Business

BAGHDAD — Iraqi authorities called on international private sector companies to bid for the expansion and operation of Baghdad's international airport after years of neglect in the conflict-scarred country.

In September, the government signed an agreement with the World Bank's International Finance Corporation (IFC) to invite private companies to upgrade Iraq's main airport.

Iraq "is launching a two-stage public tender to select a private partner to rehabilitate, expand, finance, operate, and maintain Baghdad International Airport under a long-term Public-Private Partnership [PPP] contract", according to the official document calling for bidders and seen by AFP on Tuesday.

It is the "first time that the Iraqi government, in cooperation with the IFC, opens its airports to private international investment", Farhad Alaaldin, the prime minister's foreign affairs adviser, told AFP.

It is "a step that will elevate the aviation sector to international standards", he added.

The deadline to submit bids is September 12, and the winner "is expected to modernise and rehabilitate the airport infrastructure, expand passenger and cargo terminal facilities... and operate and maintain the airport in line with international best practise," the document added.

The IFC, according to the document, "is acting as the lead transaction adviser for this PPP project".

Alaaldin said the tender process relies "on the IFC to have oversight over the project from its inception and to work on the economic model".

The IFC's involvement, it is hoped, will "give more confidence to the world class companies to bid", Alaaldin said.

"Iraq is open for business and inward investment is on the rise," he added.

Last month, Prime Minister Mohamed Shia al-Sudani's media office said an IFC study showed "a compound annual growth rate of 15.7 per cent in air traffic" in recent years, with over 3.4 million passengers arriving in Baghdad in 2023.

It said the IFC proposed building a new terminal to increase airport capacity to up to nine million passengers per year.

Baghdad's airport has undergone no substantial renovations since it opened in the early 1980s under Dictator Saddam Hussein's rule.

It was closed in the 1990s due to international sanctions, forcing people to travel by land to neighbouring Jordan to catch their flights.

Baghdad airport is quickly overwhelmed when travel peaks, and its three terminals are equipped with only basic amenities.

Troops belonging to an international anti-extremist coalition are stationed in a part of the airport, and have previously come under fire.

Oil-rich Iraq suffers from deteriorating infrastructure and failing public services as a result of decades of conflict, poor public management and endemic corruption. 

BEIJING — China posted lower than expected growth in the second quarter on Monday, with all eyes on how top officials gathering for a key meeting in Beijing might seek to tackle the country's deepening economic malaise.

The world's second-largest economy is grappling with a real estate debt crisis, weakening consumption, and an ageing population.

Trade tensions with the United States and the European Union, which have sought to limit Beijing's access to sensitive technology as well as putting up tariffs to protect their markets from cheap, subsidised Chinese goods, are also dragging growth down.

And on Monday, official statistics showed the economy grew by only 4.7 per cent in the second quarter of the year.

It represents the slowest rate of expansion since early 2023, when China was emerging from a crippling zero-COVID policy that strangled growth.

Analysts polled by Bloomberg had expected 5.1 per cent.

Retail sales — a key gauge of consumption — rose just two per cent in June, down from 3.7 per cent growth in May.

"The external environment is intertwined and complex," the National Bureau of Statistics said.

"Domestic effective demand remains insufficient and the foundation for sound economic recovery and growth still needs to be strengthened," it added.

'A modest policy tweak' 

From Monday, President Xi Jinping is set to oversee the ruling Communist Party's secretive meeting known as the Third Plenum, which usually takes place every five years in October.

Beijing has offered few hints about what might be on the table.

State media in June said the delayed four-day gathering would "primarily examine issues related to further comprehensively deepening reform and advancing Chinese modernisation", and Xi has said the party is planning "major" reforms.

Analysts are hoping those pledges will result in badly needed support for the economy.

"The four-day meeting of the country's top governing body couldn't come soon enough," Harry Murphy Cruise, an economist at Moody's Analytics, said in a note.

But, he said, "while the case for reform is high, it's unlikely to be a particularly exciting affair".

"Instead, we expect a modest policy tweak that expands high-tech manufacturing and delivers a sprinkling of support to housing and households," he added.

Reform not expected 

The People's Daily, the Communist Party's official newspaper, appeared to confirm lower expectations when it warned last week that "reform is not about changing direction and transformation is not about changing colour".

Ting Lu, chief China economist at Nomura, said the meeting was "intended to generate and discuss big, long-term ideas and structural reforms instead of making short-term policy adjustments".

The Third Plenum has previously been an occasion for the party's top leadership to unveil major economic policy shifts. 

In 1978, then-leader Deng Xiaoping used the meeting to announce market reforms that would put China on the path to dazzling economic growth by opening it to the world.

And more recently following the closed-door meeting in 2013, the leadership pledged to give the free market a "decisive" role in resource allocation, as well as other sweeping changes to economic and social policy.

Stubbornly low 

Beijing has said it is aiming for five per cent growth this year — enviable for many Western countries but a far cry from the double-digit expansion that for years drove the Chinese economy.

But the economic uncertainty is also fuelling a vicious cycle that has kept consumption stubbornly low.

Among the most urgent issues facing the economy is the beleaguered property sector, which long served as a key engine for growth but is now mired in debt, with several top firms facing liquidation.

Authorities have moved in recent months to ease pressure on developers and restore confidence, including by encouraging local governments to buy up unsold homes.

Analysts say much more is required for a full rebound, as the country's economy has yet to bounce back more than 18 months after damaging Covid-19 restrictions ended.

FRANKFURT, Germany — German airline giant Lufthansa slashed its 2024 profit forecast recently after a weak second quarter and launched a "turnaround" plan for its flagship carrier, which it warned might not break even.

It was further evidence of renewed turbulence at one of Europe's biggest aviation groups, which has been on the back foot in recent months as a post-pandemic bounce peters out.

The group said in a statement it now expects operating profit of 1.4-1.8 billion euros ($1.5-$1.9 billion) for the year, down from a previous estimate of around 2.2 billion euros.

Second-quarter operating profit was 686 million euros, tumbling almost 40 per cent from a year earlier, according to preliminary figures for the group, whose airlines include Lufthansa, Eurowings, Austrian, Swiss and Brussels Airlines.

Nevertheless, the result was slightly higher than the 646 million profit predicted by analysts surveyed by financial data firm FactSet. 

Flagship carrier Lufthansa saw its profits fall particularly sharply due to poor market conditions, inefficient flight operations and delayed aircraft delivery, the statement said.

"It is becoming increasingly challenging for Lufthansa Airlines to break even for the full year," the group said. 

"To counteract this, a comprehensive turnaround programme is being launched," it said, without giving further details. 

Lufthansa's shares were down more than 2 per cent in Frankfurt after the results were published. 

Stormy skies 

Earnings for the group's other passenger airlines as well as its cargo and maintenance businesses were expected to be broadly at the previous year's level, and in some cases higher, it said. 

More information on the financial outlook will be released alongside its final results for the second quarter on July 31.

Lufthansa had to be bailed out by the German government during the coronavirus pandemic but rebounded strongly when demand roared back, racking up healthy profits last year and in 2022. 

But the airline giant is now facing multiple challenges.

The group reported a hefty first-quarter loss after facing a wave of walkouts as staff pushed for higher pay to compensate for elevated inflation.

The strikes have ended now after Lufthansa agreed on deals with key unions, although the group previously warned the impact would also overshadow the second quarter. 

The Hamas-Israel war and broader tensions in the Middle East have had an impact, forcing Lufthansa on occasion to suspend flights to and from several destinations in the region.

Last month the group said it would introduce an environmental charge for fares in Europe to cover additional costs from increasing EU climate regulations, particularly rules related to sustainable aviation fuel.

It will be hoping for a boost from the acquisition of a stake in ITA Airways, created from the ashes of Alitalia. The EU this month gave conditional approval for the deal following a probe over concerns it could hurt competition.

Lufthansa's major European rival, Airbus-KLM, has also struggled this year, losing 522 million euros in the first quarter on rising costs and geopolitical tensions despite a higher number of passengers and higher ticket prices. 

AMMAN — The Kingdom’s instant payment service CliQ, recorded 32.9 million transactions, worth JD4.95 billion during the first half of 2024, according to the Jordan Payments and Clearing Company (JoPACC) on Saturday.

The CliQ transactions executed throughout June this year are valued at JD963 million, compared to transactions, worth JD923 million in May, increasing by 4.4 per cent.

The JoPACC revealed that the total number of CliQ users had reached 1.43 million users by end of June, rising by nearly 2.6 per cent when compared with the number of users in May.

The company's data showed that 96.6 per cent of users are Jordanians, and 3.4 per cent are non-Jordanians. Gender wise, 62.8 per cent are males, and 34.7 per cent are female users.

According to age groups, 5,000 users are below the age of 18, 555,000 users are between 18 and 30 years of age, and 377,000 users are aged between 31 and 40, in addition to 242,000 who are between 41 and 50 years old.

Also, around 146,000 of users are aged from 51 to 60 years, among other age groups. 

Sarah Younes, a Jordanian banker, told The Jordan Times over the phone that "people in the Kingdom use this system to make transfers or payments from their bank to other accounts…it is increasingly utilised as it is free of charge".

Adding that the service is equipped with high security and this has increased people’s confidence in the service which enables the customer to monitor the payment.

The majority of banks in Jordan are participants on CliQ, according to JoPACC which showed that the service is overseen by the Central Bank of Jordan and operated by JoPACC.

PARIS — The International Energy Agency trimmed its forecasts on Thursday as it said world oil demand growth continues to slow and consumption in China dipped. 

The Paris-based body that advises industrial nations on energy policy said oil demand increased by just 710,000 barrels per day in the second quarter, the slowest rate in over a year. 

"Oil consumption in China, long the engine of global oil demand growth, contracted in both April and May" the IEA said in its monthly report on the oil market. 

Chinese demand in the second quarter was also marginally below the same period in 2023. 

While demand in that quarter benefitted from the reopening of the Chinese economy after Covid lockdowns, the IEA said that the recent drop also "points to an intrinsic slowdown" and that "the downswing in the industrial fuels indicates a broader weakness in manufacturing". 

The world's second-largest economy is grappling with a real estate debt crisis, weakening consumption, an ageing population and geopolitical tensions overseas. 

The IEA trimmed its forecast for Chinese oil demand this year by 0.2 million barrels per day (mbd) to 17 mbd. While that would be a gain of 0.5 mbd from 2023, it is far short of the 1.5 mbd gain last year. 

The IEA sees Chinese demand growth slowing to 0.3 mbd in 2025, also a drop of 0.2 mbd from its previous forecast. 

The return to pre-COVID normalcy and weak growth will also see China's weight in global oil demand growth decline, from about 70 per cent of gains last year to 40 per cent this year and next, according to the IEA. 

Emerging economies such as India and Brazil will account for a greater share in global oil demand growth, while advanced economies in the OECD will see consumption decline. 

"Global gains are forecast to average just below 1 mbd in 2024 and 2025, as subpar economic growth, greater efficiencies and vehicle electrification act as headwinds," the agency said. 

It trimmed its 2024 global oil demand forecast by 0.1 mbd to 103.1 mbd and its 2025 forecast by 0.2 mbd to 104.0 mbd. 

Earlier this month the IEA said it expected global oil demand to stabilise at around 106 mbd by the end of the decade as demand in advanced economies falls. 

DUBAI — Energy majors TotalEnergies, Shell and BP will each take a 10 per cent stake in a liquefied natural gas project in the United Arab Emirates, state energy giant ADNOC said on Wednesday.

Japanese trading company Mitsui & Co. will also acquire 10 per cent of the Ruwais LNG plant, scheduled to come online in 2028, the Abu Dhabi National Oil Company (ADNOC) said.

ADNOC, the UAE's key revenue-earner, will retain a 60 per cent majority stake, the firm said following a signing ceremony.

The Ruwais plant, currently under development in Abu Dhabi, is expected to produce about 9.6 million metric tonnes per annum (mtpa), ADNOC said, more than doubling the company's LNG production capacity in the UAE.

Ruwais, which will run on nuclear power, will be "one of the world's lowest carbon-intensive LNG facilities", said ADNOC Chief Executive Sultan Al Jaber.

ADNOC also said it has signed "several" long-term LNG sales agreements with international partners, including for one mtpa with Shell and 0.6mtpa with Mitsui & Co., taking Ruwais's committed production capacity to 70 per cent.

Gas is being touted as cleaner than other fossil fuels as countries around the world strive to reduce their emissions and slow global warming.

Demand for gas spiked following Russia's invasion of Ukraine, with several Gulf countries looking to boost output.

Qatar this year announced new plans to expand output from the world's biggest natural gas field, saying it will boost capacity to 142 million tonnes per year before 2030.

LONDON — Britain's embattled Thames Water on Tuesday said its debt continues to rise despite increased revenues, leaving the group with cash reserves taking it through only until May next year.

 Britain's biggest water supplier avoided a state rescue under the previous Conservative government, leaving the newly-elected Labour administration to decide whether taxpayers should renationalise the company. 

Thames said that debt increased around nine per cent to nearly £15.25 billion ($19.5 billion) in the year to the end of March.

Britain's water regulator is on Thursday due to respond to a five-year business plan laid out by UK water companies including Thames, which on Tuesday said it had sufficient liquid funds of £1.8 billion — enough to see it through until May 2025.

 "The challenges we face are well documented," Chief Executive Chris Weston said in the results statement.

 "But our operational and financial performance for the last year show good progress, and these positive results provide the right foundations on which to build and improve." 

 Thames on Tuesday said its last financial year saw record investment — up 18 per cent at £2.1 billion — to improve "ageing" infrastructure.

 It was helped by a 10-per cent rise in revenue to £2.4 billion as customers paid more for their water.

 The company, which supplies around 16 million homes and businesses in London and elsewhere in southern England, has missed targets to reduce leaks and slash sewage discharges into rivers, despite the major investment.

 Environmentalists have increasingly voiced outrage at the rise in pollution on the UK's beaches and waterways, and have pointed the finger at privatised water companies.

 The new Labour government waded into the debate Tuesday after bringing an end to 14 years of Conservative rule in last week's general election.

 Communities minister Jim McMahon said there was "no programme of nationalisation for the water industry" should Thames Water collapse.

 But he added: "The days of putting shareholder interest above the national interest, frankly, can't carry on and so we do need to look at that and Thames do need to look at their own house and get it in order."