Europe must wean itself off global payment card schemes, ECB says

Europe must wean itself off global payment card schemes, ECB says
The international payment sector is dominated by US providers such as Visa and MasterCard. (Reuters)
Updated 26 November 2019

Europe must wean itself off global payment card schemes, ECB says

Europe must wean itself off global payment card schemes, ECB says
  • The ECB is now studying the option of introducing a digital currency, but this would have broader consequences for the banks

BRUSSELS: A European Central Bank board member has said Europe must overcome its reliance on international payment providers - but that it is not the central bank's job to come to the rescue and crowd out private sector initiatives.
More than two-thirds of non-cash payments are made with overseas cards as most competing European providers tend to be focused domestically or regionally, Benoit Coeure told a conference on Tuesday. He said this put the euro zone at a competitive disadvantage.
"Europe is at risk of losing its economic edge," Coeure said. "Country-specific solutions lack the necessary size and scale, and national fragmentation has paralysed competition and stifled innovation on the pan-European level."
The sector is dominated by US providers such as Visa Inc and MasterCard Inc. Amazon.com Inc. and Apple Inc. have also taken market share with their respective payment schemes, as has the online provider PayPal Holdings Inc. - all also based in the US
The ECB is now studying the option of introducing a digital currency, but this would have broader consequences for the banks. Coeure warned against the central bank crowding out private-sector players.
The ECB recently introduced an instant payment system called TIPS for transactions between banks, but lenders have been slow to join and the scheme has not had a significant impact so far.
Speaking at the same event, European Commission Vice President Valdis Dombrovskis said his aim was to roll out a pan-European instant payment to all parts of the bloc by the end of 2021.
"By that time, everyone in the EU, people and companies, should be able to carry out domestic and cross border instant payment transactions in all payment situations," he said. "EU banks must become fully available for providing and receiving instant payments across the EU."
Relying on non-European payment providers is problematic, Coeure added, because the bloc lacks authority over them and has limited oversight powers.
New digital currency initiatives that seek to fill this void, such as "stablecoins", may also be problematic because they are untested and create legal uncertainty.


Suspected cases of corporate collusion in Saudi Arabia surge in 2021

Suspected cases of corporate collusion in Saudi Arabia surge in 2021
Updated 3 min 25 sec ago

Suspected cases of corporate collusion in Saudi Arabia surge in 2021

Suspected cases of corporate collusion in Saudi Arabia surge in 2021
  • Cases investigated rises to 86 in 2021 from 55 in 2020
  • Value of cases more than SR1 billion

RIYADH: Cases of suspected collusion in tenders being investigated by the Saudi General Authority for Competition (GAC) rose to 86 in 2021, up from 55 last year and 15 in 2019, Al Arabiya reported.

The value of projects being investigated in the Kingdom amounted to more than SR1 billion ($267 million), Abdulaziz Alzoom, governor of GAC, said in a statement.

In a previous statement, GAC said it had started investigations, research and gathering of evidence with a number of establishments, based on communications it had received from other authorities, and complaints from individuals and companies.


Oil prices rise further on tight supply outlook, eyes on OPEC+

Oil prices rise further on tight supply outlook, eyes on OPEC+
Updated 37 min 24 sec ago

Oil prices rise further on tight supply outlook, eyes on OPEC+

Oil prices rise further on tight supply outlook, eyes on OPEC+
  • U.S. infrastructure bill brightens demand outlook - analysts
  • OPEC+ meeting on July 1, seen cautious with easing output cuts

SINGAPORE: Oil prices climbed for a third straight session on Friday, on track for a fifth consecutive weekly gain, as demand growth is expected to outstrip supply on bets that OPEC+ producers will be cautious in returning more output to the market from August.
Brent crude futures rose 6 cents, or 0.1 percent, to $75.62 a barrel at 6:46 a.m. GMT, heading for a 2.9 percent jump for the week.
US West Texas Intermediate (WTI) crude futures were up 5 cents, or 0.1 percent, at $73.35 a barrel, headed for a 2.4 percent weekly gain.
Both benchmark contracts settled at their highest levels since October 2018 on Thursday.
“Expectations of tightness in global market is the major factor supporting crude oil as demand is recovering while OPEC+ has constrained supply and US stocks are falling,” said Ravindra Rao, vice president for commodities at Kotak Securities.
Oil also got some support on Friday as the approval of US infrastructure bill boosted optimism for energy demand outlook, analysts said.
All eyes are on the Organization of the Petroleum Exporting Countries, Russia and allies — together called OPEC+ — who are due to meet on July 1 to discuss further easing of their output cuts from August.
“(The market) certainly has momentum behind it...It’s really in the hands of OPEC+,” said Commonwealth Bank commodities analyst Vivek Dhar.
On the demand side, the key factors OPEC+ will have to consider are strong growth in the United States, Europe and China, bolstered by vaccine rollouts and economies reopening, offset by rising COVID-19 cases and outbreaks in other locations, analysts said.
“I think OPEC+ will carefully calibrate production hikes from August onwards to meet rising demand without causing significant price fluctuations,” said Margaret Yang, a strategist at Singapore-based DailyFX.
“The market has likely priced-in an August hike in advance,” she added.
ANZ analysts have predicted OPEC+ would step up supply with a small increase of 500,000 barrels per day in August, adding to the 2.1 million bpd they agreed to return to the market from May through July.
The prospect of sanctions being lifted on Iran and more of its oil hitting the market anytime soon has dimmed, with a US official saying “serious differences” remain over a range of issues over Iran’s compliance with the 2015 nuclear deal.


Iraq, UAE’s Masdar sign solar power agreement

Iraq, UAE’s Masdar sign solar power agreement
Updated 53 min 13 sec ago

Iraq, UAE’s Masdar sign solar power agreement

Iraq, UAE’s Masdar sign solar power agreement
  • 2,000 MW of solar to be built according to agreement
  • Cost of deal undisclosed by Iraqi Oil Ministry

DUBAI: The Iraqi electricity ministry signed with Masdar, a United Arab Emirates-based renewable power developer, an agreement to build solar power projects in central and southern Iraq, with a total capacity of 2,000 Megawatts, the Iraqi oil ministry said on Thursday in a statement.
The project is the biggest investment in Iraq’s renewable energy industry, the statement said, without indicating its total cost.
Iraq is planning to build a number of power plants in the coming years in partnership with international and Arab companies. Some will use solar energy, while others will run on fossil fuels, including gas that is produced during the extraction of oil, by introducing it into the electricity production system, Iraq Oil Minister Ihsan Abdul Jabbar told Asharq recently.


Lebanon caretaker PM approves financing fuel imports at weaker exchange rate

Lebanon caretaker PM approves financing fuel imports at weaker exchange rate
Updated 25 June 2021

Lebanon caretaker PM approves financing fuel imports at weaker exchange rate

Lebanon caretaker PM approves financing fuel imports at weaker exchange rate
  • Lebanon is in the throes of a financial crisis described by the World Bank as one of the deepest depressions of modern history
  • Lebanon’s central bank asked the government on Thursday to provide it with a legal basis to lend it foreign currency from its mandatory reserves to fund the subsidised fuel imports

BEIRUT: Lebanon’s caretaker prime minister on Friday approved a proposal to finance fuel imports at the rate of 3,900 Lebanese pounds to the dollar, instead of the previous 1,500 pound rate, amidst worsening gasoline shortages.
The weaker exchange rate, which will effectively decrease the subsidy on fuel, is expected to raise the price of gasoline for consumers but enable the government to supply fuel for a longer period of time.
Lebanon is in the throes of a financial crisis described by the World Bank as one of the deepest depressions of modern history. Fuel shortages in past weeks have forced motorists to queue for hours for dribbles of gasoline.
Lebanon’s subsidy program, introduced last year as the country’s economic meltdown translated to harsher living conditions, covers basic goods such as wheat, medicine and fuel and costs around $6 billion a year.
Half of that amount is spent on fuel.
Lebanon’s central bank asked the government on Thursday to provide it with a legal basis to lend it foreign currency from its mandatory reserves to fund the subsidised fuel imports, an indication that the bank has all but run out of reserves.
Mandatory reserves — hard currency deposits parked by local lenders at the central bank — represent a percentage of customer deposits and are usually not drawn upon except in exceptional circumstances, with the correct legal permission.
Lebanon’s foreign currency reserves stood at slightly more than $15 billion in March. The Central Bank has not given an updated figure since then. 


Iraq targets 90% self-sufficiency in natural gas by 2025

Iraq targets 90% self-sufficiency in natural gas by 2025
Updated 25 June 2021

Iraq targets 90% self-sufficiency in natural gas by 2025

Iraq targets 90% self-sufficiency in natural gas by 2025
  • Iraq currently consumers 3,5000 cubic feet of gas, produces 1,300 cubic feet
  • Iraq imports the rest of its gas from Iran

RIYADH: The Iraqi Ministry of Oil plans to attract a contractor to invest in Akkas gas field, to produce 4,000 million cubic feet of gas by 2025, which represents 90 percent of Iraq’s need for electric power production, said Minister Ihsan Abdul Jabbar.

Iraq will need more gas for electric power by 2030 to keep pace with the rise in the population, which is expected to increase by 10 million people to 50 million by then, he told Asharq.

Iraq will still need to import 15 percent of the gas fuel it needs, he said. Infrastructure is being built in the south to open new outlets to import gas from other countries such as Qatar when needed, he said.

There are currently new projects in the governorates of Dhi Qar and Maysan, Abdul Jabbar said.

Iraq currently consumes about 3,500 million standard cubic feet of natural gas, of which 1,300 cubic feet is produced in Iraq and the rest imported from Iran, while the actual need for Iraq amounts to 4,500 million cubic feet, he said.

Iraq is planning to build a number of power plants in the coming years in partnership with international and Arab companies. Some will use solar energy, while others will run on fossil fuels, including gas that is produced during the extraction of oil, by introducing it into the electricity production system, Abdul Jabbar said.

Iraq plans to end gas flaring altogether by 2025, he said.