Lebanon to resume IMF talks, begin reforms, draft policy statement says

Lebanon to resume IMF talks, begin reforms, draft policy statement says
New Prime Minister Najib Mikati’s government will also resume negotiations with creditors over a restructuring of public debt on which Lebanon defaulted last year. (Reuters)
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Updated 15 September 2021

Lebanon to resume IMF talks, begin reforms, draft policy statement says

Lebanon to resume IMF talks, begin reforms, draft policy statement says
  • New government will also resume negotiations with creditors over a restructuring of public debt
  • The draft said the government was committed to resuming talks with the IMF for a short- and medium-term support plan

BEIRUT: The Lebanese government will resume negotiations with the International Monetary Fund while beginning reforms demanded by donors, according to a draft policy program that aims to tackle one of the worst financial meltdowns in history.
New Prime Minister Najib Mikati’s government will also resume negotiations with creditors over a restructuring of public debt on which Lebanon defaulted last year, the draft seen by Reuters on Wednesday said.
The government was agreed on Friday after more than a year of political conflict over seats in cabinet that left the country rudderless as more than three-quarters of the population fell into poverty and shortages crippled normal life.
The cabinet is due to meet on Thursday to approve the draft, which will then go to a vote of confidence in parliament.
Underscoring the gravity of the situation, the policy program was drawn up in a matter of days, much faster than the weeks the process has taken in the past.
The draft said the government was committed to resuming talks with the IMF for a short- and medium-term support plan.
Donors want to see Lebanon enact reforms, including measures to tackle the corruption and graft that led to the economic collapse, before they will unlock billions of dollars of assistance already earmarked for the country.
Talks with the IMF broke down last summer when Lebanon’s political elite and banking sector objected to the scale of financial losses set out in a recovery plan drawn up by the previous government.
The draft program said the Mikati government would renew and develop the previous financial recovery plan, which set out a shortfall in the financial system of some $90 billion — a figure endorsed by the IMF.
The government will also draw up a plan to “correct the situation of (the) banking sector,” which has been paralyzed since late 2019, the draft said.
Lebanon’s financial system unraveled in late 2019.
The root cause was decades of profligate spending by the state and the unsustainable way in which it was financed.
As dollars dried up, depositors were frozen out of their accounts. The value of hard currency savings has plummeted by up to 80 percent since then, with the Lebanese pound collapsing by 90 percent from a peg that had existed for more than two decades.
The program draft said the government was committed to all the articles set out in a reform initiative drawn up by France, which has been at the forefront of efforts to help Lebanon.
The government will work with parliament to pass a capital control law, the draft document said.
It also said parliamentary elections due next spring would be held on time.


Why clubs will welcome biggest shakeup in decades for AFC Champions League

Why clubs will welcome biggest shakeup in decades for AFC Champions League
Updated 11 min 16 sec ago

Why clubs will welcome biggest shakeup in decades for AFC Champions League

Why clubs will welcome biggest shakeup in decades for AFC Champions League
  • Continent’s premier club competition set for autumn-spring schedule switch in 2023, increase in number of foreigners allowed in squads

RIYADH: Only days after Al-Hilal may have just made history by winning a record fourth Asian title, the AFC Champions League’s future is set to look very different as there are some significant changes already in place for the 2023 edition.

The Asian Football Confederation, which operates the competition that expanded from 32 to 40 teams this year, is set to officially approve a shift in the tournament’s calendar for the first time in almost two decades.

Instead of running from spring to autumn, the event will soon mirror its European equivalent by switching to an autumn start and a spring finish.

On Nov. 21, AFC President Sheikh Salman bin Ebrahim Al-Khalifa, said: “I am pleased to note that the AFC competitions continue to grow. There will be changes to the rules on foreign players, as well as to our competitions calendar. These are all part of the strategy to improve our players, clubs, and national teams on the world stage.”

The calendar change, expected to be rolled out in 2023, will return the tournament to its original schedule that was mapped out 20 years ago.

“The AFC Champions League was launched in 2002 and the inaugural season kicked off in August 2002 with its scheduled completion by May 2003,” the AFC said in a statement on Tuesday, adding that the outbreak of the respiratory illness SARS in Asia forced a postponement.

“Following this setback, the competition was relaunched in 2004 and the calendar was changed to February to December 2004, while the AFC Cup in 2004 took place from February to November 2004, leading to an adoption of the spring-autumn season,” the AFC said.

Ever since that initial change, there have been repeated requests for another look at the schedules and with a recent feasibility study being well-received, it all means that the changes will be agreed upon next year.

East Asian nations are especially happy with the change. Under the present format, the knockout stages come toward the end of the busy domestic seasons in China, South Korea, and Japan. Had Korean powerhouse Ulsan Hyundai won their semi-final against Pohang Steelers in October, the defending Asian champions would have had to travel to Riyadh for the final during the climax of the K-League title race and at the end of a grueling year.

A spring final would mean fresher eastern squads who would be just two or three months into their seasons as opposed to eight or nine.

For clubs in West Asia, it may present more of a challenge as domestic campaigns reach their zenith around the same time.

Until the final, the tournament is split into two geographic zones, east and west. That means that for much of the schedule, teams in each zone are in similar positions but the timing of the final, especially if it returns to a two-legged affair, tends to favor teams from Saudi Arabia, the UAE, Qatar, and elsewhere as they are just two or three months into their domestic seasons and approaching peak condition.

There are reasons for a switch that should benefit all. The AFC is confident that aligning the Asian calendar with much of the rest of the world, especially Europe, will make a difference financially, “for AFC Champions League and AFC Cup matches in terms of TV audiences and media interest with respect to the calendar structures of UEFA club competitions and European leagues.”

There are other changes that Saudi Arabia have pushed through. As reported by Arab News in November, the proposal from Riyadh to increase the number of foreign players that are allowed to play in the tournament has been accepted, only the precise format remains to be discussed.

At present, each team in the continental competition can register just four foreign players in its squad under the 3 plus 1 rule which means three imports can come from anywhere in the world and one from a fellow Asian nation. With 11 leagues around the continent allowing more imports for their domestic competition — including the Saudi Professional League, which has a full quota of seven — the AFC rule has increasingly become a point of contention.

“The current 3 plus 1 foreign player rule under which a club can field a maximum of four international players at any given point in time during a match is set to make way for a more augmented combination,” the AFC said.

“The proposed new combinations — 4 plus 2, 5 plus 1, or 5 plus 2 — have received wide support from both the AFC competitions committee and the AFC technical committee, with the decision imminent in early 2022 for implementation from 2023 onwards.” The changes will be confirmed early next year.

For major countries in Asian football, a revamped AFC Champions League should benefit all and help lift the tournament to the next level.


Countries launch WHO pandemic accord talks

Countries launch WHO pandemic accord talks
Updated 11 min 5 sec ago

Countries launch WHO pandemic accord talks

Countries launch WHO pandemic accord talks
  • A new agreement on pandemic preparedness and response will come into force in 2024

GENEVA: World Health Organization member states agreed Wednesday to start work on building a new international accord setting out how to handle the next global pandemic.
Countries adopted a resolution at a special meeting in Geneva, launching the process that should result in a new agreement on pandemic preparedness and response coming into force in 2024.


Oil rises 1 percent ahead of OPEC meeting under Omicron cloud

Oil rises 1 percent ahead of OPEC meeting under Omicron cloud
Image: Shutterstock
Updated 13 min 46 sec ago

Oil rises 1 percent ahead of OPEC meeting under Omicron cloud

Oil rises 1 percent ahead of OPEC meeting under Omicron cloud
  • A Reuters survey found OPEC pumped 27.74 million bpd in November, up 220,000 bpd from the previous month

Oil prices clawed back some losses on Wednesday after steep falls in the previous session, as major producers prepared to discuss how to respond to the threat of a hit to fuel demand from the Omicron variant.


US West Texas Intermediate (WTI) crude futures rose 78 cents, or 1.2 percent, to $66.96 a barrel at 0122 GMT, after a 5.4 percent drop on Tuesday.


Brent crude futures gained $1.01, or 1.5 percent, to $70.24 a barrel, after a 3.9 percent slump on Tuesday.


The Organization of the Petroleum Exporting Countries (OPEC) will meet on Wednesday after 1300 GMT ahead of a meeting on Thursday of OPEC+, which includes OPEC and allies including Russia.


While some analysts expect OPEC+ will pause plans to add 400,000 barrels per day of supply in January in light of the potential hit to demand from travel curbs to rein in the spread of the Omicron variant, several OPEC+ ministers have said there was no need to change course.


“The market continues to look for signs of any impact of Omicron on demand,” ANZ Research commodity analysts said in a note.


Even if OPEC+ agrees to go ahead with its planned supply increase in January, producers may struggle to add that much.


A Reuters survey found OPEC pumped 27.74 million bpd in November, up 220,000 bpd from the previous month, but that was below the 254,000 bpd increase allowed for OPEC members under the OPEC+ agreement.


In a bearish sign on demand, data from the American Petroleum Institute industry group showed US crude stocks fell by 747,000 barrels in the week ended Nov. 26, according to market sources, which was a smaller decline than expected.


Ten analysts polled by Reuters were expecting crude stockpiles to fall by about 1.2 million barrels.


At the same time, gasoline inventories rose by 2.2 million barrels compared with analysts’ forecasts for no change, while distillate stocks rose by 789,000 barrels, which was a bigger build than analysts had expected.


China calls on citizens to leave eastern Congo after attacks

China calls on citizens to leave eastern Congo after attacks
Updated 26 min 47 sec ago

China calls on citizens to leave eastern Congo after attacks

China calls on citizens to leave eastern Congo after attacks
  • A number of Chinese citizens had been attacked and kidnapped over the past month in the provinces of South Kivu, North Kivu and Ituri

BEIJING: China on Wednesday urged its citizens to leave three provinces in eastern Congo as violence intensifies in the mineral-rich region.
A posting from the Chinese Embassy in Kinshasa on the WeChat online messaging said a number of Chinese citizens had been attacked and kidnapped over the past month in the provinces of South Kivu, North Kivu and Ituri, where several anti-government rebel groups have a presence.
It said Chinese residing in the three provinces should provide their personal details by Dec. 10 and make plans to leave for safer parts of Congo. Those in the districts of Bunia, Djugu, Beni, Rutshuru, Fizi, Uvira and Mwenga should leave immediately, it said, adding that any who do not do so “will have to bear the consequences themselves.”
“We ask that all Chinese citizens and Chinese-invested businesses in Congo please pay close attention to local conditions, increase their safety awareness and emergency preparedness, and avoid unnecessary outside travel,” the embassy said.
No details of the incidents were given, although the embassy last month reported five Chinese citizens were abducted from a mining operation in South Kivu, which borders Rwanda, Burundi and Tanzania.
It warned a the time that the security situation in the area was “extremely complex and grim” and that there was little possibility of sending help in the event of an attack or kidnapping.
No details were given about those kidnapped, who they worked for or who was suspected of taking them.
Several armed groups including the Democratic Forces for the Liberation of Rwanda, known by its French acronym FDLR, the Mai-Mai and the M23 regularly vie for control of eastern Congo’s natural resources.
Despite the danger, Chinese businesses have moved into Congo and other unstable African states in a quest for cobalt and other rare minerals and resources. Chinese workers have also been subject to kidnappings and attacks in Pakistan and other countries with active insurgencies.
Security was a key topic at a meeting Monday in Dakar, the capital of Senegal, on Monday, between Chinese Foreign Minister Wang Yi and his Congolese counterpart Christophe Lutundula, according to China’s Xinhua News Agency.
China’s government and ruling Communist Party “attach great importance to the safety and security of Chinese enterprises and Chinese nationals overseas and the Chinese side has been extremely concerned with the recent serious crimes of kidnappings and killings of its citizens in the DRC,” Wang said, using the acronym for the Democratic Republic of Congo.
Wang urged Congo to secure the release of those kidnapped and create a “safe, secure and stable environment for bilateral cooperation.”
Xinhua quoted Lutundula as saying Congo would take “forceful measures” to investigate the crimes, free the hostages, punish the culprits severely and safeguard national security and restore stability to the country’s east.
Earlier this week, Uganda said it launched joint air and artillery strikes with Congolese forces against camps of the extremist Allied Democratic Forces rebel group in eastern Congo.
The ADF was established in the early 1990s in Uganda and later driven out by the Ugandan military into eastern Congo, where many rebel groups are able to operate because the central government has limited control there.
At least four civilians were killed less than two weeks ago in Uganda’s capital when suicide bombers detonated their explosives at two locations.
The Daesh group claimed responsibility, saying the attacks were carried out by Ugandans. Ugandan authorities blamed the ADF, which has been allied with the Daesh group since 2019.


VW expects battery, raw material drive to cost up to $34bn

VW expects battery, raw material drive to cost up to $34bn
Image: Shutterstock
Updated 33 min 18 sec ago

VW expects battery, raw material drive to cost up to $34bn

VW expects battery, raw material drive to cost up to $34bn
  • Schmall is overseeing Volkswagen’s ambitious plan to build six large battery cell plants in Europe by the end of the decade

Volkswagen’s planned European battery cell plants and securing vital raw materials will cost as much as 30 billion euros ($34 billion), board member Thomas Schmall said, putting a price tag on the expansion for the first time.


Schmall, who is in charge of technology at Europe’s largest carmaker, said in an interview at  the  Reuters Next conference that Volkswagen would seek outside partners to fund it.”


“We are talking about 25 to 30 billion (euros) ... including the vertical chain of raw materials, not only the factories,” the 57-year old said, adding VW would not have to take the lead on funding and was not aiming for a 50/50 investment split.


“It depends on the partnership model we will establish in the next months. We’re open to discuss it. For us it’s necessary that we can control ... the technology roadmap, the timing, the costs and the availability to enable our rollout.”


Schmall is overseeing Volkswagen’s ambitious plan to build six large battery cell plants in Europe by the end of the decade, a strategic pillar in its bid to overtake Tesla and become the world’s top electric vehicles seller.


Sweden’s Northvolt, the first plant in which Volkswagen owns a fifth, will start production premium cells for the German carmaker from 2023. The second plant, to be built jointly with China’s Gotion High-Tech in Salzgitter, is to start in 2025.


Four more plants will follow by the end of the decade, most likely in Spain, eastern Europe and two additional locations that have so far not been disclosed.


Costs will be 1 billion to 2 billion euros per plant while capacity will range from 40 up to a maximum of 80 gigawatt hours (GWh), depending on the chemistry as well as whether enough energy supplies are available, Schmall said.


“We have some natural limits in the availability of utilities, energy, water,” he said.

But production capacity is only one part of the equation, Schmall said, adding that Volkswagen also had to make sure it gets enough raw materials, such as lithium and nickel.


This requires a more proactive approach and Schmall said that Volkswagen was looking to strike partnerships, with cooperation announcements due “in some weeks.”


Volkswagen, which plans to submit its next five-year investment plan to the supervisory board on Dec. 9, is pursuing a mix of strategies, which might even include becoming a shareholder in a mining firm.


“You will see the full range,” Schmall said, also referring to fixed and mixed price contracts with suppliers. “You have to tailor-fit solutions, necessarily, to specific raw materials.”


This also requires making sure that materials are procured sustainably, which, in Volkswagen’s case, includes transparency reports, supplier ratings, and efforts to phase out some materials, most notably cobalt.


In the end, Schmall said, the goal was to ensure that the full production chain was sustainable, adding that producing electric vehicles alone was not enough for Volkswagen, which is aiming to be carbon neutral by 2050 at the latest.


“And this altogether brings us in this closed loop and hopefully show you that we are taking care from the beginning on, from the first step, from the mining process, to be sustainable, until the last point of battery lives and car lives and recycling,” he said.