Business

AMMAN — Royal Jordanian (RJ) and the General Union for Air Transport on Monday signed a collective agreement giving RJ staff the choice to obtain a voluntary release from the job between the period February 1 and March 31, 2018 subject to the airline’s approval. 

RJ’s President Stefan Pichler and the head of the General Union for Air Transport and Tourism Yousef Qannab signed the agreement, according to a statement received by The Jordan Times on Wednesday.

Under the agreement, employees have the option to submit a request to be released from service, and subject to Royal Jordanian’s approval, they are given a half-month salary for each year of service, said the statement. 

Pichler said this agreement comes in line with the turnaround plan RJ is currently implementing to achieve sustainable profitability. One of the main pillars of the plan requires that RJ reduces manpower, he said, underlining RJ's and the union's keenness to ensure the sustainable profitability of the national carrier and its role in serving the country, and achieving the airline’s strategic goals. 

Qannab asserted that the union is committed to protecting employees’ rights, by ensuring that they receive compensation that supports them and their families after the end of their service. 

He also expressed the union’s appreciation of the employees’ efforts in all departments, according to the statement. 

STOCKHOLM — Swedish truck maker Volvo said Wednesday that its net profit sped ahead by 60 per cent in 2017, as strong global demand for heavy goods vehicles drove up sales to a new record. 

Investors cheered the latest earnings numbers, with Volvo's share price showing a gain of 1.2 per cent on the Stockholm stock exchange in early afternoon, while the rest of the market was flat.

Volvo said in a statement that its net profit soared to 21 billion kronor (2 billion euros, $2.67 billion) for the full year, as sales jumped by 11 per cent to 334 billion kronor.

Operating income rose by 46 per cent to 30.3 billion.

"In 2017 the Volvo Group achieved its highest sales and operating income in history," said Chief Executive Martin Lundstedt. 

"We also improved our profitability with an operating margin of 9.1 per cent, compared to 6.9 per cent in 2016, “he added.

Sales rose on all continents and in all business areas.

For Volvo Trucks, sales increased by 8 per cent, while the construction equipment unit saw a 31-per cent jump. Volvo Penta posted a 12.4-per cent rise, and Volvo Buses an increase of 3 per cent.

All units also registered their highest operating income ever, Volvo said.

The company also raised its truck sales outlook for 2018 for the European, North American, Brazilian and Indian markets. For the construction equipment unit, it raised its forecast for Europe, North America and China.

Volvo's board of directors has proposed a dividend of 4.25 kronor per share in 2018, up from 3.25 kronor a year ago.

Earlier this month, Volvo Trucks also announced it would begin selling electric trucks in 2019.

MARRAKESH, Morocco — International Monetary Fund (IMF) Managing Director Christine Lagarde warned on Tuesday that "public dissatisfaction is bubbling up" in the Middle East and North Africa, calling for reforms that "respond faster to the expectations and sometimes to the frustration of the people".

Speaking at a conference in Morocco's Marrakesh, the head of the IMF called for "inclusive, sustainable growth" and urged delegates to consider "how do we scale up the reform so it provides for the people?"

The two-day "Opportunities for All" conference brought together senior political and business leaders, young people and representatives of civil society from Arab countries, many of them rocked by economic instability since the 2011 Arab Spring uprisings.

The gathering focused on fighting corruption, boosting the private sector and creating jobs.

Moroccan Prime Minister Saad Eddine El Othmani spoke of "social pressure, expectations, aspirations and pressures from the population", calling for emergency programmes.

"The population has expectations for immediate solutions, needs that must be met immediately," he added.

Morocco has in recent months seen mass protests linked to perceived neglect of its northern Rif region and the northeastern former mining town of Jerada.

An official report published in October revealed persistent poverty in rural areas.

Following revolts born largely out of economic hardship and discontent among the young, IMF-backed reforms have proved a delicate balancing act elsewhere in the region.

To benefit from IMF loans, countries such as Tunisia, Egypt and Jordan have had to reduce their budget deficits, resulting in cost of living rises for their citizens.

An austerity budget in Tunisia, along with increases in value-added taxes, sent demonstrators out onto the streets in early January.

Speaking at the Marrakesh conference, Tunisia's Prime Minister Youssef Chahed criticised "policies... that only take into account gross domestic product, while citizens measure development by their standard of living".

"There is often a focus on financial and monetary stability, to the detriment of the social dimension," he said, welcoming a recent IMF initiative to diversify the indicators it uses to evaluate economic policies.

He said Tunisia's post-uprising transition had made the country "freer", but generated instability that had deterred investment.

Lagarde said promoting sustained growth in the region requires a "vibrant" private sector, fighting corruption and developing more equitable tax regimes, as well as supporting "excluded groups" including the youth, women and refugees.

As a region, the Middle East and North Africa has one of the lowest employment rates in the world, partly because of low women's participation in the workforce, according to a recent IMF report.

NEW DELHI — India said on Monday it expects economic growth to rise to between 7 and 7.5 per cent in the next fiscal year as the negative impact of two controversial reforms diminishes. 

The economy is expected to grow 6.75 per cent this fiscal year on the back of a recovery in the second half, the government said in its economic report released before the annual budget.

Growth has been hit by the introduction of a new national goods and services tax (GST) last year and by a controversial 2016 move to withdraw all high-value banknotes from circulation.

The economy has also been helped by a rise in exports, the government's chief economic adviser Arvind Subramanian told reporters. 

"Growth is picking up because the temporary impact of demonetisation and GST have dissipated, corrective actions have been taken and the government is injecting a fair amount of demand," he said. 

"The direction is very good. The level is still below potential. But in terms of directionality, the economy seems to be picking up quite nicely, quite robustly," Subramanian said. 

Prime Minister Narendra Modi swept to power in 2014 on a promise to attract foreign investment and create jobs for a burgeoning youth population.

In its report, the government said creating employment for young people would remain a key priority before a general election that must be held by May next year. 

It also expressed concern about falling rural incomes, saying climate change was having an adverse impact on farm yields. 

"Climate change could reduce annual agricultural incomes in the range of 15 per cent to 18 per cent on average, and up to 20 per cent to 25 per cent for unirrigated areas in India," it said.

Less than half of India's farmland is irrigated, with the rest reliant on rainfall.

TOKYO — Tokyo-based cryptocurrency exchange Coincheck Inc. on Sunday said it would return about 46.3 billion yen ($425 million) of the virtual money it lost to hackers two days ago in one of the biggest-ever thefts of digital money.

That amounts to nearly 90 per cent of the 58 billion yen worth of NEM coins the company lost in an attack that forced it to suspend on Friday withdrawals of all cryptocurrencies except bitcoin.

In a statement, Coincheck said it would repay the roughly 260,000 owners of NEM coins in Japanese yen, although it was still working on timing and method.

The theft underscores security and regulatory concerns about bitcoin and other virtual currencies even as a global boom in them shows little signs of fizzling.

Two sources with direct knowledge of the matter said Japan's Financial Services Agency sent a notice to the country's roughly 30 firms that operate virtual currency exchanges to warn of further possible cyberattacks, urging them to step up security. 

The financial watchdog is also considering administrative punishment for Coincheck under the financial settlements law, one of the sources said.

Japan started to require cryptocurrency exchange operators to register with the government only in April 2017. Pre-existing operators such as Coincheck have been allowed to continue offering services while awaiting approval. Coincheck's application, submitted in September, is still pending.

Coincheck told a late-Friday news conference that its NEM coins were stored in a "hot wallet" instead of the more secure "cold wallet", outside the internet. Asked why, company President Koichiro Wada cited technical difficulties and a shortage of staff capable of dealing with them.

In 2014, Tokyo-based Mt. Gox, which once handled 80 per cent of the world's bitcoin trades, filed for bankruptcy after losing around half a billion dollars worth of bitcoins. More recently, South Korean cryptocurrency exchange Youbit last month shut down and filed for bankruptcy after being hacked twice last year.

World leaders meeting in Davos last week issued fresh warnings about the dangers of cryptocurrencies, with US Treasury Secretary Steven Mnuchin relating Washington's concern about the money being used for illicit activity. 

AMMAN — Citi recently appointed Nour Ghazi Jarrar as the chief executive officer (CEO) for Citibank N.A. Jordan, according to a statement received by The Jordan Times.

She joins Citibank from Bank ABC in Jordan where she was most recently head of wholesale banking group. 

Jarrar is a seasoned banker with substantial banking and financial experience, according to the statement.  

Commenting on her new role, she said: “I am delighted to lead the Citi Franchise in Jordan. Together with the Citi team, we will continue to provide the highest standards of banking service to our clients and fulfill our role as an active member of the Jordanian banking community.”

“We are proud of our heritage and the strength of our relationship with all local stakeholders,” said Nadir Shaikh, Citibank N.A, CEO for Egypt and Levant region.

“Nour’s diverse experience, in-depth knowledge of the local market will help us take our Jordanian franchise to the next level.”

NEW YORK, Jan 26 — Strong earnings from Intel and other companies drove Wall Street indexes to record closing highs on Friday, while the US dollar remained weak after recent comments by the US Treasury secretary.

The S&P 500 jumped 1.2 per cent, its biggest daily percentage gain since March 1. The S&P and the two other main indexes all notched their best four-week runs since 2016.

Stocks around the globe also rose. The MSCI world equity index, which tracks shares in 47 countries, climbed for a 10th straight week, its longest weekly winning streak since 1999.

Shares of Intel Corp. jumped more than 10 per cent and hit their highest level since October 2000 a day after the company reported quarterly results. 

The results of Intel and some other companies helped investors shrug off weaker-than-expected US economic growth data. Fourth-quarter gross domestic product increased at a 2.6 per cent annual rate, the Commerce Department reported.

Shares of drugmaker AbbVie Inc. also climbed 10 per cent after the company significantly boosted its 2018 earnings forecast and said it hopes to accelerate dividend growth and share buybacks.

"We continue to see these positive steps in the right direction and definitely earnings are clearly justifying a lot of the recent move that we've had," said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina.

Fourth-quarter earnings growth for the S&P 500 is now estimated at 13.2 per cent, according to Thomson Reuters data, up from 12 per cent at the start of the year. 

Also helping equities, the US dollar remained weak against a basket of major currencies, still bruised by comments earlier this week by US Treasury Secretary Steven Mnuchin in support of a weak dollar and following Friday's US growth data.

President Donald Trump's comments on Thursday in favour of a "strong dollar," a day after Mnuchin said a weaker greenback would help US trade balances in the short term, failed to keep dollar bears in check.

The dollar index, which measures the greenback against a basket of six major currencies, was down 0.33 per cent at 89.1 and on track for a weekly fall of 1.6 per cent.

The Dow Jones Industrial Average rose 223.92 points, or 0.85 per cent, to 26,616.71, the S&P 500 gained 33.62 points, or 1.18 per cent, to 2,872.87, and the Nasdaq Composite added 94.61 points, or 1.28 per cent, to 7,505.77.

The pan-European FTSEurofirst 300 index rose 0.54 per cent, and MSCI's gauge of stocks across the globe gained 0.67 per cent. For the week, the MSCI index was up 2 per cent.

In a weekly note on capital flows, Bank of America Merrill Lynch analysts said that 98 per cent of global equity markets are now trading above 50- and 200-day moving averages, though the pace of the melt-up meant a correction was increasingly likely.

World equity markets have rallied over the past year, buoyed by a synchronised uptick in global economic growth in a boon to corporate profits and stock valuations.

US Treasury yields climbed after the US GDP data and after the governor of the Bank of Japan said inflation is finally close to reaching the central bank's 2 per cent target.

Benchmark 10-year notes last fell 11/32 in price to yield 2.6599 per cent, from 2.621 per cent late on Thursday.

In the energy market, oil prices settled higher, with crude also posting a weekly gain as the weaker dollar underpinned prices.

Brent crude futures settled up 10 cents, or 0.1 per cent, at $70.52 per barrel, while US crude futures closed at $66.14, up 63 cents, or nearly 1 per cent. For the week, Brent posted a nearly 2.7 per cent gain, while US crude was up 4.3 per cent for the week.

Gold also rose with the dollar's decline. Spot gold was up 0.3 per cent at $1,351.86, up 1.5 per cent this week.

LONDON — The euro briefly shot past $1.25 to a three-year high on Thursday, after European Central Bank (ECB) President Mario Draghi said the central bank did not target foreign exchange rates when asked about the strength of the single currency.

An upbeat tone on the economy and the medium-term outlook for inflation helped send bond yields in Germany, the bloc's biggest economy, to their highest level in around six months.

Speaking at a press conference following an ECB meeting, Draghi said that recent currency volatility was a source of uncertainty but he did not express outright unease with the euro's strength. 

The euro surged to $1.2538, its highest level since December 2014, before slipping back to trade at $1.2498, up 0.7 per cent. The single currency was flat before Draghi started speaking. 

With the euro touching a series of 3-year highs in recent days, some traders were expecting Draghi to talk down the single currency, given its rise could squeeze the competitiveness of eurozone exporters down the line and pull down inflation. 

On a trade-weighted basis, the euro's rise is far less marked, however. 

"Euro [has broken] higher on no verbal intervention," said Mizuho's head of hedge fund FX sales, Neil Jones. "We were looking for it but we didn't get it. It appears Mnuchin's comments were more verbal intervention than Draghi's."

Draghi said the ECB might have to review strategy if US comments on a weak dollar lead to a change in monetary conditions.

US Treasury Secretary Steven Mnuchin said on Wednesday that he welcomed the weaker dollar because it was "good for us". His remarks extended the US currency's recent slide.

The euro is now up 4 per cent against the dollar in 2018, and 7.2 per cent over the last six months. 

Europe's single currency also rose as much as 0.4 per cent against sterling after earlier trading flat. 

Bond yields jump

Analysts said that Draghi not talking down the euro, as well as positive comments on the economy, sparked a sell-off in government bonds.

"What is striking is that he's trying his best to push out rate hike expectations but the market appears to be ignoring that," said Kim Liu, senior fixed income strategist at ABN AMRO.

German government bond yields rose to their highest levels in around six months, reversing early falls. The German 10-year Bund yield rose as high as 0.579 per cent and was set for its biggest one-day rise in two weeks.

Two-year bond yields hit minus 0.56 per cent. 

French 10-year bond yields also attained a 6-month high around 0.9270 per cent, while 10-year borrowing costs across the euro area were 2-5 basis points higher on the day. 

Spain's 10-year bond yield was up 5 basis points, set for its biggest daily jump in over a month.

Mizuho rates strategist Antoine Bouvet said the sell-off in bonds was also caused by Draghi's emphasis on the size of the central bank's balance sheet, which was supportive for the economy, rather than its asset purchase flows. 

BRUSSELS — The EU on Wednesday hit US chipmaking giant Qualcomm with an antitrust fine of 997 million euros ($1.2 billion) for paying Apple to use its chips exclusively in iPhones and iPads.

EU Competition Commissioner Margrethe Vestager said that by striking the agreement with Apple in 2011 Qualcomm had "abused its market dominance" to unfairly shut out rivals such as Intel, denying choice to consumers.

The fine is the latest blow struck by the EU against US tech giants and also a fresh hit for Qualcomm, the leading global supplier of smartphone chips, following another antitrust fine of $800 million imposed by authorities in Taiwan last year.

"Qualcomm cemented its position by illegally shutting out rivals from the market for over five years," Vestager told a press conference.

"Between 2011 and 2016 Qualcomm paid billions of US dollars to a key customer, Apple, and the payment was to prevent Apple to buy from rivals", Vestager said.

"This meant that no rival could effectively challenge Qualcomm in this market, no matter how good their products were."

Qualcomm said it would appeal against the ruling.

"We are confident this agreement did not violate EU competition rules or adversely affect market competition or European consumers," Qualcomm's Don Rosenberg said in a statement.

'Choice and innovation' hampered 

The deal involved so-called chipsets that enable smartphones to send and receive voice calls and data over cell networks. 

The Danish commissioner said that Qualcomm had "denied consumers and other companies more choice and innovation".

Vestager said the EU's two-and-a-half year probe uncovered internal Apple documents showing it was "seriously thinking about switching" to Qualcomm's rival Intel on several occasions.

"This would have made a big difference to Intel. Apple is one of the largest makers of smartphones and tablets in the world. In the end Apple decided not to make the change," Vestager said.

The level of the fine, which amounts to 4.9 per cent of Qualcomm's turnover in 2017, "takes account of the duration and gravity of the infringement, and is aimed at deterring market players from engaging in such anti-competitive practices in the future," the commission said.

Qualcomm and Apple are currently entangled in a bitter legal dispute over patents and royalties, though Vestager said she did not expect Wednesday's ruling to have an impact on this.

"This is a well framed matter and it has nothing to do with IP [intellectual property], it has to do with misuse of dominant position and exclusivity payments, so it's a completely different line of thinking," Vestager said.

The iPhone manufacturer filed a US lawsuit in January 2017 accusing Qualcomm of abusing its market power for certain mobile chipsets to demand unfair royalties.

The EU has turned the screw on US tech giants recently, ordering Apple in 2016 to repay 13 billion euros in back taxes to Ireland, and hitting Google with a record 2.4-billion-euro fine in June last year for illegally favouring its shopping service in search results.