Time to tear down Mideast trade barriers, Davos panel hears

A panel at Davos heard how an agreement between Saudi Arabia and the UAE to boost cooperation could be a blueprint for the wider region. (Reuters)
Updated 23 January 2019

Time to tear down Mideast trade barriers, Davos panel hears

  • Mohammad Al-Tuwaijri, Saudi minister of economy and planning, said a move to ease movement of traffic across the border could be followed elsewhere
  • Majid Al Futtaim CEO Alain Bejjani: Now there’s this seriousness between Saudi Arabia and the UAE, I hope it gets to frictionless trade

DAVOS: Amid global trade wars and the rise of protectionism, Middle East economic and business leaders on Tuesday issued a clarion call for the exact opposite: To ease customs restrictions in the region.
A panel at Davos heard how an agreement between Saudi Arabia and the UAE to boost cooperation — including the reduction of obstacles to trade across the shared border — could be a blueprint for the wider region.
Mohammad Al-Tuwaijri, Saudi minister of economy and planning, said a move to ease movement of traffic across the border — partly through the use of technology — could be followed elsewhere. “We want to establish a reference for others to follow,” he said.
Alain Bejjani, CEO of retail and leisure group Majid Al Futtaim, said “frictionless trade” would give the region a boost.
“Now there’s this seriousness between Saudi Arabia and the UAE, I hope it gets to frictionless trade,” he told Arab News on the sidelines of the Davos forum.
Bejjani declined to say whether that would involve a customs union, a common market or a common currency. Given the imposition of trade tariffs between the US and China, and the rise of Brexit, globalization — something espoused by many Davos delegates — is seen as on the wane.
But Bejjani said breaking down barriers in the Middle East could help it better compete with Western Europe and the US.
“For the past almost century now… we’ve been ingeniously working on making sure we put barriers across the Arab world. The reality is we have a market that’s as big as most of the largest markets in the world… if we’re smart enough to work together,” he told the Davos panel.
Khalid Al-Rumaihi, chief executive of the Bahrain Economic Development Board, agreed that Saudi-UAE cooperation was “a great template” for others to follow.
Aside from “opening up” Middle East markets, Al-Rumaihi said harmonizing regulation in the region would also be beneficial to businesses and entrepreneurs.
“If the rules are changing in each country, if they’re not harmonized, it’s very difficult… for an entrepreneur (to understand) the regulatory environment. So they don’t scale very quickly, and that’s something we need to solve,” he said. Talk of freer trade within the Middle East is especially relevant when it comes to the Palestinian territories, which are subject to Israeli occupation and blockade.
Palestinian Prime Minister Rami Hamdallah said freer movement and a reduction of duties would help the economy grow.
“We need to see our products being waived (of) customs,” he said. “We need mobility — we’re under occupation.”


Qantas Airways profits lower after oil prices rise

Updated 6 min 19 sec ago

Qantas Airways profits lower after oil prices rise

  • The 99-year-old airline was hit by an Aus$614 million fuel bill increase and Aus$154 million in foreign exchange impacts

SYDNEY: Qantas Airways posted a 6.5-percent fall in annual net profit Thursday, attributing the slide in earnings to higher oil prices and a weaker Australian dollar.
Despite record revenues, the Australian flag carrier said its after-tax profit fell to Aus$891 million ($604 million), down from Aus$953 million the previous year.
The 99-year-old airline was hit by an Aus$614 million fuel bill increase and Aus$154 million in foreign exchange impacts.
But Qantas CEO Alan Joyce was upbeat about the results, which came on the back of healthy profits the previous year.
“Even with headwinds like fuel costs and foreign exchange, we remain one of the best-performing airline groups in the world,” he said.
In the 12 months to June 30, underlying profit before tax — the airline’s preferred measure that strips out one-off costs — was down 17 percent at Aus$1.3 billion.
Qantas declared a final dividend of 13 cents per share and announced an off-market buyback of up to 79.7 million shares.
It will also hand its workers travel bonuses worth Aus$32 million.
Joyce said the outlook for the airline was “mixed,” with weakness in the domestic tourism market and flat corporate travel demand.
Nevertheless, he said the airline was “confident” about the year ahead due in large part to being in a “strong financial position.”