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AMMAN — The general budget in the first six months of 2016 registered a post-assistance deficit of JD291.2 million, compared with JD223.5 million in the same period of 2015, the Finance Ministry said on Monday.

The ministry added that local revenues and external grants until the end of June 2016 totalled some JD3.528 billion, compared with JD3.350 billion in the January-June period of 2015, as reported by the Jordan News Agency, Petra.

Local revenues in the first half of 2016 stood at JD3.288 billion, marking a 6.7 per cent growth, when compared to the same period of 2015 that registered JD3.055 billion.

On the other hand, expenditure in the January-June period of 2016 totalled JD3.819 billion, compared with JD3.573 billion registered in the same period of the previous year.

CAIRO — A few years ago Imad would not have imagined himself queuing in the Cairo sun for a weekly ration of subsidised baby milk. But rising prices mean his civil servant's salary barely lasts the month and the government is tightening its belt further.

"Electricity is up, food is up. The only thing that doesn't rise in Egypt is people's pay yet all they talk about is cutting subsidies," said Imad, smartly-dressed like many in the line.

Squeezed by economic and political turmoil since the 2011 uprising that toppled Hosni Mubarak, Egyptians are preparing for a new era of austerity.

The reforms are part of a programme to cut the budget deficit and rebalance currency markets promised to the International Monetary Fund (IMF) to secure $12 billion of lending over three years.

But political opposition to measures involving subsidy cuts, devaluation and new taxes while tens of millions rely on state-subsidised food, make the programme ambitious.

The cost of failure, say economists, is high. The budget deficit is near 10 per cent of GDP. Inflation is 14 per cent. A shortage of foreign currency has hit imports.

Foreign investors are unable to repatriate profit and some are shutting shop, hit by capital and import controls imposed over the last 18 months.

Businesses are unable to secure enough foreign currency to import components or pay a premium above 40 per cent to obtain dollars on the black market. They talk of survival not growth.

"It's very clear that circumstances have led Egypt to really need IMF support... it will have to make changes to ensure the implementation of the plan it presented to the IMF,” said Angus Blair, chief operating officer of Pharos Holding.

"The system in Egypt, as in overall governance, is slow... and this is a reform programme that calls for quick action and bravery, especially because some of the impact will be inflationary."

Political will

Successive governments have balked at cutting subsidies after president Anwar Sadat removed them on flour, rice and oil in 1977, part of an effort to secure IMF-backed financing.

He reinstated them after poor Egyptians rioted, attacking symbols of the growing divide between them and wealthier classes they saw as the beneficiaries of Sadat's policy to liberalise the economy after more than a decade of socialism.

Though Egypt has returned to the IMF virtually every decade since the 1970s, implementation of reforms has been mixed. Many Egyptians are uneasy with a programme they see as being foreign imposed and are convinced it will hurt all but the richest.

More recently, Egypt negotiated two IMF deals that were never finalised, including a $4.8 billion loan initially agreed in 2012. The reluctance with which policymakers have previously approached reforms means investors are not rushing back yet.

Chris Jarvis, head of the IMF's Egypt mission, said those deals had failed due to a lack of political will at the top to implement reforms. This time, he said, political commitment appeared stronger.

President Abdel Fattah Al Sisi said last week he would not hesitate "for one second" to take the difficult steps necessary to ensure Egypt lives within its means.

Too hungry to protest

Electricity prices were raised by 20-40 per cent this month under a five-year programme that will see power subsidies gradually eliminated. Petrol subsidies are next. Reforms to the bloated civil service have been passed by parliament, though heavily diluted.

But critics say change is late and leaves little breathing room. They say the billions of dollars showered on Egypt by Gulf Arab allies since Sisi overthrew his democratically-elected Muslim Brotherhood predecessor in mid-2013, were wasted.

"This support did more harm than good as it was not conditional on reform delivery, and actually removed the urgency to carry out critically-needed policy changes," VTB Capital said in a note to clients.

"Egypt now has a weaker macro-social starting point and requires deeper and, hence, more painful adjustment."

Imad, who once considered himself middle class, now regrets joining the protests that helped bring Sisi to power.

Even with regular raises, his 2,000 pounds($225) a month salary cannot keep pace with rising prices.

"We are not below the poverty line. We are below the ground.... They want us to be so preoccupied looking for bread that we think of nothing else," he said. "Anyone who protests or speaks out now is accused of being brotherhood."

Egypt has announced plans to expand its social security net to mitigate the impact on the poorest but many fear measures will exacerbate inequalities that helped stoke anger against Mubarak before the 2011 revolt ended his 30-year rule.

Today, protest is muted. Under Sisi, brotherhood members have been jailed, exiled or driven underground. Liberal activists who initially backed Sisi have also been silenced. A law restricting protest has ended the mass movements that helped unseat two presidents in three years.

A group of socialist parties have issued a statement rejecting the IMF deal they say saddles Egypt with more debt and leaves it beholden to foreign entities. But none of the parties have parliament seats and there have been no credible protest calls.

Cannot wait any longer

The government's first test is a law proposing VAT at 14 per cent that is being debated in parliament but faces opposition from lawmakers worried about inflation.

Delays to the VAT changes have already held up the first tranche of a $3 billion World Bank loan. The first $2.5 billion IMF payment is not linked to specific measures but subsequent instalments are.

Another key issue is foreign exchange policy. Egypt has promised a more flexible exchange rate to ease the forex shortage and end the black market for dollars.

The move is certain to involve the second devaluation this year, raising inflation, but the central bank says it must first build foreign reserves from $15.5 billion to $25 billion, a figure it hopes to reach by year-end.

For Sami Khangy, who runs a printing press, the dollar shortage is urgent. His machines have been silent for weeks.

"You are talking about months and years. I am talking about weeks. If I can't get paper soon I'll have to sack my staff," he said. "I could be out of business by the time this money comes."

WARRI, Nigeria — Two Nigerian state-owned oil pipelines were blown up in the delta region on Friday in attacks blamed on the Niger Delta Avengers (NDA) militant group, a local security official said Saturday.

"The attacks targeted two pipelines located in the same zone," an official for the Department of State Security (DSS) told AFP.

"Both belonged to the NPDC [Nigerian Petroleum Development Company] and we believe this attack to be due to militants."

Also on Friday, a newly emerged armed group calling itself the Niger Delta Greenland Justice Mandate (NDGJM) claimed responsibility for an attack the same day in Udu state.

It was the second claim of responsibility by the group, which earlier this month claimed to have blown up a major pipeline and warned of more attacks to come.

The creation of the group was announced scarcely two days earlier by its spokesman, self-proclaimed "general" Aldo Agbalaja, who warned that the NDGJM would strike at oil installations within 48 hours.

Since the start of the year, the avengers have carried out a string of devastating attacks on Nigeria's oil pipelines and facilities. 

The oil rebels have also said the Niger Delta, home to the country's multibillion-dollar oil and gas resources, might declare independence on October 1. 

Nigeria marks October 1 as the anniversary of its political independence from colonial power Britain in 1960.

Oil majors including Shell, Exxon, Chevron, Eni and the state-run oil group NNPC have all been targeted in the attacks this year. 

The attacks have reduced Nigeria's output by a third, hammering government revenue at a time of low global oil prices. 

The oil sector accounts for 90 per cent of the nation's foreign exchange earnings and 70 per cent of government revenue. 

The avengers claim to seek a fairer share of Nigeria's oil wealth for residents of the region as well as self-determination and political autonomy. 

They have rejected a government truce to end the violence.

QADISIYA LABOUR CAMP, Saudi Arabia — Migrant construction workers, abandoned in their thousands by Saudi employers in filthy desert camps during the kingdom's economic slump, say they will not accept a government offer of free flights home unless they receive months of unpaid wages.

The plight of the workers, stranded for months in crowded dormitories at labour camps with little money and limited access to food, water or medical care, has alarmed their home countries and drawn unwelcome attention to the conditions of some of the 10 million foreign workers on whom the Saudi economy depends.

The government says it is trying to resolve the situation by giving the workers — who normally need their employers' permission to leave the country — the right to go home and free transport back. It is also granting them special permission to stay while they look for other jobs.

But workers say they fear that if they leave they will end up with nothing at all.

"We will wait here — one year, two years. We will wait for our money. Then we will go back," said Sardar Naseer, 35, a Pakistani welder at the Qadisiya Labour Camp, which houses around 2,000 workers from construction conglomerate Saudi Oger.

Naseer says he is owed 22,000 riyals ($5,900) after receiving no wages for eight months. Workers at the camp, about 20km from the centre of Riyadh, said they had stopped work about four months ago and none had been paid since January.

Oger, the family firm of billionaire former Lebanese prime minister Saad Hariri, did not respond to requests, seeking comment on the story. The Hariri family did not immediately respond to an e-mail seeking comment.

In July, Oger stopped providing food, electricity, maintenance and medical services at several of its camps including Qadisiyah, prompting the Saudi labour ministry to take over provision of basic services there, men at the camp said.

They sleep six to eight in a tiny room, with stray cats and cockroaches lingering on torn bedsheets. They sit on the floor to eat food rations provided by the labour ministry or their embassies.

There is no regular supply of clean drinking water — a filter on a public water fountain meant to be changed daily has not been serviced in a year — so they are forced to buy bottled water with their own money.

Saudi Oger, which employs some 30,000 workers, has built mega-projects including Riyadh's palatial 500-room Ritz Carlton hotel and all-female Princess Noura Bint Abdulrahman University.

It is one of Saudi Arabia's two most prominent construction companies, along with the Saudi Binladin Group. Both have faced financial difficulties as the world's biggest oil exporter has suffered from the fall in the price of crude.

Construction projects have been halted or slowed and revenue has fallen. As the salary delays have worsened, frustrated workers have in some cases staged rare public protests.

Countries including India, Pakistan and the Philippines have sent senior officials to Riyadh to press authorities to assist their workers. Indian officials said this month that more than 6,200 former Indian employees of Oger were stranded in Saudi camps after being laid off and owed wages.

‘Good image’

Two weeks ago, after Indian authorities raised their concerns, King Salman set aside 100 million riyals of government money to help the stranded workers, mostly from Pakistan, India, the Philippines and Bangladesh.

Saudi Labour Minister Mufrej Al Haqbani told Reuters on Wednesday that several distressed local firms, including Saudi Binladin Group, had now started paying overdue wages. Binladin executives promised him that payments would be completed by September, he said.

Oger is the only company still broadly withholding payments, and the Labour ministry will press foreigners' wage claims through the kingdom's labour dispute system, Haqbani said, without specifying when claims might be resolved.

"Saudi Oger — now we'll take it to the courts. Now we are responsible for that. We've hired lawyers," he said. "As the ministry, we will go through the labour dispute courts to go after Saudi Oger and to collect the claims."

He also said the troubles at Oger were not a sign of problems with Saudi Arabia's overall employment of foreign workers, most of whom were choosing to remain in the country.

"This is a small segment... of the labour market. We have more than 10 million expats working happily here in the country. When a company like Saudi Oger fails to comply with the rules, this will never destroy the good image of our labour market."

Philippines Secretary of Labour Silvestre Bello, who visited Riyadh for talks with Haqbani this week, said that with the assistance of Saudi authorities, about 1,000 Filipino workers could be sent home by mid-September.

At the camp, Mohammed Niaz, 42, said his two daughters back in Pakistan had stopped attending school because he could no longer send money home for fees.

"I'm wasting my time. I want to go to Pakistan," he said.

But he added that he refused to leave Saudi Arabia without the 13,000 riyals which Oger owed him. "My family has no money. My daughters are out of school. How can I go to Pakistan?"

LONDON — Oil prices rose on Thursday with Brent briefly topping $50 thanks to a weaker dollar and a drop in US crude stockpiles, traders said.

Brent North Sea crude reached $50.05 a barrel — breaching $50 for the first time since early last month.

Later around (12:30 GMT), Brent North Sea crude for delivery in October was up two cents at $49.87 a barrel following some profit-taking.

US benchmark West Texas Intermediate for September delivery gained 27 cents to $47.06, compared with Wednesday's close.

"Brent has climbed... to $50 per barrel for the first time since early July, finding support from a weaker US dollar and an unexpectedly marked decline in US crude oil and gasoline stocks," said Commerzbank analyst Carsten Fritsch.

As a dollar-priced commodity, a weaker greenback makes crude cheaper for those holding other currencies. 

The dollar has been impacted by minutes from the Federal Reserve's July meeting that showed caution over raising US interest rates, dealers said.

US Central Bank minutes, published on Wednesday, coincided with official data revealing significant declines in US commercial crude stockpiles — signalling a modest strengthening of demand in the world's top oil consumer.

US crude stockpiles last week fell by 2.5 million barrels and gasoline stocks declined 2.7 million barrels, according to the Department of Energy.

Oil prices have hit five-week highs this week, supported by hopes of an agreement between OPEC and non-cartel crude producers to limit excess supplies.

OPEC members and non-OPEC rival Russia are to meet informally in Algeria next month, as reports suggest that OPEC member Saudi Arabia is ramping up production to fresh record levels after an all-time high of 10.67 million barrels per day in July.

Oil price "upside is capped by Saudi's signals of pumping more oil in August, which could give the kingdom more leverage during talks in Algeria next month", said EY energy analyst Sanjeev Gupta.

"The oil market will continue to seesaw amid scepticism over the coordinated efforts to stabilise output," he told AFP.

AMMAN — Jordan Investor Confidence Index (JICI) dropped in May this year by 0.43 points to reach 95.69 points compared with 96.12 points in the previous month. 

The JICI, published on a monthly basis by the Jordan Strategy Forum (JSF), seeks to measure the confidence of investors operating in the Jordanian market through three aspects: confidence in the Jordanian dinar and the monetary system, confidence in the real economy and confidence in the Amman Stock Exchange (ASE).

Both the monetary and the stock exchange sub-indices witnessed slight declines in May, in spite of an increase in the real economy sub-index, according to a JSF statement.

Confidence in the monetary system sub-index dropped to 92.58 points in May from 93.18 points in April, mainly due to a decrease in the volume of foreign reserves at the Central Bank of Jordan by around JD200 million to JD12.074 billion in May. 

The sub-index of confidence in the ASE dropped by 0.31 points to settle at 99.54 points in May, as opposed to 99.85 points in April. The drop could be attributed to a decline in the ratio of shares bought by foreign investors to the shares sold by foreign investors from 1.25 in April 2016 to 1.18 in May, the statement indicated. 

The sub-index of confidence in the real economy went up by 0.33 points in May, reaching 103.57 points compared to 103.09 points in April 2016. 

The number of companies registered in May rose to 550 from 523 companies in April, but the total capital of the registered companies saw a slight drop. 

The Manufacturing Quantity Production Index rose by approximately 11 points to reach 167.09 points, compared with 156.11 points in the previous month. The jump was the outcome of a 40.6 points increase in the production index for the mining and quarrying sector. This was accompanied by an increase in the construction activity, as the number of construction permits and total tax collected on real estate dropped by 10.9 per cent and 19.8 per cent, respectively.

AMMAN — Six US Congress members on Tuesday visited Jordan’s first wind facility, the Tafileh Wind Farm. Touring the project, the congressional delegation from the House Committee on Energy and Commerce commended Jordan’s development in this field, according to a company statement.

"I was extremely impressed by the state-of-the-art technology that Jordan Wind Project Company employed to design and build the first renewable energy project in Jordan.

This joint partnership, which included critical support from USAID, provides essential Jordan-produced energy that will go a long way to help meet [the Kingdom's] energy needs," Congressman Joe Pitts, who led the delegation, said.

Jordan Wind Project Company Chairman Samer S. Judeh highlighted the importance of the project as a focal point in the Kingdom's southern region.

He also expressed his appreciation of the international support for the first utility scale wind farm in the region.

The construction of the 117 megawatt Tafileh Wind Farm was completed in September 2015, at a cost of $287 million.

The US has contributed to the project, as 36 blades — or 12 sets, each costing around $1.3 million — were shipped into Jordan from the US and incorporated into the wind farm.

CAIRO — Egypt hopes a $12-billion financing deal with the International Monetary Fund (IMF) will usher in an economic turnaround but real progress hinges on a tough reform package avoided for decades to stave off unrest.

The financing over three years — deemed an endorsement to attract more foreign aid — would go together with a currency devaluation and streamlining of Egypt’s bloated subsidy system.

But experts warn that the loan alone would serve as little more than an “aspirin” and a stopgap for a deep-rooted economic malaise.

In a country where many rely on state subsidised bread and imports for basic foodstuffs such as wheat, inflation has already risen at a time of low foreign currency reserves and a thriving black market exchange.

More than five years after its 2011 uprising — partly fuelled by economic disparities — that swept away veteran strongman Hosni Mubarak, the country is still reeling from the fallout.

The dire state of the economy, according to President Abdel Fattah Al Sisi, makes the long deferred economic reforms inevitable.

“All the hard decisions that many over the years were scared to take, I will not hesitate for a second to take them,” he said in speech on Saturday, days after Egypt signed the preliminary deal with the IMF.

The government has proposed a reform package to narrow the budget deficit — about 13 per cent of GDP — that includes cuts to power subsidies and a value added tax to raise revenue.

Subsidies account for 7.9 per cent of total government expenditure, according to the finance ministry.

Reforms are also planned to adopt a “flexible policy” for the Egyptian pound.

With dwindling foreign reserves, the government has been propping up the currency at 8.88 pounds to the dollar, well below the black market price, while imposing capital controls.

‘An aspirin’? 

Finance Minister Amr Al Garhy has said the country faces a funding gap of $21 billion over the next three years, and the money would be raised from regional loans and international bonds.

Experts say the IMF loan is essential to bolster foreign currency reserves, which have dwindled to $15.5 billion.

But this will not suffice on its own and may further aggravate the plight of the lower and middle classes.

The financing “is a short-term solution, but in the long term the economy is in bad shape and the deficit is dangerous”, said Ahmed Kamaly, an economics professor at the American University of Cairo.

“The loan will be like an aspirin. There is no reform package in the real sense of the term, with specific goals... It’s a raft of measures to stabilise the economy and exchange debts for other debts,” he said.

The falling reserves prompted the government to hasten the IMF negotiations, and Egypt will owe $4.4 billion in interest on foreign loans by July 2017, according to a study by the investment bank Prime Holding.

“We won’t be able to pay the foreign loan interest if we don’t get” the IMF loan, former finance minister Samir Rady said.

But the government, which has nurtured a bloated bureaucracy over the years, has other commitments as well.

In his speech on Saturday, Sisi took the unusual step of addressing public sector employment which he said has put a major burden on the state.

“If I appoint 900,000 people in the public sector because of pressure for jobs, at a time when I really don’t need anything from them... what effect will this have?” he asked pointedly.

The state statistics office CAPMAS says that in 2015 almost 5.8 million people from a total workforce of 26 million were employed by government agencies and another 800,000 in the public sector.

Radwan said that part of the IMF loan “should be used in investments that can turn a quick profit”.

But the economic reforms run the risk of fuelling discontent among lower-income Egyptians and increasing inflation.

“There must be measures that demand more of the rich, because according to official statistics... 27 per cent of the population is poor, and another 20 per cent is threatened with poverty,” said Shereen Al Shawarby, an economics professor at Cairo University.

AMMAN — The Amman Stock Exchange (ASE) on Tuesday announced that Enjaz for Development & Multi Projects Company (ATCO) has completed all required procedures to increase its listed capital from JD25 million to JD35.25 million through a strategic shareholder. On its website, the ASE said it will list the company’s new shares on August 18.

DUBAI/LONDON — OPEC will probably revive talks on freezing oil output levels when it meets non-OPEC nations next month as top exporter Saudi Arabia appears to want higher prices, according to OPEC sources, although Iran, Iraq and Russia present obstacles to a deal.

Riyadh sharply raised expectations for a global production deal on Thursday when Energy Minister Khalid Al Falih said Saudi Arabia will work with OPEC and non-OPEC members to help stabilise oil markets.

“The comments by the Saudi energy minister give a positive indication that they are willing to go for a freeze deal but the question remains: on what level?” said an OPEC source from a key Middle Eastern producer.

“Will the freeze be at January levels? And what about Iran? And then there is Nigeria, which has lost a lot of production since January,” the source added.

Only days after Falih’s remarks, Russian Energy Minister Alexander Novak was quoted as saying Russia is consulting with Saudi Arabia and other producers to achieve oil market stability, adding that the door is still open for more discussions on output freeze, if needed.

Saudi Arabia, together with Russia and the United States a rival for the position of the world’s top oil producer, boosted output to 10.67 million barrels per day (bpd) in July from 10.2 million in January, when the freeze idea first emerged.

Since 2014, Saudi Arabia, OPEC’s de facto leader, has been raising output to drive higher cost producers out of the market and win back shares from rivals such as the United States, where output soared on the back of the high oil price of the past decade.

As a result, oil prices collapsed to $27 per barrel in January from as high as $115 in mid-2014, capping output of the United States but also hitting hard Saudi Arabia’s budget and resulting in a record fiscal deficit for Riyadh.

A previous attempt to freeze output at January levels to support prices collapsed in April after Saudi Arabia said it wanted all producers, including regional rival Iran, to join the initiative.

Tehran argues it needs to regain market shares lost during years of Western sanctions, which have been only softened in January.

Over the past few months, Iran, OPEC’s third biggest producer, has boosted output close to pre-sanctions levels and has repeatedly signalled it has no plans to join the freeze initiative.

“I do not see any real chance,” a source familiar with Iranian oil thinking said on Saturday in reference to the prospect of a freeze deal in September.

OPEC members will meet on the sidelines of the International Energy Forum, which groups producers and consumers, in Algeria on September 26-28.

“However, if prices go down further, some OPEC members will try to send positive signals to the market to keep prices at least at current levels,” the source added.

Iraq output gains

Iranian Oil Minister Bijan Zanganeh said in parliament last week he wanted to take the country’s output to 4.6 million bpd within 5 years — much above the current 3.6 million bpd and pre-sanction levels of 3.8-4.0 million bpd.

But since the collapse of freeze talks in April, Iran is no longer the only obstacle to the deal.

Iraq, OPEC’s second largest producer, which in April was saying it would support the deal, has since agreed with oil majors on new contract terms to develop its massive fields, which will allow output to rise further next year by up to 350,000bpd.

Nigeria and Libya could present further complicating factors, delegates said. Nigeria’s output hit its lowest in over two decades this year due to attacks on oil sites and Libya is pumping a fraction of the pre-conflict level — raising the question of what level they should limit supplies at.

While Nigeria supported April’s freeze initiative, Libya declined to join the talks.

Russia, which back in April was ready to freeze production in the first coordinated action with OPEC since 2001, also signalled it was no longer very keen on a dialogue and would continue boosting output.

Its output currently hovers near an all time high of 10.85 and Russian officials expect it to edge up further next year.

Even Saudi Arabia itself has raised its output to record levels in July, which Falih has explained was due to rising seasonal domestic demand and customers asking for more oil worldwide.

These increases arise as countries which usually do not join any global actions such as North American producers are expected to add more barrels. The International Energy Agency expects non-OPEC output to rise by 300,000bpd next year after a decline of 900,000bpd in 2015 as North American output stabilises.

Hence, persuading countries such as Iran, Iraq and Russia to return to output controls will be a difficult task for Riyadh, but a worst option would be to raise expectations of a deal that doesn’t happen, like in April.

“No agreement will collapse the market, and OPEC,” said the first OPEC source.