TRIBUNE NEWS NETWORKDOHA

QATAR’S role in promot-ing trade between the Arab countries and Turkey came in for praise at a joint meet-ing between Arab and Turkish chambers of commerce held in Beirut recently.

The participating delega-tions welcomed Qatar’s pro-posals, said Qatar Chamber Director General Saleh bin Hamad al Sharqi, who repre-sented the organisation at the meeting.

Sharqi said QC proposed to host the Arab and Turkish chambers meeting to be held af-ter the next meeting in Algeria.

The latest meeting, which aims to promote Turkish-Arab economic and trade relations, focused on the need to raise the Arab-Turkish cooperation to desired levels.

Shaqi said the trade volume between the Arab countries and Turkey recently saw growth, reaching nearly $50 billion annually. Howev-er, he said, it is still does not match the potential of the two sides.

President of the Union of Turkish Chambers and Com-modity Exchanges Rifat Hisar-cikli Oglu said the Arab world and Turkey have great poten-tial, which has not yet been fully exploited.

TRIBUNE NEWS NETWORKDOHA

QATAR Industrial Manufac-turing Company (QIMC) has finalised the acquisition of United Development Compa-ny’s (UDC) stake (400 shares) in Gulf Formaldehyde Compa-ny (GFC), the company said in a statement on Sunday.

The UDC stake represented 10 percent of GFC’s share capi-tal and by acquiring it, QIMC has increased its ownership in GFC to 30 percent. This will be reflected in UDC’s 2018 first quarter results.

The sale deal was signed by QIMC Chairman Sheikh Ab-dul Rahman bin Mohamed bin Jabor al Thani, CEO Abdul-rahman al Ansari, UDC Chair-man Turki bin Mohammed al Khater and President & CEO Ibrahim Jassim al Othman.

QIMC, Sheikh Abdul Rah-man said, is keen on strength-ening its investment portfolio in the industrial sector.

“QIMC hopes the deal will have a positive impact on its future corporate earnings,” he added.

Khater, the UDC Chair-man, said, “The sale of UDC’s shares is consistent with the company’s strategy of focusing

on core activities, namely real estate development and related operational services.”

CEO Othman said, “Over the last several years, UDC has emerged as a leader in the real

estate development sector in Qatar and the region. We will continue along this successful path by focusing on the busi-nesses that cater to our target-ed growth.”

GFC was established in 2003 by Qatar Fertilizer Com-pany (QAFCO), Qatar Indus-trial Manufacturing Company (QIMC) and United Develop-ment Company (UDC) to pro-

duce urea formaldehyde con-centrate with a design capacity of about 170 tonnes per day.

United Development Com-pany (UDC) is a leading Qatari public shareholding company with a mission to identify and invest in long-term projects contributing to Qatar’s growth and providing good sharehold-er value. Established in 1999, the company became listed on the Qatar Stock Exchange in June 2003.

QIMC has so far partici-pated in 20 industrial projects, most of them in the production stages in various industrial sec-tors, including petrochemical, chemical, construction and food. In addition, a number of new projects are in stages of being incorporated.

With the acquisition, QIMC increases its ownership in GFC from 20 percent to 30 percent

QIMC acquires UDC stake in Gulf Formaldehyde Company

Qatar’s role spurring Arab-Turkey trade ties extolled at Beirut meet

UDC Chairman Turki bin Mohammed al Khater (2nd L) shakes hands with QIMC Chairman Sheikh Abdul Rahman bin Mohamed bin Jabor al Thani as UDC President & CEO Ibrahim Jassim al Othman (extreme left) and QIMC CEO Abdulrahman al Ansari look on.

SATYENDRA PATHAK DOHA

SRI Lanka is aiming to double the number of its workforce in Qatar, the country’s top envoy has said.

In an exclusive interview with Qatar Tribune, Sri Lankan Am-bassador to Qatar HE Panagoda Don Prince Solomon Anura Liyan-age said that Sri Lanka is preparing its skilled workers for thousands of high-skill jobs to be announced in Qatar in the second half of this year.

“As per our information, Qa-tar will require thousands of skilled workers to work on various projects to be announced later this year. Sri Lanka wants to take full advantage of this opportunity by encouraging its skilled workforce to take jobs in Qatar,” Liyanage said.

Praising the Qatari leadership for amicably dealing with the on-going blockade, the envoy said that Qatar has succeeded in reorganis-ing its trade routes with the rest of the world to ensure that projects related to 2022 FIFA World Cup are executed as per schedule.

Currently, 140,000 Sri Lankans work in Qatar, the envoy said, adding that various initia-tives are being taken to double this number in the near future.

Also known as ASP Liyanage, the Sri Lankan envoy said Qatar is one of the most preferred destina-tions for Sri Lankan workers as the country maintains a very high level of living standards.

Besides being one of the richest countries in the world, the en-voy said, Qatar is also a very peaceful and stable country.

The envoy said Sri Lankans have expertise to work in various eco-nomic sectors of Qatar.

Q a t a r ’ s private sec-tor is growing at a fast pace, the envoy said, adding that the Sri Lankan embassy in Qa-

tar is in talks with various private firms through Qatar Chamber to seek job opportunities for its skilled and semi-skilled workers.

In a bid to showcase the exper-tise of Sri Lankans in various eco-nomic fields, the ambassador said an ‘Employment Promotion in Qa-tar’ forum was organised in Doha.

“We got a very good response as a number of Qatari firms par-

ticipated in the forum and ex-pressed their wi l l ingness to hire Sri Lankan work-ers,” the en-voy said.

“We want to see more skilled workers and employees from Sri Lanka taking part in the mega projects being implemented for developing the infrastructure for the 2022 FIFA World Cup,” he said.

Given the growing potential of the two countries, the envoy said, the current trade volume of $73 million between the two countries is very low.

“Both the countries have signed a number of agreements to boost bilateral trade. Lulu Group has already started resourcing a number of food products from Sri Lanka for its hypermarkets in Qa-tar. It will give a big boost to trade ties between the two countries,” the envoy said.

Besides trade, the envoy said, a number of initiatives are also being taken to look for investment op-portunities in both the countries.

Qatari businessmen should ex-plore the huge investment oppor-tunities in Sri Lanka and establish business partnerships and allianc-es with their Sri Lankan counter-

parts, the envoy said.Many Sri Lankan com-

panies are looking to take part in Qatari projects

and establish joint ventures in all sec-

tors, he noted.

The sale of UDC’s shares is consistent with the company’s strategy of focusing on core activities, such as real estate development and related operational services.UDC Chairman Turki bin Mohammed al Khater

Qatar Chamber Director General Saleh bin Hamad al Sharqi shakes hands with a delegate at a joint meeting between Arab and Turkish chambers of commerce, in Beirut recently.

PHOTO: HANSON K JOSEPH

QT EXCLUSIVE

As per our information, Qatar will require thousands of skilled workers to work on various projects to be announced later this year. Sri Lanka wants to take full advantage of this opportunity by encouraging its skilled workforce to take jobs in Qatar

Sri Lankan Ambassador to Qatar HE ASP Liyanage

Sri Lanka aims to double number of workers in Qatar: Ambassador

No of expats

140,000the number of Sri Lankan expats working in Qatar at present

MONDAY, FEBRUARY 19, 2018

Sri Lanka honours Doha Bank CEO R Seetharaman PAGE 18

www.facebook.com/QatarTribune

www.twitter.com/Qatar_Tribune

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18 Monday, February 19, 2018

TRIBUNE NEWS NETWORKDOHA

THE Qatar Stock Exchange (QSE) has published aware-ness information on exchange traded funds (ETFs) in terms of its general concept, mecha-

nism of composition, characteristics and advantages.

This comes in line with Doha Bank's issuance of a "Brief Prospec-tus" that provides investors with basic information about the Doha Bank ETF (QETF), which tracks QE Index, the QSE said in a press state-ment on Sunday.

The publication of the informa-tion will help enhance awareness of this new investment tool in the mar-ket, the statement added.

Exchange traded funds (ETFs) are a collection of securities pack-aged within a fund structure, against which fractional ownership is pro-vided in the form of units which are listed and traded upon an exchange.

Almost all ETFs passively track a benchmark index. The index may consist of stocks, bonds or com-modities. The first ETFs in Qatar will track well known equity indices calculated by QSE. Typically, stocks in an equity index are weighted by market capitalisation although dif-ferent schemes have now became prevalent, for example you might see a stock weighted by its PE ra-tio. Whatever the methodology, the more heavily weighted a stock the greater the effect a one riyal move-ment in its price will have upon the index return (when compared to smaller weighted stocks). More in-formation on QSE’s index rulebooks and methodologies can be found at www.qe.com.qa

The advantages of ETFs are that they can be bought and sold intra-day, they’re cheaper than other ac-tively managed funds and they can provide exposure to securities that might otherwise have been difficult to invest in. A time may come where QSE lists ETFs based on securities whose primary listing is overseas. ETFs bring convenience to the in-vestor; he may use existing local ar-chitecture (accounts, brokers, order types) to quickly invest in a new and diversified holdings set.

Some key terms related to ETFs:

FUND MANAGER: The firm li-cenced by the relevant regulator to manage the ETF.

CUSTODIAN & ADMINISTRATOR: The bank or institution responsible for holding the assets of the ETF, calculating the Net Asset Value and properly accounting for the creation or redemption of units.

LIQUIDITY PROVIDER OR MARKET MAKER: The firm licensed by the rel-evant regulator to provide liquidity (bids and offers) on the exchange for shares in the ETF.

AUTHORISED PARTICIPANT: A firm which is authorised by the ETF Fund Manager to submit requests for large blocks of shares in the ETF to be created or redeemed (these blocks are called Creation Units).

ETF BASKET OR PORTFOLIO COM-POSITION FILE: Is the group of secu-rities and amount of cash the Au-thorised Participant is required to deliver to the ETF.

NAV: Net Asset Value of the ETF is usually published after market close and may vary from the last trade price on the exchange.

INAV: The price of the shares noted in the ETF Basket or Portfo-lio Creation File multiplied by the current market price. This iNAV or indicative-NAV is usually published as part of the exchange market data feed or through Bloomberg, Reuters and other financial data portals.

ETF units have an official end of day valuation called the Net Asset Value (NAV). The NAV is the sum of all the fund’s assets (the value of its holdings in e.g. cash, shares, bonds, and other securities) less any liabilities, all divided by the number of units outstanding. The NAV for ETFs listed at QSE will be published by 6pm and is available on its web-site and via data vendor screens such as Bloomberg and Thomson Reuters.

One of the liabilities upon the fund is its total expense ratio (TER). This is the measure of the total costs associated with managing and op-erating an ETF and is expressed as an annual percent (eg 0.5 percent). The TER is accrued daily and is re-flected in the NAV of the ETF. Full audited annual and semi annual financials will be published by the fund’s website together with quar-terly performance reports.

The job of the fund manager is to ensure the ETF replicates the per-formance of the index. While varia-tions tend to be small, the difference between a fund’s return and the in-dex’s return, often called tracking error, can sometimes be significant.

The total expense ratio is a fee not applied at the index level so this is often cited as a primary cause of tracking error. Other reasons in-clude illiquidity and transaction costs.

The fund manager need execute rebalance trades as close to the clos-ing price of the security as possible in order to be in line with the index value. The index does not assume brokerage or exchange fees when it rebalances its components twice a year also. Another cause could be something called ‘cash drag’ – as an example some ETFs may hold dividends as cash and then make a distribution periodically. This in-creased cash position relative to the index could create periods of over or under performance.

In addition to rebalancing the ETF in line with any index changes, the fund manager should replicate the corporate action treatment of the index – paying particularly at-tention to price adjustments and inclusions of new shares.

From a trading perspective the fund manager should try to the shadow the methodology of the index at all times. If the index is a total return index i.e. it assumes the

dividends distributed by compo-nents are reinvested, then the fund manager must quickly reinvest an underlying dividend across the bas-ket at the same point that the index adjustment is made.

Dividend reinvestment for the fund manager involves executing buy orders in each of the index com-ponents. Dividend reinvestment can boost the total return of an invest-ment portfolio through the effect of compounding the accumulated income over time (often called the ‘snowball effect’).

By reinvesting the dividend pay-ments into additional shares the fund should benefit the next year by also earning dividends on these re-invested shares. The alternative is to make dividend distributions.

If an ETF is benchmarked to the price return index it will usually dis-tribute a dividend to the ETF unit holders. The frequency with which an ETF will make the dividend dis-tribution depends on the underly-ing dividend schedule of its compo-nents, the cost of making dividend payments and the ability of the fund manager to manage any ‘cash drag’.

A price return index purely re-flects the market price of stocks without accounting for dividends paid by those shares in the index. For example an ETF using a QE price return index the dividend dis-tribution of their components could occur up to 20 times.

However, at the ETF level it may

not be practical or economical to make 20 payments to unit holders and instead the fund manager will hold the dividends in the ETF, they will be included in the ETF NAV, and then may declare one dividend distribution date for the ETF at the end of the dividend season for the underlying components. Opera-tionally this is repeated throughout the dividend season and some track-ing error would be observed until the dividend distribution is made and the ETF NAV falls back in line with the index.

To qualify for the distribution in the scenario described above the unit holder should have purchased their position in the ETF on or be-fore the record date.

The following trading day the ETF will trade without entitlement to its dividend and the NAV should drop by that dividend amount, as anyone that buys the ETF on that date will not be entitled to the divi-dend. While it might seem like a good idea to buy the ETF immedi-ately prior to the distribution, this is actually not true, as we’ve seen that the NAV adjusts downward after the record date and any gain would be offset.

If the ETF does see significant inflows (requests for new units to be created by the Liquidity Provider or Authorised Participant) prior to the dividend does it mean that investors that bought the ETF months earlier would receive a smaller dividend

than before? Usually ETF’s implement vari-

ous measures to protect the enti-tlements of shareholders in terms of dividends and corporate actions, some ETF’s with a high dividend yield may distribute dividends more frequently, others may restrict the amount of creation/redemption around their anticipated dividend date.

Another way ETF’s may protect their investors dividends is by im-plementing a ‘Dividend Equivalent Payment’ as part of the daily ETF Basket or Portfolio Composition File. This payment would need to be made by any investor subscrib-ing during certain periods when shares held by the ETF have traded past their record date but the ETF has not yet distributed its dividend In fact this method is the standard used by some of the largest ETF’s in the world.

Liquidity Provider (LP)The role of the LP is to facilitate

the ETF buy and sell demand that comes through the exchange. The LP will place bid and ask orders for the ETF units throughout the trad-ing session usually aiming to mini-mise the spread between bid and offer as much as possible.

The price at which the LP offers to buy and sell units is built around the Indicative Net Asset Value (iNAV), which is an intraday indica-tive value of an ETF based on the real-time market prices of its under-lying constituents.

At QSE you would see this value on the Marketwatch and/or order-book section of its website, as well as via data vendor screens. iNAV allows the investor to view the ‘fair value’ of the ETF unit. In terms of execution the investor may use market or limit orders. If the price offered is in line with the iNAV and you enter a market order you’ll re-ceive ETF units as per offers posted by the LP. However if you want to wait, enter a limit order and see if the inherent value of the ETF reduc-es to the point at which you’re will-ing to execute you may do that. Divi-dend treatment and other corporate action handling is all built into the iNAV and the LP will continue to quote a bid/ask spread around the ETFs true tick-by-tick value.

The LP is also an Authorised Participant (AP) able to create and redeem ETF units directly with the fund based on the end of day NAV in large blocks called Creation Units.

In order to satisfy demand for ETF units the AP will purchase and compile the underlying shares ac-cording to specified weights, which are posted by the Fund Manager on a daily basis, and deliver these to the fund in exchange for ETF units.

Similarly, the AP may redeem ETF units once a certain size is met (a ‘Creation Unit’) and the fund will deliver the underlying shares in re-turn, again in-line with the daily Portfolio Composition File or ETF Basket posted by the Fund Manager.

This unique process helps keep the ETF price on the exchange aligned with the intrinsic value of the ETF unit. It is also an extraor-dinarily efficient way for the ETF to gain new assets - while the ETF incurs trading fees to rebalance in line with the index twice a year, it is the LP and AP who incur the cost of assembling the basket in line with the index weights and delivering to the fund as demand for an ETF grows.

The Qatar Stock Exchange building in Doha

All you need to know about ETFs

TRIBUNE NEWS NETWORKDOHA

DOHA Bank CEO Dr R Seetharaman has been hon-oured with the “Award of Ex-cellence” by the Sri Lankan government in recognition of his services.

The award was presented to Seetharaman by HE ASP Liyanage, the Sri Lankan Am-bassador to Qatar, at an event to mark Sri Lanka’s 70th An-niversary of Independence in Doha recently, Doha Bank said in a press statement on Sun-day.

The award recognises the support extended by Seethara-man for promoting bilateral trade and investment relation-ships between Qatar and Sri Lanka, the statement added.

Doha Bank has been ex-tending credit lines to Sri Lankan banks, and has also received approval for opening representative office in the Sri

Lankan capital of Colombo, and is set to commence its op-erations soon.

Seetharaman said, “In-ternational Monetary Fund (IMF) expects Sri Lanka to report GDP growth of 4.8 per-cent in 2018. Diplomatic rela-tions between Sri Lanka and Qatar persists since 1976.

"In recent times Sri Lan-ka’s imports from Qatar have primarily been polymers of ethylene and Sri Lanka’s ex-ports to Qatar were mainly ba-nanas followed by food prepa-rations, tea, and vegetables."

He continued, "Sri Lanka can support Qatar in food, while Qatar can continue to support Sri Lanka in polymers.

"Sri Lanka is keen on seek-ing Qatari investment in tour-ism, power and health sectors. Sri Lanka has enjoyed close ties with Qatar, with over 120,000 Sri Lankans making up for close to 2.7 million population of Qatar.”

Sri Lanka honours Doha Bank CEO

Doha Bank CEO Dr R Seetharaman (centre) receives the ‘Award of Excellence’ in the presence of top Sri Lankan officials at an event in Doha recently.

Seetharaman played key role in promoting bilateral trade between Qatar and Sri lanka

QATAR STOCK EXCHANGE’S KEY INFO ON EXCHANGE TRADED FUNDS

Mondrian Doha to open WalimaTRIBUNE NEWS NETWORK

DOHA

MONDRIAN Doha, Qatar’s hottest destination from glo-bal lifestyle hospitality com-pany sbe, has announced the upcoming opening of Walima, the property’s newest restau-rant which showcases Qatari hospitality with a modern twist.

Set to open its doors on February 28, Walima is a cel-ebration of Qatari heritage and authentic local flavours, as well as embracing Arabic influences from around the re-gion, a press statement said on Sunday.

Walima is the seventh culi-nary and entertainment venue to open at the Marcel Wanders designed hotel, joining world-class concepts such as CUT by Wolfgang Puck, Morimoto, Hudson Tavern, Magnolia Bakery, RISE and Black Or-chid.

An opening celebration for

Walima was held on Tuesday 6th February, 2018.

Executive Chef, Simon John Winchester for Mon-drian Doha said, “Embodying the local culture in all of its elements, Mondrian Doha is at the core of the Qatari tra-ditions reflecting the art of the true Arabian hospitality. It is the secret ingredient that makes Walima so special for its ability to blend local and international flavours in its distinguished offering.”

Economy & Business

TRIBUNE NEWS NETWORKDOHA

THE Ministry of Develop-ment Planning and Statistics (MDPS) has released the 22nd issue of the quarterly publica-tion “Window on Economic Statistics of Qatar”. The ref-erence quarter of this issue is the third quarter of 2017 (Q3 2017).

The latest available macro-economic indicators, relating

to national accounts, prices, public finance, and the balance of payments have been assem-bled in a single report, a press statement said on Sunday.

“It is a very handy report and is meant to help diverse users, in particular, policy and decision makers,” the state-ment added.

The publication compris-es three parts. The first part presents a dashboard compar-ing the economic performance

of Qatar with other economies and regions, in terms of three indicators: real GDP annual growth rate, consumer price index (CPI) change, current account balance as percentage of GDP, and data series (quar-terly and annual) on thirty economic indicators.

The second part consists of an analysis of the quarterly statistics relating to GDP, CPI, producer price index (PPI), exports and imports and com-

pares the performance in the Q3 of 2017 with that of the corresponding quarter of 2016 and, with that of the previous quarter (Q2, 2017).

The third part contains articles on specific topics. The title of the article presented in the issue is “Performance of Building and Construction Sector in Qatar, 2012-2016”.

The article discusses the performance of building and construction sector in Qatar

during the period 2012-2016 in terms of its contribution to GDP, recruitment of the work-force and its share in domestic credit.

Furthermore, the article also tackles the methodology and procedures of collecting and compiling data as well as a brief analysis through fol-lowing up the developments in the value added generated, its growth rates and the affecting factors behind.

MDPS unveils ‘Window on Economic Statistics of Qatar’ quarterly issueThe latest available macro-economic indicators relating to national accounts, prices, public finance, and the balance of payments have been assembled in a single report

QNB Group has mandated CI Capital in Egypt to advise on the necessary action to sell approximately 2.1 percent of QNB Group’s stake in QNB ALAHLI, Egypt, to reach approximately 95% after the sale, in order to comply with the free float requirements of the Egyptian Stock Exchange (EGX) and the requirements of other concerned local regulators, the bank said in a press statement on Sunday. QNB Group’s current shareholding in QNB ALAHLI amounts to 97.12 percent. (TNN)

THE State Audit Bureau has launched the hashtag #supervi-sion to promote the culture of supervision among all parties and individuals in the community, in addition to involving individuals in the supervisory process.By launching the hash-tag, the Bureau seeks to highlight the concept of supervision among future generations and establish the principle of main-taining public money as a national duty, a press statement said on Sunday. (QNA)

QNB mandates CI Capital to sell 2.1 % stake in ALAHLI Egypt

State Audit Bureau launches hashtag to promote culture of supervision

News in brief

Mar-Apr LNG spot price spread may tighten on supply outlookREUTERSSINGAPORE

ASIAN spot liquefied natural gas (LNG) prices for April delivery showed a steep discount to March prices but the spread could tighten due to falling U.S. output, low South Korean inven-tory levels and buyers delaying pur-chases.

Spot prices for April delivery in Asia were assessed at $7.90 per mil-lion British thermal units (mmBtu) this week.

Declining feed-gas supply at Cheniere Energy’s Sabine Pass liq-uefaction plant in Louisiana may squeeze exports and lift Asian prices if production suffers for an extended period of time.

Some traders linked the cut in gas flows to news earlier this week that federal regulators ordered Cheniere

to shut two of the plant’s five storage tanks which leaked the super-cold fuel.

An ongoing investigation was looking into whether the three oper-ating tanks had also leaked. Cheniere did not return requests for comment.

Production from Peru LNG re-mained offline into its second week but repairs to a burst pipeline feeding the plant were at an “advanced stage” and should resume by the end of this week.

There were also recent reported production glitches affecting Indo-nesia’s Bontang facility and Qatargas Train 2.

Traders suggested the steep back-wardation between March and April may narrow as low stored reserves could force Korea Gas Corp to tap spot markets for additional supply over coming months.

Buyers may also push purchases of LNG from March into April given the savings on offer, further narrowing the price gap.

The Chinese New Year holidays

dampened spot market activity with the highlight of the week being the tender awards from Russia’s Sakhalin II plant and purchases by Argentina’s Enarsa, traders said.

Royal Dutch Shell picked up a sig-nificant portion of the eight cargoes sold by Sakhalin II over the March 2018-May 2019 period, traders said.

With the exception of China, cold weather prevailed across much of Asia, while areas of the Middle East experienced a hot streak, both sup-portive of gas demand.

A cold wave was also expected to hit north-west Europe next week.

Kuwait sought a March cargo and Jordan a April delivery.

GAIL India sought two March de-liveries.

Angola meanwhile offered one cargo loading in February and another in late March-early April via tender.

19Monday, February 19, 2018

CARREFOUR Qatar is celebrating a major milestone in reaching 300,000 MyCLUB members in less than a year, a press state-ment said on Sunday. MyCLUB is Carrefour’s bespoke loyalty programme and the first of its kind in the Middle East’s retail sector. Since its launch in April 2017, Qatar’s MyCLUB users have been rewarded with more than 140,000 vouchers valued at QR7 million. MyCLUB offers personalised discounts and regular promotions based on members’ shopping habits.

“Carrefour warmly thanks its ‘MyCLUB’ members for their trust and loyalty towards the brand and invites everyone to benefit from its digital loyalty programme by downloading the Carrefour Qatar application and registering for ‘MyCLUB’,” the statement said. (TNN )

Carrefour’s MyCLUB loyalty programme reaches 300,000 members in Qatar

TOTAL-LED international consortium (Total 40 percent, ENI 40 percent, Novatek 20 percent) and the government of Lebanon have signed two exploration and production agreements cover-ing Blocks 4 and 9 located offshore Lebanon, in the eastern part of the Mediterranean Sea. These agreements provide for the drilling of at least one well per block in the first three years, Total said in a press statement on Sunday.

“An established player in Lebanon’s marketing sector, Total is delighted to expand its presence in the country to the exploration and production segment. These agreements are part of the Group’s exploration strategy in the Mediterranean region”, said Stephane Michel, Senior Vice-President, Middle East and North Africa, Exploration & Production at Total. The consortium’s priority will be to drill a first exploration well on Block 4 in 2019. (TNN )

Total strengthens its position in the Mediterranean with Lebanon deal

Qatar Chamber Vice-President Mohammed bin Ahmed bin Tawar al Kuwari and Turkish Ambassador Qatar HE Fikret Ozer, opened the ‘Tourism in Turkey’ workshop in Doha on Saturday. (TNN)

‘TOURISM IN TURKEY’ WORKSHOP OPENS IN DOHA Qatar stock index gains 51.72 points

QNA DOHA

QATAR Stock Exchange (QSE) index gained 51.72 points (0.57 percent) when the bourse closed trading at 9,079.43 points on Sunday.

The volume of shares traded decreased to 7,018,500 from 7,296,278 and the value of shares decreased to QR169,696,958.81 from QR287,331,548.56.

From the 45 companies listed on QSE, shares of 41 saw trading. From these, 30 gained, 9 closed lower, and two remained unchanged.

Indices of all sectors ended in green. QSE Total Return Index gained 0.57 percent to 15,329.37 points and QSE Al Rayan Islamic Index increased 0.61 percent to 3,696.26 points. QSE All Share Index added from 0.62 percent to 2,530.74 points.

Iran eyeing Iraqi flour market via Russia wheat deal

REUTERS DUBAI

IRAN is negotiating a wheat import deal with Russia that would allow it to increase flour exports to neighbouring Iraq, the secretary general of the Iran Federation of Food Indus-try Associations told Reuters on Saturday.

The deal would involve importing around 100,000 tonnes of Russian wheat per month for private millers who would then produce flour for export.

Kaveh Zargaran said talks were ongoing and he expected the deal to be finalised in a couple of months.

“Last week we were in Moscow to negotiate about it and after we are done we will start in a few months,” Zarga-ran said.

“We have a little financial problem to resolve but after it we will be able to go through with the deal,” he said without elaborating.

The Eurasian Economic Commission, an organization for a free customs zone which Russia shares with its neigh-bours, is leading the nego-tiations, a member of the talks later confirmed to Reuters.

Arkady Zlockevsky, head of

Russia’s Grain Union, a non-state farmers’ lobby group, said the talks were part of broader negotiations about a free trade zone between Iran and Russia. Russian private firms are con-sidering wheat supplies to Iran as part of the talks, he said.

“Russia is ready to start supplies in the nearest days. The question is on the Irani-an side and how quickly their firms will manage to adapt to the processing regime, because Iran was not buying our wheat since March 2016,” Zlock-evsky, who is taking part in the talks, said.

Iranian private millers are not allowed to use domestic wheat for flour exports.

Russia, among the world’s largest wheat exporters, has ample supplies waiting for the deal. “They are negotiating with the Iranian private sec-tor,” Zargaran said.

Iraq’s flour imports are currently dominated by Turk-ish supplies.

“It will be difficult for Ira-nian flour to compete because of the kind of quality of Turk-ish flour which the Iraqis are used to, that is why they have to import high-protein Rus-sian wheat in order to make flour that will sell in Iraq,” an industry source said.

Economy & Business

IANSSAN FRANCISCO

GOOGLE did not violate la-bour laws when it fired James Damore, a former employee who was ousted from the com-pany last year for criticising the tech giant for its diversity policy, according to the US federal agency that oversees

employment practices. “Employers must be per-

mitted to ‘nip in the bud’ the kinds of employee conduct that could lead to a ‘hostile workplace,’” a lawyer with the US National Labor Relations Board (NLRB) wrote in an agency memorandum made public this week, CNET re-ported.

Damore’s memo, titled “Google’s Ideological Echo Chamber”, claims that when it comes to technology, there is a biological differences between men and women. Before his firing, Damore had filed a complaint with the NLRB that charged Google with “misrep-resenting and shaming me in order to silence my com-plaints”.

But the NLRB lawyer said Google fired the computer en-gineer not for expressing dis-senting views or criticism, but over “unprotected discrimina-tory statements” in his memo,

which he had posted to inter-nal discussion forums at the tech giant.

“Employers have a strong

interest in promoting diversi-ty and encouraging employees across diverse demograph-ic groups to thrive in their

workplaces,” attorney Jayme Sophir wrote in the memoran-dum.

“The statements regarding biological differences between the sexes were so harmful, discriminatory, and disrup-tive as to be unprotected,” Sophir stated.

Damore withdrew the NLRB complaint last month to focus on a lawsuit against Google. In his lawsuit filed in a California court, Damore said that Google “ostracised, belittled and punished” him and a fellow plaintiff.

He added that he and oth-

ers who share his views at Google long have been “sin-gled out, mistreated, and systematically punished and terminated from Google, in violation of their legal rights”.

Google CEO Sundar Pichai had said he did not regret fir-ing Damore.

When asked about Goog-le’s decision to fire Damore during an interview with MSNBC last month, Pichai said: “I don’t regret it. It was the right decision.

“The last thing we do when we make decisions like this is look at it with a political lens.”

Google’s firing of anti-diversity memo author legal: US labour board

REUTERS

US semiconductor company Qualcomm Inc should try to negotiate a sale to Broad-com Ltd following the latter’s sweetened $121 billion offer, proxy advisory firm Institu-tional Shareholder Services Inc (ISS) said.

Qualcomm has been seek-ing to walk a fine line between resisting Broadcom’s acquisi-tion approach, which it says undervalues it and is fraught with regulatory risks, and demonstrating to sharehold-ers and proxy advisory firms such as ISS that it is willing to engage to secure a better deal if possible.

In a report published late on Friday, ISS recommended to Qualcomm shareholders that they vote for four out of the six board director nomi-nees that Broadcom has put forward for election at Qual-comm’s shareholder meeting on March 6.

While this recommenda-tion would fall short of Broad-com’s nominees winning a majority on Qualcomm’s 11-member board, ISS said such a vote by Qualcomm shareholders would offer a rea-sonable path to a negotiated deal that would deliver value.

“The tenor of (Qual-comm’s) engagement leading up to the present raises ques-tions as to whether the incum-bent (Qualcomm) board is committed to playing its part in attempting to maximize the offer,” ISS said in its report.

Broadcom first unveiled an unsolicited $70 per share cash-and-stock offer in November, which Qualcomm rejected. It raised its offer to $82 per share in cash and stock on Feb. 5 and offered other concessions, in-cluding paying an $8 billion breakup fee in the event regu-lators thwart the deal, which would be the technology sector’s largest-ever acquisition.

ISS said it did not recom-

mend voting for all six Broad-com nominees because Qual-comm’s board would then be less inclined to drive a hard bargain with Broadcom in deal negotiations. ISS recommended that Broadcom nominees Samih Elhage, Julie Hill, John Kispert and Harry You should be elected as Qualcomm board directors.

Qualcomm on Friday called a Feb. 14 meeting with Broadcom constructive and opened the door to more talks, but continued to reject the proposed deal.

As of Saturday afternoon, no new meeting between the two companies had been scheduled, according to peo-ple familiar with the matter. Broadcom and Qualcomm representatives offered no im-mediate comment.

The takeover battle is at the heart of a race to consoli-date the wireless technology equipment sector, as smart-phone makers such as Apple Inc and Samsung Electronics Co Ltd use their market domi-nance to negotiate lower chip prices.

Singapore-based Broad-com is mainly a manufacturer whose connectivity chips are used in products ranging from mobile phones to servers. San Diego-based Qualcomm pri-marily outsources the manu-

facturing of its chips which are used for the delivery of broad-band and data, a business that would significantly benefit from the rollout of 5G wireless technology.

ISS said in its report that Broadcom’s latest $82 per share cash-and-stock bid, which Broadcom CEO Hock Tan has called its best and fi-nal offer, does not appear to be clearly superior to Qual-comm’s potential standalone value in the short term. ISS added, however, that the offer seemed to represent a reason-able starting point for negotia-tions.

Even though both compa-nies “have adopted strategies that do not lend themselves to fluid negotiations,” a deal between them is possible, ISS said. It suggested that Qual-comm shareholders could gain greater exposure to the deal’s potential upside if they were to receive more of the combined company.

Qualcomm should negotiate sale to Broadcom, says ISS

One of many Qualcomm buildings is pictured in San Diego, California. (REUTERS/FILE)

In his memo, James Damore had said that when it comes to tech, there are biologi-cal differences between men and women

The proxy advisory firm recommends the US semiconductor company to grab Broadcom’s $121 bn offer

India’s City Union Bank suffered hack via SWIFT system

REUTERSMUMBAI

INDIA’S City Union Bank said on Sunday that “cyber criminals” had hacked its systems and transferred nearly $2 million through three unauthorized remit-tances to lenders overseas via the SWIFT financial platform.

The comments come af-ter the small private lender on Saturday had disclosed it had discovered the three “fraudulent remittances”, which were sent via corre-spondent banks to accounts in Dubai, Turkey and China.

Chief Executive Officer N. Kamakodi called it a “conspiracy” involving mul-tiple countries, and added the lender was still investi-gating how it had happened.

“This is basically a cyber attack by international cy-ber criminals,” he told Reu-ters in a phone interview.

Kamakodi added they saw “so far no evidence of any internal staff involve-ment,” but said “we are very clear now the account holders are part of this con-spiracy.”

The disclosure from City Bank comes as India has been gripped by an announcement by Pun-jab National Bank earlier this week that it had been the victim of a $1.7 billion fraud, although that case is suspected to involve the transfer of unauthorized loans from bank employees.

City Union said on Sat-urday it had been able to

block one of the remittanc-es, totaling $500,000, that was being sent through a Standard Chartered Bank account in New York to a Dubai-based lender.

A second transfer of 300,000 euros ($372,150) was routed through a Standard Chartered Bank account in Frankfurt to a Turkish account, although the Turkish lender had blocked the transfer from being finalised.

A third totaling $1 mil-lion was sent through a Bank of America (BAC.N) account in New York to a China-based bank, which Kamakodi on Sunday iden-tified as Zhejiang Rural Credit Cooperative Union in Hangzhou, China.

Kamakodi said the lend-er was working with Indian authorities to work with affected countries to inves-tigate what happened. He added City Union was also strengthening its internal monitoring systems.

Brussels-based SWIFT has been urging banks to bolster security of comput-ers used to transfer money since Bangladesh Bank lost $81 million in a February 2016 cyber heist that target-ed central bank computers used to move funds.

Banking security ex-perts said Indian banks that rely on the SWIFT messag-ing platform needed to be more vigilant. Industry ex-perts say more than 100 fi-nancial institutions in India are connected with SWIFT including the central bank.

The lowdown Though Qualcomm has

rejected Broadcom’s initial buyout offer, Broadcom has a pretty good sales pitch for Qualcomm investors. It also has options for appeasing regulators and customers

With Qualcomm shares now trading less than $4 below Broadcom’s offer price, markets are betting Broadcom will be able to strike some kind of deal

Employers must be permitted to ‘nip in the bud’ the kinds of employee conduct that could lead to a ‘hostile workplacea lawyer with the US National Labor Relations Board

Careem acquires M-E online restaurant listing platform, to trial food delivery

REUTERSDUBAI

CAREEM, a Middle East competitor to Uber Tech-nologies, said on Sunday it had acquired RoundMenu and would start trialing food delivery services through the restaurant listing and reservation online platform this month.

The Dubai-based ride hailing firm acquired the website and app for an un-disclosed sum.

“Careem will begin testing a delivery capability for RoundMenu customers on a small scale later this month,” it said in a state-ment to Reuters.

RoundMenu has a pres-ence in 18 cities across nine

Arab countries, including Saudi Arabia, the United Arab Emirates, and Egypt,

according to its website.There is demand for

delivery services in the

Middle East, particularly in the Gulf Arab states where temperatures can soar above 50 degrees in the summer.

Several food delivery companies, including Tala-bat, Zomato, UberEats, and Deliveroo, are active in the region.

RoundMenu has raised $3.1 million in funding since it launched in 2012, the Careem statement said.

Careem said in June it would accelerate expansion plans after raising $500 million from investors, including German carmaker Daimler and Saudi Arabia’s Kingdom Holding.

In July, it took a minori-ty stake in an Egyptian start-up that connects commuters with private buses in Cairo.

An employee shows the logo of ride-hailing company Careem on his mobile in his office in Ramallah. (REUTERS)

FROM ROAD TO HEART, THROUGH MOUTH

A man using a mobile phone passes the logo of global secure financial messaging services cooperative SWIFT

Software may have helped Daimler pass US emissions tests: Report

REUTERSBERLIN

US investigators probing Mercedes maker Daimler have found that its cars were equipped with software which may have help them to pass diesel emissions tests, a Ger-man newspaper reported on Sunday, citing confidential documents.

There has been growing scrutiny of diesel vehicles since Volkswagen admitted in 2015 to installing secret software on 580,000 US vehicles that al-lowed them to emit up to 40 times legally allowable emis-sions while meeting standards when tested by regulators.

Daimler, which faces on-going investigations by US and German authorities into excess diesel emissions, has said investigations could lead to significant penalties and re-calls.

The Bild am Sonntag news-paper said that the documents showed that US investigators had found several software functions that helped Daim-ler cars pass emissions tests, including one which switched off emissions cleaning after 26 km of driving.

Another function under scrutiny allowed the emissions cleaning system to recognize whether the car was being tested based on speed or accel-eration patterns.

Bild am Sonntag also cited emails from Daimler engi-neers questioning whether these software functions were legal.

A Daimler spokesman de-clined to comment on the con-tent of the documents, saying the German company was ful-ly cooperating with the US au-thorities and had agreed upon strict confidentiality with the Department of Justice.

“The authorities know the documents and no complaint has been filed,” the spokes-man said.

“The documents available to Bild have obviously selec-tively been released in order to harm Daimler and its 290,000 employees.”

Daimler CEO and Head of Mercedes-Benz Dieter Zetsche

Economy & Business20 Monday, February 19, 2018

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REUTERSSAN FRANCISCO

SOME potential buyers of Tes-la’s long-delayed Model 3 se-dan are concerned that they will miss out on big federal tax breaks and are looking for

alternatives, including General Mo-tors Co’s Chevrolet Bolt, according to postings by would-be Tesla buy-ers on websites and interviews with GM dealers.

Last week Tesla told some hold-ers of Model 3 reservations that they would not get their cars until 2019, eliciting howls of complaint on Tesla online fan forums. Tesla declined to comment.

GM dealers in California, the top US market for electric vehicles, say brisk demand for Bolts is driven in part by frustrated Tesla buyers who are afraid they will lose a $7,500 electric vehicle tax credit if they wait. The tax credit drops in value and eventually disappears once Tes-la sells 200,000 electric vehicles in the United States, which Edmunds analyst Jeremy Acevedo expects Tesla to hit by the fall.

Tesla’s Model 3 production trou-bles give rival auto makers a chance to snatch customers. Tesla has said that the net number of refundable $1,000 reservations for Model 3s was stable late last year and grew in recent weeks, with hundreds of thousands in line. But some buyers are running out of time or patience.

Chevrolet dealer Yev Kaplinskiy said his dealership located between San Francisco and Silicon Valley sold 15 Bolts last weekend, after Tesla’s latest delay.

“We’re getting the Tesla people who wanted their Model 3,” Kaplin-skiy said. “We ask them, ‘What other cars are you interested in?’ They’re mostly Tesla. But they want the car now. They don’t want to wait.” Some of the weekend buyers had turned to Chevy because of the most recent Tesla delay, he said.

Chevrolet sent an email to some prospective buyers this week, an-nouncing in bold case, “Bolt EV: Now available.”

The Bolt and Model 3 both start at about $35,000 and can travel more than 200 miles (322 km) on an electric charge, although the Tes-la and its Chief Executive Elon Musk have received much more media at-tention.

While Tesla is struggling with production of the Model 3, GM sold 23,297 Bolts in 2017, with monthly sales mostly rising. Kelley Blue Book reported that Bolts are in relatively short supply as measured by days in inventory, which fell to 42 in January from a high of 65 in August. By comparison, the Nissan Motor Co Ltd Leaf, an electric car with shorter range, was in inventory for 202 days.

Last Wednesday, some of those

who made early reservations for the base version Model 3 received emails from Tesla saying their ve-hicles would not be delivered until early 2019, delayed from 2018.

“I‘m feeling extremely fleeced by Elon - guy secured an interest free loan from me (reservation payment)

for a car I hadn’t seen before reserv-ing, and just told me that it might be another year before I should receive it,” wrote one person from Seattle, “206er”, who was among a hand-ful on TeslaMotorsClub.com saying they were cancelling reservations after the new delay.

Reuters was unable to contact the posters or confirm that they were cancelling reservations.

“My objective...was always a $35,000 Tesla for the price of a de-cently optioned Civic (with full fed-eral tax credit),” 206er added.

Tesla is closing in on 200,000

US electric vehicle sales thanks to the popularity of its luxury Model S sedan and Model X SUV. If it hits 200,000 US electric vehicle sales in the third quarter, then the $7,500 tax credit would phase out in stages over 2019. GM also is get-ting close to the limit, having sold nearly 170,000 plug-in cars, includ-

ing Bolts, Volts and others, through the end of last year, Green Car Re-ports estimated. Sonoma Chevrolet General Manager Ken Scholl, said the subsidy had been a key draw for Bolts and a concern for those who had given up on a Tesla. “If I had 50 (Bolts) in December, we would have sold every one,” he said.

A Chevrolet Bolt EV electric vehicle is displayed at the North American International Auto Show in Detroit. (File photo) ( REUTERS)

The Bolt and Tesla’s Model 3 both start at about $35,000 and can travel more than 200 miles (322 kilometres) on an electric charge. While Tesla is struggling with production of the Model 3, GM sold 23,297 Bolts in 2017, with monthly sales mostly rising

Tesla delays, tax credit concerns spur sales of GM’s Chevy Bolts

REUTERSCARACAS

WIDERVEN Villegas and his brother wash some 30 cars a day at a parking lot in Ca-racas. Despite charging less than 50 cents, nobody pays them in cash.

In tech hubs from San Francisco to Tokyo, payment is conveniently made through software on phones and watches on a routine basis. Amid a dire economic crisis in Venezuela a similar inno-vation is taking hold, though for very different reasons.

People from vegetable sellers to taxi drivers have registered to use mobile pay-ment applications to attract customers who do not have enough paper money, which is in short supply due to soaring prices.

The maximum daily amount Venezuelans can withdraw from cash ma-chines is around 10,000 bo-livars, around 4 cents at the

black market exchange rate.Venezuela's hyperinfla-

tion, one of the first of the digital era, is producing surprise winners in a tough business climate: small tech-nology companies based in the crisis-stricken country.

"I accept transfers. I have Tpago, Vippo and al-most all the applications out there!" said Villegas, 35, as he clutched a worn-out tab-let and a basic cellphone.

"We don't handle cash because our clients don't have it," he added. "With the applications I use, I've got their money before they've even left the parking lot."

Without these apps, even simple transactions like tip-ping a waiter or paying for parking become nightmares. Still, banking websites and mobile apps often crash, as the outdated telecoms infra-structure cannot cope with surging demand.

Requests for a taxi on the Nekso application, some-

what similar to Uber, dou-bled last year, according to its head of strategy Leon-ardo Salazar, speaking at the company offices that boast a Playstation console and ping pong table.

Vippo, a Caracas-based payment app, saw a more than thirty-fold increase in the number of people regis-tering last year. Citywallet,

born as a pilot project for online parking payments at a private university, was ex-tended to several shopping centres.

"The cash crisis is getting worse every day but is giving us the opportunity to cap-ture more and more transac-tions with our solution," said

Citywallet co-founder Atilana Pinon, 29.

She and two partners set up the app which is now ex-panding to Chile, after win-ning a scholarship from its government.

Creating an app in Ven-ezuela usually requires little capital, given low salary ex-

pectations from coders and near-free electricity and data costs.

Developers were sur-prised by the rapid adoption of the applications and are betting on further growth in 2018.

"There are times when the point of sale machine stops working," said Maria Lozada, selling cleaning products at a market stall in the wealthier Caracas district of Chacao. "This is the way to solve the cash crisis," she says, pointing to a Vippo sign.

Venezuela's central bank inadvertently buttressed the boom by slowing cash produc-tion just as inflation was spi-ralling into quadruple digits.

At the end of 2017, the vol-ume of banknotes increased by only 14 percent, less than half from a year earlier. That coincided with price rises of more than 2,500 percent, ac-cording to National Assembly figures.

Some 18 private Venezue-

lan banks last year launched an electronic payment app for consumers. MercadoLibre, one of the largest online com-merce companies in Latin America, also offers a local payment solution.

Even leftist President Nico-las Maduro is getting in on the act, although critics blame him for the root problem.

"With the digital wallet we are going to perform miracles at all levels," Maduro said re-cently, announcing a QR code to be included on the govern-ment's social welfare identifi-cation card.

Despite some of the world's lowest internet speeds and a significant fraction of the population without bank accounts and cellphones, cash is falling out of favor in Ven-ezuela.

"Perhaps our economy will be cash-less before Den-mark," quipped Miguel Leon, an electronic engineer leading Vippo, in his open office fea-turing hammocks.

Cash-scarce Venezuela sees boom in payment apps

A point-of-sale (POS) device is seen in a fruit and vegetables stall at Chacao Municipal Market in Caracas, recently. (REUTERS)

Economy & Business

A Tesla Model 3 sedan is displayed during its launch in Hawthorne, California. (REUTERS)

WHEN HYPERINFLATION MEETS TECH

Cashless shopping People from vegetable sellers to taxi drivers have registered to use mobile payment applications to attract customers who do not have enough paper money, which is in short supply due to soaring prices

22 Monday, February 19, 2018