African trade deal could lift millions out of poverty

African trade deal could lift millions out of poverty
Mine workers wearing face masks looks on at the end of their shift, amid a nationwide coronavirus disease (COVID-19) lockdown, at a mine of Sibanye-Stillwater company in Carletonville, South Africa. (Reuters)
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Updated 28 July 2020

African trade deal could lift millions out of poverty

African trade deal could lift millions out of poverty
  • Once in force, the AfCFTA will bring together 1.3 billion people across 55 countries with combined GDP of $3.4 trillion

JOHANNESBURG: A pandemic-delayed African free trade deal, if fully implemented, could boost incomes across the continent, pull millions out of poverty and cushion against the negative fallout from COVID-19, the World Bank wrote in a report on Monday.

The African Continental Free Trade Area (AfCFTA) was due to come into force on July 1, but that proved unworkable after the virus forced widespread border closures and halted talks between governments over the removal of tariffs.

It may now begin operating from the start of 2021.

The pandemic is expected to cost Africa up to $79 billion in lost economic output this year alone with the additional risk of millions of job losses.

“In this context, a successful implementation of AfCFTA would be crucial,” the report said. “(It) is a major opportunity for Africa, but implementation will be a significant challenge. Lowering tariffs is only the first step.”

Once in force, the AfCFTA will bring together 1.3 billion people across 55 countries with combined GDP of $3.4 trillion.

World Bank researchers estimated the trade deal would lift 30 million Africans out of extreme poverty and 68 million from moderate poverty by 2035.

Full implementation could increase real income in Africa by 7 percent, or nearly $450 billion, mainly by reducing the cost of trade through the elimination of tariffs and red tape.

Ivory Coast and Zimbabwe — countries with the highest costs of trade — could see income gains of 14 percent.

The volume of total exports would increase by almost 29 percent, according to the World Bank, with exports between African nations rising 81 percent. 

Exports to non-African countries would increase 19 percent.

“The report estimates that compared with a business-as-usual scenario, implementing AfCFTA would lead to an almost 10 percent increase in wages, with larger gains for unskilled workers and women,” the report said.


Pandemic to stall UAE banks’ recovery in early 2021: A&M report

Pandemic to stall UAE banks’ recovery in early 2021: A&M report
Updated 10 min 11 sec ago

Pandemic to stall UAE banks’ recovery in early 2021: A&M report

Pandemic to stall UAE banks’ recovery in early 2021: A&M report
DUBAI: The pandemic will continue to affect profitability for banks in the United Arabia Emirates (UAE) in the early quarters of 2021, after a sharp drop in return on equity last year, consulting firm Alvarez & Marsal (A&M) said on Tuesday.
Return on equity fell to 7.7 percent in 2020 from 13.3 percent the previous year, A&M said in a report on the UAE’s top 10 banks.
“We possibly have not turned the corner,” Asad Ahmed, head of Middle East financial services for A&M told a briefing, saying this goes for banks globally as well as in the UAE.
“In terms of the region and the UAE, 2021 will continue to be a year which does not produce stellar results, but hopefully next year onwards we will see the numbers turn around.”
Growth in loans and advances during 2020 slowed sharply to 1.4 percent from 13.2 percent in 2019, the report said.
2021 is expected to be less volatile than the past year, but banks might see a deterioration in their asset quality after the completion of the central bank’s stimulus scheme later this year, it said.
Total loan-loss provisions jumped 79 percent year-on-year to 28.1 billion dirhams ($7.65 billion) for the top 10 UAE banks last year, as a challenging economic environment and banks’ exposure to several high-profile cases boosted impairments, A&M said.
UAE banks have been hurt by their exposure to hospital operator NMC Health, which disclosed more than $4 billion in hidden debt after short-seller Muddy Waters questioned its financial reporting.
The hospital operator filed for administration in London in April last year.

Vodafone towers unit set for 14.7-bn euro valuation

Vodafone towers unit set for 14.7-bn euro valuation
Updated 6 min 17 sec ago

Vodafone towers unit set for 14.7-bn euro valuation

Vodafone towers unit set for 14.7-bn euro valuation

LONDON: British mobile phone giant Vodafone on Tuesday announced the price range for the upcoming German stock market flotation of its towers business, valuing the unit at up to 14.7 billion euros ($17.4 billion).
The float of up to one-quarter of Vantage Towers comes amid increasing demand for mobile telecommunications connectivity across Europe, driven by data growth, 5G roll-out and regulatory coverage obligations.
Mobile phone giants are also floating or selling off their tower businesses in order to slash debt.
German-headquartered Vantage Tower will have its first day of trading on the Frankfurt stock market on or around March 18, with a price-per-share range of between 22.5 euros and 29 euros, Vodafone said in a statement.
The initial public offering (IPO) “implies a total market capitalization for Vantage Towers of 11.4 billion euros to 14.7 billion euros,” it added.
Digital Colony, a digital infrastructure investor and operator based in the US, has agreed to be a cornerstone investor in the IPO, alongside RRJ, a global equity fund based in Singapore, with commitments of 500 million euros and 450 million euros, respectively.
“The Vantage Towers IPO is moving ahead at pace,” Vantage chief executive Vivek Badrinath said in the statement.
“Today’s price range announcement is accompanied by the news that two leading global investors have committed to cornerstone our IPO with the purchase of 950 million euros of shares at the offer price.”
Vantage Towers’ portfolio includes 82,000 macro sites — towers, masts and rooftops — across 10 European countries.
“Demand for data and connectivity across Europe is powering growth in the towers sector,” Badrinath said.
“Our superior grid and leading market positions mean we are well placed to benefit from this growth and our recent financial results highlighted the good commercial and operational momentum across the business,” he added.
Vodafone said it was targetting proceeds of up to 2.8 billion euros from the IPO, helping to reduce its debt pile.
Earlier this year, heavily-indebted Telefonica agreed to sell its telephone masts in Europe and Latin America to US-based telecom infrastructure firm American Towers for 7.7 billion euros.
The Spanish group said it would use the proceeds to cut debt by 4.6 billion euros.
Vodafone meanwhile rebounded into profit during the first half of its financial year, or six months to September.
During the same period a year earlier, the group had suffered a hefty loss after India’s Supreme Court ordered telecoms companies to pay long-standing licensing fees.


UAE-based venture builder eyes Saudi startup market

UAE-based venture builder eyes Saudi startup market
Updated 23 min 48 sec ago

UAE-based venture builder eyes Saudi startup market

UAE-based venture builder eyes Saudi startup market
  • Hatch and Boost has launched two tech startups in the UAE, with three more in the pipeline

DUBAI: Hatch & Boost, an Abu Dhabi-based venture builder (VB), was officially launched this week to spur further growth in the region’s hyperactive startup scene, particularly supporting homegrown “impact-driven business models.”

The venture builder will co-create startups alongside entrepreneurs – from concept stage to market introduction – and help to reduce costs by offering a shared pool of resources to participants.

“Our mission at Hatch & Boost is to bridge the gap between ideation and growth through our unique venture building model, which offers hands-on support from a startup’s early-most stages,” Faris Mesmar, the VB’s co-founder and managing partner, said.

Hatch and Boost has launched two tech startups in the UAE, with three more in the pipeline.

“The startup scene in the UAE has evolved considerably in recent years, and today it is a hotspot for startup activity, supported by an excellent entrepreneur-friendly infrastructure,” Mesmar added.

This startup outlook also applies to Saudi Arabia, he told Arab News, adding that they plan to bring the venture builder to the Kingdom to capitalize on its potential.

“KSA is on our radar, predominantly because it is a flourishing market with an ecosystem that’s suitable for startups,” he said.

“The PIF (Public Investment Fund) is a great example of this, as it continues to move the needle on supporting the startup ecosystem and creating a successful SME infrastructure,” Faris explained.

He added: “We have our eyes on the market, as do investors, on the rising talent and wave of entrepreneurship in the Kingdom.”


As travelers seek post-pandemic pampering, Emirates adds more Maldives and Seychelles flights

As travelers seek post-pandemic pampering, Emirates adds more Maldives and Seychelles flights
Updated 34 min 50 sec ago

As travelers seek post-pandemic pampering, Emirates adds more Maldives and Seychelles flights

As travelers seek post-pandemic pampering, Emirates adds more Maldives and Seychelles flights
  • Remote location demand on the increase
  • Gulf carriers respond to emerging travel trends

LONDON: Emirates is increasing services to the Maldives and Seychelles as travelers seek out space and luxury after a year of travel restrictions.
It comes as the region’s big carriers position themselves for an upswing in demand for travel as vaccine programs are rolled out and flying restrictions eased.
Such routes are expected to become more important amid a much slower anticipated return of premium travel, where Gulf airlines including Emirates and Qatar Airways have a strong market presence.
Both Emirates and regional hub rival Qatar Airways are seeing strong demand for Maldives getaways as the pair gradually resume flying to more destinations.
“Space is becoming the sought after commodity for many travelers and there has already been capacity added to destinations such as these by several airlines,” aviation consultant John Strickland told Arab News. “Such destinations can support a price premium too for similar reasons and when demand is broadly so weak any opportunity for airlines to tap into higher margin traffic will be welcome.”
Starting March 28, the Dubai carrier will increase services to both destinations ahead of the Easter break. It will increase its weekly Maldives service to 28 flights from the current 24. At the same time the Seychelles route will move to seven-times-a-week from the current five.
A recent report from the World Travel Tourism Council highlighted rising anticipated demand for remote destinations and beach vacations post-pandemic.
Aileen Clemente, CEO of Rajah Travel Corporation, predicted there would be “an emergence of new destinations in isolated locations as consumers veer away from ‘massification.’”
All travelers to the Maldives, excluding Maldives citizens, must present a negative COVID‑19 PCR test result, conducted within 96 hours prior to departure. Passengers must also complete an online Immigration and health self‑declaration form within 24 hours prior to arrival. Meanwhile travelers to the Seychelles will still be required to present a negative PCR test taken 72 hours prior to departure.


Bahrain bank waives loan fees for customers having had COVID-19 vaccine

Bahrain bank waives loan fees for customers having had COVID-19 vaccine
Updated 40 min 15 sec ago

Bahrain bank waives loan fees for customers having had COVID-19 vaccine

Bahrain bank waives loan fees for customers having had COVID-19 vaccine
  • Al Salam Bank is also offering a range of financial services, such as those related to the Mazaya social housing program

DUBAI: A Bahraini bank has waived loan fees for customers vaccinated against the coronavirus disease (COVID-19), part of the country’s bid to encourage people to have the jab.

Al Salam Bank is also offering a range of financial services, such as those related to the Mazaya social housing program, which all come with no administration fees if customers can produce an official medical certificate showing they have had a COVID-19 vaccine.

Mohammed Buhijji, Al Salam Bank’s head of retail banking, said: “We are proud to launch the Al Salam initiative, which aims to encourage all eligible members of the Bahraini community to take the vaccine against COVID-19, as a crucial step toward protecting themselves as individuals as well as the greater community.

“Granting a waiver of administrative fees on all financing facilities to all our customers who have been vaccinated is a reflection of our ongoing support to the public during the current circumstances.”

In late February, Bahrain’s National Health Regulatory Authority announced it had authorized the use of Johnson and Johnson’s vaccine, making it the fifth vaccine authorized in the island nation.

Bahrain was also one of the first countries to introduce a digital COVID-19 vaccine passport, which includes the user’s name, date of birth, nationality, and information on which vaccine they received.