Virtual Facebook currency faces real-world resistance

Virtual Facebook currency faces real-world resistance
Facebook unveiled on June 18, 2019 its global crypto-currency "Libra," in a new initiative in payments for the world's biggest social network with the potential to bring crypto-money out of the shadows and into the mainstream. (AFP / JUSTIN SULLIVAN)
Updated 21 June 2019

Virtual Facebook currency faces real-world resistance

Virtual Facebook currency faces real-world resistance
  • In India, "Libra” currency will have to overcome regulatory mistrust and popular homegrown rivals 
  • China and Iran markets are out, and winning over governments in other countries also a big challenge

LONDON: If Facebook’s new cryptocurrency should resonate anywhere it should be India, where the social media giant has more than 300 million followers.
Many Indians are shut out of banking and face punitive fees for simple transactions, like transferring money to their loved ones.
But in India as elsewhere, the US company’s ambitions to remake global finance through its “Libra” currency will have to overcome regulatory mistrust, plus the existence of popular homegrown rivals in the market for digital payments.
“If regulations were not a hurdle in India, Libra would instantaneously have a massive reach because of Facebook,” Anirudh Rastogi, the founder of a technology-focused law firm in New Delhi, told AFP.
When it launches next year, Libra will be backed by a basket of real-world currencies and a consortium of companies. To mint and store new coins, access to its underlying “blockchain” technology will be more restrictive than for the free-for-all of bitcoin.
Companies rooted in traditional finance such as Visa and MasterCard have joined from the start, betting that Facebook’s clout gives the project enough potential to overcome any downside to their existing business models.
“I will definitely use Libra as the idea seems good and they have a big partnership list thereby offering credibility,” 23-year-old consultant Prasad Khake said in Mumbai.
“The platform will work depending on how accessible and easy it is for billions of Indian users,” he said.
Therein lies the problem. Cryptocurrencies are currently banned in India, and the country’s central bank, which calls them a “contagion,” is taking its time to craft a regulatory framework.

<b>Banned in China</b>
Facebook itself is banned outright in China, and the company admitted it would be unable to operate Libra anywhere that is subject to US sanctions, such as Iran.
There is suspicion too on its home turf, with US lawmakers highlighting Facebook’s poor record in safeguarding user data. The Senate banking committee has scheduled a hearing for July 16.
French Finance Minister Bruno Le Maire said digital money could never replace sovereign currencies. Bank of England governor Mark Carney said Libra would have to withstand the toughest scrutiny and not become a tool for money laundering or terrorist financing.
There is clearly potential if Facebook makes good on its pledge to bring low-cost or free banking to the unbanked and open up areas such as money transfers, where the company — citing UN data — says migrants lose $25 billion every year in remittance fees.
For their part, money transfer businesses say they welcome the challenge.
“It may help with educating regulators, could evolve the payments ecosystem faster and eventually lower the cost of moving money, making the conversations on the issues we’re tackling more mainstream,” TransferWise chief technology officer Harsh Sinha told AFP in London.
To access Libra on their smartphones, users will go through a virtual wallet called Calibra. There are plenty of such e-wallets already, however.
Paytm and FreeCharge are popular in India. Facebook’s own WhatsApp has been trialling a digital payments service in India, but has faced resistance from the central bank.

<b>'Regulate, don't ban'</b>
The Philippines could be another fertile market, with Filipinos working overseas sending tens of billions of dollars every year through money transfer outlets. But often in the Middle East and the rest of Asia they are kept on a tight rein by employers and lack access to the Internet.
“They (overseas workers) barely embraced online banking so cryptocurrency may even be a stretch unless the demographics goes to an upswing with tech-savvy millennials,” said Victoriano Gimenez, an electrical engineer who worked for six years in Saudi Arabia.
Another popular platform in India is M-Pesa, which started life in east Africa and has helped millions in Kenya, Zimbabwe and elsewhere move beyond cash and traditional banking.
Winning over the foreign public to the idea of Western-backed crypto payments is one thing. Winning over their governments is another, and could be the biggest challenge to global adoption of Libra.
“Regulators around the world have really now to wake up and actually say ‘well, what do we do about regulating this?’ and not just banning this, because it won’t be going away,” Iqbal Gandham, managing director of eToro in Britain and chairman of the industry group CryptoUK, told AFP.
But even if regulators don’t see a threat to their sovereign currencies, they will still be exercised by exchange rate risk, liquidity in times of financial crisis, and the impact on corporate competition, according to ING economists Teunis Brosens and Carlo Cocuzzo.
“While a lot remains unclear at this stage, Facebook has clearly started a new chapter on digital currencies,” they wrote in a research note. “Over to policymakers for a response.”


Saudi Arabia to auction mining licenses in 2022

Saudi Arabia to auction mining licenses in 2022
Updated 18 June 2021

Saudi Arabia to auction mining licenses in 2022

Saudi Arabia to auction mining licenses in 2022

RIYADH: Saudi Arabia plans to auction two major mining licenses in 2022 for commodities including gold, copper and zinc, as the Kingdom aims to triple the mining
sector’s contribution to the national gross domestic product (GDP) to SR240 billion ($64 billion) and double the number of jobs to 470,000 by 2030.
The auction was announced by Vice Minister for Saudi Mining Affairs Khalid Al-Mudaifer during an interview with S&P Global on the sidelines of the Gulf Petrochemicals and Chemicals Association (GPCA) Leaders Forum in Dubai this week.
Looking ahead, Al-Mudaifer said: “We expect to see an increase in international investment in mining, particularly because demand for minerals around the world is growing fast.
According to geological surveys dating back 80 years, the Kingdom has an estimated reserve of untapped mining potential valued at $1.3 trillion.” Saudi Arabia’s mining industry has already attracted some major foreign investors. American industrial corporation Alcoa has a 25.1 percent stake in two companies, Ma’aden Bauxite and Alumina and Ma’aden Aluminum, as part of $10.8 billion joint venture with the Saudi Arabian Mining Company (Ma’aden) located in Ras al-Khair Industrial City in the Eastern Province.
The Mosaic Company, a fertilizer producer, has a 25 percent stake in the $8 billion Ma’aden Wa’ad Al-Shamal Fertilizer Production Complex located in Wa’ad Al Shamal Minerals Industrial City in the north of Saudi Arabia. Furthermore, Barrick Gold has a 50 percent stake with Ma’aden in the Jabal Sayid underground Copper Mine and Plant.
Al-Mudaifer said that a new mining law, which came into force on Jan. 1, 2021, will help attract more foreign investors because it treats them equally with local investors.
“We have already received a number of applications for exploration licenses from locals and are also in conversations with a number of international mining businesses,” he said.
Speaking at the GPCA forum, Al-Mudaifer described how the Kingdom’s mining sector remained resilient throughout the pandemic.
“The government’s robust response to controlling the pandemic, paired with our thoughtful approach to executing the country’s mining strategy, has enabled us to continue moving forward with our industry transformation,” said Al-Mudaifer.
He also highlighted the launch of the National Geological Database, which provides online access to 80 years of national records of geological, geophysical and geochemical information, and the introduction of a new web-based platform called Ta’adin, which will be the single point of access for mining license applications, issuance and information.
Saudi Arabia plans to launch a comprehensive geological survey to map the country’s mining potential. “The mining sector recently invested $500,000 to launch our Regional Geological Survey Program, designed to collect the essential data required for mineral exploration in the Kingdom,” Al-Mudaifer told S&P Global.
“The five-year program will conduct geophysical and geo-chemical surveys and create detailed mapping of more than 700,000 square kilometers of the mineral-rich Arabian Shield area in Saudi Arabia,” he said.
The Vision 2030 reform plan identified the mining sector as a potential third pillar of the Kingdom’s industrial growth, alongside petroleum and petrochemicals. The country is investing SR14 billion to develop the sector.
“We have emerged more confident than ever that mining in the Kingdom is on the fast track to becoming the third pillar of Saudi industry.” the vice minister said.
About $45 billion in private and public sector investments have gone into the mining sector over the past decade, mainly in phosphate and aluminum production.
“Saudi Arabia has some of the world’s largest reserves of phosphate, and so we are investing in major phosphate projects such as Ma’aden’s large-scale phosphate complex, Phosphate 3,” Al-Mudaifer said.
The $6.4 billion Phosphate 3 expansion will make Ma’aden one of the top three global phosphate fertilizer producers and Saudi Arabia the second largest phosphate fertilizer exporter worldwide.


Egypt to start electric car production from mid-2022

Egypt to start electric car production from mid-2022
Updated 18 June 2021

Egypt to start electric car production from mid-2022

Egypt to start electric car production from mid-2022
  • Thirteen electric vehicles will be tested on Egyptian streets from next month

CAIRO: Egypt will begin testing electric cars on the country’s streets from July, ahead of plans to launch full-scale production of the vehicles from mid-2022.

Thirteen imported electric vehicles will be tested on Egyptian streets from next month, Hisham Tawfik, minister of the Egyptian public enterprise sector, said while attending the launch of the Nasr E70 electric car.

Nine of the electric cars will be tested by drivers nominated by Uber, the global ride-hailing company, he added.

The Nasr E70 is scheduled to start production in mid-2022 with the El Nasr Automotive Manufacturing Company, an affiliate of the Ministry of Public Enterprise Sector’s Metallurgical Industries Company.

Tawfik said that the ministry began studying the electric car production project in mid-2019 as part of efforts to reform and develop its affiliated companies, including the revival of El Nasr Automotive Company.

FASTFACT

E70

The Nasr E70 is scheduled to start production in mid-2022 with the El Nasr Automotive Manufacturing Company.

The project is in line with the global move toward electric cars and aligns with President Abdel Fattah El-Sisi’s directives to localize the manufacture of vehicles used for clean energy.

The Dongfeng Corporation, one of the largest automobile producers in China, is partnering in the production of the Nasr E70 vehicle, the minister said.

An agreement between El-Nasr and Dongfeng was signed in June 2020 following months of negotiations.

The Ministry of Public Enterprise Sector recently released images of the first electric car of its kind in the country.

El Nasr CEO Hani El-Khouly said that three types of electric car models will be available in Egypt, based on battery capacity.

Batteries initially will be made in China, with production later shifting to Egypt.

Trials of the imported cars will continue for up to four months under a range of Egyptian conditions and with different drivers.

The Nasr E70 can reach a speed of 145 kilometers per hour and travel up to 400 km on a single charge.

El-Khouly said that a delegation from China will arrive in Egypt in July to follow up on the tests.

Government subsidy of the car will total about EGP50,000 ($13,333) to support the local market, he said.


From Australia to Hong Kong, internet outages disrupt services

From Australia to Hong Kong, internet outages disrupt services
Updated 18 June 2021

From Australia to Hong Kong, internet outages disrupt services

From Australia to Hong Kong, internet outages disrupt services
  • Many of the outages were reported by people in Australia trying to do banking, book flights and access postal services.
  • Brief internet service outages are not uncommon and are only rarely the result of hacking or other mischief

SYDNEY: A wave of brief Iinternet outages hit the websites and apps of dozens of financial institutions, airlines and other companies across the globe Thursday.

The Hong Kong Stock Exchange said in a post on Twitter Thursday afternoon Hong Kong time that its site was facing technical issues and that it was investigating. It said in another post 17 minutes later that its websites were back to normal.

Internet monitoring websites including ThousandEyes, Downdetector.com and fing.com showed dozens of disruptions, including to US-based airlines.

Many of the outages were reported by people in Australia trying to do banking, book flights and access postal services.

Australia Post, the country’s postal service, said on Twitter that an “external outage” had impacted a number of its services, and that while most services had come back online, they are continuing to monitor and investigate.

Many services were up and running after an hour or so but the affected companies said they were working overtime to prevent further problems.

Banking services were severely disrupted, with Westpac, the Commonwealth, ANZ and St. George all down, along with the website of the Reserve Bank of Australia. Services have mostly been restored.

Virgin Australia said flights were largely operating as scheduled after it restored access to its website and guest contact center.

“Virgin Australia was one of many organizations to experience an outage with the Akamai content delivery system today,” it said. “We are working with them to ensure that necessary measures are taken to prevent these outages from reoccurring.”

Akamai counts some of the world’s biggest companies and banks as customers.

Calls to Akamai, which is headquartered in Cambridge, Massachusetts, but has global services, went unanswered.

The disruptions came just days after many of the world’s top websites went offline briefly due to a problem with software at Fastly, another major web services company. The company blamed the problem on a software bug that was triggered when a customer changed a setting.

Brief internet service outages are not uncommon and are only rarely the result of hacking or other mischief. But the outages have underscored how vital a small number of behind-the-scenes companies have become to running the internet.


Saudi and Russian business officials propose Russian bank in Riyadh

Saudi and Russian business officials propose Russian bank in Riyadh
Updated 18 June 2021

Saudi and Russian business officials propose Russian bank in Riyadh

Saudi and Russian business officials propose Russian bank in Riyadh
  • Russian ambassador to the Kingdom says new commercial attache at the embassy will help Saudi businesses

RIYADH: A proposal to open a Russian bank in Riyadh was presented at a meeting between Saudi and Russian officials on Thursday.
The move would facilitate trade and economic exchange between the two countries, a meeting of the Saudi-Russian Business Council of the Council of Saudi Chambers (CSC) was told.
Russia’s Ambassador to the Kingdom, Sergei Kozlov, said he promised to support and study the proposal to open the bank in Riyadh.
He said a commercial attaché had been appointed at the embassy in Riyadh to help Saudi business owners overcome obstacles.
Ajlan bin Abdulaziz Al-Ajlan, president of the CSC, said the meeting provided strong impetus toward developing more trade and economic relations.
Chairman of the Saudi-Russian Business Council Tariq Al-Kahtani said it was important to strengthen economic and trade cooperation.
The meeting also dealt with some challenges that contributed to the weak volume of trade exchange between the Kingdom and Russia, including the lack of a direct shipping line to facilitate import and export operations.


International companies to invest in Egyptian green hydrogen projects, says minister

International companies to invest in Egyptian green hydrogen projects, says minister
Updated 17 June 2021

International companies to invest in Egyptian green hydrogen projects, says minister

International companies to invest in Egyptian green hydrogen projects, says minister
  • Egypt has signed MOU for 1GW green hydrogen project
  • Other EU companies set to partner with Egypt's private sector

RIYADH: International companies are interested in investing in green hydrogen production in Egypt, according to Minister of Electricity and Renewable Energy Mohamed Shaker.

“There are companies from the European Union that will enter into partnerships with the Egyptian private sector,” he said.

The Egyptian government has signed an MoU with Siemens for the first project to produce green hydrogen with a capacity of 1 megawatt, doubling to 2 megawatts over five years, he said.

“Green hydrogen will be the world’s fuel in the next few years, and I see that Egypt started early in this field,” he added.

Work is currently underway to develop and formulate a strategy for the hydrogen industry in Egypt through a ministerial committee in which the Ministry of Petroleum and Mineral Resources participates as a main member, according to previous statements by the Minister of Petroleum and Mineral Resources Tarek El Molla.

Egypt is planning to invest up to $4 billion in a project to generate green hydrogen gas through water electrolysis, Shaker said this week.

The project is currently in the feasibility studies stage, in consultation with the Sovereign Fund of Egypt and a group of concerned ministries, and will be presented next week, he said.

The United States is planning to increase funding to Egypt to help it convert to solar energy and move away from fossil fuels, US special envoy for climate John Kerry said in Cairo on Wednesday.

Egypt is planning to double the state’s funding for green projects to 30 percent of its overall investment plan during the fiscal year 2021/2022 and to raise it to 50 percent by 2024/2025.