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BERLIN — Chancellor Angela Merkel’s conservatives promised Germans more police, more homes and full employment within eight years when they presented their programme on Monday for an election in which she will seek a fourth term in office.

With Europe’s biggest economy growing robustly, Merkel’s Christian Democrats (CDU) and their Bavarian sister party, the Christian Social Union (CSU), are able to offer voters tax relief and more investment after the September 24 ballot. The allies have put aside their differences over migrants - the CSU wants a cap to which the CDU will not agree - and German media have reported that conservative lawmakers now refer to Merkel and CSU leader Horst Seehofer as the “twins”.

The conservatives hold a clear opinion poll lead over the centre-left Social Democrats (SPD), but would still need to team up with another party to govern.

On Monday they added the goal of full employment — which they define as a jobless rate of less than 3 per cent — by 2025 to their list of campaign pledges.

“We think we can do this,” Merkel told a news conference with Seehofer convened to present the election programme, adding that jobs were central to the quest for “prosperity and security for all’’.

Germany’s jobless rate is currently at a post-reunification low of 5.5 per cent. A level of 3 per cent has not been seen since the “Economic Miracle” boom of the mid-1970s.

The conservative parties want to add 15,000 police officers in the 16 federal states, build 1.5 million homes during the next parliamentary term, and expand Germany’s broadband network.

This responds to pressure from the International Monetary Fund and European Commission, which have said Berlin has room to lift investment infrastructure, which would help reduce its huge current account surplus and benefit weaker euro zone peers.

CAIRO — Hisham Gaber had been preparing his wedding for months, but started to have second thoughts as inflation in Egypt rocketed due to government austerity measures, including sharp increases in fuel prices.

"Marriage and handling the additional burdens in these conditions have become an unsound decision," said the 28-year-old engineer.

The government on Thursday announced an increase in fuel prices of up to 55 per cent, the second since November when it also floated the currency in an IMF-backed reform programme, which fuelled inflation.

Analysts believe the fuel price rises will further increase inflation although it was announced to have decreased in May to an annual rate of 30.9 per cent, from 32.9 per cent the previous month.

"Prices are still rising, but not as sharply as before," said Amr Adly, an analyst with the Carnegie Middle East Center.

Radwa El Sweify, an analyst with Pharos Holding for Financial Investments, believes that inflation will spike.

"Inflation over the next 2 months may rise to 34-36 per cent but the rate of inflation in the last 2 months of this year will be less than the same period last year when the pound was floated," she said.

The pound has depreciated sharply from 8.8 per dollar to 18 — following its flotation, which came after the International Monetary Fund agreed a $12 billion loan disbursed over three years.

The move, in a country that relies on imports, drove inflation to a record high in April.

"The exchange rate is key to price fluctuations in a country where food and medicine make up more than 40 per cent of imports," said Adly.

'Prices have tripled'

The government has announced a raft of measures to protect low income Egyptians, saying it boosted social spending to 75 billion pounds ($4.1 billion).

About 28 per cent of Egypt's 90 million people are poor, according to official figures from 2015.

But government social spending will cover only between 40 per cent and 50 per cent of the recent price hikes, said El Sweify.

"The government doubled social spending, but prices have tripled," she said.

With the latest fuel increases that affect transport costs, the prices of vegetables and fruits may rise by between 20 and 25 per cent, said Omar El Shenety, the founder of Multiples Group, an investment firm.

Prime Minister Sharif Ismail said the fuel subsidies were straining government financing.

The projection for next year at the same levels "is 150 billion pounds. This is a big number that neither the oil sector nor the budget can handle", he said at a press conference.

But despite widespread consternation among Egyptians, it is unlikely that the soaring cost of living will lead to unrest, El Shenety said.

"The government's conviction that there will not be a backlash by people allowed it to make these reforms forcibly," he said.

Economic grievances had fuelled the 2011 uprising that overthrew veteran strongman Hosni Mubarak, ushering in years of unrest that decimated tourism and investment.

Many Egyptians now are weary of further unrest, while the government shows little tolerance for dissent, having jailed thousands of Islamists and secular dissidents over the past few years.

President Abdel Fattah Al-Sisi, the former army chief who toppled his Islamist predecessor Mohamed Morsi in 2013, has said the country has no choice but to undertake the tough economic reforms his predecessors had put off, fearing unrest.

NEW YORK — Samsung plans to invest $380 million and hire nearly 1,000 workers for a new plant in South Carolina to manufacture home appliances, the company announced on Wednesday.

Samsung Electronics America described it as a “state of the art” facility that starting next year will build premium home products, including washing machines, and will be staffed with craftsmen, engineers and operators.

US Commerce Secretary Wilbur Ross, who is leading President Donald Trump’s “America First” manufacturing and trade strategy, applauded the announcement and appeared at a signing ceremony with South Carolina officials.

Ross said in a statement the investment was “a direct reflection of the fact that America is becoming an even stronger destination for global businesses looking to grow”.

Samsung said ultimately facility in the southern US state will be “serving as the US hub for home appliance manufacturing across the business unit”.

“For nearly 40 years, Samsung has steadily expanded our operations in the United States,” said Tim Baxter, chief executive of Samsung Electronics America.

“With this investment, Samsung is reaffirming its commitment to expanding its US operations and deepening our connection to the American consumers, engineers and innovators who are driving global trends in consumer electronics.”

The company alluded to incentives granted by the state government as a factor in the decision to invest in the project, which upgrades a plant formerly owned by machinery manufacturer Caterpillar. 

The South Carolina commerce department said it approved job development credits for the project by the South Korean technology giant. The facility also will receive $2.75 million in incentives from Santee Cooper, an electric utility owned by the state, the Post & Courier newspaper reported.

A Samsung spokesperson declined to comment on the incentives package. On its website, the South Korean company said the investment decision was driven by the high-skilled workforce in South Carolina, the state’s record in attracting and retaining other global businesses, “strong local government leadership” and strong highway and port facilities.

The Samsung spokesperson denied news reports saying the company was moving operations to South Carolina from Mexico.

“We’re expanding our footprint in the US to meet the surging demand for our products in that market and to increase the speed with which we can adapt our products to the preferences of American consumers,” she said.

“Mexico is an important market for Samsung and our manufacturing operations in the country continue to serve as a major production bases for the company in Latin America.” 

BRUSSELS — EU leaders on Friday poured cold water on a proposal by French President Emmanuel Macron to hand Brussels more powers to control Chinese investments in strategic European industries.

European leaders discussed the divisive topic on the second day of an EU summit in Brussels, as Europe seeks to lead on free trade in response to the protectionist policies of US President Donald Trump.

The election of the “America First” tycoon has sown confusion in Europe, with pro-free trade leaders urging that the EU take leadership and sign new trade deals with Japan, Mexico and South America.

But the reformist Macron, France’s freshly elected new leader, wanted to put a special focus on the wave of blockbuster investments by China in Europe that has spooked some member states, including Germany.

“Fairer trade is preferable than the law of the jungle,” said Macron after the summit in a joint press conference with German Chancellor Angela Merkel.

Macron blames Europe for forgetting EU citizens who are worried about globalisation, so helping stoke the populist sentiment that brought on Brexit.

But Macron’s idea on investments was significantly watered down after facing opposition from Spain, Greece and the Portugal, all unwilling to thwart Beijing investments in their economies.

“There was clearly a push by Macron and resistance by others,” an EU source said after the summit talks dragged on over the issue.

“Countries like Portugal, Greece and Spain are eager to take Chinese money to get their heads out of the water,” the source said. 

Other countries were wary of offending powerful China, or of giving Brussels fresh powers over national economic policy.

As a gesture to Macron, EU governments had agreed to include the idea in the summit conclusions, with leaders eager to reward his solid defeat of far right Marine Le Pen in elections last month.

“I personally want a Europe that is open but that isn’t handed away on a plate,” EU Commission Chief Jean-Claude Juncker said in support of Macron.

But in the summit conclusions, leaders stopped well short of an EU-wide policy of screening strategic investments from third countries, agreeing only to “analyse” them.

At the same time, this would be done while “fully respecting member states’ competences.” The summit was less divided on finding ways to set up stronger anti-dumping defences against China and other countries.

Beijing has faced international condemnation for flooding the world with super cheap steel, solar panels and other products, leaving international rivals on their knees. 

EU leaders also urged EU institutions to swiftly implement anti-dumping measures currently under negotiation in Brussels.

TOKYO — Takata suffered another crushing collapse on Thursday, plummeting more than 50 per cent on fears the airbag maker at the centre of the auto industry’s biggest-ever safety recall is headed for bankruptcy.

The Tokyo-based car parts giant, facing lawsuits and huge recall-related costs over a bag defect linked to at least 16 deaths globally, has tumbled for four straight days. 

It is now worth less than a quarter of its value from just a week ago when a report by Japan’s leading Nikkei business daily said it would seek bankruptcy protection and sell its assets to a US company.

At Thursday’s close, the embattled stock had plummeted 55 percent to 110 yen ($1) from a day earlier.

“The shares are going to keep falling because the only buyers are day traders hoping to lock in gains from fluctuations in the price,” Hiroaki Hiwata, a strategist at Toyo Securities, told AFP earlier.

Another Nikkei report on Thursday said Takata, with liabilities exceeding one trillion yen, would file for bankruptcy protection as early as Monday.

Takata’s major automaker clients reportedly support the bankruptcy filing plan.

The scandal-hit airbag firm and some of its car customers are facing legal claims they knew about the problem and kept silent about it.

Millions of vehicles produced by some of the largest firms, including Toyota and General Motors, are being recalled because of the risk that an airbag could improperly inflate and rupture, potentially firing deadly shrapnel at the occupants.

The ultimate cause of the malfunctions has not yet been identified, but three factors are suspected: a chemical component, ammonium nitrate, that responds poorly to humidity; extreme climatic conditions, such as heat and high humidity; and faulty design.

 ‘No decision’ 

Takata issued a brief statement on Thursday that said “no decision of any kind has been made” on a bankruptcy filing.

A filing would clear the way for American autoparts maker Key Safety Systems, owned by China’s Ningbo Joyson Electronic, to take over the firm’s operations, the Nikkei has said.

Takata’s US-based unit TK Holdings is also expected to file for Chapter 11 bankruptcy.

Nearly 100 million cars, including about 70 million in the United States, were subject to the airbag recall, the largest in auto history, over the defective Takata airbags. 

Takata has already agreed to pay a billion-dollar fine to settle lawsuits in the United States over its airbags, and the company was heavily criticised for staying largely silent as the crisis grew.

“They should have been more upfront with the public and their customers in the early days to tackle this problem and take it more seriously,” said Hans Greimel, Asia editor for the Automotive News.

“In Japan you have that mentality...of trying to solve things in-house, reduce the embarrassment, get through it quietly and correct it for the future but don’t make a scene.

“I think that’s (been) changing over the years but it’s still evident in cases like this.”

The scandal has involved almost every major global automaker, including top client Honda, which has already written down huge costs linked to the crisis.

The new company created under Key Safety would reportedly buy Takata’s operations and continue supplying airbags, seat belts and other products.

The downsized Takata would remain responsible for recall-related liabilities, the Nikkei said.

Little-known outside Japan, Takata was founded in 1933 as a textile company that evolved into an automotive parts giant selling airbags in the eighties.

It has dozens of plants and offices in 20 countries, including the United States, China and Mexico.

The airbag division has accounted for some 40 percent of its total revenue.

NEW YORK — Qatar Airways, its Middle Eastern business pressured by a diplomatic row with neighbours, is seeking as much as a 10 per cent stake in American Airlines, the US carrier said on Thursday.

The surprise investment push by Qatar Airways was disclosed by American Airlines in a securities filing Thursday saying the Qatari company planned to buy at least $808 million in American shares.

In addition, Qatar Airways' chief executive told his counterpart at American that the carrier sought a stake of about 10 per cent. 

"The proposed investment by Qatar Airways was not solicited by American Airlines and would in no way change the Company's Board composition, governance, management or strategic direction," American said in the filing.

American's bylaws require board approval to stakes of 4.75 per cent or more. Qatar Airways said it would not exceed this level without board approval and would "make all necessary regulatory filings" when required. 

"Qatar Airways sees a strong investment opportunity in American Airlines," the company said in a statement. 

"Qatar Airways believes in American Airlines' fundamentals and intends to build a passive position in the company with no involvement in management, operations or governance."

The move comes as Qatar faces conflict with neighboring countries after Saudi Arabia, Bahrain, Egypt and the United Arab Emirates severed ties over Doha's alleged support for extremist groups and Iran. The countries have suspended all flights to and from Qatar.

Qatar's government denies all the allegations.

Qatar Airways has downplayed the impact of the dispute on its business, saying on June 14 that the "vast majority" of its network was unaffected. But analysts have warned the profitable carrier could take a hit should the diplomatic crisis drag out. 

At the Paris Air Show this week, Qatar Airways was named the world's top airline for passenger service by Skytrax, a closely watched industry prize. 

Akbar Al Baker, the outspoken chief executive of Qatar Airways, used the occasion to blast Qatar's rivals in the region.

"At these difficult times of illegal bans on flights out of my country by big bullies, this is an award not to me, not to my airline, but to my country," he said.

'Open skies' controversy 

American also has had its differences with Qatar Airways, among other Middle Eastern carriers, over state subsidies the US air travel industry says violate international agreements. 

American chief executive Doug Parker has joined an effort with the leaders of Delta Air Lines and United Airlines to urge a crackdown by President Donald Trump on an alleged $50 billion in state subsidies to Qatar Airways and two other state-backed Middle East carriers that they argue allows those carriers to illegally compete in the US market.

The Qatar stake in American "does not alter American Airlines' conviction on the need to enforce the Open Skies agreements with the United Arab Emirates and the nation of Qatar and ensure fair competition with Gulf carriers, including Qatar Airways", American said in the filing.

"American Airlines continues to believe that the President and his administration will stand up to foreign governments to end massive carrier subsidies that threaten the US aviation industry and that threaten American jobs."

Qatar Airways already holds stakes in other foreign carriers, including a large holding in International Consolidated Airlines Group, the parent of British Airways. 

Shares of American Airlines jumped 1.7 percent to $49.24 in mid-morning trading.

DUBAI — Oil-rich Gulf countries, which for decades have attracted millions of foreign workers, thanks to their reputation as tax-free havens, aim to introduce value-added tax (VAT) in 2018 to plug budget gaps.

On top of administrative and technical hurdles, however, the project now faces an unprecedented diplomatic crisis after Saudi Arabia, the United Arab Emirates and Bahrain on June 5 severed all ties with Qatar, their partner in the Gulf Cooperation Council (GCC).

Saudi Arabia, the UAE and Qatar are due to introduce VAT in early 2018, with the other three GCC members — Bahrain, Kuwait and Oman — following at a later date.

In case of a prolonged crisis, Qatar would have to replace imports from Saudi Arabia and UAE, valued at $4.55 billion annually, with “costlier” non-GCC goods, said M.R. Raghu, head of research at the Kuwait Financial Centre.

“Implementing VAT in such a scenario would lead to inflationary pressures, especially in food-related items,” he said. 

“If the crisis is prolonged, then Qatar might want to delay the implementation of this envisaged tax reform to balance any spike in prices of commodities in the local markets.”

If it goes ahead as planned, VAT is unlikely to tarnish the GCC reputation as a low-tax region or reduce its appeal to expatriates, according to Monica Malik, chief economist at Abu Dhabi Commercial Bank.

An introductory rate of 5 per cent “looks to balance raising government revenue and still having a very attractive business environment, both for expatriates and corporations”, she said.

“We believe the UAE and the Gulf will still overall be seen as a low-tax environment on a global basis.”

VAT, a tax paid by the consumer, is also unlikely to deter businesses from setting up operations in the Gulf region, according to Jeanine Daou, indirect tax leader at PwC Middle East.

“From a business perspective, VAT should be neutral. What businesses are required to do is to collect tax on behalf of the government on their sales... It is not a corporate tax,” she said.

She said that 5 per cent would be “one of the lowest VAT rates across the globe”.

Worries of wholesale trader

But in Dubai’s old souk, a wholesale trader disagreed, expressing fear of having to bear the VAT cost due to low profit margins.

“I think 5 per cent will be too much,” said Obaid Tahiri sitting in his household appliances shop.

“For wholesale, we don’t have 5 per cent profit. Clients will not pay... I cannot increase the price for the customer.”

Although the UAE has announced plans to introduce VAT in January next year, many wholesale traders in the souk seem unaware of it.

“Until now, the government has not told us anything about tax,” said Abdullah Al Marzouqi, another trader.

The introduction of VAT is part of measures being taken by the energy-rich monarchies to reduce dependency on oil revenue and to diversify income.

“The governments’ objective is to diversify their revenue sources. It is about fiscal sustainability for the future. So, implementing VAT is an important tool allowing government to generate more revenue,” said Daou.

Although the 5 per cent rate is unlikely to address the fiscal pressure faced by Gulf governments, “it is a tool for future fiscal sustainability”.

Malik said the introduction of VAT across the six nations is expected to provide revenues of up to 1.5 per cent of total gross domestic product.

“The aim is not to end the fiscal deficit. It is rather to deepen and widen non-oil revenue,” she said, noting that hydrocarbons still account for between 50 and 90 per cent of government revenues in GCC countries. 

RAFAH, PALESTINIAN TERRITORIES — Egypt began on Wednesday to deliver a million litres of fuel to Gaza, a Palestinian official said, in an attempt to ease the Palestinian enclave’s desperate electricity crisis.

The fuel, trucked in through the Rafah border between Egypt and Gaza, will be routed to the territory’s only power station — closed since April due to fuel shortages.

The deliveries come two days after Israel began reducing its electricity supplies to Gaza, following Palestinian President Mahmoud Abbas’s decision to stop paying for them.

Wael Abu Omar, the Rafah crossing spokesman, told AFP that eight shipments had entered, with a further 14 expected later in the day.

“A million litres of fuel for the power plant will enter today,” he said.

That is enough to enable the power station to operate for two to three days, Samir Moutair, director general of the Gaza electricity company, told AFP.

Residents of impoverished Gaza — where two million people live fenced in between Israel, Egypt and the Mediterranean — were already receiving only a few hours of mains power before this week.

Israel had been supplying 120 megawatts of electricity to Gaza a month, making up around a quarter of the territory’s needs, with the Abbas-run Palestinian Authority paying the 11.3 million euros ($12.65 million) monthly bill.

But after Abbas announced he would no longer pay, the Israel Electric Corporation said power supply would “effectively be reduced on two lines out of 10 every day, until the reduction applies to all 10 lines”.

The move threatened to leave Gazans with as little as two hours of power a day, prompting a UN warning that basic services in the enclave faced “total collapse”.

The Egyptian response temporarily eases the crisis and Abu Omar said further deliveries were expected before on Saturday, ahead of the Muslim festival of Eid Al Fitr marking the end of the holy fasting month of Ramadan.

Abbas’s decision to cut funding came amid a persistent rift with rival Palestinian movement Hamas, which runs Gaza.

The Islamists seized control of Gaza from Abbas’s Fatah movement in a near civil war in 2007 and multiple attempts at reconciliation have failed.

However, the Palestinian Authority had continued to pay Israel for some electricity delivered to Gaza until this month.

Israeli human rights group Gisha said in a statement on Monday that by reducing supplies “Israel is knowingly aggravating an already dangerous situation in which the strip is teetering on the verge of a humanitarian crisis”.

Hamas, which swept Palestinian parliamentary elections in 2006 but remains blacklisted as a terrorist group by the European Union and the United States, has fought three wars with Israel since 2008.

LONDON — Britain’s Serious Fraud Office (SFO) said on Tuesday it had charged Barclays, a former chief executive of the banking giant and three other ex-managers, with “conspiracy to commit fraud” linked to emergency fundraising from Qatar during the financial crisis.

The SFO added in a statement that former chief executive John Varley was one of those to face court following a five-year investigation.

“The Serious Fraud Office has today charged Barclays Plc. and four individuals with conspiracy to commit fraud and the provision of unlawful financial assistance” linked to capital raising from Qatar in 2008 worth billions of pounds (euros/dollars).

“The charges relate to Barclays Plc.’s capital raising arrangements with Qatar Holding LLC. and Challenger Universal Ltd., which took place in June and October 2008,” the SFO said.

It added that they relate also to a $3-billion loan facility made available to the State of Qatar acting through the country’s Ministry of Economy and Finance in November 2008.

The other three charged are Barclays’ former executive chairman of investment banking Roger Jenkins, the former chief executive of Barclays wealth and investment management Thomas Kalaris and former European head of financial institutions group Richard Boath.

The defendants will appear before London’s Westminster Magistrates’ Court on July 3, the statement added.

In a separate statement, Barclays said it “is considering its position in relation to these developments” as it “awaits further details of the charges from the SFO”.

Bailout avoided 

UK watchdog the Financial Conduct Authority (FCA) already fined Barclays £50 million in 2013 after the bank failed to disclose fees it paid to the Qatari investors. Barclays contested the fine however, which has been on hold awaiting the SFO outcome. In addition, US authorities are probing the payments.

In a statement on Tuesday, the FCA said: “We welcome a fair and transparent hearing on the basis of the charges set out today by the SFO.”

SFO Investigations had focused on advisory services worth £322 million, which Barclays agreed to pay the Qatar Investment Authority.

By raising money from Qatar, Barclays avoided a UK government bailout at a time when rivals Royal Bank of Scotland and Lloyds had no choice but to be pumped with billions of pounds of British taxpayers’ money.

Speaking to BBC radio on Tuesday, former treasury minister Paul Myners said Barclays bosses were “vehement” that they did not want a government bailout in 2008.

“I think firstly there was a real fear on their part that this was nationalisation, it was political, they didn’t want anything to do with a Labour government,” Myners said.

“Secondly, they realised that the terms we were imposing meant that pay for their senior bankers and bonuses and options were going to be substantially reduced. So they managed to find capital from elsewhere.

“That surprised a lot of people, and that is the background to the investigation that the SFO has now been conducting for the last five years,” he added.

Tuesday’s announcement meanwhile comes as current Barclays Chief Executive Jes Staley is facing a probe by regulators after he tried to uncover the identity of a whistleblower.

Around 1000 GMT, shares in Barclays were down 0.3 per cent at 206 pence on London’s benchmark FTSE 100 index, which was flat overall.

“The muted reaction in the share price highlights the fact that the SFO action was largely priced in,” said Laith Khalaf, senior analyst at stockbroker Hargreaves Lansdown.

“Litigation, fines and compensation payments have sadly become part and parcel of the banking world.”