Business

AYIA NAPA, Cyprus — Beside sparkling Mediterranean waters at the Cypriot resort town of Ayia Napa, the bars are bouncing with foam dance parties as tourist numbers rebound following two tough years of pandemic.

But one key nationality is effectively missing: Russian visitors, as the once lucrative market has been hit by European Union sanctions imposed after Moscow invaded Ukraine.

"This year, we expected 800,000 Russian tourists," said Haris Loizides, head of the Cyprus Hotel Association. 

The Russian market "was wiped out from one day to the next", said Christos Angelides, head of the Pancyprian Association of Hotel Managers. "Nobody was prepared for this huge change."

The key tourism sector, which had contributed 2.68 billion euros ($2.72 billion) in 2019, 15 per cent of gross domestic product, is still counting the cost of the disastrous years of COVID travel chaos.

In 2019, before the start of the COVID-19 pandemic, one fifth of the tourists were Russians — 782,000 out of 3.9 million — making it the holiday island's second largest market after Britain.

Last year, despite tough COVID travel restrictions, that share rose to more than 25 per cent, with arrivals from Russia totalling nearly 520,000 out of 1.93 million.

Operators had hoped this summer would see Russian numbers return to pre-pandemic levels.

Flight bans, banking sanctions 

Some 18,000 Russians are resident in Cyprus, many in the seaside town of Limassol — dubbed by some "Moscow on the Med".

But, with EU sanctions on Russia continuing and with no let-up in the bloodshed on Ukraine's battlefields, just 17,000 Russian tourists came to Cyprus between January and June. 

"Our hotel is doing well, but others — who had 100 per cent Russian clientele — are not," said Angelides, who is also manager of the Napa Mermaid Hotel.

Nicosia and Moscow have close political and cultural ties, but when Russia sent troops into Ukraine, the Cypriot parliament unanimously passed a resolution condemning the invasion.

Cyprus, the EU's most easterly member, backed the bloc's actions on Moscow, including a flight ban and sanctions barring some Russian banks from the SWIFT financial system.

The tourism ministry says fewer Russian visitors could mean some $600 million in potential lost earnings.

Overall, tourist arrivals in Cyprus are bouncing back, thanks to strong demand in other key markets following the lifting of coronavirus restrictions.

From January to June, Cyprus recorded 1.2 million visitors, nearly five times the level last year, and the white sand beaches at Ayia Napa are crowded with sunseekers and partygoers.

But that is still 25 per cent down on the same period of 2019, when 1.63 million tourists came to Cyprus.

"We have somewhat limited the damage, but it is impossible to replace this huge number of customers," Angelides added.

'Big gap' 

In the first half of this year, British tourists made up nearly two-fifths of visitors, followed by "Israelis", making up 7 per cent of visitors, then Poland, Germany and Greece.

"There have been many attempts by several sectors to encourage tourists from other markets, such as the German, Polish, Italian and French markets," said Charis Papacharalambous, spokesman of the Association of Cyprus Travel Agents.

But it was still "very difficult to fill the big gap" left by Russian tourists, he added, with industry experts fearing the impact may still worsen, since many Russians previously preferred to visit later in the year.

For Loizides, from the island's Hotel Association, the war in Ukraine has also provided another problem.

Surging global costs of fuel sparked by the conflict have driven electricity prices higher. 

With tourists turning air conditioning on full blast to counter the sweltering heat of Cyprus, hotels are struggling with "astronomical bills", Loizides said.

"The EU must remedy this situation and help companies, especially at a time when inflation is raging," he added.

SAN FRANCISCO — Uber on Friday said it will let drivers in the United States see trip details before deciding whether to accept them — a new feature long sought by drivers.

A common lament by drivers at the app-summoned ride platform has been that they have to accept a request before learning where trips will take them, or how profitable they will be.

"Our new trip request screen makes it easier for drivers to decide if a trip is worth their time and effort by providing all the details — including exactly how much they'll earn and where they're going — upfront," chief executive Dara Khosrowshahi said in a blog post.

Revealing details only once a driver had accepted a trip was seen as a way to ensure riders would get picked up promptly, and not be snubbed because they were headed to locations deemed undesirable by drivers.

But Khosrowshahi said drivers have made it clear that they want more flexibility and choice.

Uber said the new feature, called Upfront Fares, was tested in several cities and was a success with drivers while resulting in shorter wait times for passengers.

The ride-sharing firm will also shift from sending drivers a single ride request at a time, to letting them pick from a list of detailed passenger requests in an area.

Uber is engaged in a long-term effort to prove that its business model is socially and economy viable.

The "gig economy" — which uses temporary independent contractors for short-term tasks — has grown rapidly since Uber's launch in 2009 and is promoted as a flexible way for people to earn money without the constraints of a full-time job.

But there has been growing backlash in countries around the world about the conditions and dangers gig workers face.

Uber driver ranks — which shrank during the COVID-19 pandemic — have not rebounded as quickly as demand for rides, and soaring fuel costs have made the gigs less attractive.

The firm in March announced a surcharge on both rides and Uber Eats meal deliveries that would go directly to drivers to help offset high fuel prices.

AMMAN — Arab Bank Group reported a net income after tax for the first half of 2022 $252 million compared with $182.4 million for the same period last year, recording a 38 per cent increase, according to a statement.

The group loan portfolio grew by 6 per cent to reach $35.7 billion at the end of June compared with $33.8 billion for the same period last year while customer deposits grew by 2 per cent to reach $47.1 billion compared with $46 billion for the same period last year, according to the group statement.

The increase in loans and deposits in most areas of operations are in line with the bank’s sustainable growth strategy to expand and diversify its clients, loans and deposit base. 

Moreover, the group maintained its strong capital base with a total equity of $10.2 billion.

In the statement, Sabih Masri, chairman of the board of directors, said, “the performance in the first half of the year reflects the group’s prudent operating policies and strong financial position, despite challenging economic environment”.

The bank’s chief executive officer, Randa Sadik said the underlying performance of the group continues on its growth path with 6 per cent growth in its net operating income across the bank’s lines of business, driven by improvement in both net interest income and commission income by 4 per cent and 17 per cent, respectively.

The group’s liquidity remains strong where loan-to-deposit ratio stood at 75.9 per cent and asset quality remains high with credit provisions held against non-performing loans continuing to exceed 100 per cent, she added.

The Arab Bank has continued its digital transformation journey which is a major pillar in the bank’s strategy, providing a comprehensive range of banking solutions and services that cater to the evolving banking needs of its customers. It has recently released pioneer applications in Jordan, including “Arabi Next” application; targeting small and medium enterprises and “Arabi Junior” application; targeting children and teens. This is in addition to Arab Bank’s ongoing updates to “Reflect”, the first Neobank in Jordan, as part of the bank’s constant efforts to deploy the latest digital banking technologies, according to the statement.

Arab Bank was named “Best Bank in the Middle East 2022” for the 7th consecutive year by New York-based international publication “Global Finance”.

WASHINGTON — Elon Musk on Friday filed claims against Twitter as he fights back against the tech firm's lawsuit demanding he be held to his $44 billion buyout deal.

Musk's counter-suit was submitted along with a legal defence against Twitter's claim that the billionaire is contractually bound to complete the deal he inked in April to buy Twitter, the Chancery Court in the state of Delaware said in a notice.

The 164-page filing was submitted as being "confidential", meaning the documents were not accessible by the public, the notice indicated.

Rules of the court, however, require Musk to submit a public version of the filing with trade secrets or other sensitive information redacted.

A judge has ordered a five-day trial over Twitter's lawsuit against Musk to begin on October 17.

The Tesla boss wooed Twitter's board with a $54.20 per-share offer, but then in July announced he was "terminating" their agreement on accusations the firm misled him regarding its tally of fake and spam accounts.

Twitter, whose stock price closed at $41.61 on Friday, has stuck by its estimates regarding accounts run by software "bots" rather than people, and argued that Musk is contriving excuses to back out of the contract.

The social media platform has urged shareholders to endorse the deal, setting a vote on the merger for September 13.

"We are committed to closing the merger on the price and terms agreed upon with Mr Musk," Twitter Chief Executive Parag Agrawal and board chairman Bret Taylor said in a copy of a letter to investors.

Billions of dollars are at stake, but so is the future of Twitter, which Musk has said should allow any legal speech — an absolutist position that has sparked fears the network could be used to incite violence.

BUENOS AIRES — Thousands of people demonstrated in Buenos Aires on Thursday, demanding a "universal salary" in crisis-ridden Argentina.

Protesters congregated outside the presidential palace, where centre-left President Alberto Fernandez was meeting his economy minister Silvina Batakis, who is opposed to such an idea, as rumours abound that a Cabinet reshuffle is in the works.

"Poverty has taken control of the country," Monica Sulle, a leader of the Socialist Workers' Movement (MST), said.

Argentina is gripped by an economic crisis marked by soaring inflation and rapid currency devaluation.

Radical leftist groups close to the Frente de Todos (Everyone's Front) ruling coalition have for weeks been demanding a universal living wage.

They are angry at the government for the deteriorating social conditions faced by ordinary Argentinians.

Protesters want a minimum living wage worth 67,000 pesos (around $490 at the official exchange rate), which amounts to the cost of two basic food baskets, for the country's lowest earners.

Some 37 per cent of Argentina's 45-million population live in poverty, while inflation for the first half of the year topped 36 per cent.

"This unstoppable inflation is taking a seat at the family dinner table at every level of society, but in the poorest sectors it's a catastrophe," said Vilma Ripoli, a Workers' Leftist Front leader.

Argentina, which earlier this year renegotiated repayments on a $44 billion loan with the International Monetary Fund (IMF), has committed to reducing its public deficit from 3 per cent in 2021 to 0.9 per cent by 2024.

Batakis has just returned to the country from Washington, where she met IMF managing director Kristalina Georgieva.

Local press has been speculating that Batakis, who has been in the post for less than a month since the resignation of Martin Guzman, could be one of the heads to roll in a cabinet reshuffle.

SEOUL — South Korean chip powerhouse Samsung Electronics said on Thursday that second-quarter operating profits were up 12.18 per cent, with record profits in its system semiconductor division despite global supply chain woes.

The company's "system semiconductor businesses... achieved a record high quarterly profit", Samsung said in a statement, adding it had both expanded its product line-up and increased the supply of chips to global customers.

"Earnings in the Memory Business improved both year-on-year and quarter-on-quarter as the Company focused on meeting solid demand for servers," Samsung said.

In June, the company became the first chipmaker in the world to mass-produce 3 nanometre microchips as it sought to match and eventually outpace Taiwan's TSMC in the race to manufacture the world's most advanced chips. 

The new chips will be smaller, more powerful and efficient, and will be used in high-performance computing applications before being put into gadgets such as mobile phones.

The vast majority of the world's most advanced microchips are made by just two companies — Samsung and TSMC — both of which are running at full capacity to alleviate a global shortage.

Samsung is the market leader in memory chips, but it has been scrambling to catch up with TSMC in its advanced foundry division, which makes high-tech microchips for other companies.

Samsung, which is also a world leader in handset production, said demand and profits from its smartphone division were down from the first quarter.

"Overall market demand declined from the previous quarter amid geopolitical issues and concerns over inflation on top of continued weak seasonality," it said.

"Profitability decreased from the previous quarter at some degree due to rising costs of components and logistics as well as negative effects of foreign exchange movement," it added.

But overall, the weakness of the Korean won against the US dollar benefited the company, it said in the statement, "resulting in an approximately 1.3 trillion won [$994 million] company-wide gain in operating profit compared to the previous quarter".

Weak chip market

Samsung's mobile business is "expected to improve in the second half of the year from the second quarter, which was heavily affected by external elements such as the war in Ukraine", Park Sung-soon, an analyst at Cape Investment & Securities, said .

But decreased market demand for memory chips due to concerns over a possible global recession will hamper the company's profit outlook, he said.

"What determines Samsung's overall profit is its semiconductor business. With what's expected to be faltering demand for memory chips down the road, sales could weaken in the second half of the year." 

Global demand for chips is "entering a period of weakness, which will persist through 2023", Richard Gordon, an analyst at research company Gartner, said in a report, according to Bloomberg.

"We are already seeing weakness in semiconductor end markets, especially those exposed to consumer spending."

The supply of memory chips has become an issue of global geopolitical significance recently, with leading governments scrambling to secure advanced chip supplies.

That was demonstrated in May when US President Joe Biden kicked off a South Korea tour by visiting Samsung's sprawling Pyeongtaek chip plant.

Russia's invasion of Ukraine has "further spotlighted the need to secure our critical supply chains", Biden said at the plant, underscoring the importance of bolstering technology partnerships among "close partners who do share our values".