China manufacturing weakens amid US tariff battle

China manufacturing weakens amid US tariff battle
Trump stepped up pressure by raising tariffs on $200 billion of Chinese goods. (File/AFP)
Updated 30 September 2018

China manufacturing weakens amid US tariff battle

China manufacturing weakens amid US tariff battle
  • The resiliency of China’s $12 trillion-a-year economy until now has allowed President Xi Jinping’s government to reject pressure for changes in initiatives
  • Trump stepped up pressure by raising tariffs on $200 billion of Chinese goods

BEIJING: China’s export orders shrank in September as a tariff battle with Washington over technology escalated, adding to downward pressure on the world’s No. 2 economy, two surveys showed Sunday.
The reports add to signs Chinese trade, which had held up despite US President Donald Trump’s tariff hikes, might be weakening. That adds to pressure on an economy that already was forecast to cool due to slowing global consumer demand and lending controls imposed to rein in a debt boom.
The official China Federation of Logistics & Purchasing’s monthly measure of new export orders fell to 48 from August’s 49.4 on a 100-point scale on which numbers below 50 show activity shrinking.
A separate index by a business magazine, Caixin, showed new export orders fell at the fastest rate in more than two years. The magazine said companies blamed “trade frictions” and tariffs.
Overall, the federation’s monthly purchasing managers index showed manufacturing activity decelerated to 50.8 from August’s 51.3. Caixin said its index fell to 50 from 50.6.
“Downward pressure on China’s economy was significant,” economist Zhengsheng Zhong said in Caixin’s report.
The resiliency of China’s $12 trillion-a-year economy until now has allowed President Xi Jinping’s government to reject pressure for changes in initiatives such as “Made in China 2025” that call for state-led creation of champions in robotics and other technologies.
Washington, Europe and other trading partners say those violate Beijing’s market-opening obligations.
The International Monetary Fund and other forecasters expect this year’s economic growth to fall to about 6.5 percent from 2017’s 6.8 percent. But that slowdown is due mostly to the ruling Communist Party’s long-term efforts to steer China to self-sustaining growth based on consumer spending instead of trade and investment.
Last week, Trump stepped up pressure by raising tariffs on $200 billion of Chinese goods. Beijing retaliated with penalties on $60 billion of American imports. Both sides already had raised duties on $50 billion of each other’s goods.
The two sides have announced no plans for negotiations. China accused Trump in a report last week of bullying other countries. A deputy commerce minister said negotiations were impossible while Washington “holds a knife” of tariff hikes to Beijing’s throat.
With no settlement in sight, forecasters say the conflict could trim global economic growth by 0.5 percent through 2020.
Sunday’s reports gave no details on September orders from the United States, China’s biggest national export market.
Sales to the United States have held up so far, rising by more than 13 percent in August. But analysts said that strength might have been due partly to Chinese suppliers rushing to beat increases in import taxes.
American officials complain Beijing steals or pressures companies to hand over technology. They worry Chinese technology initiatives might erode US industrial leadership.
Communist leaders have tried to stick to long-term reform plans the ruling party says will make the state-dominated economy more competitive and productive.
Beijing has cut import tariffs and announced plans to open auto manufacturing and some other industries wider to foreign competitors. But none of their changes address the US technology complaints.
Last week, Beijing announced tariff cuts, effective, Nov. 1, on 1,585 types of goods including construction equipment.
Chinese leaders should act quickly to “expand domestic demand and resolve the short-term downward pressure,” economist Zhang Liqun said in the logistics federation’s report.
Trade’s importance to China has shrunk but it still supports millions of well-paid jobs. The United States is the destination for the highest-value Chinese exports including smartphones, industrial machinery and medical technology.
The logistics federation’s employment index fell 1.1 points to 48.3, indicating workforces were shrinking.
“The employment situation worsened further,” Zhong said in Caixin’s report.


Hilton aims to nearly quadruple KSA hotel network by 2025

Hilton aims to nearly quadruple KSA hotel network by 2025
Updated 21 June 2021

Hilton aims to nearly quadruple KSA hotel network by 2025

Hilton aims to nearly quadruple KSA hotel network by 2025
  • US hotelier plans to hire about 5,000 Saudis over next decade in expansion drive

RIYADH: The Hilton Garden Inn Riyadh Financial District is the latest opening in Saudi Arabia by the famous US hotelier, but the company has big plans in the pipeline for the Kingdom, including more than 40 new properties and the recruitment of thousands of Saudi professionals.

“Saudi Arabia is an important market for us,” Jochem-Jan Sleiffer, president of Hilton Middle East, Africa and Turkey, told Arab News. “We’re trying to expand all of our different brands as much as we can in the right cities.”

Hilton — which has a regional office in Jeddah — today has 18 brands across 119 countries, and more than 6,500 properties worldwide. The Middle East now has 61 Hilton hotels with 85 more in the pipeline, 41 of which will be in Saudi Arabia over the next three to four years.

“If I look at Saudi Arabia, at all the cities, every country should at least have a Hampton or Garden Inn,” Sleiffer said. “Mid-market hotels should be in every city in Saudi Arabia, and currently there is more demand for hotels than there is supply.”

The Waldorf Astoria, Hilton’s most luxurious brand, has operated in Jeddah for many years, alongside the likes of brands including Conrad, Hampton and DoubleTree. On deciding which brand to introduce in a given city, Sleiffer said that an analysis of the market and a future forecast is necessary to understand the demographics of potential guests.

Of the 41 pipeline projects, most will be “upscale,” like DoubleTree, while others will cater to the mid-market segment, like Garden Inn. “This is where the bulk is, the upscale and mid-market. Pre-pandemic, Saudi Arabia has had strong demand in the business segment and religious tourism, but now the leisure demand is much bigger,” he said.

With international travel having restarted in the Kingdom on May 17, Sleiffer said that people are desperate to travel again and go to places they have not been before, like Saudi Arabia.

“In the next two years, we expect to hire about 2,000 people. Over the next 10 years, 10,000 people — half of which will be Saudis. I want Saudis to run these hotels. We have training programs and we have a Hilton university which has more than 5,000 online training courses.”

The Hilton president said that according to figures from the World Travel and Tourism Council, one in 10 jobs are in hospitality and tourism, but added: “Saudi is low where that’s concerned, so we need to bring it up here as well. It will come up, I have no doubt — take Hilton Riyadh as an example, where 44 percent of current staff is Saudi.”

Demand is certainly there, as a survey in December commissioned by The Red Sea Development Co. found that about nine in 10 young Saudis surveyed said they would be keen to work in the tourism and hospitality sectors, compared to 77 percent who said they were interested in a job in petrochemicals.

When the pandemic hit more than a year ago, Hilton shifted its focus to three things: The safety of staff and customers, the community around hotels, and property.

This involved postponing investment deals to help preserve cash, adapting to safety protocols, and making layoffs where necessary. However, as vaccination rates picked up, Hilton has been begun rehiring at an accelerated rate, Sleiffer said.

“We put emphasis on the touchpoints in the room, the light switches, and the remote controls. We developed Hilton CleanStay and Hilton EventReady for meetings,” he added.

Mobile check-in and digital key — developed by Hilton before the pandemic — has been a significant feature that has decreased interactions between staff and customers, reducing the potential spread of coronavirus.

Sleiffer also hopes to expand the Hilton brand to the Kingdom’s megaprojects, such as NEOM and the Red Sea Project.

“There’s more coming,” he said, mentioning his excitement about the upcoming Formula One race in Jeddah in December this year, where Hilton is serving as the official sponsor of McLaren Racing.


Riyadh, Moscow seek closer currency, trade links

Riyadh, Moscow seek closer currency, trade links
Updated 21 June 2021

Riyadh, Moscow seek closer currency, trade links

Riyadh, Moscow seek closer currency, trade links
  • Saudi exports to Russia represent just 2.5 percent of the volume of trade between the two countries

RIYADH: Tariq Abdel Hadi Al-Qahtani, chairman of the Saudi-Russian Business Council (SRBC), has stressed the importance of conducting transactions in Russian rubles and Saudi riyals as part of efforts to strengthen the currencies of both countries and encourage increased bilateral trade.

Al-Qahtani, who headed last week’s SRBC meeting in Riyadh, also said they had come a long way in resolving the visa issue between the countries and there would be news on this soon.

Al-Qahtani, who is also chairman of the Saudi Gulf Airlines board of directors, said the two sides discussed ways to support air freight and maritime transport between the two states, “to enhance logistics services and facilitate import and export operations, especially facilitating the Saudi exports to Russia,” since there is no direct shipping route between the two countries.

Saudi-Russian relations have been developing considerably, especially economically, which has contributed to enhancing bilateral trade and investment cooperation, which reached SR5.5 billion ($1.47 billion) in 2018, a growth of 43 percent compared to the previous year.

Saudi exports to Russia represent just 2.5 percent of the volume of trade between the two countries. However, Al-Qahtani noted that the volume of Saudi-Russian trade did not fully reflect the importance of the economic links between the two countries, adding that “Saudi products are highly competitive and have penetrated more than 140 markets around the world.”

Al-Qahtani stressed the council aims to increase the volume of bilateral trade to a more satisfactory figure for both sides.

FASTFACTS

• Bilateral trade and investment between the two countries reached $1.47 billion in 2018.

• The Council of Saudi Chambers submitted a proposal to open a Russian bank in Riyadh.

• Using Russian and Saudi currencies in transactions also under study.

He said that one of the most promising sectors that both sides will work on through the SRBC is holding exhibitions of Saudi and Russian produce and introducing commodities from both countries.

He pointed out that the Kingdom boasts many efficient Saudi companies across various fields, adding that the Saudi business community looks “forward to more discussions and cooperation with Russian businessmen in a way that benefits both parties.”

The Council of Saudi Chambers submitted a proposal to open a Russian bank in Riyadh in a step aimed at facilitating commercial and economic trade between the two countries, a move which was supported by Russian diplomats.

Ajlan Al-Ajlan, chairman of the Saudi Chambers of Commerce, added that this would be a big step forward in developing further commercial and economic relations between the two countries.

Russian Ambassador Sergey G. Kozlov said his country views the development of trade relations between the two nations as an essential step forward.

In a statement that coincided with the recent meeting of the council, Kozlov noted that King Salman’s “historic” visit to Russia and the visit of Russian President Vladimir Putin to Riyadh paved the way for a strong and strategic partnership.

He said that the appointment of a commercial attaché at the Russian Embassy in Riyadh is a new step in overcoming all economic obstacles facing Saudi businessmen.

The council stressed the need to lay down a roadmap for developing economic cooperation between the two states, focusing on developing trade and investment agreements, opening direct flights, facilitating the issuance of visas and increasing cooperation in targeted sectors, including the agricultural sector.


Saudi Arabia’s top banks see profits increase by 34% in first quarter of 2021

Saudi Arabia’s top banks see profits increase by 34% in first quarter of 2021
Updated 20 June 2021

Saudi Arabia’s top banks see profits increase by 34% in first quarter of 2021

Saudi Arabia’s top banks see profits increase by 34% in first quarter of 2021
  • The banks included in the study were Saudi National Bank, Al-Rajhi Bank, Riyad Bank, Saudi British Bank, Banque Saudi Fransi, Arab National Bank, Alinma Bank, Bank Al-Bilad, Saudi Investment Bank, and Bank Al-Jazira

JEDDAH: The accumulated income of the Top-10 banks in Saudi Arabia increased by 34.1 percent during the first quarter of 2021, compared to the previous quarter, according to a report by professional services firm Alvarez and Marsal (A&M).

A&M’s Banking Pulse for Saudi Arabia said lenders in the Kingdom “have rebounded to deliver blockbuster first quarter profit,” mainly due to improving macroeconomic conditions, the country’s buoyant capital market, and a significant decrease in impairments.

The banks included in the study were Saudi National Bank, Al-Rajhi Bank, Riyad Bank, Saudi British Bank, Banque Saudi Fransi, Arab National Bank, Alinma Bank, Bank Al-Bilad, Saudi Investment Bank, and Bank Al-Jazira.

“Looking ahead, credit growth is likely to be driven by continuous strength in mortgage lending and a pickup in corporate credit demand in the second half of 2021, as the economic activity continues to improve,” said Asad Ahmed, A&M managing director and head of Middle East financial services. “Corporate lending is expected to gain traction as the Public Investment Fund plans to invest $40 billion into the economy annually until 2025, to support business activity.”

Ahmed said that following the merger of Saudi banking titans National Commercial Bank and Samba to form Saudi National Bank, other lenders in the Kingdom would also look to consolidate their position and improve their capital base.

Loans and advances increased by 5 percent in the first quarter while deposit growth slowed to 2.2 percent in the same period. The lending picked up on the back of mortgage financing in the retail sector driven by government initiatives to increase homeownership, A&M said.

The cost of risk across all the banks fell to its lowest level in the last five quarters from 1.3 percent in the fourth quarter of last year to 0.6 percent in the first quarter of this year.

Total impairments fell by half as the banks saw a reversal of some bad loans that had previously been set aside during the pandemic.


Britain under pressure to ease travel rules

Britain under pressure to ease travel rules
Updated 20 June 2021

Britain under pressure to ease travel rules

Britain under pressure to ease travel rules
  • On June 23, pilots, cabin crew and travel agents will gather in Westminster, central London

LONDON: Britain’s airlines and holiday companies are planning a “day of action” on Wednesday to ramp up pressure on the government to ease travel restrictions, with just weeks to go before the start of the peak summer season.

Travel companies, whose finances have been stretched to breaking point during the coronavirus pandemic, are desperate to avoid another summer lost to COVID-19. But with Britain’s strict quarantine requirements still in place that now looks likely.

As the clock ticks down to July, Europe’s biggest airline Ryanair and Manchester Airports Group on Thursday launched legal action to try to get the government to ease the rules before the industry’s most profitable season starts.

On June 23, pilots, cabin crew and travel agents will gather in Westminster, central London, and at airports across Britain to try to drum up support.

Britain’s aviation industry has been harder hit by the pandemic than its European peers, according to data published by pilots trade union BALPA on Sunday.

The data showed daily arrivals and departures into the UK were down 73 percent, the biggest drop in Europe. Spain, Greece and France were down less than 60 percent.

UK airports were also badly affected, with traffic in and out of London’s second busiest airport Gatwick down 92 percent, according to the data.

The government had to balance the risks of foreign holidays bringing new variants of the virus into Britain, justice minister Robert Buckland told the BBC.

Public Health England official Susan Hopkins said people should predominantly holiday at home this summer while the population is vaccinated.

But time is running out for the industry, said the union.

“There is no time to hide behind task forces and reviews,” said BALPA General Secretary Brian Strutton.

“BALPA is demanding that the UK government gets its act together and opens the US routes and European holiday travel destinations that it has blocked with no published evidence at all.”

Over 45,000 jobs have already been lost in UK aviation, with estimates suggesting that 860,000 aviation, travel and tourism jobs are being sustained only by government furlough schemes.


Egypt to launch Downtown Towers project

Egypt to launch Downtown Towers project
The project is being implemented by the China State Construction Engineering Corporation (REUTERS)
Updated 20 June 2021

Egypt to launch Downtown Towers project

Egypt to launch Downtown Towers project
  • The minister explained that eight towers were being constructed in the second phase in the coastal area, and currently the construction of some towers had reached the seventh floor

CAIRO: Egyptian Minister of Housing, Utilities and Urban Communities Assem El-Gazzar has laid the foundation stone for the Downtown Towers project in New Alamein city in northwest Egypt.

The project is being implemented by the China State Construction Engineering Corporation (CSCEC).

El-Gazzar said in a statement that the Downtown Towers were being constructed similarly to those of the Central Business District of the new administrative capital, and with self-financing from the New Urban Communities Authority.

El-Gazzar explained that the project included the construction of five residential towers with full services. The towers overlook an artificial lake and include the Iconic Tower with a height of 250 meters, 68 floors and a total area of ​​465,000 square meters, which is scheduled to be implemented within 45 months.

He outlined the construction of four towers with a height of 200 meters each, with a total area of ​​320,000 square meters, scheduled to be implemented within 39 months.

The minister explained that eight towers were being constructed in the second phase in the coastal area, and currently the construction of some towers had reached the seventh floor.

“Today we celebrate and document an important event in the history of the modern Egyptian urban renaissance, which is laying the foundation stone for the Downtown Towers project in the New Alamein city,” he said.

“On Thursday we celebrated and documented the completion of the concrete structure works for the tallest tower in Africa in the Central Business District of the New Administrative Capital.”

The minister said that ​​New Alamein was not a summer city but rather a city for housing, residence and work (in agriculture, industry, tourism, entertainment and services), and was primarily a regional center for the northern coast.

He said that the Downtown Towers project would create a development area in New Alamein comparable to the Central Business District of the New Administrative Capital.

“We will continue to work and build our country and provide Egyptians with the urban product, which is in line with the modern Egyptian urban renaissance in the era of President Abdel Fattah El-Sisi,” he said.