UAE central bank backs anti-money laundering

Dubai has now lifted the visa ban imposed due to the pandemic. (AFP)
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Updated 25 September 2020

UAE central bank backs anti-money laundering

  • Move to safeguard financial stability in COVID-hit economy

DUBAI: The UAE central bank has said that banks should increase anti-money laundering efforts to safeguard financial stability in the country.

“To mitigate the risk of financial crimes . . . banks are urged to put more efforts towardcombating money laundering and financing of terrorism,” it said in a statement.

The bank said more than 300,000 individuals, close to 10,000 small and medium enterprises, and more than 1,500 private companies, had benefited from a 50 billion dirhams ($14 billion) liquidity scheme introduced to cushion against the impact of the COVID-19 pandemic.

On Wednesday, the UAE reported its highest daily number of coronavirus infections since the start of the pandemic.

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The UAE Central Bank expects the country’s economy to contract by 5.2 percent this year.

In a separate report, the central bank said this week that the UAE economy would likely contract by 5.2 percent this year, revising down a previous 3.6 percent contraction forecast, as virus containment measures hurt sectors such as trade and tourism.

It said that manufacturing production shrank “due to supply chain disruptions, limited export opportunities and subdued domestic demand.”

The UAE said on Thursday that it would resume issuing visas to foreign visitors to all seven of its regions after a six-month suspension imposed due to the pandemic, state media reported.

Dubai, the region’s tourism and business hub and one of the seven emirates that make up the UAE, had already lifted its own visa ban in July.

The Federal Authority for Identity and Citizenship said in a statement carried in state media that the decision was taken as part of the easing of COVID-19 restrictions in the Gulf state as well as efforts to support economic recovery plans.

All six Gulf Arab countries have lifted internal curfews and lockdowns, but restrictions on gatherings and foreign travel remain in the oil-producing region, where the total number of COVID cases stands at more than 800,000, with more than 6,800 deaths.


‘The stock market, stupid’ — Trump’s claim is looking hollow 

Updated 29 October 2020

‘The stock market, stupid’ — Trump’s claim is looking hollow 

  • The timing of the Wall Street downturn is the worst possible for the incumbent, who has declared every new peak in the S&P as a personal victory throughout his presidency
  • The likes of Apple, Amazon, Alphabet and Facebook are due to declare their earnings for the third quarter, and how those numbers are received could give the indices a boost

Before the US election of 1992, candidate Bill Clinton summed up what he saw as the reason he would become president: “It’s the economy, stupid.” He was proved right as voters disowned the economic policies of President George H.W. Bush in their droves to elect Clinton. 

Until the COVID-19 pandemic began to ravage the US economy in March, President Donald Trump would have been able to make the same claim. For the four years of his presidency, the US economy had continued the progress initiated by his predecessor to recover from the 2009 global financial crisis.

By most measures — growth, employment, inflation — the Trump years had been good, and those on the top of the pile had even more reason to be grateful thanks to the big tax cuts he had made a flagship policy.

The pandemic changed all that in the space of a few weeks as lockdown measures shocked the economy. Jobless claims soared to all-time records, bankruptcies and closures affected large swathes of American business, and gross domestic product collapsed. The International Monetary Fund forecasts that the American economy will shrink by 4.3 percent this year.

But Trump could still claim instead that “it’s the stock market, stupid” as a reason he could be re-elected. Mainly because of the trillions of dollars injected into the economy in the form of fiscal stimulus, US share indices had swum against the economic tide.

The S&P 500 index hit an all-time high in September, allowing Trump to boast that under his administration, investors and the millions of people whose livelihoods depended on the financial industry had never had it so good.

Now, it looks as though even that final claim is looking more fragile. For the past couple of days, US and European stock markets have gone into reverse as investors took fright at the rising number of COVID-19 cases and the re-imposition of economic lockdowns in many countries.

Trump might argue, with a little justification, that Wall Street is worried about the prospect of Joe Biden being elected president by the end of next week. Certainly the contender, by definition, is something of an unknown quantity in terms of economic policy.

He is also known to favor some policies — such as tighter regulation on environmental sectors, more spending on health care, and higher taxes for federal services and projects — that have traditionally been regarded as contrary to the philosophy of “free market” America.

In particular, the energy industry is worried about possible restrictions on shale oil and gas production that Biden and his “green” team are believed to favor. However, it should be pointed out that the Democratic candidate has specifically said he will not ban shale fracking, as some environmentalists want.

In any interesting side-story, the state of Texas — one of the biggest in terms of electoral college votes — would seem to have more to lose than any other if the energy scare stories about Biden were true. Yet the contest there between Democrats and Republicans is the closest it has been for decades, according to opinion polls.

The timing of the Wall Street downturn is the worst possible for the incumbent, who has declared every new peak in the S&P as a personal victory throughout his presidency and a sign of his deal-doing prowess. If even this claim is denied to him in the final week of campaigning, it would make the uphill battle against the polls even more difficult.

There is a chance that Big Tech might offer some relief. The likes of Apple, Amazon, Alphabet and Facebook are due to declare their earnings for the third quarter, and how those numbers are received could give the indices a boost, given that they were the ones largely responsible for the big market gains earlier in the year.

But for Trump, any such respite might be too little, too late. It looks as though Wall Street and Main Street are finally catching up in their gloom, and there is nothing the president can do about it.