Lebanon sells cheapest Big Mac in the world as currency collapses

Lebanon sells cheapest Big Mac in the world as currency collapses
For those paid in Lebanese pounds, the Big Mac is becoming an increasingly unaffordable luxury. (Reuters)
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Updated 27 July 2021

Lebanon sells cheapest Big Mac in the world as currency collapses

Lebanon sells cheapest Big Mac in the world as currency collapses
  • Lebanese pound is 70 percent undervalued according to the Big Mac Index
  • A split is emerging between those paid in Lebanese pounds and those in dollars

RIYADH: Lebanon is home to the world’s cheapest Big Mac after the pound slumped in value, leaving it more than 70 percent undervalued against the US dollar, according to the Economist Intelligence Unit.

At 29,904 Lebanese pounds, a Big Mac is not cheap for those being paid in local currency, but with an exchange rate of 17,800 to the dollar, it costs just $1.68 for tourists and those lucky enough to get paid in dollars.

The slump in the Lebanese pound is exacerbating and accelerating inflation on a basic basket of goods, such as rice, sugar and flour, on a daily basis, said Lebanese economic analyst Bassel Al-Khatib.

Most people are paid in the local currency in Lebanon, where the national minimum wage stands at 675,000 Lebanese pounds per month, which was once worth almost $450 at the official exchange rate, but today barely fetches $30 on the black market, according to the Crisis Observatory at the American University of Beirut (AUB).

The Observatory said the cost of food has soared by 700 percent over the past two years, and this increase had picked up pace to 50 percent in the past few weeks alone.

Most Lebanese people are getting poorer on a daily basis, pushing some of them to sell their gold, cars and even furniture to survive, while others wait for US dollar transfers from their relatives abroad, or wait for civil society aid, Al-Khatib told Arab News.

This is all reflected in Lebanese social media, which is flooded with donation requests for new-born baby milk and medications that are not available anymore in the markets or are sold for extremely high prices. There are also numerous donation requests for people in need of food.

At the same time, others are sharing their expensive restaurant bills, such as Babel Baher who spent 5 million Lebanese pounds on a meal and posted the cheque on Facebook.

“$250 is almost nothing for someone coming from abroad,” a Facebook user called Rania wrote under the post. “This is a very cheap bill for someone who has US dollars and this dinner is not expensive at all compared to abroad.”

Al Khatib said that those paid in US dollars are living an affordable life with only $300 out of their salaries while before they needed $3,000 to have the same quality of life.

“The patchwork policies to support some commodities is not helping as all commodities that are subsidized are smuggled, ” said Al Khatib.

The country’s mismanagement with no plan or economic vision to save Lebanon from its worsening crisis, led us here, and there are no positive prospects as long as there are no radical solutions in the country, he said.


Saudi Arabia issues penalties in crack down on electronic employment platforms

Saudi Arabia issues penalties in crack down on electronic employment platforms
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Updated 21 sec ago

Saudi Arabia issues penalties in crack down on electronic employment platforms

Saudi Arabia issues penalties in crack down on electronic employment platforms
  • Penalties can be doubled according to the frequency of violations

Saudi Arabia issued penalties in a move to regulate employment in electronic employment platforms as demand for mobile and web applications is booming in the Kingdom.

The Ministry of Human Resources and Human Development issued four penalties for violations on electronic platforms that range between SR5,000 ($1333) and SR50,000 ($13,333), Okaz paper reported.

The violations include the platforms enabling non-Saudi workers to work directly through the platform, platforms not verifying that the worker does not work on behalf of other people, platforms with incorrect data for workers, and those that have not supplied the requested data and information to the ministry.

Penalties can be doubled according to the frequency of violations.

The Minister, Ahmed Alrajhi, had previously obligated electronic platforms to limit direct interactions to Saudi nationals only and not to deal directly with non-Saudi workers except through the operating establishments.

 

 

 

 

 

 


Saudi food group Savola completes $260m acquisition of UAE’s Bayara

Saudi food group Savola completes $260m acquisition of UAE’s Bayara
Updated 17 October 2021

Saudi food group Savola completes $260m acquisition of UAE’s Bayara

Saudi food group Savola completes $260m acquisition of UAE’s Bayara
  • The transaction, paid in cash according to a stock exchange filing, was part of a five-year strategy to expand Savola’s regional operations.

DUBAI: Saudi Arabia’s Savola Group has completed the full acquisition of Emirati snack maker Bayara Holding, in a deal worth SR975 million ($260 million).

The transaction, paid in cash according to a stock exchange filing, was part of a five-year strategy to expand Savola’s regional operations.

Bayara is a major manufacturer and distributor of branded snacks in the UAE and the Kingdom.


Harsh reality of net-zero commitments under scrutiny

Harsh reality of net-zero commitments under scrutiny
Updated 16 October 2021

Harsh reality of net-zero commitments under scrutiny

Harsh reality of net-zero commitments under scrutiny
  • Call to set clear goals for cutting greenhouse gas emissions

LONDON: The current spike in oil and gas prices could not have come at a worse time. On the eve of the UN COP26 global climate conference in Scotland this month, soaring energy prices are resulting in increased investor interest in fossil fuel companies.

The S&P 500 energy sector is up around 50 percent this year and has been the wider index’s best-performing group.

Indeed, a recent report stated financial institutions in the G20 are carrying almost $22 trillion of exposure to carbon-intensive sectors despite increasing pressure for companies to disinvest in polluting industries.

The report, by Moody’s Investors Service, warned banks and asset managers need to “ramp up” climate risk assessments and “set clear goals for reaching net-zero in their financed emissions.”

Moody’s warning comes after the London Financial Times reported this week that global banks have refused to commit to the International Energy Agency’s road map for cutting greenhouse gas emissions to net zero by 2050.

The FT said negotiators for the Glasgow Financial Alliance for Net Zero, an initiative led by UN special envoy for climate action and finance Mark Carney to encourage finance groups to stop funding fossil fuel companies, have struggled to convince banks to agree to end financing of all new oil, gas and coal exploration projects this year.

Many analysts believe the huge rises in gas and oil prices is evidence of the risks of phasing out fossil fuel production too quickly while renewable energy remains unable to pick up the slack of global demand.

Earlier this year, Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman criticized the IEA’s call for the energy sector to be net zero by 2050, calling it a “la-la-land” scenario.

Last week, Qatari Energy Minister Saad Al-Kaabi criticized governments for making statements about eliminating emissions without adopting clear plans to achieve net-zero.

Al-Kaabi’s comments followed an announcement by Dubai’s ruler Sheikh Mohammed bin Rashid Al-Maktoum, that the country planned to become the first Middle East oil producer to achieve net zero by 2050.

The UAE’s emissions averaged almost 21 metric tons per person in 2018.

As a comparison, the figure in France, which is also committed to net zero by 2050, is 4.6.

Along with the UAE, Russia and Turkey also announced recently that they could be net-zero by 2060 and 2053 respectively although there were no details outlining they will move their economies away from fossil fuels.

The move follows EU plans to impose a carbon-border tariff that could force Russian and Turkish companies to pay for excess emissions in key industries.

However, for Russia to achieve net-zero by 2060 would require a massive overhaul of its economy.

Russia’s oil and gas sales contribute between 15 to 20 percent of the country’s GDP and fossil fuel exports account for more than 50 percent of all exports. The country’s coal industry contributes around 12 percent to GDP.

Achieving net-zero in Russia by 2060 will require a 65 percent reduction in its emissions according to research institute the World Resources Institute. Yet Russia’s most recent submission to the UN under the Paris Agreement suggested its emissions would increase 30 percent by the end of the decade compared to 1990 levels.

Meanwhile Turkey, which last week became the last G20 country to ratify the Paris accord, would have to slash its emissions by around 30 percent by the end of the decade to reach its 2053 target. The WRI had forecast Turkey was set to double its current emissions by the end of the decade.

While governments step up their commitments to sustainability to fend off new regulations and respond to growing pressure from investors the reality looks very different.

Moody’s report said G20 banks’ exposure to carbon-intensive sectors amounted to $13.8 trillion, while equities held by asset managers were worth $6.6 trillion.

Regionally, Asia and the Americans led the way with $9 trillion and $8 trillion respectively, with EMEA accounting for $5 trillion. There was no country breakdown.

By sector, manufacturing, power and other utilities, transportation, and oil and gas feature heavily among the G20 financial institutions’ top carbon-intensive exposures.

Companies and governments remain under increasing pressure from both climate-focused regulations and shareholder pressure to disinvest in polluting industries.

However, in a report published last month the WRI said G20 countries still account for 75 percent of global greenhouse gas emissions.

Helen Mountford, vice president, Climate & Economics, WRI said: “Action or inaction by G20 countries will largely determine whether we can avoid the most dangerous and costly impacts of climate change.”


Work on NEOM’s green hydrogen plant likely to start in H1 2022

Work on NEOM’s green hydrogen plant likely to start in H1 2022
Updated 17 October 2021

Work on NEOM’s green hydrogen plant likely to start in H1 2022

Work on NEOM’s green hydrogen plant likely to start in H1 2022
  • What we have already said is that we will be dispatching liquid ammonia into the market in the first quarter of 2026, so that’s already there: ACWA Power CEO

RIYADH: Saudi Arabia’s energy company, ACWA Power, expects construction work on its green hydrogen plant in NEOM to start in the first half of 2022, according to the company’s CEO.

“This is the first project of that scale and quite a lot of work had to be done for the first time. So, we are very much in it, and we are already in even doing some work in advance purchases of long lead items for construction. So, there is quite a lot of activity that is going on,” Paddy Padmanathan told Arab News in an interview.

The CEO of ACWA expected to also see the financial closing of the project, a joint venture with NEOM Co. and American industrial gas company Air Products, taking place in the first half of the next year. The joint venture had hired financial firm Lazard to advise on the project, he told Arab News last month.   

“We are going to full construction as soon as we have achieved the financial closure. What we have already said is that we will be dispatching liquid ammonia into the market in the first quarter of 2026, so that’s already there,” he added.

ACWA Power, which debuted on Saudi Arabia’s stock market on Oct. 4, expects to finalize in the first quarter of next year billions of dollars in financing for a green hydrogen joint venture at the planned futuristic city NEOM, ACWA’s CEO told Reuters last week, adding that roughly 20 percent of the $6.5 billion project will be funded with equity and the rest will be limited-recourse project finance.

Padmanathan believes that NEOM’s project will be a game changer for the Kingdom and the company as it will help ACWA expand into that industry once it’s completed. The plant will need around 4.3 GW of clean energy to power it and ACWA plans to use solar in the day and wind in the night to eliminate the need for batteries and expensive storage solutions, he told Arab News.

In July 2020, Air Products, in conjunction with ACWA Power and NEOM, announced the signing of an agreement for a $5 billion world-scale green hydrogen-based ammonia production facility powered by renewable energy. The planning and design phases are currently underway to start construction in NEOM’s new industrial city.

This joint venture is the first step for the NEOM region to become a key player in the global hydrogen market. The business is expected to build an environmentally friendly hydrogen production facility to provide sustainable solutions for the global transport sector and to meet the challenges of climate change.

The project, which will be equally owned by the three partners, will export hydrogen in the form of liquid ammonia to the world market for use as a biofuel that feeds transportation systems.

It will produce 650 tons of carbon-free hydrogen per day and 1.2 million tons of green ammonia per year, reducing carbon dioxide emissions by the equivalent of 3 million tons per year.

ACWA Power, which operates in 13 countries, is bidding for renewable energy projects in Uzbekistan, Egypt, South Africa and Indonesia, as well as a large pipeline of projects in Saudi Arabia, the CEO said.

The company, which the Public Investment Fund is a key shareholder in, uses project finance to fund all of its projects but it will continue investing around SR2.8 billion a year of its own money into these projects to keep growing, Padamanthan told Arab News last month.

ACWA Power is planning projects this year with a total investment cost of around $16 billion, ACWA’s CFO told Arab News in July.


AD Ports Group report 21% rise in H1 revenue

AD Ports Group report 21% rise in H1 revenue
Updated 16 October 2021

AD Ports Group report 21% rise in H1 revenue

AD Ports Group report 21% rise in H1 revenue

DUBAI: AD Ports Group on Saturday reported a 21 percent year-on-year increase in revenues in the first half of the year, the official WAM new agency reported. 

According to the financial results, the group reported 1,832 million dirhams ($499 million) revenue as compared with 1,517 million dirhams in the first half of 2020, driven by organic growth, diversification into new businesses, new leases and partnerships.

EBITDA rose 8 percent year-on-year to 770 million dirhams, up from 714 million dirhams in the first half of 2020, with growth across most of the business clusters.