UAE carrier Air Arabia lays off more staff due to COVID-19 impact

Air Arabia, like other airlines in the UAE, has operated few, limited services since grounding passenger flights in March. (Courtesy Air Arabia)
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Updated 03 June 2020

UAE carrier Air Arabia lays off more staff due to COVID-19 impact

  • Latest job cuts were a ‘last alternative’ for Sharjah-based airline
  • Air Arabia’s profit fell by 45 percent in the first quarter

DUBAI: Air Arabia, the only listed carrier in the United Arab Emirates, has made further job cuts due to the business impact of COVID-19, a spokesman said on Wednesday.
The Sharjah-based airline, which has about 2,000 employees, did not say how many employees had been affected. It laid off 57 employees in May.
The latest job cuts were a “last alternative” after the airline took a series of steps in past months to protect jobs, the spokesman said, without elaborating.
Air Arabia, like other airlines in the UAE, has operated few, limited services since grounding passenger flights in March.
It is not clear when normal operations will resume.
Air Arabia’s profit fell by 45 percent in the first quarter, which the airline blamed on the coronavirus pandemic which has crushed global travel demand.
Air Arabia also operates out of UAE’s Ras Al Khaimah emirate and has bases in Egypt and Morocco.


$8bn blow to Erdogan as investors flee Turkey

Updated 09 July 2020

$8bn blow to Erdogan as investors flee Turkey

  • Overseas holdings in Istanbul stock exchange are at lowest in 16 years

ANKARA: Foreign capital is flooding out of Turkey in a massive vote of no confidence in President Recep Tayyip Erdogan’s economic competence.
Overseas investors have withdrawn nearly $8 billion from Turkish stocks since January, according to Central Bank statistics, reducing foreign investment in the Istanbul stock exchange from $32.3 billion to $24.4 billion.
As recently as 2013, the figure was $82 billion, and foreign investors now own less than 50 percent of stocks for the first time in 16 years.
“Foreign investment has left Turkey for several reasons, both internal and external,” Win Thin, global head of currency strategy at Brown Brothers Harriman, told Arab News.
“Externally, investors fled riskier assets like emerging markets during the height of the coronavirus pandemic. Some of those flows are returning, but investors are being much more discerning and Turkey does not seem so attractive.”
In terms of internal factors, Thin said that Turkish policymakers had made it hard for foreign investors to transact in Turkey. “This includes real money clients, not just speculative.
“By implementing ad hoc measures to try and limit speculative activity, Turkey has made it hard for real money as well. Besides these problems, Turkey’s fundamentals remain poor compared to much of the emerging markets.”
Erdogan allies claim international players are manipulating the Istanbul stock exchange through automated trading, and have demanded action to make it difficult for them to trade in Turkish assets.
Goldman Sachs, JPMorgan, Merrill Lynch, Barclays and Credit Suisse were banned this month from short-selling stocks for up to three months, and this year local lenders were briefly banned by the banking regulator from trading in Turkish lira with Citigroup, BNP Paribas and UBS
JPMorgan was investigated by Turkish authorities last year after the bank published a report that advised its clients to short sell the Turkish lira.
MSCI, the provider of research-based indexes and analytics, warned last month that it may relegate Turkey from emerging market status to frontier-market status because of bans on short selling and stock lending.
With the market becoming less transparent, overseas fund managers, especially with short-term portfolios, are unenthusiastic about the Turkish market and are becoming more concerned about any forthcoming introduction of other liquidity restrictions.
The exodus of foreign capital is likely to undermine Turkey’s drive for economic growth, especially during the coronavirus pandemic when employment and investment levels have gone down, with the Turkish lira facing serious volatility.