We have reached an agreement in which Uber will acquire Careem for $3.1 billion," a joint statement said.

Under the deal, Careem will become a wholly-owned subsidiary of Uber but the two app-based transport and delivery companies will continue operating independently, the statement said.

Careem said it will retain its branding, services and separate app in the greater Middle East region. It is expanding its services to include mass transportation, delivery and payments.

Uber will pay $1.4 billion in cash and the remaining $1.7 billion in convertible notes, the joint statement said.

"Uber will acquire all of Careem's mobility, delivery, and payments businesses across the greater Middle East region, ranging from Morocco to Pakistan, with major markets including Egypt, Jordan, Pakistan, Saudi Arabia, and the United Arab Emirates," it said.

The acquisition comes as Uber prepares for its initial public offering — expected next month — which could, according to some estimates, see the rideshare giant's value increase to $100 billion.

 'Massive, untapped' 

Dubai-based Careem, established in 2012, boasts more than a million drivers and 30 million users across 120 cities in the Middle East and North Africa.

Uber, established in 2010, entered the Middle East market two years after the creation of Careem and the two companies remained in direct competition in a fast-developing market.

Uber chief executive Dara Khosrowshahi described the move as important for the company's expansion plans.

"This is an important moment for Uber as we continue to expand the strength of our platform around the world," Khosrowshahi said.

"Working closely with Careem's founders, I'm confident we will deliver exceptional outcomes for riders, drivers and cities, in this fast-moving part of the world."

Careem chief executive and co-founder Mudassir Sheikha welcomed the acquisition, saying it will be good for customers.

"Joining forces with Uber will help us accelerate Careem's purpose of simplifying and improving the lives of people, and building an awesome organisation that inspires," Sheikha said.

"The mobility and broader Internet opportunity in the region is massive and untapped, and has the potential to leapfrog our region into the digital future." 

The acquisition, which is subject to regulatory approvals, is expected to close in the first quarter of 2020.

The two companies said that together they will be better placed to improve the region's transportation infrastructure at scale and offer diverse mobility, delivery and payment options.

It will also speed up the delivery of digital services to people in the region through the development of a consumer-facing super-app that offers services such as Careem's digital payment platform (Careem Pay) and last-mile delivery (Careem NOW), they said.