BUSINESSWednesday 7 February 2018

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Third generation Cayenne to

uphold legacy

GWC bullish on Qatar’s logistics industry

Qatar Steel signs off-take deal with MuntajatTHE PENINSULA

DOHA: Industries Qatar (IQ), one of the region’s industrial giants with interests in the production of a wide range of petrochem-ical, fertiliser and steel products, has announced the signing of an off-take agreement between Muntajat and Qatar Steel to migrate the marketing, sales and distribution activities of Qatar Steel’s entire production to Muntajat.

This agreement comes as part of Industries Qatar’s efforts to maximize its shareholders’ value and strengthen the national economy through its continuing initiatives of com-mercial and cost optimisation, and expand the strong capabil-ities of national entities.

The migration arrangements have commenced and are sched-uled to be completed by the beginning of the second half of 2018. At that stage, Muntajat will f o r m a l l y t a k e

over the marketing, selling and distribution activities of Qatar Steel’s entire production.

This new arrangement cap-italises on the strengths of both companies. Qatar Steel

will continue to focus on steel production and to enhance its operational and financial per-formance through efficiency improvement, cost reduction and other operational syner-gies.

Muntajat will apply its knowledge and accumulated know-how in global marketing to reach a wider customer base for Qatar Steel’s products inter-nationally, which will in turn augment Qatar Steel’s ability to achieve higher netbacks in newly penetrated markets.

Having the aforementioned agreement in place will further improve Qatar Steel’s perform-ance by decreasing the transpor-tation and shipping costs as well as provide more innovative and efficient logistic capabilities.

This agreement will make Muntajat the sole marketer and distributor of Industries Qatar’s finished products, which will increase the ability to achieve synergies at a group level through being more efficient in both import and export shipping activities, thus providing for fur-ther cost reduction.

Muntajat (Qatar Chemical and Petrochemical Marketing and Distribution Company Q.J.S.C.), is a state-owned com-pany established in 2012 to serve as the exclusive marketer, dis-tributor and seller of over 13.6 million metric tons of chemical and petrochemical products.

With a global marketing net-work of offices around the world, a diversified portfolio of high quality polymer, chemical

and fertiliser products from renowned producers in the industry and a network servicing more than 3,000 customers in 135 countries; Muntajat delivers value to Qatar’s downstream industries, capitalising on its unique business model, econo-mies of scale, capturing new opportunities, expanding the reach of its trusted brand glo-bally and providing world class customer service.

Originally incorporated in 1974, Qatar Steel Company is fully-owned by IQ and has sev-eral investments in the steel industry including, the subsid-iary, Qatar Steel Company FZE, and three associates, Foulath Holding B.S.C., Qatar Metals Coating Company W.L.L and SOLB Steel Company.

Best fruits from northern Caucasus to hit local marketMOHAMMAD SHOEB

THE PENINSULA

DOHA: Some of the world’s best agro-products, including fruits and vegetables grown in the North Caucasus region, are expected to hit the Qatari market very soon as the visiting Presi-dent of the Russian Republic of Ingushet ia , Yunus-bek Yevkurov, and members of his accompanying delegation held a meeting with Qatari busi-nessmen yesterday.

The President, during his meeting, invited the Qatari busi-nessmen to invest in some of the most promising sectors of Ingushetia’s fast growing economy, especially agriculture and tourism sectors.

Ingushetia, located in the North Caucasus economic region, is the smallest and youngest republic within the Russian Federation, having only achieved this status around twenty-five years ago. It sits closed to Georgia and Chechnya.

The meeting was held in col-laboration with Qatar Chamber (QC). The Qatari side was pre-sided over by Mohammed bin Ahmed bin Towar Al Kuwari, Vice-Chairman of QC, while President Yevkurov chaired the Ingushetia side.

Umalat Torshkhoev, Minister of Economic Development of the Republic of Ingushetia, provided a detailed presentation high-lighting the major infrastructure development projects and investment opportunities in the economy.

“There are many opportu-nities of investments for Qatari businessmen in Russia in gen-eral and the Ingushetia in par-ticular. The good relations between Qatar’s Emir H H Sheikh Tamim bin Hamad Al Thani and President Vladimir Putin, have pushed forward to establish and enhance ties between the two sides,” Presi-dent Yevkurov noted.

Speaking to The Peninsula on the sidelines of the meeting, President Yevkurov, added: “I think our visit to Qatar was very successful. Both sides are working to sign several agree-ments to establish bilateral coop-eration very soon.”

He also noted that Ingush-etia is endowed with natural resources, such as mineral water in Achaluki, oil and natural gas in Malgobek, forests in

Dzheirakh, and metals in Galashki region.

In addition, Ingushetia also boasts of the unique history, nat-ural and mountainous beauty, and the ancient Galgai towers,

which are the major attractions for tourists.

He said that there are a lot of areas where Qatar and Ingush-etia can cooperate for mutual benefits. Since there are no formal trade relations between the two, so the potential for growth is very high.

“We have some of the world’s best agro-products, including fruits and vegetables. Currently we are focusing to establish cooperation in the field of agriculture, food processing industries, and tourism devel-opment. Eventually it can be fur-ther expanded to cooperation in the field of energy, civil aviation and other sectors,” said Yevkurov who has been heading the government of Ingushetia since October 2008.

Asked about the signing of agreements for investment pro-tection, the President reiterated that both sides are working

closely to establish and expanding ties, investment pro-tection will be one of the several agreements both sides are expected to be signing very soon.

“We are going to export some of the best fruits and other food stuff to Qatar very soon. We also invite Qatari businessmen and tourists to visit Ingushetia and investment opportunities. There are many privileges to invest which include tax rebates, free-land plots, that too without any bureaucratic delays,” the President added.

“If there are any problems or hurdles businesses and investors face, they can directly contact with me without any hesitation.”

The President also praised about friendly discussions with the Qatari leaders, and many other things about the country, including the rich culture and hospitality.

The deal aims to migrate the market-ing, sales and distri-bution activities of Qatar Steel’s entire production to Munta-jat and comes as part of Industries Qatar’s efforts to maximize its shareholders’ value and strengthen the national economy.

The migration arrangements are

scheduled to be completed by the beginning of the

second half of 2018.

(Left) Yunus-bek Yevkurov, President of the Republic of Ingushetia, and Mohammed bin Towar Al Kuwari, Vice-Chairman of Qatar Chamber with other officials during the meeting with Qatari businessmen held at Sheraton Hotel, yesterday.PIC: BAHER AMIN/THE PENINSULA

We have some of the world’s best agro-products, including fruits and vegetables. Currently we are focusing to establish cooperation in the field of agriculture, food processing in-dustries, and tourism development. Eventu-ally it can be further expanded to coop-eration in the field of energy, civil aviation and other sectors.

There are many privileges to invest

in Russian Republic of Ingushetia, which include tax rebates, free-land plots, that

too without any bureaucratic delay

Wall St drops in volatile trade after steep fallsREUTERS

NEW YORK: US stocks fell in volatile trading yesterday, as a pullback from record highs steepened following the biggest one-day declines for the S&P 500 and Dow in more than six years.

Major indexes swung up and down after starting the session 2 percent lower, underscoring a return of vol-atility to a market that until recently had been known for the absence of such major shifts.The sharp declines in recent days marked a pull-back long-awaited by inves-tors after the market minted record high after record high in a relatively calm ascent.

The Dow Jones Industrial Average fell 34.37 points, or 0.14 percent, to 24,311.38, the S&P 500 lost 7.95 points, or 0.30 percent, to 2,640.99 and the Nasdaq Composite dropped 17.12 points, or 0.25 percent, to 6,950.41.

The market’s pullback comes amid concerns about rising bond yields and higher inflation.

Yesterday was another day of volatility a day after a steep sell off that brought the biggest percentage daily declines for the S&P 500 and the Dow since August 2011 and a near 1,600 point intraday loss for the Dow.

At its session low yes-terday, the S&P had declined 9.7 percent from its Jan 26 record high. At its lowest point on Tuesday, the Dow was off 10.7 percent from its Jan 26 record.

8,651.48 -186.17 PTS2.11 %

QSE FTSE100 DOW BRENT7,174.75 -160.23 PTS2.17%

24,268.13 -77.62 PTS0.32% Dow & Brent before going to press

$63.70 -0.45

22 WEDNESDAY 7 FEBRUARY 2018BUSINESS

GWC bullish on Qatar’s logistics industrySATISH KANADY

THE PENINSULA

DOHA: Qatar’s leading logistics provider GWC is looking to increase its warehousing capa-bilities and trade volumes. GWC, which signed a major deal with Al Asmakh Real Estate Develop-ment recently, said yesterday it has long-term plans and inno-vative projects in pipeline.

“GWC has long term plans and we are pursuing them in line with the country’s development vision. We are exploring new markets, both locally and inter-nationally, and looking for new opportunities for diversifying our businesses,” Mohammad Daoud, GWC’s official spokesperson told The Peninsula.

Over 70 percent of the Bu Sulba Logistics Hub managed by GWC has already been occupied.

GWC is receiving heavy enquir-ies from potential investors for the Al Asmakh Logistics Park development project.

The Bu Sulba logistics hub is a self-contained logistics center spread across an area of 517,376 square meters with a built-up area exceeding 40 percent of the total. The facility features around 194 warehousing units of differ-ent specifications optimized for SMEs, as well as a container yard, labour accommodation, first aid center, a mosque, and commer-cial and other amenities. The warehouses are offering a vari-ety of storage solutions ranging from dry, temperature-control-led, chilled and frozen as well as bulk storage, while taking into consideration the specific needs

of the SMEs. Addressing GWC’s ordinary general assembly on Monday, Abdulla Fahad Jassem Jabor Al Thani (pictured), Chair-man of GWC said the Bu Sulba Warehousing Park is one of the

best examples of Qatar’s public-private partnership (PPP) initiative. He said the company has laid foundations and strate-gies in line with Qatar’s long-term vision.

As per a management agree-ment signed between GWC and Al Asmakh Real Estate Develop-ment a couple of weeks ago, the facility will be managed by GWC for the 22-year period between 2018 – 2040. “The facility is ready and we have started receiving encouraging enquires from potential investors. Both GWC and Al Asmakah are big names in the respective indus-tries. The market can certainly expect a quality services at the facility”, Mohammad said.

With the support of

world-class Hamad Port, Qatar is fast emerging as a major re-export hub. The country’s logistics sector is going to bene-fit hugely from this opportunity. The market can expect exciting announcements from GWC in the coming days, he said.

Market intelligence report noted that the growth in contract and logistics drove Qatari mar-ket during the past couple of years. The period has been the period of adjustments with fluc-tuating oil prices and reduced investments. Even though, there has been a fall in oil and gas projects for the logistics provid-ers, the warehousing segment has been on rise with improved warehousing solutions provided by major players.

Commercial Bank targets top Qatari talent at career fairTHE PENINSULA

DOHA: Commercial Bank’s National Development Team will be participating at the Education City Career Fair from February 6 to 7, 2018 to recruit top Qatari nationals.

Commercial Bank’s National Development Programme invests significant resources towards the skills and training of young Qataris as part of the Bank’s commitment to develop-ing talent in line with the National Vision 2030 for the benefit of current and

future generations. The National Development Team, part of Commercial Bank’s Human Cap-ital Department, is looking to hire the best local talents available in the market to join the Bank’s pro-fessional team and embark on a successful career in banking.

Commercial Bank Group CEO Joseph Abraham said: “Commercial Bank is proud of our Qatari heritage and being the go-to local bank for the full spec-trum of Qatari banking needs. Qatari nationals who are ambi-tious, innovative and share our entrepreneurial vision stand to

have a great career at Commer-cial Bank and be part of the dynamic new banking profes-sion of the future.”

Commercial Bank Acting Chief Human Capital Officer Abdulla Al Fadli said: “Commer-cial Bank invests in young Qataris to become the next gen-eration of highly skilled banking leaders, and we are rolling out new National Talent Develop-ment Programmes during mid-2018 to ensure our future leaders receive the very best training and enhanced profes-sional development.”

Commercial Bank officials at the Education City Career Fair.

Nigeria’s president signs order to boost local productionREUTERS

YENAGOA: Nigeria’s President Muhammadu Buhari signed an executive order on Monday aimed at boosting the domes-tic production of goods and creating jobs in science, tech-nology and engineering in the west African country.

Buhari, a 75-year-old former military ruler, has fre-quently spoken about ending the OPEC member’s depend-ence on oil exports while also creating jobs by boosting local food production.

Months after Buhari came to power in May 2015, the cen-tral bank restricted access to foreign currency to import cer-tain goods in a bid to stimulate local manufacturing.

He said the order related to the planning and execution of projects related to science, engineering and technology, as well as national security.

“I have repeatedly empha-sized my vision for a Nigeria that produces what it con-sumes. To attain that vision, it is vital that local companies get preference in planning, design-ing and executing Sci, Tech & Eng. projects,” Buhari said on his official Twitter feed late on

Monday. The president “ordered that all ‘procuring authorities shall give prefer-ence to Nigerian companies and firms in the award of contracts, in line with the Public Procure-ment Act 2007’,” the presidency said in a statement circulated on Monday. The executive order also prohibits the minis-try of interior from giving visas to foreign workers whose skills are readily available in Nigeria, the statement said.

Around four out of every 10 people in Nigeria’s workforce were unemployed or underem-ployed by the end of September, according to data released by the statistics office in December.

The order states that con-sideration will only be given to a foreign professional “where it is certified by the appropri-ate authority that such expertise is not available in Nigeria”.

Nigeria, which has Africa’s largest population and biggest economy, fell into a recession in 2016 largely caused by low oil prices and militant attacks on energy facilities in the Niger Delta region.

It emerged from recession in the second quarter of 2017, largely on higher oil prices.

BP’s annual profit rockets on higher oil pricesAFP

LONDON: British energy major BP said yesterday that 2017 net profits rocketed to almost $3.4bn (¤2.7bn), boosted mostly by a recovery in the crude oil market.

Earnings after taxation for the full year compared with $115m in 2016, BP said in a statement.

“The results primarily reflected higher oil prices,” the London-listed giant said.

The news comes one week after Anglo-Dutch rival Royal Dutch Shell unveiled annual profit of $13bn, also energised by rising oil and gas prices.

BP’s underlying replace-ment-cost profit -- which excludes fluctuations in the value of crude oil inventories -- more than doubled to $6.2bn last year.

The results come one year after BP launched a five-year strategy aimed at returning the group to growth, as it continues to recover from the devastating 2010 Gulf of Mexico oil spill catastrophe.

BP said its upstream business, comprising explo-ration and production, saw output leap 12 percent to 2.47 million barrels of oil equiva-lent per day -- the highest level since the year of the disaster.

The company’s perform-ance was also lifted by solid earnings at its downstream division that comprises refin-ing, marketing and distribution.

BP said it was hit by an additional $3.18bn of Gulf-related costs in 2017.

That brings total costs linked to the disaster -- including fines and compensation to businesses -- to $65.8bn.

“2017 was one of the strongest years in BP’s recent history,” said chief executive Bob Dudley.

“We delivered operation-ally and financially, with very strong earnings in the down-stream, upstream production up 12 percent, and our finances rebalanced. And we did all this while maintaining safe and reliable opera-tions.....We enter the second year of our five-year plan with real momentum, increasingly confident that we can continue to deliver growth across our business, improving cash flows and returns for shareholders out to 2021 and beyond,” the CEO said.

“We had strong delivery and growth across BP in 2017,” noted chief financial officer Brian Gilvary.

Norway Wealth Fund should `immediately’ cut oilBLOOMBERG

OSLO: Norway’s $1.1 trillion wealth fund shocked the world last year when it announced a plan to divest all its oil and gas stocks, worth $35bn at the time.

As the government and par-liament prepare to give their responses, a former senior eco-nomic adviser who used to work for the fund says the investing giant shouldn’t waste any time and start selling now.

“If Norges Bank sincerely believes its advice, it should probably consider using the room for active positions to immediately, but gradually, decrease its oil and gas hold-ings,” said Espen Henriksen, who now works as an associate pro-fessor at the Norwegian Business School in Oslo.

The fund’s plan to exit oil is based on a desire to improve the country’s risk exposure, and not on ethical considerations. As western Europe’s biggest oil and gas producer, Norway gets about 50 percent of its goods exports from its commodities. But with the rapid growth of renewable energies, there’s speculation that demand for petroleum is close to peaking, raising the risk of investing in companies that pro-duce the fuels.

T he matte r i s

being analyzed by the Finance Ministry, which is due to release a white paper this spring.

The government will then give its opinion in the second half of the year before parlia-ment decides. The fund, which is part of the central bank, gets its investment guidelines from government.

By going public with its wishes, the fund has put pres-sure on the government. But the tactic could backfire.

Henriksen says the fund manager’s move “risks creating an unfortunate precedent by giv-ing the asset manager more political power to define its mandate.”

The ruling Conservatives are “open” to a change in the index, but stress the need for a thor-ough analysis, said Mudassar Kapur, a Conservative member of parliament’s Finance Com-mittee. The Conservatives head a three-party minority government.

But a majority on the com-mittee say the 2014 oil-price shock revealed vulnerabilities in Norway’s economy and want the ministry to go over the pro-posal as quickly as possible. Opposition parties in 2015 forced through a divestment of shares in coal companies against the government’s wishes.

“Our experience with the management of the oil fund is that to a large extent we’ve had to secure decisions in parliament against the Finance Ministry’s advice,” said Kari Elisabeth Kaski, a Socialist Left lawmaker on the Finance Committee. “I wouldn’t be surprised if this is what happens this time around as well.”

Meanwhile, the planned ini-tial public offering of shares in Saudi Aramco, Saudi Arabia’s oil

behemoth, has added another ripple to the debate. The fund typically invests in large IPOs ahead of time, but may sit this one out, given its views on oil exposure.

According to Kaski, Aramco makes the debate more “relevant.”

At the Finance Ministry, State Secretary Marianne Groth says the matter will be “treated in a thorough and good manner.”

Thomas Sevang, a spokes-man for the fund, declined to comment before the Finance Ministry has given its view. The fund has previously said any divestment of oil and gas com-panies would take place over many years.

But the investor has some leeway to act on its own, pro-vided its return doesn’t deviate more than 1.25 percentage point from the return of its bench-mark. And as the largest sovereign wealth fund in the world, it’s become adept at cov-ering its tracks when it trades shares to avoid being front-run.

“I’m confident that this will be handled in a professional manner, and that we don’t end up in a situation where we lose money on clumsiness,” Henrik-sen said.

Over 70% of the Bu Sulba Logistics Hub managed by GWC has already been occupied. GWC is receiving heavy enquiries from potential investors for the Al Asmakh Logistics Park development project.

EU to probe Apple plan to buy ShazamAFP

BRUSSELS: The European Union said yesterday it will probe tech giant Apple’s plan to buy leading song recogni-tion app Shazam because of fears the deal may “adversely affect competition.”

Apple announced the deal with London-based Shazam, worth a reported $400m, in December in a fresh bid to secure an edge in the intensifying battle of streaming services.

The European Commis-sion said it launched the inquiry at the request of EU states Austria, France, Italy, Spain and Sweden, and non-EU Norway and Iceland, which form part of the affili-ated European Economic Area. “The commission con-siders that the transaction may have a signficant adverse effect on competition in the European Economic Area,” it said in a statement.

The deal did not meet the “turnover thresholds” for the European Commission -- the EU’s executive arm and anti-trust enforcer -- for Brussels to launch a probe by itself.

As western Europe’s biggest oil and gas producer, Norway gets about 50% percent of its goods exports from its commodities. But with the rapid growth of renewable energies, there’s speculation that demand for petroleum is close to peaking, raising the risk of investing in companies that produce the fuels.

23WEDNESDAY 7 FEBRUARY 2018 BUSINESS

Third generation Cayenne to uphold legacyTHE PENINSULA

DOHA: The latest generation of Porsche’s successful SUV model line is now available in Qatar.

Arrival of the brand’s flagship SUV was celebrated at a special event held by Porsche Centre Doha, Al Boraq Automobiles at St. Regis Hotel, where the Cay-enne and Cayenne S, were show-cased to attending guests.

A completely new develop-ment brings the Cayenne closer to its racetrack roots and offers greater versatility and more per-formance than ever before. Pow-erful turbo-charged engines, enhanced chassis systems, a range of off-road modes and a sharper design underpin the model’s credentials as a true sports car in its segment. Addi-tional enhancements to the latest generation also include intelli-gent assistance systems and more connectivity features aimed at offering improved driver and pas-senger comfort.

Salman Jassem Al Dariwsh, Chairman and CEO of Porsche Centre Doha, said: “Since its ini-tial launch, the Cayenne has been one of the most popular models in Qatar, and I have no doubt that the third generation, which offers even more sports car perform-ance and practicality, will con-tinue this success story. For me, the new Cayenne’s versatility is truly unique. It is at home on any road, but it is equally ready to explore new terrain. It enjoys a short sprint as much as a long road trip, and the commute to work as much as a lap on the track. It is capable of producing a superb drive experience virtu-ally anywhere, and that is really what sets the Cayenne apart from any other SUV. We’re very excited to be welcoming it to Qatar today.”

A bold new design stays true to the unmistakable identity of the Cayenne but deliv-ers a more streamlined, athletic impression to complement an increased

length and lower height. The pronounced bonnet, redesigned headlight contour and trademark large air intakes underline the Cayenne’s improved driving dynamics from the front. Nar-rower side windows, a rede-signed rear wing, wide rear end with integrated light strip and wider alloy wheels further enhance and emphasise its sports car genes.

The new Cayenne offers a spacious cabin, with several comfort and convenience fea-tures throughout. The luggage compartment has been increased by 100 litres, mean-while the Porsche Advanced Cockpit concept brings the vehicle and the occu-pants closer through increased con-nectivity and intuitive controls. The centre con-sole with Direct Touch Control and a new 12.3-inch touch display for the Por-sche Communication Manage-ment act as the driver’s interface to all vehicle functions. PCM can be configured for up to six indi-vidual profiles to store a large number of in-terior settings, as well as specifications for lights,

driving programmes and assis-tance systems.

A true all-rounder, five pre-programmed drive and chassis modes can be activated in accordance to the terrain via the PCM. As well as the default Onroad programme, drivers can choose between Mud, Gravel, Sand and Rocks settings to adapt to the relevant conditions. Depending on the selection made, the control unit optimally conditions the engine and chassis systems including the new Tip-tronic S, the Por-sche Traction Management (PTM) all-wheel system and the PSM stabilisation pro-gramme. The air suspension, PASM damper system, PDCC rolling-motion compen-sation and the rear axle steering are also activated if the options are fitted.

The new lightweight chassis of the Cayenne has been com-pletely redesigned from scratch to deliver the optimum balance between sporty performance and comfort, and contributes to an overall weight saving of up to 65 kilograms despite an extend-ed range of standard equipment.

With the exception of the active PASM damper sys-tem, all chassis systems are new, including the adaptive three-chamber air suspen-sion and electric roll stabilisation. The 4D Chassis Control connects all the systems to add to the enhanced driving dynamics of the range. The Porsche Surface Coated Brakes, which come as standard in the Turbo, make a global debut and offer im-proved responsive-ness as well as an up to 30% longer service life.

For the first time, the Cay-enne is available with rear-axle steering as an option, and a mixed tyre configuration. The tyres are also larger than before, ranging from 19 to 21 inches. Both developments are derived from the 911 to improve agility, sta-bility and safety, whilst rear-axle steering also reduces the turning circle by 0.6 metres for even greater practicality.

Performance driven enginesThe third generation model

range combines powerful and efficient engines with a new, responsive eight-speed Tiptronic S gearbox which enhances

capabilities thanks to shorter response times and sportier ratios in the lower gears. The six-cylinder turbo engine of the Cay-enne delivers 450 Nm of torque and 340 hp, a 40 hp increase on its predecessor. It reaches 100 km/h in 6.2 seconds, or just 5.9 seconds with the optional Sport Chrono Package, and has a top speed of 245 km/h.

The Cayenne S is powered by a 2.9-litre, biturbo-charged V6 engine with 440 hp (an increase of 20 hp) and 550 Nm of torque. It reaches 100 km/h in 5.2 sec-onds (4.9 seconds with the optional Sport Chrono Package) and boasts a top speed of 265 km/h.

With its 550 hp biturbo eight-cylinder engine, the Cayenne Turbo is the top model in the new generation and exceeds the engine of its predecessor by 30 hp, while the maximum torque of 770 Nm represents an increase of 20 Nm. It accelerates from ze-ro to 100 km/h in 4.1 seconds (or 3.9 seconds with the Sport Chrono Package), and achieves a top speed of 286 km/h.

The Cayenne Turbo sets itself apart as the leader of the new generation. It is the first SUV to have an adaptive roof spoiler as part of its active aerodynamics. Similar to the 911 Turbo, the spoiler adapts the aerodynamics and downforce to suit the driving conditions. Visually, the Turbo is easily identifiable by its distinc-tive twin tailpipes, enlarged air intakes, double-row front-light modules and 21-inch Turbo wheels in dark titanium embla-zoned with the coloured Porsche crest. The rear apron, exterior mirrors and door side trims are finished in the vehicle colour. Adaptive sports seats with 18-way adjustment, unique stitching and raised side bolsters come as standard in the top-of-the-range model. The Turbo comes equipped with a BOSE® Surround Sound System to deliver true clarity of sound to all five seats for even more drive en-joyment.

The new Porsche Cayenne, Cayenne S and Cayenne Turbo are now available at Porsche Centre Qatar.

Salman Jassem Al Darwish, Chairman and CEO of Porsche Centre Doha during the launch of New Model of Porsche Cayenne in Doha yesterday. PIC: ABDUL BASIT/THE PENINSULA

Salman Jassem Al Darwish, (right) Chairman and CEO of Porsche Centre Doha with Ahed Dawood, Brand Manager, Porsche Center Doha, during the launch of new model of Porsche Cayenne in Doha, yesterday. PIC: ABDUL BASIT/THE PENINSULA

Bitcoin drops below $6,000 for first time in three monthsAFP

TOKYO: Bitcoin plunged more than 20 percent to fall below $6,000 yesterday, its latest sharp loss following a series of setbacks, with a global stock market collapse fuelling the selling.

The virtual currency fell to $5,992 for the first time since mid-November, according to Bloomberg News, the latest hammering for the cryptocur-rency that saw a stratospheric 26-fold rise last year.

Tuesday’s collapse comes just six weeks after bitcoin hit a record high of $19,511, fuelled by a flood of speculators looking to make a quick buck.

Since those heady days the cryptomarket -- which includes dozens of other units -- has been pounded by news of crackdowns by governments including in China, Russia and South Korea, one of the biggest markets for the sector.

On Thursday, India said it would “take all measures to eliminate” cryptocurrencies’ use as part of a payment system and in funding illegitimate activities, while Japanese authorities raided a virtual

currency exchange after it lost $530 million to hackers.

Central banks in Europe, Japan and the United States have also flagged concerns about the unit. This week sev-eral commercial lenders said they would stop allowing their customers to buy bitcoin through their credit cards owing to debt concerns.

Stephen Innes, head of trading for Asia Pacific at Oanda, said “the dynamics behind the moves are regula-tory clampdowns and investors losing confidence in crypto”.

The sell-off on Tuesday was exacerbated by crushing losses on world stock markets, with the Dow on Wall Street suffering its biggest one-day points loss and wiping out all its 2018 gains.

Panicked investors are fret-ting over rising US borrowing costs, leading them to cash in profits after a stellar couple of months that have seen many indexes hit record or all-time highs.

Equities have enjoyed months of surges fuelled by optimism over the US economy, corporate earnings and the global outlook.

A visual representation of the digital cryptocurrency Bitcoin.

Carillion’s former chairman takes ‘full responsibility’ for collapseREUTERS

LONDON: The chairman of Carillion said he took “full and complete” responsibility for the construction firm’s collapse, which has put thousands of jobs on the line and left creditors, suppliers and pensioners facing losses of millions of pounds.

Employing nearly 18,000 people in Britain, Carillion failed on Jan. 15 when its banks halted funding, triggering Britain’s big-gest corporate demise in a decade and forcing the government to step in to guarantee vital public services.

The failure ignited a row over Britain’s outsourcing of public services to private companies, and whether in the case of Car-illion it was run for the benefit of shareholders and bosses, and not its staff or customers. Philip

Green chaired the construction and support services firm from 2014 until it was put into liquida-tion after the government refused to bail it out.

“My responsibility is full and complete—not necessarily cul-pability but no question about full responsibility,” he told a com-mittee of lawmakers on Tuesday in parliament.

Green said the company was unable to reduce debt built up from previous acquisitions, and was left with no “wriggle room” to cope with a drop in cash flow when four major contracts rap-idly deteriorated last year.

Former chief executive Richard Howson, who earned around £1.5m in the year before he stepped down in July 2017 after a profit warning, said he was “deeply saddened and sorry”. He said the group had struggled to

collect cash on some of its major contracts, particularly in the Middle East, and that he was spending around 60 percent of his time chasing payments. The lawmakers asked why the com-pany had increased dividends in 2013 and 2014 when the group’s cash flow was under pressure.

Howson said the dividends were necessary to demonstrate the board’s confidence in Caril-lion’s prospects and help it win new contracts. Interim Chief Executive Keith Cochrane also apologised and said he had fought to save the 200-year-old firm.During a tense hearing, the lawmakers questioned whether the company’s executives had taken on too much risk and had failed to put controls in place to cope with cost overruns and the delay by some customers in paying for work.

FROM LEFT:Carillion CEO, Keith Cochrane; Finance director Emma Mercer; and formeer Finance director Zafer Khan answering questions at a joint hearing of the Commons Business, Energy and Industrial Strategy Committee and the Work and Pensions Committee on the collapse of Carillion at Portcullis House in London, yesterday.

Brazil for fresh interest rate cutAFP

RIO DE JANEIRO: Brazil’s central bank is expected to pare back its key interest rate today by 0.25 percentage points but analysts say polit-ical uncertainties mean the 11th consecutive cut would be the last for a while.

The cut would bring the Selic rate to a new low 6.75 percent, following a half per-centage point reduction in December which took the key rate to a record low seven percent, about half of what it had been a year before.

Rates have been coming down steadily, along with a strong fall in inflation and the economy’s slow emergence from a stifling two-year recession. However, the cen-tral bank may decide to put the brakes on this policy in view of the uncertainty sur-rounding October presiden-tial elections, analysts say.

That means the expected 6.75 percent rate would be here to stay through the “vol-atile” year, said Fabricio Stagliano, from Walpires Cor-retora. “It is hard to make pre-dictions for the interest rate because the more time that passes, the more room there is for uncertainty,” he said.

High among those doubts is whether center-right Pres-ident Michel Temer will manage to push through cuts to the pension system, the keystone of austerity reforms aimed at bringing discipline to the floundering economy.

There is also a question over the chances of any busi-ness-friendly centrist candi-date in the elections.

24 WEDNESDAY 7 FEBRUARY 2018BUSINESS

Angola oil minister sees no further Opec cutsREUTERS

CAPE TOWN: Angola sees no further Opec cuts in 2018 and Africa’s No. 2 crude exporter hopes to join the ranks of gold producers next year as it strives to diversify an economy long based on oil and diamonds, its minerals and petroleum minis-ter said yesterday.

Angola, where oil wealth has failed to translate into wider prosperity, has a reputation for graft on a grand scale but Pres-ident João Lourenço, who took power in September, is seeking to win credibility with interna-tional investors.

Speaking to Reuters at the annual Africa mining conference in Cape Town, minerals and oil minister Diamantino Azevedo (pictured) said the southwest African country was serious about widening its commodi-ties mix.

“We are just producing

diamonds and stuff like marble and granite at the moment. We are expecting to start gold pro-duction soon, we expect to have two or three gold mines oper-ating next year but at a small scale,” he said.

Speaking after presentations on mining opportunities in Angola, Azevedo said there were 10 exploration projects in the

country focused on gold involv-ing junior mining companies, which typically take the pros-pecting lead in new frontiers. He did not name them.

“We want to promote the mining sector beyond diamonds ... We have had good meetings here with the major mining companies,” Azevedo said.

He said there were also exploration opportunities for iron ore and copper. Angola bor-ders Democratic Republic of Congo and Zambia, Africa’s top copper producers.

Much of Angola remains unexplored, not least because the former Portuguese colony was embroiled in a civil war from its birth in 1975 until 2002.

Critics have also said the elite of the ruling MPLA party under former President Jose Eduardo dos Santos had little incentive to reduce the econo-my’s reliance on the opaque oil sector.

Angola is a member of the Organization of the Petroleum Exporting Countries, and it must limit output in line with Opec’s commitment to cut output by about 1.2 million barrels per day (bpd) as part of a deal with Rus-sia and others.

“We will not go above our Opec quotas,” Azevedo said, adding that he did not see Opec imposing any deeper cuts this year. Angola produces just over 1.6 million BPD, providing it with over 90 percent of its export revenue.

BNP Paribas says profits up despite ‘lacklustre’ marketsAFP

PARIS: French bank BNP Pari-bas said yesterday that its profits rose last last year as good business performance in all divisions helped cushion it against a “lacklustre interest rate and market environment.”

BNP Paribas said in a statement that net profit edged forward by 0.7 percent to ¤7.8bn ($9.7bn) in 2017.

Underlying or operating profit declined by 4.3 percent to ¤10.3bn as revenues slipped

by 0.6 percent to ¤43.2bn. Nevertheless, the bank insisted that it “got off to a good start” to its 2020 business develop-ment plan.

“In a lacklustre interest rate and market environment, the business activity of the group developed vigorously sustained by a gradually stronger European growth,” it said.

“The good overall per-formance of the operating divisions this year illustrates the promising start to the

plan,” the statement said. “The group thus confirms its 2020 targets and aims at a return on equity above 10 percent at that time.”

BNP Paribas said under its business development plan it will invest ¤3bn in accelerat-ing its digital transformation and improving operating efficiency.

Its management board proposed paying an increased dividend of ¤3.02 per share for 2017, compared with ¤2.70 for 2016.

BNP Paribas Chief Executive Officer Jean-Laurent Bonnafe (right) talks with Jacques d’Estais, bank’s Deputy Chief Operating Officer and Head of International Financial Services, after a news conference to present the bank’s ���� annual results in Paris, France, yesterday.

Toyota forecasts record net profit for full fiscal yearAFP

TOKYO: Japanese car giant Toyota yesterday revised its earnings forecast, saying it expected to see a record annual net profit thanks to a weaker yen and US tax cuts.

Japan’s top carmaker expects to bank a net profit of 2.4 trillion yen ($22bn) for the fiscal year to March 2018, up from its November estimate of 1.95 trillion yen.

Annual sales are now fore-cast at 29 trillion yen, up from an earlier projection of 28.5 tril-lion, the Prius maker said. In May, the company announced its first drop in annual profit for five years, which it blamed on the cost of customer incentives in the key US market.

Toyota said net profit rose 40.5 percent to 2.0 trillion yen for the nine months to Decem-ber, on sales of 21.8 trillion yen, which were up 8.1 percent.

Toyota officials said the profits were the result of several

factors, including a weaker yen, US tax cuts and company cost-cutting measures.

“In the US, the corporate tax cuts of 2017 resulted in a reduc-tion in income taxes of 291 billion yen,” helping push up net income, senior managing direc-tor Masayoshi Shirayanagi told reporters.

Executive vice president Koji Kobayashi said Toyota was “seeing the benefits coming from cost reductions faster than I thought.”

Toyota said global sales for the nine months edged up slightly from a year earlier, to 7.85 million units.

Operating profit from its

domestic and European markets showed moderate gains for the three quarters.

But operating profit from North America more than halved because of a decline in sales as well as swelling incentives.

Japan’s auto industry is fac-ing uncertainty over US President Donald Trump’s drive to support US firms against for-eign imports, fanning fears of a global trade war.

Smaller rival Honda Motor on Friday nearly doubled its annual net-profit forecast to one trillion yen, citing strong growth in the sales of its cars and motor-cycles, as well as US corporate tax cuts.

For the nine months to December, Honda’s net profit jumped 82.8 percent from a year earlier to 951.6 billion yen.

Nissan is scheduled to report its nine-month results tomor-row. It has downgraded its annual operating profit forecast after a damaging inspection scandal in its domestic market.

An employee is seen working on the production line at the Toyota factory in Derby, central England, in this file photo.

British wind project draws investment heavyweights: SourcesREUTERS

LONDON/FRANKFURT: Brit-ish offshore wind project Triton Knoll has attracted the interest of several large investment funds, according to three sources familiar with the matter, in a sign of the growing competition for assets in the fast-changing sector.

German energy group Innogy, owner and developer of the planned £2bn ($2.8bn) farm off the coast of eastern England, is looking for partners to get it off the ground.

The project has drawn inter-est from a number of infrastructure and pension funds, including Australia’s Macquarie, Switzerland’s Partners Group and Denmark’s PFA Pension, the three sources told Reuters.

Innogy, Macquarie, Partners Group and PFA all declined to comment on Triton Knoll. Off-shore projects of this size typically have more than one

investor alongside the developer.

The demand for the 860-megawatt (MW) Triton Knoll is indicative of the wider interest in offshore wind projects among funds. The returns on offer - typically 6-9 percent - outstrip interest rates, while competition has been heated up by the fact the number of prof-itable new projects becoming available is declining because fewer can secure government subsidies.

New data from industry group WindEurope, provided to Reuters ahead of its publication, reflects this rising institutional investor interest, as well as the decline in the building of off-shore farms.

Infrastructure funds, pension funds and asset managers accounted for 35 percent of off-shore M&A activity in Europe in 2017, up from 27 percent in the previous year, according to the data. At the same time, spending

on new offshore capacity in Europe declined by 60 percent to ¤7.5bn ($9.3bn) last year, the first annual fall since 2012.

“There is definitely compe-tition. The larger the project, the larger the investors which look at them,” said Oldrik Verloop, head of client advisory services for real assets at Aquila Capital, which manages ¤3.6bn of renewable assets.

The wind sector is undergo-ing structural change that is altering the calculus for investors.

While returns on offer beat interest rates by a wide margin, they are still lower than the dou-ble-digit percentage returns projects yielded before govern-ments across Europe started to cut the generous subsidies that have cradled the wind power sector since its inception in the early 1990s.

Last year, auction systems were introduced which involved lower government handouts and

drove down margins for projects.The reason investment funds

remain interested lies in the long-term revenues and stable cash flows wind farms generate, much like other infrastructure projects, plus the fact that tech-nological advances are bringing down costs.

In the last decade, turbines have grown larger, with some now standing taller than the giant London Eye Ferris wheel which graces the skyline of the British capital - and even larger “megaturbines” are in the works. Bigger turbines sweep a larger area and harness more wind, cutting costs per megawatt.

“What happens now is that efficiency of projects increases, driven by the cost and size of the equipment,” said Brandon Prater, head of European private infra-structure at Partners Group.

Offshore wind power projects still cost 40 percent more than onshore and a fifth more than solar but because the

offshore sector is at an earlier stage of development, costs are expected to fall faster and fur-ther, according to McKinsey research published last year.

In Britain, the cost of energy from offshore wind has fallen by nearly a third since 2012 and the price for new offshore wind fell below that of nuclear for the first time late last year, according to figures from a power auction.

For some investors, the pres-sure on margins resulting from the shift to auctions, some of which have drawn zero-subsidy bids from project developers such as Germany’s EnBW and Denmark’s Orsted, is too high.

“Particularly German and Dutch offshore wind is not as attractive ... as the margins are low,” said Per Lekander, portfo-lio manager at London-based hedge fund Landsdowne Partners.

Some of the funds who remain interested in the sector are banking on a different source

of security when it comes to wind power projects, with so-called power purchase agreements (PPAs).

These deals, struck with cor-porate clients, can reduce investment risks because they ensure the clients buy power directly from the wind farm, giv-ing operators a guaranteed revenue stream.

“For financial investors it’s relevant to secure cash flows and a certain power price,” said Holger Kraft, partner at law firm CMS Hasche Sigle, who has advised several investors on deals in the sector, including Partners Group.

Aquila, for example, secures PPAs for part of its wind, solar and hydro projects, to give inves-tors a better incentive to fund projects.

“The objective of a PPA is for the buyer to secure renewable energy volumes at a given price for a specific period,” said Verloop.

We are just producing diamonds and stuff like marble and gran-ite at the moment. We are expecting to start gold produc-tion soon, we expect to have two or three gold mines operat-ing next year but at a small scale.

Angola produces oil just over

1.6 million BPD, providing it

with over 90% of its export revenue

Australia holds rates as inflation remains softAFP

SYDNEY: Australia’s central bank yesterday kept interest rates at a record low in its first meeting of the year, with infla-tion still soft and the outlook for household spending uncertain.

The Reserve Bank of Aus-tralia has not adjusted rates since August 2016, following a series of cuts from November 2011 that took it to 1.50 percent in a bid to boost non-mining sectors of the economy.

Governor Philip Lowe said in a statement that the current monetary policy stance was supporting economic growth.

“The low level of interest rates is continuing to support the Australian economy,” he said after the RBA board meeting. “Further progress in reducing unemployment and having inflation return to target is expected, although this progress is likely to be gradual.” The

economy has endured a bumpy exit from an unprecedented resources investment boom, but recent data has pointed to a strengthening labour market and business investment.

Even so, wages growth remains weak while household debt is high, keeping the central bank on the sidelines with econ-omists tipping a possible rate rise only later this year.

“One continuing source of uncertainty is the outlook for household consumption. House-hold incomes are growing slowly and debt levels are high,” Lowe said. “Notwithstanding the improving labour market, wage growth remains low.”

Another concern has been the strength of the Australian dollar owing to weakness in the greenback, with the RBA reiter-ating that an appreciating exchange rate could slow growth in economic activity and inflation.

25WEDNESDAY 7 FEBRUARY 2018 BUSINESS

Imports push US trade deficit to 9-year highREUTERS

WASHINGTON: The US trade deficit widened more than expected in December, hitting its highest level since 2008 as robust domestic demand pushed imports to a record high.

The Commerce Department said yesterday the trade gap increased 5.3 percent to $53.1bn. That was the highest level since October 2008 and followed a slightly upwardly revised $50.4bn shortfall in November.

Economists polled by Reu-ters had forecast the trade def-icit rising to $52bn in December after a previously reported $50.5bn in the prior month. Part of the rise in the trade gap in December reflected commodity price increases. The deficit surged 12.1 percent to $566bn in 2017, the highest since 2008. The

US-China trade deficit increased 8.1 percent to a record $375.2bn last year.

US President Donald Trump has vowed to shrink the trade gap through his “America First” trade policies, which aim to shut out more unfairly traded imports and renegotiate past US free trade agreements.

Trump has repeatedly threatened to terminate the North American Free Trade

Agreement unless the pact linking Canada, Mexico and the United States can be changed to terms more favourable to Wash-ington. And his administration has launched an investigation into China’s intellectual property practices that could lead to major new trade sanctions on Beijing.

The surge in the December trade deficit was flagged by an advanced goods trade deficit report published in late January.

When adjusted for inflation, the trade deficit increased to $68.4bn from $66.5bn in November.

The jump in the so-called real trade deficit at the end of the year puts trade on course to be a drag on gross domestic product in the first quarter. Trade sub-tracted 1.13 percentage point from GDP growth in the final three months of 2017.

The economy grew at a 2.6 percent annualized rate during that period, helping to lift growth in 2017 to 2.3 percent from 1.5 percent in 2016.

The Trump administration believes a smaller trade deficit, together with deep tax cuts, could boost annual economic growth to 3 percent on a sus-tained basis. Late in January, Trump imposed broad tariffs on imported solar panels and large washing machines, and is

considering slapping tariffs or quotas on steel and aluminum for national security reasons.

Such actions may prove politically popular with Trump’s working-class supporters, par-ticularly in states hard-hit by fac-tory closures and import com-petition. But economists say they would likely do little to change the growth trajectory of the overall trade deficit, which is tied more to macroeconomic factors. Goods imports increased 2.9 per-cent to a record $210.8bn in December. Imports of food, cap-ital and consumer goods were the highest on record in December. Imports are being driven by robust domestic demand, which grew at its quickest pace in more than three years in the fourth quarter.

The country’s import bill in December was also pushed up

by more expensive crude oil, whose average price of $52.10 per barrel was the highest since July 2015. Imports from China fell 7.6 percent.

Exports of goods increased 2.5 percent to $137.5bn in December, the highest since October 2014. Exports of capital goods hit a record high. There were also increases in exports of industrial supplies and materials. Petroleum exports increased to their highest level since August 2014. Exports are being boosted by a strengthening global economy. A weakening US dollar is also making American-made goods more competitive on the international market.

Exports to China surged 7.5 percent to a record high in December. As a result, the US-China trade deficit declined 13 percent in December.

GM reports $5.2bn loss on charge for US tax reformAFP

NEW YORK: A huge one-time charge for US tax reform pushed General Motors quar-terly earnings into the red, but the automaker said yesterday that earnings were better-than-expected when the tax hit is excluded.

GM reported a net loss of $5.2bn in the fourth quarter due to a $7.3bn non-cash charge due to remeas-urement of deferred tax assets due to US tax reform -- which other major com-panies also have had to con-tend with.

Revenues in the final quarter fell to $37.7bn, down 5.5 percent from the same period a year earlier.

The tax impact also led to an annual loss of $3.9bn, after solid profits in 2016. But GM pointed to strong sales in the US, China and South America that helped it achieve higher operating earnings compared with the fourth quarter of the prior year.

The automaker reported a dip in North American car sales overall, where the US market in 2017 retreated from the record-setting per-formance of 2016 but remained at a high level.

Car sales rose signifi-cantly in China and South America, offsetting the near complete absence of sales in Europe after the company sold its the Opel/Vauxhall brands in Europe to the PSA Group.

US tax reform has led to a number of losses among large corporations such as Goldman Sachs and Cater-pillar in the fourth quarter. Still, there is broad consensus among US companies, including GM, that tax cuts will benefit the economy long-term.

GM said last month that it expects another solid year in car sales in 2018 when it will launch revamps of best-selling vehicles such as the Chevrolet Silverado.

Pickups and other large vehicles, which have big profit margins, have become the backbone of US car sales amid a period of relatively low gasoline prices.

The automaker plans to invest $1bn in 2018 on auton-omous car technology, an increase from the $600m last year.

Excluding those items, GM’s earnings translated into $1.65 a share, better than analyst forecasts.

GM shares rose 1.3 per-cent to $40.03 after the results were announced.

COMAC to deliver first plane in 2021AFP

SINGAPORE: China’s state-owned plane-maker said yesterday it expects to deliver its first home-grown passenger jet to a customer in 2021 as the world’s second largest economy seeks to challenge the domi-nance of Boeing and Airbus.

The Commercial Aircraft Corporation of China (COMAC) plans to first target the Chinese market, before moving on to Southeast Asia and Africa, said Lu Zheng, deputy general man-ager of sales and marketing.

The C919, a COMAC-built 168-seater passenger plane, will likely be cheaper than equiva-lent models by its closest com-petitors, Lu told reporters on the sidelines of the Singapore Airshow.

The company is hopeful that it will obtain Chinese airworthi-ness certification for the plane in three to four years.

“We hope to hand over the first C919 to China Eastern Air-lines in 2021 and we will work hard for it,” Lu said. “Our main audience is the China market, but we are exploring opportunities overseas,” he added.

The narrow-body jet repre-sents nearly a decade of effort in a state-mandated drive to reduce dependence on European con-sortium Airbus and US aerospace giant Boeing.

The C919 has a range of 5,555 kilometres. The Airbus A320 at list price is $101m with a range of 6,500 kilometres, and the Boeing 737 MAX 8 has a list price of $117.1m and a range of 6,570 kilometres. The maiden

test flight of the first prototype C919 took place in May last year, and a second prototype com-pleted its first flight in December. Test results have turned out well, Lu said.

COMAC has already received 785 orders for the C919, including 34 orders from overseas, including Germany and Thailand, he said. China is a huge battle-ground for Boeing and Airbus, with Chinese travellers taking to the skies in ever-growing num-bers. The Chinese travel market is expected to surpass the United States by 2024, according to the International Air Transport Asso-ciation. But aviation analysts have said Shanghai-based COMAC has a long journey ahead before it can challenge the lock held on the market by Boeing and Airbus.

A model of the COMAC C919 single-aisle aircraft displayed at the Singapore Air Show, yesterday.

EU steel sector sees demand growth in 2018REUTERS

BRUSSELS: European steel demand is set to rise in 2018 with continued strength in most steel-using sectors, European steel association Eurofer said yesterday, while warning of a threat of rising imports.

Apparent steel consump-tion, which excludes the impact of inventory changes, is set to rise by 1.9 percent in the 28 countries of the European Union this year, the same rate as in 2017, with solid demand seen from manufacturers and in construction.

Eurofer sees consumption growth dipping to 1.4 percent in 2019.

The group said it saw a risk to exports from the rising euro, but focused more on imports.

Steel imports into the EU dipped by about 1 percent last year because of trade defence measures to counter what the bloc considers to be dumping and unfair subsidies and because Chinese prices picked up, making it less lucrative to export to Europe.

Over the year, Eurofer said, Chinese steel exports to the EU declined by 41 percent, those from Russia by 32 percent and from Ukraine by 31 percent.

However, steel imports from India were up almost 100 percent, from Indonesia more

than 100 percent and from Turkey some 64 percent higher last year.

Eurofer said the trade measures left gaps that were rapidly filled by other countries.

“We are an easy target for exporters globally to sell part of production that cannot be sold domestically,” Jeroen Vermeij, Eurofer’s economics director told a news conference ahead of the release.

Eurofer and its members are nervously awaiting US Pres-ident Donald Trump’s decision on action following a “Section 232” investigation into whether steel imports threaten national security.

Even if measures were prin-cipally targeted towards reducing excess production in China, Eurofer said it could still result in more steel exports being re-routed to Europe.

Singapore & Malaysia agree to new stock exchange trading linkBLOOMBERG

KUALA LUMPUR: Singapore and Malaysia unveiled a plan to create a trading link that allows each country’s investors to access the other’s stock market.

The news was announced by Malaysian Prime Minister Najib Razak at a Securities Com-mission conference in Kuala Lumpuryesterdayday.

The link will be established by the end of the year, he said. Singapore and Malaysia’s regu-lators and national exchanges will work on the arrangements for the system, which will con-nect markets with more than $1.2 trillion in value and about 1,600 listed companies.

The move comes just months after the closing of an earlier attempt to connect the markets, which started in 2012. While that effort failed, the suc-cess of Hong Kong’s links with exchanges in mainland China made it more pressing for bourses in Southeast Asia to establish their own regional alli-ance, said Song Seng Wun, an

economist at CIMB Private Banking in Singapore.

“Regional competition has put pressure on the exchanges,” said Song. “The two exchanges don’t want to be left behind and have investors flock elsewhere so now they’re waving a flag and saying, ‘we too will have a trading link.”’

Singapore Exchange Ltd.’s shares closed down 2 percent on Tuesday, while Bursa Malaysia Bhd. stock fell 1.1 percent amid a sell-off in global equities.

A rise in trading flows under the Hong Kong-China stock con-nect demonstrates the potential opportunity for regional exchanges, said Bloomberg Intelligence senior industry ana-lyst Sharnie Wong.

The announcement came after bilateral discussions between Najib and Singapore Prime Minister Lee Hsien Loong at a retreat last month. It’s the latest move in what’s been a long-running effort to introduce cross-border trading between the two countries separated by a causeway.

A Singaporean over-the-counter market, known as Clob, that traded billions of shares of Malaysian-based companies was in 1998 banned by Malaysia, which alleged that Clob was an illegal exchange.

The Clob dispute didn’t stop the nations holding talks in 2004 about allowing investors to trade securities on each other’s exchanges by the end of 2005. While that didn’t happen, the Asean Trading Link started in 2012, with Bursa Malaysia and SGX as its members, later joined by the Stock Exchange of Thai-land. That system shut last year, five years after its high-profile debut. As well as the cross-border buying and selling of shares, the new stock link will cover arrangements including clearing and settlement, a first for the two markets, according to SGX.

The new link’s cross-border clearing and settlement will be key for its users, Malaysia’s Secu-rities Commission Chairman Ranjit Singh said in an interview.

“Investors will essentially be able to trade equities from another stock market, and settle in local currency as if trading in the local market,” he said at the event in Kuala Lumpur. “Retail investors will notably benefit from this.” Institutional inves-tors will also be interested, said Danny Wong, chief executive officer at Areca Capital Sdn. in

Kuala Lumpur. “Once the link is there, it would encourage a lot of cross-border research reports, and in this case the exchange of information would be easier.”

“We hope to cover more on the small- and mid-caps. With this kind of trading link we hope to expand into more undiscov-ered gems in the market,” he said.

Electronic display boards showing global stock market indicies at the stock exchange in Kuala Lumpur, Malaysia, in this file picture.

The deficit surged 12.1% to $566bn in 2017, the highest since 2008. The US-China trade deficit increased 8.1% to a record $375.2bn last year.

The December trade gap

increased 5.3%to $53.1bn.

Over the year, Eurofer said, Chinese steel exports to the EU declined by 41%, those from Russia by 32% and from Ukraine by 31%.

26 WEDNESDAY 7 FEBRUARY 2018BUSINESS

QATAR STOCK EXCHANGE

QE Index 8,651.48 2.11 %

QE Total Return Index 14,508.03 2.11 %

QE Al Rayan Islamic Index - Price 2,255.72 1.29 %

QE Al Rayan Islamic Index 3,483.38 1.11 %

QE All Share Index 2,410.41 2.73 %

QE All Share Banks &

Financial Services 2,702.36 2.40 %

QE All Share Industrials 2,646.44 1.78 %

QE All Share Transportation 1,844.13 1.82 %

QE All Share Real Estate 1,731.91 5.03 %

QE All Share Insurance 3,116.41 5.19 %

QE All Share Telecoms 987.14 3.07 %

QE All Share Consumer

Goods & Services 5,299.36 0.51 %

QE INDICES SUMMARY QE MARKET SUMMARY COMPARISON WORLD STOCK INDICES

GOLD AND SILVER

06-02-2018Index 8,651.48

Change 186.17

% 2.11

YTD% 1.50

Volume 12,791,433

Value (QAR) 296,826,578.61

Trades 5,280

Up 8 | Down 34 | Unchanged 005-02-2018Index 8,837.65

Change 121.65

% 1.36

YTD% 3.69

Volume 9,815,783

Value (QAR) 271,541,973.77

Trades 4,582

EXCHANGE RATE

GOLD QR157.6331 per grammeSILVER QR1.9782 per gramme

Index Day’s Close Pt Chg % Chg Year High Year Low

All Ordinaries 5930.2 -198.2 -3.23 6256.5 6103.9

Cac 40 Index/D 5181.82 -104.01 -1.97 5567.03 5258.66

Dj Indu Average 24345.75 -1175.21 -4.6 26616.71 20002.81

Hang Seng Inde/D 30595.42 -1649.8 -5.12 33484.08 30028.29

Iseq Overall/D 6639.37 -115.37 -1.71 7257.41 6720.4

Kse 100 Inx/D 43885.51 -415.69 -0.94 45494.52 40169.62

S&P 500 Index/D 2648.94 -113.19 -4.097924 2872.87 2682.36

Currency Buying SellingUS$ QR 3.6305 QR 3.6500

UK QR 5.0492 QR 5.1204

Euro QR 4.4892 QR 4.5526

CA$ QR 2.8786 QR 2.9353

Swiss Fr QR 3.8741 QR 3.9293

Yen QR 0.03311 QR 0.03375

Aus$ QR 2.8385 QR 2.8947

Ind Re QR 0.0562 QR 0.0573

Pak Re QR 0.0325 QR 0.0333

Peso QR 0.0701 QR 0.0715

SL Re QR 0.0233 QR 0.0238

Taka QR 0.0433 QR 0.0442

Nep Re QR 0.0351 QR 0.0358

SA Rand QR 0.2985 QR 0.3046

INTERNATIONAL MARKETS - A LIST OF SHARES FROM THE WORLD

Aarti Drugs-B/D 609.55 22.5 1771

Aban Offs-A/D 180.15 -10.7 331532

Acc Ltd-A/D 1619 -24.85 14117

Ador Welding-B/D 410.8 -23.6 5616

Aegis Logis-A/D 265.2 9.05 55117

Alembic-B/D 58.6 -2.2 324110

Alkyl Amines-B/D 617 -24.65 6407

Alok Indus-T/D 3.42 -0.13 1288231

Apollo Tyre-A/D 248.45 -3.75 435954

Asahi I Glass-/D 336 -13.5 378307

Ashok Leyland-/D 126.85 -2.6 2246848

Bajaj Hold-A/D 2601.1 -117.45 4016

Ballarpur In-B/D 14.6 -0.15 921066

Banaras Bead-T/D 60.45 -0.95 1588

Bata India-A/D 683.15 -10.55 31996

Beml Ltd-A/D 1205.05 -57.45 60411

Bhansali Eng-B/D 159.05 -8.35 474808

Bharat Bijle-B/D 1320.05 -1.65 13150

Bharat Ele-A/D 149 -1 1377354

Bharat Heavy-A/D 92.15 -2.55 1405581

Bharatgears-B/D 182.2 -9.2 53446

Bhartiya Int-B/D 445 5.15 1379

Bom.Burmah-X/D 1295 -16.6 32074

Bombay Dyeing-/D 230.8 8.4 2375583

Camph.& All-X/D 1010 -17.5 6708

Canfin Homes-A/D 456.8 -1.75 214179

Caprihans-X/D 96.5 0.65 11359

Castrol India-/D 179.6 -1.4 828199

Century Enka-B/D 318.2 5.95 23921

Century Text-A/D 1262.05 11.9 150113

Chambal Fert-A/D 141.2 -1.05 71699

Chola Invest-A/D 1282.1 9.1 11736

Chowgule St-Xt/D 14.15 -0.38 14712

Cimmco-T/D 96.6 -4.85 12189

Cipla-A/D 565.65 -14.45 650242

City Union Bk-/D 154.25 -2.8 37404

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LONDON

Late last year, the Department of Labor proposed an important and controversial federal regulation without a serious analysis of its costs and benefits, and of its likely

effects on low-income American workers. That’s a big mistake, a disservice to the public and a bad precedent. It might cause legal trouble as well.

The absence of such an analysis, including numbers, is inconsistent with decades of practice supported by both Republican and Democratic presidents. Under a series of executive orders starting with President Ronald Reagan and most recently reaffirmed by President Donald Trump, presidents have required all executive agencies to accompany “major” rules with a “regulatory impact analysis.” That analysis must quantify the costs and benefits of both proposed and final regulations.

At least as much as their Democratic counterparts, Republican presidents have insisted that the Office of Information and Regulatory Affairs

should oversee the regulatory process to ensure that potential costs and benefits are revealed to the public.

That’s important. Regulations usually shouldn’t go forward unless the benefits justify the costs. Cost-benefit analysis isn’t perfect, but it’s the best method we have for assessing the consequences of what the government is proposing to do. Without a catalog of anticipated costs and benefits, we can’t know whether a regulation is likely to help people or hurt them.

Clear presentation of anticipated consequences, for

public scrutiny and review, can also help correct mistakes - and show an agency that it ought to consider different solutions to a problem (and possibly no regulation at all).

Finally, analysis of costs and benefits can reduce the influence of political dogmas, unreliable intuitions and interest-group power. If an agency is required to assess the actual effects of its proposals, and show that on balance they are good, everything else starts to look less relevant. The government’s attention is focused on the right questions.

I was privileged to serve as administrator of the Office of Information and Regulatory Affairs from 2009 to 2012, and I saw, close up, the immense importance of cost-benefit analysis to democratic accountability. The obligation to produce some kind of cost-benefit analysis is a crucial safeguard.

This brings us to the Department of Labor, which has proposed to rescind a 2011 regulation that requires tips to be treated as the property of employees who receive them. Under the 2011 rule, employers may not direct employees to turn over their tips. The new proposal would eliminate that prohibition. Among other things, it would allow employers to require “tip pooling arrangements” in which, for example, waiters and waitresses would have to share their tips with kitchen workers. No one should deny that the Trump administration may reconsider previous regulations. It deserves great credit for its effort to cut regulatory costs. But the tipping proposal came without sufficient analysis of its effects. Would workers end up losing a lot of money on balance? Would employers end up taking significant amounts of the tips?

US labour rules shouldn’t be changed without probing impact

Stock sell-off overdue, investors lick their wounds and hunt

CASS R SUNSTEIN BLOOMBERG

SINÉAD CAREW

REUTERS

IT had been a long time coming. The speed of Monday’s jaw-dropping sell-off on Wall Street had traders and investors

bumped and bruised. But few seemed surprised that a pullback had actually happened. Some were looking for the right time and opportunity to wade back in - but wary of catching a falling knife.

“We finally got the correction we were all kind of figuring would happen,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. “It feels a lot more painful only because we haven’t

seen it in 14-15 months or so, and it’s certainly, from the way we look at it, healthy.”

Stocks have been on a bull run since 2009, accelerated in the last year by strong earnings and the Trump administration’s corporate tax cut. The S&P 500 rose 19 percent in 2017 alone.

But with valuations sky high after the buying binge

carried deep into January, something had to give. The down days started last week. The shakeout accelerated on Friday, with the S&P’s biggest drop since September 2016 after jobs data

raised the specter of inflation and spooked investors.

Monday started out in the red, but calm. The afternoon was anything but, as frantic selling set in.

“The market panicked for whatever reason,” said Phil Orlando, chief equity strategist at Federated Investors in New York said in the afternoon. “The sharp reversals you saw in the last hour or so is recognition of the fact that things got overdone.”

The Dow briefly entered correction territory on Monday with a 10 percent dip from its Jan. 26 record. It ended down 4.6 percent on the day, while the S&P 500 fell 4 percent.

Since the S&P’s January 26 all-time high it has fallen 7.8 percent. Of its 11 sectors, energy led the decline with a 10.5 percent drop followed by a 9.4 percent drop in healthcare and an 8.8 percent drop in materials. The best performer was utilities with a decline of just under 4 percent (3.97) followed by real estate which fell 5.1 percent and telecom, which fell 5.5 percent. After the close of trading, equity futures traded sharply down, indicating another day of selling was ahead.

“If I were running a hedge fund, I wouldn’t be rushing to buy; I’d be waiting,” said Michael Purves, chief global strategist at Weeden & Co in New York.

No S&P sector looked like a safe bet in the current environment.

“I have a strong feeling that this sell-off is going to intensify because bears are seeing blood on the Street and all they want is right in front of them,” Naeem Aslam, chief market analyst at ThinkMarkets, London

Even so, some investors went shopping as they kept their focus on strong economic data and earnings growth.

The utilities and real estate indexes performed better than the S&P on Monday, but with declines of 1.7 percent and 2.7 percent, the traditionally defensive sectors could hardly be called safe havens.

These are considered bond proxies, and along with consumer staples and telecommunications, are seen as relatively safe in even the dourest markets due to their high dividend yields and predictable if slow growing earnings.

But with interest rates rising, the dividend yields look less competitive compared with bond yields.

That leaves some strategists talking up cyclical sectors such as financials, industrials, materials and technology as beneficiaries of a strong economy.

“Right now there’s no safe place to hide,” said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York.

However Pavlik said he bought stocks on Friday, and on Monday as he was banking on a continuation of strong economic growth and a rapid increase in U.S. earnings.

“This is not going to be a protracted sell-off. This is going to happen relatively quick because the economic numbers are still so good,” he said.

Since the S&P’s financial sector fell 5 percent on Monday, some investors said they saw the decline as a buying opportunity as bank profits are boosted by rising interest rates because they can charge customers more for borrowing money. “You have a great opportunity to buy financials here,” said Phil Blancato, CEO of Ladenburg Thalmann Asset Management in New York. “With a strengthening consumer that’s going to continue to borrow and spend your best opportunity is in financials and technology.”

SOME of the biggest US investors believe the bond market has slipped into a bear phase. Others

believe it has turned into one of the best buying opportunities in years.

Pimco, one of the world’s largest bond fund managers, and widely followed Guggenheim Partners are among the investors who say benchmark 10-year Treasuries yielding 3 percent - now within reach - are too hard to resist. Other players, such as Wall Street bond king Jeffrey Gundlach, see a lot more selling pressure to come.

“Valuations are beginning to look more interesting,” said Dan Ivascyn, group chief investment officer at Newport Beach, California-based Pacific

Investment Management Co, known as Pimco, which oversees more than $1.75 trillion in assets. “We can see some further weakness in rates, especially the first half of year. But we still see limited upside for yields from here.”

Scott Minerd, global chief investment officer at Guggenheim, who helps oversee more than $260bn in assets, agreed. “We’re waiting for 3 percent,” he said. “We definitely will add there. No one will perfectly time the bottom.”

Investors have already pounced on bonds even below the 3 percent level.

On Monday, investors rushed into Treasuries as the S&P 500 and Dow Jones Industrial Average nosedived more than 4 percent - reversing a move on Friday when a spike in bond yields,

which move inversely to prices, triggered an equity rout. The yield on the benchmark 10-year Treasury ended the session at 2.71 percent, down dramatically from 2.852 percent on Friday, the highest level since January 2014.

Some investors doubt the flight to safety into Treasuries will be long-lasting: Inflationary fears, strong economic data and an announcement of bigger Treasury auctions have and will continue to drive yields higher, they say.

Indeed, the 10-year Treasury yield hit a four-year high on Friday after the latest monthly US jobs report showed solid wage gains, effectively confirming an expected rate increase at the Federal Reserve’s next meeting, in March.

Investors have been

bracing for such moves in Treasuries.

Yields in the $14 trillion market for US government debt touched record lows in 2016, driven by years of aggressive central bank intervention in the wake of the 2008-2009 financial crisis to keep interest rates low to stimulate the economy.

Now, as the Federal Reserve is expected to raise interest rates three times this year and as some economists predict that the European Central Bank will start to raise rates later this year, investors are grappling with the effects of prolonged rising rates for the first time in nearly 10 years.

With inflationary pressures and massive budget deficits having become the topic du jour this year, the bond-market “vigilantes” term has made its way back onto trading floors.

The term “bond vigilantes” was coined by Ed Yardeni, the longtime Wall Street strategist now president at his namesake research firm. Yardeni was describing the demand by investors in the 1980s for high yields to compensate for the perceived risks of inflation and budget deficits.

All told, the jump in Treasury yields has yet to make its way into the broader economy in the form of higher borrowing costs, yet it will likely start to dampen the housing and auto markets as consumer loans become more expensive, said Gary Cloud, a portfolio manager of the Hennessy Equity and Income Fund. That, in turn, will make it less likely that the Fed raises rates more than three times this year, he said.

“We’re not haters of the bond market here at all.

Bond bears smell blood, others claw for buying opportunityDAVID RANDALL

REUTERS

Office of Information and Regulatory Affairs should oversee the regulatory process to ensure that potential costs and benefits are revealed to the public.

Stocks have been on a bull run since 2009, accelerated in the last year by strong earnings and the Trump administration’s corporate tax cut. The S&P 500 rose 19 percent in 2017 alone.

Pimco, one of the world’s largest bond fund managers, and widely followed Guggenheim Partners are among the investors who say benchmark 10-year Treasuries yielding 3 percent - now within reach - are too hard to resist.

27WEDNESDAY 7 FEBRUARY 2018 BUSINESS VIEWS

A file photo of traders working on the floor of the New York Stock Exchange .

28 WEDNESDAY 7 FEBRUARY 2018

INsightback to BUSINESS

CAPITALCOMMENT

Therei is a strong case for authorities to rein in digital currencies because of their

links to the established financial system.

Agustin Carstens, General Manager, Bank for International Settlements.

NAME IN THE MARKET: WHERE PEOPLE WORK FOR LONGEST HOURS

The IndAS -- based on the IFRS9 standards created in the aftermath of the financial crisis -- would require banks to make provisions for expected bad loans instead of the current system where they only cover actual losses incurred.

New SpaceX set for test launch REUTERS

CAPE CANAVERAL, Fla: A new SpaceX jumbo rocket in line to become the world’s most powerful launch vehicle in operation was set for its highly anticipated debut test flight on Tuesday from Florida, carrying a Tesla Roadster as a mock payload.

Liftoff of the 23-story-tall Falcon Heavy was slated for as early as 1.30pm (1830 GMT) at the Kennedy Space Center in Cape Canaveral in what would be a key turning point for Sili-con Valley billionaire entrepreneur Elon Musk’s pri-vately owned Space Exploration Technologies.

Getting the rocket off the ground would likely give Cali-fornia-based SpaceX a new edge on the handful of com-mercial rocket companies vying for lucrative contracts with NASA, satellite companies and the US military.

Propelled by 27 rocket

engines, the Falcon Heavy packs more than 5 million pounds of thrust at launch, roughly three times the force of the Falcon 9 booster that until now has been the work-horse of the SpaceX fleet.

The new heavy-lift rocket is essentially constructed from three Falcon 9s har-nessed together side-by-side, and Musk has said that one of the most critical points of the flight will come as the two

side boosters separate from the central rocket in the first few minutes after blastoff.

“It’s going to be an excit-ing success or an exciting failure,” Musk said on a con-ference call on Monday.

Going along for the ride in a bit of playful cross-promo-tional space theater will be a cherry red, electric-powered sports car from the assembly line of Musk’s other transpor-tation enterprise, Tesla Inc.

The sleek Tesla Roadster is supposed to be sent into a virtually indefinite solar orbit, on a path taking it as far from Earth as Mars. Adding to the whimsy, SpaceX has planted a space-suited mannequin in the driver’s seat of the convertible.

If the demonstration flight succeeds, Falcon Heavy will rank as the world’s most powerful existing rocket, with more lift capacity than any U.S. space vehicle since the era of NASA’s Saturn 5 rockets that took astronauts to the

moon some 45 years ago.Fittingly perhaps, the

SpaceX rocket will depart from the same launch pad used for the Saturn 5 until its final mission in 1973.

Falcon Heavy is designed to place up to 70 tons into standard low-Earth orbit at a cost of $90 million per launch. That is twice the lift capacity of the biggest exist-ing rocket in America’s space fleet - the Delta 4 Heavy of rival United Launch Alliance (ULA), a partnership of Lock-heed Martin Corp and Boeing Co - for about a fourth the cost.

Like the Falcon 9, Falcon Heavy is built to capitalize on cost-cutting reusable rocket technology, with each of the three main-stage boosters designed to fly back to Earth after launch. The two side-boosters are supposed to touch down on landing pads at Cape Canaveral, while the central booster should land on a drone ship at sea.

$30bn hit looms for India banks on new accounting ruleLOOMBERG/ MUMBAI

India’s lenders, already struggling with $210 billion of stressed assets, may have to prepare for another hit as early as the coming financial year if new

accounting norms kick in as planned on April 1. The IndAS -- based on the IFRS9 standards created

in the aftermath of the financial crisis -- would require banks to make provisions for expected bad loans instead of the current system where they only cover actual losses incurred. CLSA estimates that would almost double stressed advances, boost provisioning by $30 billion and consume more than $26 billion in capital at state-run banks and $4BN for private lenders.

“The new Indian accounting standards could result in sizable incremental bad debt provisioning require-ments for Indian banks given their relatively low levels

of provision coverage at present,” said Nicholas Yap, a Hong Kong-based credit desk analyst at Nomura International (HK) Ltd. “This could pressure banks’ capital levels.”

Part of the requirement will be met by the govern-ment’s pledge to inject capital into struggling state-run banks, Yap said. However, lenders outside the ambit of this infusion would have to fend for themselves, depending on the largesse of Prime Minister Narendra Modi’s administration or left to face an increasingly hos-tile global bond market.

The government announced the recapitaliza-tion last October when loans were growing at about 7 per-cent, but the pace has since

increased to 11 percent, potentially boosting banks’ capital needs. A surge in bond yields is already pres-suring profitability at Indian banks.

Lenders’ difficulty in meeting IndAS norms may push the regulator to defer implementation, the Mint newspaper reported last month, citing officials it didn’t identify. The Reserve Bank of India didn’t answer an email seeking comment. The authority is due to decide on interest rates and announce policy developments at 2.30pm in Mumbai today.

If advances grow more than 7 percent or 8 per-cent, banks may need RS.890bn ($14bn) toward additional provisioning even after the recapitalization, India Ratings and Research estimates. Lenders need-ing cash would probably sell assets outside their core business and issue bonds that don’t have a maturity date, said Udit Kariwala, a senior analyst for financial institutions at India Ratings.

He estimates banks would need to sell 530bn of AT1 bonds -- which are riskier and therefore costlier -- through March 2019.

$1.8bn MoU to broadcast Saudi soccerDUBAI:STATE-RUN Saudi Telecom has signed a tenta-tive deal with the government’s General Sports Authority to broadcast Saudi professional soccer matches over 10 years for SAR 6.6bn ($1.8bn), the authority said yesterday.

The deal appears to take rights to broadcast Saudi soc-cer away from regional broadcaster MBC group, which in July 2014 signed a SAR4.1bn, 10-year deal to obtain them.

During the two-month period of the memorandum, a detailed agreement will be negotiated, it added. Saudi Telecom currently offers access to television channels and movies over its broad-band network.

Propelled by 27 rocket engines, the Falcon Heavy packs more than 5 million pounds of thrust at launch, roughly three times the force of the Falcon 9 booster that until now has been the workhorse of the SpaceX fleet.