Business

HAMBURG — The World Bank on Saturday launched a public-private loan programme aimed at providing over $1 billion to support women entrepreneurs in developing countries, a project first initiated by US President Donald Trump's daughter Ivanka Trump.

The event put a spotlight on the powerful political role Ivanka Trump plays in the White House, where she has a formal job as an adviser to her father, and has frequently met with world leaders, including German Chancellor Angela Merkel and Canadian Prime Minister Justin Trudeau.

The World Bank said initial funding of $325 million was coming from donors including Germany, the United States, Saudi Arabia and the United Arab Emirates, and would be matched by hundreds of millions of dollars in additional private capital.

"This is going to be what we hope will be a multi-billion dollar fund to support women entrepreneurs," World Bank President Jim yong-kim said at a launch attended by six of the 20 world leaders meeting at the G-20 summit in Hamburg and IMF Managing Director Christine Lagarde.

"This is not a cute little project. This is going to be a major driver of economic growth in the future... and it's going to drive gender equality at the same time," he said.

The programme, which aims to start awarding loans before year end, will work with governments "to improve laws and regulations that are stifling women entrepreneurs" and push banks to free up funds for female-owned businesses.

It will also create an online mentoring tool to match women business owners in developing countries with advisers such as Ivanka Trump, Kim said. 

Women business owners at the event said it was important to tackle legal barriers that prevent women from owning property and limit their access to funds.

"The empowerment of women is absolutely essential," United Nations Secretary General Antonio Guterres told participants, decrying what he called regression in women's rights even in industrialised countries.

Merkel said she was impressed how quickly the bank had realised the project, which was first initiated five months ago.

"If everything went as quickly at the World Bank — then we would be much more efficient," she said.

LONDON — Three of the West's biggest energy corporations are lobbying Qatar to take part in a huge expansion of its gas production, handing Doha an unintended but timely boost in its dispute with Gulf Arab neighbours.

The chief executives of ExxonMobil, Royal Dutch Shell and France's Total all met the Emir Sheikh Tamim Bin Hamad Al-Thani, in Qatar before it announced a plan on Tuesday to raise output of liquefied natural gas (LNG) by 30 per cent.

Company and industry sources told Reuters that the CEOs had expressed interest in helping Qatar with its ambition to produce 100 million tonnes of LNG annually - equivalent to a third of current global supplies - in the next five to seven years.

The companies already have large investments in countries on both sides of the dispute, and are keen to remain neutral after Saudi Arabia, the United Arab Emirates, Bahrain and Egypt severed ties with Doha on June 5.

Spokespeople from all three firms declined comment. However, a top executive from one energy major looking into expanding in Qatar said the huge business opportunity was worth the considerable political risk.

"There is only one policy here - you have to behave like a commercial corporation," the executive told Reuters. "You have to make your choices purely economically and be Qatari in Qatar, Emirati in the Emirates."

Energy sales have powered Qatar's rapid rise as a regional player since the late 1990s, and the oil majors' interest in the LNG expansion underline its longer-term economic muscle during the political row with its neighbours.

Chief executives Darren Woods of Exxon and Ben van Beurden of Shell both met the emir after the four Arab countries imposed the sanctions. Total chief Patrick Pouyanne has also visited Doha in recent weeks.

Qatar, the world's largest LNG supplier and second biggest gas exporter after Russia, has some of the lowest production costs. The plan was seen as an opening shot in a price war as Doha tries to defend its market share, especially against supplies from US shale deposits where costs are higher.

Willingness to invest 

The four Arab countries, which have demanded Qatar stop fostering terrorism and courting Iran, said after meeting on Wednesday that Doha's response to their grievances had been negative.

Saudi Foreign Minister Adel Al-Jubeir said the political and economic boycott would remain until Qatar improved its policies. Further steps would be taken at the appropriate time, he said. 

Doha denies aiding terrorism and its foreign minister, Sheikh Mohammed bin Abdulrahman Al-Thani, accused the four of "clear aggression" while adding that Qatar continued to call for dialogue to settle the dispute. 

Exxon, Shell and Total have already invested extensively in Qatar, particularly in projects to liquefy gas, allowing it to be shipped by tanker to consumer markets where transport by pipeline is not feasible. 

Woods met the emir on June 26, discussing "cooperation" with Qatar, where Exxon has been present since 1935, according to a statement carried by the state news agency. 

Industry sources close to the talks said that "the Exxon CEO was very keen to join the new gas capacity expansion and expressed willingness to invest".

Woods replaced Rex Tillerson, under whom Exxon helped to build Qatar's LNG industry until he left to become US Secretary of State earlier this year.

Exxon will be the largest foreign investor in Qatar in 2017, with most money going into LNG facilties, representing around seven per cent of its global portfolio, according to consultancy WoodMackenzie.

Shell's Van Beurden was among the first foreign company leaders to visit Qatar after the crisis broke out, meeting the emir on June 14. This was followed several days later by a new deal under which Qatar will supply Shell, the world's largest LNG trader, with 1.1 million tonnes annually for five years starting in 2019.

Shell's operations in Qatar include Pearl GTL, the world's largest gas liquefaction plant. Its overall investments in the state represent around six per cent of its global portfolio.

The three firms had been expecting Qatar to expand its LNG exports since it lifted a self-imposed moratorium on development of the North Field, the world's biggest natural gas field it shares with Iran, the sources said.

Oil and gas companies generally are no strangers to operating in risky areas. This week Total became the first Western energy firm to invest in Iran since the lifting of sanctions against the country. The project, phase 11 of Iran's South Pars development, draws gas from the same reservoir as Qatar's North Field. 

Total chief Pouyanne discussed new opportunities in the LNG sector as well as the company's plans to develop the Al-Shaheen oil field on his trip to Doha, according to a senior source.

Qatar's LNG capacity could be boosted by up to 10 million tonnes per year relatively quickly and cheaply by optimising existing facilities and upgrading a small number of units, a process known as "debottlenecking", according to a senior industry source.

Beyond that, the expansion would require building new liquefaction terminals involving significant investments, which the energy giants can offer. 

"Qatar LNG is really an important part of their overall portfolio, especially for Exxon but Total and Shell are also material LNG players there," Tom Ellacott, analyst at WoodMackenzie said.

"Qatar LNG is very competitive. Debottlenecking will be a relatively cheap option to increase capacity, but with the industry at a low point in the cost cycle, it may also be a good time to install new terminals."

BRUSSELS — The European Union and Japan reached broad political agreement on a historic free trade deal on Wednesday capping four years of negotiations, EU Trade Commissioner Cecilia Malmstroem said.

The hard-won deal marks a big win for free trade two days before a G-20 summit in Germany in which US President Donald Trump is expected to defend his “America First” protectionist stance.

“We’ve reached political agreement at ministerial level on an EU-Japan trade deal,” Malmstroem said in a tweet, after talks in Brussels with Japanese Foreign Minister Fumio Kishida.

The two sides “ironed out the few remaining differences” and will now “recommend to leaders to confirm this at summit” on Thursday, Malmstroem added.

Japanese Prime Minister Shinzo Abe is set to officially rubberstamp the outline of the trade deal at a meeting on Thursday with EU Council President Donald Tusk and EU Commission chief Jean-Claude Juncker.

The EU and Japanese economies combined account for a colossal 28 per cent of global output making the deal one of the biggest trade pacts ever attempted.

The “political agreement” on the trade deal covers some of the accord’s toughest aspects but leaves aside details that could still prove difficult.

At the heart of the accord is an agreement for the EU to open its market to the world-leading Japanese auto industry, with Tokyo in return scrapping barriers to EU farming products, especially dairy.

Left untouched for now are the controversial investment courts that have stoked opposition to trade deals in the EU nations, including Germany and France.

The deal could be seen as a provocation to Trump who pulled the United States out of the 12-nation Trans-Pacific Partnership this year, in favour of striking country-to-country bilateral deals, including with Japan.

The EU’s Malmstroem and Agriculture Commissioner Phil Hogan visited Tokyo last week to unblock the talks, with tariffs on European cheese a key sticking point.

Brussels wants Japan to eliminate its 30 per cent tariffs on some EU-made cheese, while Tokyo wants duties cut on cars which it exports to the 28-member bloc.

HANOI — Officials in Vietnam's traffic-choked capital Hanoi vowed on Tuesday to banish motorbikes by 2030 to ease environment and congestion woes, a decision that swiftly divided a city where two-wheelers are the main means of transportation.

Hanoi is famed for legions of motorbikes — sometimes stacked with entire families or overloaded with deliveries — that clog roads in a fast-growing city with limited public transportation.

There are five million motorbikes among a population of about seven million, compared to half a million cars on the road.

In a country where the average annual wage is still around $2,200, the affordability of motorbikes makes them ubiquitous.

Yet; critics have blamed the emissions-heavy motorbikes for Hanoi's deteriorating air quality and worsening traffic congestion.

The decision to ban motorbikes by 2030 was approved by 95 out of 96 city councillors at a meeting on Tuesday.

Officials said the number of vehicles was growing at an "alarming" rate, according to a report on the city government's website. "Traffic jams and air pollution will become serious in the future if no immediate management measures are in place," the report said. 

The ban will be implemented in metropolitan districts and public transport options would be increased to wean people off their scooters, the report added. 

The number of registered motorbikes in Vietnam is among the highest in Southeast Asia, and officials in Hanoi have long-mulled banning the bikes in an effort to modernise the city along the lines of Seoul or Tokyo.

Some welcomed the move, saying the ban is crucial to cleaning up Hanoi's air, which is notoriously smoggy in the winter months. "Too many private cars, too many motorbikes... the quality of air is really bad and the decision made today will improve that," economist and transport expert Luong Hoai Nam told AFP.

'Totally insane'

The city clocked 282 days of "excessive" levels of PM2.5 — fine particulate matter harmful to human health — last year, according to non-governmental group GreenID, citing World Health Organisation guidelines. 

The Hanoi government is rolling out an air monitoring system in an effort to make Hanoi "green and clean and civilised so that people living and working here have a high quality of life", Nguyen Trong Dong, the head of the city's environment department told AFP last month.

On social media, some people decried the motorbike ban announcement — questioning whether the government will really offer viable public transport alternatives as promised. 

"This idea is totally insane," said office worker Hoang Thuy Duong, who rides a motorbike to work daily. 

"Motorbikes are the best means of transportation in Hanoi. I doubt authorities can replace them with public vehicles," she told AFP.

Hanoi does not have a metro system, only public buses which account for 12 per cent of travel demand in the city. Officials said on Tuesday they plan to boost that share to around 50 per cent by 2030. 

Construction of a sky train in the city has been repeatedly delayed but is slated to open next year.

Some said limiting individual vehicle use is not effective without efficient public transport in place. 

"When you just employ banning as one measure, they never succeed," said Jung Eun Oh, senior transport specialist at the World Bank in Vietnam.

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.