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AMMAN — The Jordanian Indian Fertilisers Company (JIFCO) on Monday announced the start of the operational phase at its industrial zone in Shidiyeh, which was established at a cost of $860 million.

The zone includes two factories: one to produce phosphoric acid and the other to manufacture sulfuric acid, in addition to other facilities. 

JIFCO Chairman Amer Majali said the project was funded by the European Investment Bank and an agency affiliated with the International Monetary Fund.

He noted that around 500,000 metric tonnes of phosphoric acid are expected to be produced at the zone and to be exported  to other countries, namely India, with revenues projected to reach $325 million. A total of 300 Jordanians are working at the zone.  

LONDON — Brent crude oil fell on Monday to a five-year low below $68 before recovering most of the losses as investors looked for a price floor after last week's decision by the Organisation of the Petroleum Exporting Countries (OPEC) not to cut production.

US crude and Brent have fallen for five months in a row, oil's longest losing streak since the 2008 financial crisis.

"The market is still very much in panic mode," said Energy Aspects' chief oil analyst Amrita Sen. "Once we get over the panic, Brent prices will probably stabilise at around $65-80 a barrel in the short term."

Brent hit a low of $67.53 a barrel, the lowest since October 2009, and was down 7 cents at $70.07 a barrel by 1347 GMT. US crude was up 19 cents at $66.34 a barrel, having slipped to an intraday low of $63.72, the lowest since July 2009.

Saudi Arabia, OPEC's most influential member blocked moves by some smaller producers to curb oil output in response to huge oversupply in world markets.

Oil lost more than 12 per cent after OPEC's decision last Thursday.

Data suggested the new price environment has hit fast-growing US shale oil production, the main driver of global production growth in recent years, with a 15 per cent drop in permits for new wells in November.

"The market is still looking for a new equilibrium below $70 [a barrel], which is a little surprising given that, with the current prices, much of the shale oil production in the US, or part of it, will be unprofitable," Commerzbank analyst Eugen Weinberg said.

With oil prices down about 40 per cent since June, the impact is being felt around the world as oil producers from Iraq to Nigeria revise 2015 budgets to reflect lower prices.

Slower-than-expected growth in China's manufacturing sector may add further downward pressure on oil. China's official Purchasing Managers' Index (PMI) slipped to 50.3 in November, a government study showed on Monday, lower than analyst forecasts of 50.6.

"In the fourth quarter, oil markets have lost the support of both the invisible hand of the US Fed and OPEC," Petromatrix analyst Olivier Jakob said, referring to the Federal Reserve's move to phase out monetary stimulus for the US economy.

Separately said it was content with the group's's decision to maintain output despite a supply glut and plunging prices.

The council of ministers "expressed satisfaction at the decisions that reflected the cohesion and solidarity of the organisation", the official Saudi Press Agency (SPA) said.

The Cabinet was briefed on last Thursday's meeting of the 12-member OPEC in Vienna, it added.

The group which pumps one-third of global oil decided to keep production at 30 million barrels a day, sending US oil prices down more than $4 in Friday opening trades after the meeting, a selloff that continued when markets reopened on Monday.

OPEC's poorer members including Venezuela had sought a production cut to protect their revenues.

SPA said the Saudi Cabinet highlighted "that the kingdom pays attention to the stability of the international market, and that its policies are based on the short- and long-term economic interests of the kingdom".

It added that "cooperation by OPEC and non-OPEC producers is a joint responsibility" to achieve a stable market.

Analysts had said Riyadh was content to see American shale oil producers — and even some members of the group — suffer from low prices while it tries to hold on to market share in an increasingly competitive business.

Saudi Arabia is economically strong enough to withstand lower prices, the analysts said.

JOHANNESBURG — Barack Obama last year told a cheering crowd in Cape Town that a $7 billion plan to "Power Africa" would double electricity output on the world's poorest continent and bring "light where currently there is darkness".

A year later, the US president's flagship project for Africa has already achieved 25 per cent of its goal to deliver 10,000 megawatts of electricity and bring light to 20 million households and businesses, according to its annual report.

But the five-year plan has not yet delivered the power.

Power Africa has not measured its progress by counting actual megawatts added to the grid but promises of additional power made in deals it says it helped negotiate, according to sources inside the project and documents seen by Reuters.

Some projects facilitated by Power Africa, a programme operated by the US aid agency USAID, were under way years before the scheme's inception, others are still in the planning stage.

It is unclear how much of the $7 billion Obama pledged has actually been spent or if a further $20 billion in private sector investment commitments will materialise.

"Saying you've met targets on projects that might never happen or taking the credit for projects that have been worked on for years makes me uncomfortable," a source working on Power Africa told Reuters. "It's misleading."

Obama's pledge to double power generation in Africa within five years looked highly ambitious from the start. Per capita electricity output in Sub-Saharan Africa has been flat for three decades because most promised power plants never get built.

"We're dealing with megawatts on paper, rather than on the grid," a second source working on the project said. "Is that really what Obama promised?"

The first African-American US president, the son of a Kenyan father, Obama has often been criticised for a lukewarm engagement in Africa, consisting more of words than deeds.

‘We're like a pharmacist’

The 48 countries of Sub-Saharan Africa, with a combined population of 800 million, produce roughly the same amount of power as Spain, a country of just 46 million. This constrains Africa's growth and keeps hundreds of millions in poverty.

Power Africa coordinator Andrew Herscowitz told Reuters there had been some confusion about the role of the programme. He said it was always intended to "expedite transactions", facilitating private investment rather than handing out aid.

Herscowitz said Power Africa was there to help the private sector deliver electricity and it had already negotiated commitments from companies worth $20 billion, although he did not know how much of this money had been spent.

"We're like a pharmacist, where people come to us, we reach out to people and figure out what is needed," he said. "In some projects we may have a lot of involvement and in some we have very little involvement."

Foreign companies sign billions of dollars of agreements with African governments to build infrastructure every year, although a large number never get built.

In April 2011, the US Millennium Challenge Corp., a government aid agency involved in Power Africa, signed a $350 million deal to "revitalise" Malawi's power sector.

More than three years on, 1.7 per cent of that money has been spent, according to the programme's website, which gives no detail on progress on the ground.

Memoranda of understanding Power Africa signed this year with its six focus countries — Tanzania, Nigeria, Kenya, Ethiopia, Liberia and Ghana — contain less than $100 million of financial commitments targeted at specific countries, most of which is for consultants.

US consultancy Tetra Tech won a $64 million contract and former British Prime Minister Tony Blair's Africa Governance Initiative was given a $3 million deal.

As with many African aid projects, rights groups have criticised Power Africa as mostly being a vehicle to subsidise US companies.

Documents show $5 billion out of the $7 billion pledged is for loans for US exports from the government's Export-Import Bank (EXIM) and Overseas Private Investment Corp. (OPIC).

Turn on the lights

"It's absolutely not true. Power Africa is an opportunity to turn on the lights for millions of Africans by taking investment from all over the world," Herscowitz said.

Herscowitz rejected suggestions Power Africa merely tapped into existing projects, highlighting a 5 megawatt "NextGen" solar project in Tanzania and a 30 megawatt biomass scheme in Kenya which he said "didn't exist before Power Africa".

The NextGen project website, however, says a power purchase agreement for the solar project was signed in January 2013, six months before Power Africa was launched.

It is by no means guaranteed that the Power Africa programme, which has an initial five-year mandate, will continue or be seen as a priority when Obama's final term ends in two years, US government sources told Reuters.

In addition, the investment banks EXIM and OPIC are fighting for their survival in Congress, where Obama's Democratic Party was severely weakened in mid-term elections last month.

In a change of tack, the US government said in November it wants to partner with China on improving power in Africa.

Meanwhile, corruption in the countries that Power Africa operates in remains a problem.

Nigeria's state oil company was accused last year by the then central bank governor of withholding $20 billion in oil funds due to the government, while Tanzania's parliament is currently reviewing a report on graft in its energy sector.

AMMAN — A senior South African official on Sunday described Jordan as  an important gate to the Middle East and North Africa.

Zanele Sunni, chief director, and head of the Department of Trade and Industry delegation on South Africa’s trade and investment orientation, told The Jordan Times in an interview that South Africa is keen to bolster economic relations with Jordan through encouraging mutual investments in both countries.

Speaking on the sidelines of the first “South African Trade & Tourism Seminar, Exhibit and B2B Meeting” held in Amman on Sunday, Sunni said the volume of trade between the two countries is still modest and more need to be done to improve it.

Figures she presented showed South African exports to Jordan totaled $27 million in 2013, while imports from the Kingdom during the same year amounted to around $18 million.

Noting that the delegation was the first government mission on an exploratory tour  “because we are doing a Middle East round”, Sunni mentioned pharmaceuticals as a potential Jordanian export that “will be of interest to us, but I think we need to explore lots more”.

She said infrastructure, especially in the economic zones, was a priority for investment in South Africa.

“We have South African investments in the region,  I am sure that there are South Africans who will be interested in looking at that… we would also interested in investing in fast moving consumer goods, but that always depends on investors,” she added.

Speaking in the opening of the one-day forum,  South African ambassador to Jordan Molefe Tsele described South African and Jordanian relations as warm and growing. 

“South Africa is today one of the only two Sub-Saharan countries in Africa, where Jordan has an embassy, the other being Sudan,” Tsele said, adding that the ties between the two countries are a relationship of like-minded friendly countries, who share common political ideals about global and regional peace and stability.

However, he emphasised that bolstering business partnerships is also important in this regard.

“What is needed is to lift up this relationship to a higher platform through increased business partnerships and strategic economic relations,” he said.

The forum was held with the participation of representatives of several South African companies working in the fields of telecom, engineering, petrochemicals, power, water, software development and technology, in addition to representatives of Jordan chamber of commerce and investment commission.

According to Ahmad Zubi, director of studies and policies at the Jordan Investment Commission, Jordan provides both economically and politically stable environment for investment.

He also noted that investing in water efficiency projects is one of the country’s major priorities.

GAZA CITY — Already struggling under the weight of an Israeli blockade, Gazans are now feeling the effects of an Egyptian exclusion zone along their shared border that has sent prices soaring.

After the cost of his cigarettes nearly tripled, 18-year-old Jihad Ahmed now buys just a few at a time instead of a pack and smokes them sparingly.

Imad Shilbaya, who sold them to him, said Egypt's crackdown on cross-border smuggling tunnels was behind the price hike.

"The tunnels from Egypt have been closed, hitting stocks of cigarettes in Gaza hard and sending prices soaring," he told AFP.

Israel first imposed a blockade on Gaza in 2006 after militants there snatched one of its soldiers.

It was tightened significantly a year later when the Islamist movement Hamas seized control of the territory, which is home to 1.8 million people.

But some relief came through a honeycomb of tunnels from Egypt that brought in a wide range of consumer goods, livestock, fuel, as well as arms and money for militant groups.

Smuggling of building materials alone was worth more than one billion euros annually, according to Ayman Abed of the economy ministry in Gaza.

But the Egyptian military, which began a process of shutting down the tunnels after it overthrow Islamist president Mohamed Morsi in July 2013, stepped up its activity significantly in late October after militants in northern Sinai killed some 30 Egyptian soldiers.

Since then, it has been demolishing houses along the border to build a buffer zone in a region that has been rocked by insurgency since Morsi's ouster. 

So far, Egypt has destroyed 1,600 tunnels. In late October it also closed the Rafah border crossing, Gaza's only gateway to the world not controlled by Israel.

"Prices are very high since Egypt completely closed the tunnels," said Abu Mohammed, who owns a small supermarket west of Gaza City, noting hikes in the price of "milk, legumes and even cheese".

"We used to sell Egyptian cheese for 10 or 11 shekels; now it is more than 23 [about $6 or nearly five euros]. I don't sell it anymore. No one buy it at this price," he added.

And Mohammed Safi, who owns an electronics shop, said: "Prices of mobiles are higher since the blockade of tunnels. We can't get them as before. We used to sell iPhone 5s for 2,200 shekels, now the price is 2,600."

'Disastrous situation'

Products entering from Israel are far more expensive than those originating in Egypt, and largely beyond the means of the average Palestinian in the crowded coastal territory, where youth unemployment is running at 63 per cent.

Oxfam says more than 40 per cent of the overall population is jobless and that 80 per cent live on humanitarian aid.

The lack of cement and gravel to feed the construction industry accounts for 35,000 of Gaza's unemployed, Abed of the economy ministry indicated.

During last summer's war with Israel, UN figures show that around 20,000 housing units, or nearly 6 per cent of the housing stock, were severely damaged or destroyed. That resulted in more than 100,000 internally displaced persons.

Tens of thousands of other homes were damaged in the conflict and are still awaiting repairs and renovation. 

But since fighting ended on August 26, only 1,300 tonnes of building materials have crossed into the Strip, Palestinian officials say. 

"That's not enough to put up a single building," according to Gaza builders' merchant Suheil Tuman.

When distributed through the UN agency for Palestinian refugees (UNRWA), a 50 kilogramme sack of cement sells for 5.50 euros. But the price is 42 euros on the black market.

"When the tunnels were open, a tonne of cement sold for 380 shekels [80 euros] on the black market," Tuman indicated. "Today it is 3,800 shekels."

Economist Amr Shaabane said the economic situation "is literally disastrous. It has never been this bad in Gaza".

The reasons? "The blockade, poverty, unemployment, the trickle of goods entering and soaring prices." 

In the past, Gaza prices had always been far lower than in the occupied West Bank and Jerusalem.

"Today, Gaza market stalls offer Israeli goods at a price that is more expensive to begin with and to which heavy taxes are added on their entry to Gaza," the economist added.

AMMAN — Arab Businessmen’s Federation Chairman Hamdi Tabbaa underscored the importance of the 4th India-Arab Partnership Conference, which concluded in New Delhi recently, Tabbaaa stressed the need to deal with the challenges hindering the development of Arab economic relations with India, noting that Arab investments in India are around $125 billion while India’s investments in Arab countries do not exceed $6 billion.

Some 25 garment factories owned by Indians have been established in the Qualifying Industrial Zones in Jordan, with an investment of over $60 million, providing jobs to more than 9,000 employees.

LONDON — European firms squeezed by low interest rates are having to consider new, riskier ways to manage trillions in corporate cash as they are snubbed by banks awash in new regulation that may also spell the demise of their go-to investment funds.

In order to protect and grow their companies' money and ensure it is easily accessible to pay wages, invoices and dividends, treasurers are being forced to look at less secure assets and deal with some of them directly.

"There is a tectonic shift in the cash management landscape," said Alastair Sewell, a managing director at Fitch rating agency. "One option is to take on more risk."

Corporate treasurers have been under pressure since the financial crisis of 2007-09 when the collapse of banks such as Britain's Northern Rock and Lehman Brothers in the United States — and the ensuing panicked withdrawals from money market funds — rattled confidence about where to stash firms' cash.

Determined not to be caught short in the next crisis should banks cut off their funding, company treasurers in the United States, Britain and the eurozone have more than doubled their cash holdings since 2000 to $5.3 trillion.

But now firms find the banks don't want their money.

A side-effect of new financial regulation aimed at making banks safer by forcing them to hold more capital and low-risk assets means lenders now have to classify some large corporate depositors, traditionally more flighty than small retail customers, as high risk.

That also means banks can only invest those corporate funds in very liquid assets that restrict them from making much in the way of commission.

"They won't say no to you, they will just quote you the worst rate they can," said one London-based treasurer.

Some major banks like Commerzbank and BNY Mellon are also charging some of their customers for euro deposits, passing on the cost of a decision by the European Central Bank (ECB) in June to charge banks for overnight deposits, a rule introduced to force banks to go out and lend.

It's another consequence of the record low interest rates that make it difficult for companies to make any return from deposits.

No more money markets?

Money market funds, which provide a deposit-like facility, would normally pick up the slack from the banks but plans to regulate that sector too could ruin its appeal for treasurers.

Europe wants to impose curbs on money market funds that offer investors a fixed price, accounting for around half the 1-trillion-euro industry in the region, because regulators believe they are more prone to investor runs.

Under proposals being considered by the European Parliament, corporate treasurers will no longer be able to buy into so-called constant net asset value (CNAV) funds unless the fund invests most of its assets in lower-yielding government bonds.

If the CNAV proposals are accepted, treasurers could switch to money market funds that offer variable returns but that would require them to track numerous tiny gains and losses and pay tax on any surplus.

Alternatively they may be forced to go back to the banks, negotiating terms for their cash deposits with lenders that have sufficiently strong credit ratings to be able to take them on.

"If the CNAVs are abolished then what we will see is greater concentration of cash with national champion banks and that is not a good thing for systemic risk or for practical operation of liquidity management for companies," said Richard Raeburn, chairman of the European Association of Corporate Treasurers.

From depo to repo to...

Already major companies are getting inventive with their cash. Rather than haggling over deposits, many are striking repurchase agreements — also known as repos — with banks.

From a trickle that started during the financial crisis, there is now a flood of companies switching from "depo to repo" and lending banks short-term money in return for collateral: International clearing house Clearstream has seen a 200 per cent increase in demand for this service this year.

For a large company which already manages foreign exchange exposures and short-term investments, setting up a repo desk could just mean an extra computer screen but for a smaller firm used to simply handing over cash to a bank or money market fund it would be a major investment and change of strategy.

"Some corporate treasurers are going into repos that's great for large companies, a serious alternative. But what about small- and medium-sized enterprises and charities who don't have the necessary technical ability?" said Raeburn.

Other treasurers are depositing money with banks in Asia and the Middle East and are considering investing their excess cash in higher yielding, and riskier, assets such as company bonds.

"We have been... actively considering alternative asset classes," said Stephen Percival, group financial controller and treasurer at British insurer Standard Life. "We now deal with a far broader geographical range of banks." 

Anticipating more money on the move, particularly if CNAVs are restricted, some asset managers are creating new products for investors, including funds that are not rated by the rating agencies and funds that invest in riskier assets to ensure a higher rate of return.

"Money funds are the safe harbour," said Tony Carfang, partner at consultancy Treasury Strategies. "If that goes away you are cutting a lot of treasurers loose, a lot of money loose."

LONDON – Brent crude oil plunged as much as $6.50 a barrel on Thursday, and US crude fell by nearly as much, posting the steepest one-day falls since 2011, after  Organisation of the Petroleum Exporting Countries (OPEC) decided against cutting output despite a huge oversupply in world markets.

Asked whether the oil producer group had decided not to reduce production, Saudi Arabian Oil Minister Ali Al Naimi told reporters: “That is right.”

Oil prices have fallen by more than a third since June as increasing production in North America from shale oil has overwhelmed demand at a time of sluggish global economic growth.

Ministers from OPEC had been discussing at their meeting in Vienna whether to agree a production cut in an attempt to rebalance the global oil market.

Crude prices have been falling all week as traders and analysts scaled back expectations of an OPEC production cut, but the sharp dive after Thursday’s meeting showed the decision was not fully priced in.

Benchmark Brent futures settled at $72.58 a barrel, down $5.17, after hitting a four-year low of $71.25 earlier in the session. The contract was on track for its biggest monthly fall since 2008.

US crude was last down $4.64 at $69.05 a barrel. Prices fell rapidly in early US trade, before stabilising as market activity dropped off towards midday, with many traders away for the US Thanksgiving holiday.

At its lowest point on Thursday, US crude traded at $67.75, nearly $6.00 down on the day, its weakest since May 2010.

The cartel, whose largest producer and exporter is Saudi Arabia, will meet again in June next year, said an OPEC delegate.

Tariq Zahir, analyst at Tyche Capital Advisors in New York, said the slide in US crude could continue below $65 a barrel in coming weeks, a factor that may start to challenge the economics of North American shale oil production.

“I really think we will start getting into a price war,” Zahir said. “I think you would be a little crazy to try to pick a bottom here. I expect to see a bounce but any bounce will be sold into.”

Oil analysts said the OPEC decision left the oil market vulnerable to much bigger falls as abundant supply of high quality; light crude oil floods world markets, much of it from shale oil in North America.

“In the short term, given market skepticism that recent price levels are low enough to substantially slow US output growth, we expect price levels to drop below $70/bbl for Brent and even lower for WTI [US crude],” Barclays analysts said in a note.

VIENNA — Organisation of Petroleum Exporting Countries (OPEC) Gulf oil producers will not propose an output cut on Thursday, reducing the likelihood of joint action by OPEC to prop up prices that have sunk by a third since June and raising the prospect of a global oil price war.

"The GCC reached a consensus," Saudi Arabian Oil Minister Ali Al Naimi told reporters, referring to the Gulf Cooperation Council which includes Saudi Arabia, Kuwait, Qatar and the United Arab Emirates (UAE). "We are very confident that OPEC will have a unified position."

"The power of convincing will prevail tomorrow... I am confident that OPEC is capable of taking a very unified position," Naimi said.

A Gulf OPEC delegate told Reuters the GCC had reached a consensus not to cut oil output. Three OPEC delegates separately told Reuters they believed OPEC was unlikely to cut output when the 12-member organisation meets on Thursday.

The OPEC meeting will be one of its most crucial in recent years, with oil having tumbled to below $78 a barrel due to the US shale boom and slower economic growth in China and Europe.

Cutting output unilaterally would effectively mean for OPEC, which accounts for a third of global oil output, a further loss of market share to North American shale oil producers.

If OPEC decided against cutting and rolled over existing output levels on Thursday, that would effectively mean a price war that the Saudis and other Gulf producers could withstand due to their large foreign-exchange reserves. Other members, such as Venezuela or Iran, would find it much more difficult.

Brent crude was trading down 73 cents at $77.60 a barrel at 1919 GMT.

Naimi said earlier on Wednesday he expected the oil market "to stabilise itself eventually", after talks with non-OPEC member Russia on Tuesday yielded no pledge from Moscow to tackle a global oil glut jointly.

The UAE sided with Naimi, saying oil prices would soon stabilise, while ramping up pressure on non-OPEC nations.

"This is not a crisis that requires us to panic... we have seen [prices] way lower," UAE Oil Minister Suhail Bin Mohammed Al Mazroui told Reuters. "The oversupply came from the evolution of the unconventional oil production... I think everyone needs to play a role in balancing the market, not OPEC unilaterally." 

Iranian Oil Minister Bijan Zangeneh said some OPEC members, although not Iran, were now gearing up for a battle over market share.

"Some OPEC members believe that this is the time where we need to defend market share ... All the experts in the market believe we have oversupply in the market and next year we will have more oversupply," he added.

The group could opt to roll over output levels but stress the importance of better compliance, while also agreeing to hold an extraordinary meeting if prices keep falling, several OPEC watchers have suggested.

Price war

Among OPEC members, Venezuela and Iraq have called for output cuts. OPEC's traditional price hawk Iran said on Wednesday its views were now close to those of Saudi Arabia.

Zangeneh said there was unity inside OPEC to "monitor the market carefully" but made no mention of a cut.

"The onslaught of North American shale oil has drastically undermined OPEC's position and reduced its market share," said Gary Ross, chief executive of PIRA Energy Group.

Russia, which produces 10.5 million barrels per day (bpd) or 11 per cent of global oil, came to Tuesday's meeting amid hints it might agree to cut output as it suffers from oil's price fall and Western sanctions over Moscow's actions in Ukraine.

But as that meeting with Naimi and officials from Venezuela and non-OPEC member Mexico ended, Russia's most influential oil official, state firm Rosneft's head Igor Sechin, emerged with a surprise message — Russia will not reduce output even if oil falls to $60 per barrel.

Sechin said he expected low oil prices to do more damage to producing nations with higher costs, in a clear reference to the US shale boom. On Wednesday, Russian Energy Minister Alexander Novak said he expected the country's output to be flat next year.

Many at OPEC were surprised by Sechin's suggestion that Russia — in desperate need of oil prices above $100 per barrel to balance its budget — was ready for a price war.

"Gulf states are less bothered about a price drop compared to other OPEC members," an OPEC source close to Gulf thinking said.

OPEC publications have shown that global supply will exceed demand by more than 1 million bpd in the first half of next year.

While the statistics speak in favour of a cut, the buildup to the OPEC meeting has seen one of the most heated debates in years about the next policy step for the group.

"The idea of unleashing a price war against US shale oil seems strange to me. I doubt you can win this battle as most US oil producers are hedging a lot of their output," said a top oil executive visiting Vienna for talks with OPEC ministers.

AMMAN — The implementation rate of the JD55 million Aqaba liquefied gas terminal is around 65 per cent, Aqaba Development Corporation Chief Executive Officer  Ghassan Ghanem said Wednesday, noting  that the terminal will enable Jordan to diversify energy sources in terms of type and geographical destination.