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WASHINGTON — The United States on Wednesday renewed a warning that Europe risks falling into a downward spiral of falling wages and prices, saying recent actions by the European Central Bank (ECB) may not be enough to ward off deflation.

In a semi-annual report to Congress, the US Treasury Department also said Berlin could do more to help Europe, namely by boosting demand in the German economy, Europe's largest.

"Europe faces the risk of a prolonged period of substantially below-target inflation or outright deflation," the treasury said.

The ECB in recent months has cut interest rates to record lows, offered banks new long-term loans, and announced plans to buy private sector assets.

All this is intended to prop up a eurozone economy teetering on the edge of recession. Europe is a major trading partner for the United States and China, and its travails have been at the centre of worries over the global economy that have shaken financial markets worldwide in recent days.

The US treasury said the ECB's actions "should help combat deflationary risks", but that "further policy support for demand may be needed”.

The report appeared carefully worded to avoid sounding pushy over what Washington thinks Germany should do. Berlin has been a key American ally for decades.

Still, the Obama administration sees Germany as a missing link in Europe's elusive recovery from what in many corners of the continent has looked like an economic depression.

"Measures to increase domestic demand, particularly in surplus countries like Germany, can help further European and global rebalancing," the treasury said. In its last report to Congress in April, it had also warned that Europe faced the risk of deflation.

Germany, which has sought to keep the focus in Europe on fiscal austerity, came under a spotlight at meetings last weekend of finance officials from around the globe who sought to convince Berlin to loosen its purse strings.

The Treasury Department also took South Korea to task for intervening in foreign exchange markets. The won has weakened 5 per cent against the dollar in six weeks.

The Obama administration has long called on Seoul to minimise currency interventions, but on Wednesday it said outright that the won was "undervalued," and urged Seoul to let it appreciate further.

Washington again called China's currency "significantly undervalued," but said Beijing appeared to be taking less of a hand in determining the yuan's value. This suggests tensions between the two powers over currency policy might be easing.

The semi-annual report examines the economic and foreign exchange policies of major US trading partners. It did not formally label any country a currency manipulator, and has not done so in any report since 1994.

Separately, the Treasury Department said this week that the US budget deficit fell by nearly a third to $483 billion in fiscal 2014, the lowest level since 2008, as a quickening economic recovery boosted tax collections and spending grew only modestly.

The deficit, down from $680 billion last year, was the lowest since a $459 billion budget gap in fiscal 2008, which was followed by four straight years of $1 trillion-plus deficits in the wake of the financial crisis.

Treasury Secretary Jack Lew and White House Budget Director Shaun Donovan hailed the data on Wednesday as a "return to fiscal normalcy" as the 2014 deficit fell to 2.8 per cent of the gross domestic product. That was the lowest since 2007 and a smaller share of the economy than the annual average for the last 40 years.

Lew told a news conference the United States was now in a period of fiscal sustainability that is providing a strong foundation for growth.

"What I don't think we have is an emergency right now," Lew said. "The challenge we have is to sustain the economic engine so that we're seeing the growth now and over these next 10 years."

The improving fiscal picture has sapped the urgency for a major budget deal between Congress and the White House aimed at slashing deficits by trillions of dollars over the next decade and starting to reduce the $17.8 trillion federal debt.

Lew insisted he has not given up on further deficit reduction, but said budget savings could not come at the expense of economic growth.

Both Lew and Donovan said growth and revenues in 2014 were helped by the easing of across-the-board budget cuts that went into effect last year, along with the lack of a fiscal crisis such as last year's federal government shutdown.

Donovan told Reuters on Tuesday he wanted to further reduce those budget cuts next year and would be willing to consider some savings to mandatory spending programmes to reach a deal with Republicans, who control the US House of Representatives.

Fiscal 2014 revenues grew 9 per cent to $3.02 trillion, boosted by a jump in individual and corporate tax receipts and a 31 per cent rise in Federal Reserve earnings, mostly from the central bank's massive bond portfolio.

Outlays grew just 1 per cent to $3.50 trillion.

For September, the treasury recorded a budget surplus of $106 billion, up from a year-ago surplus of $75 billion. Analysts polled by Reuters had expected a $80.9 billion surplus for the final month of fiscal 2014.

Receipts last month grew 17 per cent to $352 billion while outlays were up 9 per cent to $246 billion.

The Congressional Budget Office (CBO) has forecast a $469 billion deficit for fiscal 2015, which started on October 1. It expects deficits to rise again later this decade as costs associated with an ageing population mount.

"A nearly $500 billion deficit is nothing to celebrate," said a spokesman for House Budget Committee Chairman Paul Ryan, a Republican who has been touted as a possible 2016 presidential candidate. "And CBO still projects that, in the coming years, the deficit will rise even higher to unsustainable heights."

AQABA — A Turkish delegation of businessmen and investors on Thursday visited the Aqaba International Industrial Estate (AIIE) and checked on some Canadian, Turkish and British projects. AIIE Chief Executive Officer Sheldon Fink and his deputy, Mamoun Qussous, told the delegation that AIIE has attracted investments worth more than $180 million, and seeking to reach $500 million by the end of next decade. AIIE has provided more than 900 job opportunities so far, aiming to reach 3,000 at full operation phase, Qussous  said. He noted that AIIE seeks to attract businesses in metal and engineering industries, clean energy, consumer products, storing and logistic services for grand tourist projects. The delegation members expressed their desire to invest in plastic industry and logistics, and visited a Turkish grain factory and other international factories. 

PARIS — A sell-off in European stocks accelerated on Wednesday, with a key index suffering its biggest one-day slide in nearly three years as investors slashed exposure to risky assets on mounting worries about global growth.

The slump represented a wipe-off in market value of about $255 billion for European stocks listed on the broad STOXX Europe 600 index. That is more than Portugal’s gross domestic product and more than the entire market capitalisation of Europe’s biggest oil company, Royal Dutch Shell.

Shares extended their slide in afternoon trading after data showed US retail sales declined in September and prices paid by businesses fell, fuelling concern that consumer demand may be faltering while inflation is failing to gain traction.

Greek equities were among the biggest losers, as Athens’ benchmark ATG index succumbed to a second day of selling pressure and sank 6.3 per cent. Traders cited political uncertainty and a spike in Greek 10-year bond yields, which rose above 7.6 per cent.

“There’s been a big acceleration of the sell-off in stocks, with a spike in risk aversion spreading across the board to bonds and the currency market, and even a return of stress around Greek assets,” said Alexandre Baradez, chief market analyst at IG France.

“The news-flow is quickly deteriorating, including today’s US data. It’s nothing to reassure investors. All the ingredients are there for further losses,” he indicated. “In this ‘risk-off’ swing, global investors are dumping their most risky holdings, and obviously Greek stocks and bonds fall in this category.”

The FTSEurofirst 300 index of top European shares ended 3.2 per cent lower at 1,251.87 points, a level not seen since last December. It was the benchmark’s biggest one-day slide since late 2011.

The index has tumbled 11 per cent since mid-September as doubts about the strength of the global economy mount.

After Wednesday’s slump, all major European stock indexes are in negative territory for the year, with Germany’s DAX  among the worst hit, down 10.3 per cent in 2014 and on track to record its worst annual performance since 2011.

‘Bear market’ for oil stocks

The acceleration in selling was reflected in Europe’s “fear gauge”, the Euro STOXX 50 Volatility Index, which surged to 28.9 on Wednesday, its highest level since mid-2012.

Shares in oil majors and oil services companies were hammered as Brent crude fell close to a four-year low around $84 a barrel. Total fell 4.5 per cent, Repsol lost 4 per cent and Statoil dropped 2.9 per cent.

Norwegian seismic surveyor Petroleum Geo-Services  shares tumbled 3.9 per cent after the company cut its 2014 earnings forecast again, citing the fall in oil prices and worsening demand from oil companies.

The STOXX Europe 600 energy sector index is in bear market territory, down more than 20 per cent since late June.

Pharmaceuticals stocks also featured among the top losers on Wednesday, after US group AbbVie Inc. said it was having second thoughts about bidding for British peer Shire  because of changing US tax regulations. Shire’s shares plunged 22 per cent.

‘Good entry points’

 Despite the correction, a number of fund managers see buying opportunities in European equities. They cite attractive relative valuation, the European Central Bank’s recent measures to stave off deflation and support the economy and a slide in the euro currency, which should boost corporate earnings.

“A new recession in Europe has now been priced in, and the correction in stocks is getting close to an end. We now see good entry points, not exit points,” said Romain Boscher, global head of equities management at Amundi, which has 821 billion euros ($1.04 trillion) under management.

“Even with no economic growth in Europe, there are plenty of positive factors supporting equities: very low refinancing costs for companies, a sliding euro which will boost margins, and very attractive dividend yields compared with what investors get in the fixed income space,” he indicated.

AMMAN — The European Union Delegation to Jordan announced in a press statement on Wednesday the results of an assessment regarding small- and medium-sized enterprises’ (SMEs) policies in Jordan and eight other economies in the Middle East and North Africa region.

According to the press release, key stakeholders discussed reform priorities identified in a new report: “SME Policy Index: The Mediterranean Middle East and North Africa 2014, Implementation of the Small Business Act for Europe”. 

Instigated by the European Commission, the assessment was coordinated by the Organisation for Economic Cooperation and Development (OECD) in cooperation with the European Training Foundation (ETF) and in consultation with the European Investment Bank.

Based on the “Small Business Act” for Europe (SBA), a comprehensive SME policy framework adopted by the European Union (EU) to promote SMEs, it provides policy recommendations to governments to help unleash the potential of their SMEs. 

The results of the assessment, emerging from consultations with governments, public institutions, private sector organisations and civil society, have led to several recommendations.

“Jordan should continue to build a knowledge economy, attract inward-investment, lift constraints faced by enterprises operating in leading, non-energy intensive sectors such as the pharmaceutical industry, medical services and ICT, streamline administrative requirements and introduce regulatory impact analysis to help SMEs to grow,” the press statement listed as the first recommendation.

The second priority related to access to finance. 

“Strengthening creditor rights would reduce collateral requirements and open access to bank financing to a larger number of SMEs while the establishment of business angel networks would provide equity financing to small business ventures,” it said.

“Furthermore, Jordan could expedite the approval of the new bankruptcy law and monitor and evaluate its effectiveness once it is implemented,” the statement added.

 It also recommended a prompt adoption and efficient implementation of an export promotion strategy and more participation in international networks that would benefit exporting SMEs. 

“Stronger coordination between ministries, the private sector and non-governmental organisations would help to develop entrepreneurial learning for all levels of education and to promote women entrepreneurship,” the report continued.

It concluded that a systematic training needs analysis would help policy makers make informed decisions in the area of skills development.

To support the government in implementing reforms in priority areas identified in the report, such as international networks and partnerships,  a follow-up training will be organised in Amman next month.

PARIS — Global demand for oil is still weighed heavily by weak economic growth, and this together with a supply glut is pushing down prices which may fall further, the International Energy Agency (IEA) said on Tuesday.

Cutting its forecasts for growth of oil demand for the third month in a row, the IEA indicated that this trend "may have touched bottom".

And set against this, supplies may soon begin to slow down.

"Nevertheless, further oil price drops would likely be needed for supply to take a hit — or for demand growth to get a lift," the agency said in its October report.

In trading on Tuesday, benchmark West Texas Intermediate oil was being priced at about $85 for November delivery and Brent oil was at about $88.

The IEA said most Brent was profitable at $80 a barrel, and that a Saudi Arabian official had recently suggested "that the high cost of shale oil [from North America] might put a floor under prices around $90 a barrel".

Although the speed of slowing oil demand growth was a "surprise", a "staggering" increase in supplies was a bigger factor behind the fall of prices and rise of stockbuilding, the IEA indicated.

The IEA again cut its forecasts for growth of global oil demand for the third month in a row.

For this year, it expects demand to rise by 700,000 barrels per day (bpd) to 92.4 million bpd which is 200,000 bpd less than the previous forecast.

This shrinking demand outlook in European and Asian members of the Organisation for Economic Cooperation and Development (OECD) matched average growth of 1 million bpd in countries outside the OECD areas, the IEA said.

The IEA is the oil-policy arm of the OECD which groups 34 advanced democracies.

For next year, the agency cut its estimate of global demand from 93.8 million bpd to 93.5 million bpd.

However, that represents an increase of 1.1 million bpd from the level this year because demand will pick up somewhat as the global economy brightens, pulled by emerging economies, the IEA explained.

September 'high-water mark' 

"While the abrupt slowdown in demand growth in the second quarter of 2014 has come as a surprise, supply growth looms larger as a factor behind the recent easing of market balances and OECD stock builds," the report said.

"It jumped to a staggering 2.8 million bpd in September year on year, as output from Organisation of Petroleum Exporting Countries swung back to growth for the first time in about two years," it added.

The agency indicated that "abundant" supplies, slowing demand and strength of the dollar had pushed down oil prices for the third month in a row, and the price of Brent oil for October delivery had fallen to less than $90 a barrel in October.

However, these steep price falls since June, with Brent oil price at four-year lows, "are casting doubt on the sustainability of current high supply growth rates", the IEA warned.

The IEA said "September may turn out to be a high-water mark for supply”.

This was also because growth from outside OPEC was expected to slow in the last quarter of this year, and because political risk to output in Libya and Iraq was "exceptionally high".

The IEA estimated that global production rose in September by 910,000 bd from the August level to 93.8 million bpd.

Output from the Organisation of Petroleum Exporting Countries (OPEC) rose by 415,000 bpd to 30.66 million bpd, boosted by increased output from Libya and Iraq.

Other producer countries increased their output by 495,000 bpd to 56.7 million bpd, owing to the end of maintenance stoppages in North America, the North Sea, Russia and eastern Europe.

At PVM oil market analysts in London, David Hufton commenting on the IEA report, said: "It makes no sense at all for OPEC members to try and defend price by cutting production only for non-OPEC producers to jump in and grab market share."

AMMAN — Omar Razzaz was appointed as chairman of the Jordan Ahli Bank (JAB) on Tuesday, succeeding Rajai Muasher, who resigned to “enable a new generation to lead the bank”, Al Rai reported. Saad Muasher was appointed as deputy chairman, succeeding Nadeem Muasher, who also resigned. The former JAB chairman noted that Razzaz, who also chairs the King Abdullah II Fund for Development’s board of trustees, was chosen due to his leadership skills and ability to deal with the requirements of the upcoming stage. Razzaz will not resign his positions in other institutions.

NEW YORK — Brent oil prices fell more than $2 a barrel to less than $88 on Monday, its lowest since 2010, after key Middle East producers signalled they would keep output high even if that meant lower prices.

Brent oil prices have tanked by nearly 25 per cent since June as ample supply coincided with weak demand, raising the possibility that the Organisation of the Petroleum Exporting Countries (OPEC) could cut output.

But Saudi Arabia has privately told oil market participants it can accept oil prices between $80 and $90 a barrel, sources briefed by OPEC's biggest producer told Reuters.

Kuwait's oil minister said on Sunday OPEC was unlikely to cut production to support prices. OPEC is due to discuss output at its next meeting November 27.

"It suggests there's some nervousness in the market that Saudis are seeking to bring pressure on the shale producers in the US," said Gene McGillian, an analyst at Tradition Energy.

"The market is in search of a bottom and we're in the process of finding it, we just have to see what OPEC does and where the economy goes," McGillian added.

Early on Monday, Brent crude touched its lowest since December 2010 at $87.74. But Brent pared losses, trading down $2.04 on the day at $88.17 by 1512 GMT. US crude was down $1.12 at $84.70.

Growth in China's exports and imports trumped forecasts in September, and the world's largest energy consumer increased crude oil imports by 9.5 per cent from August, lending limited support to prices.

Consuming countries like China and India often build up stockpiles when prices are low.

Oil prices could be on the brink of sliding another $10 or more, some analysts said. They say a drop of over 20 per cent since June has wiped out key support levels and left behind a "technical graveyard".

"If Brent closes below $88.49, I'm pretty certain that further downward pressure can be expected until the next significant level at $82.35," said Tamas Varga, an analyst at brokerage PVM Oil Associates in London.

Iraq cut its November oil prices for customers in Asia and Europe on Sunday, following a similar move by Saudi Arabia last week.

Kuwait's Oil Minister, Ali Al Omair, was quoted as saying by state news agency KUNA on Sunday that $76 to $77 a barrel might be the level that would end the oil price slide, since that was the cost of oil production in the United States and Russia.

"We are firmly entrenched in the bear market, not only in Brent, but also in WTI," said Tariq Zahir, analyst at Tyche Capital Advisors. "I would be surprised if in the next month we break $80, barring a hurricane or ISIS going into the Southern part of Iraq."

AMMAN — Kamel Mahadin, chief commissioner of the Aqaba Special Economic Zone Authority (ASEZA), on Monday underlined the importance of increasing the trade volume between Jordan and Turkey. He made his remarks at a meeting with a Turkish economic delegation, during which he noted that around $100 million worth of projects have been implemented in ASEZA during the last two years. Mahadin cited a $54 million agreement with the Turkish Sanmar Company to build seven trailers for the Aqaba Port Company for Marine Services.  

AMMAN — Planning and International Cooperation Minister Ibrahim Saif met with World Bank (WB) President  Jim Yong Kim and other officials from the bank during his recent participation in the WB and the International Monetary Fund (IMF) annual meetings. He also spoke at a roundtable discussion held by the WB with the private sector and was the key speaker at a ceremony to launch the bank's report on jobs and incentives in the Middle East and North Africa region. 

AMMAN — The Second Arab-British Economic Forum, to be held in London next week, will offer a "big" opportunity to promote Jordan's investment environment, according to Jordan Chamber of Commerce President Nael Kabariti. In a statement, he said the forum is organised in cooperation between several bodies, including the chamber and the Arab League, adding that a delegation of officials and representatives of the private sector will take part in the event. Kabariti noted that the trade volume between Jordan and the UK reaches £11 billion each year.