Business

BERLIN — Saudi Arabia's oil minister said on Wednesday he expected oil prices, which hit a near six-year low in January, to stabilise, signalling cautious optimistism about the market outlook.

Giving a speech in the German capital, Ali Al Naimi also urged producers outside the Organisation of Petroleum Exporting Countries (OPEC) to help balance the oil market, saying it was not up to Saudi Arabia to subsidise higher-cost producers and that circumstances required non-OPEC to cooperate.

"Going forward, I hope and expect supply and demand to balance and for prices to stabilise," Naimi said. "Global economic growth seems more robust."

The comments are a further sign OPEC's top producer is sticking to its policy to defend market share. 

Last month, Naimi signalled satisfaction with developments, saying he saw oil demand growing and that markets were "calm".

Oil was trading just above $60 a barrel on Wednesday, up more than 30 per cent from a near six-year low close to $45 on January 13.

Prices collapsed from $115 in June due to oversupply, in a decline that deepened after Saudi Arabia and the rest of  OPEC nations at a November meeting refused to cut output.

At the meeting, Saudi Arabia and its Gulf allies argued that the group needed to ride out lower prices in order to defend market share against higher-cost shale oil and other competing supply sources, rather than cut output.

Officials from Russia and some other non-OPEC nations held talks with OPEC ministers on the sidelines of the meeting. But no agreement on cutting supply was reached, OPEC left its output steady and prices fell further.

Oil's drop has hurt smaller OPEC members and hit Russia's economy hard. 

Some in OPEC continue to lobby for output cuts and an emergency OPEC meeting, and last month Igor Sechin, the head of Kremlin-controlled energy giant Rosneft, criticised OPEC for destabilising the oil market.

But Naimi on Wednesday said Saudi would not act alone and he was not aware of any plans for a special OPEC meeting. The next OPEC meeting is not until June.

"In cooperation with many countries, we have moderated production levels to improve the market situation. But now the situation is different. We need every major producer to cooperate," he said.

"It makes absolutely no sense for the most efficient producers to be the ones to cut production when we are only 30 per cent of the producers," the minister added.

He defended OPEC's November decision and said Saudi Arabia would not cut its output unless buyers asked for less.

"In November, OPEC made a historic decision, it did not interfere in the market. I think history will prove that this was the correct path forward," he added.

AMMAN — The European Bank for Reconstruction and Development (EBRD) announced Tuesday in a press statement that it is providing a $30 million loan to MS Pharma Ventures W.L.L. to finance the production of new generic pharmaceutical products.

"Locally manufactured medicines are scarce in Jordan and in the wider region of the Middle East and North Africa. The bank’s investment will contribute to the commercialisation of these products and improve access to the latest generation of pharmaceutical products in the region," the statement said.

It added: "The EBRD loan will help the company to upgrade and expand its manufacturing facilities, increase its capacity and produce specialised products for chronic illnesses such as cancer, or cardiovascular, central nervous system and respiratory diseases."

Heike Harmgart, EBRD head of office in Jordan, said: "Supporting MS Pharma, in line with the bank’s strategy to promote innovation, will contribute to the development of Jordan as a pharmaceutical manufacturing hub in the region and will help boost the production of vital medicines.”

AMMAN – Jordanian billionaire Ziad Manasir slipped in annual ranking of global billionaires released by Forbes magazine this week. 

Manasir ranking dropped sharply from 609 in the 2014 billionaires list to 1,638 this year, according to Forbes, which estimated his fortune at $1.1 billion down from $2.8 billion last year. 

The 49-year old businessman is the owner of Amman-based Manasir Group and the construction firm of  Stroygazconsulting, which has close ties with Russia's state-owned gas producer, Gazprom. 

Forbes attributed the sharp decline in the value of Manasir's fortune to sanctions imposed against Gazprom over Russia's role in eastern Ukraine. 

The sanctions have cut into Manasir's business. 

Forbes said that Stroygazconsulting is implementing a number of projects in Russia that include metro construction in Moscow, the Kolyma highway in Russia's Far East and various sports facilities. 

Other major clients of Stroygazconsulting, besides the gas monopoly, include Rosavtodor, a federal agency behind road construction in Russia.

Manasir was born in Jordan, went to Russia as an exchange student and attended the Azerbaijan Oil and Chemistry Institute, Forbes said, adding that as a student, he began buying and selling computers and cars, and he later moved on to trade in yellow phosphorus, timber and oil products.

In the mid-1990s he bought a construction factory in Tyumen and started building residences for Gazprom workers there.

Manasir owns several large investments in Jordan in the fields of oil and construction.

As he is based in Russia and holds its nationality, Forbes listed Manasir among the richest Russian businesspeople as he came in 73rd place. 

Forbes said that a record of 290 newcomers joined the billionaires list this year. 

Forbes said that Bill Gates' net worth rose to $79.2 billion in 2015 from $76 billion last year to put him at the top of the magazine's list of the world's billionaires for the second consecutive year.

In second place is Mexican telecommunications mogul Carlos Slim Helu, with a net worth of $77.1 billion. 

Next is investor Warren Buffett, who moved up one slot this year with a net worth of $72.7 billion. 

AMMAN – Current prices of shares are attractive and represent a good opportunity for investors to enter the stock market, the chief of Amman bourse told The Jordan Times this week. 

Nader Azar, chief executive officer of Amman Stock Exchange (ASE), said in an interview that some company shares traded in the market are below their par value.

He also mentioned that dividends proposed to shareholders in a number of corporations are another factor that should attract investors.

Azar said the ASE started 2015 with a positive performance as the free float price index closed by the end of February at 2195.5 points, 1.4 per cent higher than 2014 closing. 

He indicated that companies listed on the bourse recorded JD1.2 billion net income before tax for the first three quarters of 2014. The amount is a 7.9 per cent increase compared to the same period of the year 2013. 

"I believe this performance will have a positive effect on the stock prices," he said.

Trading in 2014 

The trading value last year amounted to JD2.3 billion compared to JD3.1 billion in 2013, a 25.2 per cent fall, while the number of shares traded reached 2.3 billion compared to 2.7 billion shares traded in 2013, a 14.2 per cent drop. 

The number of executed transactions declined by 11 per cent to 956,000 from 1.074 million transactions in 2013. 

According to the ASE chief, tensions and instability in neighbouring countries continue to weigh on the Jordanian economy, which already faces many challenges such as vulnerability to fluctuations in the oil market prices, increasing pressure on natural resources, especially water; and escalating spillovers from the conflicts. 

Due to these challenges, the public debt reached a high level and the budget deficit exceeded its anticipated ratio in the past years.  

"These factors affected the ASE performance, especially in 2011," Azar said, describing the effect as unsustainable. 

He added that the ASE is working on facilitating trading and attracting new investors to the market in order to increase the trading value and volume, to give the market more depth and to restore investors’ confidence. 

Market capitalisation and non-Jordanian investors 

Noting that the ASE market capitalisation at the end of 2014 was JD18.1 billion, Azar indicated that non-Jordanian ownership in companies listed on the bourse by the end of last year represented 48.8 per cent of the total market capitalisation, 36 per cent for Arab investors and 12.8 per cent for non-Arabs. 

He described this percentage as one of the highest in the region.

At sub-sector levels, non-Jordanian ownership reached 63.7 per cent in mining and extraction industries, 60.5 per cent in technology and communications, and 60.3 per cent in banking.

The market capitalisation of these three sub-sectors represents 72 per cent of the overall market capitalisation of the ASE, he remarked.

"The high level of foreign investors’ ownership in the market capitalisation reflects their confidence in the stock market," Azar said. 

"The foreign investors’ ownership has been fluctuating narrowly during the past several years, between 46 per cent and 52 per cent, which proves that they are long-term investments stemming from high-level confidence in the ASE and the investment environment in Jordan," he added.

Azar indicated that the total value of shares bought by non-Jordanian investors in 2014 was JD362.7 million, representing 16 per cent of the overall trading value, while the value of shares sold by them amounted to JD384.8 million. 

Trading by individuals 

Referring to latest statistics issued by the Securities Depository Centre, Azar said individuals own 31 per cent of the market capitalisation, while the remaining 69 per cent belongs mainly to companies, institutions, funds, and governments. 

As for trading activity, individuals account for 75 per cent of the total ASE trading. 

Recovery  2015 faster or slower? 

Asked whether he expects the bourse to see faster recovery in 2015, Azar mentioned economic growth and regional conditions, noting that some of these factors are beyond control. 

However, he said the ASE has many projects in the pipeline to moderate the market and to restore investors’ confidence. 

The ASE is part of a joint venture with Muscat, Beirut and Tunisia exchanges; which will implement a new version of the trading system (UTP-Hybrid) developed by NYSE Technologies, he explained, indicating that the ASE plans to demutualise and become a for-profit public shareholding company totally owned by the government as a first step. 

This will bring further benefits for both the ASE and the national economy in the future, the bourse chief said, adding that changing the legal status will provide more flexibility and assist the ASE to diversify services and products as well as conclude agreements with regional and international exchanges. 

According to Azar, the changes will boost ASE competence, liquidity and capacity to attract new investments.

Azar revealed that capital market institutions are currently working with the Lower House economic committee to discuss modifications and amendments to the current temporarily Securities Law of 2002. 

These amendments will pave the way to issuing exchange traded funds (ETFs), demutualisation of the ASE, improving the margin regulations, and improving corporate governance.

The ASE currently is developing a strategic plan for the coming years that will focus on modernising the market up to the international standards, increasing the ASE competitiveness, enhancing the investors’ confidence and raising public awareness. 

"I believe that these developments would boost the confidence of local and international investors at the ASE, and will have a positive impact on the ASE’s performance," he concluded.

AMMAN – The European Bank for Reconstruction and Development (EBRD) on Monday said it will be providing a $20 million credit line to Jordan's Bank al Etihad for on-lending to micro, small and medium-sized enterprises (MSMEs).

In a statement e-mailed to The Jordan Times, the EBRD said it will also extend a trade finance line of $10 million to boost international and intraregional trade.

According to the EBRD, access to finance remains a challenge for Jordanian MSMEs, despite the fact that they account for 95 per cent of active firms in the country; MSMEs provide 70 per cent of total private sector employment and generate approximately 40 per cent of the gross domestic product.

The EBRD is addressing these financial constraints by disbursing the equivalent of $20 million in Jordanian dinars to facilitate access to finance for smaller businesses, which have the potential to contribute significantly to economic growth and employment.

AMMAN – Under Royal patronage, Arab and international bankers and financiers will gather in Jordan on March 30-31 to attend SWIFT's annual Middle East Regional Conference.

The two-day conference on the eastern shores of the Dead Sea will bring together policy makers, industry leaders and key speakers to discuss the opportunities presented by the region's growth and expansion and examine the challenges posed by an increasingly complex geopolitical and economic environment, the organising company said in a statement posted on its website.

The event, according to organisers, will be a mix of keynote speeches and interactive panel sessions featuring senior speakers and strategic thinkers from across the industry and the region. 

The event will explore the role of financial infrastructure in underpinning economic vitality and in facilitating regional and global trade. Other sessions will look at the rising threat of cybercrime and what institutions in the region are doing to improve financial inclusion. 

AMMAN – The Central Bank of Jordan (CBJ)  announced Monday the launch of the eFAWATEERcom portal (www.eFAWATEERcom.jo) that will enable clients inquire about, review and settle their bills online.

In a statement e-mailed to The Jordan Times, the portal was established in partnership with Madfoo3atCom for Electronic Payments Company as the main operator, MasterCard Internet Gateway Service (MiGS), and Emerging Markets Payments Group (EMP Group) as the hosting company.

This announcement was made during a press conference held at the CBJ's headquarters Monday. Services offered by eFAWATEERcom portal include water, electricity, telecom, education and healthcare bills, in addition to government fines and taxes.

The portal also allows users to safely recharge their prepaid mobile phone balances online using all kind of payment cards that are accepted by MiGS from all around the globe via a unified system, said the statement. 

Barcelona – Defying scepticism and geek-stigma, mobile phone firms are determined this year to sell you a wristwatch wirelessly connected to your mobile phone.

Numerous models have hit the market over the past year but 2015 will see an explosion, analysts say, with manufacturers making their watches and other wearable connected devices more elegant and useful.

US giant Apple's release of its first "smartwatch" — expected by April — is set to make 2015 a "tipping point for wearables", research group CCS Insight said in a report.

In anticipation of that launch, Apple's Asian rivals scrambled to unveil their own connected wrist gadgets in Barcelona on Sunday on the eve of the World Mobile Congress trade show in Barcelona.

South Korean manufacturer LG released the Urbane LTE, its first fully connected luxury wristwatch which can make and receive calls — either with a wireless headset, or by speaking into your wrist like the comic book detective Dick Tracy.

Unlike most smartwatch models, the chunky Urbane LTE version has its own network SIM card with a mobile connection and so can be used for calls, without needing to be linked to a smartphone.

Chinese telecom giant Huawei also unveiled a deluxe smartwatch: a round stainless steel creation that it says can receive text messages, e-mail and call notifications as well monitoring your heart rate and calories burned.

The industry is watching keenly to see whether smartwatches will be the first mobile phone-linked "wearables" to really take off in the mass market — a tough call, according to analysts.

"In the end-user research that we've done, we asked people what a smartwatch is for and they had no idea," said Ben Wood, head of research at CCS Insight.

Technology and fashion 

With the big phone companies piling in alongside smaller smartwatch specialists such as Pebble, fashion brands are doing their bit to try and design a more desirable product.

Several Swiss watchmakers and fashion brands such as Guess have unveiled designs, while jeweller Swarovski has encrusted smartwatches with its crystals for a deluxe look.

"The vast majority of smartwatches on the market are bulky and look more like a piece of technology than a fashion item," however, said Kevin Curran, a telecom specialist at the University of Ulster.

"That's going to change as companies focus more on design and making devices that are more discreet."

With their new circular watches, LG and Huawei positioned themselves at the luxury end of the market, differentiating themselves from the square-faced design revealed in previews by Apple.

"We set out to create smartwatches that could contend for a spot on your wrist with a luxury mechanical watch," said LG's head for Britain and Ireland, Andrew Coughlin.

The launches in Barcelona risk being overshadowed by Apple's release, however.

The Californian company is reportedly planning to ship 5 million of its Apple Watch in the first batch.

"Everyone is watching to see what happens with that. Apple is the massive elephant in the room. We are estimating they could sell 20 million watches this year," said Wood.

That would dwarf the hundreds of thousands of other types of smartwatches that experts estimate have been sold so far.

MUMBAI – Gold premiums in top consumer India could jump to as much as $5 an ounce over world prices next week, from being almost at par, after Finance Minister Arun Jaitley surprised jewellers by maintaining import duty at a record level in Saturday's budget.

The wedding season that extends to May typically raises gold demand, but many had delayed purchases expecting a cut in the 10 per cent tax. Buying had been muted in the past few weeks in the otherwise buzzing jewellery centres, Zaveri Baazar in Mumbai and Karol Bagh in New Delhi.

"Gold prices were declining on expectations of a duty cut but now prices would rise and premiums would shoot to $3 to $4 an ounce," said Rahul Gupta, director at P.P. Jewellers in New Delhi.

Keyur Shah, head of precious metals at retailer Muthoot Pappachan, reckons jewellers and manufacturers will replenish their inventory from Monday, boosting premiums to $5 an ounce.

"Inventories with jewellers and manufacturers are low as everyone was waiting for the duty cut to place fresh orders," Shah said. "Next week we would see big purchases from them."

Jaitley instead proposed introducing gold deposit accounts to make use of the more than 20,000 tonnes held in households and temples in the country, and launched a state gold bond to temper imports.

Shares of major jewellers such as Gitanjali Gems  and Titan Company fell after Jaitley's speech, though the higher prices looked unlikely to significantly dent demand.

Instead, clarity around the duty will cause reluctant buyers to finally end their indecision, industry players said.

India could buy more than 90 tonnes in March compared with an estimate of more than 50 tonnes for this month, according to Sudheesh Nambiath, an analyst at precious metals consultancy GFMS, owned by Thomson Reuters.

Although the government of Prime Minister Narendra Modi did not cut the import duty imposed in 2013, it has been relaxing some other curbs.

MADRID – Spanish Prime Minister Mariano Rajoy on Sunday called on his Greek counterpart to get "serious" about his country's debt-wracked economy, after Alexis Tsipras accused other eurozone partners of undermining its negotiations with Brussels.

Rajoy was reacting to comments by Tsipras on Saturday, who said that during talks that landed Greece a four-month extension to its bailout, pressure from certain other European countries "had the character of blackmail" — pointing especially to Spain and Portugal.

"Conservative forces [in Europe] tried to set a trap for us, to drive us into financial asphyxia," the 40-year-old Greek premier had said.

Speaking Sunday to a meeting of his conservative party, Rajoy fired back in the first out-in-the-open clash between Tsipras and another European leader.

"We are not responsible for the frustration created by the radical Greek left, which promised the Greek people things it knew it couldn't hold to," Rajoy said.

He noted that Tsipras' hard-left Syriza party had tried to put the blame for Greece's problems on Spain and neighbouring Portugal.

"Looking for an external enemy is a way we've already seen many times in history...  That doesn't solve problems, it aggravates them," Rajoy said.

"The only solution is to get serious," he advised the new Greek leader.

Both Madrid and Lisbon have filed official protests against Tsipras' comments with Brussels.

According to Tsipras, Greece came up against "an axis of powers led by Spain and Portugal" that tried to scupper the negotiations to "avoid internal political risks".

His remarks were seen as a reference to the rise of anti-austerity parties in Spain and Portugal, which have been buoyed by Syriza's arrival to power.

In Spain — which unlike Portugal did not receive a full bailout, but whose banks got emergency support in 2012 — Podemos, a close Syriza ally, is leading polls ahead of general elections expected later this year.