China hopeful on US trade talks: official

Chinese Vice Commerce Minister and Deputy China International Trade Representative Wang Shouwen at a news conference during the ongoing session of the National People’s Congress (NPC) in Beijing, China on March 9, 2019. (Reuters)
Updated 09 March 2019
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China hopeful on US trade talks: official

  • China and the US have been locked in a bruising trade war since last year, imposing tit-for-tat tariffs
  • Top-level negotiators have met thrice in an attempt to reach an agreement ahead of next week

BEIJING: Beijing is hopeful about its next round of trade talks with the US, China’s vice minister for commerce said Saturday, after revealing that top negotiators had tried to hammer out a deal over burgers and eggplant chicken.
China and the United States have been locked in a bruising trade war since last year, imposing tit-for-tat tariffs on more than $360 billion in two-way trade, which has left global markets reeling.
Top-level negotiators have met thrice in an attempt to reach an agreement ahead of next week, when additional tariffs could be levied on Chinese goods entering the US as a truce period expires.
“When you ask about the prospects for the next Sino-US economic and trade consultation, I feel that there is hope,” Vice Minister for Commerce Wang Shouwen told journalists at a press briefing on the sidelines of China’s National People’s Congress.
He added that Beijing’s top economic official Liu He and US Trade Representative Robert Lighthizer held talks over a packed lunch of burgers and eggplant stir-fried with chicken — a common Chinese dish — in Washington last month.
“Vice Premier Liu ate a beef burger, and Lighthizer ate eggplant and chicken (with rice),” Wang said.
“Throughout the consultation process, there was coffee and tea... but both drank plain water.”
“This was to find common ground,” he added.
Chinese Commerce Minister Zhong Shan had on Tuesday said the negotiation process was very “difficult and taxing” with “lots left to do,” but that breakthroughs had been made in several areas.
But there have been conflicting comments from Washington and Beijing on the negotiations.
Donald Trump on Friday said he remains optimistic but will not sign a pact unless it is a “very good deal,” and a top economic adviser said the US president could walk away from a bad deal.
Commerce officials also said a foreign investment law — widely expected to be passed by China’s rubber-stamp parliament next Friday — will allow foreign companies to take part in government tenders.
Only 48 sectors remain on a “negative list” where foreign investment is either prohibited or requires special approval, Wang told journalists.
“The (whole process) is open and provides important legal protection for foreign investors.”
Aimed at assuaging concerns about China’s business environment for foreign firms, Beijing sees the law as a tool to attract more foreign investment as its economy slows.
The bill will ban the illegal transfer of technology and “illegal government interference” in foreign businesses, a key complaint from Washington.


Saudi Real Estate Refinance Co. plans up to $1.07bn sukuk sale this year

Updated 23 April 2019
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Saudi Real Estate Refinance Co. plans up to $1.07bn sukuk sale this year

  • The plan by SRC, a subsidiary of Saudi Arabia’s sovereign Public Investment Fund, comes as it prepares to purchase more home loan portfolios
  • SRC, formed in 2017, is also keen to tap foreign institutional investors for its debt sale this year

RIYADH: Saudi Real Estate Refinance Co. (SRC), modelled on US mortgage finance firm Fannie Mae, aims to issue up to 4 billion riyals ($1.07 billion) of long-term sukuk this year, its chief executive said on Tuesday.

The plan by SRC, a subsidiary of Saudi Arabia’s sovereign Public Investment Fund, comes as it prepares to purchase more home loan portfolios from mortgage financing companies and banks to boost the Kingdom’s secondary mortgage market.

SRC, formed in 2017, is also keen to tap foreign institutional investors for its debt sale this year, Fabrice Susini told Reuters in an interview.

“Our strategy is clearly to tap the market twice this year,” he said. “We are really looking at probably issuing something between ... 2 and 4 billion riyal that we may be issuing in two tranches.

He said SRC was looking at sukuk in the 10 to 15-year range, to help minimize refinancing risks. “Generally speaking we are trying to issue as long as possible,” Susini said.

He said the company was assessing whether it could also issue bonds in currencies other than the local riyal.

In March, SRC completed a 750 million riyal sukuk issue with multiple tenors, under a program that allows it to issue up to 11 billion riyals of local currency denominated Islamic bonds.

“The rule of the game for us is, like many projects across the Kingdom, attract liquidity from foreign investors,” Susini said.

He said SRC had spent 1.2 billion riyals from its balance sheet buying mortgages from local mortgage financing companies and provided liquidity to these firms.

It has also signed initial accords with several commercial banks to acquire housing mortgage portfolios.

Saudi Arabia’s housing ministry is targeting the mortgage market to reach a total value of 502 billion riyals by 2020 from around 300 billion riyals now.

The government wants to increase activity in the real estate market as it moves to revitalize the economy and is taking steps to reform the sector as part of its 2030 reform plan.

It has been working with developers and local banks to counter a shortage of affordable housing — one of the country’s biggest social and economic problems. Saudi Arabia wants 60 percent of its nationals to own homes by 2020, up from 47 percent in 2016.

The size of real estate financing relative to its gross domestic product is 5 percent in Saudi Arabia compared to 69 percent in the United States, 74 percent in the United Kingdom and 43 pct in Canada, the housing ministry has said.

“The goal of SRC in this market was to make sure that we will be able to refinance at least around 10 percent of the market in 2020, and 20 percent of the market by 2028,” Susini told Reuters.