National News

Impressive 16% throughput growth recorded by Visakha Container Terminal in FY 2019

VISAKHAPATNAM: With a throughput over 0.45 mn TEUs, Visakha Container Terminal (VCT) recorded 16% growth rate in FY 18-19.This city of destiny is about to witness surge in Agri Products with Indonesia planning to import more rice this fiscal year thanks to the trade for the unstinted support and continuous patronage. Rise in Pharma exports is another factor where the Vizag trade would see a growth with the units ramping up the current capacities while few are planning to set up new units. After the CONCOR issued a public notice on the stabilized tariff and no financial charges increase for 1 year, there was a breather to the trade. Safety is a continuous process at VCT & VCT CFS that is followed religiously by every VCTian. VCT & VCT CFS has observed Fire Service Week in the month of April, informed a company statement in this context.

Encouraging start-ups a Vizag port commitment

VISAKHAPATNAM: To encourage start-ups and assist in creating the right ecosystem for promoting innovation are commitments promised by the Visakhapatnam port.The commitment was made at an interactive session, organised here for local industries and start-ups.Deputy Chairman of the Vizag Port, PL Harnadh, spoke generally of the opportunities opening up in the maritime sector for start-ups, and particularly for Visakhapatnam Port, saying they would have to come up with innovative solutions for cargo-handling and cargo evacuation in ports. “We will be more than willing to support start-ups. A free trade zone is coming up in the Vizag Port and it will further encourage them,” he said.

Shipments will climb 11% say Adani, Coal imports to surge to a record in 2019

Ahmedabad: A record high is expected this year in India’s thermal coal purchases which will remain robust through the next decade as domestic supply lags demand, according to the country’s largest importer. According Vinay Prakash, Chief Executive Officer for coal and mining at Adani Enterprises Ltd., during the financial year started April 1, overseas shipments will climb almost 11% to 184 mn metric tonnes and rise further to average about 200 mn tonnes annually through the following decade. He said recently, that while consumers close to the coast are also likely to favour imports due to the higher cost of railing domestic supply to their operations, generators designed to run on imported coal will keep fueling demand.

Surge in India’s grape exports to Europe by 31%

Pune : The grape export season of 2018-19 ended in India with a 31 % rise in export of the fruit to Europe, the most premium market. An increase of about 25 % to 30 % is expected in exports to Russia, China and other destinations.India’s grape exports rose from 92,286 tonnes in 2017-18 says to Agricultural and Processed Foods Development Agency (Apeda) to 1,21,469 tonnes in 2018-19. Around 90 % of India’s grape exports to Europe are accounted for by the Netherlands, UK and Germany. Though the year-on year rate of growth had declined in that year, India had exported grapes worth Rs 1,900 crore to Europe in 2017-18.Though Apeda is yet to compile data about the export of grapes to Russia and other destinations, Jagannath Khapre, President, All India Grape Exporters Association said, “We believe that the export of grapes to Russia and other countries must have increased by 25 % to 30 %.” India has acquired closed to 70 % of the market share of white grapes in Europe for the March to May period, with one of the longest harvest seasons that spans from October to May. Good quality coloured varieties, which have more demand in the international markets, and the exporters are now trying hard to get access it.

PHD Chamber: By 2020 India-USA bilateral trade in goods likely to cross USD 100 bn

New Delhi:Mr Rajeev Talwar, President, PHD Chamber of Commerce and Industry in a press statement issued recently said that India’s bilateral trade in goods with USA is likely to cross USD 100 bn by 2020 from the current level of USD 85 bn in 2018.In the coming times, the attraction for trade in goods between India and USA is gaining momentum in the recent years and is expected to grow stronger, said Mr Rajeev Talwar. The share of USA in India’s bilateral trade in goods has increased from 9% in 2017 to 10% in 2018 whereas India’s exports with USA grew by 13% and India’s imports from USA grew by 38% in 2018.India’s bilateral trade in goods with USA is growing rapidly from 2% in 2016, 13% in 2017 and 21% in 2018. Further, Mr Talwar said the volume of trade with USA has also increased significantly from USD 62 bn in 2016, USD 70 bn in 2017 and to USD 85 bn in 2018, the bilateral trade between the largest economy, USA, and the fastest growing economy, India, is expected to touch new highs at US $ 125 bn by 2022.During the recent years India’s exports to USA are mainly items of precious or semiprecious stones, pharmaceutical products, nuclear reactors, boilers & mechanical appliances, mineral fuels & mineral oils, articles of apparel and clothing accessories, vehicles other than railway, among others. On the other hand, the principal items of India’s imports from USA during the recent years are nuclear reactors, boilers & mechanical appliances, mineral fuels & mineral oils, precious or semiprecious stones, aircraft & spacecraft, electrical machinery and equipment, optical and photographic cinematographic measuring, organic chemicals, among others.Mr Rajeev Talwar said, going ahead, as India is the fastest growing economy in the world economic system with an expanding middle class, the demand in the country remains intact.

In next four years CONCOR to invest INR 4,500 cr. to add 270 rakes

Chennai:A report says, , the Container Corporation of India (CONCOR) intends investing Rs 4,500 crore in the next four years to add 270 rakes to its existing fleet of 343 rakes.Interacting with media recently, Mr V. Kalyana Rama, Chairman and Managing Director, CONCOR, said, “This year, CONCOR plans to invest Rs 1,000 crore on infrastructure, dry ports and IT systems.”Exploring the use of containers to transport break-bulk cargoes like cement and foodgrains is also planed by the company s. “The use of containers for cargo movement within the domestic market is still minuscule,” he added.Besides, it was pointed out after testing coastal shipping from Deendayal Port to VOC Port via New Mangalore Port and Cochin Port, CONCOR wants to extend this up to Bangladesh, which can also be serviced under coastal shipping. Bangladesh has a huge demand for materials like clinker and cement. “You will shortly hear about the Bangladesh service,” Mr Kalyana Rama said. In 2018-19, CONCOR registered a net profit of Rs 1,200 crore handling 3.83 mn TEUs across its 83 terminals. As per the report Mr Kalyana Rama said, it expects 10-12 % growth in both volume and top line in the current fiscal.

Expected rise in seafood exports to US

Kochi:India’s seafood products are likely to have a competitive edge in the US market after the imposition of an additional tariff of 25 % on Chinese imports by the Trump administration.As per a report already India has a dominant position in the shrimp market in the US which can be fully exploited to garner a significant share in value-added seafood products, an exporter opined.

6.6% rise in India’s services exports to reach $17.94 bn in March

Mumbai:According to the data released by the Reserve Bank India’s services exports rose by 6.6 % to USD 17.94 bn in March. Growth in services imports of 10.55 % to USD 11.37 bn in March too. With a lag of 45 days in data, the trade balance in services for the month under review is estimated at USD 6.58 bn. It is also provisional and undergoes revision when the Balance of Payments (BoP) data is released on a quarterly basis. The Government is taking steps to promote the growth of exports services sector accounts for over 55 % in the country’s GDP. A Rs 5,000 crore package to promote 12 champion services sectors such as IT, tourism and hospitality was approved last year by the Government.

US-China trade conflict to benefit Indian textile exporters

New Delhi:As part of the on-going trade conflict between the two countries, textile exporters in India are optimistic that the additional tariff of 25 % imposed by the US on China has opened up opportunities to increase their share in the American market.The list of notified $ 200 bn imports from China on which additional tariff imposed by the US places Indian textile exporters at an advantageous position, as per a recent analysis done by the Confederation of Indian Textile Industry (CITI).Enough scope to exporters in India will be provided even if out of the $200 bn of imports from China, textile items comprise just $ 3.9 bn of the value. “The US’ total import of these textile products from India was approximately $ 1.71 bn in 2018, which is 43 % of its imports from China. Out of the total textile products, cotton textiles account for the largest number of tariff-lines. In terms of value, the most imported products belong to floor coverings, non-woven cordage and man-made filaments,” said Sanjay Jain, Chairman, CITI.

Maruti cars eyed by Indian Railways o boost freight business by 2030

New Delhi:At least half of India’s largest carmaker Maruti Suzuki (MSIL) cars are likely to be transported via Indian Railways by 2030.“MSIL has drawn up a plan, based on which at least 50 % of its cars will be transported through the railways,” said a Senior Government official.Several rounds of meetings with various industry stakeholders have already been conducted by the national transporter. It is laying big bets on the automobile industry to increase its freight share by the end of the next decade. “For the last four years, we were trying to use the railways more as a transportation medium. For that, we were pushing for more rail sidings, for easier loading and unloading,” said R C Bhargava, Chairman of MSIL.Last year the railways had liberalised automobile freight train operator (AFTO) policy to encourage more private investment in special wagons, the railways official added in order to attract more interest from automobile majors. The registration fees for AFTO scheme was reduced from Rs 5 crore to Rs 3 crore, and a condition of a minimum procurement of three rakes under the scheme was also relaxed to one rake.“A few service providers, including APL Vascor and Adani Logistics, too, have got licences for automobile transport. We expect more players to come under the AFTO scheme,” he said. While authorities are planning to set up more, around 28 routes have been notified for operation of bi-level auto car wagons by the railways rakesa at present. Already, rail auto hubs are functional in Walajabad (Southern Railway) and Farukhnagar (Northern Railway).

In a major boost for Indian Importers a new product has been added by Cogopor

Mumbai:To now accommodate imports from Asia in a boost for customers across the country Cogoport, India’s leading digital freight logistics business, has announced a major expansion of services. Cogoport has now added a wide-selection of services for Asian route into India – beginning with ports from China and to be followed by others across the Asia region.Major Ports across the globe associate Cogoport as the leading digital platform for Indian customers to and it is now offering competitive freight rates for bookings of import containers across major shipping lines. Cogoport’s growing customer base, which already includes more than 10,000 shippers with import requirements will get further impetus thanks to this announcement. Purnendu Shekhar, founder and CEO of Cogoport says: “Our customers tell us that Cogoport is already saving them between 10-15% on their logistics costs and around 40-man hours per booking for export shipments. With the launch of this imports product, a natural second phase progression for our digital platform, we are meeting demand from importers who can now harness our technology for an efficient, cost-effective and transparent freight shipping process. With just a couple of clicks importers can now benefit from an immediate choice of comparative prices from a range of premium shipping lines on our Cogoport platform, and at the same time be rewarded for being partners in this digital transformation.” There has been a huge demand for inbound shipment services, notably from China into India, and Cogoport says it can now also satisfy significant demand for those cargo shipments, with other points soon to follow across Asia. Launched in 2017, the Cogoport digital logistics marketplace was and has been growing at 25% per month by removing the traditional, lengthy and cumbersome offline quotation and booking process. With a choice of providers on port pairs, dedicated back-end booking confirmation and seamless shipment tracking, it uses ground-breaking technology, algorithms and analytics to enable its users to move freight faster and more efficiently.Cogoport has already attracted more than 25,000 registered exporters and importers, largely but not exclusively small and medium-size enterprises (SMEs), with pricing from over 40 major international shipping line partners in less than two years. It also works with more than 40 non-vessel operating common carriers (NVOCCs) and 300 freight forwarders.Faster decision-making, transparent pricing and lower shipping costs not only benefits users but also automatically earn rewards on future shipments and from 90+ brand partners.

Growth opportunities seen in industrial warehousing hubs for foreign investors: ICRA

Mumbai: Rapid growth in recent years due to healthy demand from occupants has been witnessed in sectors such as automotive manufacturing, third party logistics services and e-commerce in the industrial warehousing segment. In addition, regulatory interventions such as implementation of the GST and infrastructure status accorded to the sector are also driving demand for large integrated warehousing parks. Foreign investors who are entering the sector through investment platforms are attracted with the mandate of investing in industrial warehousing parks across the major cities of the country as per ICRA. Many times, this is done by partnering with a local developer or in some cases a global warehousing operator. Over the last two years the total amount of equity commitments to such platforms is at least USD2.5 bn.ICRA estimates that such investment commitments can support assets under management of more than 130 mn square feet, which is almost double the size of the current estimated stock of Grade A industrial warehousing in the country and around 10 times the operational portfolio of such platforms as on date. Commenting on the development, Mr. Shubham Jain, Vice President and Group Head – Corporate Ratings, ICRA says: “There is increasing demand for Grade A warehousing space because of the operational conveniences and cost benefits. The demand is concentrated on the metro cities, supported by the presence of manufacturing hubs in the vicinity, access to transport networks and Export Import facilities, as well as the rising urban population in the metropolitan areas for consumption-driven demand for warehousing. The current incremental capacity addition is mainly through larger-sized warehousing parks, backed by capital from foreign institutional investors and collaboration on best practices with global warehousing operators.” Foreign investment is largely flowing in by partnering with a local developer or in some cases a global warehousing operator notes ICRA. Some of the major investors in this space till date include the Canadian Pension Plan Investment Board (in Indospace Core), GLP (in Indospace Core), Allianz (in ESR India), Warburg Pincus (in Embassy Industrial Parks), Ascendas-Singbridge (in partnership with Firstspace Realty) and Ivanhoe Cambridge and Quadreal Property (in LOGOS India). The existing and potential assets are primarily located in the cities of Mumbai, Delhi-NCR, Chennai, Kolkata, Pune, Bengaluru, Hyderabad and Ahmedabad.

Retaliatory tariff deadline on US products by India postponed to Jun 16

New Delhi: The deadline to impose retaliatory import duties on 29 US products, including almond, walnut and pulses, by the Government has again been extended till June 16. A notification of the Finance Ministry this year said that implementation of increased customs duty on specified imports originating in the US has been postponed from May 16 to June 16. Since June 2018 these deadlines were extended several times when India decided to impose these duties in retaliation to a move by the US to impose high customs duties on certain steel and aluminium products. The US decision to withdraw export incentives being provided to Indian exporters under Generalised System of Preferences (GSP) programme, which is expected to impact India’s exports to the US worth USD 5.6 bn under this scheme has brought this extension. The 60 days notice given by America, ended on May 2 but is yet to withdraw those benefits. Meanwhile, a bilateral meetings was held here on May 6 here US Commerce Secretary Wilbur Ross and Commerce Minister Suresh Prabhu. Further while extension of GSP benefits was part of a trade package being negotiated between the two countries, these negotiations hit a roadblock after the US announced its decision to roll back GSP benefits from Indian exporters.

Duty benefits on Indian exports extended by US until next Govt is formed

New Delhi:The US has finally agreed to extend trade benefits to India under the Generalised System of Preferences (GSP) Programme till the formation of a new Government in New Delhi and finalization of a new trade package with it, sources have told.The Office of the US Trade Representative (USTR) informed of the decision to not withdraw the GSP benefits from India by over the weekend. The deadline to withdraw the GSP benefits was 4 May. “The GSP review is on hold for now…This is the result of some adroit diplomacy on our part from the Ministry of External Affairs, Commerce, PMO and the Indian mission there (in US),” a top Indian official involved in the talks told.The official also added that GSP benefits had been extended “long enough for India to revert after elections and engage with the US side”.

Flat growth in exports in April 2019 amid global trade tension

New Delhi:As gold imports surged more than 50% while merchandise exports lost the growth momentum of March, India’s trade deficit in April expanded to a five-month high of $15.3 bn amid rising trade tensions between China and the US.After a double-digit growth in March, data released by the Commerce Ministry showed growth in exports slowed to a four-month low of 0.64% in April while imports grew 4.5%. In 2018-19, India’s exports grew 9.1% to $331 bn while imports grew 9% to $507.4 bn, causing a trade deficit of $176.4 bn. As the trade war with the US escalated China’s merchandise exports contracted 2.7% in April, while imports grew 4%.India’s exports picked up in drugs and pharmaceuticals (4%), chemicals (15.1%), readymade garments (4.4%) and petroleum products (30.8%), while they contracted in gems and jewellery (-13.4%) and engineering goods (-7.1%) during April. Among major items of imports, gold (54%), petroleum products (9.3%), plastic materials (3.5%), iron and steel (11%), non-ferrous metals (1%), machinery (6.5%) and electronic goods (4%) expanded while transport equipment (-31.7%), chemicals (-0.1%) and precious stones (-8.9%) fell. The indirect financial market linkages will ensure the rupee does not remain insulated from any market chaos Madhavi Arora, Economist, Edelweiss Securities Ltd said even as India’s direct China exposure is limited. “We see India’s growth picture to remain sluggish and fiscal state to remain fragile even as balance of payments will likely be turning marginally positive in 2019-20. We maintain our view of mild rupee depreciation through the year and see rupee drifting towards 73.50 by end of calendar year 2019,” she said. “A sharp drop of over 7% in highly employment-oriented engineering exports in April is a matter for concern for Indian exporters, who are facing global headwinds like escalated trade war, geopolitical uncertainties in the Middle East and rising cost of finance and raw material at home,”Ravi Sehgal, Chairman of the Engineering Export Promotion Council, said, adding that due to the near stagnant export it is imperative for the RBI to cut the interest rates in its June credit policy review while measures like availability of raw material at reasonable prices should be ensured by the Government.

India Ratings: Trade tensions between US and China may lead to dumping of Chinese goods in India

New Delhi:Chinese goods could be dumped in emerging markets, including India and weaken the flow of foreign investment from the United States, due to the rise in US-China trade tensions, Ind-Ra said. China has showcased such tendency and dumped its products at predatory rates in many markets, including India in the past , the Indian arm of global rating agency Fitch said.”Ind-Ra believes the rise in trade tensions between the US and China could lead the latter to guide its exports towards emerging markets. This could potentially disrupt the demand-supply dynamics in the Indian domestic markets, especially for products such as electronic goods, iron and steel and organic chemicals,” it said in a statement.Out of the total US imports in 2018, Chinese exports accounted about 18 %, representing 2.34 % of the US GDP. India Ratings and Research (Ind-Ra) further said that inflationary pressures in the US could be stimulated given the substantial share of Chinese imports in comparison with the size of the US GDP, lower imports or a rise in the cost of imported goods.The report further noted that “a fall in Chinese exports to the US could potentially put downward pressures on the Chinese yuan. A likely devaluation of the yuan could stimulate a competitive depreciation in the Indian rupee, failing which the competitiveness of Indian exports could be affected. It further said that as there is a stark its June credit policy review while measures like availability of raw material at reasonable prices should be ensured by the Government.difference in the nature of commodities exported by India and China to the US, India is unlikely to benefit much from the ongoing trade frictions between the US and China.

Trade Experts: US-China trade war is a blessing in disguise for India’s exports

New Delhi:India will benefit in tappping export opportunities in both the countries in areas such as garments, agriculture, automobile and machinery, thanks to the ongoing trade war between the US and China, according to trade experts. Whereas China is targeting American automotive and agricultural products including Soybean, Professor at Indian Institute of Foreign Trade (IIFT) Rakesh Mohan Joshi said the US has broadly targeted intermediate components from China, particularly machinery and electronics.“These areas offer huge opportunities for India. Strong opportunity is unfolding for India in apparel and readymade garments as after China, India is the only Country in the world to match the scale of operations and integrate its supply chain for global customers,” Joshi said. India needs to make use of this opportunity to significantly enhance its exports especially in Information and Communications Technology (ICT) and the automotive sector, he added. “To effectively harness the emerging opportunities, India needs a carefully crafted strategy and its meticulous implementation at the grass-roots level,” he said.The trade war between the US and China is benefitting India, the Federation of Indian Export Organisations (FIEO) said, sharing similar views. FIEO President Ganesh Kumar Gupta said India’s exports to the US went up by 11.2 % in 2018, while to China it rose 31.4 % in the same year. “China is also more willing than ever before to provide better market access to India on a wide range of agriculture and processed food products. India would be getting better access to Chinese market as China would like to prove to its citizen that the tariff war has little or no impact on it,” he said.The US and China are significantly raising import duties on each others’ products, which amounts to a trade war in international commerce parlance. The US is demanding China to reduce the massive trade deficit which last year climbed to over $539 bn, recently, it increased import duties from 10 % to 25 % on $200 bn worth of Chinese imports. In the opinion of FIEO Director General Ajay Sahai, it is a “God-sent opportunity” for India to seek huge investments from companies located in China.“All investments in China with prime focus on the US market may seek relocation and India would definitely be the option. There is a need to move aggressively to woo such investors before they are allured by others,” Sahai said. India should work on tapping export opportunities in the agriculture sector in both the countries, said Assistant Professor and expert on agri economics, Chirala Shankar Rao. “Indian exporters have all the potential to increase agricultural exports in both these countries,” Rao added. Enormous opportunities are there in the engineering and machinery sector in both the countries Ludhiana-based exporter and FIEO Former President S C Ralhan said, echoing similar views, and “we have to tap that.”Council for Leather Exports Chairman P R Aqeel Ahmed said the trade war will help India increase footwear exports to the US. “India’s footwear exports to the US currently is about $300 mn and Chinese exports to the US is $11 bn. Even if we get 10 % of this, our exports to the US can grow four times,” Ahmed said. In 2017-18 India’s bilateral trade with China and the US stood at $89.71 bn and $74.5 bn, respectively.

33% decline India’s apparel exports to UAE on higher import duty

Mumbai:Over a third of its apparel and garments exports to the UAE in FY19, has been lost by India due to the 5 % import duty levied by the Gulf nation to restrict trading activity and encourage local manufacturing. “Indian exporters were using the UAE as a gateway for apparel shipment to the Middle Eastern countries, Africa and Europe. However, the UAE Government levied import tax a few months ago on all merchandised products, including apparels. On the contrary, apparel exports to the US and Europe are increasing. Therefore, the decline in apparel exports to the UAE was majorly compensated for,” said H K L Maghu, Chairman of the Cotton Textile Export Promotion Council (Texprocil).Indian exporters enjoyed a robust banking system between the UAE and African countries according to industry sources. Now, strong banking systems of their own have been developed by individual countries in Africa. “Thus, India’s direct apparel exports to African countries have improved. With this, India’s direct shipments of apparels have jumped significantly to African and European countries, at the expense of the UAE. This trend is likely to continue,” said Rahul Mehta, President of the Clothing Manufacturers Association of India (CMAI). Direct shipment to consuming countries, however, leads to lower delivery time, said Mehta.

RCEP deal may hurt India’s export competitiveness: Trade Promotion Council of India

New Delhi:TPCI said recently that the proposed Regional Comprehensive Economic Partnership (RCEP) agreement may hurt India’s export competitiveness as the trade balance is already skewed. The proposed RCEP, is a mega free trade agreement, which could lead to flooding of goods in the Indian market from the member countries; and due to this, Indian negotiators need to move with caution on this, Trade Promotion Council of India (TPCI) said. The RCEP bloc comprises 10 Association of South East Asian Nations (Asean) group members (Brunei, Cambodia, Indonesia, Malaysia, Myanmar, Singapore, Thailand, the Philippines, Laos and Vietnam) and their six FTA partners – India, China, Japan, South Korea, Australia and New Zealand. TPCI said in a statement that it is “apprehensive that the RCEP deal is expected to hurt India’s export competitiveness as the trade balance is already skewed and there will be flood of goods imports in the Indian market, with relatively little gains on the export front”. Mohit Singla who is the Council’s Chairman said India needs to move with optimism and caution on this mega trade agreement. “For India, issues of tariff rate (import duty) are as important as other areas under negotiations, mainly because India does not have trade agreements into effect with all countries involved in RCEP,” he said. For instance, he said India does not have a trade agreement with China, and the negotiations with Australia and New Zealand have not come into effect. He added that sectors like steel, pharma, e-commerce, and food processing could have a “negative impact” dueto RCEP. Singla added that India is already facing challenges from Singapore, Australia and New Zealand in agriculture and dairy sector. Citing a report of the World Integrated Trade Solution (WITS) Simulator, he said, India’s imports may increase by USD 29 bn annually during the post-RCEP period, implying a revenue loss by as much as 1.3 % of GDP. India has registered trade deficit in 2018-19 with as many as 11 RCEP member countries – including China, South Korea and Australia, out of the grouping of 16 nations that are negotiating the mega trade pact since November 2012.

Annual contracts from Cochin and Paradip Port Trust won by Dredging Corporation of India

New Delhi:Recently Dredging Corporation of India Ltd (DCI) has won the annual maintenance dredging contracts from Paradip Port Trust and Cochin Port Trust. These are the first contracts for Rs 1,049 crore in March since the central public sector undertaking was acquired by a consortium of four Major Port Trusts -Visakhapatnam Port Trust, Paradip Port Trust, Jawaharlal Nehru Port Trust and Deendayal Port Trust. After emerging the lone bidder following two rounds of tender DCI won the annual maintenance dredging contract at Cochin Port Trust for Rs 83.89 crore, a Shipping Ministry official said. After the Port Trust scrapped a tender for the work in which Mercator Ltd had emerged the lowest bidder. Mercator’s bid was rejected due to some technical reasons, the official said the annual maintenance dredging contract at Paradip Port Trust on nomination basis (without a tender) was wrested by DCI.

National Company Law Tribunal approves JNPT’s bid for Dighi Port

Mumbai:Approved has been given by the National Company Law Tribunal (NCLT) Jawaharlal Nehru Port Trust’s (JNPT) bid for beleaguered Dighi Port Ltd. Balaji Infra Projects Ltd. Of which the promoters are Infrastructure Leasing & Financial Services or IL&FS Group and Maharashtra Maritime Board (MMB) of Dighi Port Ltd. Balaji Infra Projects was awarded the project on a Build, Own, Operate, Share and Transfer basis as per 2002’s concession agreement, for a period of 50 years. The resolution plan of JNPT is more than 85% of the average liquidation value and is also higher than the average fair value arrived at by the two registered valuers, observed the NCLT’s Mumbai Bench in its judgement earlier this month. “It is also further observed that this is one rare resolution plan, wherein the plan outlay is more than the fair value,” the judgement said.Claims made by financial creditors include Rs 3,074.51 crore with Dighi Port, Rs 26.36 crore operational creditors and Rs 15.38 crore by MMB. Further, for improving port operations, Rs 190.78 crore also needed to be invested as part of equity Infusion. JNPT has been looking to expand its presence along Maharashtra’s coastline for the last few years. This move is part of its strategy to have a few smaller ports along the coast until a bigger port at Vadhavan (near Dahanu) comes up.

New Agri Export Policy in Maharashtra

Mumbai:A committee under the State Agriculture Commissioner of the Maharashtra Government has appointed to draft a new Agriculture Export Policy. Already the State is a leader in export of grapes, pomegranates and onions and the policy will focus on multiplying export of bananas, vegetables and rice.A resolution announcing appointment of the Committee, which comprises nine Government officials from various departments has been issued by the State Cooperative and Marketing Department.Development of six clusters to export oranges, pomegranates, grapes, onions, banana and mangoes is already planned by the State Government. The new policy, which aims at reinvigorating the entire value chain from export-oriented farm production and processing to transportation, infrastructure and market access, will be in consonance with the Centre’s Agriculture Export Policy.In his recent address at the first State level awareness programme on agriculture export policy held in Pune, Commerce Minister Suresh Prabhu, said that to achieve the purpose of the policy, clusters have been identified across the country for development of agriculture exports.Attractive packaging was also stressed on to increase the demand for the identified products. They have roped in the Indian Institute of Packaging to work on packaging standards for international markets.

Automated GST refund for exporters from June 2019

New Delhi:As the Revenue Department plans to introduce faceless scrutiny of refunds and faster claim settlement, exporters of goods and services as well as suppliers to SEZ units are likely to get GST refunds automatically from June, an official said. Every person making a claim of refund on account of ‘zero-rated’ supplies under GST scheme, has two options. Either he can export without payment of integrated tax under Bond/ LUT and claim a refund of accumulated Input Tax Credit (ITC) or he may export on payment of integrated tax and claim refund thereof.The facility of automatic refund is currently available only for those exporters who have paid Integrated Goods and Services Tax (IGST) while exporting goods. Refunds are generally transferred to the bank accounts of such exporters within a fortnight since the GST Network (GSTN) systems are integrated with Customs.Manufacturing exporters and suppliers to SEZ, who want to claim a refund of ITC, however, have to file an application in Form GST RFD-01A on the common portal and thereafter manually submit a print out of the form along with other documents to the jurisdictional officer.Once implemented, the time period for such refunds will come down to about a fortnight from months at present.”The revenue department and GSTN is working to make the process of seeking tax refund by all exporters faceless by next month. It would make the process faster and also help in eliminating fake refunds,” an official said recently. While GST refunds of exporters run into thousands of crores, any delay in the processing of refund claim blocks working capital of exporters. AMRG & Associates partner Rajat Mohan said based on a comprehensively integrated GSTN system a fully computerized tax refund in case of export of services would be connected with RBI servers to track the receipt of payments and link them automatically with invoice level information.”Tax refunds for inverted duty structure could also be copiously automated in future, however, it would require GSTN system to be loaded with HSN-enabled invoice level information by every vendor, so that only eligible tax credits could be processed without any human intercession” he added.

Handicraft exporters to Iran breathe easy as Govt. drops documentation requirement for export sop

New Delhi:The Government acceding to their long-pending demand to do away with the requirement for e-BRC (Bank Realisation Certificate) to get benefits under a popular export promotion scheme as banks were not being able to generate the documents for countries in the Office of Foreign Assets Control (OFAC) list, giving handicraft exporters to Iran a shot in the arm.OFAC countries are the ones against which economic sanctions have been imposed by the US and include Iran, Iraq, North Korea, Belarus, Syria and Cuba. ‘Will enhance exports’“With this initiative, the exporters are going to get the much-needed MEIS benefits for their exports and it will energise them to continue their efforts towards enhancing exports from the country,” said Rakesh Kumar from the Export Promotion Council for Handicrafts (EPCH). The matter of non-issuance of e-BRC had been taken up by the council at the highest level in all concerned Ministries including Textiles, Commerce, Finance and also the DGFT and finally action was taken, he pointed out.

China News

April sees surges in coastal bulk freight index of China

Shanghai:Last month saw an overall demand growth in China’s coastal bulk freight market according to the Shanghai Shipping Exchange (SSE), The composite index for coastal bulk freight rose to 1,037.4 in April, up 4.5 % from a month earlier, the SSE said.Since 2018 till the beginning of 2019, the index had averaged 1,004.15, down from an average of 1,149.05. Last month, the sub-index for coal saw the strongest rally of 5.6 % to stand at 1,066.51, followed by grain and metal ore. The sub-index for crude oil remained flat in April.The index initiated in 2001 by the SSE under the guidance of the Ministry of Transport to reflect the fluctuation in the Chinese coastal transport market, said a release.

Chinese Ports see increased box volumes in 2018

Beijing:According to statistics compiled by the nation’s Ministry of Transport (MOT), ports in China handled 251 mn TEUs of containers in total in 2018, up 5.3% from the previous year.In breakdown, coastal ports were responsible for 222 mn TEUs, up 5.2%, while the remaining 29.09 mn TEUs were moved to and from inland river ports, up 6.2%. Sea-and-rail containers amounted to 4.5 mn TEUs nationwide, which surged a notable 29.4% and accounted for 1.8% of the total container throughput. Looking at container lifting at the top five ports, Shanghai processed 42.01 mn TEUs, up 4.4%; Ningbo-Zhoushan, 26.351 mn TEUs, up 7.1%; Shenzhen, 25.736 mn TEUs, up 2.1%; Guangzhou, 21.623 mn TEUs, up 7.2%; and Qingdao, 19.315 mn TEUs, up 5.5%.

Local staff in Kenya rewarded by Chinese firms

Nairobi:For the last two decades Mark Okumu has been a chef at China Road and Bridge Corp and it was turning point for him in December 2018 when he learned that he was on the list of local employees selected to visit China as a reward for their tireless devotion to duty.On a Monday morning in early April, the 42-year-old father of three was in a buoyant mood when he joined outstanding Kenyan employees working for Chinese companies for a flag-off ceremony before they embarked on the trip to the Chinese mainland. Visits to major cities like Beijing and Shanghai were included in their itinerary. His towering build made Okumu stand out in the crowd, and as he braced for a flight to China, where he hoped to learn about the world’s second-biggest economy’s developing miracle, rich culture and cuisine, his excitement was palpable.”Let me say that everyone in my immediate family is excited about my first trip to China and I thank my employer for granting me this opportunity,” said Okumu.”On my part, I look forward to learning new things about China, especially the cuisine and historical sites.”Okumu, who was born and raised in a farming village in western Kenya, is among the pioneering group of local employees who are grateful to their employer for providing them with an opportunity to hone skills and climb the career ladder. “I feel honoured to be among local employees selected to visit China and my expectations are that I will be able to interact with the hosts, learn about their culture, technology and cuisine,” said Okumu, before the visit.A total of 55 outstanding local employees were selected by more than 20 Chinese enterprises based in Kenya in December 2018 to visit China for eight days as a reward for their impeccable performance at the workplace, as part of the 55th anniversary of diplomatic ties between the two countries. Okumu attended the flag-off ceremony held at the grounds of Chinese Embassy in Kenya ahead of the eight-day trip among the first batch of 28 outstanding employees. The outstanding local employees are expected to revitalize China-Kenya cooperation after the trip, Guo Ce, economic and commercial counsellor at the Chinese Embassy in Nairobi said.”I believe after this trip, you will have a deeper understanding of China and Chinese culture, which will help you more in your future work with Chinese companies,” said Guo. As they mingled freely at the flag-off ceremony, clad in crisp light blue track suits the faces of outstanding Kenyan employees working for Chinese enterprises were radiant.A translator at PowerChina Guizhou Engineering Co Ltd, Sarah Gachekesaid that she looked forward to an exciting trip to China’s mega cities, technology hubs and historical sites.”As someone who majored in Chinese language at the university, I have a head-start as far as knowledge of the country’s rich culture is concerned,” said Gackeke.”However, I am keen to mingle with people, sample new delicacies and learn about China’s engineering prowess and how it can be applied here in Kenya.”Last year, the vivacious young female translator joined the Chinese company after completing her degree in Chinese language at the University of Nairobi’s Confucius Institute. In the coming years she vowed to leverage her proficiency in Mandarin to promote friendship between Kenyan and Chinese nationals.A trip to China will offer a chance for him to forge new friendships and acquire new insights into infrastructure development said Neverson Mwalimo, a 43-year-old father of three who has been a foreman at CRBC for the last two decades. “This trip will offer me a chance to make new friends in China and learn about how the country is modernizing its infrastructure, particularly roads. As we all know, Kenya has benefitted greatly from road construction technology from China,” said Mwalimo.A logistics professional at Twyford Ceramics in her early 20s, Miriam Wanjiru, said she felt privileged to be the youngest outstanding local employee to take part in the trip to China. “This is my first trip to China and I am excited about the prospect of meeting new people and forging lifelong friendship with them,” said Wanjiru. “I feel honored and appreciated by my company for the services that I have rendered with dedication,” she said. Organizers said that the second batch of the rest 27 outstanding Kenyan employees working for Chinese companies had set off for the tour on April 15 to join their colleagues.

Chinese tariffs on goods worth $60 bn to hit back at the US

Beijing:Higher tariffs will be imposed by China on most US imports on a revised $60-bn target list, hitting back at a tariff hike by Washington on $200 bn of Chinese goods in a further escalation of a bitter trade war.US President Donald Trump signals his intent to slap tariffs on all Chinese imports in retaliation if Beijing does not give in, suggesting a prolonged standoff between the world’s two largest economies that could roil global markets for weeks or months to come. The Finance Ministry in Beijing said in a statement that a total of 5,140 US products will be subject to additional tariffs of 5 %, 10 %, 20 % and 25 % starting June 1.Trump announced the escalation, from rates of 5 % and 10 %, hours after he warned China not to retaliate against the latest US tariffs hike.Liquefied natural gas, soya oil, peanut oil, petrochemicals frozen vegetables and cosmetics, are some of the 2,493 goods against which the additional tariff of 25 % will be levied the Ministry said, and of 20 % on another 1,078 products.

Relaxation in biz hours suggested by Chinese envoy to boost trade along Nathu La

Gangtok:China’s Ambassador to India Luo Zhaohui has called for relaxation in trade hours and increase in number of business days along the Nathu La corridor, amid escalating trade war between Beijing and Washington, giving an impetus to Sino-Indian economic ties.An official release issued by state’s Information and Public Relations Department, said the two dignitaries talked about the common areas of concern, which, if addressed, could improve border trade between Sikkim and Tibetan Autonomous Region (TAR). The Chinese diplomat suggested relaxation in business hours and increase in number if stipulated items for trade to facilitate the vendors, when he was here for a day. To increase the volume of trade he also stressed on development of Nathu La as a Dry Port.

Detained Canadians Formally Arrested by China on Spying Charges

The case is being seen as a retribution for Canada’s arrest of a senior Huawei executive
“severe consequences” for Ms. Meng’s arrest, Messrs. Kovrig and Spavor were detained separately in different Chinese cities on Dec. 10. Since their arrest, the two Canadians have been held in solitary confinement, subjected to frequent interrogations and denied access to their families, people familiar with their cases said. Roughly monthly visits from Canadian consular officials, have been allowed to each of them, the most recent of which took place this week, Canada’s foreign-affairs department said.On leave from Canada’s diplomatic service, Mr. Kovrig, a Mandarin speaker, was working as an analyst with the International Crisis Group, a Brussels-based organization that monitors conflicts. He was researching North Korean affairs and drafting a report on that country when he was detained. Based in Hong Kong he would travel frequently to China, his friends said.Through his non-profit, Mr. Spavor led academic, tourist and business delegations on visits to North Korea. He was a fluent Korean speaker who spoke the North Korean dialect. Also he had travelled with Dennis Rodman, the retired American basketball player, to Pyongyang, where they together met North Korean leader Kim Jong Un.Messrs. Kovrig and Spavor were accused in March, of working together to steal Chinese state secrets, by a news website run by the Communist Party’s top law-enforcement commission wh alsod named Mr. Spavor as a contact who the website said supplied intelligence to Mr. Kovrig.Europe and China witnessed slowing growth which weighed on U.S. manufacturers. For the first time since February 2016, overall, export orders shrank in April and imports decreased for the first time since January 2017, according to the ISM report. Mr. Fiore said that persistent labour shortage also continued to harass manufacturers, making it hard for them to ramp up to meet demand. Slower output growth was also reported by some companies because they took time out to service their equipment. Mr. Fiore said, factory activity has been growing for 32 straight months and repairs have been put off. “I don’t think anybody would have taken anything out of service last year to maintain it,” he said.But an uptick in activity could be seen in the coming months by U.S. manufacturers as the global economy recovered, said Michael Pearce, senior U.S. economist at research firm Capital Economics. After getting off to a slow start earlier this year, economies in both Europe and China appear to have stabilized, he said.Gross domestic product grew at an annual rate of 1.5% in the first three months of the year, in the 19-member Eurozone, up from 0.9% in the fourth quarter of 2018. Growth in China also held steady in the first quarter.Those brighter numbers “should begin to seep through” into U.S. manufacturing, Mr. Pearce said. “That would be one reason to not get too worried about this latest number.”Since manufacturing only represents 11.4% of the economy, a slowdown in manufacturing also doesn’t necessarily mean the overall U.S. economy is slowing.

Heavier Chinese Scrutiny for Canadian Soybeans

A possibility is raised that by lobbying group memo that soybeans could be the next export targeted by China
With the most recent annual data indicating sales of nearly 1 bn Canadian dollars, China is the top export market for Canadian soybean growers, PHOTO: JOHN MINCHILLO/ASSOCIATED PRESSOTTAWA— According to a memo from the lobbying group representing growers of the seed, the inspections Beijing: Five months after the pair were first detained, China said it formally arrested two Canadian citizens on espionage charges, advancing a case seen as retribution for Canada’s arrest of a senior Huawei Technologies Co. executive. While entrepreneur Michael Spavor was arrested on allegations of stealing and illegally providing state secrets to overseas forces, Michael Kovrig, a researcher and former diplomat, was arrested on charges of “probing into state secrets and intelligence,” a Chinese Foreign Ministry spokesman said on Thursday.Chinese spokesman, Lu Kang, said at a regular weekday briefing that prosecutors had approved of the arrests, which took place recently. It was not said whom the two men had allegedly spied for, nor did he explicitly link their cases, as the website of a high-level Communist Party commission has done.First detained in December on national-security grounds, the formal arrests of Messrs. Kovrig and Spavor will bring them a step closer to trial. The allegations against the two men potentially carry heavy prison sentences. While neither of them could be reached for comment, it wasn’t known whether they have legal representation. The arrests of Messrs. Kovrig and Spavor, were condemned by Canada’s foreign-affairs department and reiterated its call for their release. China has been accused of detaining them to retaliate against Canada’s decision to arrestMeng Wanzhou, Huawei’s chief financial officer, at the behest of Washington say legal experts and supporters of the men. A broader diplomatic row between the U.S. and China has been embroiled in Canada due to her arrest on Dec. 1.Reporters in Paris were told by Canadian Prime Minister Justin Trudeau that the arrests won’t persuade Canada to release Ms. Meng. “We are not going to change our values or our systems—including the independence of our justice system—because China disagrees with our approach.” It is alleged by that U.S. prosecutors that Ms. Meng took part in bank fraud to circumvent American sanctions against Iran. She has denied the charges and is out on bail in Vancouver awaiting extradition proceedings.A multifront campaign depicting Huawei as a security risk has been mounted in Washington, telling allied and friendly governments that its networking equipment will enable Chinese government espionage. Huawei has said that it had never been spied upon others or been asked to. Messrs. Kovrig and Spavor’s detentions was discussed by President Trump with Mr. Trudeau last week, when the two leaders held phone conversations that included discussions on relations with China. That the two Canadians were detained as payback for Ms. Meng’s arrest is denied by Beijing. Mr. On Thursday Lu, the foreign-ministry spokesman, said that Chinese prosecutors act in accordance with the law and urged Canada not to “willfully criticize” China’s justice system. Days after a senior Chinese foreign-ministry official threatened Canada with of Canadian soybean imports have been escalated by Chinese customs authorities, with at least two shipments rejected this week.The next Canadian export targeted by the Chinese government. could be soybeans is a possibility raised by the memo. In March China revoked import licenses for Canadian canola seeds, a move Canadian Prime Minister Justin Trudeau linked to the geopolitical dispute between the U.S. and China last week.Because of its decision to arrest senior Huawei Technologies Co. executive Meng Wanzhou at the request of the U.S. under terms of an extradition treaty, the dispute has ensnared Canada.The memo was sent this week by the trade group Soy Canada and reviewed by The Wall Street Journal. It said customs authorities are delaying inspections of soybean imports and casting a wider net for possible contaminants, some of which are not tested for by Canadian food inspectors before receiving approval for shipment to China. The memo didn’t talk about import licenses for Canadian soybeans having been revoked.“As of this moment, it is known—as reported by Canadian exporters—that two separate shipments have been rejected this week, both occurring at the Yantian port of entry,” the memo said. It urged members to be aware of the enhanced testing for an increased number of pests, and the risk of shipment rejection.Through a spokeswoman, Canadian Agriculture Minister Marie-Claude Bibeau said officials haven’t received a noncompliance notice from China related to soybeans. She said the government recognizes the pressure faced by farmers, and is ready to support other agrifood producers “should other trade actions occur.”China’s embassy in Ottawa didn’t respond to a request for comment.The top export market for Canadian soybean growers by a wide margin is China, with the most recent annual data indicating sales of nearly 1 bn Canadian dollars ($743 mn) in 2017.Canadian officials were aware of stepped-up inspections by Chinese customs agents of other Canadian agriculture products, outside of canola, they said a few weeks ago at several Chinese ports.A late-April memo from the Canadian government to agriculture-sector stakeholders, relayed the message and was also reviewed by The Journal.

Africa News

IMF’s enhanced general data dissemination system implemented by Madagascar

The recommendations of the IMF’s enhanced general data dissemination system (e-GDDS) has been implemented Madagascar by publishing critical data through the National Summary Data Page (NSDP)
Serving as a one-stop publication vehicle for essential macroeconomic data on the national accounts, government operations and debt, monetary and financial sectors and balance of payments, is the aim of the page.The dissemination of this data will be done in both human- and machine-readable formats. In May 2015 in order to support improved data transparency, encourage statistical development and help create synergies between data dissemination and surveillance, the e-GDDS was established by the IMF’s executive board.The NSDP is hosted on the open-data platform sponsored by the African Development Bank (AfDB) and is posted on the webpage for Madagascar. National policymakers and domestic and international stakeholders including investors and rating agencies, will be provided with easy access to information critical for monitoring economic conditions and policies, thanks to publication of essential macroeconomic data through the NSDP.Simultaneous access to timely data and bring greater data transparency by making this information easily accessible in both human- and machine-readable formats will benefit users. This major milestone in the country’s statistical development was welcomed by Louis Marc Ducharme, chief statistician and data officer and director of the IMF’s Statistics Department,. “I am confident that Madagascar will benefit from using the e-GDDS as a framework for further development of its statistical system.”A project on the improvement of data dissemination financed by the UK’s Department for International Development has benefitted Madagascar.

Custom-made solutions for high-pressure applications by Sauer Compressors

A range of accessories including compressor controls, air and gas dryers as well as storage and distribution solutions, aiming to provide custom-made high-pressure solutions from a single source viz. Sauer Compressors has been unveiled.
The Sauer ecc 4.0 compressor control system is a cornerstone in Sauer’s accessories portfolio.The control, that enables an exact adaptation to the individual version of the compressor, is based on an intelligent modular design principle. The new control can be integrated into higher-level systems and aims to support communication via all common interfaces.
Drying and storage solutions
Individually tailored solutions are provided by Sauer for drying and storage that cater to the requirements of the individual application. There are two dryer series specially designed for high-pressure applications.The Sauer SRD series are high-pressure refrigerant dryers suitable for drying air and gases with final pressures of up to 420 barg (bar-gauge) and achieve a pressure dew point of three to five degree Celsius.The high-pressure adsorption dryers of the Sauer SDD series is set to achieve reliable dew points of up to -40°C at final pressures of up to 350 barg.
Diversity in accessories portfolioThe company provides a range of high-pressure storage systems for wet and dry gases for pressures of up to 350 barg.Development, production and sale of medium- and high-pressure compressors for applications in commercial shipping, industries, the petroleum industry and the defence sector are the focus of Sauer Compressors. The four product lines SAUER, HAUG, Girodin und EK focus on specific fields of application. The SAUER line comprises oil-lubricated high-pressure compressors for a wide variety of applications, while HAUG stands for oil-free and hermetically gas-tight compressors. The Girodin and EK lines provide special compressors for the naval market.

Angola’s economic reform gets practical support from ECA

Three work streams to support Angola on its sustainable development trajectory and macroeconomic reform agenda have been established by the UN Economic Commission for Africa (ECA)
Four main areas of cooperation were agreed in a series of high-level talks with Angolan authorities that culminated with discussions at the Presidential palace. Supporting Angola restore macroeconomic stability and diversify its economy within the context of the country’s National Development Plan 2018-2022, improving public debt management, increasing the share of renewable energy in the country’s energy mix and capitalising on the opportunities of the African Continental Free Trade Area (AfCFTA), are included in these. A series of measures comprises President João Lourenço’s reform agenda to render Angola’s economy more diversified and less oil-dependent – including a demarche to restructure inefficient state corporations, strengthen the country’s fiscal sustainability, reduce inflation, improve overall macroeconomic fundamentals, foster social inclusion, stem corruption and improve the business environment to stimulate foreign and local investments. Assuring President João Lourenço, ECA’s Vera Songwe said, “ECA is ready to work with you in your efforts to improve domestic resource mobilisation, debt management and crowding in the private sector. We hope that Angola will be part of the community of African nations which would have ratified the AfCFTA when we meet in Niamey, next July,” she added. While making a call for serious work towards improving public debt management she acknowledged the positive steps Angola had already taken to broaden its tax base, including the use of local-currency-denominated debt. Angola’s public debt burden is estimated to be as high as 60 % of its GDP by analysts. Angolan authorities were suggested to embrace the digital economy, by Songwe, including Fintech as a means to explore the creative potential of the youth and generate jobs in the service and other sectors. The continental trade agreement was an investment opportunity for Angola to build a diversified and competitive economy she noted and that Angola should use it as an opportunity to fast-track its horizontal and vertical economic diversification program. Accordingly, ECA will work with Angola to formulate national AfCFTA strategies.

Deal for Egypt’s extended fund facility reached by IMF

From 5-16 May 2019, an International Monetary Fund (IMF) team led by Subir Lall visited Egypt to conduct the fifth and final review of Egypt’s economic reform programme supported by a three-year extended fund facility The staff-level agreement is subject to approval by the IMF’s executive board. Completion of this review under the programme would make available about USD2bn, bringing total disbursements to about USD12bn. According to Lall, “Over the last three years, the Egyptian authorities have carried out an ambitious home-grown reform programme which has aimed to correct significant external and domestic imbalances, promote inclusive growth and job creation and strengthen social spending.” “The authorities’ efforts have been successful in achieving macroeconomic stabilisation, a recovery in growth, and an improvement in the business climate. GDP growth accelerated from 4.2 % in 2016/17 to 5.3 % in 2017/18; unemployment declined from 12 % to below nine % and the current account deficit narrowed from 5.6 % of GDP to 2.4 %,” Lall added. “Gross general government debt is expected to decline according to our estimates to about 85 % of GDP in 2018/19 from 103 % of GDP in 2016/17. International reserves increased from USD17bn in June 2016 to USD44bn in March 2019” Lall noted. “The Central Bank of Egypt (CBE) has modernised its monetary policy framework, which focuses on inflation as its primary objective under a flexible exchange rate regime. Its monetary policy stance has been appropriately calibrated, helping to reduce inflation from 33 % in July 2017 to 13 % in April 2019 despite occasional supply-side shocks and excessive volatility in some food prices.” “Addressing food supply bottlenecks by investing in logistics, storage facilities and transport infrastructure and reducing non-tariff trade barriers are important measures that would reduce this volatility. The CBE aims to reduce inflation to single digits in the medium term. This would help to further strengthen macroeconomic stability, reduce interest rates, and attract investment. The CBE’s commitment to exchange rate flexibility ensures that that the Egyptian pound reflects economic fundamentals, protects international reserves, and enhances the economy’s resilience to external shocks. The CBE has also established itself as a credible guardian of financial sector stability,” Lall further added. “Egypt is on track to achieve its three-year fiscal consolidation objective of 5.5 % of GDP in the primary balance. The primary surplus target of two % of GDP in 2018/19 is within reach, and the authorities intend to maintain this level in the medium term to keep general government debt on a steadily declining trajectory,” said Lall. “The major reform areas include improving access to finance, improving industrial land allocation, enhancing competition, strengthening transparency and management of state-owned enterprises and fighting corruption. Timely completion of the planned measures would yield significant dividends in terms of higher investment, inclusive growth, and job creation,” Lall commented.

New global project to tackle maritime GHG emissions launched by UN agency

With a view to support the International Maritime Organization (IMO)’s initial strategy for reducing greenhouse gas emissions from shipping a major international project has been launched. The project called GreenVoyage-2050, will initiate and promote global efforts to demonstrate and test technical solutions for reducing such emissions, as well as enhancing knowledge and information sharing to support the IMO GHG reduction strategy. A collaboration between IMO and the Government of Norway, GreenVoyage-2050 will run for an initial two-year period. Across the globe more than 50 countries in 14 sub-regions are expected to participate, including developed countries and strategic partners from the private sector, who will contribute expertise and experience. Capacity building in developing countries, including small island developing states (SIDS) and least developed countries (LDCs), to fulfil their commitments to meet climate-change and energy-efficiency goals for international shipping will also be undertaken by the project. Initially, pilot roles are expected to be taken by eight countries, from five high-priority regions (Asia, Africa, Caribbean, Latin America and Pacific), to pursue and undertake actions at the national level. These pilot countries will then become “champions”, galvanising momentum by supporting other partnering countries in their respective regions to follow a similar path. IMO Secretary-General Kitack Lim while speaking at the official launch of GreenVoyage-2050 (Monday 13 May),said the project was a direct response to the need to provide technical assistance to States and to support technology transfer and promote green technology uptake to improve energy efficiency and reduce GHG emissions throughout the maritime sector. For its generous financial support for GreenVoyage-2050 – NOK 10,000,000 (USD1.1 mn) for the initial two years of the project Mr. Lim thanked the Government of Norway– and for the intention to fund the project beyond the two years. Particularly attention was drawn to the importance of private-sector participation in the project by Mr Lim also. “I am particularly encouraged by the fact that the GreenVoyage-2050 project is designed with a private-sector partnership component,” he said. “This will accelerate the uptake of technology solutions by the industry”. By mobilising additional resources GreenVoyage-2050 will eventually be scaled-up vertically (more technology demonstration and infrastructure efforts) and horizontally (more pilot countries joining the project). The objective is to accelerate implementation of the initial IMO GHG strategy. With a view to drawing on their results to encourage the phasing in of zero and low-emission solutions for shipping in developing countries partnerships with existing programmes (such as Norway’s Green Shipping Programme) will be explored. Welcoming the collaborative nature of the project, Mr Lim said, “Another of this project’s most important aims is to spur global efforts to enhance global knowledge management and information sharing for climate action and sustainable oceans. In this time of greater connectivity and more rapid technological advances than ever before, I cannot stress enough how timely the launch of this project is”. Delivery support to least two of the United Nations Sustainable Development Goals (SDGs): SDG 13 on climate change and SDG 14 on sustainable use of the oceans will be given by the project. Mr Sveinung Oftedal, Specialist Director of the Norwegian Ministry of Climate and Environment, said, “Norway is very pleased to enter into this new partnership with IMO at a time when the global maritime community is discussing ways and means of supporting the implementation of the IMO initial GHG strategy. By addressing one of the highest priority environmental issues faced by maritime transport sector and by catalysing development of technological solutions, GreenVioyage-2050 can substantially contribute to the UN sustainable development goals and the objectives of blue economic growth in developing regions”. IMO has a strong record in taking on and delivering global and regional projects such as this. From other successful environmental projects delivered by IMO, GreenVoyage-2050 will embrace good practices learnt. In particular, it will build on the momentum gained from two current projects: GloMEEP, the GEF-UNDP-IMO Global Maritime Energy Efficiency Partnerships Project, which has itself established a successful public-private partnership, namely the Global Industry Alliance To Support Low Carbon Shipping, and the European Union-funded GMN project, which has established five Maritime Technology Cooperation Centres in Africa, Asia, the Caribbean, Latin America and the Pacific. The project agreement between IMO and Norway signed on the first day of IMO’s Marine Environment Protection Committee (MEPC), 74th session (13-17 May) and the project was launched. MEPC 74 will continue its work on reducing GHG emissions from ships, in line with the initial GHG strategy among other agenda items.

African market sought by Kenyan banks

Their favourite home-based banks ) would be available easily to a Kenyan living in Zambia, Mozambique, Ethiopia or the Democratic Republic of Congo (DRC to transact banking business with, as the east African nation’s top financial institutions go for the regional markets.
The customers would be able to make deposit or withdraw cash, remit cash back home and access mobile banking services affordably and just as easy as they do while at home, thanks to an ongoing expansion drive by banks in the east African nation. After conquering the Kenyan market, and extending to the larger East African Community countries, top Kenyan banks, namely Equity Group and Kenya Commercial Bank (KCB) Group, are now following in the footsteps of their South African and West African peers, which have branches in various African countries. Buyout talks with a bank in the DRC are on, as it seeks to enter the market announced KCB Group on May 7. The bank had earlier declared that it is in talks with authorities in Ethiopia to enter the market and it is also eyeing Somalia. Once completed, the new branches would facilitate deals in syndicated lending and trade finance, said KCB chief executive Joshua Oigara “Ethiopia is a restricted market but there are reforms going on. We are optimistic they will allow Kenyan banks,” said Oigara. KCB is following in the footsteps of its rival, Equity Group, which already operates in the market, by eyeing DRC, having entered some two years ago by buying a lender. Similarly, plans to enter the Mozambique and Zambian markets in a deal with London Stock Exchange-listed banking group, Atlas Mara were announced by Equity Group on May 1.The buyouts would help them build economies of scale and make it a Pan African bank, Equity Group chief executive said.Kenyan banks would be put in direct competition with South African lenders like Stanbic and Nigeria’s Ecobank, all which are operating currently in east Africa’s biggest economy and other nations in the continent post the expansion.Ever since Premier Abiy Ahmed took over and started reforms, Kenya has aggressively sought to bolster ties with Ethiopia.Seeking to enhance economic partnership with Ethiopia, President Uhuru Kenyatta in March led a delegation into the country with a focus on trade and investment.Besides banks, Kenya’s leading telecom Safaricom is also eyeing the Ethiopian market.The expansion drive would see the Kenyan banks “significantly increase size, placing them in a position to leverage on economies of scale in the rollout of their digital platforms in the region,” noted Cytonn, a Nairobi-based investment firm on Monday. One of the reasons is making the banks go continental analysts said, is that Kenya’s trade with several African counties is on the rise. The expansion drive is in line with Africa’s one-continent dream and the soaring trade puts Kenya banks at a pole position to settle financial deals across the region noted Ernest Manuyo, a business management lecturer at Pioneer Institute in Nairobi.However, not only are the Kenyan banks eyeing the continental market, KCB is also working on plans to open a representative office in China as it seeks to reap from the growing trade between the Asian nation and Africa. Enditem

A Wider Malaise in Middle East Reflected by Emirates Results

The dramatic slowdown of Emirates Airline’s growth appears to reflect a wider trend among Middle Eastern and African carriers last year, as revenue passenger kilometers (RPKs) stalled throughout the region during the period and profits dipped dramatically due largely to higher oil prices. Fuel expenses rose 22 % over the course of the company’s last financial year, accounting for 32.3 % of operating costs. While its fleet size increased by just two aircraft, the Middle East’s leading airline saw its profit margin narrow to a wafer-thin 0.9 % on net profits of $237 mn, during the annual period ending March 31. While it phased out a total of 11 aircraft Emirates inducted seven A380s and six Boeing 777-300ERs during the year ending March 31, but the airline’s next 777 doesn’t come due for delivery until 2020, when Boeing’s first 777X joins the fleet. While global industry traffic grew 4.6 % during the 12 months ending January 31, traffic measured in RPKs fell 0.8 % in the whole of the Middle East, “While the rest of the world is growing steadily or rapidly, the Middle East has stalled,” said analyst Peter Harbison, executive chairman of the Sydney-based Center for Aviation (CAPA), in his opening address at the April 29 CAPA Middle East and Africa Aviation Summit. CAPA’s database showed that Emirates’s growth in the number of “system seats,” or seat capacity, tapered from more than 12 % year-over-year in 2015 to 3 % in 2017 and only 2.6 % last year. Harbison said, the number of seats declined by 2.5 %, at Abu Dhabi-based Etihad, largely as a result of structural losses totaling over $1 bn in each of the last three financial years,. Since 85 % of the seat capacity at Abu Dhabi International Airport was accounted for by Etihad, its change in fortunes also reflected that of Abu Dhabi, he implied. “Of the ‘Big Three,’ only Qatar Airways, constrained by a blockade, has proceeded with its growth,” he said. “[Seat] capacity was up 6.8 % year-on-year in 2018.” Harbison said that previously Saudi Arabian Airlines’ growth had been self-limiting. “But more recently, expansion, domestically and internationally, is occurring as the government strategy changes,” he said. Owing to limited investment African airlines suffered constraints. CAPA data shows only 1,707 aircraft in the continental fleet and the order total stands at only 263, a number considered insufficient for fleet replacement, let alone expansion. North Africa, in isolation, accounts for a particular and aggravated case of the malaise. Secretary General of the Beirut-based Arab Air Carriers Organization, Abdul Wahab Teffaha, revealed startling information underscoring the importance of aviation to Arab economies. Based on data from 2017 and 2018, he concluded that globally, aviation accounts for 65.5 mn jobs, or 2 % of the total workforce, whereas it accounts for 6 mn jobs in the Arab world or around 5 % of jobs. Globally, aviation contributes $2.7 trillion, or 3.6 % of total GDP, while the Arab world’s aviation contribution was $164 bn, or 7.8 % of GDP in 2017.

IMO delisting of 87 countries escaped: Nigeria

On account of non-compliance with requirements of the 1978 Standards of Training, Certification and Watch-keeping for Seafarers (STCW) Convention as amended from its Whitelist , the International Maritime Organisation (IMO), plans to delist about 87 countries. The Guardian gathered that Nigeria escaped the IMO hammer, and has maintained its position on the Whitelist, an indication that it is a healthy member of the United Nation (UN) agency, as nations express worry over the new development. The Director-General, Nigerian Maritime Administration and Safety Agency (NIMASA), Dakuku Peterside, who confirmed the development, told The Guardian that, “Nigeria is not on the list.” According to NIMASA, Nigeria has ratified about 35 IMO conventions/protocols including the STCW Convention 78. Others are;SOLAS Convention 74; SOLAS Protocol 78; SOLAS Protocol 88; Load lines Convention 66; Loadlines Protocol 88; STAR Convention 79; MARPOL 73/78 (Annex 1/11); MARPOL 73/78 (Annex III); MARPOL 73/78 (Annex IV); MARPOL 73/78 (Annex V); MARPOL 97 (Annex VI); CLC Protocol 1992; Fund Protocol 1992, among others. Nigeria and 23 other maritime nations were listed on the IMO’s Whitelist in 2006,, a development that further boost the chances of local seafarers in the employment market. The 1978 STCW Convention stipulates standards of training, certification and watch-keeping for seafarers. “The main purpose of the Convention is to promote safety of life and property at sea, and the protection of the marine environment by establishing in common agreement international standards of training, certification and Watch-keeping for seafarers,” according to the IMO. Currently IMO has 174 member states, and three associate members, with 40 of them African. However, while it is still uncertain how many African countries would be affected, the South African Maritime Safety Authority (SAMSA), has already expressed concern that the planned deletion of South Africa from the STCW Whitelist would have major implications for its maritime sector. The agency was extremely concerned by IMO’s planned action, Chief Executive Officer, SAMSA, Sobantu Tilayi, was quoted as saying. The IMO circular merely stated the intention to delist some member countries without stipulating a date for the implementation, but Tilayi noted that the delisting could possibly be undertaken later in 2019. “Even as we have a serious situation in our hands, and should never have found ourselves in this position, I am confident that we will act with speed and do so correctly to ensure that the intended action by the IMO’s Maritime Safety Committee is not finalised to South Africa’s disadvantage,” Tilayi said. Three broad activities would comprise its response to the planned action, SAMSA explained – securing IMO assistance with compilation of the report required in terms of the Convention; hastening the Agency’s process to institute relevant quality management system; and constant engagement with stakeholders.

IATA –Slowdown in African airlines passenger demand due to crumbling businesses

The International Air Transport Association (IATA) says falling business confidence in some of Africa’s key economies had led to lower patronage for most of the continent’s local airlines or a decline in passenger demand A myriad of factors such as insufficient power supply; high interest rate; unfavourable economic climate; financial problems; unclear economic laws; unfavourable political climate; insufficient demand; and access to credit, are some of the major factors constraining business activities with dire impact on the continent’s aviation industry in Nigeria, like in many other African states. The global passenger traffic results for March 2019 released by IATA said although the passenger patronage of African airlines’ reflected a decline from a 2.5 % rise in February 2019 to 2.1 % in March 2019. The upward traffic trend in Africa has softened since mid-2018 in line with falling business confidence in some of the region’s key economies,” said IATA’s CEO, Mr. Alexandre de Juniac. Compared to the same month a year ago, the IATA’s global passenger traffic report for March 2019 showed that demand (measured in revenue passenger kilometers, or RPKs) rose by 3.1 %, which it noted was the slowest pace for any month in the past nine years. Air paseenger travel data collected by region and worldwide during March 2019, IATA said is the basis for this latest analysis of demand for air passenger travel.“While traffic growth slowed considerably in March, we do not see the month as a bellwether for the rest of 2019. Nevertheless, the economic backdrop has become somewhat less favourable, with the IMF having recently revised its GDP outlook downward for a fourth time in the past year,” added, IATA’s Director General and CEO, Alexandre de Juniac.

South African digital currency plan unveiled and explained by Reserve Bank

The possibility of a digital currency backed by the Rand is being investigated by the South African Reserve Bank (SARB). In 2019 it plans experiments with at least three different designs and/or deployment models. The SARB said while speaking ro Business Tech that it is in the process of engaging with possible vendors to explore the feasibility of a central bank digital currency (CBDC) as electronic legal tender (ELT). “Rapid technological changes have prompted major central banks across the globe to consider electronic forms of cash,” it said. “Since late 2016, SARB’s Currency Management Department has conducted extensive research to understand the case for such an electronic form of cash, called electronic legal tender (ELT). This would be a domestic, general purpose central bank digital currency (CBDC), issued and backed by the SARB.”Admitting that it does not have a formal position on the feasibility of issuing an ELT, the SARB said it is proactively seeking to understand the policy and other implications of issuing one. Various forms of public and private virtual currencies have so far been understood by the research conducted, as well as the potential implications should a central bank decide to issue a general purpose CBDC. “The next phase will be practical hands-on experimentation of potential design models in an innovation lab (sandpit) environment by considering available emerging technologies as well as security and risk management aspects,” it said. “The SARB project team has documented a number of use cases for testing purposes, and is now in the process of identifying vendors to participate in the innovation lab experimentation.Final outcomes from the experimentation will be used as input to determine the SARB’s position on CBDC as ELT,” it said.

International News

April 2019 saw 2.2% rise in container traffic from Asia to USA

New York:In April there was a growth of 2.2% in container traffic from 10 major Asian countries to USA, with a total of 1,262,770 TEUs, a year on year increase for the second consecutive month, according to statistics released by U.S. research firm Descartes Datamyne. The movement of 5,063,734 TEUs in the first four months of 2019 meant an increase of a miniscule 0.8%.The Descartes Datamyne statistics, are compiled with Automated Commercial Environment (ACE). Their data and a look at the bills of lading (B/L) data provided by the U.S. Customs and Boarder Protection (CBP) shows the country of origin of the containers. Study of this data indiacates that at 732,334 TEUs of containers from China, there has been a decrease of 2%, suffering the first year-on-year contraction in six months. South Korean ships on the contrary increased 3.5% to 136,206 TEUs, finishing in second place. Taiwan surging 20.7% to 84,145 TEU had the third largest share. At 72,178 TEU and with a growth of 33.2% were exports from Vietnam which finished in fourth place. At 44,208 TEUs exports from Japan declined 1.4%. This includes transshipment (T/S) containers. The overall volume of shipments from Japan climbed 3.5% to 58,415 TEUs, based on volumes measured at destinations. The ten categories that did brisk business were furniture, machinery and electronic appliances. Auto-related rubber products decreased from a year earlier.

To counter Belt and Road, Japan and India to develop Colombo Port

Tokyo:Japanese media firm Nikkei has learned that the Governments of Japan, India and Sri Lanka have agreed to jointly develop the Port of Colombo, in the face of the gaining importance of the Indian Ocean to global trade.To increase container volume handled at the port and to boost marine transport around south-Asia are the chief objectives of the project. With China trying to be an influencial player with its Belt and Road projects, Japan doe not want to be left behind and wants to its Free and Open Pacific Ocean and Indian Ocean agenda. Work on the port will begin by next March as the trio sign a memorandum of nderstanding. Columbo connects Europe, the Middle East, Africa and Asia and is the largest port in Sri Lanka. 90% of the country’s seaborne goods pass through it. In 2017 it handled 6.21 mn TEUs to become Southwest Asia’s busiest port. As economies in the region boom, the port is expected to operate at full capacity.The East container terminal located in the southern part of the Port of Colombo will be developed by the trio. This southern part has been newly expanded. In developing the east they will deepen it and create a facility to allow large container ships to dock. Agreement on the scale and form of the project will be reached soon by Government officials from the three countries and currently they are in working-level talks. Corporate partners will also be involved. A part of the project will be financed by the Japanese Official Development.The Japanese Government is also concerned going by what a Japanese Government source said, “If the development of the Port of Colombo takes time, cargo might be transferred to Hambantota.” Improved capacity of the region’s ports will strengthen the security of tankers and commercial ships because some of Japan’s maritime routes run through the Indian Ocean.

Morgan Stanley says that thr US – China trade war will push the world towards recession

New York:The world economy is being pushed towards a recession with the collapse of US-China trade talks and hike in tariffs on Chinese goods. With the result the Federal Reserve will cut US interest rates back to zero within a year, said analysts at Morgan Stanley. If it remains short-lived, damages from the trade war escalation will be navigated without much consequence, but if not, it will inflict serious pain.The bank’s analysts said in a note, “If talks stall, no deal is agreed upon and the U.S. imposes 25% tariffs on the remaining USD300 bn of imports from China, we see the global economy heading towards recession.” As a retaliatory measure, by spring of 2020 rates will be cut back to zero by the federal bank in Usa and by spring 2020 while China would scale up its fiscal stimulus to 3.5% of GDP (equivalent to around $500 bn) and its broad credit growth target to 14-15% a year they added. “But, a reactive policy response and the usual lags of policy transmission would mean that we might not be able to avert the tightening of financial conditions and a full-blown global recession.” A growth of less than a threshold value of 2.5% marks a global recession.

In March, rare jump recorded in Canadian export

Second increase in 8 month in this March; trade deficit narrows to C$3.21 bn

Ottawa:A rare broad-based gain in exports in March saw Canada’s trade deficit with the rest of the world shrink a little. Statistics Canada said on Thursday that the country posted a merchandise trade deficit with the rest of the world of 3.21 bn Canadian dollars ($2.38 bn). According to economists at TD Bank, market expectations were for a C$2.3 bn deficit. The previous month’s trade deficit was revised higher, to C$3.42 bn from the earlier C$2.90 bn estimate, because energy exports didn’t increase as much as anticipated. In March exports increased 3.2% year-on-year to C$49.05 bn. Of the 11 categories tracked by the data agency, 9 recorded gains. This is only the second increase in exports in eight months. Note must be taken of nonenergy exports which had their best performance since June of last year. Energy, Canada’s biggest export increased by 7.7%. Purchases of consumer goods – with clothing and footwear on top – saw imports climb up a record 2.5% to C$52.26 bn in March. In March in volume, or price-adjusted terms, exports rose 2.6% and imports dipped 1.3%. Despite a good March, net trade will be a significant drag on first-quarter growth say reports. On a nominal, nonannualized basis, Exports climbed 0.5% while imports rose 2.2%, on a non-annualized basis. Exports fell 2.4% and imports climbed 2.4% in the January-to-March period on a price-adjusted, or volume, basis. “The first quarter was nothing short of horrific from a growth perspective,” said Benjamin Reitzes, economist of BMO Capital Markets, after reviewing the March trade figures. The Bank of Canada had already pegged growth prospects at a weak 0.3% annualized gain and it is possible that forecasters further downgrade their growth prospects for the first quarter, he added. Late this month will the data covering first-quarter Canadian gross domestic product be released. Downgrading sharply its economic forecast for 2019 last month, the Bank of Canada anticipates 1.2% growth for the year. A weakness in the domestic energy sector, the central bank said, was the reason for its economic downgrade. Uncertainty over global trade conflicts weighed on exports and investment. Mr. Stephen Poloz, Governor of the Bank of Canada argued however that the slowdown will be temporary and expansion will gather steam in the second half of the year. In March Canadian exports to the US upped 1.3% to C$36.38 bn. US sales equal nearly three-quarters of Canadian exports. Therefore, Canada’s trade surplus with the US widened to C$3.62 bn in March. Sales in China were weak but there was a strong demand for Canadian goods in Japan and Europe rising Canadian exports to non-US markets by a healthy 8.8%. After detention of a senior Huawei Technologies’ executive, China and Canada hav been engulfed in a trade row.

Economists stunned with Japan’s 2.1% growth, but say all is not rosy

Public investment growth to overcome the impact of US-China trade tensions drove economic expansion in Q1 The economy of Japan was expected to be flat or slightly negative in Q1.
Tokyo: Government spending unexpectedly pushed the Japanese making it grow in Q1 2019 although anxiety due to the US-China trade dispute cannot be ruled out.In Q1 2019 the economy expanded an annualized 2.1% after 1.6% revised growth in the previous quarter. A negative figure or no growth was expected for Q1 by most economists.“It has a significant meaning that Japan avoided falling into a contraction,” said Daiwa Institute of Research economist Shunsuke Kobayashi. “As a cold war between the U.S. and China has reopened, exports will likely slow down after May, weighing on Japan’s growth rate again.”Japan, the world’s third largest economy after USA and China already felt impacted from the trade frictions on Monday as indicated by the results. Capital expenditures plummetted at annualized 1.2% and private consumption, nearly 60% of gross domestic product, also fell 0.3%.“Due to the slowdown in the overseas economies, mainly in China, sentiment among Japanese companies, especially manufacturers, as well as households, is becoming more and more cautious,” said a Cabinet Office official. Mari Iwashita, Economist at Daiwa Securities said that the capital expenditure decline was smaller than expected despite weakness in exports and production, and that could augur larger declines ahead.Private investment slowdown was offset by a rise in public investment at an annualized 6.2% in Q1 2019, after a decline the earlier quarter.After a series of natural disasters last summer, the government planned to spend ¥3 trillion ($27 bn) for measures including rebuilding / reinforcing infrastructure, under its second supplementary budget for FY 2019. Investments were also made in increasing earthquake resistance at schools and easing the burden of a planned sales-tax hike in October, such as by helping smaller retailers pay for new checkout machines. Takuji Aida, Economist at Société Générale said, “The government’s spending on disaster prevention and lack of urgency in trimming budget deficits shows “it is gradually becoming clear that Japan is turning toward looser fiscal policies from previous austerity ones.”A strong GDP will encourage Prime Minister Shinzo Abe to increase sales-tax from 8% to 10% scheduled for October, contemplate economists. On Monday Toshimitsu Motegi, Economy Minister said, “There is no change in our views that raising the consumption tax to 10% will help fiscal health and also help make social security more robust and stable.”

US-Iran tensions move to day 3; oil rises for third time

US alleges Iran was behind Saudi oil tanker attacks resulting in 2% hike in crude oil prices
For a thrid consecutive day there was a hike in oil prices on Thursday, driven gains in the stock market and mounting friction between Iran and U.S. allies that pose a threat to smooth oil supplies and shipments in the Middle East.- The US oil benchmark, West Texas Intermediate futures closed 1.4% higher at $62.87 a barrel on the New York Mercantile Exchange, landing the biggest one-day gain in three weeks and the highest closure since May 1.- The global oil benchmark, Brent crude closed 1.2% higher at $72.62 a barrel on London’s Intercontinental Exchange.
HIGHLIGHTS
Iran: Already this week oil is 2% higher. Investors start tacking on a risk premium to prices after a US official allege Iran was likely responsible for the recent attacks on Saudi oil tankers in waters off the United Arab Emirates, something that Tehran has denied.Houthi rebels in Yemen, allies of Iran who are fighting a Saudi-backed coalition claimed responsibility for an attack earlier this week on a major oil pipeline in Saudi Arabia. On Thursday Saudi-led coalition warplanes in an apparent counterattack bombed areas held by the Iran-allied rebels in Yemen.This seems a consequence of Trump’s increased oil sanctions on Iran, that prevents any country from buying Iranian crude oil without facing financial penalties. In response Iran has called the sanctions “unacceptable,” and hinted of moving away from agreements made in a 2015 nuclear deal.“As suggested this morning, we look for occasional minor skirmishes in the Persian Gulf to maintain significant risk premium for a while,” said Jim Ritterbusch, president of oil trading advisory firm Ritterbusch & Associates. “But at the same time, we don’t expect much additional risk insurance as we feel that Saudi production will slowly be ramping up in anticipation of a more significant supply disruption.”

Collaboration of shipping industry on emmission reduction urged by IMO Chief

London:Kitack Lim, Secretary General of International Maritime Organization, a UN organisation held a week-long meeting at its London headquarters urging the shipping industry to collaborate on preparing for tighter sulphur restrictions next year.The IMOs Environment Protection Committee meets this week for the last time before the global sulphur emission limit drops from 3.5% to 0.5% at the start of next year. It was the MEPC that decided on the final date for the start of the new limit in 2020 when they met in October 2016.Lim said, “Significant efforts have been made by this organization to help the shipping industry to prepare. I cannot stress strongly enough how significant this decision was for the environment and human health.” He admitted that it was “not easy” for shippers to adjust to the new limit. “It’s a very, very difficult task. It is imperative that this organization demonstrates that it will continue to take tangible action to reduce GHG emissions from shipping in the short term,” Lim said at the opening of the meeting. “The global community needs to bring action, not words.”

New project to tackle maritime GHG emissions launched globally by IMO

London:A major international project to support the International Maritime Organization (IMO)’s initial st rategy for reducing greenhouse gas emissions from shipping has been launched. The project titled GreenVoyage-2050, will initiate and promote global efforts to demonstrate and test technical solutions for reducing such emissions, as also to enhance knowledge and information sharing in support of the IMO GHG reduction strategy. To be run for two years initially, the GreenVoyage-2050 is a collaboration between IMO and the Government of Norway. Developed countries and strategic partners from the private sector will contribute expertise and experience in this collaboration where more than 50 countries in 14 sub-regions across the globe are expected to participate. Another objective of the project is to help developing countries – including small island developing states (SIDS) and least developed countries (LDCs) – build capacities to fulfil their commitments to meet climate-change and energy-efficiency goals for international shipping.

Future demand for shipping to depend on Global economy and World population

London: Pierre Cariou, Senior Professor at KEDGE Business School (France’s biggest business school), says that demand for shipping in the future will remain greatly depend on the global economy and GDP, as well as world population. He presented to an audience at the International Transport Forum’s (ITF) Future Maritime Trade Flows Roundtable, noting that shipping will continue to be a derived demand. Innovations in the shipping sector such as containerization were the main world trade drivers prior to this. But now, globalization and GDP growth, would be the drivers of growth in maritime trade.There were his concluding remarks for a report on altering demand for maritime trades. How a general trend towards decarburization of the global economy is affecting coal and crude oil, the two biggest commodities moved at sea, and that relocating production close to centres of consumption could lower demand, were some other invaluable inputs from his presentation.“Now the key question is whether or not new maritime innovations — such as fast/autonomous/zero-emission ships — will take place to tackle the challenges of the new era of digitally-enabled trade,” Mr Cariou said.

Travel company Transat purchase talks initiated by Air Canada

Consolidation of the country’s airline industry will get accelerated and a deal is likely to draw scrutiny.
Air Canada said Thursday that it was in exclusive talks to buy Travel-services specialist Transat A.T. Inc. is being wooed by Air Cananda confirmed the latter on Thursday saying it was in exclusive talks to purchase the former. The move is expected to accelerate consolidation of the country’s airline industry.Valued at C$ 520 mn (USD 387 mn) the potential deal will be the second to be announced this week, leaving just two carriers to dominate the market, a development likely to draw intense political scrutiny. Already the country’s largest domestic and international airline, buying Transat would make Air Canada the biggest player on routes to Europe, Latin America and the Caribbean. Transat will add more than 30 jets and an airline and a tour operator.Canadian numer two WestJet Airlines on Monday said it had accepted an acquisition offer by Onex Corp, a private-equity firm, for C$2.6 bn. Onex is paying a hefty premium in this transaction, compared to its earlier attempt to buy Air Canada 20 years ago.In March Transat said that it had received approaches, and on Thursday said that its board recommended entering a 30-day exclusivity period with Air Canada. Air Canada is offering C$13 per share to Transat, or a 22.9% premium to Wednesday’s closing price of C$10.58.Air Canada confirmed having necessary funding for the transaction, which it said would create a Montreal-based global travel-services company. There was a 4% hike in Air Canada’s share prices as markets closed on Thursday. However the Air Canada-Transat deal, will be scrutinised by Canada’s antitrust watchdog as also the Canadian Transport Minister, who has the final say on the it.The transport ministry must ensure the deal does not harm public interest, as mandated by law. Mr. Michael Osborne, a competition lawyer at Cassels Brock in Toronto said, “Public-interest concerns are a very big black box—we don’t know what goes into that recipe.” Representatives of Canada’s Transport Minister Mr. Marc Garneau, did not comment immediately. With a combined share of 65% of trans-Atlantic flights this summer the union will be a strong player just as leapfrog Toronto-based Sunwing Travel Group with almost half the market on routes to Mexico and the Caribbean, judging from a market-share breakdown in a Transat investor presentation in March.All three operators namely, Air Canada, WestJet and Sunwing use the Boeing 737 MAX. After two fatal crashes of the aircraft and its subsequent grounding, they have had to scramble for alternative aircraft. Air Canada is seeking help from Transat and other carriers like Qatar Airways to provide flights on its behalf.Transat is moving to an all-Airbus SE fleet, including A321neo jets that could play a similar role to the MAX.

April sees a slowdown in U.S. factory activity

Anxiety over trade tensions and delays at the US-Mexico border are the chief causes of the downslide
Washington:Grappling with a slowing economy, trade tensions and the impending closure of the US-Mexican border, factories in the US are slowing down.The Institute of Supply Management produced an index of factory activity that has been falling since August, plummeting to 52.8 in April, the lowest reading since October 2016. This indicates that manufacturing in the US is still growing but at a slower pace. Readings above 50 indicate activity is expanding, while those below 50 are a sign of contraction.“We’re coming down faster that I would really like,” said Timothy Fiore, chairman of the ISM’s Manufacturing Business Survey Committee. “There’s no doubt we’re not expanding as we were.”Uncertainty shrouding the new tariffs that the Trump administration is planning on imposing on China is a chief concern for manufacturers. Adding to their concerns was Trumps announcement in March of closing the US-Mexico border, which he backed off from in April. Some respondents pointed out longer wait times for trucks trying to cross the border to the ISM’s survey.

Record 1.3 bn TEUs achieved by Hutchison Ports as they celebrate their 50th anniversary

Hong Kong:During its 50th anniversary cocktail reception recently Hutchison Ports, the world’s leading port investor, developer and operator, announced that it had achieved a cumulative global throughput of 1.3 bn TEUs—the world’s first operator to have achieved this milestone. Lined up end to end, these containers will go around the Earth almost two hundred times, it highlighted in a statement.