Business

DUBAI  — Gaza, Lebanon and Sudan will take decades to recover from the conflicts raging on their soil, the International Monetary Fund said on Thursday after downgrading the region's growth forecast.

Israel's military actions against Hamas in the Gaza Strip and Hezbollah in Lebanon, and Sudan's civil war would have enduring impacts, the IMF said.

"The damage caused by these conflicts will leave lasting scars at their epicentres for decades," the global lender said in a statement.

The IMF has lowered its predicted growth for the Middle East and Central Asia to 2.1 per cent for 2024, a drop of 0.6 percent due to the wars and lower oil production.

Depending on the conflicts, growth should rise to 4.0 percent next year, according to the IMF's Regional Economic Outlook which was compiled in September.

"This year has been challenging with conflicts causing devastating human suffering and lasting economic damage," Jihad Azour, the IMF's Middle East and Central Asia Department director, told reporters in Dubai.

"The recent escalation in Lebanon has greatly increased the uncertainty in the whole MENA region."

IMF forecasts for Lebanon, where conflict with Israel has sharply escalated this month, have been suspended. But "conservative" estimates show a 9.0-10 per cent contraction this year, Azour said.

"The impact [on Lebanon] will be severe and it will depend how long this conflict will last," said the former Lebanese finance minister.

Saudi-led oil cuts through the OPEC+ cartel, aimed at propping up prices, "are contributing to sluggish near-term growth in many economies", the IMF said.

For the region's oil exporters, "medium-term growth is projected to moderate, as economic diversification reforms will take time to yield results", it added.

Downside risks continue to dominate, the lender said, including fluctuating commodity prices, conflicts and climate shocks.

AMMAN — The Arab Potash Company announced on Wednesday that it achieved a net profit of JD153 million by the end of the third quarter of 2024, after accounting for income tax, provisions, and mining fees, reflecting the company’s strong performance amid increasing global economic challenges and political fluctuations.

Financial data showed that the net sales revenues achieved by "Potash" and its subsidiaries reached approximately JD509 million by the end of the third quarter, while pre-tax profits amounted to JD212 million, highlighting the company’s efficiency in maintaining its position in the global fertiliser market, the Jordan News Agency, Petra, reported. 

The company's investments in affiliated companies contributed to profit growth, with "Potash’s" share of earnings from these investments reaching about JD26 million by the end of the third quarter.

Company's Chairman of the Board Shihadeh Abu Hudaib emphasised that the company, through implementing a flexible strategy focused on expense control and enhancing operational efficiency, overcame challenges posed by geopolitical events and the Red Sea crisis affecting supply chains and global trade.

He noted that the company and its subsidiaries and affiliates contributed approximately $996 million to Jordan's foreign currency reserves during the first nine months of 2024, strengthening its position as a supportive partner for the national economy.

Abu Hudaib praised the government’s efforts in creating a favorable investment environment for the fertiliser and chemical sectors through the enforcement of laws regulating investment in the Kingdom.

He added that potash production reached a record level of approximately 2.2 million tons by the end of the third quarter, and the company succeeded in selling its entire production by the end of September. 

He pointed out that the company managed to reduce the production cost per ton by 5 per cent compared to the same period last year by implementing innovative strategies and improving production efficiency, which are part of the company’s efforts to boost its competitiveness in the global market.

LONDON — Global stock markets diverged on Tuesday as many investors sat on their hands ahead of a slew of US economic data releases and tech earnings, and as bond yields rose.

In  midday  trading in New York, the Dow was lower, the wider S&P little changed, and the techheavy Nasdaq higher. Shares closed mostly lower in Europe. Alphabet   reports earnings after the market closes and many investors are awaiting to hear what the Google parent has to say before taking any bets.

"When a megacap stock reports earnings, the stock market pays extra attention not only to the report itself, but also to any guidance," said  Patrick  O'Hare, an analyst at Briefing.com.

In total, five of the "Magnificent  Seven" US tech giants will report over the next three days, including Amazon, Apple, Facebook-parent Meta and Microsoft.

On  the  economic front, the US government will release third quarter GDP growth estimate Wednesday, as well as inflation data on Thursday and the closely watched monthly labour market report Friday.

Together, they should provide  more  clues about the health of the world's largest economy and the direction of the Federal Reserve's interest rate policy.

Meanwhile, yields on 10-year US Treasuries have inched up to above 4.3 per cent this week, the highest since early July, indicating that some market participants are increasingly counting on more limited rate cuts from the Federal Reserve.

The  higher  rates, which hurt company earnings and deter investors  from  taking money out of savings accounts to invest in the stock market, could also  reflect  unease about the deficit spending plans of both candidates in next Tuesday's presidential elections, said Joe Mazzola, a strategist at Charles Schwab.

"The relentless climb in Treasury yields continues and threatens to overshadow any news, good or bad, on the earnings front," he said. Boeing was up almost 2 per cent after reporting that its stock  offering  was oversubscribed.

The London, Paris and Frankfurt stock markets all closed lower Tuesday while Asian markets ended mixed.

London shed 0.8 per cent as investors awaited the first budget of Britain's new Labour government on Wednesday, expected to include tax rises on businesses.

Adidas shares were up almost 4 per cent in Frankfurt after the sportswear giant again raised its full-year revenue outlook.

Oil prices initially recovered some of Monday's losses after the US government said it would add to its Strategic Petroleum Reserve, but then resumed their recent slide on expectations of a coming oversupply.

Bitcoin rose above $72,000 to levels last seen in June and close to its record highs on expectations that Donald Trump, who has sought the support of the cryptocurrency world, will win next week's elections.

"Trump's  campaign appears to be building upside momentum, and that's going down well with the crypto bros," said David Morrison, analyst at Trade Nation. In Asia, Tokyo and Hong  Kong  stocks climbed but Shanghai and Singapore retreated.

Investors are awaiting the Bank of Japan's rate decision later this week, with the central bank expected to stand pat following two hikes earlier this year.

AMMAN — Jordan Phosphate Mines Company achieved a total profit before tax of JD490.4 million, and a net profit after tax of 316.6 million by the end of the third quarter of this year, the Jordan News Agency, Petra, reported 

During the third quarter of this year alone, the company achieved a total profit before tax of about JD182 million, and a net profit after tax of 114.7 million, an increase of nearly 4 per cent compared to the third quarter of last year.

The consolidated data showed that the group's net sales by the end of the third quarter of this year amounted to JD857.8 million.

AMMAN — The trade balance between Jordan and Qatar grew by 6.1 per cent by the end of the third quarter of 2024 compared to the same period in 2023.

According to recent statistical data from the Qatar Planning and Statistics Authority, the volume of trade exchanges between Jordan and Qatar during the first nine months of 2024 reached approximately $189.5 million, up from $178.5 million in 2023 and $ 164.8 million during the same period in 2022.

Jordan's exports to Qatar include a variety of consumer and food products such as fresh and processed food, vegetables and fruits, meats, dates, dairy products, poultry and derivatives, grains, sweets and cakes, rice, juices, nuts, oils and ghee, pickles, herbs, honey, frozen birds, eggs, and Jordanian coffee.

Qatar’s exports to the Jordanian market consist of various chemical products, including motor oils, sulfonic acid, lutrine, aluminum molds, paraffin, polyethylene, iron rods, various types of chemical fertilisers, plastic bags, engine oils, organic fertiliser, and medical solutions.

The trade balance between Jordan and Qatar has witnessed significant and rapid growth in recent years, driven by a continuous increase in Qatar's imports of Jordanian food and consumer products, which have surged notably over the past two years.

MOSCOW — Russia's central bank hiked interest rates to 21 per cent recently, taking borrowing costs to their highest level in more than two decades as Moscow's Ukraine offensive has triggered rapid price rises at home.

The increase takes rates above an emergency level introduced in February 2022 — just after Moscow ordered troops into Ukraine — to their highest since 2003, with the regulator battling to stem the economic fallout of the conflict.

But despite the high inflation and Western hopes sanctions would cripple the Russian economy, the Kremlin is set to ramp up military spending yet again next year and analysts say Moscow has enough money to keep fighting in Ukraine for the foreseeable future.

Governor Elvira Nabiullina said the pace of price rises — running at an annual rate of 8.6 per cent in September — was not slowing and that further rate rises may be necessary.

"Firstly, inflation. In general, we do not see any signs of it slowing down," she told reporters in Moscow.

"To contain accelerating price growth, we will need much tighter monetary policy over the next year," she added.

Without mentioning the Ukraine offensive, the bank directly blamed high government spending for pushing inflation higher.

"Additional fiscal spending and the related expansion of the federal budget deficit in 2024 have pro-inflationary effects," it said in a statement announcing the rate rise.

The bank also said it would not be able to bring inflation back to its 4 per cent target until at least 2026.

Stubborn inflation, a volatile currency and historically high borrowing costs over the last two years have not deterred the Kremlin from ramping up spending on the military campaign.

Russia has more than $300 billion in reserves that have not been frozen by the West, a low debt-to-GDP ratio of around 15 per cent and is pushing through major tax rises next year to help cover a deficit.

Lawmakers voted on Thursday to increase military expenditure by almost 30 per cent to around $145 billion in 2025.

Combined spending on defence and security is set to account for 40 per cent of Russia's total budget.

The spending boom has powered the economy, with the International Monetary Fund this week raising its growth forecast for Russia in 2024 to 3.6 per cent.

But it has also triggered domestic headwinds.

Hundreds of thousands of men have been called up to fight, fled the country or been recruited by the booming domestic arms industry — leading to a cycle of spiralling wages and prices that the central bank has warned undermines stability.

Nabiullina acknowledged Friday that higher interest rates were having a less "pronounced" impact in cooling the "overheating" economy, in part due to the government's spending boom.

The Kremlin tasks the central bank with managing the domestic fallout of the Ukraine offensive, and permits it a degree of operational independence.

Nabiullina, a former Putin aide who is highly respected in Moscow and had won plaudits in the West before the conflict, has softly criticised the government's economic policies, while being cautious not to comment on the offensive itself.

Russia's official borrowing costs have not been above 20 per cent since 2003.

They regularly topped 100 per cent throughout the 1990s, a decade of economic volatility and hardship following the collapse of the Soviet Union.

The first years of President Vladimir Putin's rule in the 2000s saw an oil-led boom and rising wealth.

But his conflict in Ukraine has threatened Moscow's future prosperity, cutting it off from lucrative Western export markets and much of the global financial system.

Putin had hoped to advance plans for alternative international payment systems at the BRICS summit in Kazan this week, the largest diplomatic gathering in Russia since the start of the offensive.

But speaking at the summit Thursday, he indicated international payments were one of the "key problems" Russia faced and said the group was not creating an alternative to the Belgium-based SWIFT financial messaging system.

The exclusion of some Russian banks from SWIFT due to Western sanctions has made it difficult for Russia to conduct trade.