BUSINESSBUSINESSMonday 4 December 2017

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TIM’s board to discuss network

options this week

Qatar property market poised for rapid growth

Dow & Brent before going to press

Qatar Riyal stabilising after QCB pledge on dollarDoha Reuters

Qatar Riyal is stabilising in offshore trade, recovering from sev-eral weeks of increasing volatility,

after the central bank pledged to ensure liquidity in the foreign exchange market, commercial bankers said yesterday.

Until late November, the riyal swung widely between its peg of 3.64 to the US dollar, widely used onshore, and much weaker off-shore rates. On November 21, it traded as low as 3.8950 on the

Reuters conversational dealing platform.

After the diplomatic rift, Qatar’s central bank and big state-owned Qatari banks became reluctant to supply dol-lars to the market when they believed the supply might be used for speculation against the riyal.

On November 22, equity index compiler MSCI cited poor currency market liquidity when it said it might shift to using off-shore exchange rates to value Qatar’s equities market - a move that could potentially lead to cuts in the weighting of Qatari stocks

in MSCI’s emerging market index.

In an effort to avoid this, the central bank responded by say-ing it was committed to providing all the currency requirements of investors, including local and foreign indi-viduals and institutions, at onshore exchange rates.

Since then, the riyal has gradually become less volatile, commercial bankers said. Most recently, it has been trading on the Reuters conversational deal-ing platform between 3.6404 and and 3.6950, a much smaller range than previously.

Some commercial bankers doing business in Qatar said the central bank appeared to have increased its supplies of dollars to the market after making its pledge. Others said it was not-clear that supplies had actually increased, but agreed the pledge was having an impact.

The bankers also said that if the central bank did not ulti-mately follow through on its pledge to improve liquidity, the offshore market could soon resume testing the riyal’s lows.

MSCI said it would take feed-back from the investment community on the proposed

currency shift until December 1, and would announce its final decision by December 5.

Qatar’s stock market dropped last week because of worries about the MSCI decision but rebounded modestly yesterday.

A stabilising currency helped Qatar Stock Exchange (QSE) benchmark index rise 0.6 per-cent with drilling rig provider Gulf International Services jump-ing 4.7 percent.

Real estate firm Ezdan Hold-ing continued a rebound that began in late November, surging 6.3 percent.

Trading higher

Recently, Qatar Riyal has been trading on the Reuters conversational dealing platform between 3.6404 and and 3.6950, a much smaller range than previously.

QCB is committed to providing all the currency needs of investors

7,300.49-26.18 PTS

0.36%

24,231.59- 40.76 PTS

0.17%

FTSE100 DOW

$58.29 $58.29 +0.89+0.89

BRENT

7,756.55+42.29 PTS

0.55 %QE

22 MONDAY 4 DECEMBER 2017BUSINESS

Sundar Pichai (left), Google Inc’s CEO; and Lei Jun, Xiaomi’s founder and CEO; attend a session of the fourth World Internet Conference in Wuzhen, Zhejiang province, China, yesterday → See also page 24

World Internet Conference

Qatar property market poised for rapid growthSatish KanadyThe Peninsula

Supported by a series of policy-driven decisions, Qatar’s real estate sec-tor is expected to stage a strong turnaround in

2018. Proposed law on foreign ownership, tax incentives, a bal-anced budget announcement for the coming fiscal, increased gov-ernment spending and mega deals in pipelines…are some of the growth triggers that would help recover the market in 2018, before hitting an 8 percent growth in 2019.

Leading property developer SAK Holding Group said yester-day the government’s focus on the completion of the major development projects; especially infrastructure projects in the health sector, education and transportation and projects related to the World Cup 2022, will atttract continued flow of real estate liquidity. This will support the ability of real estate sector to respond to the require-ments of the country’s sustainable development agenda.

The soon-to-be expected new law on foreign ownership will revive the real estate mar-ket in 2018. The preparation of

the draft law on the ownership of real estate for non-Qataris, which is due to be implemented next year is an initiative aimed at creating new opportunities for the real estate sector. The pro-posed law is expected to provide an attractive environment for real estate investment and will help inject huge liquidity in the property market. This will increase the appetite of both res-ident and foreign investors looking for real estate opportu-nities affected by growing confidence in legislation protect-ing their investments and stability, SAK Holding Group’s ‘Market Watch’ report noted.

“The talk about the new law is based on what was reported by His Excellency the Prime Min-ister and Minister of Interior in a television interview that H H the

Emir ordered the preparation of a draft law to own the property for non-Qataris and that it will be implemented during the com-ing year,” the report said. Qatar’s

property market in general, remains a safe haven for a large segment of investors and savers.

This will lead to a recovery

in real estate transactions, mainly residential properties, which contributed in the contin-ued pumping of liquidity into real estate investment over the years.

The report noted that the country’s real estate sector has weathered the blockade storm. The market is giving enough sig-nals that it has overcome the siege impact. Market participants have strong faith in Qatari econ-omy, supported by balanced government spending on infra-structure as well as other major projects.

Qatar’s tax incentive is yet another attraction for investors in the real estate. Qatar provides tax exemptions from interest and banking revenues that do not engage in taxable activity whether resident or non-resi-dent. As well as the interest and proceeds of general treasury bills, development bonds, bonds of public institutions and capital gains arising from real estate actions by natural persons, pro-vided that the properties being disposed of are not assets of a taxable activity. Along with div-idends and other income arising from equities, Qatar ranks first as the world’s best corporate destination in terms of taxes and levies, the report said.

Mohammad Shoeb The Peninsula

Qatar’s real estate sector witnessed a record jump in terms of the value of transactions during the third week of November. The

combined value of real estate deals reached QR472.3m during the week (November 19 to 23), witnessing a remarkable growth of over 200 per-cent compared to QR157m registered during the previous week, according to Ezdan Holding Group’s latest weekly report.

The significant jump in the weekly transac-tions value was attributed to the execution of an exceptional deal worth QR114m for the sale of a land plot (16,645 square metres) in Gharafa area at the rate of QR6,859 per square metres.

The Ezdan report said that during the week 74 transactions were executed, up 40 percent compared to 53 deals registered in the previous week. The deals for prefabricated buildings dom-inated the week’s transactions with 45 transactions accounting for 57.4 percent of the total deals. The combined value of total deals for prefabricated buildings reached at QR271.1m dur-ing the week. While the transactions for land

plots occupied 42.6 percent of the total transac-tions with a value of QR201.2m from the implementation of 29 transactions, Ezdan report said citing official data from the Department of Real Estate Registration at the Ministry of Justice.

Al Rayyan Municipality topped in terms of the value of real estate transactions at QR194.2m from 18 transactions, acquiring 41.1 percent of the total deals during the week.

The Doha Municipality came second with a value of QR159.2m, a record high of 312 percent as a result of the execution of 18 transactions. Doha accounted for 33.7 percent of the total transactions during the week.

The value of the highest deal in the Doha Municipality was QR26m for the sale of a resi-dential building in Baraha Juffairi locality with an area of ,1020 square metres, coming out to be QR25,500 per square metre. It also witnessed the sale of a house in the new authority (4,055 square metres at a price of QR25m.

The land accounted for 11.4 percent of Doha’s dealings worth QR18.1m, while ready-to-move properties accounted for 88.6 percent of total transactions, with a value of QR141.1m

Major recovery in third week of NovSAK Holding Group

The soon-to-be expected new law on foreign ownership will revive the real estate market in 2018.

The government’s focus on the completion of the major development projects will atttract the continued flow of real estate liquidity.

Ooredoo to hold extraordinary AGM on December 20The Peninsula

Ooredoo will hold its extraordinary general assembly meeting at

Ooredoo main headquarters in the West Bay on Wednesday, December 20, 2017. Agenda for the extraordinary meeting includes approving the modifi-cation of article (20) of the company’s articles of associa-tion, Ooredoo said in a regulatory filing to Qatar Stock Exchange (QSE), yesterday.

According to the proposed article, the company shall be managed by a board of directors consisting of ten members. The Qatar Holding Co. shall appoint five members and one of them shall be the board chairman. None of them will be dismissed until there is a decision from Qatar Holding Co. The general

assembly shall appoint five members by secret voting, pro-vided that Qatar Holding Co. shall not participate in the vot-ing process.

The voting shall be as per the provisions of the commercial companies law and rules and instructions issued by Qatar Financial Markets Authority, the elected board member should be a shareholder and owns not less than 5000 (five thousand) shares deposited in an author-ised local bank within sixty days of the member’s membership commencement date, deposi-tion of the shares should continue without the shares being liable for trading or mort-gage or seizure until the end of the member’s tenure, and his approval of the budget of the last fiscal year in his tenure, the shares mentioned in the

previous paragraph are assigned as a collateral for the rights of the company, shareholders, creditors, and others parties, in relation to the board members responsibility, in case the mem-ber did not provide the collateral as outlined his membership to the board shall be invalidated.

The agenda also include approval of amending the com-pany’s articles of association to comply with the commercial companies’ law number (11) for 2015, and authorize the Chair-man of the board the power to carry out that.

A shareholder who cannot attend the extraordinary general assembly meeting in person may appoint a proxy to represent him.

Only shareholders, whose names have been registered in the company’s shareholder

register with the Exchanges after closing of business on Wednes-day the 20th of December 2017, are eligible to attend Ooredoo’s extraordinary general assembly meeting. Shareholders should bring with them relevant docu-ments proving their ownership of the shares they claim to hold.

The announcement posted in local newspapers, on the Qatar Stock Exchange website, and the Company’s website, will be official to all shareholders, as no invitations will be sent through the post, according to stipulations of article (121) of Commercial Companies Law. The meeting will be conducted in Arabic.

If there is no quorum on December 20, the meeting will be held on Sunday, 24 Decem-ber 2017, at the same time and place.

QNB to sponsor ‘Made in Qatar 2017’ exhibitionThe Peninsula

Qatar Chamber has announced that the Qatar National Bank (QNB

Group) is supporting the ‘Made in Qatar 2017’ exhibition as Official Sponsor.

In order to promote Qatari products locally, Qatar Cham-ber is organising the expo, in cooperation with the Ministry of Energy and Industry, on December 14 to 17 at the Doha Exhibition and Convention Center (DECC).

The expo will be held under the patronage of the Emir HH Sheikh Tamim bin Hamad Al Thani.

Qatar Chamber Director-General Saleh bin Hamad Al Sharqi and QNB’s Assistant General Manager for Commu-nication, Salim Anzan Al Nuaimi signed the sponsorship agree-ment at the Chamber’s headquarters, yesterday.

Saleh Al Sharqi expressed his gratitude and honour to QNB Group for sponsoring the exhibition, saying: “ We highly appreciate the QNB’s keenness on enhancing and boosting the national industry which signif-icantly reflects its strenuous efforts for developing the pri-vate sector and providing financial facilitations to busi-nessmen and entrepreneurs,

particularly in industry sector of its all various kinds,”

This year edition will run in parallel with the National Day of the State, he said, expressing his hope that the expo would contribute to strengthening communication ties among Qatari leading businessmen and manufacturers and developing the Qatari industrial sector, especially in the SMEs sector.

On his part, Salim Al Nuaimi expressed his pleasure that the QNB is an official sponsor to the exhibition, affirming the bank’s great interest in supporting the events that promote national products and contribute to developing economic growth in the country.

In a statement, Al Nuaimi said that the QNB’s sponsorship to the exhibition stemmed out from its firm commitment towards fostering local indus-try and promoting the locally-manufactured products in the Qatari market in pursuit to achieving the self-sufficiency and reducing dependence on imported items, including the foodstuffs products.

Al Nuaimi underlined the bank’s continuous commitment towards supporting such events and exhibitions that contribute to enhancing local production and benefiting local economy and industry.

Saleh bin Hamad Al Sharqi (right), Director-General, Qatar Chamber; and Salim Anzan Al Nuaimi, QNB’s Assistant General Manager for Communication, shake hands after signing the sponsorship agreement at Qatar Chamber headquarters, yesterday.

Adidas expects big boost from World CupBerlin Reuters

Adidas expects a big increase in sales of soc-cer jerseys from the 2018

World Cup in Russia helped by its sponsorship of three of the top teams, the German sports-wear maker’s chief executive was quoted as saying on Saturday.

“In football, we are the clear

market leader worldwide and are sponsoring 11 teams at the World Cup next year,” Kasper Rorsted said. “Overall, I expect a big increase in Adidas jersey sales in 2018 because of the World Cup. I hope that our teams go as far as possible. After all, we are kitting out three of the favourites with Germany, Spain and Argentina.”

Adidas is the official spon-sor of the World Cup and has

long been the top supplier of soccer shirts, shoes and balls.

But at the 2014 World Cup in Brazil, arch rival Nike spon-sored more teams for the first time. Adidas has since enjoyed a big comeback, taking market share from Nike in the United States, and revamping its soc-cer business. It is back in the lead with the most teams spon-sored at the World Cup including hosts Russia.

White House open to small changes on corporate taxWashington Reuters

The White House is will-ing to consider a small increase on the corporate

tax rate if it is needed to final-ize the bill in the US Congress, White House budget chief Mick Mulvaney said yesterday.

Mulvaney made his com-ments after President Donald Trump suggested on Saturday that the corporate tax rate could end up at 22 percent once the Senate and House of Rep-resentatives reconcile or “conference” their respective versions of the legislation, even though both bills currently stand at 20 percent.

“My understanding is that the Senate (bill) has a 20 per-cent rate now. The House has a 20 percent rate now. We’re happy with both of those num-bers,” Mulvaney said in an interview with CBS’ “Face the Nation.”“If something small happens in conference that gets us across the finish line, we’ll look at it on a case-by-case basis. But I don’t think you’ll see any significant change in our position on the corporate taxes,” Mulvaney said.

23MONDAY 4 DECEMBER 2017 BUSINESS

Yevgeny Butman (left), head of Ideas4Retail; Marina Zhigalova-Ozkan (centre), Disney Russia CEO, and Sergey Kalinin, head of Hals-Development cut the red ribbon on the opening of the first Disney store in Moscow, Russia, yesterday.

Mannai Corp EGM approves changes in AoAMohammad Shoeb The Peninsula

Shareholders of Mannai Corporation yesterday gave their approval for the amendment in the company’s Articles of

Association (AoA) in compliance with the new regulatory provi-sions with regard to Corporate Governance.

The decision is in line with the new ‘Governance Code for Companies & Legal Entities Listed on the Main Market’ recently passed by Qatar Finan-cial Markets Authority (QFMA), the capital market regulator.

The decision was taken at the ‘Extraordinary General Assem-bly Meeting’ (EGM), which was chaired by Sheikh Suhaim bin Abdulla Al Thani, Vice-Chairman of the Board of Directors of Man-nai Corporation.

Sheikh Suhaim, reading out the statement of the company’s

Chairman, Shiekh Hamad bin Abdulla bin Khalifa Al Thani, before the Assembly noted that “the Board of Directors has always appreciated the impor-tance of the principles of Corporate Governance and

recognised the importance of their application, even before issuance of the Code”, adding that “accommodating these pro-visions from the Corporate Governance Code for Companies and Legal Entities Listed in the Main Market in our Articles of Association will contribute to the advancement of the Corporate Governance culture in the com-pany and will further enhance our corporate governance practices.”

“We are amending our Arti-cles of Association to reflect on the new Corporate Governance Code wherever our AoA did not

have certain provisions,” Alekh Grewal, Group Chief Executive Officer and Director, told The Peninsula on the sidelines of the EGM.

Asked about the company’s future plans and fourth quarter financials, especially the reve-nues and profits, he said that the company is performing well and moving ahead as per the strat-egy, and financial results are expected to be announced by the end of February 2018. But he did not provide any further details citing regulatory constraints.

The company recorded a group revenue of QR4.4bn for the

third quarter of 2017, up 26 per-cent from a year ago. The gross profit increased by 24 percent to QR1.0bn. During the year the company continued with its strategy of diversifying geo-graphically by acquiring controlling interests in GFI Infor-matique a French publicly listed major IT company operating in France and 16 other countries in Europe, Africa and Latin Amer-ica. The increase in the gross profit is mainly due to the acqui-sition of controlling interests in GFI Informatique.

With this acquisition the company now employs over

20,000 employees of 42 differ-ent nationalities in 20 countries. The pre-tax profits showed a decline of 15 percent (QR294m) compared to the previous year, partly due to increase in finance cost incurred for funding the acquisition and the general mar-ket condition in the region.

However, the company is optimistic of improving the per-formance in the long term on the back of overseas investments made in the recent past and other opportunities in Qatar as the country embarks on major infra-structure projects for hosting FIFA World Cup in 2022.

Sheikh Suhaim bin Abdullah Al Thani, Vice-Chairman of Mannai Corporation (fourth left) with other board members and officials during the Extraordinary General Assembly Meeting (EGM) at InterContinental Hotel-Doha, yesterday.Pic: Abdul Basit/The Peninsula

Group revenue

The company is performing well and moving ahead as per the strategy, and financial results are expected to be announced by the end of February 2018.

The company recorded a group revenue of QR4.4bn for the third quarter of 2017, up 26% from a year ago. The gross profit increased by 24% to QR1.0bn.

TIM’s board to discuss network options this weekMilanReuters

The board of Telecom Ita-lia (TIM) will this week discuss options for its

fixed-line network, including possibly splitting it off, although no decision is expected to be made, a source close to the company said yesterday.

Italian politicians and rival firms have long called on the former monopoly to separate and upgrade its network, an asset some analysts have val-ued at up to ¤15bn ($18bn).

The pressure has intensified since French media group Viv-endi, TIM’s biggest shareholder with a 24 percent stake, began to exert greater influence, rais-ing concerns within the Italian government, which considers the network a strategic national asset.

The source said recently appointed CEO Amos Genish, a former Vivendi top executive, would give an outline of his 2018-2020 business plan to the board on December 5.

“As part of that presenta-tion the CEO will also present the various options for the future of the network, includ-ing a potential separation,” the source said, speaking on con-dition of anonymity because of

the sensitivity of the matter.“No decision will be taken

on Tuesday and the CEO will promise to come back with his recommendation for the net-work at a later stage.”

A second source close to the matter said Genish could be given a formal mandate by the board on Tuesday to study pos-sible developments for the network, including a separa-tion from the rest of the company.

Genish, became TIM’s boss in September, with a mission to fend off rising competition in Italy, turn around operations in Brazil and smooth strained relations with Rome.

He has held talks with Industry Minister Carlo Calenda which both sides described as positive. But TIM is keeping its options open and the centre-left government’s hand is weakened by the prospect of national elections due by May 2018 which polls say are likely to result in a hung parliament.

Genish, who will present his business plan early next year, said last month TIM wanted to keep control of its fixed net-work but didn’t need to own it in full, adding the company would make a decision “on our terms when we really believe it’s needed.”

UK cyber agency targets KasperskyWashingtonReuters

Britain’s main cyber secu-rity agency warned British government agencies to

avoid using anti-virus software from Russian companies, the latest in a series of moves tar-geting Moscow-based security software maker Kaspersky Lab.

In a letter to departmental permanent secretaries, the director of the UK National Cyber Security Centre, Ciaran

Martin, said Russian-made anti-virus software should not be used in systems containing information that would harm national security if it was accessed by the Russian government.

He said his agency is in talks with Kaspersky Lab to develop a system for reviewing its prod-ucts for use in Britain.

Kaspersky’s anti-virus soft-ware was banned from U.S. government networks earlier this year on concerns

the company has close ties to intelligence agencies in Moscow and that its software could be used to enable Russian spying.

“We are in discussions with Kaspersky Lab ... about whether we can develop a framework that we and others can inde-pendently verify,” Martin said in the letter, which was publicly released.

Kaspersky Lab said in a statement that it looked forward to working with the NCSC on the issue.

Trump says he’s ‘unbeatable’ in 2020 on tax cutWashingtonBloomberg

President Donald Trump, fresh off a victory in the Senate that puts him a step

closer to passing a tax-cut bill by year-end, declared himself “unbeatable” for re-election in 2020 -- and suggested a critical element of the Congressional tax plan is open to debate.

“Unless they have somebody that we don’t know about, right now we’re unbeatable,” Trump said Saturday at a fundraising breakfast in New York City.

The president spoke to Republican donors hours after

the Senate narrowly approved the most sweeping rewrite of the US tax code in three decades, slashing the corporate tax rate and providing temporary tax-rate cuts for most Americans.

Senate and House negotia-tors will get to work as soon as Monday to reconcile the meas-ure with the one passed by the House in November. The bills have some significant differ-ences, yet both versions agreed that the corporate tax rate will be set at 20 percent, versus the current 35 percent.

Earlier on Saturday, board-ing Marine One at the White House, Trump said of the

business tax rate, “it could be 22 [percent] when it comes out. We are going to see what ultimately comes out.” Accepting anything other than a 20-percent rate would be a shift in position for the administration.

At New York’s Cipriani res-taurant, Trump linked what he cast as his electoral invincibility with this year’s gains in the stock market as well as the tax plan.

“One of the reasons is what’s happening with the markets, what’s happening with business, what’s happening with jobs,” Trump told about 450 attendees at the Midtown restaurant, in the first of three fundraising events

for the day that were expected to raise about $6m.

Trump also said that the rise in many people’s 401k retire-ment balances with the stock market’s surge to record highs would make a good campaign line. He recounted an anecdote that occurred backstage, before Saturday’s event: “One great gentleman came up and he said, ‘Sir, I want to thank you.’ I said, ‘What did I do for you?’ He said, ‘My 401(k) is up 40 percent.’ And I never thought it! You know, I tell you, he gave me one of the great campaign lines. It’s called ‘How is your 401(k) doing?’”

Trump said, without

elaboration, that “new numbers just came out” backing up his assessment of the electoral land-scape. The comment appeared to relate to recent fundraising tal-lies for Republicans versus those for Democratic organisations.

The president’s third event of the day was a fundraiser at the Manhattan home of billionaire Blackstone Group LP Chief Exec-utive Officer Stephen Schwarzman, said two people familiar with the event who weren’t authorized to speak pub-licly. Peter Grauer, chairman of Bloomberg LP, is a non-execu-tive director at the Blackstone Group LP.

Europe set to award China with tariffrules revampBrussels Bloomberg

European industries from steel to solar are bracing for a new set of

tariff rules that may make it harder to fend off low-cost imports from China and other foreign countries.

European Union govern-ments are due on Monday to rubber-stamp the biggest revamp of the bloc’s method for calculating duties aimed at countering below-cost -- or “dumped” -- imports. The move is a response to long-s t a n d i n g C h i n e s e government demands for more favorable treatment while stopping short of say-ing those shipments are fairly priced.

The overhaul will end an EU presumption that Chinese exporters and those in nine other members of the World Trade Organization operate in non-market conditions. That approach, which has allowed for higher European anti-dumping duties, is being replaced by a more opaque procedure for determining whether imports unfairly u n d e r c u t d o m e s t i c producers.

“There’s going to be much more work for Euro-pean industries to make their dumping cases,’’ said Laurent Ruessmann, a partner and trade expert in the Brussels office of law firm Fieldfisher LLP. “There’s a lot of discre-tion for EU trade authorities in the new system. The ques-tion is how that discretion is used and what the political influence will be.’’

The EU carrot to China comes as both seek to claim a global leadership role in trade amid US President Donald Trump’s protection-ist stance, which has shaken the post-World War II com-mercial order.

Europe is offering polit-ical and economic rewards to Beijing by removing China from the European list of non-market-economy coun-t r i e s i n d u m p i n g investigations.

Disney Russia store

24 MONDAY 4 DECEMBER 2017BUSINESS

Joon Chief Executive Jean-Michel Mathieu (left) and Air France Chief Executive Franck Terner pose in front of an Airbus A320 wearing the colour of Joon, the new airline subsidiary of Air France, at Air France Industries maintenance services building in Roissy, on the eve of the company’s first commercial flights.

China blow up fears overdone for Nordea’s Emerging Markets chiefOslo Bloomberg

When investors get nerv-ous about the Chinese markets, it’s an

opportunity for some to snap up stocks in the country’s emerg-ing global powerhouses.

A lot of the worries about China and its financial system are “exaggerated”, according to Jorry Noeddekaer (pictured), the head of emerging markets at Nordea Asset Management in Copenhagen.

“Every two weeks or so somebody tells you that China is going to blow to pieces. It hasn’t happened so far,” Noed-dekaer said.

Volatility has increased in the Chinese stock markets in the past month and the CSI 300 Index has fallen more than 5 percent from a high in Novem-ber, the biggest decline since 2016, after the Chinese govern-ment signaled it was concerned about some high-flying stocks.

“All this nervousness and all these very skeptical people out t h e r e , c r e a t e a

great opportunity for being a stockpicker,” said Noeddekaer, who oversees $5bn. “You can buy very high quality compa-nies cheaply.”

Noeddekaer buys compa-nies in the service and consumption driven part of the economy while avoiding the commodity sector and the gov-ernment-owned banks.

Nordea Emerging Stars fund has returned on average 11 per-cent a year in the past five years. That’s better than 93 percent of its peers, according to data com-piled by Bloomberg. Its biggest

holdings are Samsung Electron-ics Co. Ltd, Tencent Holdings Ltd, Taiwan Semiconductor Manufacturing Company, Ltd. and Alibaba Group Holding Ltd.

Alibaba has “an exception-ally scalable business model” and the “monetisation potential of customer engagement still have a lot of room to grow,” according to Noeddekaer.

“They’re slowly starting to make a global expansion,” he said. “With their business model, services and the IT capabilities, they will become a true global player ten years from now.”

The Emerging Stars fund is overweight India, where Noed-dekaer is betting on the housing boom and growth in financial services by holding companies such as Housing Development Finance Corp.

“Being an emerging markets manager isn’t about the abso-lute level,” he said. “The journey is about how the economy and the companies in the economy improve. We’re chasing and hunting for these improvement cases. There’s a lot of improve-ment going on in India now.”

Liberian economy struggles as election crisis drags onMonrovia AFP

Businesses in Liberia’s dual-currency economy are feeling the pinch as cus-

tomers stay home and the exchange rate keeps climbing in the absence of a resolution to the country’s disputed presidential election.

“Nobody wants to buy, peo-ple are keeping their money,” said Ruth Wollie, one of many female market traders who make up an important voting bloc for Liberian politicians.

“For us to sell 1000 LD ($8) per day is very difficult,” she added at her stall in Monrovia.

Liberia has enjoyed 12 years of peace under President Ellen Johnson Sirleaf, but hopes for an economic revival after back-to-back civil wars between 1989 and 2003 were dashed by slumping

commodity prices hitting key exports of iron ore and rubber, and the impact of the 2014-16 Ebola crisis which left some 4,800 people dead.

Now an electoral crisis has compounded the problem, with conditions becoming intolerable in a nation hugely reliant on informal trading for income.

It began in late October, when Vice President Joseph Boakai and opposition leader Charles Brumskine finished sec-ond and third in the October 10 election, but alleged “massive fraud” afterwards.

The allegations however were rejected by the National Elections Commission (NEC), which found that the two parties failed to provide “indubitable evi-dence” as required by the constitution that the vote was tainted by fraud.

The parties then appealed to the Supreme Court, which is due to rule next week on whether to reject Boakai and Brumskine’s complaint and allow the runoff to go ahead, or call new elections.

The process has delayed the selection of a Sirleaf successor for nearly a month, as Boakai was due to face top-placing candidate

and former international foot-baller George Weah on November 7.

“We were expecting a run-off and they took themselves and carried themselves to court,” market trader Beatrice Harris said. “They were thinking that it was for our (own) good, but it was not for our good -- only for themselves.

“If they love us as Liberians, they will understand what it means to come to the market and can’t even find a meal for your child”. Harris added that politi-cians are making the people “suffer”.

Christopher Pewee, a shoe seller in Paynesville, said the sit-uation had “stagnated”. “Investors are holding back investments, and the demand for US dollars is high.

That’s why the rate has climbed from 110 to 130 Liberian

dollars to the US dollar,” he said, surrounded by brightly coloured flip-flops. “The election is on hold, the businesses are also on hold. We don’t know what is going on”.

Liberia has two legal curren-cies: the Liberian dollar and the US dollar.

The country also imports the vast majority of its food, and wholesale imports and taxes are payable in US dollars only.

“If you don’t have US dollars to buy, the price will be increased and the rate is 130 (Liberian dol-lars) now. We are just asking the government to at least speed up the process,” market trader Ruth Wollie complained.

Trader Annie Saah said “most people are afraid” that the situ-ation will devolve into violence. “So they’re keeping their money just in case of anything, to sus-tain their families,” she added.

Sirleaf has urged a speedy resolution to the dispute for the sake of the economy. “Our econ-omy is under stress due to the delay of the electoral process,” Sirleaf said on November 7. “We have to do all we can to save our democracy and allow a smooth transition”.

Liberian economist Ansu Sonii, who is also campaign man-ager for Weah’s Congress for Democratic Change (CDC) said investors tended to “play safe and hold on” in a nation with few safeguards on their money, and with the civil war and sanctions never far from memory. “

They want to know if that person is going to introduce a policy that will interfere with their investments or even undo” them, or even “whether that per-son will be sanctioned by the international community,” Sonii said.

Italy financial police visit Gucci’s offices in tax probe

Developers earned $17bn from China App Store: CookWuzhen Reuters

Apple Inc’s chief exec-utive Tim Cook (pictured) said developers using its platform in China

number 1.8 million and have earned a total 112 billion yuan ($16.93bn), representing roughly a quarter of total global App Store earnings.

Cook shared the data yes-terday during a speech at China’s top public cyber policy forum, organised by the Cyber-security Administration of China (CAC), which oversees internet r e g u l a t i o n i n c l u d i n g censorship.

Earlier this year, Apple said that developers had earned roughly $70bnn in total reve-nue through the store.

Apple is facing criticism from local users and rights groups for bowing to pressure from Beijing cyber regulators after it decided to remove hun-dreds of apps from its Chinese store this year, including mes-saging apps and virtual private network (VPN) services, which

help users subvert China’s Great Firewall.

Apple counts China as its third-largest region by sales but it has lost market share in recent years as high-end handsets from local rivals continue to gain traction. The firm is hoping to regain momentum following the release of its iPhone 8 and iPhone X models which shipped in November.

The US tech giant said ear-lier it had moved its Chinese cloud data onto the servers of a local partner in the Chinese province of Guizhou.

Cook has come to China sev-eral times this year, including

an October visit where he was among executives that met with President Xi Jinping, who also had prepared remarks read at the conferenceyesterday.

Cook’s attendance is con-spicuous at the conference, marking the first high-level executive to attend in the event’s four-year history.

Others included Google chief executive Sundar Pichai, who is also attending the con-ference for the first time.

Turnbull flags tax cuts before 2019 electionAUSTRALIAN Prime Minis-ter Malcolm Turnbull aims to introduce personal income tax cuts before the next fed-eral election, due in 2109, to complement the government’s drive to trim corporate rates.

The planned cuts to per-sonal tax are contingent on the government being able to maintain its commitment to get the budget back into surplus by 2021, Turnbull said. There’s capacity to reduce both busi-ness and personal taxes, he said. “How much we can do and when we do it will depend on the budgetary circum-stances, but yes the answer is we do have the ability to do it.”

Local rivals

Apple counts China as its third-largest region by sales but it has lost market share in recent years as high-end handsets from local rivals continue to gain traction.

Earlier this year, Apple said that developers had earned roughly $70bn in total revenue through the store.

Disney resumes acquisition talks with Fox: WSJSan FranciscoAFP

US media and entertain-ment giant Disney has renewed discussions for

the purchase of some of rival 21st Century Fox’s assets, The Wall Street Journal reported on Saturday.

Talks between the two began several weeks ago but fizzled due to disagreements over price, according to the newspaper.

Fox and WSJ parent News Corp share common owner-ship in the family-led empire created by mogul Rupert Murdoch.

Other companies such as Comcast, Verizon and Japan’s Sony have also expressed var-ying levels of interest, the report added, citing people familiar with the matter.

The discussions are focused on the Twentieth Cen-tury Fox movie and TV studio, some international assets like Fox’s 39 percent stake in Brit-ish satellite TV operator Sky,

India’s Star TV, and some US cable networks -- but not Fox News -- long seen as a jewel in the Murdoch family crown.

Disney is interested in solidifying its Hollywood and television positions and getting the Fox library of content to bolster its arsenal against Net-flix and other rivals.

Disney, which owns the ABC television network, ESPN and has major studios in Hol-lywood, is set to launch its own streaming services aimed at competing against Netflix, Amazon and Hulu.

The news comes as another major media deal, between AT&T and Time Warner, has been challenged in an antitrust filing by the US Justice Department.

The rise of streaming serv-ices and the so-called cord-cutting movement against cable television, together with declining adver-t is ing revenue, have contributed to a rapidly chang-ing landscape for media companies.

Liberia has two legal currencies: the Liberian dollar and the US dollar. The country also imports the vast majority of its food, and wholesale imports and taxes are payable in US dollars only.

Milan Reuters

Italian tax police have visited the offices of fashion company Gucci for fiscal checks as part

of an investigation by Milan pros-ecutors into suspected tax evasion, a senior source said. “Gucci confirms that it is

providing its full cooperation to the respective authorities and is confident about the correctness and transparency of its opera-tions,” Gucci said in an e-mailed statement in response to a report about the tax police audit pub-lished by Italian daily La Stampa on Saturday.

The source with direct

knowledge of the matter, who spoke on condition of anonym-ity, said the checks were carried out this week at Gucci’s Milan off ices and Florence headquarters.

The source said the Milan prosecutors suspected Gucci, which is part of French luxury group Kering, may have paid

taxes on profits generated by sales in Italy in another country with a more favourable tax regime. Gucci, the biggest contributor to Kering’s profits and revenues, has enjoyed a revival in recent years, and in the third quarter of 2017 reported a 49.4 percent rise in sales on a like-for-like basis, excluding currency swings.

Joon’s first commercial flight

25MONDAY 4 DECEMBER 2017 BUSINESS

Greece & lenders reach preliminary deal on reformsAthensReuters

Greece and its euro zone creditors reached a prelimi-nary deal on reforms that Athens needs to

roll out under its bailout pro-gramme, a move that could pave the way for the country to leave the aid plan in August.

The agreement, on Saturday, on a range of often politically sensitive measures - covering fiscal issues, energy and labour market reforms, bad loans and privatisations - could open up fresh loans and push Greece fur-ther along the path towards a return to full market financing.

“The institutions’ visit is completed, we closed the staff level agreement,” Greece’s Finance Minister Euclid Tsaka-lotos told reporters on Saturday.

“The European institutions have reached a staff level agree-ment with the Greek authorities on the policy package support-ing the ESM (European Stability Programme) programme,” an EU statement said on Saturday.

The agreement between

Greek officials and European Union and International Mone-tary Fund representatives on the country’s compliance with reforms and future commitments must be approved by euro zone finance ministers, scheduled to meet today.

Under the deal, Athens will need to implement a broad set of reforms as part of the so-called third review of its bailout programme.

Once concluded, the review is expected to release about ¤5bn in loans from the current ¤86bn bailout programme, its third since 2010. EU officials said this could be done before the end of January, if all proceeded smoothly.

At least another review of agreed reforms will be necessary before the end of the programme in August.

Athens and its lenders had been exchanging drafts on

agreed and proposed reforms for days. After seven years of aus-terity and rescue loans amounting to about ¤270bn ($320bn), Greece hopes its third bailout will be its last.

The government has been keen to swiftly conclude the review, which started in Octo-ber, to begin talks on debt relief and the terms of the country’s exit from the bailout programme.

“The speed with which this deal was reached is a signal that Greece is fully committed to con-clude the programme,” an EU official told Reuters.

The IMF’s full participation to the bailout programme is still subject to the IMF assessment of the agreed reforms.

On Friday Greece’s energy minister finalised a deal with creditors on the coal-fired plants the country will sell to comply with an EU court ruling.

GE lays off workers at New York power divisionNew York Reuters

General Electric Co (GE.N) said it was lay-ing off workers at its

power div is ion in Schenectady, New York, as it tries to reduce costs after a steep profit drop at the divi-sion. GE declined to disclose the number of workers affected.

A report by local ABC TV affiliate News10, citing sources inside GE’s Schenectady plant, said about 75 people had been notified that they are being let go.

So far this year, GE has laid off at least 75 other work-ers in New York state, according to state records.

GE Chief Executive John Flannery, who took over in August, has promised to cut $1bn in company spending this year and $2bn in 2018, as the company grapples with its weak financial results and declining share price. GE’s profit fell about 9 percent in the third quarter.

GE has grounded corpo-rate jets, eliminated company cars for hundreds of execu-tives, delayed part of its Boston headquarters and reduced employment in many locations.

The company has also changed a number of top executives, including install-ing a new CFO, and plans to exit more than $20bn in busi-ness in the next two years.

“GE has previously announced a plan to reduce $3 billion in cost by the end of 2018,” the company said in a statement. “Those actions include, but are not limited to, employee reductions, which have been under way for many months.”

GE said “a significant decline in orders” at GE Power prompted the layoffs in Schenectady. Workers will receive severance and help finding new jobs, GE said.

GE’s downsizing is not limited to its power division. In July, the company dis-closed plans to lay off 575 workers at a railroad locomo-tive plant in Erie, Pennsylvania.

An August report com-missioned by the United Electrical, Radio and Machine Workers of America Local 506, which represents the workers, estimated they earn about $108,000 a year in pay and benefits.

Hedge funds signal trust in Opec as short-sellers retreatNew YorkBloomberg

Hedge funds are giving oil exporters a big vote of confidence.

As the oil powerhouses pushed for the extension of sup-ply curbs ahead of Thursday’s Opec meeting, money manag-ers shifted their stance on West Texas Intermediate crude to the most bullish since February. That’s largely due to a strong decline in short-selling. Bets on rising Brent crude also increased as short positions slumped.

“There was definitely a con-sensus that we were going to see a six- to nine-month extension, so to be short in front of that obviously would not be a good positioning for hedge funds,” said Nick Holmes, an analyst at Tortoise Capital Advisors LLC, which manages $16bn in energy-related assets. “There was definitely some bullishness that we were going to see a pretty good result out of Opec, which we did.”

The Organization of Petro-leum Exporting Countries and

partners including Russia agreed on Thursday in Vienna to con-tinue with their output cutbacks until the end of next year. Rus-sia’s Energy Minister Alexander Novak said after the meeting that the deal was extended to show “long-term commitment” and it provides the opportunity for changes next year if needed.

Hedge funds raised their WTI net-long position -- the dif-ference between bets on a price increase and wagers on a drop -- by 15 percent to 396,484 futures and options in the week ended November 28, according to data from the US Commodity Futures Trading Commission. Shorts dropped by 39 percent, while longs advanced 6.5 per-cent. The Brent net-long position rose by 2.2 percent to 537,979 contracts, according to data from ICE Futures Europe. Longs increased by 1.1 percent, while shorts declined 9.1 percent to the lowest level since February.

WTI and Brent are trading near two-year highs after surg-ing more than 20 percent over the past three months as Saudi Arabia and Russia gradually built

momentum for their decision to prolong supply cuts. At the same time, stockpiles in the US have dropped significantly from their March peak.

That surge in prices could prompt hedge funds to take advantage of high prices to profit from selling, according to Mark Watkins, a Park City, Utah-based regional investment manager at US Bank Wealth Management, which oversees $142bn in assets.

“But longer-term, the re-bal-ancing trade is starting to work, so if they are in it for that longer-term play, keeping a long position would make sense,” Watkins said.

The question mark is the US shale response. UBS Group AG warned that any further rise in oil prices would likely ignite US shale output, while Barclays Plc said that Opec’s extension might boost nationwide production by another 1 million barrels a day by the end of next year. Yet Goldman Sachs Group Inc said the duration of Opec’s cuts helps to lessen the risk of a large increase in production from high available spare capacity..

Infosys names Capgemini’s Parekh as CEO after Sikka clashBengaluruBloomberg

Indian software-outsourcing giant Infosys Ltd. named out-sider Salil S Parekh

(pictured) as chief executive officer, ending the company’s search for a new leader after previous head Vishal Sikka quit following criticism from a group of founders, landing it in uncertainty.

Parekh, a member of the executive board at Capgemini SE with degrees from the Indian Institute of Technology and Cor-nell University in the U.S., has been appointed CEO and man-aging director for a five-year term that starts on Jan. 2, Ban-galore-based Infosys said in a statement Saturday.

Sikka had walked out in August after clashing with founders -- led by former chair-man Narayana Murthy -- who had run the business for three decades. Infosys is also being buffeted by changing technolo-gies, and needs to switch from basic paid-by-the-hour activi-ties like building software systems, which are fast getting automated, to higher-margin areas like digital services.

Current Chairman Nandan Nilekani said Parekh “has a strong track record of execut-ing business turnarounds and managing very successful acqui-sitions,” backed up by 30 years of experience in the global IT services industry.

Nilekani, the co-founder of Infosys, had returned as chair-man after Sikka’s exit and recast the board, soothing investor and employee concerns and bring-ing a degree of stability to the company. Pravin Rao, who had stepped in as interim chief, will become chief operating officer and whole time director.

At Capgemini, Europe’s

largest IT-services firm, Parekh had responsibility for an appli-cation-services unit that produced about half of group revenues. Ashutosh Sharma, research director at Forrester Inc. in New Delhi, said his appointment should close a “chapter of uncertainty” and re-energize Infosys in markets beyond North America, where outsourcers get the bulk of sales.

Though not regarded as one of the front-runners for the CEO post, Parekh is known as affa-ble but aggressive, qualities he may need to draw on in navi-gating the relationship with the powerful founder cohort at Info-sys, which has $10 billion in annual revenue.

Narayana Murthy said in an emailed statement that he was “happy” with Parekh’s appoint-ment and sent him “best wishes.”

While Infosys hired global headhunting firm Egon Zehnder in its search, Parekh has always worked in India, mostly in Mumbai. That’s in contrast to Stanford University-educated Sikka, who spent his entire career outside the subcontinent and ran Infosys from Palo Alto, California.

Fiat Chrysler in talkswith S Korea’s Hyundai over partnershipMilan Bloomberg

Fiat Chrysler Automobiles revealed that it’s in talks with South Korea’s

Hyundai Motor Co about a tech-nical partnership.

The alliance might become “a strong one,” though there is no likelihood of a merger between the companies, Fiat Chrysler Chief Executive Officer Sergio Marchionne said on Sat-urday at the Alfa Romeo Museum in Arese, near Milan.

“There is the potential of a technical partnership with Hyundai, which already sup-plies some components and transmissions for the US,” Mar-chionnetold reporters after a presentation on Alfa’s planned Formula One return. “Let’s see if we find a deal to develop transmission and hydrogen.”

Marchionne, a vocal propo-n e n t o f a u t o m a k e r consolidation, is preparing a five-year business plan before he retires as CEO in 2019. Coop-eration on hydrogen propulsion would come as rival plug-in

electric vehicles emerge as the dominant technology in the emerging post-fossil fuel era.

The CEO confirmed plans to spin off Fiat Chrysler’s Mag-neti Marelli and Comau component businesses into sep-arate companies by the start of 2019.

A spinoff of the Alfa Romeo and Maserati brands is too remote to be discussed at the moment, Marchionne said, while highlighting the impor-tance of motor racing in Alfa’s development. Marchionne has invested billions of dollars to develop new vehicles after the Alfa line-up shrank and sales collapsed in the last decade. F1’s global appeal will bring wider exposure after previous attempts to expand beyond Europe were delayed.

The CEO confirmed Fiat Chrysler’s financial targets for 2018, including an increase in operating profit to about ¤9bn ($10.7bn) and the elimination of debt, and said he anticipates “managable costs” from a die-sel investigation that Fiat is facing in the US.

Bailout programme

Once concluded, the review is expected to release about ¤5bn in loans from the current ¤86bn bailout programme, its third since 2010.

After seven years of austerity and rescue loans amounting to about ¤270bn, Greece hopes its third bailout will be its last.

Greek Prime Minister Alexis Tsipras (left) welcoming Chair of the Eurogroup finance ministers, Jeroen Dijsselbloem for their meeting in Athens in this file picture.

American Air reaches deal with pilots over scheduling errorNew York Reuters

American Airlines has reached an agreement with its pilots union over

premium pay for some Decem-ber flights, both groups said on Friday, after a scheduling snafu gave too many pilots holiday time off and sent the airline scrambling to correct its mistake.

“We are pleased to report that together, American and the Allied Pilots Association have put that worry to rest to make sure our flights will operate as scheduled,” American Airlines said in a statement.

An error in the system that bids for pilots’ time off based on seniority was responsible for approving too much time off to too many pilots in December,

American had offered its pilots 150 percent of their hourly pay rate to pick up cer-tain flights in the busy holiday

period, but APA complained that restrictions on premium pay and the ability to trade trips were in violation of the group’s contract.

“With this agreement in principle, we anticipate that American Airlines will be able to maintain a full December schedule as planned for its pas-sengers,” the Allied Pilots Association (APA) wrote in a statement to its members.

At its peak, APA estimated that more than 15,000 flights did not have pilots scheduled to fly them.

Both APA and American declined to detail the exact nature of the agreement, but the deal comes at a time when airlines’ rising labor costs are in the spotlight.

Earlier this year, a substan-tial mid-contract pay increase for American’s pilots and flight attendants spooked investors and temporarily sent the car-rier’s shares tumbling.

26 MONDAY 4 DECEMBER 2017BUSINESS

QATAR STOCK EXCHANGE

QE Index 7,756.55 0.55 %

QE Total Return Index 13,007.27 0.55 %

QE Al Rayan Islamic Index 3,056.28 0.79 %

QE All Share Index 2,162.31 1.23 %

QE All Share Banks &

Financial Services 2,468.54 0.57 %

QE All Share Industrials 2,374.59 1.00 %

QE All Share Transportation 1,592.36 0.76 %

QE All Share Real Estate 1,467.17 3.65 %

QE All Share Insurance 2,807.46 3.36 %

QE All Share Telecoms 966.03 0.00 %

QE All Share Consumer Goods & Services 4,451.01

0.90 %

QE INDICES SUMMARY QE MARKET SUMMARY COMPARISON WORLD STOCK INDICES

GOLD AND SILVER

03-12-2017Index 7,756.55

Change 42.29

% 0.55

YTD% 25.68

Volume 8,094,684

Value (QAR) 122,845,304.39

Trades 2,394

Up 30 | Down 08 | Unchanged 130-11-2017Index 7,714.26

Change 67.92

% 0.87

YTD% 26.09

Volume 16,079,384

Value (QAR) 1,226,703,544.27

Trades 5,626

EXCHANGE RATE

GOLD QR150.4457 per grammeSILVER QR1.9447per gramme

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

All Ordinaries 6096.053 29.32 0.48 6124.7 5635.1

Cac 40 Index/D 5425.55 35.07 0.65 5536.4 4733.82

Dj Indu Average 23836.71 255.93 1.09 23849.61 19062.22

Hang Seng Inde/D 29623.83 -57.02 -0.19 30199.69 21883.82

Iseq Overall/D 6924.86 49.93 0.73 7157.43 6369.05

Kse 100 Inx/D 39672.89 38.76 0.1 53127.24 39478.05

S&P 500 Index/D 2627.04 25.62 0.984847 2606.41 2245.13

Currency Buying SellingUS$ QR 3.6305 QR 3.6500

UK QR 4.8700 QR 4.9387

Euro QR 4.2825 QR 4.3431

CA$ QR 2.7989 QR 2.8540

Swiss Fr QR 3.6725 QR 3.7248

Yen QR 0.03212 QR 0.03274

Aus$ QR 2.7306 QR 2.7850

Ind Re QR 0.0560 QR 0.0571

Pak Re QR 0.0343 QR 0.0349

Peso QR 0.0717 QR 0.0732

SL Re QR 0.0235 QR 0.0240

Taka QR 0.0435 QR 0.0444

Nep Re QR 0.0350 QR 0.0357

SA Rand QR 0.2646 QR 0.2698

Brexit fears could harm Irish horse racing trade industryNaas AFP

Thoroughbred horse breed-ing is an instance where Ireland can claim to be

among the world’s best, but Brexit is giving the industry huge cause for concern.

Uncertainty over the future arrangements for exporting horses to Britain, its main mar-ket, has sparked frustration and anger in a sector worth more than ¤1.8bn ($2.1bn) to the econ-omy, and which supports almost 30,000 jobs.

“It is a huge employer in the countryside, so anything that damages it is something to be really worried about,” said Harry McCalmont, whose Nore-lands Stud is a prominent middle market breeder.

Talk of Brexit dominated last week’s foal and breeding stock sales at Goffs, Ireland’s premier public auction house, where buyers from across the world spent ¤41m.

The tone was set by a foal by star Irish-based stallion Galileo, which sparked a bidding war before the auctioneer’s gavel finally fell at the princely sum of ¤1.1m to an agent acting for an unnamed US buyer.

However, short-term joy about the lively trade could not blow away worries over what lies ahead.

Once Britain leaves the EU’s single market and customs union, horses could be subject to passport controls and delays at the border unless some new agreement is reached.

Figures compiled by audi-tors Deloitte showed Ireland sold horses worth ¤169m to England in 2016 -- 50 percent of the total sales at public auc-tion of Irish bloodstock.

Ireland is proud of its status in the Sport of Kings, and thou-sands of Irish enthusiasts make the pilgrimage every March to the Cheltenham National Hunt Festival in southwest England, where Ireland’s best jump

horses take on the best of the English. “It brings us a lot of prestige; we are the third-larg-est producer of thoroughbred foals in the world and we punch well above our weight,” McCa-lmont said.

But he warned: “Bigger operations might move and sell under the British banner but it is the smaller operations and people employed in the coun-tryside who are going to get hurt by this.”

His concerns are shared by Goffs chief executive Henry Beeby (pictured), who is angry with the lack of clarity from the British government. “I think there is a universal feeling of frustration and irritation,” said Beeby. “It is the fear of the unknown.

“The people who led the Brexit campaign really didn’t have a concise plan and I am pretty doubtful they have one now.” Beeby, who has been in his present role for 10 years, believes the British industry will suffer as well.

“They cannot be served by just the foal crop in England as they don’t produce enough horses. They need imports and the majority come from Ire-land,” he said.

Country will not close door to global Internet: China’s XiWuzhen Reuters

Chinese President Xi Jin-ping (pictured) said on yesterday the country

will not close its door to the glo-bal internet, but that cyber sovereignty is key in its vision of internet development.

Xi’s comments were read by Huang Kunming, head of the Chinese Communist Party’s publicity department at the country’s largest public cyber policy forum in the town of Wuzhen in eastern China.

“The development of Chi-na’s cyberspace is entering a fast lane. China’s doors will only become more and more open,” said Xi in the note. Cyber sov-ereignty is the idea that states should be permitted to manage and contain their own internet without external interference.

China’s Communist Party has tightened cyber regulation in the past year, formalising new rules that require firms to store data locally and censor tools that allow users to sub-vert the Great Firewall.

In June, China introduced a new national cybersecurity law that requires foreign firms to store data locally and submit to data surveillance measures.

Cyber regulators say the

laws are in line with interna-tional rules, and that they are designed to protect personal privacy and counter attacks on core infrastructure. Business groups say the rules unfairly target foreign firms.

China has advocated strongly for a larger role in glo-bal internet governance under Xi. “China stands ready to develop new rules and systems of internet governance to serve all parties and counteract cur-rent imbalances,” said Wang Huning, a member of the Com-munist Party standing committee at the event yesterday.

The conference, which is overseen by the Cyberspace Administration of China (CAC) invited foreign executives, Apple Inc’s CEO Tim Cook and Google Inc chief Sundar Pichai as well as a Facebook Inc executive.

Buy with bitcoin in New York, but it’s not cheap

At Melt Bakery, you can pay for your guilty pleasure in bitcoin. Melt

is one of several small stores in America’s biggest city now accepting the bitcoins, hailed by some as the future of cur-rency. Investors’ interest has been piqued by the virtual currency’s surging value while industry insiders see it as an alternative instrument for consumers who want to shop online but don’t have access to traditional instruments like a credit card.

It has even triggered an expanding ATM network that lets people turn their cash into bitcoins, and their bitcoins back into cash.

At Melt’s checkout coun-ter, each transaction can take several minutes to process and trigger varying fees.

That means a $5 chocolate ice cream sandwich cost $9.29 for a recent bitcoin purchase. Though its presence is grow-ing, bitcoin use is still far from widespread at the storefront level. More and more major companies now accept virtual currency, including Bitcoin but also others, as a valid form of payment -- from booking a flight on Expedia to a new sofa from retailer Overstock.

Opec and Russia just gave their most implacable foe, US shale, an early holiday gift.

As corporate boards for American oil explor-ers prepare to sketch out 2018 drilling budgets, Thursday’s historic agreement by Saudi Arabia, Russia and other major crude producers to extend supply caps for another year may prompt directors to spend more on drilling. That’s because the producer group’s restraint has meant higher prices for US shale drillers, who haven’t been shy about hiring more rigs or flooding global markets with more cargoes.

After climbing out of a crater dug by the worst oil-market collapse in a generation, North American explorers probably will boost spending by 20 percent next year, according to an Evercore ISI survey of industry budget trends. That would follow an estimated 41 percent jump in 2017.

“The North American E&P industry is very itchy to spend more capital dollars,” said James West, an Ever-core analyst who’s recognized as the keeper of the keys to North American spending data going back to the mid 1980s. “They’re in the board rooms right now talking about budgets and Opec is saying what they’re going to do through 2018.”

The timing of the announcement from Opec and its Russian ally was no doubt helpful to American drillers, West said. The prolonged nature of the extension that had been due to expire in March will reassure oil traders and provide investors and executives alike with a degree of comfort about price stability, he said.

Even as next year’s drilling budgets are in flux in the c-suite, explorers already are poised to ensnare any price blips stemming from the Opec-Russia deal. When crude prices rise, shale producers typically use financial instru-ments such as swaps and options to lock in prices for barrels they won’t pump until months from now, a proc-ess called hedging.

Right now, producers probably can secure hedges based on the US benchmark, West Texas Intermediate, that provide a floor in the low to mid $50s a barrel, Hanold said. About 60 percent of the expected production by com-panies in RBC’s coverage universe is already hedged, “a much fuller hedging book than in previous years,” said Hanold. Still, there’s room to do more, he said.

To assuage investors demanding that shale explorers live within their means and forego drilling wells with bor-rowed money, West said he expects companies initially to announce budgets based on more conservative esti-mates of around $50.

Andre Burba, partner at the New York-based invest-ment firm Pine Brook Road Partners LLC, said he doesn’t expect a material revision in drilling budgets based upon the Opec-Russia decision. Rather, it’s affirming their orig-inal plans before the Opec meeting.

Burba, whose firm’s $4bn under management includes a portfolio of about a dozen North American explorers, said Friday in a phone interview. “Adding that element of stability and given the time frame of this extension, it was a very very helpful step.” Ultimately, shale’s voracious appetite for growth may very well eat the rally that allowed it to grow in the first place. If output from US shale fields continues expanding next year on the back of Opec’s ascet-icism, individual discipline will slip, member nations will abandon the alliance, and a new price-killing glut will emerge, according to analysts at ESAI Energy LLC.

“What tastes good today will become too rich later in 2018,” the ESAI analysts said in a note to clients. As shale output escalates, “the deal will begin to quietly unravel. This means higher prices in the short-term, but lower prices by 2019.”

Senate Republicans narrowly approved the most sweeping rewrite of the US tax code in three decades, slashing the corporate tax rate and providing temporary tax-

rate cuts for most Americans.The 51-49 vote—achieved just before

2am Saturday in Washington and only after closed-door deal-making with dissident sen-ators—brings the GOP close to delivering a much-needed policy win for their party and President Donald Trump.

Before it goes to Trump, lawmakers will have to resolve differences between the Sen-ate bill and one the House passed last month, a process that could begin today. Although both versions share common top-line ele-ments, negotiations on individual provisions inserted to win votes, particularly in the Sen-ate, may be protracted and difficult. The final product will end up being a central issue in the 2018 elections that will determine con-trol of Congress.

Speaking in New York on Saturday, Trump also predicted the tax package would be a winner for Republicans in the 2018 mid-term elections. Both the House and Senate measures would cut the corporate tax rate to 20 percent from 35 percent—though the Senate version would set that lower rate in 2019, a year later than the House bill would. The House and Senate bills also align on the contentious issue of individual deductions for state and local taxes: They’d eliminate all but a deduction for property taxes, which would be capped at $10,000.

But they differ on the home mortgage-interest deduction; the House bill would restrict that break to loans of $500,000 or less with regard to new purchases of homes. The Senate legislation would leave the cur-rent $1m cap in place.

They also differ—narrowly—on the tax

rates they’d apply to multinational compa-nies’ accumulated offshore earnings. The House bill would tax those profits at 14 per-cent for earnings held as cash and 7 percent for less-liquid assets. The revised Senate bill contains a lengthy section that has no direct mention of the rates, but a person familiar with the Senate plan said they’d be 14.5 per-cent for cash and 7.5 percent for less-liquid assets. That narrow majority made it impor-tant for Senate leaders to try to hold every member’s vote; moderate Senator Susan Col-lins of Maine used that leverage to secure various concessions, including an agreement to enhance an individual deduction for large unreimbursed medical expenses through the end of next year. The House bill would elim-inate that tax break.

Democrats decried the bill’s deficit impact and complained they were shut out of the process to help draft the measure. They cited research showing that the legislation primarily benefits the nation’s highest earn-ers and business owners, and will bleed federal revenues in a way that hurts domes-tic programs. Attention now shifts to a House-Senate conference committee—a spe-cially appointed, temporary panel that will be charged with hashing out the differences in the bills and preparing a final version for both chambers to consider. Party leaders will select a small group of lawmakers, likely from the House and Senate tax-writing pan-els in each chamber, who would then be approved by each chamber.

Both bills share some key central ele-ments: They both almost double the standard deduction for individual taxpayers while eliminating personal exemptions. They both allow companies to fully and immediately deduct the cost of their spending on equip-ment for five years. But the Senate version would slowly step down the expensing pro-vision after the five-year period—a feature that the House bill doesn’t provide for.

Yet there are many differences—rang-ing from the taxation of business income to

the amount set for the child tax credit—and Senate negotiators may have the upper hand during talks. That’s because the wafer-thin two-vote majority in the Senate will make it harder to usher a final bill back through that chamber. The House bill would consol-idate the current seven individual tax brackets to four, leaving the top tax rate at 39.6 percent. The Senate bill would have seven brackets—with lower rates, and a top rate of 38.5 percent. Studies have shown that many of the tax bill’s benefits would go to the highest earners—and some middle-class taxpayers might actually pay more—a find-ing that could impact the House-Senate talks.

The Senate bill includes a repeal of Obamacare’s mandate that most Americans have health insurance or pay a penalty. The House bill does not.

Senators approved a 23 percent tax deduction—subject to certain limitations—on business income earned from partnerships, limited liabilities and other so-called pass-through businesses. The House version would create a 25 percent tax rate for such business income—with restrictions on which businesses could qualify. Small businesses would get extra relief under the House legislation as well. The House bill would also eliminate the estate tax, while

the Senate version would limit the tax to fewer multi-million-dollar estates, but leave it in place. And after 2025, the limits would lift.

Brussels AFP

Jeroen Dijsselbloem, who steps down as chair of the Eurogroup today, rose from obscurity to

become an unflappable dealmaker who helped guide Europe through the worst of the Greek debt crisis.

Only two months after becom-ing Dutch finance minister in November 2012, Dijsselbloem was thrust into heading the powerful Eurogroup of 19 finance minis-ters—and headlong into the crisis in Cyprus. In a baptism by fire, the straight-talking Dijsselbloem drew

criticism for his handling of the 2013 bailouts, put down mainly to his inexperience in navigating the treacherous waters of a global economy in meltdown.

He was criticised for a bailout that forced the closure of a major Cypriot bank, and then sent mar-kets into a tail-spin when he said the Cyprus plan could serve as a template for future bailouts—an off-the-cuff observation that in the end turned out to be partly true.

A clumsy turn of phrase would become a running motif for Dijs-selbloem, who last year drew the fury of southern Europeans with a quip that implied that bailed out countries spent their money on “drinks and women”. Despite the bumps, the curly-haired Dijssel-b l o e m — p r o n o u n c e d “day-sell-bloom”—stoically weathered the storms and ends his tenure respected for his cool and calm approach.

The 51-year-old is “serious, patient, and someone who fought

hard to win the deep trust of his partners”, former French finance minister Michel Spain told AFP.

“Despite his usual reserve, he became a true friend,” Sapin said.

Taking exception to the plau-dits would be Yanis Varoufakis, Greece’s former finance minister, a leftwing firebrand with whom Dijsselbloem frequently battled over Greece’s bailout programme. The pair—one besuited and bespectacled, the other shaven-headed and fond of leather jackets and motorcycles—famously shared the tensest of handshakes after one early meeting and reportedly almost came to blows.

But, strongly backed by the powerful German finance minis-ter Wolfgang Schaeuble, who has also recently left office, Dijssel-bloem bloomed into a skilled and no-nonsense negotiator.

His first breakthrough came in early 2014, when he put together Europe’s banking union, an ambitious project devised to

protect taxpayers from forking out public funds in case banks go bankrupt. Against the odds, Dijs-selbloem found agreement between different European insti-tutions as well as France and Germany. But it was the third res-cue of Greece in 2015, with an Athens run by radical leftists, that took up much of “Mr Euro’s” time.

Despite his sparring with the maverick Varoufakis, Dijsselbloem maintained dialogue with Athens as default loomed, travelling to discuss the issues with Greek Prime Minister Alexis Tsipras.

The Dutch centre-left news-paper De Volkskrant once described him as “a little stuffy and as loyal as a guide dog” who didn’t seek the limelight.

Dijsselbloem studied agricul-tural economics in the Netherlands and business in Ireland and early on acquired a reputation as a backroom strategist. Positioned on the right of the Netherlands’ left-of-centre Labour party,

Dijsselbloem shares his party’s pro-European vision, while back-ing balanced budgets and austerity measures. This stance would cost him and his party dearly, losing miserably in elections earlier this year.

Dijsselbloem was born in the southern city of Eindhoven, into a mostly apolitical family. His political awakening came at 15 when he took part, against his par-ents’ will, in a 1983 protest against a Cold War nuclear missile instal-lation. Father to a teenage son and daughter, Dijsselbloem is an admirer of Miles Davis and of the British comedy series “Monty Python’s Flying Circus”.

In his spare time, he enjoys reading books on economic mat-ters and dancing tango with his wife. Dijsselbloem would also like to spend more time on his other hobby: raising chickens and pigs and working in his garden in the central Dutch city of Wageningen.

Shale drillers `itchy’ to plow Opec’s gift into more US wells

David Wethe & Kevin CrowleyBloomberg

Senate passes tax-cut bill in move toward overhaul

A general view of the Capitol building in Washington DC, US.

Laura Litvan & Sahil KapurBloomberg

The House & Senate bills also align on the contentious issue of individual deductions for state and local taxes: They’d eliminate all but a deduction for property taxes, which would be capped at $10,000.

His first breakthrough came in early 2014, when he put together Europe’s banking union, an ambitious project devised to protect taxpayers from forking out public funds in case banks go bankrupt.

Last tango for Eurogroup chief Jeroen Dijsselbloem

BUSINESS VIEWS 27MONDAY 4 DECEMBER 2017

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Capital Comment

WeWork’s designers think of the giant staircase that connects three floors of its headquarters in Chelsea, New York as a series of occasional meeting spaces, but also as a kind of indoor park.

World Smartphone Market share US manufacturing sector activity stays strong in November: ISMNew York AFP

The key US manufacturing sector continued to grow at an above average rate

in November, as the impact of back-to-back hurricanes over the summer recedes, according to an industry survey released Friday.

Output spiked and employ-ment remains strong to produce “a really strong report” on the sector, the Institute for Supply Management (ISM) said.

The ISM’s purchasing man-agers index slowed to 58.2 percent from 58.7 in October, but remained well above the average for the past year, with 14 of the 18 industries surveyed reporting growth. Any reading above 50 indicates growth in the sector.

However, the decline actu-ally reflects an improvement in conditions following the hurri-canes, as transportation issues from storms are being over-come, Timothy Fiore (pictured), chair of ISM’s Manufacturing

Business Survey Committee, explained.

The supplier deliveries index fell nearly five points to 56.5 percent, which indicates ship-ments are speeding up.

Manufacturers expected to see three months of transporta-tion difficulties in the wake of the hurricanes—especially Hur-ricane Harvey’s hit to the key chemical and oil production facilities in Houston—as well as six months of impacts on prices, Fiore said.

He noted that only five

percent of comments from the manufacturers surveyed men-tioned the hurricanes, down sharply from the prior two months.

The report showed a three-point jump in the production index to 63.9 percent, and a more than half-point rise in new orders to 64 percent, while employment slipped a tenth to a still-strong 59.7 percent.

The only industries report-ing contraction were wood and petroleum and coal.

Fiore said industries reported that “price pressures continue,” with 16 of the 18 sec-tors surveyed reporting increases. The price index slipped three points to 65.5 per-cent. The comments from the companies surveyed indicate a strong surge into 2018, with many noting they are not see-ing the usual year-end slowdown in orders.

“We are just coming off a record sales year. We expect to continue in 2018 robust activ-ity,” one manufacturing firm said.

Employment continues to grow at a solid pace, wage growth will accelerate and consumer confidence just hit a 17-year high, so industry sales should remain strong.

Mustafa Mohatarem, Chief Economist, General Motors.

Amazon Inc leaves Mexico e-commerce pioneer in the dustBloomberg

One of the first Mexi-can retailers to sell online is quickly fall-

ing behind newer arrivals, and it may be too late to catch up, according to Credit Suisse.

El Puerto de Liverpool, which conducted its first e-commerce transaction in 1997, is spending just a frac-tion of the amount as Amazon.com Inc, Merca-doLibre Inc and Wal-Mart de Mexico SAB on bolstering Internet operations in Mex-ico. Instead, its shares have tumbled to a five-year low amid a focus on opening new brick-and-mortar stores at a record pace.

Liverpool, which traces its roots to a Mexico City clothing store set up in 1847, offers fewer products online than its peers do and many of its items can only be pur-chased in stores.

Shipping is free but can take longer than five days when there’s high demand, compared with as little as one day for some Amazon orders.

Perhaps most impor-tantly, it doesn’t accept cash payments for online pur-chases, which cuts off a big chunk of the population in Mexico, where fewer than half of adults have credit cards.

“Liverpool’s business model is largely threatened,” Credit Suisse analysts led by Antonio Gonzalez wrote in a note this week.

“Investors should no longer think about e-com-merce in Mexico as a phenomenon that will

impact stock prices in the distant future. The future for e-commerce is now.”

While online shopping only represents about 3 per-cent of retail sales in Mexico, analysts at HSBC predict it’s set to grow substantially after Amazon introduced its Prime membership club to Mexico earlier this year.

A potential change to the North American Free Trade Agreement that would let Mexican consumers buy more online from the US and Canada without having to pay tariffs could also lead to m o r e c r o s s - b o r d e r e-commerce.

Liverpool shares have tumbled 17 percent this year. Walmex has gained 18 per-cent and Mexico’s benchmark stock gauge is up 3.7 percent.

Alejandra Tovar, a spokeswoman for Liverpool, didn’t immediately respond to a request for comment.

El Puerto de Liverpool is planning to open 11 stores this year, expanding floor space by 6 percent, accord-ing to its latest earnings report.

But it’s only invested about $30m on e-commerce in Mexico during the past few years—the same amount that MercadoLibre has invested on free shipping in Mexico this year alone, according to Credit Suisse. Wal-Mart de Mexico has spent about $190m on online efforts during the past two years, Credit Suisse says.

Amazon, which entered Mexico in 2015, is planning to open a warehouse near Mexico City that would tri-ple its distribution space.

WeWork becomes economy starSan Francisco AFP

Going to the office isn’t what it used to be. As more workers shift to on-

demand and “gig” employment, the workplace has changed, and no company has capitalized on this more than WeWork.

With free-flowing coffee, the smartly designed offices that have popped up in dozens of cit-ies in some 20 countries have become coveted by small firms and freelancers in technology and other sectors.

WeWork, with a whopping valuation by investors of $20bn, has taken the lead in the co-working space and in the process is disrupting the office and real estate market.

“At WeWork, we want to create a world where people work to make a life, not just a living,” says chief executive Adam Neumann, who co-founded the group in 2010 in New York with Miguel McKelvey.

Those who rent desk space

or enclosed offices at WeWork are not just clients, they are members of a “community” under the WeWork credo.

Started in New York, WeWork has expanded to some two dozen US cities and around the world in Brazil, Argentina, China, Japan, India, Ireland and Israel, among others, and claims more than 150,000 members.

WeWork supplies an inter-net connection, cleaning service, a reception desk and more. In San Francisco, the $400 monthly rent offers a workspace in a shared office, while an enclosed office for several peo-ple may cost several thousand dollars.

The monthly deals can be particularly attractive to inde-pendent workers who don’t want to make a long-term com-mitment. But WeWork also rents to employees of large firms such as IBM where regional offices are less convenient.

WeWork’s annual revenues have topped $1bn, according to Neumann, amid speculation the group would launch a public

share offering. Steve King, ana-lyst at Emergent Research, said WeWork’s strength is building a sense of community, allowing its members to benefit from the network of co-workers from diverse sectors.

WeWork offers a mobile application that enables users to contact other members, and be notified of events ranging from parties to manicures.

Expanding its mission, WeWork has begun a handful of “co-living” spaces that offer some of the same perks, and recently acquired the online social network Meetup—which keeps members apprised of events ranging from tech net-working sessions to sporting events—and the Flatiron School, which provides online and offline classes and training.

But WeWork’s most visible move came in October with the announcement it would buy the landmark Lord & Taylor store on New York’s Fifth Avenue—vastly increasing its visibility with the historic building that will become its new

headquarters, with expanded co-working space. As it ramps up its business, WeWork defies categorization.

While it’s not quite a tech company, “they want to be a tech-enabled company that’s creating human interaction,” according to King.

WeWork has risen to the top of a crowded field of co-work-ing rivals, and earlier this year got a $4.4bn capital infusion from Japan’s SoftBank Vision Fund.

“WeWork is disrupting pre-conceived notions of work styles and opening up myriad oppor-tunities for the next generation of creators around the world by taking a scientific approach that fully utilizes the latest technol-ogies,” said SoftBank chairman and CEO Masayoshi Son.

The WeWork model has yet to be tested in a weak economy, and King points out the model carries some risk because WeWork has to buy real estate or sign long-term leases for its space while renting to members on short-term deals.