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Dubai plans record spending to revive its economy

By - Dec 29,2019 - Last updated at Dec 29,2019

Dubai projects record spending of $18.1 billion, according to its 2020 budget unveiled, on Sunday (AFP photo)

DUBAI — Dubai unveiled a 2020 budget on Sunday projecting record spending of $18.1 billion, up 17 per cent on this year, as the emirate seeks to revive its economy.

The Gulf city state expects revenues too to rise sharply next year as it hosts Expo 2020, the global six-month trade fair set to open on October 20.

But it still foresees a deficit for the fourth year in a row of $700 million.

The government is hoping that Expo will draw some 25 million visitors, many of them from abroad, and is projecting a 25 per cent increase in revenues to $17.4 billion.

Dubai is the only government in the Gulf not dependent on hydrocarbon revenues, and projects around 94 per cent of income to come from non-oil sources.

Dubai is renowned for its skyscrapers, like the world’s tallest building Burj Khalifa, but its key property sector has been sliding since 2014.

Last year, growth slowed to 1.94 per cent, less half the 2017 figure and the worst in a decade. 

It picked up slightly to 2.1 per cent in the first half of this year but the government is keen to do more to stimulate consumer spending and the real estate market.

French government, unions exchange barbs in strike deadlock

The ongoing strike could surpass the longest transport strike in France

By - Dec 29,2019 - Last updated at Dec 29,2019

PARIS — The French government and a key trade union on Sunday exchanged bitter accusations over who was to blame for France's over three-week transport strike against pension reforms, as the stalemate showed little sign of relenting.

Deputy Transport Minister Jean-Baptiste Djebbari accused the hardline CGT union of a "systematic opposition to any reform" while the union's chief Philippe Martinez charged the government with strewing "chaos" in the conflict.

The strike — now longer than the notorious 22-day strike of winter 1995 — has lasted 25 days and is on course to surpass the longest transport strike in France which lasted for 28 days in 1986 and early 1987.

Aside from two driverless lines, the Paris metro was again almost completely shut down on Sunday while only a fraction of high-speed TGV trains were running.

The government and unions are only due to hold their next talks on January 7, two days ahead of a new day of mass demonstrations against the reform which is championed by President Emmanuel Macron.

In an interview with the Journal de Dimanche newspaper, Djebbari angrily accused the CGT of "attitudes of intimidation, harassment and even aggression" against railway workers who had opted not to down tools.

He accused the CGT of showing a "systematic opposition to any reform, of blocking and sometimes intimidation".

"The CGT wants to make its mark through media stunts. But the French are not going to be duped by the extreme-left politicisation of this movement," he added.

 

 'Like Thatcher' 

 

But in an interview with the same newspaper, Martinez accused the government of trying to ensure the conflict deteriorated further.

"Emmanuel Macron presents himself as a man of a new world but he is imitating Margaret Thatcher," he said, referring to the late British prime minister who sought to break the power of the unions in 1980s stand-offs.

"There is real anger. Of course, not being paid for 24 days is tough. But the conflict is the result of two-and-a-half years of suffering," Martinez added.

He said he was awaiting concessions from Macron in a New Year's address on Tuesday evening as well as recognition that "most people are not happy and that he [the president] was wrong".

The French president, elected in 2017 on pledges to reform France, has remained virtually silent on the stand-off, save for a call for a Christmas truce that went unheeded and a vow not to take a presidential pension.

This will intensify attention on December 31 address, with all eyes on whether Macron offers steps tao defuse the conflict or indicates he is ready for a long, grinding stand-off.

The unions are demanding that the government drops a plan to merge 42 existing pension schemes into a single, points-based system.

The overhaul would see workers in certain sectors — including the railways — lose early retirement benefits. The government says the pension overhaul is needed to create a fairer system.

But workers object to the inclusion of a so-called pivot age of 64 until which people would have to work to earn a full pension — two years beyond the official retirement age.

There have been signs of progress in specific sectors, with the government offering concessions to dancers at the Paris Opera who have been on strike to protect their special scheme.

The main French pilots union SNPL also last week cancelled planned strike action on January 3 following talks with the government.

There was expected to be an improvement in Paris metro services on Monday — but still with severe disruptions — with two lines closed and 12 lines offering a partial service.

Dollar restrictions push prices up; importers struggle to secure sufficient hard currency

Lebanese businesses fight for survival

By - Dec 28,2019 - Last updated at Dec 28,2019

Lebanese protesters shout slogans outside a branch of BLC Bank in Beirut on Saturday in protest against nationwide imposed restrictions on dollar withdrawals and transfers abroad in an attempt to conserve dwindling foreign currency reserves (AFP photo)

BEIRUT — After decades of hard work, self-made Lebanese chocolatier Roger Zakhour thought he would finally be able to pass a successful business to his daughter. But then the economic crisis hit.

Instead of reaping profits this Christmas, he and his 29-year-old daughter are marking down their handmade ice cream logs.

"If it continues like this, in a few months I'll be bankrupt," the 61-year-old said sitting in his small shop, surrounded by colourful stacks of hand-crafted pieces of chocolate.

In protest-hit Lebanon, a free-falling economy, price hikes and a severe dollar liquidity crunch have left local businesses struggling to stave off collapse.

Zakhour started making different kinds of chocolate and then ice cream in the 1990s, refining his recipes until he became a go-to for five-star hotels and well-off Lebanese.

But as the economy worsened over the autumn, high-end hotels drastically reduced their orders and walk-in customers became rare.

Banks have restricted access to dollars since the end of the summer, sending prices soaring as importers struggle to secure enough hard currency to buy supplies.

"We're heading somewhere we never imagined we would," said Zakhour, who had just upgraded his kitchen when sales dropped off.

 

Support fellow citizens 

 

In pursuit of high-quality products, Zakhour imports his ingredients, paying in euros or dollars.

But with withdrawals restricted and no transfers abroad, that is no longer viable.

"Now when something runs out, that's it," he said.

Unprecedented protests have swept Lebanon since October 17, with people from all backgrounds demanding a complete overhaul of a political class they deem useless and corrupt.

The government stepped down on October 29, but endless political deadlock has delayed a new one being formed to tackle the urgent need for economic reforms.

Zakhour's business is just one of thousands struggling to stay afloat.

Many Lebanese have been forced to close shop, and a large number have been fired or seen their salaries slashed by half, even as the cost of living increases.

Watching all this unfold, 31-year-old nursery school teacher Lea Hedary Kreidi and her family racked their brains to see how they could help.

Shortly after protests started, they launched a group on Facebook called "Made in Lebanon — The Lebanese Products Group" to encourage Lebanese to buy locally produced goods.

In just two months, they amassed more than 32,000 members, who post ads for locally or homemade goods, or ask for local alternatives to imported products.

 

'Made in Lebanon' 

 

"We're used to going shopping and buying what our mothers used to buy. We grab what's in front of us without checking if it's made in Lebanon or not," she said, seated at home by a sparkling Christmas tree.

But there are locally made options for numerous products, including detergent, shampoo, nappies, peanut butter, ketchup, and children's building blocks.

"I was surprised by how many things there were that I didn't know about," said the mother of a baby boy.

In her drive to support her fellow citizens, Kreidi now skips her usual supermarket in favour of nearby small grocers.

This Christmas, only the children in her family will be receiving presents, which will all be made in Lebanon.

In Beirut, bar manager Rani Al Rajji says he is also having to adapt — moving away from increasingly expensive imports while also remaining affordable.

"As much as I can, I'm trying to lessen the blow so our guests don't feel they've lost their purchasing power and can no longer afford to go out," said the 43-year-old, who is also an architect.

To do this, he and his co-founders are trying to increase local brands from a fifth to around a half of all bar and kitchen supplies.

"We're trying to use local products for all those with an alternative made in Lebanon," he said, sitting at the bar.

They are also attempting to cut out unnecessary packaging and marketing costs, serving wine directly from the barrel and beer from the keg.

"We can't replace everything, but we can try to give Lebanese products more life, encourage their consumption," he said.

But some cash-strapped consumers say buying local is not their chief concern.

In a Beirut supermarket, 35-year-old Mariam Rabbah clutched a nearly empty basket wondering what to buy with her diminished salary.

"Everything is more expensive and we're now paid half," she said.

"Now what we care about is if something is cheap and good quality — not whether it's imported or Lebanese."

German union calls New Year strike at Germanwings

By - Dec 28,2019 - Last updated at Dec 28,2019

FRANKFURT AM MAIN — A German cabin crew union on Friday called a three-day strike at Lufthansa subsidiary Germanwings, plunging passengers into turmoil over the busy end-of-year holiday as it ramps up a bitter row over pay and conditions.

The UFO union said Germanwings employees would strike from 23:00 GMT on Sunday until 23:00 GMT on Wednesday as talks with bosses remain deadlocked.

The strike period covers New Year’s Eve and the January 1 public holiday.

“We are deliberately announcing the strike early so Germanwings passengers have a chance to book flights with other airlines or make alternative travel plans,” said UFO vice-chairman Daniel Flohr in a video message.

The union stopped short of announcing a fresh stoppage at flagship carrier Lufthansa itself, but warned that more strike calls could follow from January 2.

Flohr said UFO took stoppages at this time of year — when many people are travelling to meet friends and family — “very seriously”.

But Germanwings management had “given its employees no clear options for the future”, he argued.

A Lufthansa spokesman had earlier condemned the union’s latest strike threats, saying “this is no way to resolve the conflict”.

Board member Detlef Kayser said in a statement that “UFO has refused for weeks to put concrete demands in writing”.

 

Increasingly bitter 

 

Lufthansa and UFO have for months been locked in an increasingly bitter dispute that has triggered repeated walkouts.

A 48-hour stoppage at the main Lufthansa brand led to 1,500 cancellations at German airports in November, affecting 200,000 passengers.

A one-day warning strike in October prompted several dozen flight cancellations at Lufthansa subsidiaries Eurowings, Germanwings, SunExpress and Lufthansa CityLine.

As well as demanding higher wages, especially for entry-level jobs, the UFO union is seeking better benefits and easier routes into long-term contracts. 

Lufthansa for a long time refused to discuss the demands, claiming the union no longer had the right to represent its 22,000 cabin crew employees owing to an internal leadership struggle.

The company even challenged UFO’s legal status in court.

But the group changed its stance during November’s massive strike, agreeing to arbitration with UFO leaders and two mediators.

The UFO union on Sunday said those talks “had failed”.

Both sides have agreed to keep details of the talks confidential but German media reported they could not even agree on which topics should be covered by the arbitration.

Aside from pushing its demands for better pay, UFO is reportedly also seeking assurances that certain staff members will not face disciplinary action over the strikes.

Lufthansa said it was putting its hopes in a fresh round of talks proposed by the mediators for January, but UFO denied a new date had been agreed.

China slashes red tape for IPOs

By - Dec 28,2019 - Last updated at Dec 28,2019

Chinese lawmakers on Saturday approved an amendment to the country’s securities law that will help protect investors and prevent insider trading (AFP photo)

BEIJING — Chinese lawmakers agreed on Saturday to slash red tape for initial public offerings, approving an amendment to the country’s securities law that also aims to better protect investors and prevent insider trading.

Mainland authorities have recently stepped up moves to attract listings of big tech firms, including launching a new technology board in Shanghai in July, as the country’s economy has stuttered to its slowest rate of growth since the early 1990’s.

“This amendment is a big breakthrough as it cuts red tape and the cost for companies when going public,” said Dong Dengxin, director of the Finance and Securities Institute at Wuhan University of Science and Technology. 

“It is the most significant revision of the Securities Law in history.”

The new registration-based IPO system in the newly amended law — which comes into effect on March 1, 2020 — requires strict information disclosures from companies seeking to list. 

The listings, however, do not need approval from the China Securities Regulatory Commission, according to a draft law published on Saturday. 

It has also removed the need for companies to be profitable before listing.

The revised law includes better protections for minority investors, said Gong Fanrong, director of the finance committee legal team under China’s National People’s Congress.

It calls for companies to establish dispute resolution mechanisms to address shareholder grievances and improve transparency, he added.

Companies found guilty of making false or misleading statements or withholding important information from shareholders could face penalties ranging from one to 10 million yuan ($ 143,000 to $1.4 million).

It also includes tougher punishments for securities fraud and insider trading. 

Individuals found guilty of insider trading will be fined two to ten times the value of their ill-gotten gains.

Intermediaries and professional services firms found guilty of faking information during IPOs will be fined two million to 20 million yuan, compared to 300,000 to 600,000 yuan at present.

The law also says securities industry employees, including regulators and those who work for brokerages or stock exchanges are bared from trading in stocks.

Lawmakers have debated amendments to China’s securities law for nearly five years.

Russia vows to complete Nord Stream 2 by end of 2020

By - Dec 28,2019 - Last updated at Dec 28,2019

MOSCOW — Russian Energy Minister Alexander Novak said on Friday that a controversial gas pipeline would be completed by the end of next year, adding Moscow could use its own pipe-laying vessel to skirt US sanctions.

Nord Stream 2, which aims to double Russia's natural gas deliveries to Germany, was slated for completion in early 2020 with a view to being operational in mid-2020.

The United States has long opposed the 9.5 billion-euro ($10.6 billion) project and the US Senate voted last week to slap sanctions on companies working on it. 

The American announcement of asset freezes and visa bans targeting companies involved in the project immediately led to Swiss pipe-laying contractor Allseas halting its work on the remaining stretches.

"Nord Stream 2 will be launched by the end of 2020," Novak told reporters on Friday.

He said Russia could use its own vessel — The Academician Chersky — to finish laying the pipeline, adding it was currently stationed in the Far East.

"Some time is needed for additional preparations," Novak added.

An energy ministry source said the vessel would have to be outfitted with necessary equipment.

Earlier this week, President Vladimir Putin's spokesman Dmitry Peskov confirmed that Russia has "certain capacity" to finish the project "in the foreseeable future" but declined to provide details.

The pipe-laying vessel has been operated by Gazprom Fleet, a subsidiary of gas giant Gazprom since 2016.

Washington insists the pipeline would give Russia too much influence over security and economic issues in western Europe.

Germany has accused the United States of interfering in its internal affairs and an EU spokesman said the bloc was opposed "as a matter of principle to the imposition of sanctions against European companies engaged in legal activities".

Swiss minister says Facebook’s Libra has ‘failed’ in current form

By - Dec 28,2019 - Last updated at Dec 28,2019

SAN FRANCISCO — The Swiss president and finance minister has delivered the latest blow to Facebook's planned Libra cryptocurrency, saying it has "failed in its current form", Swiss network SRF reported on Friday.

"The central banks are not going to accept the basket of currencies" that Libra is supposed to be based on, Ueli Maurer, who is in his final days in the rotating presidency of the Swiss Confederation, Switzerland's federal council, told SRF.

Libra, a high-profile project of social network giant Facebook, is tentatively scheduled for a 2020 launch but has faced months of severe criticism from some of the world's most influential financial authorities. 

In theory, Libra will be managed by a Geneva-based independent association linking several companies and non-profit groups.

But since early October, the online payment companies PayPal and Stripe, as well as Visa, Mastercard and others, have withdrawn from the project amid growing pressure from American and other regulators. 

They have cited the potential for illicit uses of the currency and have underscored the battered reputation of California-based Facebook in matters of privacy and data protection.

 

 Loss of 'sovereignty' 

 

Countries and central banks — for now the only entities legally permitted to issue currency — have also expressed concern about a blow to their sovereignty.

In October, French Economy Minister Bruno Le Maire bluntly expressed his concerns, saying, "Libra is not welcome on European soil."

"We will take steps with the Italians and Germans, because our sovereignty is at stake," he said, speaking in Washington on the sidelines of the fall meeting of the World Bank and International Monetary Fund.

Earlier this month, a US Federal Reserve (Fed) official expressed American reservations. 

"Without requisite safeguards, stablecoin networks at global scale may put consumers at risk," Fed Governor Lael Brainard said in a speech in Frankfurt. 

Cryptocurrencies to date have suffered from "staggering" losses due to fraud and theft, Brainard said.

 

 'Serious concerns' 

 

Stablecoins are a type of cryptocurrency designed to provide stability — avoiding the wild swings of bitcoin and other cryptocurrencies — by being pegged to relatively stable assets or currencies. 

Libra is designed to make it easy for users of WhatsApp, a Facebook-owned messaging platform, to instantly send funds to friends or family.

The size of Facebook — 2.2 billion people worldwide connect on at least one of its platforms, which also include Instagram, WhatsApp and Messenger — would give it the potential to disrupt the global financial system, making it far harder for central banks to manage, Fed Chairman Jerome Powell told US lawmakers in July. He expressed "serious concerns". 

The Libra association declined to comment when contacted by AFP.

But in October, Facebook CEO Mark Zuckerberg testified before a congressional committee that Libra would not be launched until it received all necessary authorisations from the authorities.

In response to regulators' resistance, Zuckerberg last month opened the door to scaling back plans for Libra if it cannot win the needed approvals.

Amazon workforce surges for holiday spree

By - Dec 26,2019 - Last updated at Dec 26,2019

WASHINGTON —Amazon said on Thursday it added some 250,000 employees to handle operations for "record" holiday sales for the online giant.

The full and part-time seasonal employees were added in Amazon's "fulfillment network", the sprawling system of warehouses and delivery operations, according to the company, which now has a workforce of 750,000.

"This holiday season has been better than ever, thanks to our customers and employees all around the world," said Chief Executive and founder Jeff Bezos.

Amazon, which was already among the world's largest private global employers behind Walmart, with more than two million workers, has been ramping up investment as it moves to offer one-day delivery on most sales.

The company did not indicate how many of the seasonal workers would remain after the holiday season.

The Amazon jobs figure excludes some 800 private delivery contractors who employ an estimated 75,000 drivers in the United States.

Amazon offered no specific sales figures for the holiday period but said it was "record-breaking" with "billions of items" ordered worldwide including tens of millions of Amazon-branded devices.

It said some of the best-selling products included its Alexa-powered electronics such as the Echo Dot smart speaker, Fire TV stick and video-enabled Echo Show 5.

While Amazon is best known for its dominant online retail service, but also has a major cloud computing platform and operates in streaming media, artificial intelligence along with brick-and-mortar grocery and book stores.

It has its own lineup of consumer electronics and other branded merchandise.

A major revenue driver for Amazon is the Prime membership service which includes free shipping for most items as well as streaming video, music and other perks.

US stocks drift higher, adding to 2019 bounty

Asian equities up in post-Christmas trade

By - Dec 26,2019 - Last updated at Dec 26,2019

A homeless man sits along Wall Street during the beginning of the Christmas holiday week, on Monday, in New York City (AFP photo)

HONG KONG/ NEW YORK —  Wall Street stocks drifted higher in early trading on Thursday, adding to a heady December that looks poised to cap a good year for equities.

Investors were expecting light trading volumes in New York on the day after Christmas, traditionally a sleepy session and a day when major stock markets are closed.

"Liquidity isn't running dry, but it is parched with so many other major markets around the world closed and so many US participants remaining in holiday mode," said Briefing.com analyst Patrick O'Hare.

About 15 minutes into trading, the Dow Jones Industrial Average stood at 28,571.29, up 0.2 per cent.

Also, Asian equities rose on Thursday in subdued trading, holding the gains recently spurred by the US-China trade thaw.

Following the Christmas lull, investors were waiting, in particular, for US unemployment data that was due later in the day, and Japanese industrial and retail data that was scheduled for release on Friday.

Tokyo's benchmark Nikkei index closed 0.6 per cent higher after a flat start. Shanghai put on 0.9 per cent, while Seoul was up 0.4 per cent. Singapore, however, was down 0.3 per cent.

"Investor sentiment towards the global economy is improving," said Rakuten Securities Chief Strategist Masayuki Kubota.

Hong Kong, Sydney and Wellington were closed for a public holiday.

"With the... tech sector giants leading the way, investors are showing no fear as the market remains underpinned by the thawing in the US-China trade squabble and easy central bank policy," Stephen Innes, chief Asia market strategist at AxiTrader, said in a report.

Volumes are typically light during the holiday season, and the muted activity in Asia followed sleepy Christmas Eve sessions in many world markets.

"No news being good news, Asia should maintain... gains ahead of a US session likely to be positive," Jeffrey Halley, senior market analyst for Asia-Pacific at OANDA, wrote in a note earlier in the day.

In oil markets, the main contracts traded higher as the commodity remained strong thanks to trade optimism as well as the OPEC+ output reduction agreement.

Brent Crude and West Texas Intermediate were both up 0.2 per cent.

"Oil prices continue to show year-end strength supported by a combination of definitive progress on the US-China trade deal, the... OPEC/OPEC+ agreement, and slowing shale activity," wrote AxiTrader's Innes.

"All of which is pointing to a stronger performance for oil prices in Q1 than anyone had thought only two months ago."

World markets were spooked by the long-running, tit-for-tat trade war between the United States and China, with analysts warning that the bruising rift between the world's two biggest economies could harm global economic growth.

Washington and Beijing have agreed to an initial trade deal, which they are expected to finalise in January, and the improvement in ties has boosted markets with investors hoping for a smoother ride into the new year.

Uber says co-founder Travis Kalanick to leave company’s board

By - Dec 26,2019 - Last updated at Dec 26,2019

NEW YORK — One of the founders of dominant ride-hailing service Uber, Travis Kalanick, will exit the company at the end of the year, the company said on Tuesday.

Kalanick, who was pushed out as chief executive in 2017 over various controversies, will sever his final ties to the company, resigning from the board of directors effective December 31 "to focus on his new business and philanthropic endeavors", Uber said in a statement.

"Uber has been a part of my life for the past 10 years. At the close of the decade, and with the company now public, it seems like the right moment for me to focus on my current business and philanthropic pursuits," Kalanick said.

In March 2018, Kalanick announced the creation of a new investment vehicle, 10100, that will focus on both for-profit and non-profit ventures. The key areas of focus for the fund include real estate, e-commerce and innovation in China and India.

Kalanick and fellow Uber co-founder Garrett Camp got the idea for Uber while visiting Paris in December 2008 when they were unable to find a taxi.

UberCab launched in July 2010 in San Francisco. The company name was shortened in October to Uber.

Board Chairperson Ron Sugar thanked Kalanick for "his unique expertise, honed over 10 years building Uber from a scrappy startup into the global public company".

Kalanick resigned from Uber in June 2017 amid heavy pressure following a series of disturbing reports about a cutthroat workplace culture, harassment, discrimination and questionable business tactics to thwart rivals.

Uber shares have fallen more than 25 per cent since the company went public in May amid questions over its long-term profitability prospects.

Shares rose 1.1 per cent to $30.67 in morning trading on Tuesday. 

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