Business

GENEVA — Pakistan's prime minister on Monday asked the IMF for a pause in its demands for economic reforms before releasing more financial aid, as the country tries to rebuild after catastrophic floods.

Shehbaz Sharif said he was trying to persuade the International Monetary Fund (IMF) to give Islamabad some breathing space as it tackles the "nightmarish" situation.

The global lender wants Pakistan to withdraw remaining subsidies on petroleum products and electricity, aimed at helping the masses.

At the United Nations in Geneva for a conference on Pakistan's recovery from last year's catastrophic monsoon floods, Shehbaz was asked by reporters about the block on IMF funds.

Pakistan's economy has crumbled alongside a simmering political crisis, with the rupee plummeting and inflation at decades-high levels, but the floods and the global energy crisis have piled on further pressure.

Shehbaz came to office in April last year, ahead of the floods in July and August.

A $6 billion IMF deal negotiated by the previous government was restarted after Pakistan finally met conditions such as ending subsidies on fuel.

But Islamabad has so far only received half the funds — the last payment in August — with a further review of the package ongoing.

"Even before these floods hit Pakistan, we were already facing humongous challenges," he said.

"Yet we had to again connect with the IMF and resurrect an agreement which was violated by the previous government — and accept even harsher conditionalities," said Shehbaz.

He said Pakistan was complying with the IMF's conditions "as best as possible" but asked "how on Earth" the additional burdens could be shouldered by the country's poorest.

"Yet we are committed to IMF's programme. We will do everything to comply with the terms and conditions. Though I am constantly trying to persuade them: Please give us a pause," he said.

'Be considerate' 

Shehbaz spoke with IMF Managing Director Kristalina Georgieva on Saturday and asked her to "kindly be considerate and compassionate and give us some breathing space", he said.

"This is an ongoing dialogue. I'm sure one day soon we will be able to convince them through logic and through facts."

"That said, regardless, we will comply with the IMF programme."

Finance Minister Ishaq Dar is due to meet an IMF delegation in Geneva on Monday, a Pakistani minister confirmed to AFP on condition of anonymity.

Economists and traders estimate the country has around three weeks of foreign exchange reserves left to service imports and a swift IMF cash injection is the only way to shore up the economy.

At the Geneva conference, Britain encouraged Pakistan to continue its macroeconomic reforms and conclude the ninth review of the IMF programme.

Development Minister Andrew Mitchell said it would be much easier for the world to help Pakistan "if Pakistani taxpayers are seen to be playing a core part in this effort".

MUMBAI — India's largest software exporter Tata Consultancy Services on Monday reported higher earnings in the December quarter, but missed expectations and warned of a "cautious" business environment in the new year.

TCS is India's second-most-valuable company by market capitalisation and earns more than 80 per cent of its revenues from Western markets.

It has been at the forefront of an IT boom that has seen India become a back office to the world as firms in North America and Europe subcontract work, taking advantage of a skilled English-speaking workforce.

More recently, technology companies have benefited from a boost in demand for digital services since the pandemic.

But fears of an impending recession in key Western markets have hit business sentiment in recent months as software clients turn cautious, the company said.

"Europe is a market where client decision-making is getting impacted by the ongoing geopolitical challenges there and requires close watching," Chief Executive Officer Rajesh Gopinathan told a media briefing.

Gopinathan added that North America, which contributes half of its business, remained "vibrant" even as clients are expected to remain "cautious" and watchful of inflation in the early part of the year.

Net profit at the IT giant rose to 108.46 billion rupees ($1.3 billion) in the three months ended December 31, 11 per cent higher than in the same period last year.

Sustained demand across business segments pushed revenue from operations 19 per cent higher year-on-year to 582.29 billion rupees, crossing $7 billion for the first time in any quarter.

The revenue figures beat expectations but profits missed slightly, media reports said.

The Mumbai-headquartered company said the value of its order book declined to $7.8 billion at the end of December, compared to $8.1 billion at the end of September, albeit within the $7-9 billion guidance range.

The company, one of India's largest private employers, saw its employee headcount fall in the quarter as it continued to slow hiring.

Employee attrition — a key metric for the industry — fell to 21.3 per cent, compared to 21.5 per cent in the previous quarter.

Operating margins rose 0.5 percentage points compared to the September quarter to 24.5 per cent, but contracted 0.5 percentage points year-on-year.

The company's board approved an interim dividend of 8 rupees per share and a special dividend of 67 rupees per share.

Shares in the firm closed 3.35 per cent higher in Mumbai ahead of the results announcement.

DOHA — Qatar signed a $6 billion deal with Chevron Phillips Chemical on Sunday to build a plant including the biggest ethane cracker in the Middle East, converting natural gas into polyethylene and other plastics.

The Ras Laffan Petrochemicals Complex, which will produce 2.1 million tonnes of ethylene a year along with 1.7 million tonnes of polyethylene derivatives, will come on stream in 2026.

The complex will have "lower waste and greenhouse gas emissions" than similar facilities around the world, said Saad Sherida Al Kaabi, Qatar's energy minister and the CEO of QatarEnergy.

QatarEnergy has a 70 per cent equity share in the joint venture with Texas-based Chevron Phillips taking the other 30 per cent.

"This marks QatarEnergy's largest investment ever in Qatar's petrochemicals sector and the first direct investment in 12 years," Kaabi said at a signing ceremony in Doha.

Ras Laffan will double Qatar's ethylene production capacity and increase its polymer output from 2.6 million tonnes to more than 4 million tonnes a year. Overall, Qatar's petrochemical production capacity will rise to almost 14 million tonnes a year.

The investment "marks an important milestone in QatarEnergy's downstream expansion strategy", Kaabi said.

"It will not only facilitate further expansion in the downstream and petrochemical sectors in Qatar, but will also reinforce our integrated position as a major global player in the upstream, LNG and downstream sectors."

Ethane crackers, which convert gas into ethylene, have been targeted by environmental activists for their emissions, while ethylene and polyethylene are used in a swathe of plastic products from piping to water bottles and food packaging.

Wealthy Qatar has large reserves of natural gas including the North Field, which contains the world's biggest deposits and stretches under the Gulf sea into Iranian territory.

AMMAN — Mining sector revenues in 2021 amounted to JD3.11 billion, with extractive industries revenue comprising JD1.94 and manufacturing industries revenues comprising JD1.16 billion, according to the Ministry of Energy and Mineral Resources, the Jordan News Agency, Petra, reported. 

The data indicated that the mining sector contributed 9.12 per cent of Jordan’s GDP. Mining sector exports accounted for 30.4 per cent of total national exports in 2021.

Since the beginning of 2022, the ministry signed seven memoranda of understanding in an effort to put Jordan on the regional and even global mining map.

According to previous statements from Energy Minister Saleh Kharabsheh, the memoranda of understanding were signed to restore momentum to the mining sector.

The ministry also launched an interactive map for marketing mineral resources as well as oil and gas exploration, as part of efforts to achieve the optimal exploitation of natural resources.

The 2025 mineral resources strategy seeks to raise the mining sector’s contribution to GDP to 11 per cent. 

Mining industries witnessed significant improvement at the Arab and international levels, especially in mining phosphates, potash, bromine, chemical acids and fertilisers.

Similarly, extractive industries play an important role in promoting economic independence, as raw materials necessary for a number of manufacturing industries can be mined domestically, thus reducing reliance on imports and positively affecting GDP.

SEOUL — Samsung Electronics said Friday it expected its fourth-quarter operating profits to plunge 69 per cent to an eight-year low as the global downturn hammers demand for memory chips and smartphones.

The South Korean tech giant said operating profits for the October-December period had likely slumped to 4.3 trillion won ($3.4 billion), a stinging year-on-year drop from 13.87 trillion won.

It would be the company's worst decline in quarterly profits since the third quarter of 2014.

In a statement, Samsung said fourth-quarter profits were "well below current market expectations", blaming the performance on macroeconomic issues, spurred by central banks around the world raising interest rates.

Weak demand for memory chips was "greater than expected as customers adjusted inventories... to further tighten finances", it said.

It added that this was "spurred by concerns over deteriorating consumer sentiment caused [by] continued high global interest rates and weak economic outlooks".

Against that backdrop, the Galaxy smartphone maker also "saw a significant drop in the memory business results due to lackluster demand and also weaker sales of smartphones", it added.

It was the first time in four years that Samsung issued an explanatory statement alongside their earnings predictions.

The firm is the flagship subsidiary of the giant Samsung Group, by far the biggest of the family-controlled conglomerates that dominate business in Asia's fourth-largest economy and one that is crucial to South Korea's economy.

"Samsung Electronics is extremely crucial to the South Korean economy," Kim Dae-jong, professor of business at Sejong University in Seoul, told AFP.

"Looking at today's announcement, this year will be a very difficult year. Not only Samsung, but the entire Korean economy seems to have to come up with a good survival strategy for the year ahead."

The widely expected fourth-quarter drop is the second consecutive margin squeeze for Samsung, which saw a 31.39 per cent fall in operating profits in the third quarter year-on-year.

Until the second quarter of last year, Samsung, along with other tech companies, had benefited significantly from strong demand for electronic devices — as well as the chips that power them — during the pandemic.

But the global economy is now facing multiple challenges, including soaring inflation, rising interest rates and a growing threat of a broad debt crisis.

The company is expected to release its final earnings report at the end of this month.

TUNIS — Dozens of Tunisian lawyers protested on Thursday against newly imposed taxes on legal services, part of a 2023 budget that seeks to boost revenues to the cash-strapped treasury.

Led by Bar Association head Hatem Mziou, lawyers gathered outside the Palais de Justice in Tunis as well as other sites, after the association called for a "day of rage".

The budget, unveiled last week, imposes new taxes to claw the North African country's deficit back to near 5 per cent of GDP, as it awaits an international bailout.

Among the measures are a hike in taxes on legal fees, from 13 to 19 per cent.

The Bar Association says its 9,200 members will only be liable for the new, higher rate when it is actually paid — along with their fees — by their clients.

It has also pointed out that the tax will hit legal service users from disadvantaged backgrounds hardest.

Mziou said in a speech that the new law "will help make citizens even poorer".

He also said Tunisian lawyers "will not stay idle in the face of attacks on rights and liberties".

He cited a controversial September decree by President Kais Saied which provides for jail terms against people found guilty of spreading false rumours "in order to undermine public security". 

A lawyer who is defending a group of judges sacked by Saied said earlier this week that he is facing investigation under the law.

Saied in July 2021 launched a dramatic power grab, sacking the government and freezing parliament, later moving to seize control of the judiciary and pushing through a custom-made constitution cementing his grip on the executive.

His moves have come with Tunisia mired in an economic crisis that has caused repeated shortages of essential goods as well as spiralling inflation.

On Wednesday evening, Saied told Interior Minister Taoufik Charfeddine that "freedom doesn't mean chaos and plotting against the state", according to a statement from Saied's office.

Without naming anyone, he accused "certain people supported by known lobbies" of "violating the law and undermining national security".

BAGHDAD — Iraqi telecommunications worker Youssef Ahmed is married with a five-year-old son, but lives with his parents because he is unable to afford his own home amid soaring property prices. 

"Even if your income increases, it will never be up to the exorbitant prices of houses or land", said 29-year-old Ahmed, who earns a "comfortable" monthly salary of $1,000, double the national average.

In oil-rich but corruption plagued Iraq, real estate has become a popular way to launder money, including stolen public funds.

Compounded by housing planning failures and an increasing demand, it has pushed prices in the capital Baghdad rapidly out of reach for many ordinary Iraqis.

Iraq's banking system remains underdeveloped: only one in five have bank accounts, according to the World Bank.

"Real estate transactions are done in cash", said economist Ali Al-Rawi, meaning that property sales are a way to "easily and quickly hide money in land and buildings".

Baghdad's municipality is blunt about the cause of property price rises.

"The increase in real estate prices is not linked to the market, it is linked to the mafias and money laundering," spokesman Mohammed Al Rabie said.

"Poor planning" by previous governments and a lack of investment in housing were also factors, he added.

'Staggering' 

The violence that devastated Iraq following the US-led 2003 invasion to topple Saddam Hussein meant real estate prices in Baghdad tumbled, or at best stagnated.

Many investors preferred to purchase property in the autonomous Kurdish areas of the country's north, or even in neighbouring Turkey.

But in recent years, the metropolis of nine million inhabitants has returned to relative stability. Baghdad's property market is now on the rise.

In the commercial district of Karrada, where old crumbling brick villas stand beside gleaming new buildings, the price per square metre once stood at around $1,200 to $1,700, said estate agent Samer Al Khafagi.

Today, it goes for $3,000 — and sometimes as high as $5,000, Khafagi said. 

"The market is growing," he said, noting prices have accelerated over the past year.

In the neighbouring Jadriya district, popular among Iraq's economic and political elite, estate agent Hussein Al Safar said price increases have been "staggering".

"Strong demand" has pushed per metre prices in the area up to $4,000, and as high as $8,000 for commercial properties, he said.

Billions stolen 

A corruption scandal in November, where it was announced $2.5 billion had been stolen from Iraq's tax authorities, shone a light on the usually opaque dealings of laundered funds.

Prime Minister Mohammed Shia Al Sudani said recovery of the stolen cash was complicated by the fact it had gone into "the purchase of significant real estate in prestigious areas of Baghdad".

Sajad Jiyad, a fellow at the Century International think tank, reported that "more than $1 billion" had been used to buy 55 properties in Baghdad, while another $1 billion funded "other property, land and other assets".

The government recently announced ambitions to build low-cost housing for Iraq's poorest citizens, with around 1 million Baghdad residents estimated to live in informal settlements.

On the outskirts of Baghdad, the lush farmland and palm groves that were once the pride of Iraqis are vanishing under concrete — as real estate profits prove more lucrative than agriculture.

But ordinary Iraqis like Ahmed, dreaming of their own home, see little chance of change.

Ahmed considered taking out a bank loan to secure a home. Yet with high interest rates of up to 10 per cent, the finances do not add up, he said. Moving to the suburbs isn't an option either.

"If you move away from the centre, there is the problem of transport — and even so, the prices do not drop that much," Ahmed said. "I thought a lot, there is no solution".