Australia proposes central bank digital currency: Crypto Wrap

Australia proposes central bank digital currency: Crypto Wrap
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Updated 08 December 2021

Australia proposes central bank digital currency: Crypto Wrap

Australia proposes central bank digital currency: Crypto Wrap

RIYADH: Australia turned the heads of crypto enthusiasts on Wednesday with the country’s Treasurer Josh Frydenberg announcing a consultation on digital currency reforms.

In a speech in Melbourne, Frydenberg said the government is studying plans for a central bank digital currency, along with regulating the crypto market, as it seeks to reform how consumers and businesses in the country pay for goods and services.

The government will also consult on a digital version of cash that will be universally accessible and consider a license framework that allows crypto transactions in a regulated environment.

The Australian government expects to receive advice on both by the end of 2022, Bloomberg reported.

“If we do not reform the current framework, it will be Silicon Valley that determines the future of our payments system,” Frydenberg said in the speech. “These are significant shifts which we need to be in front of.”

Reacting to the speech, Mikkel Morch, executive director at crypto/digital assets hedge fund ARK36 said: “Governments around the world are waking up to the reality that cryptocurrencies have already become an entrenched part of the global payments environment - and one that is preferred over the legacy systems by a growing number of individuals.

“After the recent EU crypto regulation proposal, Australia has now announced its working on a similar document - and it is to be expected that other major jurisdictions will follow suit.”

“Importantly, the scope of the regulation outlined by the Australian Treasurer doesn't seem to be overly restrictive. Clearly, then, the regulators recognise the immense economic and innovation potential of crypto and don't want to stifle it,” Morch added.

Edan Yago, the lead contributor to the Bitcoin DeFi protocol Sovryn commented that it is a “question of time” before all payments and financial transactions are digitised on public ledgers, adding: “The future of money and finance is borderless and digital.”

India

India is considering appointing a capital markets regulator to oversee cryptocurrencies, as authorities look to classify them as financial assets, Bloomberg reported.

Prime Minister Narendra Modi’s government, which is planning to introduce legislation in the ongoing Parliament session, will give cryptocurrency holders a deadline to declare their assets and fulfil any new rules.

The bill will likely use the term crypto assets instead of cryptocurrency and will not refer to the central bank's plan to create its own digital currency, according to people with knowledge of the matter.

Violators can be fined up to 200 million rupees ($2.7 million) or imprisoned for a year and a half, according to the proposals.

The government may also consider setting a minimum investment level for crypto assets to protect small investors, Bloomberg News reported.

Daily Trading

Bitcoin, the leading cryptocurrency in trading internationally, traded lower on Wednesday, falling by 2.18  percent to $50,126 at 5:37 p.m Riyadh time.

Ether, the second most traded cryptocurrency, traded at $4,401, up by 2.38 percent, according to data from Coindesk.


Oil giant Aramco signs 50 agreements during 6th iktva forum

Oil giant Aramco signs 50 agreements during 6th iktva forum
Updated 13 sec ago

Oil giant Aramco signs 50 agreements during 6th iktva forum

Oil giant Aramco signs 50 agreements during 6th iktva forum

RIYADH: Saudi oil giant Aramco signed 50 new agreements at the In-Kingdom Total Value Add forum and exhibition, known as iktva, amid its supply chain resilience enhancement.

The agreements include a climate leadership and digitalization deal with Schlumberger; equipment localization procurement agreements with Cameron, Technip FMC and Baker Hughes companies; and a partnership deal on pressure vessel fabrication localization with Larsen & Toubro.

Aramco also signed agreements with Sutherland Global Services on smart city services localization; a desalination agreement with Tanajib Cogeneration Power Co.; and a localization of process automation solutions partnership with US’s Honeywell. 

The iktva program increased Aramco’s spending with domestic suppliers in 2021 to 59 percent, up from 35 percent in 2015 when the program was launched.

Amid global supply chain disturbances, the program aims to drive domestic value creation, maximize long-term economic growth and diversification to develop a sustainable and globally competitive energy sector in the Kingdom. 

“It wasn’t possible to foresee the consequences of the COVID-19 pandemic, but iktva helped us to prepare for the disruptions it caused to the global supply chain,” Aramco CEO Amin Nasser said.

The three-day forum, running from Jan. 24 to 26 at Dhahran EXPO, showcases progress in Aramco's flagship business continuity initiative.

Held under the theme ‘Paving the way to Economic Success’, the forum recognizes the achievements of Aramco’s program partners across 10 categories, including overall iktva performance, training, Saudization, female representation and exports.

With local content contributing over $100 billion to the Saudi economy, iktva has attracted more than 540 investments to Saudi Arabia from 35 countries.


US PR firm Teneo launches Middle East financial advisory business 

US PR firm Teneo launches Middle East financial advisory business 
Image: Shutterstock
Updated 12 min 5 sec ago

US PR firm Teneo launches Middle East financial advisory business 

US PR firm Teneo launches Middle East financial advisory business 
  • The firm has services in hubs including Riyadh, Doha, and Dubai

RIYADH: US public relations and advisory firm, Teneo has launched a financial advisory business in the Middle East.

This comes as the corporation wishes to expand to key markets worldwide, with the Middle East posing as a potential growth opportunity.

As part of this move, the advisory firm has appointed Matthew Wilde and Elie Fakhoury to key roles.


Wilde is known for his role in various large scale and complex restructuring projects in the region including that of Arabtec, NMC Healthcare, Al Jaber, and others.

Fakhoury holds over 15 years of accumulated experience in the region, including covering extensive restructuring projects.

Teneo financial advisory business has around 350 employees worldwide and offering tools to tackle challenging business issues.

The firm has services in hubs including Riyadh, Doha, and Dubai.


Saudi Chemanol to expand methanol production

Saudi Chemanol to expand methanol production
Updated 20 min 49 sec ago

Saudi Chemanol to expand methanol production

Saudi Chemanol to expand methanol production

RIYADH: Saudi Arabian chemical producer Chemanol plans to expand its methanol plant, aiming to increase its production capacity to 331,000 tons.

The company said it has signed an agreement on Jan. 23 for the plant’s basic engineering design.

Additional output, which amounts to 100,000 tons, will be used as feedstock for future initiatives, including a dimethyl disulfide plant and a methyl diethanolamine factory, in line with Saudi Vision 2030.

The step is crucial for the company’s growth strategy and is expected to have a positive impact of lower production costs, it said in a bourse filing.

Earlier in 2020, Chemanol received the Ministry of Energy’s approval to allocate the required feedstock for the expansion.

 


Lebanon’s government holds budget meeting, 1st in months

Lebanon’s government holds budget meeting, 1st in months
Image: Shutterstock
Updated 52 min 56 sec ago

Lebanon’s government holds budget meeting, 1st in months

Lebanon’s government holds budget meeting, 1st in months
  • Lebanon’s economic crisis has been described by the World Bank as one of the worst in the world since the 1850s

Lebanon’s government met on the budget Monday for the first time in more than three months as talks with the International Monetary Fund about the country’s economic meltdown were poised to resume.


The developments were aimed at controlling Lebanon’s worst economic crisis in its history.

The Cabinet meeting at the presidential palace was held after the powerful Hezbollah and its main Shiite ally ended their boycott and were poised to participate in the design of a recovery plan.


The draft budget for 2022 is expected to propose increasing taxes and fees in a country struggling to deal with soaring poverty levels and hyperinflation.


It also projects spending more than 49 trillion pounds while revenues stand at just over 39 trillion pounds, with a deficit of about 21 percent.

Critics say that the deficit will be covered by printing money, in what would lead the Lebanese pound that has lost more than 90 percent of its value over the past two years to lose more in the coming months.


It is not clear what exchange rate the government will use for the budget as there are several rates around the country.

The official rate still stands at 1,500 pounds to the US dollar while the black market rate is about 23,000 pounds.

Several other rates are used for withdrawal of bank deposits.


Lebanese economist Alia Moubayed described the draft budget as “malignant and dangerous,” with problems ranging from the use of several exchange rates to indirectly legalizing the transfer of foreign currency deposits into Lebanese pounds.

Also of concern, she tweeted, is the government’s failure or refusal to recognize the “disastrous” economic and social status that resulted from decades of corruption and mismanagement by Lebanon’s political class.


Lebanon’s economic crisis has been described by the World Bank as one of the worst in the world since the 1850s.

The meltdown has left three-quarters of the population of 6 million people, including 1 million Syrian refugees, in poverty.


The government is expected to discuss the draft budget every day until Friday. If approved, it will be sent to Parliament for discussion and will need majority vote to pass.


The meeting is the first since Oct. 12, when Hezbollah and its ally, the Amal party of Parliament Speaker Nabih Berri, demanded changes in the national probe of the devastating August 2020 explosion in Beirut’s port and effectively paralyzing the government.


Hezbollah had called for the investigative judge in the port blast to be removed, accusing him of bias.

Judge Tarek Bitar has meanwhile faced a slew of legal challenges and lawsuits calling for his removal, which forced him to suspend the probe at least four times.

The probe is currently suspended.


Bitar had summoned and charged several senior officials on charges of intentional negligence that led to the explosion, which killed more than 200 people and injured thousands.

The two Shiite groups vowed to continue their efforts to remove the judge.


Deutsche Bank expected to break profit run in fourth quarter

Deutsche Bank expected to break profit run in fourth quarter
Image: Shutterstock
Updated 24 January 2022

Deutsche Bank expected to break profit run in fourth quarter

Deutsche Bank expected to break profit run in fourth quarter
  • That compares with a profit of 51 million euros a year earlier

Deutsche Bank is expected to swing to a net loss when it reports fourth-quarter earnings on Thursday amid a slowdown in revenue at its investment bank, based on analysts’ consensus estimates.


A loss would be a setback for Germany’s largest bank after reporting five consecutive quarters of profit through the third quarter, its longest streak in the black since 2012.


But the loss is expected to be a blip in the bank’s recent profit run rather than a sign of something more serious.

Analysts are forecasting full-year net profits for 2022 and 2023, based on the consensus forecast published last week by the bank.


Deutsche’s return to profit in the past few quarters has shown how a 9 billion euro overhaul by CEO Christian Sewing, begun in 2019, is paying off.

Sewing has got the bank back into profit after a string of regulatory failings and billions in losses logged over the previous decade.


Part of Deutsche’s overhaul involved reducing dependence on the investment bank’s more volatile income.

But in the past few quarters the division has been the bank’s biggest revenue earner, generating around 40 percent of the bank’s turnover by benefiting from a pandemic trading boom, as well as dealmaking fees.


The investment bank has become a fairly stable business, said Andreas Thomae, a portfolio manager at Deka, an investor in the German bank.


“Most importantly,” Deutsche has “won back customers in Germany and Europe who were a little skeptical before,” he said.


For the fourth-quarter, the bank is expected to report a net loss attributable to shareholders of around 130 million euros ($147.20 million), based on analysts’ estimates.

That compares with a profit of 51 million euros a year earlier.


Revenues for the bank as a whole as well as for its investment bank are forecast to have slipped around 4 percent from a year earlier.


Some of the big US banks’ fourth-quarter results have disappointed investors partly because of ballooning expenses, hurting profit growth.


UBS analysts said costs would be a focus for Deutsche’s fourth-quarter earnings, noting that the bank has said it wants to “clear the decks of transformation charges and other costs” this year.


2022 is a crucial year for Deutsche as it marks the deadline for the bank to meet targets set out in 2019, such as return on tangible equity.

In March, Deutsche will announce a strategy review and new targets for the years ahead.