BUSINESSBUSINESSThursday 1 February 2018

PAGE | 23PAGE | 22

Commercial Bank to de-risk

legacy assets

Minister of Economy meets Mnuchin & Ross

Qatar & US sign MoU on energy cooperationTHE PENINSULA

DOHA: A memorandum of understanding on energy coop-eration was signed between Qatar and US to create a frame-work for good-faith cooperation in the field of energy between the two friendly countries and to facilitate their sharing of tech-nical knowledge, advice, skills, and expertise.

The MoU was signed on the sidelines of the first strategic Qatar-US dialogue opened on Tuesday in Washington DC.

The Qatar-US dialogue is aimed to strengthen the strategic partnership between the two friendly nations in all fields and the historical ties between Doha

and Washington DC. Qatar’s del-egation was headed by H E Sheikh Mohammad bin Abdul Rahman Al Thani, the Deputy Prime Minister and Foreign Min-ister. The delegation comprised of H E Dr Khalid bin Mohammad Al Attiyah, Deputy Prime Min-ister and Minister of State for Defense Affairs, H E Dr Mohammad bin Saleh Al Sada, Minister of Energy and Industry, H E Sheikh Ahmad bin Jassim Al Thani, Minister of Economy and Commerce and H E Ali Sherif Al Emadi, Minister of Finance.

On the sidelines of the US-Qatar Strategic Dialogue, a meeting on energy Cooperation was held between Dr. Mohammad Al Sada, Minister of

Energy & Industry and US Department of Energy Secretary Rick Perry.

The Memorandum of Under-standing signed between Qatar and the US included among var-ious areas, Oil and Gas Develop-ment; Carbon Capture Utiliza-tion and Storage

→ Continued on page 22H E Dr Mohammad bin Saleh Al Sada (right), Minister of Energy and Industry shakes hand with Rick Perry. US Secretary of Energy, after signing the MoU, in Washington DC, US, yesterday.

The US Department of Energy also presented a Letter of Intent on Nuclear Safeguards.

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22 THURSDAY 1 FEBRUARY 2018BUSINESS

Every year, leaders from across the globe gather in Davos, Switzerland to

discuss the most pressing issues facing the world and plan for the future.

But thinking about what’s coming next isn’t just the pre-serve of multinational CEOs. Every good business leader thinks about future-proofing their company. They spend hours thinking about how and when to expand or diversify and where the next opportu-nity lies.

Sounds easy, but this kind of horizon gazing is hard. Time is precious, information is plentiful but not always acces-sible or reliable, and big change is notoriously difficult to man-age. Listening to the debate in Davos got me thinking about the long-term trends that will have the greatest impact on the businesses I work with. Here are my top six:

Watch out for Gen ZNow 70 million strong, Gen

Z’ers were born between the mid-1990s and the mid-2000s and are the first generation of true digital natives. They’re known for their strong sense of community and desire to positively influence the world through their work. The eldest of this cohort are starting to enter the workplace and are likely to be managed by mil-lennials, another group with strong views on job satisfac-tion. Successful brands will respond by developing strate-gies to address these groups, as employees and as consum-ers. And those companies which live up to their values and understand how to do business in the digital age will be at a competitive advantage. For instance, it’s been shown that ethnically diverse compa-nies are 35percent more likely to outperform their peers .

From ‘Like’ to ‘Buy’, we are social shoppers

More people are buying via social media platforms. When these consumers see a prod-uct that they like, they want to be able to buy it there and then. While social shopping is still in its infancy, research suggests it could generate revenues of $165 billion globally by 2021 . Brands seeking to attract these consumers will need to dial up their social media strategies and move from “Like” to “Buy” buttons, putting their products just a click away from savvy shoppers.

Green is the new blackConsuming ethically has

become more important in recent years. Many people today say they are interested in ethical and environmentally friendly products . It follows that if brands want to be com-mercially successful, they will have to meet these new con-sumer expectations. Big companies are acting on this. Smaller firms, too, are looking at their ecosystem of buyers and suppliers to make sure everyone meets their stand-ards. This isn’t surprising, because if just one company fails consumers, it puts the rep-utation of all parties at risk – just like a domino effect.

Trade skips borders Services such as tourism,

finance and education are expected to account for 25 per-cent of global trade by 2030 . Digital technology makes new markets more accessible and more and more small firms are expanding overseas virtually, without ever setting foot abroad. This is a game-changer for trade, with expansion now being as much about a click of a button as bricks and mortar.

BlockchainToday just 0.5 percent of

the world’s population use blockchain (or Distributed Ledger Technology). But adop-tion is so rapid across so many

industries that experts predict the market will be worth $20bn by 2024 . While some firms are already pioneering the technology, every leader should know how blockchain is being applied to their sector, what proof of concepts have been developed and if there are any collaborative ventures they can join.

The AI march continues Another tech buzzword,

Artificial Intelligence (AI), con-tinues its march into “business as usual”. It’s predicted that AI bots (applications performing automated tasks) will under-pin 85percent of customer service interactions by 2020 , and that this technology could increase productivity by at least 40percent by 2035 . The most promising uses for busi-ness include customer segmentation, in which advanced analytics can be used to identify new customer trends, and segments or clus-ters of people who are more likely to be interested in a par-ticular product.

Business leaders who not only understand these trends but act on them are more likely to f ind competi t ive advantage.

That’s because by future-proofing your firm over the long-term you win new cus-tomers, attract the brightest talent and anticipate where the best opportunities lie.

And that is something com-mon to every successful business, from the smallest start up to the largest multinational.

→ Continued from page 21

The agreement also cov-ers Energy Efficiency and Renewable Energy; Green Building Technologies.

The two sides also dis-cussed ways and means to further develop opportunities for cooperation in the field of energy at large. The US Department of Energy also presented a Letter of Intent on Nuclear Safeguards.

Dr. Al Sada said Qatar looks back with great satis-faction to the close understanding and coopera-tion between the two countries. History of US Energy Companies in Qatar goes back several decades. Major US energy companies are engaged in Qatari energy ventures across Oil, Gas and Downstream Petrochemical and Refining Industry.

Dr Al Sada expressed Qatar’s appreciation to US Companies for their support in the development of Qatar’s Energy Sector, which has mutually benefitted both countries and enabled Qatar to meet the world’s energy needs.

Dr Al Sada added: “We are confident that the spirit of our cooperation expressed through this Strategic Dia-logue will continue to further strengthen this spirit in future”.

Minister of Economy meets Mnuchin & RossTHE PENINSULA

DOHA: HE Sheikh Ahmed bin Jassim Al Thani Minister of Econ-omy and Commerce, yesterday met with US Secretary of the Treasury Steven Mnuchin and US Secretary of Commerce Willbur Ross in separate meetings, on the sidelines of the Qatari-US Stra-tegic Dialogue in Washington.

The two meetings dealt with reviewing economic and invest-ment ties and the means to advance them, in addition to dis-cussing the outcomes of the session on enhancing commerce and investment in the Qatari-US dialogue session, QNA reported.

For his part, the US Secretary of Commerce praised the per-formance of the Qatari economy and expressed his satisfaction of the American companies there. He also highlighted the perform-ance of Qatari investments, which helped create jobs for American citizens.

The Minister also met with Assistant United States Trade Representative Dan Mullaney on the sidelines of the strategic dia-logue. They discussed the outcomes of the latest talks between the United States-Qatar Council on Trade and Investment (TIFA). They also discussed the latest Memorandums of Under-standing and reviewed facets of cooperation in different sectors. The Minister invited the Ameri-can side to hold the next meeting in Doha, which will take place before the end of the current year. He also met with President of the US-Qatar Business Coun-cil Anne Patterson. The American side presented the council’s plan for the next five years.

Sheikh Ahmed also chaired a session on enhancing invest-ment and commerceon the sidelines of the strategic dia-logue, yesterday. He discussed ways to increase trade volume between the two sides and lift

challenges facing investments in the two countries. The two sides also discussed the incentives offered by Qatar to attract for-eign investments.

The Minister stressed on the strength of the historical ties between Qatar and the US and noted that the two sides signed a commerce and investment agreement in 2004 in order to expand cooperation. He also highlighted that the strategic dia-logue was an important step to enhancing ties further.

Qatar and the US have strong investment and commerce ties in the field of oil and gas. Trade volume for 2017 reached $6bn. There are a total of 102 compa-nies 100 percent America companies in Qatar, compared to 505 other companies that are in partnership with a Qatari side. There are also 40 companies that are licensed and work under the umbrella of Qatar Financial Center.

HE Sheikh Ahmed bin Jassem bin Mohammed Al Thani (left), Minister of Economy and Commerce, with US Secretary of the Treasury Steven Mnuchin, in Washington DC, US, yesterday.

Qatar & US sign MoU on energy cooperation

CEO of Dutch landline and mobile telecommunications company KPN, Eelco Blok (right) and CFO Jan Kees de Jager present the company’s 2017 full results, yesterday, in Amsterdam.

Dutch KPN dials up strong profit growth in 2017AFP

THE HAGUE: Dutch telecoms firm KPN hailed a rise in fortunes yesterday, with prof-its up by nearly a third in 2017, despite the end of European roaming charges.

Net profits reached ¤485m ($603m), up 31 percent on 2016 when one-off expenses had hit the group’s bottom line.

Chief executive Eelco Blok attributed the “substantial results” to KPN’s new strategy.

“We have optimised our customer service and deployed a targeted household approach, which resulted in record-high customer satisfaction levels,” he said in a statement.

Profits were also helped by “lower net finance expenses,” KPN said.

Overall revenue, however, fell by 4.5 percent to ¤6.5bn, KPN said, with a year-on-year fall of 2.5 percent in income from mobile phones.

A former state-owned company that was privatised in 1994, KPN has like other tele-coms operators faced stiff competition from free internet call programmes such as Skype and WhatsApp.

The EU also scrapped roaming charges in June 2017, meaning that customers are charged the same for calls, text messages and internet use while travelling in other EU countries as they are at home.

Six ways to ‘future proof’ your business

NOEL QUINN

CHIEF EXECUTIVE, HSBC GLOBAL COMMERCIAL BANKING

CAPITAL TALK

23THURSDAY 1 FEBRUARY 2018 BUSINESS

Commercial Bank to de-risk legacy assetsSATISH KANADY

THE PENINSULA

DOHA: Commercial Bank, Qatar’s third largest lender in terms of assets, yesterday announced its strategic plan to reshape its operating models, which include de-risking of its legacy assets and diversifying of its loan book.

The bank which announced a 20.4 percent year-on-year net profit for the financial year 2017 on Monday, said it would be decreasing its real estate expo-sure from the existing 28 percent to 26 percent and would increase exposure to public sector from the existing 10 per-cent to 13 percent.

“We will de-risk our legacy assets, diversify our portfolio and proactively exit high risk names”, Commercial Bank Group CEO Joseph Abraham said in a media roundtable. “Our Wholesale banking division has exited QR2.8bn of high risk-names in 2016-17. Further exits are planned in 2018,” he added.

The Group CEO said the bank wants to make sure that it’s bringing its corporate earnings quality back to normal. “We have

to make sure the quality of cor-porate earnings is back to at least market levels before outper-forming in the long run,” he said.

Elaborating on the steps taken by the bank for the past 18 months with the support of the Board of Directors, Joseph said with taking closely QR3bn of provisions in 2016 and 2017, the bank’s loan book has been cleaned up for the legacy.

“We have to reduce our con-centration in certain areas, where we are over-concen-trating in the real estate sector. We have a long term programme to reduce it. Similarly, we are under-represented in key growth area , which is public sector and government, which collectively represents 30 percent of Qatari

economy. Only 6-8 percent of our loans are in this sector. We are looking to increase our expo-sure to this sector by 16 percent”, he said.

Joseph said the bank is also looking to reduce the concentra-tion on high-risk clients. The bank has already done a lot of de-risking in this sector for the past 18 months.

The bank expects its loan growth to be in line with the market. It expects a 7 percent to 9 percent growth for the current financial year. In 2017, the bank grew its loan book by 14.8 per-cent. This is ahead of the average market growth, which currently stands between 8-11 percent.

Joseph said the bank has made a drastic 19 percent cut in

‘unnecessary and wasteful’ administrative expenditure in 2017. “We will continue to drive costs lower through reduced waste while simultaneously investing in new technology and branches.”On Commercial Bank’s ongoing discussions

regarding the potential sale of its stake in United Arab Baank (UAB), Joseph said the bank has signed a 90 day exclusivity agreement with Tabarak Invest-ment to negotiate terms of the transaction the sale of Commer-cial Bank’s stake in UAB. The

exclusivity agreement has been extended to February 28, 2018.

He said the bank will inject additional capital in its Turkish subsidiary Alternatifbank and focus more on Turkey to benefit from the growing Qatar-Turkey bilateral ties.

The CEO of Commercial Bank Joseph Abraham (right) along with Abeer Marwan Al Kalla, Head of Marketing Communication and Branding, addressing the media at the Commercial Bank Plaza, West Bay, in Doha yesterday. PIC: SALIM MATRAMKOT/THE PENINSULA

Kenyan inflation rate rises for first month in five in JanuaryBLOOMBERG

NAIROBI : Kenyan inflation accelerated for the first month in five in January as corn prices rose and crude costs increased.

Consumer prices climbed 4.8 percent from a year earlier, the Kenya National Bureau of Statistics said yesterday in a statement emailed from the capital, Nairobi.

Prices advanced 1.3 per-cent in the month.

A government-imposed cap on commercial lending rates, a drought and two dis-puted elections have weighed on economic growth in the world’s largest exporter of black tea.

The central bank has left its key rate at 10 percent since September 2016. Gov-ernor Patrick Njoroge said last week there is a high level of optimism in East Africa’s biggest economy.

Prices of food and non-alcoholic drinks, which make up more than a third of Ken-ya’s inflation basket, rose 4.7 percent in January from a year earlier, and climbed 1.7 percent in the month.

The Energy Regulatory Commission has raised prices at fuel pumps for five straight months as global prices increase.

The country made its final allocation to a pro-gramme to reduce the price of a 90-kilogram (198-pound) bag of corn to 2,300 shillings ($22) from more than 4,000 shillings in October, the Business Daily newspaper reported in the same month.

“With the maize subsidy ending and higher fuel prices, the base is still quite high, and this will suppress the acceleration until at least May,’’ Stephanie Kimani, an economist at Nairobi-based Commercial Bank of Africa Ltd., said by phone before the announcement, using the local term for corn.

“The MPC will take advantage of the low infla-tion-rate environment to adopt a more accommoda-tive stance, particularly if they want hit the 6.2 percent economic growth target for 2018.”

German unemployment rate hits new low in JanuaryAFP

FRANKFURT: Unemployment in Germany hit a new low in January, official figures showed yesterday, as Europe’s largest economy made a strong start to the year while Berlin inches towards forming a government.

Just 5.4 percent of workers were jobless this month, the fed-eral employment agency (BA) said in figures adjusted for sea-sonal and calendar variations, down from 5.5 percent in December. The January figure was the lowest since reunifica-tion in 1990 and in line with analysts’ expectations.

“The labour market entered the new year with a lot of momentum,” BA chief Detlef Scheele said in a statement.

In unadjusted terms -- less representative of underlying trends but closely followed in public debate -- the jobless rate increased 0.5 percentage point

to 5.8 percent and the jobless total increased by 185,000 to 2.57 million.

“The number of jobless people did rise, but it was less than usual at this time of year,” Scheele noted.

High demand for German goods abroad, strong domestic demand powered by consumers and supportive policies from the European Central Bank have bolstered the recovery in Europe’s largest economy.

And surveys of consumer, business and investor confi-dence are positive, even as Chancellor Angela Merkel’s bid to assemble a governing coali-tion drags on in the wake of Sep-tember elections.

The strong economic pic-ture has encouraged metal-workers to demand big conces-sions from bosses in wage talks, with union IG Metall insisting on a 6.0-percent wage rise and the right to switch temporarily to

part-time hours. Thousands of workers are

participating in 24-hour “warning strikes” this week to raise the pressure on employers. Other unions could be encour-aged to follow suit in an economy where skilled workers are increasingly hard to come by.

Meanwhile, BA figures also showed that the large numbers of migrants and refugees that have arrived in Germany helped boost the count of so-called “underemployed” people to 7.7 percent, up 0.3 percentage point. On top of the main job-less figure, the underemployed tally includes groups like the temporarily sick or people in government-subsidised jobs or training.

So far, many refugees have yet to show up in the headline unemployment figure as they are still enrolled in integration or language courses.

Job seekers standing in line at an unemployment office in Germany.

Samsung Electronics reports record Q4 and full-year profitsAFP

SEOUL: Samsung Electronics reported a 73 percent jump in its fourth quarter net profit yesterday, setting a record for any three-month period, mainly driven by demand for its memory chips and display panels.

Net profit for the October to December period hit 12.26 tril-lion won ($11.4bn), the South Korean tech giant said in a state-ment, on sales up 23.7 percent

to 65.98 trillion won. Samsung Electronics, the flagship subsid-iary of the giant Samsung Group, has had to overcome a humili-ating recall of the Galaxy Note 7 device and the jailing of its vice-chairman Lee Jae-Yong on cor-ruption charges, but its financial performance has gone from strength to strength.

Its shares have more than doubled in the past two years on the back of its results, reaching levels of more than 2.5 million won apiece, putting them out of

reach of many small investors. The firm announced a

50-for-1 stock split, sending the shares up 6.4 percent in mid-morning trade, but they gave up most of the gains to heavy profit-taking to close just 0.2 percent higher at 2,495,000 won.

“The stock split signals Sam-sung will stay on its course bol-stering returns to shareholders,” said Cho Ik-Jae at Hi Investment and Securities. “It will take fur-ther shareholder-friendly steps including larger dividends and

buybacks,” he added. Operating profit came to 15.15 trillion won in the fourth quarter, up 64.3 percent won from a year earlier, Samsung Electronics said, in line with the indication it issued ear-lier in January.

Fourth quarter earnings were driven by the components business, with the largest con-tribution coming from the memory business that manufac-tures DRAM and NAND chips, the company said.

“ O r d e r s f o r

high-performance memory products for servers and mobile storage were strong,” it said, and the display panel business, which manufactures OLED and LCD screens, saw increased ship-ments of OLED panels for pre-mium smartphones.

But seasonal factors impacted growth for the System LSI and Foundry businesses, it said, and profitability for LCD panels. Earnings in the mobile business also fell on the back of higher marketing costs.

The bank will be decreasing its real estate exposure from the existing 28% to 26% and would increase exposure to public sector from the existing 10% to 13%.

The bank’s loan book has been cleaned up

for the legacy

Boeing reports jump in earnings; upbeat on 2018AFP

NEW YORK: Boeing reported a jump in fourth-quarter earn-ings yesterday thanks to higher commercial plane deliveries and a boost from US tax reform as it projected more strong results in 2018.

Shares of the US aerospace giant powered higher after it reported net profit in the fourth quarter of $3.1bn, up a stunning 92 percent from the year-ago period.

Revenues came in at $25.4bn, up nine percent from the equivalent stretch in 2016, strengthened by higher com-mercial plane deliveries and increased defense revenues from deliveries of weapons systems.

Boeing has benefited from rising demand for commercial aircraft as airlines score higher profits and boost orders.

“Across Boeing our teams delivered a record year of financial and operational per-formance as they focused on disciplined execution of pro-duction and development pro-grams, growing services, and delivering value to customers,” Boeing chief executive Dennis Muilenburg said.

Earnings were lifted by $1.1bn following passage of US tax reform, which permitted Boeing to reduce its deferred tax liabilities.

The company’s forecast for 2018 included higher revenues, earnings per share and profit margins in its commercial air-plane, defense and global serv-ices divisions. It projected

commercial plane deliveries of 810 to 815 this year, which would exceed the record 763 in 2017.

Boeing has raised produc-tion rates of key vehicles as they have become more seasoned in the company’s manufacturing system, enabling higher profit margins.

The company plans to increase output of the single-aisle 737, its most popular offering, from 47 a month to 52 later this year and to 57 in 2019.

Boeing is well positioned “for continued growth into and beyond 2020,” Credit Suisse said in a note. “We think the Dow’s 2017 darling will con-tinue to attract strong support in 2018 too.”

Although analysts consider Boeing’s prospects to be gener-ally bright, it faces questions over how it will respond to a surprise setback last week in a trade dispute involving Cana-da’s Bombardier.

The US International Trade Commission voted to block the Commerce Department’s deci-sion to impose heavy tariffs on Bombardier in response to Boe-ing’s complaint that the Cana-dian company received unfair subsidies.

Boeing expressed disap-pointment with the decision, but has not said whether it will appeal through the courts.

And the status of Boeing’s talks with Brazilian aerospace conglomerate Embraer remains unclear. The two companies confirmed they were in talks on a potential combination in December.

24 THURSDAY 1 FEBRUARY 2018BUSINESS

EU rejects London’s Brexit plan for banks REUTERS

LONDON: European Commis-sion officials have rejected the City of London’s proposal to strike a post-Brexit free trade deal on financial services, a major blow to Britain’s hopes of keeping full access to EU markets for one of the world’s top two financial centres.

Since Britain voted to leave the EU 19 months ago, some of the world’s most powerful finance companies in London have been searching for a way to preserve the existing cross-border flow of trading after it leaves the bloc in 2019.

Officials from the European Union’s executive told British fin-anciers in meetings in recent weeks they won’t agree to a deal that would allow finance com-panies to operate in each others’ markets without barriers because Britain has said it will leave the single market, accord-ing to two people who attended the meetings.

The City’s plan proposed that Britain and the EU would allow cross border trade in financial services on the condi-tion that each side preserve regulatory standards in line with the best international standards. This model would be main-tained by close co-operation between regulators and finan-cial policymakers.

The proposals were the most detailed on how a long-term agreement on financial services with the EU may work after Brexit, with papers setting out how a pact could be struc-tured and policed, and it has been endorsed by Britain’s Brexit minister David Davis.

But EU officials are dismiss-ive of any trade models that

would see Britain retain similar levels of market access while leaving the single market regime.

“They have made it very clear to us that this is unaccept-able to them,” said one senior British finance executive present at one of the meetings. “This was our best and frankly only pro-posal. We don’t have a plan B.”

Sterling slipped against the dollar and euro on Wednesday on news of the rejection.

Britain’s vast financial serv-ices looks set to be one of the most divisive areas in the Brexit negotiations, with Britain demanding a generous deal while the EU refuses to shift from its insistence that Britain’s red lines -- such as ending the free movement of workers from the EU -- make that impossible.

Britain is currently home to the world’s largest number of banks and hosts the largest commercial insurance market. About six trillion euros ($7.47 trillion), or 37 percent, of Europe’s financial assets are managed in the UK capital, almost twice the amount of its nearest rival, Paris.

In addition, London

dominates Europe’s 5.2 trillion euro investment banking industry.

But unless it can secure a trade deal, for all its geographic proximity, Europe’s largest financial capital will end up adrift with the same access to the EU as other countries like Singapore.

Britain’s finance minister Philip Hammond warned Europe last week that hurting London’s financial centre would push busi-ness to New York and Singapore to the detriment of Europe as a whole, and he called for a bespoke trade deal with the EU. The rejection of the proposed trade deal represents a second setback for the City of London, which had initially pinned hopes on Britain maintaining “pass-porting” in financial services after Brexit.

European Union negotiators see no room for discussion with Britain on passporting, diplomats in Brussels said on Wednesday.

Mark Hoban, a former City minister who chaired the body that wrote the blueprint, acknowledged it was ambitious but said it has the interest of government and was being dis-cussed by EU states.

Siemens profits up on global upturnAFP

FRANKFURT: German engi-neering giant Siemens said yesterday that profits jumped in the first quarter of its financial year, driven by rising demand for its products in areas ranging from renewable energy and trains to industrial robots.

Siemens, which runs its business year from October to September, said in a statement net profit jumped by 12 percent to ¤2.2bn ($2.7bn) in the three months to December.

Underlying or operating profit was also up 12 percent at ¤2.2bn while first-quarter sales grew by three percent to ¤19.8bn. But chief executive Joe Kaeser warned there was much to do to future-proof the indus-trial behemoth.

“Traditional conglomerates don’t have a future. We have to lay the foundations now for the next-generation Siemens,” he said.

Kaeser’s ambitious plans to restructure the sprawling group include planned factory closures in the struggling gas turbine

business and a stock market flo-tation for the valuable medical devices division.

The medical devices unit saw orders, revenue and prof-its fall back slightly in the first quarter, due to “significant cur-rency headwinds”, but Siemens said the unit remained on track for its initial public offering.

In the power and gas divi-sion, profits fell by almost half and orders and revenue declined as demand for its power plant turbines fell away.

Siemens announced a mas-sive restructuring in November, cutting nearly 7,000 job cuts worldwide in the traditional power plant building business.

“We are convinced there will be a global market for gas turbines, and that is why we are still investing,” Kaeser said.

“But the market will be smaller and won’t be in Europe, rather in China, the US and in the Middle East.”

Other units of the Munich-based giant were in much healthier shape and “taking advantage of the global eco-nomic upturn,” he added.

Orders at Siemens’ wind energy unit surged after a merger with Spanish firm Gamesa was finalised, even if profits shrank slightly over the quarter.

In the factory automation division, orders and revenue jumped, especially in China, although the effects of a recent acquisition sapped profits.

The train construction divi-sion, which recently announced a tie-up with French rival Alstom, reported a surge in orders, revenue and profits after it secured new contracts in Europe, Israel and the United States and its latest high-speed trains entered service in Germany.

Looking ahead to the full year, Siemens was more cau-tious, saying that continuing headwinds in the energy mar-ket and “geopolit ical uncertainties” painted a more “mixed picture”.

It said it was pencilling in “modest growth in revenue” and earnings per share around the same level as in the 2016/2017 business year.

FROM LEFT: Michael Sen, member of the board, Siemens; Janina Kugel, Chief Human Resources Officer; Ralf P Thomas, CFO; and Joe Kaeser, CEO, during Siemens’ annual shareholder’s meeting at the Olympic hall in Munich, southern Germany, yesterday.

Greece wants clean break from lenders; preparing own post-bailout planREUTERS

ATHENS: Greece expects to make a clean break with official lenders when its international bailout expires in August and has no reason to seek a precaution-ary credit line, its finance minister said in an interview.

Instead, Euclid Tsakalotos (pictured) said, the country is building up its own protective buffer that, along with unused European bailout funds, will cover Greece “for well over a year”, if needed.

In coming months, he said, the country would be preparing its own post-bailout plan with an emphasis on reforms, social policies and growth.

He also said discussions would soon commence with euro zone lenders on debt relief along the lines of a French proposal to link the level of debt restructur-ing to economic performance.

“We feel we have built cred-ibility over the last three years,” Tsakalotos said.

Greece is close to emerging from a sovereign debt crisis that plunged the economy into its

biggest depression in decades, threatening to rupture the euro zone. It has received a record ¤260bn in repeated bailouts since 2010.

The government has vowed to end the humiliation of auster-ity imposed on Greece by its international lenders, but the nation still has a debt burden of 178 percent of economic output and some European policymak-ers believe Athens cannot go it alone without debt relief and a standby line of credit.

A precautionary credit line, though, would come with yet more conditions attached, so Athens is proposing its own plan. It is also creating a safety net of up to ¤19bn drawn from lefto-ver, unused bailout funds and from bond issues.

Post-programme surveil-lance schemes were common to other European member states which sought financial aid, Tsakalotos said. But Greece’s own post-bailout plan would be more pro-active.

It would, he said, show lend-ers and the markets that Greece had ownership over its own

programme of future reforms and growth strategies, rather than Brussels.

“We are thinking of prepar-ing our own plan .. to show both the institutions but also the mar-kets that it is our programme, it has ownership... it hasn’t been imposed, it’s not a matter of compromise,” he said.

Tsipras’ left-led coalition shocked markets and its lenders when it was catapulted to power in 2015 promising to reverse

reforms and tear up the coun-try’s bailouts.

But it was later forced to cave into lenders’ demands for more austerity under a new rescue package. That ¤86bn loan pack-age ends in August.

Tsakalotos said that the economy was turning a corner and the country was ready to stand on its own feet soon.

“We’ve been outperforming our fiscal targets, the economy is returning,” he said. “To those people who think we need some-thing more, like a precautionary credit line or whatever, they are just pushing the key question back and I don’t see any reason for that,” Tsakalotos said.

The International Monetary Fund has not yet decided if it will participate in Greece’s latest bail-out programme, having repeatedly voiced concern at the sustainability of the country’s debt pile.

“I think their inclination and their strategy is to get a deal that makes the Greek debt sustaina-ble so they can come on board,” he said.

Athens last week concluded

a review of its bailout progress and has yet to undergo a final check before its programme ends. It hopes to start talks on medium-term debt relief soon, mindful of ballooning debt because of this aid, and now hopes to start talks on medium-term debt relief measures.

Greece and its lenders are expected to flesh out a French proposed mechanism which was presented in June and will link debt relief to Greece’s growth rates. The economy is expected to grow by up to 2.5 percent this year and in 2019.

“What we will be going over the next month or so is working out the nitty-gritty of it, the mechanism, how it will kick in, when it will kick in,” Tsakalotos said adding that a kind of sub-committee of the Euro working group would handle this.

Details on the cash buffer, the growth mechanism along with the implementation of the measures agreed in June would give investors clarity over Greece’s trajectory, he said.

Greece returned to bond markets in July after three years

of market isolation. Another issue would follow “soon”, he said.

“The only outstanding issue is the composition of that buffer, how much will come from Greece’s own funds, and how much will come from the ESM and I’m looking forward to that debate.”

Greek banks are saddled with about ¤100bn in bad loans (NPLs), after a seven-year depression that cut economic output by a quarter and pushed more than a fifth of the popula-tion into unemployment.

The results of stress tests on the banks by euro zone supervi-sors are expected in May.

“We shall see what the results of the stress tests are,” said Tsakalotos. “I think that a lot of people would want to give banks a chance to see all these bits of the puzzle that we put in to work through, and to address the NPL problem.”

“The good thing is that it’s going to have the same criteria across the European banking system, it’s not like it’s picking Greece as an exceptional case.”

The City’s plan pro-posed that Britain and the EU would allow cross border trade in financial services on the con-dition that each side preserve regulatory standards in line with the best international standards.

The rejection of the proposed trade deal represents a second

setback for the City of London

China factory gauge weakened amid pollutionBLOOMBERG

BEIJING: China’s official factory gauge missed estimates as efforts to rein in debt and reduce pollution dragged on activity.

The manufacturing pur-chasing managers index slipped to 51.3 in January, compared with a 51.6 forecast in a Bloomb-erg survey of economists and 51.6 the prior month, the National Bureau of Statistics said yesterday.

The non-manufacturing PMI rose to 55.3 from 55 in Decem-ber. A new composite index covering both services and manufacturing was released for

the first time; it stood at 54.6. Numbers above 50 indicate improving conditions while t h o s e b e l o w s i g n a l deterioration.

The economy capped its first full-year acceleration since 2010 amid a broad global recovery and industrial reflation.

While the earliest indicators signal a solid start for this year, policies to purge pollution and excessive borrowing may weigh on growth in coming months, testing policy makers’ resolve to clean up both the environment and the financial system.

New buses lined up for export at a port in Lianyungang, east China’s Jiangsu province yesterday

Mexico to hold major deep-water oil auctionAFP

MEXICO CITY: Mexican authorities are all set to hold a deep-water oil auction, the largest since the country’s government opened the sector to private industry.

So far 26 companies from 16 countries -- among them US heavyweights Exxon and Chev-ron, as well as the British-Dutch Shell and France’s Total -- are qualified to participate in the

auction of 29 oil blocks in the Gulf of Mexico, according to Mexico’s oil regulator. The auc-tion follows a major energy reform in 2013 that saw the state-owned Pemex lose its seven-decade-old monopoly on hydrocarbon production.

With the landmark change, President Enrique Pena Nieto cleared the path for auctions in a bid to inject foreign capital into the politically-sensitive state-owned oil industry.

25THURSDAY 1 FEBRUARY 2018 BUSINESS

Fujifilm gains control of Xerox to form $18bn firmBLOOMBERG

TOKYO: Fujifilm Holdings Corp is gaining control of Xerox Corp in a deal that would create an $18bn company and see the iconic American corporate giant launching into new lines of business to seek global growth.

The deal would com-bine Xerox, which has a market value of $8.3bn, with a joint venture the company operates with Fujifilm, according to a statement issued yes-terday. Xerox share-holders will receive a $2.5bn special cash divi-dend, or approximately $9.80 per share, funded from the combined com-pany’s balance sheet, and own 49.9 percent of the combined company at closing.

The joint venture will also cut 10,000 jobs glo-bally as Fujifilm under-takes a restructuring, the Japanese company announced Wednesday. The new combined com-pany, Fuji Xerox, will trade on the New York Stock Exchange and have dual headquarters in

Norwalk, Connecticut and Tokyo.

The deal marks the end of independence for a US company whose roots trace back to the start of the 20th century. While Xerox became famous for its hardware, it has fallen on hard times as Canon Inc. and other competitors from Asia eroded its dominance and email and other forms of electronic communica-tions took over.

The new company will accelerate revenue growth through its global reach and pursue devel-opments in inkjet, imaging and artificial intelligence, it said.

“The proposed com-bination has compelling industrial logic and will unlock significant growth and productivity oppor-tunities for the combined company, while deliv-ering substantial value to Xerox shareholders,” Jeff Jacobson, chief executive officer of Xerox, said in the statement. Jacobson will become CEO of the combined company.

The deal was reported earlier by the Wall Street

Journal. Fujifilm Holdings, which lowered its forecast for operating income for the year ending March 31, will cut one-fifth of its global workforce at the joint venture as the Japa-nese company struggles with an “increasingly severe” market environ-ment. The company said it will incur a one-time expense of 72 billion yen ($662m) over three years.

Fujifilm’s stock plunged in the final min-utes of trading in Tokyo on Wednesday, dropping more than 8 percent to the lowest level since August.

Xerox and Fujifilm’s 55-year-old joint venture in Asia is the subject of a recent accounting probe into its practices in New Zealand and Australia, which prompted activist investor Carl Icahn to call for renegotiating or scrap-ping the agreement.

Icahn this month teamed up with fellow Xerox investor Darwin Deason to urge the com-pany to explore strategic alternatives and shake up its joint venture with Fuji-film. The pair -- Xerox’s first and third largest

shareholders, respectively -- called for Xerox to immediately replace Jacobson. Fujifilm, which generates almost 60 per-cent of sales from over-seas, is pushing to offset waning demand at its printer and copier hard-ware business by shifting focus to managed-print services and medical imaging. Expansion into

the health-care sector with products such as ultrasound and endoscope equipment should boost sales, but that segment’s thinner margins could offset gains in the imaging division, according to Bloomberg Intelligence. The deal will make for a more global company, according to Simon Chan, an analyst at Bloomberg

Intelligence. “In the past, Fuji

Xerox only operated in the Asia Pacific region, and Xerox targets the Amer-icas and Europe,” Chan said.

“With the combined company, they can share cost on research, product development and poten-tially manufacturing capacity as well.”

Fujifilm Holdings’ Chief Executive Officer Shigetaka Komori (left) and Chief Operating Officer Kenji Sukeno greet attendees after their news conference in Tokyo, Japan ,yesterday. The deal would combine Xerox, which has a market value of $8.3bn, with a joint venture the company operates with Fujifilm.

Brexit won’t affect UK ties: Chinese PremierREUTERS

BEIJING: China’s relations with Britain will remain unchanged through Brexit, Premier Li Keqiang said yesterday, as British Prime Minister Theresa May kicked off a three-day visit to China, where she aims to sign nine billion pounds in deals.

Britain is trying to reinvent itself as a global trading nation after a 2016 referendum deci-sion to leave the European Union, but Brexit has unnerved Beijing, even as London hopes to sign a free trade deal with the world’s second-largest economy.

Speaking to reporters after meeting May in Beijing’s Great Hall of the People, Li proffered support for relations between the two countries, which both like to refer to as being in a “golden era”.

“Our relationship will not change because of changes in Britain-Europe ties,” Li said.

But he acknowledged there would need to be an adaption.

“While we must adapt to these changes, we will assess and talk about future bilateral trade and investment arrangements, to continue to push forward China-Britain relations, including trade and business ties.”

May, who is perceived to be less keen on courting China than her predecessor, David Cameron, said she was committed to deep-ening the relationship in light of Brexit and would explore all options in future trade ties.

“We are determined to deepen our trading relationship even further and we are ambi-tious for what our future trade relationship will be,” she said.

May said the two countries would agree on more than nine billion pounds worth of deals during her visit, and that China had agreed to lift a ban on British beef exports within the next six months.

“We have also agreed to open up the Chinese market to enable our great UK financial services expertise to reach more Chinese consumers.”

Speaking earlier on her way to the central Chinese city of Wuhan, May said Britain was seeking a free trade agreement with China, adding that more should be done immediately to open up market access for British firms.

“China is a country that we want to do a trade deal with,” May told reporters aboard her Royal Air Force jet on the way to the university city.

“But, I think that there is more we can be doing in the interim...in terms of looking at potential barriers to trade and the opening up of markets to ensure...British businesses able to do good trade into China.”

China accounts for just a small proportion of British exports, 3.1 percent in 2016, versus 43 percent for the Euro-pean Union.

While diplomatic sources say China has expressed willingness to talk about a future free trade deal with Britain, formal talks cannot begin until Britain offi-cially leaves the EU next year. Free trade talks typically take many years to conclude.

Britain has also pushed a strong message to Chinese com-panies that it is fully open for business.

Notable Chinese investments in Britain include the Hinkley C nuclear power station which is being built by China General Nuclear Power Corp and the British arm of France’s EDF, while British firms, such as Rolls Royce, have won large deals from Chinese firms to supply items like plane engines.

Both May and senior Chinese officials have restated their com-mitment to the “golden era” in

ties but a row over May’s deci-sion to delay approval for the Chinese-funded Hinkley nuclear plant in late 2016 chilled relations.

However, Britain was the first Western country to sign up to the China-backed Asian Infrastruc-ture Investment Bank and it sent Finance Minister Philip Ham-mond to a Beijing summit last year about President Xi Jinping’s flagship ‘Belt and Road Initiative’ - a trillion-dollar infrastructure-led push to build a modern Silk Road.

May said the Belt and Road

had huge potential and that Britain was a “natural partner”, but cautioned that projects had to carried out in the proper way.

“We’ve discussed how the UK and China will continue to work together to identify how best we can cooperate on the Belt and Road initiative across the region and ensure it meets international standards,” she said in Beijing.

Speaking earlier, May said she would raise the future of Hong Kong in her meetings with Xi, underlining Britain’s commit-ment to the ‘one country, two systems’ rule in the former British

colony.Britain’s last governor in Hong Kong before it was handed back to the Chinese, Chris Patten, had written to May on Monday urging her to raise concerns over the “increasing threats to the basic freedoms, human rights and autonomy” in the territory.

Hong Kong was rocked by pro-democracy protests in 2014 in the largest show of defiance against Beijing rule since 1997. The government has since cracked down on activists, including last week banning one from running in a by-election in March.

British Prime Minister Theresa May (left) and Chinese Premier Li Keqiang listen to a speaker during the inaugural meeting of the UK-China CEO Council at the Great Hall of the People in Beijing yesterday.

Paris International Automobile FestivalVisitors look at the “Proceed” concept car by South Korean car manufacturers KIA, displayed at The International Automobile Festival in Paris, France, yesterday.

Ex-JPMorgan trader loses London Whale identity suit against FCABLOOMBERG

LONDON: A former JPMorgan Chase & Co trader wasn’t improperly identified by the UK markets regulator in its settle-ment report over the London Whale scandal, a court ruled, upholding a Supreme Court deci-sion on the wider issue last year.

The Financial Conduct Authority adequately ano-nymized Julien Grout’s identity in its $195m London Whale set-tlement with the bank in 2013, a three-judge panel said Wednesday. The judgment draws a line under the question of how individuals are referred to by the FCA in penalty notices and over-turns a 2016 lower court deci-sion in favor of Grout, who was one of four members working on the bank’s synthetic credit port-folio. “I cannot accept that the

phrase ‘the traders on the SCP’ is a synonym for Mr. Grout,” said Judge Andrew Longmore, who wrote the ruling. “It is so delib-erately vague that it can legiti-mately be described as ‘anony-mous’ rather than ‘synonymous.’ ”

For years the FCA used monikers such as “Trader A” in settlement notices with firms to get around a requirement that a person must be given the chance to respond to allegations if they were identified. The anonymity allowed the agency to illustrate misconduct by publishing an account of events and transcripts of chats while avoiding any delay in issuing the sanction.

But the FCA faced a number of claims from traders in recent years who said the regulator had failed to properly anonymise them or give them a chance to

respond to allegations. In a big win for the regulator, the UK Supreme Court said in March that a person was only identified if the general public at large could decipher who they were, not just banking peers, which led to every trader except Grout dropping their claim.

Grout contended that he could be identified because of the small number of traders on the SCP.

JPMorgan was fined more than $1bn by US and UK regula-tors in 2013 after Grout’s boss, Bruno Iksil, nicknamed the London Whale for his large bets, incurred $6.2bn in losses at the lender. The UK Supreme Court case related to another former JPMorgan executive, Achilles Macris, who also claimed he was wrongly identified in the London Whale notice.

Bond markets headed for worst month in over a yearREUTERS

LONDON: Bond markets in Europe and the United States looked set on to end January with their worst month since late 2016, a sign that the tide for bonds has turned as a stronger world economy spells the end for ultra-easy monetary policies.

Eurozone government bond yields fell yesterday as data showed euro zone infla-tion was still missing the European Central Bank’s target, while ECB policymaker Benoit Coeure warned that monetary stimulus was still needed. However, the overall trend is for higher bond yields across the bloc. The yield on Germany’s 10-year govern-ment bond, the benchmark for the region, is up about 25 basis points in January at 0.676 percent and set for its biggest monthly rise since October 2016. Germany’s bond yield curve is close to its steepest in around six months, with the gap between 2 and 10-year bond yields around 121 bps, up from 106 bps a month ago.

26 THURSDAY 1 FEBRUARY 2018BUSINESS

QATAR STOCK EXCHANGE

QE Index 9,204.62 1.33 %

QE Total Return Index 15,435.60 1.33 %

QE Al Rayan Islamic Index - Price 2,355.65 1.61 %

QE Al Rayan Islamic Index 3,630.75 1.61 %

QE All Share Index 2,590.84 1.55 %

QE All Share Banks &

Financial Services 2,836.13 1.57 %

QE All Share Industrials 2,845.21 1.55 %

QE All Share Transportation 1,999.02 0.98 %

QE All Share Real Estate 1,984.17 1.47 %

QE All Share Insurance 3,393.56 3.41 %

QE All Share Telecoms 1,095.86 0.99 %

QE All Share Consumer

Goods & Services 5,426.09 0.87 %

QE INDICES SUMMARY QE MARKET SUMMARY COMPARISON WORLD STOCK INDICES

GOLD AND SILVER

31-01-2018Index 9,204.62

Change 123.62

% 1.33

YTD% 7.99

Volume 9,471,431

Value (QAR) 267,733,578.01

Trades 4,643

Up 07 | Down 33 | Unchanged 130-01-2018Index 9,328.24

Change 121.83

% 1.29

YTD% 9.44

Volume 8,763,401

Value (QAR) 229,949,616.84

Trades 3,696

EXCHANGE RATE

GOLD QR157.6460 per grammeSILVER QR2.0235 per gramme

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

All Ordinaries 6146.5 11.2 0.18 6256.5 6106.2

Cac 40 Index/D 5487.97 14.19 0.26 5567.03 5258.66

Dj Indu Average 26076.89 -362.59 -1.37 26616.71 19784.77

Hang Seng Inde/D 32887.27 279.98 0.86 33484.08 30028.29

Iseq Overall/D 6983.29 -0.18 0 7257.41 6968.8

Kse 100 Inx/D 44049.05 -184.06 -0.42 45494.52 40169.62

S&P 500 Index/D 2822.43 -31.1 -1.089878 2872.87 2682.36

Currency Buying SellingUS$ QR 3.6305 QR 3.6500

UK QR 5.1190 QR 5.1908

Euro QR 4.5076 QR 4.5706

CA$ QR 2.9390 QR 2.9970

Swiss Fr QR 3.8800 QR 3.9352

Yen QR 0.03318 QR 0.03383

Aus$ QR 2.9255 QR 2.9841

Ind Re QR 0.0568 QR 0.0579

Pak Re QR 0.0325 QR 0.0333

Peso QR 0.0704 QR 0.0718

SL Re QR 0.0234 QR 0.0239

Taka QR 0.0433 QR 0.0442

Nep Re QR 0.0355 QR 0.0362

SA Rand QR 0.3048 QR 0.3108

INTERNATIONAL MARKETS - A LIST OF SHARES FROM THE WORLD

Aarti Drugs-B/D 626.3 -15.45 1755

Aban Offs-A/D 210.9 -2.75 236267

Acc Ltd-A/D 1716.4 -13.1 8292

Ador Welding-B/D 499.1 -3.7 1296

Aegis Logis-A/D 248.5 -3.35 22938

Alembic-B/D 64.8 0.1 405848

Alkyl Amines-B/D 703 -28.6 1738

Alok Indus-T/D 3.55 -0.03 647391

Apollo Tyre-A/D 254.75 -4.05 129103

Asahi I Glass-/D 347.7 4.5 815875

Ashok Leyland-/D 125.95 0.3 411978

Bajaj Hold-A/D 2851 65.75 1234

Ballarpur In-B/D 15.7 0.85 670097

Banaras Bead-T/D 65 -1.6 1027

Bata India-A/D 704.5 -7.65 14079

Beml Ltd-A/D 1448.3 -30.25 15829

Bhansali Eng-B/D 169.75 -0.25 253315

Bharat Bijle-B/D 1358.25 -9.25 7082

Bharat Ele-A/D 169.4 -7.85 609227

Bharat Heavy-A/D 100.25 -1.35 814480

Bharatgears-B/D 195.9 -3.65 7686

Bom.Burmah-X/D 1398.6 -30.75 19938

Bombay Dyeing-/D 227.85 -3.3 425265

Camph.& All-X/D 1106.95 -1.75 1042

Canfin Homes-A/D 450 0.55 40155

Caprihans-X/D 101.2 -0.95 4187

Castrol India-/D 183.75 -0.5 262980

Century Enka-B/D 322.8 -4.7 4731

Century Text-A/D 1386.6 -14.3 38102

Chambal Fert-A/D 160.4 5.1 161577

Chola Invest-A/D 1285.9 1.65 27354

Chowgule St-Xt/D 14.8 -0.15 1146

Cimmco-T/D 113.65 0.65 9624

Cipla-A/D 587.45 -19.1 1642356

City Union Bk-/D 159.6 -3.35 26522

Colgate-A/D 1120.45 -19.1 15590

Container Cor-/D 1390.55 11.05 18395

Dai-X/D 429 12.6 3587

Dcm Shram Ind-/D 260.2 0.6 27268

Dhampur Sugar-/D 190.05 7.45 132166

Dr. Reddy-A/D 2225.25 -86.75 132603

E I H-B/D 192.1 -6.35 13985

E.I.D Parry-A/D 328.65 3.95 44076

Eicher Motor-A/D 26948.9 295.8 3628

Electrosteel-B/D 33.95 -0.6 91330

Emco-B/D 19.95 -0.4 31957

Escorts-A/D 813.1 -20.1 497423

Eveready Indu-/D 417 -0.65 16172

F D C-B/D 228.7 -8.95 8079

Federal Bank-A/D 100.45 -0.25 1569728

Ferro Alloys-X/D 12.4 0.1 60227

Finolex-A/D 643.2 3.45 5541

Forbes-B/D 3875 -78.75 3697

Gail-A/D 478.3 1.35 258807

Galada Power-X/D 7 0 1160

Gammon India-T/D 6.46 0.02 92741

Garden P -B/D 39.85 -0.5 27726

Godfrey Phil-A/D 921.85 -37.85 20553

Goodricke-X/D 438.85 -3.4 12295

Goodyear I -B/D 1121.9 -0.5 9225

Hcl Infosys-A/D 53.5 -0.45 406416

Him.Fut.Comm-A/D 29.2 -0.4 1667554

Himat Seide-X/D 350 -2.4 773826

Hind Motors-T/D 8.99 -0.05 84127

Hind Org Chem-/D 28 -0.85 49562

Hind Unilever-/D 1369.65 -29.8 82869

Hind.Petrol-A/D 396.5 4.2 467542

Hindalco-A/D 255.85 1.9 1014953

Hous Dev Fin-A/D 1955.55 22.3 84913

Idbi-A/D 60.35 -0.6 777657

Ifb Ind.Ltd.-B/D 1281 -21.1 4124

Ifci Ltd-A/D 28.5 -0.25 1443819

India Cement-A/D 167.9 -1.25 321909

India Glycol-B/D 520.05 0.3 49463

Indian Hotel-A/D 137.75 -5.1 136226

Indo-A/D 103.95 -1.75 108860

Indusind-A/D 1755 18.3 38861

J.B.Chemical-B/D 308 -3.35 10097

Jagatjit Ind-X/D 94.65 -4.95 5808

Jagson Phar-B/D 35 -0.2 2646

Jamnaauto-B/D 72.9 -1.7 224900

Jbf Indu-B/D 182 -9.65 21001

Jct Ltd-X/D 3.71 -0.01 288776

Jenson&Nich.-T/D 5.95 -0.03 21431

Jindal Drill-B/D 187.95 -1.25 58729

Jktyre&Ind-A/D 175.2 -0.5 175621

Jmc Projects-B/D 547 2.75 68248

Kabra Extr-B/D 125 -1.8 10232

Kajaria Cer-A/D 633.7 -41.2 82376

Kakatiya Cem-B/D 366.45 1 9353

Kalpat Power-B/D 449.35 -16.1 19571

Kalyani Stel-B/D 347.2 -3.55 22852

Kanoria Chem-B/D 88.5 -2.5 19823

Kg Denim-X/D 63.4 -0.4 6740

Kilburnengg-X/D 90.25 -1.9 21143

Kinetic Eng-Xt/D 86 -0.85 19465

Kopran-B/D 73.55 -0.85 60829

Lakshmi Elec-X/D 703.5 -71.5 13488

Lakshmi Mach-A/D 6004.9 -95.6 1478

Laxmi Prcisn-B/D 52 -0.7 14242

Lgb Broth-B/D 987.45 -32.55 3724

Lloyd Metal-X/D 17.65 -0.4 48471

Lupin-A/D 883.65 -19.75 170167

Lyka Labs-B/D 63 -1.9 26530

Mafatlal Ind-X/D 315 15.25 113772

Mah.Seamless-B/D 501.1 -5.4 24196

Mangalam Cem-B/D 415.85 6.75 143948

Maral Overs-B/D 40.45 -0.7 25620

Mastek-B/D 479 13.05 122559

Max Financial-/D 533.6 5.25 21320

Mrpl-A/D 128.2 -0.45 135784

Nagreeka Ex-T/D 37.75 -1.95 2925

Nahar Spg.-B/D 117.65 -0.75 17445

Nation Alum -A/D 75.3 -0.2 762460

Navneet Edu-B/D 148 5.55 8047

Neuland Lab-B/D 841.8 0.9 1125

Nrb Bearings-B/D 163.1 -1.55 8500

O N G C-A/D 203.35 -0.45 713133

Oil Country-B/D 50.7 -1.05 7040

Onward Tech-B/D 101.9 1.95 18452

Orchid Pharm-M/D 17.6 -0.1 102678

Orient Hotel-B/D 55.3 -0.85 37910

Orient.Carb.-B/D 1214.9 -33.45 5183

Orient.Carb.-B/D 1214.9 -33.45 5183

Patspin India-/D 23.65 -0.3 7165

Punjab Chem.-X/D 437 -0.75 1489

Radico Khait-A/D 361.55 -1.3 308851

Rallis India-A/D 249.65 3.45 42570

Rallis India-A/D 249.65 3.45 42570

Reliance Indus/D 541 13.85 219234

Ruchi Soya-B/D 17.15 0.05 115217

Saur.Cem-X/D 91.5 -0.6 110662

Sterling Tool-/D 386.05 -18.5 1818

Tanfac Indu-Xt/D 116.65 1.15 8834

Tanfac Indu-Xt/D 116.65 1.15 8834

Thirumalai-B/D 2001.65 -45.9 14312

Til Ltd.-B/D 604.8 -7.1 2148

Timexgroup-T/D 62.45 -3.5 741237

Tinplate-B/D 255.15 -10.15 487472

Ucal Fuel-B/D 281.2 -12.1 33755

Ucal Fuel-B/D 281.2 -12.1 33755

Ultramarine-X/D 350.45 -10.35 13636

Unitech P -B/D 8.45 -0.26 5151110

Univcable-B/D 159.5 1.5 5071

3I Group/D 933.2 -1.8 293033

Assoc.Br.Foods/D 2782 0 153948

Barclays/D 200.65 -1.1 7455688

Bp/D 506.9 -1 6410933

Brit Am Tobacc/D 4859.5 28 680382

Bt Group/D 256.1 -1.4 5493009

Centrica/D 132.15 -0.2 9229089

Gkn/D 427.8 -0.5 1998192

Hsbc Holdings/D 759 -1.6 3883194

Kingfisher/D 347.8 -3.2 1852635

Land Secs./D 997.3 2.1 617741

Legal & Genera/D 271.4 -1.1 2566815

Lloyds Bnk Grp/D 70 -0.52 36598040

Marks & Sp./D 302.4 -2.7 1584643

Next/D 5116 -10 152957

Pearson/D 693.2 4.2 321010

Prudential/D 1913.5 4.5 709254

Rank Group/D 229 5.5 15471

Rentokil Initi/D 295 1.1 1805644

Rolls Royce Pl/D 868.6 9.2 401841

Rsa Insrance G/D 620.8 -0.8 370565

Sainsbury(J)/D 256 -1 1280775

Schroders/D 3722 4 82160

Severn Trent/D 1965.5 4 243094

Smith&Nephew/D 1280.5 -0.5 692065

Smiths Group/D 1602 0 245609

Standrd Chart /D 819.5 5.4 1083156

Tate & Lyle/D 645 -1.4 260728

Tesco/D 209.1 -0.3 3893960

Unilever/D 4020.5 39 680627

United Util Gr/D 743.8 8.4 643305

Vodafone Group/D 224.7 0.3 10465017

Whitbread/D 3903 2 97432

COMPANY CLOSE NET VOLUME NAME CHG TRADED

COMPANY CLOSE NET VOLUME NAME CHG TRADED

COMPANY CLOSE NET VOLUME NAME CHG TRADED

COMPANY CLOSE NET VOLUME NAME CHG TRADED

COMPANY CLOSE NET VOLUME NAME CHG TRADED

LONDON

Catherine Wakhu knows the value of a lighted room to a child’s education - and also the expense.

The resident of Mayoni, a village in Western Kenya’s Kakamega County, has seven school-age children. Without money to pay for a connection to the electric grid, she used to spend 1,200 shillings ($12) a month instead on kerosene, half of it to fuel a lantern so that her children could do their homework in the evenings.

But for the past year Wakhu has been the owner of two solar-powered lanterns, which enable her children to study and save her fuel money.

New Light Africa, the company that makes the lanterns, accepts payments on instalment over a period of six months, making the cost of 3,000 Kenyan shillings ($29) per lantern more affordable to people like Wakhu, who might otherwise struggle to acquire the technology.

The business is one of a number of enterprises across sub-Saharan Africa that are developing ideas for low-cost, high-quality and affordable clean energy products and services, from lighting to irrigation.

Some have received funding from the Renewable Energy and Adaptation to Climate Technologies (REACT) programme, part of the Africa Enterprise Challenge Fund, backed by European and other donor governments.

The clean energy REACT programme provides up to half the needed funding to private companies trying to develop business models, services and products in renewable energy and energy efficiency that will improve the lives of the rural poor.

Under the programme, up to 900,000 rural households across the region can now light their homes with solar

lanterns, press their clothes with solar-powered irons or watch solar-powered televisions, said Victor Ndiege, who manages the REACT-supported portfolio of businesses.

Village barbers also can earn a living shaving people using solar-powered shavers, and farmers can irrigate their crops with solar pumps, he said.

In Miguye, a village north of the Kenyan city of Kisumu, Oliver Bill, a 24-year-old university graduate, irrigates tomatoes on his 1.3-acre piece of land using a portable solar-powered water pump acquired with a loan from Future Pump, another company that is part of the REACT scheme. “I decided to take the risk because the repayment scheme sounded fair enough,” said Bill. He said he expects to have repaid the debt for the pump by March. Malayo Abuti, the assistant administrative chief for Ebuhala sub-location in Kakamega County, said business-oriented funding for clean energy projects is an improvement on handouts and is helping more young people in off-grid villages start their own enterprises to earn an income.

“This is a good culture because paying back the loan gives one a sense of ownership, self esteem and it makes them more responsible than receiving free tokens from organisations,” he said.

From solar irons to shavers, off-grid power push aims to light up

H&M’s store closure plan raises doubts on sales revival

ISAIAH ESIPISUREUTERS

ANNA MOLIN

BLOOMBERG

INVESTORS gave a thumbs-down to Hennes & Mauritz AB’s (H&M) turnaround plan, which includes the biggest store-closure

programme in at least a decade and the creation of a new format to supplement the Swedish clothing company’s stumbling main chain.

The company plans to shut 170 stores this year, even as it adds a new format called Afound to sell marked-down merchandise. The retailer said it would invest more in online sales and digital inventory-tracking technology, while adding stores in markets that are still growing.

The shares fell as much as 9.1 percent to a nine-year low yesterday in Stockholm. They have lost more than a quarter of their value in the past

three months. The slump brings H&M’s market value to 235 billion kronor ($29.9bn), equivalent to about a quarter of what Zara owner Inditex SA is worth.

“There is little in the statement to suggest that H&M can reignite its top line anytime soon,” wrote Richard Chamberlain, an analyst at RBC

Capital Markets. The world’s No 2 fashion chain by

sales has recently hit a number of roadblocks, reporting the biggest drop in quarterly sales on record. As online shopping has soared, fewer people are visiting H&M’s vast network of physical stores. The company has struggled to cut inventory, which ended the year higher than planned, and H&M said it will increase markdowns by as much as 2 percent in the first quarter to clear that out.

H&M ended the year with net debt for the first time in more than two decades, according to Geoff Ruddell, an analyst at Morgan Stanley, who called H&M’s full-year results “very poor.”

Operating profit fell 14 percent to 20.6 billion kronor in the 12 months through November, the biggest drop in six years.

The sales woes have forced Chief Executive Officer Karl-Johan Persson to retract a target of 10 percent to 15 percent annual sales growth for this year after setting that long-term target 12 months ago. The goal still stands for the future.

Some investors have sold shares amid fears the company is being too slow in responding to the industry’s digital shift. Didner & Gerge Fonder AB, one of H&M’s top shareholders, has called for a management shakeup. At a news conference Wednesday, Persson said he believes he has the board’s confidence as CEO and declined to comment further on calls for new management.

The company plans 390 new stores. About a quarter of the new shops will be formats other than the flagship H&M, such as COS, Monki and

Afound. The latter, the company’s ninth format overall, will consist of stores and websites that offer deals on the company’s own goods as well as merchandise from third parties.

The first Afound store will be in Stockholm, and the site will go online in Stockholm this year. H&M is building a format where it can funnel off excess inventory and is entering part of the market that discount retailers such as Primark and supermarkets have proven can be successful. Afound is a shift in strategy following the last new format, Arket, which sells higher-priced general merchandise, including houseware, purses and coffee.

Still, there’s a risk the new chain may cannibalize H&M’s existing business, according to Michelle Wilson, an analyst at Berenberg.

The Stockholm-based company’s image was also tarnished by accusations of racism after an advertisement featuring a black child wearing a hoodie with the text “coolest monkey in the jungle” sparked a social-media storm and protests in South Africa earlier this month. H&M has apologised for the ad.

Despite speculation among some analysts that H&M would be forced to cut its dividend for the first time since it was listed in 1974, the company kept its payout for 2017 unchanged at 9.75 kronor a share.

The company plans to offer shareholders the option to reinvest in new H&M shares instead of receiving the dividend in cash, which analysts said would dilute the stock. Members of the Persson family, collectively H&M’s biggest shareholders, plan to follow that option.

MARK Carney said he can fully focus on tackling inflation as the drag from Brexit

on investment and the economy starts to recede.

“As slack in the economy has been taken out, we’ve moved into a more conventional area for monetary policy where the focus is increasingly on returning inflation sustainably to target over an appropriate horizon,” the Bank of England (BoE) governor said on Tuesday.

The BoE will announce its next policy decision on February 8 alongside new economic predictions. Strong employment figures alongside better-than-forecast growth data, set against a strong global backdrop, have increased the chance of a summer

interest-rate hike. While November was once seen as the most likely month, bets on a hike in August -- or even as soon as May -- have risen in recent weeks.

“Carney is right to point out that the UK is benefiting from this pickup in global demand and the spillover is the big question mark for the inflation forecast,” said Simon French, chief economist at Panmure Gordon. “Investors should look at next Thursday for what I think will be quite a hawkish tone from the bank, guiding markets toward expecting a hike in the middle of the year, potentially at the May meeting.”

The shift to concentrate more on prices was apparent when officials raised the bank’s benchmark for the first time in more than a decade in November, and said they were likely to tighten policy further in the

coming years. Inflation currently stands at 3 percent, a full percentage point above the BoE’s target. The bank’s measure of the market’s expectations now shows about three quarter-point rate increases priced in over the next three years.

While the pound’s depreciation since the Brexit vote is still working its way through the inflation data, spare capacity in the economy is also getting used up. The BoE has both cut and raised rates since the UK’s 2016 vote to leave the EU in an attempt to balance accelerating price gains -- boosted by both the pound’s fall and weak productivity growth -- with a cooling economy.

Carney also defended the BoE’s forecasts made before Brexit, saying they correctly showed the economy would suffer. He’s previously been accused of being too gloomy.

“What we said prior to the referendum is that we thought the exchange rate would fall, perhaps sharply, inflation would go up, and growth would slow,” the BOE governor said. “After the referendum, the pound fell sharply, inflation went up, and growth slowed.”

Growth in business investment is likely 4 percentage points lower than it would’ve been had the U.K. voted to stay in the bloc and real household incomes have gone down by about 3.5 percent since the referendum, he said.

Carney expects a pickup in investment in 2019, in part because of stronger global growth and demand. “There are some headwinds to this economy that we all want to see cleared,” he said, referring to Brexit uncertainty. Norman Lamont, one of the committee members and a former Chancellor of the

Exchequer, asked if the BoE had a bias against Brexit, which Carney denied. Government forecasts on the impact of Brexit were leaked this week, reigniting the debate over subjectivity in projections. The analysis modeled three scenarios, from no trade deal with the EU to membership of the European Economic Area, and showed that all would hurt growth.

Asked if the bank has carried out a similar long-term exercise, Carney said that policy makers usually look at only a three-year horizon. In terms of financial stability, officials assess a disorderly Brexit, which isn’t a likely scenario but one the central bank can plan for.

“When the negotiations mature to a point where we know where we’re headed and when we get there, then we will have to do that sort of analysis and adjust the forecasts accordingly,” he said.

Brexit battle is switching to tackling inflation: BoE GovernorJILL WARD

BLOOMBERG

New Light Africa, the company that makes the lanterns, accepts payments on instalment over a period of six months, making the cost of 3,000 Kenyan shillings ($29) per lantern more affordable to people like Wakhu, who might otherwise struggle to acquire the technology.

The company plans to shut 170 stores this year, even as it adds a new format called Afound to sell marked-down merchandise. The retailer said it would invest more in online sales and digital inventory-tracking technology,

The BoE will announce its next policy decision on February 8 alongside new economic predictions.

27THURSDAY 1 FEBRUARY 2018 BUSINESS

A file photo of H&M Store in Festival Walk, Hong Kong.

28 THURSDAY 1 FEBRUARY 2018

INsightback to BUSINESS

CAPITALCOMMENT

The US government has enough cash to pay its bills through

February 28 without hitting the debt limit.

Steven Mnuchin, US Treasury Secretary.

NAME IN THE MARKET: US EXPORT PARTNERS

European funds have seen more than $22bn of equity inflows so far in January, after cornering a third of all flows last year across major regions.

Fintech startups parade in ParisBLOOMBERG

PARIS: The fintech dating game is on in Paris. Entrepreneurs in Europe’s financial-technology sector are pushing low-cost payments solutions to steal market share from banks, hoping the challenge they pose will spur the lenders to buy them or seek partnerships with them.

Many startups are eyeing deals or potential backing as they converge on Paris this week to meet with the top executives of French finance, from BNP Paribas SA’s Jean-Laurent Bon-nafe to Societe Generale SA’s Frederic Oudea, at the city’s annual Fintech Forum. How fin-techs defy incumbents is a prime theme of discussion there, with payments an area of focus, as banking alternatives from Ali-pay to M-Pesa already dominate in China and Africa.

“Banks will continue to acquire smaller and more nim-ble companies to add value to their products,” said Jacob de Geer, co-founder of Swedish payments company iZet-tle. “They need to innovate to keep customers, and they’ll con-tinue going to fintech for that

kind of innovation.” Fintech solutions have

become a competitive tool for banks as online consumption and transactions have soared. Global investment in fintech was $8.2 billion in the first nine months of last year, according to a KPMG report. At the Paris gathering -- on Tuesday and Wednesday -- about 140 firms from more than 30 countries put their ideas on display, present-ing everything from robo-advisers to artificial intel-l igence-dr iven weal th management.

European companies are earmarking increasing funds for early-stage fintech projects, either through direct acquisi-tions or through venture funds. Corporate venture-capitalists poured more than $600m into

fintechs in Europe in the first nine months of 2017, the high-est level on record, data by KPMG showed.

IZettle, which has posi-tioned itself as a cheaper alternative for smaller busi-nesses that need to process card payments, is preparing for an initial public offering this year but doesn’t exclude looking for private funding instead, De Geer said. After it expanded out of Europe to Brazil and Mexico through a deal with Banco Santander SA, iZettle is open to more partnerships, its co-founder said.

“The financial services of tomorrow will revolve entirely around partnerships,” Societe Generale Deputy CEO Severin Cabannes told reporters Friday, two months after the bank announced it will set up a fund of as much as €150m ($186m) to accelerate innovation. “We’re going toward an open world” for financial services, based on part-nerships and team-ups, he said.

At the conference in Paris were Germany’s mobile bank N26, French SME lending-plat-form Lendix and GiniMachine, a Belarus startup that provides

artificial intelligence to assess credit risk.

Among fintechs seeking partners is Famoco, which makes Android-based software and devices for securing elec-tronic transactions. It’s looking for deals to help distribute its products globally, and would be open to discussing a stake sale, its co-founder Lionel Bara-ban said. He’s not ruling out selling the company, though that’s not currently a priority.

Famoco’s counts among its customers Orange SA, the French phone company that launched into banking and has a payments solution rival to M-Pesa in Africa. Other clients include Alipay, an affiliate of Chinese billionaire entrepreneur Jack Ma’s Alibaba Group Hold-ing Ltd. that’s pushing forward with plans to expand in Europe.

“We’re stealing market share from the well-established players, because we’re coming in with a cheaper and more flex-ible payments solution,” Baraban said. “We truly believe there’s a possibility to create a new glo-bal leader in transactions. Still, we need partners of big scale to help us distribute.”

Euro consolidates gains after inflation quickensLONDON / REUTERS

The euro climbed half a percent on Wednesday and was on track for its biggest monthly rise in nearly two years as firm euro zone inflation data for Jan-

uary kept expectations alive for a swift withdrawal of the central bank’s stimulus policies.

Though the European Central Bank last week kept policy unchanged and fended off discussions of winding down its massive stimulus programme any time soon, that hasn’t prevented some investors from expecting an interest rate hike in the first quarter of 2019.

Underlying inflation, excluding food and energy, - a key measure studied to gauge price pressures in the 19-bloc zone - actually accelerated to 1.2 percent in Jan-uary from 1.1 percent a month earlier but broader price gauges slowed.

“From all accounts, Europe continues to do well, as (is) evident from a strong structural balance, and that has kept investors happy to buy eurozone assets,” said Robin Winkler, an FX strate-gist at Deutsche Bank in London.

European funds have seen more than $22bn of equity inflows so far in Janu-ary, after cornering a third of all flows last year across major regions, according to flows data indicating the underlying optimism about the outlook.

Tuesday’s preliminary data showed the euro zone economy expanded at its fastest rate in a decade in 2017, with sentiment remain-ing high at the start of 2018 despite a slight dip from a 17-year peak.

Despite the near 4 percent rally in the euro so far this month, the currency remains broadly undervalued on a trade-weighted basis on long-term averages.

On Wednesday, the single currency climbed half a percent to a high of $1.24630 after the inflation data.

Meanwwhile, the dollar fell by a quarter of a per-cent, putting it on track for its biggest monthly drop in nearly two years as US President Donald Trump’s first State of the Union address failed to offer any comfort to ailing dollar bulls.

Against a basket of rivals, the greenback was down 0.25 percent, taking its losses to 3.5 percent in January, its biggest monthly drop since March 2016.

Trump called on the US Congress to pass legislation to ensure at least $1.5 trillion in new infrastructure spending and urged lawmakers to work toward biparti-san compromises, but he pushed a hard line on immigration.

The new round of weakness comes after a period of consolidation earlier this week as financial markets expected the US Federal Reserve to take a more confi-dent stance about the outlook of the economy but keep policy unchanged.

US Fed rate decision due as Yellen’s tenure concludesAFP

WASHINGTON: The Federal Reserve concludes its first meet-ing of 2018 on Wednesday, with markets convinced the central bank will leave the benchmark interest rate untouched but nonetheless watching for signals of increases ahead.

The two-day meeting is the last of Janet Yellen’s tenure as Fed chair. The long-serving cen-tral banker’s term ends Saturday after she was passed over for a second term by President Don-ald Trump. Policymakers expect to raise interest rates three times this year, with the danger of inflation on the horizon after years in which it ran well below the Fed’s two percent target.

But investors expect the first

move will come at the Fed’s next meeting in March.

“Any change in policy would be astonishing, and we’d be surprised to see any mean-ingful shift in the language of the statement describing the state of the economy and the out-look,” Ian Shepherdson of Pantheon Macroeconomics said Tuesday in a client note.

The key core inflation measure, which strips out noisy price fluctuations, has run below the Fed’s two percent target for more than five years. Prices have refused to budge despite the steadfast economic recov-ery of the last decade, with steady job creation and record low unemployment.

But economists say 2018 may be the year this changes: major world economies are

growing simultaneous, energy prices are recovering, the dollar is weakening, Congress has slashed taxes, labor is in short supply, asset prices are at dizzy-ing heights and President Donald Trump is threatening trade moves that could drive up con-sumer prices. And Shepherdson noted that business investment was up 7.9% in the final quarter of 2017, with the energy indus-try reversing recent declines in spending on equipment. “Invest-ment can no longer be described as ‘soft,’” he wrote.

Yellen leaves the Federal Reserve after having oversee-ing a smooth recovery in the world’s largest economy and the cautious unwinding of post-cri-sis stimulus program that critics had feared could unsettle mar-kets and fuel inflation.

Many startups are eyeing deals or potential backing as they converge on Paris this week to meet with the top executives of French finance.