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AMMAN — Battered by war which has inflicted incalculable damage on industry, infrastructure and economy, Syria's currency hit new lows last week after Russia said it was reducing its military support to President Bashar Assad.

The Syrian pound has fallen to 475 to the dollar on the black market, a 90 per cent drop since March 18, 2011, when security forces fired on protesters in the city of Deraa, sparking an uprising which descended into civil war.

Backed by financial and trade support from Iran, Syria's government succeeded in stabilising the pound early in the conflict.

But the slide accelerated as it lost control of territory and border crossings, trade collapsed, Western sanctions bit, Gulf Arab investment dried up, major cities were devastated and half the population was displaced.

The collapse of the currency has driven up inflation and aggravated wartime hardship, as Syrians struggle to afford basics such as food and power. Government budget spending in pounds has more than doubled, but in dollar terms has crashed.

Russia's surprise military intervention in September turned the tide of war in Assad's favour, but only briefly stemmed the currency's decline, and Moscow's declaration on Monday that it was pulling forces out of the country hit the pound again.

Panic

"In the last few days it came under further pressure because of the Russian announcement," a Damascus-based businessman said. "There was a lot of panic."

At the start of the uprising, the pound was around 47 to the dollar.

"Today, the [official central bank] intervention rate is around 406 but it reached 475 pounds in the black market," Hani Al Khoury, a financial consultant based in Damascus, said late on Thursday.

He said official efforts had prevented an even graver depreciation.

"Compared to the extent of the crisis and its devastating impact on the economy, the pound could have been far more affected," he told Reuters by telephone.

Infusions of money from Iran and dollar remittances from Syrians working abroad have also helped prevent an even steeper freefall, bankers say.

Iran is believed to have deposited hundreds of millions of dollars in the country's depleted reserves.

The government has also clamped down on currency exchanges in an effort to narrow the gap between official and black market rates. But in recent weeks, the official rate has fallen as fast as the black market, showing the limits of central bank influence.

Dollarisation

The pound's fall has pushed Syrian traders to switch their financing increasingly into foreign currency, Khoury added, a trend which may have been accelerated by the flows of billions of dollars of international humanitarian aid into the country.

"The Syrian economy has been dollarised — the import side and the financing side, along with savings and the aid coming from outside," he indicated.

That, combined with the continued pressures caused by the war, meant that whatever steps authorities take, the pound "is bound to continue to gradually drop".

"In every street in Damascus there is a different rate," the Damascus businessman said. "In Homs, Aleppo, Damascus, the black market rate varies."

He held out little hope of recovery for the currency without an end to hostilities. "Can you say whether the Geneva peace talks will succeed, or whether the armed groups will stop fighting?" he said.

Recently, Syrian businesswoman Reem Abu Dahab displayed her workshop's lacy pink and white nightgowns at a stall in a Beirut exhibition hall hoping to attract increasingly elusive buyers.

Syria's textile industry was once one of the country's economic bright spots, with its products coveted throughout the region and beyond.

But the sector, like the economy in general, has been devastated by the war that erupted in March 2011, with factories destroyed, workers displaced and sanctions hampering trade.

The migrant crisis and outflow to Europe have also depleted its workforce.

"Buyers used to come from all around the world but the war has scared them and now very few come to Syria," said Abu Dahab, surrounded by products made in a small workshop in Damascus.

Abu Dahab's family once owned a factory in Harasta, a Damascus suburb ravaged by fighting between rebels and the regime.

But it was completely destroyed in the war, and now the business is run out of a small workshop in the capital.

"We had 100 employees, today only 30 of them are still working for us," said Abu Dahab, who was one of around 100 Syrian textile manufacturers at a trade fair set up in Beirut.

Before Syria's conflict began, textiles represented some 63 per cent of the industrial sector's total production.

The sector was worth 12 per cent of gross domestic product (GDP), employed a fifth of the workforce and exports netted around $3.3 billion (3 billion euros) a year, according to the Syrian Economic Forum think-tank.

But by 2014, private sector textile exports had fallen by half, with the industry particularly affected by fighting in Aleppo city, the country's former commercial hub and home to many textile factories.

Factories destroyed, workers gone

"Seventy per cent of [textile] factories were closed or destroyed by the war," said Feras Taki Eddine, president of the Syrian Textile Exporters Association, next to a mannequin in black underwear and stockings.

In addition, many businesses lost machines and employees.

"Some of the machines were destroyed and some were stolen. Thieves took them to Turkey. I had 220 machines before, now I only have 10," said AlaaAldeen Maki, owner of Dream Girl Lingerie, an Aleppo-based business.

"Most of my employees emigrated because of the situation and some because they were forced to join the army for military service," he added.

When the war arrived in Aleppo in mid-2012, eventually dividing the city between government control in the west and rebel control in the east, some businesses relocated to small workshops in the city's safer areas.

Others, based in the relative safety of Damascus, have done whatever they can to survive.

Muhanad Daadush owns the country's biggest lingerie and pyjama factory, located in the capital.

He still employs 450 people, many of who sleep in the factory during upticks in violence.

"I had 72 workers sleeping at the factory" at one point, he told AFP at his stall, surrounded by bras of all hues and comfortable cotton sleepwear. "They started at six in the morning, worked until 11, then slept. They would only go home to their families from Thursday night to Saturday morning."

'Still alive'

For all its challenges, Syria's textile industry continues to enjoy a reputation of quality in the region, and the Beirut fair attracted some 500 buyers, mostly from the Middle East.

Fadi Baha was in town from Egypt, where he owns a chain of stores.

"I buy Syrian textiles because of their quality. It's better than Turkish or Chinese merchandise and almost competitive price-wise," he told AFP. "I like how Syrian manufacturers create a unique mix between Eastern and European styles."

But while regional buyers continue to purchase Syrian textiles, clients from further afield were nowhere to be seen.

Daadush Lingerie once exported 70 per cent of its products to Europe, but its owner said only 10 per cent now goes there.

And the rising costs of production, difficult trading environment and shrinking workforce, all mean competitors from Turkey and China are increasingly able to pinch clients from Syria's textile industry.

Manufacturers blame shrinking exports in part on sanctions slapped on Syria after the government began its crackdown on dissent following anti-government protests five years ago.

TakiEddine said Europe should be bolstering trade with Syria to keep citizens at work in their home country.

"It should be in Europe's interest to facilitate trade, because Syrian workers without jobs now want to leave to Europe," he added.

Several vendors said they were committed to staying open, ensuring jobs for Syrians and the industry's survival.

"It's important for us to show that Syrian industry is still alive," said TakiEddine.

KUWAIT CITY — Weak oil prices pose a threat to Gulf Arab states' currency pegs against the dollar, but the energy-rich region is unlikely to abandon the policy yet, analysts say.

Bahrain, Oman, Qatar, Saudi Arabia and the United Arab Emirates all keep the values of their currencies fixed against the greenback, while Kuwait has a link to a basket of currencies including the dollar.

But doubts are growing about whether the policy still makes sense.

The slide in oil prices has battered the economies of the six Gulf Cooperation Council (GCC) member states at a time when an improving American economy and prospects of higher US interest rates are lifting the dollar.

To maintain the currency pegs, all GCC members except Qatar raised their interest rates in December, tracking the US Federal Reserve, even though their economies needed exactly the opposite.

The Gulf states now face a dilemma of whether to keep the pegs or opt for a flexible exchange rate regime, allowing their currencies to fall against the greenback.

"Maintaining a peg is a costly affair. The central bank has to be willing to buy or sell its currency in the open market to maintain the peg, which could deplete forex reserves," said M.R. Raghu, head of research at Kuwait Financial Centre.

"Oil exports, which account for about 80 per cent of [GCC] government revenues, have fallen by 70 per cent since mid-2014, thus making the currency peg vulnerable as it reduces the foreign exchange reserves," Raghu added.

For now, GCC states, with the exceptions of Bahrain and Oman, have huge reserves to defend their pegs.

But some speculators are betting that the Gulf states, particularly Saudi Arabia, will be unable to maintain the currency links indefinitely.

Jan Randolph, director of sovereign risk analysis at IHS Global Insight, believes the contrasting performances of the US and Gulf economies will increase pressure on the pegs.

Monetary policies are also expected to diverge, "stimulating in the GCC and gradual tightening in the United States", Randolph said.

GCC states need weak currencies and low interest rates to boost their waning economies, especially to develop non-oil export sectors, Randolph indicated.

The longer the economic divergence continues, "the more sense it makes to move to a more flexible exchange rate regime", he added.

Maintaining the dollar pegs brings financial stability and certainty to GCC economies amid regional geopolitical tensions.

It also helps contain inflation and boost confidence for foreign investment.

Falling living standards 

Oil producers like Russia, Kazakhstan, Azerbaijan, and Nigeria have already devalued their currencies, raising oil revenues in local currency terms which helped to curb their current account and budget deficits.

But there is a cost.

Devaluation "typically causes higher inflation and often results in falling living standards, which can undermine social stability", Standard and Poor's said in a recent report.

Analysts say that if GCC states de-peg from the dollar, some currencies risk falling by 20 per cent or more.

That would boost oil revenues and the value of GCC fiscal reserves in their sovereign wealth funds in terms of local currencies, said Sebastian Henin, head of asset management at Abu Dhabi-based The National Investor.

The hospitality sector of the Gulf emirate of Dubai would also benefit as it becomes a more affordable tourist destination and more attractive to non-oil businesses, Henin indicated.

That is why some analysts and speculators anticipate that the United Arab Emirates could be the first to end its dollar link.

Another risk of abandoning the dollar peg is a capital flight from the Gulf, Raghu remarked.

"Capital outflows would be exacerbated as investors would like to move their assets to other markets. This would increase volatility and financial uncertainty in the region," he said.

Raghu thinks an end to the peg would happen "only as an extreme measure".

Mohamed Zidan, chief market strategist at ThinkForex, a Dubai-based brokerage firm, said the peg regime "is costly and hurting the economy".

"GCC states are defending it now for stability, but if the low oil price continues, they will opt for a managed floating regime within five years," he added.

AMMAN — Jordan Industrial Estate Company (JIEC) announced  on Saturday that a new Jordanian project, specialised in manufacturing Dead Sea products, was entering the Muwaqqar Industrial Estate with a JD1.5 million investment volume.

A JIEC statement said an agreement for the investment, which will provide around 45 job opportunities, was signed between Chief Executive Jalal Al Debei and Mohammad Al Rifai, general manager of La Cure Jordan for Dead Sea.

During the signing ceremony, Debei said the investment is a clear indication of the incentives issued recently by his company to create an attractive investment environment to establish projects. He added that industrial investments in general are "the best approach", highlighting the recent large investment specialised in manufacturing paper and cardboard.

Rifai described JIEC's incentives as encouraging and supportive to industrial investment, commending its role in the field. He said that Jordan enjoys many features to attract investments, yet the government must benefit from regional conditions and consider them "opportunities" to increase the volume of foreign investment. 

LONDON — Britain unleashed more austerity this week in its latest annual budget and cut its growth outlook, blaming the impact of global markets turbulence rooted in China. 

Finance Minister George Osborne also warned that a potential “Brexit”, or departure from the European Union (EU), would risk damaging the nation's economic recovery, ahead of a key referendum in June.

Chancellor of the Exchequer Osborne said the government would seek additional spending cuts totalling £3.5 billion ($5 billion, 4.5 billion euros) by 2020, when it expects to reach a budget surplus despite higher borrowing.

The chancellor pointed to a "dangerous cocktail of risks" including "turbulence in financial markets, slower growth in economies like China, and weak growth in the developed world" for the growth downgrades.

Analysts were meanwhile quick to point out that it was not clear which areas would bear the brunt of the latest cuts. 

"How these cuts will be made has not been outlined other than described rather vaguely as savings," said ING economist James Knightley. "With [government] department budgets already having been cut aggressively it will be interesting to see where new efficiency savings can be made."

In a speech lasting around one hour, Osborne forecast that the British economy was set to grow by 2 per cent this year, down from a November estimate of 2.4 per cent.

Growth was expected to stand at 2.2 per cent next year, down from 2.5 per cent.

Fiscal watchdog the Office for Budget Responsibility (OBR), which compiles official government forecasts, said the latest predictions were based on the assumption that Britain remained in the EU.

Osborne, a top figure in Prime Minister David Cameron's Conservative Party and government, also revealed plans to cut several taxes levied on businesses amid strongly divergent views from companies on whether Britain should quit the EU.

"This is a budget for small businesses," Osborne told lawmakers.

There were also significant tax cuts for the oil and gas industry, which has been hit by tumbling energy prices.

All eyes on Brexit vote 

Turning to Britain's June 23 referendum on EU membership, Osborne repeated the government's strong desire for the UK to stay within the 28-nation trading bloc.

"Britain will be stronger, safer and better off inside a reformed EU — and I believe we should not put at risk all the hard work the British people have done to make our economy strong again," Osborne told parliament.

Cameron is leading the battle to keep Britain in the EU, but several key members of his Conservative party, notably Mayor of London Boris Johnson, want to leave.

"There appears to be a greater consensus that a vote to leave would result in a period of potentially disruptive uncertainty while the precise details of the UK's new relationship with the EU were negotiated," the OBR said Wednesday, citing various external reports.

The government will meanwhile plough more cash into education and infrastructure projects. 

Osborne approved major railway developments in northern England and in London, and also unveiled a package of extra funding for education, which could see students being made to learn maths until the age of 18, up from 16.

In addition, Britain will impose a tax on excessive sugar levels in soft drinks starting in two years' time to cut down on spiralling childhood obesity levels.

With one eye on the referendum outcome, Osborne avoided traditionally unpopular vote-losing measures, like tax hikes on petrol and beer, and delivered only a very slight increase for tobacco.

"The chancellor had to tread carefully to avoid attracting the wrong kind of attention and undermining the government's popularity in the build up to the EU referendum," noted Scotiabank economist Alan Clarke.

Osborne on Thursday defended his plans to introduce a new sugar tax to tackle obesity, criticised as "absurd" by the soft drinks industry.

"There are always going to be people who will oppose these kinds of things — but I think this is going to be one of those landmark public health decisions that we take as a generation," Osborne told ITV News.

"It's disappointing that the government has chosen to single out soft drinks," said Jon Woods, general manager of Coca-Cola in Britain.

"If the aim is to reduce obesity, this levy flies in the face of evidence from around the world which shows taxes do very little, if anything, to reduce sugar and calorie intake or obesity levels but do add to people's cost of living," he added.

The levy on drinks with more than five grammes of sugar per 100 millilitres will be introduced in two years as Britain battles some of the worst obesity rates in Europe.

Only a handful of countries such as France, South Africa and Mexico have attempted such a tax. 

Osborne said Britain's childhood obesity problem was "really bad news", and that it was "clearer and clearer that the biggest source of sugar intake has been sugary drinks".

However, the drinks industry said it was already taking action to combat obesity and that other food-and-drink sectors needed to help shoulder the burden.

"In 2015 we agreed a calorie reduction goal of 20 per cent by 2020," said British Soft Drinks Association Director General Gavin Partington.

"By contrast, sugar and calorie intake from all other major take-home food categories is increasing — which makes the targeting of soft drinks simply absurd," he added.

According to 2015 figures, Britain is one of the worst countries in Europe for childhood obesity with 28 per cent of children aged between two and 15 overweight or obese. 

During his budget announcement, Osborne said that an average five-year-old child consumes his own body weight in sugar each year.

"We are going to use the money to double the amount we spend on sports in schools... so that kids are getting physical activity as well," he said Thursday.

Media reports suggest the tax could add 8p (0.10 euros, $0.11) to a can of cola. 

The government hopes the tax will raise £520 million a year (661 million euros, $732 million).

Osborne also unveiled new measures to raise taxes paid in the country by multinational companies, following a public outcry over methods used to avoid tax.

While corporation tax will drop from 20 per cent to 17 per cent in 2020, the finance minister set out a series of measures he said would increase British tax revenues by 9 billion pounds ($12.8 billion, 11.5 billion euro).

He added that the plan would "make Britain's business tax system fit for the future".

"It will deliver a low tax regime that will attract the multinational businesses we want to see in Britain, but ensure that they pay taxes here too," Osborne told the lower house of parliament.

"All of these reforms to corporation tax will help create a modern tax code that better reflects the reality of the global economy," he elaborated.

From April 2017, there will be a cap for the amount that major multinationals can deduct from their taxes by borrowing in Britain to invest elsewhere.

The treasury will also set new "rules to stop the complex structures that allow some multinationals to avoid paying any tax anywhere, or to deduct the same expenses in more than one country," Osborne said.

He added that the treasury would strengthen a withholding tax on royalty payments that allow some firms to shift money elsewhere.

There has been public outrage in Britain and other countries around the world over the tax arrangements of multinationals, particularly in the tech industry.

Earlier this year, US internet giant Google agreed to pay £130 million ($185.4 million, 172 million euros) to Britain following a government inquiry into its tax arrangement.

In early March, Facebook announced that it would declare advertising revenue from its top British clients in Britain instead of Ireland, where it has its European headquarters, meaning it should pay more tax.

There had been a backlash against the social network after it emerged that it paid only £4,327 (5,572 euros, $6,119) in corporate tax in 2014.

Osborne said the measures followed guidelines set out by the Organisation for Economic Cooperation and Development (OECD) economic grouping last year.

The OECD has estimated that national governments lose $100-240 billion (90-210 billion euros), or four to 10 per cent of global tax revenues, every year due to the tax-minimising schemes of multinationals.

AMMAN —  Preliminary results announced in a Hikma Pharmaceuticals press statement  this week showed group revenue for the year ended December 31, 2015, increased by 2 per cent in constant currency to  $1.44 billion in 2015.

"Injectables revenue climbed by 3 per cent in constant currency, driven primarily by growth in Europe and the Middle East and North Africa [MENA] region," the statment said. 

"Meanwhile, core operating profit rose  4 per cent in constant currency, with strong profitability in injectables and branded offsetting expected declines in Generics," it added, noting that the results followed an exceptionally strong year in 2014.

In 2015, Hikma successfully implemented an organic growth strategy across all three of its core business segments: injectables, branded and generics. Hikma launched 92 new products and received 220 product approvals across all countries and markets, expanding and enhancing Hikma’s global product portfolio. 

"Its acquisition of Roxane, a well-established US specialty generics company, has brought transformational scale and growth opportunities, adding a broad portfolio and a large, differentiated pipeline of niche products," the company continued in the statement.

"In addition, Hikma’s swift integration of its acquired US company, Bedford Laboratories, has delivered new high-value products and is expected to drive Injectables’ growth in 2017," it elaborated.

The statement indicated that in Europe significant investments were made in the injectables manufacturing capabilities and that  Hikma’s businesses in MENA performed well. 

The company credited its acquisition of EIMC United Pharmaceuticals (EUP) for boosting its capabilities in oncology and injectables in Egypt. 

"The outlook for 2016, is that group revenue is expected to be in the range of $2.0 - 2.1 billion in constant currency, reflecting strong growth across all three business segments and the consolidation of 10 months of revenue from the Roxane acquisition," it said.

The strong operational growth in various locations was coupled with responsible initiatives in surrounding communities. 

Contributing to the health and wellness of its employees and local community members, Hikma organised a breast cancer awareness campaign, in several of its companies worldwide, in addition to a “Walk Against Hypertension.” It also held its annual global “You are Hikma” campaign to improve the medical health and safety awareness of its employees. 

The company encouraged community service through its Global Volunteering Day. It partnered with Tkiyet Um Ali, Charity Clothing Bank and SOS Children’s Villages in Jordan to provide for the vulnerable during Ramadan, and food and clothes drives were held in Algeria and Tunisia as well. 

Hikma continued supporting communities through medicinal donations, donating critical treatments to Syrian and Palestinian refugees, and to the people of Guinea in Morocco, aiding in the fight against Ebola.

Said Darwazah, chief executive officer of Hikma, said:  "Following an exceptional 2014, our branded and injectables businesses performed strongly in 2015 and we made excellent strategic progress in US generics, transforming the future prospects of the group." 

"Our businesses in MENA are performing very well.  We achieved excellent growth in our key markets in 2015 whilst continuing to invest in our pipeline to support future growth," he added. 

"This goes hand in hand with our corporate responsibility strategy, which is an integral part of Hikma. As we expand into global markets, we are committed to continue playing a positive role in the communities we touch, not only through our high-quality pharmaceuticals, but also by promoting philanthropy, medical awareness and community engagement,” Darwazah concluded.

LONDON — Oil producers including Gulf members of the Organisation of Petroleum Exporting Countries (OPEC) support holding talks next month on a deal to freeze output even if Iran declines to participate, OPEC sources said, increasing the likelihood of the first global supply deal in 15 years.

That a meeting could go ahead with or without Iran indicates a shift in the stance of Gulf oil exporters including Saudi Arabia, who had previously maintained that all major producers should participate in any agreement.

OPEC and non-OPEC producers will meet in Doha on April 17, Qatari Energy Minister Mohammed Bin Saleh Al Sada said, following a February agreement between Saudi Arabia, Qatar, Venezuela and non-OPEC Russia to stabilise output.

"To date, around 15 OPEC and non-OPEC producers, accounting for about 73 per cent of global oil output, are supporting this initiative," Sada indicated in a statement. Qatar holds the OPEC presidency in 2016 and has been organising the effort.

Oil prices rose on Wednesday, supported by the announcement and on growing signs of a decline in US crude production. Brent crude was trading above $40 a barrel, up from a 12-year low of $27.10 reached in January.

The reluctance of Iran to join an accord while it seeks to boost its oil exports to recover market share after the lifting of Western sanctions has been cited by OPEC sources as a potential roadblock to an agreement.

Sources familiar with the matter said the issue was among the factors, which caused an earlier plan to hold the producer meeting on March 20 to be dropped.

But on Monday, Russian Energy Minister Alexander Novak said after talks in Tehran that a deal could be signed in April and exclude Iran. An exemption for Iran is not a deal breaker, OPEC sources said.

"It's a setback but it will not necessarily change the positive atmosphere that has already started," said one OPEC source from a major producer, referring to Iran saying it will not join any freeze accord.

Novak said he talked to Sada and Saudi Oil Minister Ali Al Naimi on Wednesday. With the freeze deal, the oil market would rebalance as early as late 2016, Novak added, but without it the rebalancing would not happen until late next year.

A freeze in output would at least stop adding to the excess supply that has caused prices to collapse from levels above $100 a barrel seen in June 2014.

OPEC delegates have said that further action including a supply cut could follow by the end of the year, depending on Russia's commitment to the freeze and how much oil Iran adds to the market.

Hard to backtrack

A second delegate from OPEC said a pact that failed to include Iran was not the worst possible outcome.

However, "if the others freeze and the Iranians are outside the agreement, it will not help the market unless the demand is very large", this delegate added. "January output is already at high levels."

Backtracking on the deal would risk jeopardising the recent rally in oil prices, other OPEC sources said.

"You can't ignore all other oil producers. The meeting is likely to go ahead," a third source said, adding that the April meeting was likely to discuss and finalise details of the deal. "We will not just meet for the sake of meeting."

It was unclear whether all 13 OPEC members and which outside producers would attend. Kuwait and the United Arab Emirates have said they would commit to the freeze if other major producers also participated.

Novak said Qatar was sending invitations to all OPEC members as well as to some producers outside the organisation.

"After it receives confirmations it will be possible to talk about the exact number of participants," Novak said. "Iran said it was ready to take part in this meeting." 

The willingness of Iraq, the biggest source of OPEC supply growth in 2015, to join the deal is also important. Baghdad on Monday said the freeze initiative was acceptable. 

AMMAN — The General Union of Arab Chambers of Commerce, Industry and Agriculture, during its council's 120th session held on Wednesday in Muscat, decided to appoint Jordan Chamber of Commerce (JCC) President Nael Kabariti as head of the council for two years, according to a JCC statement.

AMMAN — The  Amman Chamber of Industry (ACI) and the European Bank for Reconstruction and Development (EBRD) agreed on Wednesday to cooperate in helping small- and medium-sized enterprises develop through providing support in the administrative, technical and financial fields.

ACI President Ziad Homsi and Heike Harmgart, EBRD head of office in Amman, signed a memorandum of understanding to this effect on the sidelines of a workshop the chamber organised to highlight programmes and services EBRD presents to the industrial sector.

Homsi called on industrialists to benefit from the bank's services such as consultation, loans and grants, noting that the sector faces financing challenges.

He indicated that banks' financing  to the sector do not exceed 11 per cent of total loans, with only 3.3 per cent of the credit facilities benefiting the small and medium-sized industries  .

Harmgart said EBRD will present comprehensive pack of programmes aimed at helping small and medium projects to succeed, pointing out that funding to schemes in Jordan has reached 500 million euros.

EBRD presents non-refundable grants to cover a basic percentage of a  consultation project, with up to 10,000 euros ceiling to local consultations and 50,000 euros to international ones, Harmgart said.

Also on Wednesday, Jordanian Businessmen Association's (JBA) board of directors met with the World Bank's delegates currently visiting the Kingdom, and discussed ways to enhance business environment in Jordan to attract more investments to development zones.

The meeting also discussed the outcomes of the London donor conference, as the bank will provide Jordan with a soft loan to enhance the business environment and develop several areas witnessing the implementation of development and investment projects with additional incentives to help employ Syrian refugees and Jordanian young people.

JBA President Hamdi Tabbaa said the association presented a study on the tax situation in the Kingdom to the government, recommending the gradual change of the entire country into a development zone according to economic circumstances.

He also spoke about the high electricity charges and their negative impact on the competitiveness of the national economy, and the industrial sector in particular.

AMMAN — Industry, Trade and Supply Minister Maha Ali on Wednesday commended the Cabinet's decision granting merger insurance companies exemptions and incentives.

These incentives include a three-year exemption from income tax, a three-year exemption from annual fees imposed under the law regulating the work of insurance companies, in addition to exemptions from ownership transfer and capital raise fees for the new merged company, Ali said in a ministry statement.

She expressed hope that these government procedures would contribute to encouraging insurance companies to merge to develop the insurance companies through having strong companies with big capitals. Merging could also contribute to boosting Jordanian insurance companies to penetrate regional markets, Ali noted.

BEIJING — China's economy will not suffer a "hard landing", Premier Li Keqiang said on Wednesday, stepping up Beijing's charm offensive to reassure investors that the government can manage slowing growth.

"We have long-term confidence in the Chinese economy and this confidence isn't without a foundation," Li told his once-a-year press conference at the end of the National People's Congress (NPC), the communist-controlled legislature.

Beijing has been looking to send positive messages in recent weeks after expansion in the world's second-largest economy fell to a 25-year low of 6.9 per cent in 2015, raising concerns on global markets and sending commodity prices plunging.

Li has reduced the target for this year to a range of 6.5-7 per cent, while ratings agency Moody's has lowered its outlook on Chinese bonds.

Authorities have spent hundreds of billions of dollars to defend share prices and the yuan currency in recent months, raising questions over their commitment to market reforms.

Li acknowledged that the government had "controlled some things that should not be controlled, hindering productivity", and said leaders had failed to ensure a fair playing field in the economy.

But he added: "As long as we persist with reform and opening up, China's economy won't have a hard landing."

Questions have to be submitted in advance for the set-piece event. Li spoke for two hours in a cold room under glittering chandeliers in the Great Hall of the People.

"China's economy has both hopes and difficulties," Li said, adding: "If we look at it in light of the fundamentals and the overall trend, the hopes are greater than the difficulties."  

Coal and steel       

Li spoke after the rubber-stamp parliament approved an economic roadmap for the next five years and a charity law.

Votes at the NPC are normally overwhelming approvals of measures decided long in advance by the ruling Communist Party.

As the balloting started, a voice boomed over a loudspeaker asking delegates to press the voting buttons. Thousands of arms in suit jackets reached across the desks simultaneously.

There were 2,778 “Yes” votes for the 13th Five Year Plan, or 97.27 per cent of the total, the official Xinhua news agency reported, and 2,636 in favour of the charity law — 92.49 per cent.

The five-year plan for economic and social development pledged average growth of at least 6.5 per cent a year over the 2016-2020 period, implying that at times it could be lower.

Such plans are a legacy of China's command economy era but still guide policymakers at all levels.

Cracks in the economy are already showing as growth slows. Thousands of miners went on strike in northeastern China to protest at unpaid wages, amid fears of mass layoffs as the government seeks to restructure lumbering state-owned industries.

Premier Li worked to dispel fears on the issue. 

"We have chosen the two sectors of coal and steel to make breakthroughs, and at the same time avoid a massive wave of lay-offs," he said.

The finance minister last week said China's labour regulations harm workers by reducing job opportunities.

The labour contract law passed in 2007 restricts companies' ability to fire workers. Minister Lou Jiwei said it was discriminatory towards people entering the workforce, and so ultimately counterproductive.

His comments on the sidelines of the National People's Congress (NPC) echo debates around the world on the conflict between job creation and protection of existing employees.

Communist China was once a command economy where many workers could rely on their work unit, or "danwei", for everything from housing to medical care. 

Three decades ago it embraced market principles, dubbed "socialism with Chinese characteristics", triggering a huge economic boom. But some sectors remain bloated and inefficient, particularly state-owned enterprises.

Lou said the labour law's "original purpose was to protect workers, but in the end it harms the interests of some workers, and may lead to a rapid rise in wages", increasing firms' costs and leading them to move operations overseas.

"Ultimately who is harmed? It's workers who are harmed," he added. "The job opportunities are reduced."

He did not propose specific reforms but said the finance ministry "must point out problems it sees, because it has an effect on the entire economy".

Reducing overcapacity in industrial sectors such as steel and coal has become an urgent priority for the world's second-largest economy as it seeks to transition away from investment-led economic growth towards a consumer-driven model.

But such cuts have raised worries of vast lay-offs akin to the wave of 30 million job losses experienced in the 1990s when Beijing shuttered thousands of state-run companies, and the ruling party is always keen to prevent social unrest. 

At the opening of the NPC, Premier Li pledged to kill "zombie enterprises" and cut excess capacity through mergers or liquidations.

Earlier this month, the country's top economic planner reiterated a goal of reducing steel capacity, an industry suffering a global glut, by 100-150 million tonnes within five years, but added that such cuts would "definitely not" cause mass unemployment. 

In February, the minister of human resources and social security estimated there would be 1.8 million lay-offs due to restructuring in the coal and steel industries, without giving a timescale.

To cushion such blows, Li said the central government would allocate 100 billion yuan ($15 billion) over the next two years for a labour resettlement fund.

Tough reforms decreed by central authorities have often suffered from a lack of implementation in China.

Lou said that pushing through change would require determination from top authorities and a willingness to "gnaw the hard bone", an expression roughly meaning to "bite the bullet".  

According to the plan, the gross domestic product (GDP) is set to rise from 67.7 trillion yuan ($10.4 trillion) last year to more than 92.7 trillion yuan in 2020.

'Good Samaritans' 

It also seeks to significantly reduce poverty by 2020. Officials have declared charitable organisations essential to achieving the goal and hope to encourage more giving with the charity law. 

As the economy has grown to the world's second-largest, charitable giving has lagged, with China ranking 144th out of 145 countries for giving, according to a study last year by the Charities Aid Foundation.

Chinese citizens donated just $16 billion in 2014, according to the most recent data from the China Charity Information Centre, less than 0.2 per cent of annual GDP.

Xinhua said the new law was intended to "recruit help from good Samaritans in realising the 2020 poverty alleviation target".

Separately, China's labour protections are coming under fire from high places as economic restructuring pits officials concerned about social stability against a lobby arguing inflexible policies are stifling job creation and suppressing wages.

Company executives, especially at foreign or private firms, have long been critical of labour contract legislation and minimum wage laws that make it difficult for owners of an ailing business to turn it around or find willing buyers.

Now policymakers anxious to modernise China's slowing economy and slash overcapacity in heavy industry are making similar noises.

The export powerhouse province of Guangdong, a trillion-dollar economy that often leads the way on market reforms, said this month it would scrap scheduled rises to the local minimum wage in 2016, and keep it at 2015 levels, slightly over 1,500 yuan ($230) per month, through 2018.

The law fixed a 40-hour working week for most employees, regulated maternity leave, and required businesses to be able to prove their case for sacking employees for incompetence or criminality or face heavy penalties.

Its standards aspire to those of developed economies, rather than emerging markets, though enforcement is weak. 

The European Union, for example, limits the working week to 48 hours, while China's maximum is about the same, after allowing up to 36 hours a month overtime.

Regulations say minimum wages should be between 40 and 60 per cent of the local average, though in practice 30-40 per cent is typical, compared with about 30 per cent in the United States and 50 per cent in Britain.

Protections against dismissal are comparable to Japan's.

"The Chinese government wanted the best, the most polished labour legislation they could find, and simply imposed it on an economy that couldn't cope with it," said Geoffrey Crothall, communications director at China Labour Bulletin.

Chinese wages have risen at double-digit rates since the 2008 act, so factory workers now earn significantly higher than competitors in Bangladesh, Vietnam and Cambodia, and some think labour protections are hampering an economic transformation that will benefit workers in the long run.

"For enterprises and employees, the extent of protection afforded by the Labour Contract Law is unbalanced," Lou said, adding it encouraged companies to moves jobs from China to other countries.

Labour activists say the protections are still needed, and businesses often break labour law with impunity, especially if they have local government connections.

Danny Lau, who owns a factory in Dongguan city in Guangdong, said he expected the government would soon "consolidate and streamline" the contract law to lower costs for manufacturers.

That would be welcome news to businesses exasperated by official interference in their operations.

"We have these government bureaucrats who show up at our facility arbitrarily, and they say, 'let's look at your payroll'," said Ravin Gandhi, chief  executive officer of GMM Nonstick Coatings, which runs an office in Dongguan.

"And they say, 'Thirty per cent of your facility workforce is going to get a pay raise. These people here are going to get 15 per cent.' They don't look at your profitability, nothing."

As a result, GMM opened its next facility in India, which Gandhi said was 40 per cent cheaper than China, even allowing for inferior infrastructure.

"Of course, I'm going to take my foot off the gas pedal [in China]," he added. "I'll put those dollars in India."

When Reuters visited a printing factory in Chongqing in January, the boss was interrupted mid-interview by local officials, who had come to make sure he had paid salaries before the Lunar New Year holidays.

"[Last year] they called us into a meeting and said, 'You can't lay off employees'," he added.

Many economists say China has posted lacklustre business activity and investment figures, while official unemployment stays below 5 per cent, precisely because companies saddled with high wage bills and low profit margins can't cut debt or invest.

"It's better to support workers than supporting loss-making firms," Li Yining, an economist at Peking University, said on the sidelines of the annual parliament meeting.

Local officials have reason to be cautious about diluting protections, however, as a rise in worker protests in their patch can be both physically dangerous and career limiting.

Cui Ernan, labour analyst at Gavekal Dragonomics, said the government might even increase labour benefits to calm agitated workforces, particularly in regions with heavy lay-offs from coal and steel.

"Recent labour strikes at the end of 2015 and the beginning of 2016 are at historical highs," she noted.