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Oil price decreases as Saudi Arabia, Russia hint to raise production

SINGAPORE (Reuters) – Oil prices fell on Monday, extending even steeper declines from Friday, as Saudi Arabia and Russia said they may increase supplies and as U.S. production gains show no signs of abating.

Brent crude futures LCOc1 were at $75.70 per barrel at 0655 GMT, down 74 cents, or 1 percent, from their last close.

U.S. West Texas Intermediate (WTI) crude futures were at $66.78 a barrel, down $1.1, or 1.6 percent.

Brent and WTI have fallen by 6 percent and 8.3 percent respectively from peaks touched earlier in May.

In China, Shanghai crude oil futures ISCc1 tumbled by 3.8 percent to 462.3 yuan ($72.34) per barrel.

The Organization of the Petroleum Exporting Countries (OPEC), as well as top producer but non-OPEC member Russia, started withholding supplies in 2017 to tighten the market and prop up prices, which in 2016 fell to their lowest in more than a decade at less than $30 per barrel.

But prices have soared since the start of the cuts last year, with Brent breaking through $80 per barrel earlier in May, triggering concerns that high prices would crimp economic growth and stoke inflation.

“The pace of the recent rise in oil prices has sparked a debate among investors on whether this poses downside risks to global growth,” Chetan Ahya, chief economist at U.S. bank Morgan Stanley, wrote over the weekend in a note.

To address potential supply shortfalls, Saudi Arabia, de-facto leader of producer cartel OPEC, as well as top producer Russia said on Friday they were discussing raising oil production by some 1 million bpd.

“Crude oil prices collapsed … after reports emerged that Saudi Arabia and Russia had agreed to increase crude oil production in the second-half of the year to make up for losses elsewhere under the production cut agreement,” ANZ bank said on Monday.

Meanwhile, surging U.S. crude production also showed no sign of abating as drillers continue to expand their search for new oil fields to exploit.

U.S. energy companies added 15 rigs looking for new oil in the week ended May 25, bringing the rig-count to 859, the highest level since 2015, in a strong indicator that American crude production will continue to rise.

U.S. crude production C-OUT-T-EIA has already surged by more than 27 percent in the last two years, to 10.73 million barrels per day (bpd), bringing its output ever closer to Russia’s 11 million bpd.

“Oil prices are showing symptoms of a falling knife as investors are jittery on the prospect of increased production from three of the world’s top producers,” Singapore-based brokerage Phillip Futures said on Monday.


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Food group imports grow 2.32% in 10 months

F.P. Report

ISLAMABAD: The food group imports grew by 2.32 percent to $5.21 billion during first 10 months of current fiscal year (July-April, 2017-18) compared to the imports worth $5.1 billion during same period of previous year.

According to latest data released by Pakistan Bureau of Statistics (PBS), import of milk, cream and milk food also witnessed an increase of 6.48 percent as it surged to $221.266 million in July-April, 2017-18 from $207.798 million in first 10 months of the year 2016-17.

The import of dry fruits and nuts, however declined to $97.097 million in the period under review from $148.8 million during same period of last year, showing a decrease of 34.75 percent.

The tea import witnessed an increase of 9.04 percent as $492.982 million worth of import was recorded during July-April (2017-18) as compared to the import of $452.11 million during same period of last year.

Similarly, the import of spices also witnessed an increase of 18.9 percent to $136.8 million from $115.05 million while soyabean oil import jumped to $120.417 million in the period under review from $81.582 during same period last year, showing an increase of 47.6 percent.

Likewise, palm oil import also posted increase of 11.5 percent as it reached $1.73 billion from $1.5 billion in July-April 2016-17.

Sugar import increased by 1.47 percent from $4.29 million to $4.353 million while the import of pulses witnessed a decline of 47 percent as it went down to $442.731 million in July-April 2017-18 from $835.3 million in same period of last year.

On yearly and monthly basis, the import of food items in April 2018, witnessed a decrease of 15.01 percent and 5.48 percent when compared to import during April, 2017 and March 2018 respectively.

During April 2018, $485.9 million worth of import of food items was recorded as compared to the import worth $571.7 million in April 2017, and $514.1 million in March 2018.

Dry fruits and nuts’ import in April 2018 also witnessed a decline of 92 percent and 23 percent when compared to the import during April 2017 and March 2018 respectively.

Import of pulses in April 2018 declined to $34.8 million from $112 million in April 2017 and $54 million in March 2018, showing a decrease of 69 percent and 36 percent respectively.

However, import of soyabean oil in April 2018 witnessed an increase of 8.1 percent and 11 percent when compared to the import during April, 2017 and March 2018.

The import of soyabean oil in the period under review was recorded at $9.8 million compared to the import of $9.1 million same month a year ago and $3 million in March 2018.

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MoIT to improve capacity of IT industry

F.P. Report

ISLAMABAD: To compete in international arena Ministry of Information Technology and Telecommunication has aimed to improve capacity of IT industry by providing infrastructure and increasing the quality of organization to deliver high standard service and products.

The government would focus on competing in international arena, and accelerating pace of e-government to facilitate citizens to avail public services.

Talking to media outlet, ministry official said Rs6,535 million have been earmarked for ICT sector under PSDP 2018-19 which is aimed at improving capacity of IT industry by further providing infrastructure and facilities for startups and small IT businesses.

The other objective of allocation in ICT sector is to increase quality of skills and capacity of organizations to consistently deliver high quality services and products and raising their standard.

The other thrust include Cross-Border OFC system between China and Pakistan for international connectivity of voice and data traffic under aegis of CPEC which will enable alternative route for international internet connectivity.

Development of Technology Parks to facilitate rapidly growing entrepreneurial ecosystem in the country, participation in 15 major international exhibitions to generate export business, and training of 3,500 professional and 500 executives from IT and ITeS industry in latest technologies in demand and business development/international marketing respectively would also be focused.

Some other domains include 70 more companies will be provided consultancy to attain certification of CMMI level-2,CMMI level-3, CMMI level-5 and ISO 27,001/ 20,000 international standards through Ministry of Information Technology’s project entitled “Enhancing IT Exports through Industry Support Programmes,” and placement of 3,000 ICT graduates in public and private sector organizations under Prime Minister’s ICT Internship Programme.

Technical Training Institute will be established in Gilgit-Baltistan, expanding internet and broadband services in Azad Jammu and Kashmir (AJK) and Gilgit-Baltistan, and establishment of Quality Assurance Lab for software products in Pakistan Software Export board (PSEB) are the other areas which would be focused during next fiscal year.

He further said the government has planned to establish an indigenous facility for development of satellites in accordance with international space standards under its annual development plan for 2018-19.

The facility – Pakistan Space Centre will have capability to carry out manufacturing, testing, system level assembly, integration, launch and operations of various types of satellites.

As per Information and Communication Technology Annual Plan 2018-19, major thrust includes that Pakistan Multi-Mission Satellite (PakSat-MM1) will cater to demand of Direct-To-Home (DTH), High-Throughput Services (HTS)/Broadband Internet and Strategic SatCom.

The PC-II has already been approved and during next year, PC-I will be submitted for approval and subsequent execution of the project.

Moreover, feasibility study of Pakistan’s 2nd Optical Remote Sensing Satellite (PRSS-O2) will be completed. PRSS-O2 aims to launch a sub-meter resolution remote sensing satellite.

Feasibility and System Definition Study (FSDS) of Pakistan Navigation Satellite System (PakNav) will also be carried out. PakNav will enable Pakistan to have independent satellite navigation for both civilian and strategic purposes.


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Qualcomm to meet China regulators in push to clear $44 billion NXP deal: sources

BEIJING (Reuters): Qualcomm Inc (QCOM.O) is expecting to meet this week in Beijing with China’s antitrust regulators in a final push to secure clearance for its proposed $44 billion acquisition of NXP Semiconductors NV, three sources told Reuters.

The acquisition has been caught in the crosshairs of rising U.S.-China trade tensions, with sources saying an approval would depend on the progress of broader bilateral talks. The deal has got a nod from eight of the nine required global regulators, with Chinese clearance the only one pending.

Qualcomm is likely to meet Chinese regulators before US Commerce Secretary Wilbur Ross arrives in China on Saturday, the sources briefed on Qualcomm’s discussions said.

A Qualcomm team and officials from the State Administration for Market Regulation (SAMR) met in Beijing on Friday and had “productive” talks, the sources said.

The San Diego-based firm is now “cautiously optimistic” the deal will go forward, one of the sources said, amid recent indications of a thaw in U.S.-China trade tensions that has seen both sides propose tens of billions of dollars in tariffs.

On Friday, the Trump administration said it had reached a deal that would put ZTE Corp (000063.SZ)(0763.HK) back in business after the Chinese telecommunications company pays a $1.3 billion fine and makes management changes.

Resolving the ZTE sales ban has been of chief importance to China’s leadership. The firm was banned in April from buying U.S. technology components for seven years after breaking an agreement it reached for violating U.S. sanctions against Iran and North Korea.

“It feels as though it’s getting close to the end,” said the source quoted above.

Qualcomm did not immediately reply to an email from Reuters seeking comment on Sunday, while calls to NXP went unanswered outside regular business hours.

Qualcomm is now preparing a new submission to SAMR aimed at providing final guarantees and assurances, the sources said.

China’s market regulator did not immediately respond to a faxed request for comment outside of business hours. While there are no explicit ties between ZTE’s problems, Sino-U.S. trade tensions and Qualcomm-NXP merger clearance, there are “perceived linkages” and the timing of current discussions is “not coincidental”, two of the sources said. “The degree to which the two sides are moving to resolve trade tensions clearly has an impact,” one source said.

Qualcomm in recent weeks has moved to restart discussions that have stalled since the end of last year.

The company in April was forced to refile its China anti-trust application to clear the NXP deal, after talks reached a dead end.

Cristiano Amon, Qualcomm’s president, was in China last week, attending a big data industry expo in the southwest province of Guizhou.

Earlier this month, China’s anti-trust regulator approved Qualcomm’s investment with a unit of state-owned Datang Telecom Technology Co. to design, package and test smartphone chipsets, one year after the joint venture was announced.



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PIAF rejects 0.5 per cent raise in policy rate

F.P. Report

LAHORE: The Pakistan Industrial & Traders Associations Front (PIAF) has rejected the State Bank’s decision of increasing its policy rate by 50 basis points to 6.5%, reaching a level of three-year high.

PIAF Chairman Irfan Iqbal Sheikh, while issuing a statement along with senior vice chairman Tanveer Ahmed Sufi and vice chairman Shahzeb Akram, said the business community was expecting a reduction in interest rate as it was a consensus recommendation by economists that monetary policy should be eased to control adverse effects of recession.

He said the upward revision in lending rate would translate in multiplying high inflation and increasing the cost of production that would further paralyse the already numb industries. He said the SBP move would hit hard the overall economy as the availability of money to the business community had been made more expensive.

The decision would neither help curtail fiscal deficit nor control inflation as it had not served the purpose in the past rather it would create troubles for the investors.

He said the tight monetary policy was already hampering the industrial production hurting exports, increasing joblessness besides pushing up the cost of doing business.

He said in the name of reducing inflation the State Bank policy measures will generate more inflation. As a consequence of these steps inflation will not decrease but it will increase further, he added.

“In the name of reducing inflation the state bank policy measures will generate more inflation. As a consequences of these steps inflation will not decrease but it will increase further” Chairman quoted. He said that the major cause of rising inflation was increase in the prices of industrial inputs and shortage of essential items of daily use.

All these are inelastic products and monetary policy cannot control their prices. He pointed out that the SBP was preparing monetary policy without studying the nature of inflation that is not demand-pull, which can be controlled through tight monetary policy.

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BMP: Reputation of country’s national chamber on stake due to lack of business plan

F.P. Report

LAHORE: Due to lack of business plan, the National Chamber of the country i-e Federation of Pakistan Chambers of Commerce and Industry (FPCCI) is losing its identity in the public sector as well as in international bodies, said the Businessmen Panel (BMP).

In a joint statement issued here on Sunday, Vice Chairman BMP Sheikh Aslam and Secretary General (Punjab) Mian M Usman Zulfiqar said for the last almost four years, the FPCCI was converted into public relations company, the federation is least interested to play its viable role for the formulation of policies through the government.; that’s why we don’t seen Federation Chambers anywhere which is a matter of great concern for the business community of this country.

They said that since the start of 2018 the FPCCI closed its Quetta Regional Office, similarly the Regional Office of Peshawar facing acute shortage of staff and even no alternative of the electricity in time of load shedding. The Vice President FPCCI KPK doesn’t even bother to come in its Regional Office Peshawar, so how they can solve the problems of KPK traders and industrialists.

On the other hand the Research and Development (R&D) department of the FPCCI is lacking with the professional expertise.

Today Head of R&D of the FPCCI was before the PSO of the President, so you can imagine the quality work of its R&D. Yet we don’t see any research papers and any comparative study on any subject which is linked with the economy of Pakistan.

If you talk about the budget proposals, in the Ishaq Dar tenure not the single recommendation of the FPCCI was taken care; but after every budget the FPCCI is bound to please the government efforts regarding budget due to its vested interest. Is this the role of national chamber of any country; they questioned?

Parallel there is no effective international desk in the FPCCI who can even brief the Government on any recommendation regarding bilateral trade.

As well as there is no Steering Committee of FPCCI who may meet from time to time to deliberate on major government policies of concern to Pakistani business and also advises the Executive Committee of FPCCI on the issues to be taken up with the Government, which can also discusses major global and domestic trends and debates fresh ideas and perspectives on business and economy which must comprises National Experts from different fields and includes all Past Presidents of FPCCI.

They also highlighted that the FPCCI Secretary General Office is a like a post office for the Parton In Chief of the United Business Group and Former CEO TDAP. However in the tenure of the SM Muneer the TDAP has lost its relevance badly, as it was not facilitating exports.

They told the TDAP has failed to deliver on its mandate mainly because of wrong priorities and changing export patterns over the years and once again the SM Muneer closed friend Gulzar Firoz who was also the spokesperson of the ruling group UBG of FPCCI has succeeded as a member of Board of Director of the TDAP through effective lobbying. This shows that Muneer has still eye on the whelm of the affairs of the TDAP.



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Business groups write to PM urging Heathrow expansion

HEATHROW: Theresa May has been urged to stick to the government’s timetable for having a vote on Heathrow expansion.

A number of business lobby groups have signed a letter saying the government needs to “get on with expanding the UK’s airport capacity”.

Transport Secretary Chris Grayling has also been asking business groups to support the expansion plans.

The business organisations that signed the letter have all come out in favour of Heathrow expansion in the past.

The letter sent to Number 10 said: “As Brexit approaches, Heathrow expansion is crucial to making sure the UK remains an outward-looking trading nation and is well-equipped to compete on the world stage.

“For British businesses, the benefits of expansion have always been clear: connections to new markets and trading opportunities, with better links with regional airports across the UK a boost to British exports, and a skills legacy for future generations.”

The letter adds that the UK is losing ground to competition from European airports.

“There are many unknowns for businesses surrounding Britain’s future trading arrangements, but what is absolutely certain is that our economic success depends on securing Heathrow’s future as a leading international airport,” it adds.

The groups that put their name to the letter were the Confederation of British Industry, the British Chambers of Commerce, the Institute of Directors, the Federation of Small Businesses, the EEF – The Manufacturers’ Organisation, the London Chamber of Commerce and Industry, and airport expansion lobby group London First.

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Qatar bans Saudi, UAE goods from stores

Monitoring Desk

DOHA: Qatar has ordered shops to remove goods originating from a group of Saudi Arabian-led countries which a year ago imposed a wide-ranging boycott on the emirate, Doha officials said Saturday.

A directive from the economy ministry ordered shops to immediately strip shelves of products from Saudi Arabia, the UAE, Bahrain and Egypt.

Inspectors will visit stores to ensure they comply with the order, the ministry said.

The government will also try and stop products such as Saudi dairy goods from entering Qatar via a third country.

Qatar´s Government Communications Office (GCO) said it was trying to “protect the safety of consumers”.

“Products originating from blockading states, which as a result of the blockade cannot pass the GCC customs territory, has to undergo proper import inspections and customs procedures,” the GCO said in a statement. “Qatar conducts its trade policy in accordance with all of its multilateral and bilateral agreements.”

The order comes just days before the anniversary of a bitter Gulf crisis.

Since June 5 last year, Saudi Arabia, the UAE, Bahrain and Egypt have cut all relations with Qatar, accusing it of financing terrorist groups and having close ties with Iran.

The countries subsequently imposed a trade and diplomatic boycott on Qatar, which rejects the charges and says the countries are seeking regime change in Doha.

The row has forced isolated Qatar, which previously relied on its Gulf neighbors, to look elsewhere for food imports, including Turkey, Morocco and Iran. Many such imports enter the country via ports such as Kuwait and Oman.

It is through these ports, and also via individuals, that goods from the boycotting countries manage to get in to Qatar, said a source with knowledge of the situation.

“Businessmen from the blockading countries are trying to go around the blockade… by using third parties,” said the source.


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T-Mobile says ex-Trump campaign manager advising on Sprint merger

WASHINGTON (Reuters): T-Mobile US (TMUS.O) said it is getting advice on its proposed $26 billion merger with Sprint Corp (S.N) from a lobbying firm whose staff includes several members of President Donald Trump’s election team such as former campaign manager Corey Lewandowski.

Lewandowski is among those advising the No. 3 wireless company on its deal as it bolsters its defenses ahead of a what will likely be a tough regulatory review process, T-Mobile said in a statement last week.

T-Mobile US agreed in April to buy Sprint in an $26 billion, all-stock deal that will combine the third and fourth largest U.S. wireless carriers.

Lobbying disclosure reports show T-Mobile has paid Turnberry Solutions LLC $100,000 since September 2017. T-Mobile told Reuters last week that work by Turnberry included advice on its merger with Sprint.

T-Mobile added that Lewandowski “is now affiliated with (Turnberry) and they have offered perspective to T-Mobile on a variety of topics, including the pending transaction.”

According to lobbying disclosure forms filed with the U.S. Senate on April 20, Turnberry said it was providing “guidance and counsel on telecommunication issues” and had lobbied White House staff, among other agencies.

Among those lobbying on T-Mobile’s behalf from Turnberry include Mike Rubino, who oversaw Trump’s campaign in several states, Jason Osborne, a former senior adviser to the Trump campaign and Ryan O’Dwyer, a former Trump campaign aide, the disclosure report said.

T-Mobile said it hired Turnberry in August. In early August, Bloomberg News reported the company had resumed talks with Sprint about a potential merger.

The companies in November said they had called off the talks and later resumed them.

Lewandowski, who was Trump’s first campaign manager, took on a role with Vice President Mike Pence’s leadership political action committee last month.

Lewandowski did not respond to a request for comment.

Lewandowski has worked as a lobbyist and a political consultant after a nearly six month stint leading the Trump campaign in 2016.

The Federal Communications Commission must determine if the merger is in the public interest, while the Justice Department must determine if the merger would harm competition.

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Tetra Pak says plastic straws are vital

LONDON (BBC): Food packaging giant Tetra Pak has said plastic straws serve a “vital” function in cartons and should not be banned.

Plastic straws can be recycled together with used cartons if they are pushed back into the box, the company said.

Tetra Pak is developing a paper straw but it said it would still “be some time” before it was widely available.

Its statement comes amid growing concern about the effects of plastic pollution, in part helped by programmes such as the BBC’s Blue Planet II.

Last month Tetra Pak said its paper straw would be ready before the end of the year.

“In the meantime, therefore, we will continue to make the case that straws attached to our packages serve a vital functional purpose, and that bans are not the best way to tackle this issue, given the consequences of doing so,” Charles Brand, Tetra Pak’s executive vice president for product management and commercial operations, told the BBC.

The Swedish firm sent a letter to its customers in April saying that it made the paper straw announcement to address “the rising tide of negative public opinion towards plastic straws and government drives around the world to reduce their use”, according to the FT.

“For our own part, we will continue to make the case to politicians, regulators and environmental groups that the plastic straws attached to portion-sized carton packages serve an entirely functional purpose,” the letter from Mr Brand said.

In April, over 40 companies signed up to a pact with the UK government to cut plastic pollution over the next seven years.

But shareholders of fast food restaurant chain McDonald’s recently rejected a proposal to report on its use of plastic straws.

Public opinion began to turn on plastic after David Attenborough’s BBC series Blue Planet II was broadcast in November.

The first episode of the series, which was viewed over 14 million times, highlighted the damaging impact that single-use plastic is having on the world’s oceans – including a case of a pilot whale calf which was thought to have died after consuming its mother’s milk contaminated with toxic chemicals from plastic.

In January, Prime Minister Theresa May pledged to eradicate all avoidable plastic waste in the UK by 2042.