Turkey’s Karpowership says it is shutting down power to Lebanon

Lebanon faces the prospect of more power shortages as Turkey’s Karpowership said on Friday it was shutting down supplies over payment arrears. (AP)
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Updated 14 May 2021

Turkey’s Karpowership says it is shutting down power to Lebanon

  • The company provides electricity to Lebanon from two barges
  • Move piles fresh pressure on the battered economy

BEIRUT: Turkey’s Karpowership, which provides electricity to Lebanon from two barges, said on Friday it was shutting down supplies over payment arrears and a legal threat to its vessels as the nation grapples with a deep economic crisis.
The company, which supplies 370 megawatts (MW), or about a quarter of Lebanon’s current supply, told the government this week it would have to shut down unless there were moves toward settling the issues.
The shutdown threatens longer daily power cuts across the heavily indebted nation, which did not have enough capacity to meet demand even before Karpowership’s move on Friday.
Many people in the country, which has seen its currency collapse since a crisis erupted in late 2019, rely on private generators or struggle for many hours a day without power.
“For 18 months we have been exceedingly flexible with the state, continually supplying power without payment or a payment plan, because the country was already facing very hard times. However, no company can operate in an environment with such direct and undue risk,” Karpowership, a unit of Karadeniz, said.
A source familiar with the situation said generators were powered down starting from about 8 a.m. (0500 GMT).
The source, speaking on condition of anonymity, said arrears exceeded $100 million, and said the government had not sought talks to resolve the arrears despite the firm’s repeated appeals to avert a shutdown.
A Lebanese prosecutor threatened this month to seize the barges and fine the firm after Lebanese TV channel Al-Jadeed reported corruption accusations over the power contract. The firm denies the charges.
Lebanon’s Finance Ministry said this week it had received a letter from the Turkish firm with warning, citing a lawmaker saying the country could face “total darkness” if the barges shut off power. It has made no public statement about any talks.
Each of Karpowership’s barges has a capacity of 202 MW, against a contract to supply 370 MW.
An industry source said Lebanon’s total capacity was about 2,200 MW, including the barges, but was only generating 1,300 MW, including the Turkish supplies of 370 MW. Lebanon’s peak demand in 2020 was 3,500 MW, the source said.


Third Jordan-Gulf Economic Forum begins in Amman

Updated 28 September 2022

Third Jordan-Gulf Economic Forum begins in Amman

  • Jordanian minister said value of trade between his country and Gulf Cooperation Council member states reached $6.6 billion in 2021

AMMAN: The third session of the Jordan-Gulf Cooperation Council Economic Forum began in Amman on Tuesday. It brings together officials and business representatives from Jordan and GCC member states to discuss opportunities for the expansion and development of economic relations, the Jordan News Agency reported.

The forum, which is taking place under the title New Horizons for Economic and Investment Cooperation, aims to advance the strategic objectives and interests of all participating nations, according to the Jordanian Ministry of Industry, Trade and Supply.

The delegates at the two-day event include businessmen, investors, the heads of trade federations and chambers of commerce, and representatives of Gulf and Jordanian government stakeholders, according to the ministry.

In his opening remarks, Youssef Shamali, the Jordanian minister of industry, trade and supply, said that the value of trade between his country and GCC member nations reached $6.6 billion in 2021. Jordanian exports to the GCC were worth $1.7 billion of that total, while Jordan’s imports accounted for $4.9 billion.

The minister added that Gulf nations are responsible for the most significant foreign investments in Jordan, and capital from the region has benefited the nation’s economy and created jobs for the Jordanian people.

He added that if Arab nations were to unite to form a powerful economic bloc, it would allow them to boost exports, increase production, create new job opportunities for young people, and achieve greater integration into the global economy.

ECB eyes blockchain for settling bank transactions, says official

Updated 26 September 2022

ECB eyes blockchain for settling bank transactions, says official

  • The ECB is among a number of central banks around the world working on digital versions of their currency in response to the popularity of digital tokens

FRANKFURT: The European Central Bank is studying ways of settling transactions between banks on a blockchain in a bid to keep control of money even if lenders switch to distributed ledgers, ECB board member Fabio Panetta said on Monday.

The ECB is among a number of central banks around the world working on digital versions of their currency in response to the popularity of digital tokens such as Bitcoin and the blockchain technology that powers them.

This distributed ledger technology is predicated on market participants verifying transactions and keeping a copy of them rather than relying on a trusted party, such as a central bank.

On top of a digital euro for consumers, the ECB is looking at how it could let banks settle wholesale transactions between them on a distributed ledger, rather than the central bank’s own.

“Despite the uncertainties surrounding DLT’s potential, we want to be prepared for a scenario where market players adopt DLT for wholesale payments and securities settlement,” Panetta said. 

We want to be prepared for a scenario where market players adopt DLT for wholesale payments and securities settlement.

Fabio Panetta, ECB official

He added letting banks settle among themselves or use stablecoins, which are crypto tokens pegged to a conventional currency, would result in “trading and liquidity becoming fragmented.”

Meanwhile, giving stablecoins the ECB’s backing would “outsource the provision of central bank money to private entities, endangering monetary sovereignty,” Panetta said.

As a possible solution, Panetta said the ECB might build a bridge between the private sector’s blockchain platforms and its own Target 2 settlement system.

Alternatively, it could make central bank money — the claim against the ECB in which wholesale transactions are settled — available on those platforms or create its own, he added.


Indian currency seen at record low as dollar, US yields surge; RBI eyed

Updated 26 September 2022

Indian currency seen at record low as dollar, US yields surge; RBI eyed

  • The rupee is tipped to open at around 81.30 per US dollar, down from 80.9900 in the previous session

MUMBAI: The Indian rupee is poised to hit a new lifetime low against the US currency on Monday, as worsening risk sentiment and a tumbling pound lifted the dollar index to its highest since 2002.
The rupee is tipped to open at around 81.30 per US dollar, down from 80.9900 in the previous session.
The local unit had reached a record low of 81.2250 on Friday, prompting the Reserve Bank of India (RBI) to sell dollars, according to traders. The RBI’s intervention had aided the rupee to turn briefly higher on Friday.
“It will be another choppy and volatile session. All eyes will be on state-run banks at open,” a trader at a Mumbai-based bank said, alluding to intervention from the RBI through these banks.
“The intervention by RBI at 81.20 was quite forceful and markets will want to know if that level will be protected again,” the trader said, adding, the RBI may not be too inclined to intervene given the “carnage” across Asian currencies.
The dollar index in Asia trading climbed above 114.50, the highest since May 2002, thanks to demand for safe-haven assets and a collapsing British pound.
The pound tumbled to a record low on Monday on fears the new government’s economic plan will stretch its finances to the limit. The rout prompted speculation of an emergency response from the Bank of England.
Asian equity gauges fell by as much as 2.4 percent and futures pointed to more losses for the S&P 500 Index. The offshore Chinese yuan declined below 7.16 to the dollar and the Korean won dropped more than a percent.
Treasury yields continued to march higher, not benefiting from the risk-off sentiment. The 2-year Treasury yield reached a fresh multi-year high of 4.27 percent on bets that the Federal Reserve will continue to hike rates aggressively despite the mounting growth risks. 

Bahrain’s GDP grows at 6.9% in Q2 2022

Updated 25 September 2022

Bahrain’s GDP grows at 6.9% in Q2 2022

  • The Gulf country will see modest hike in oil production in 2022 to 0.19 mbpd

RIYADH: Bahrain’s gross domestic product grew 6.9 percent year on year in the second quarter of 2022, posting the biggest annual increase since 2011, Bahrain’s Crown Prince Salman bin Hamad Al-Khalifa said on Twitter on Sunday.

In the first quarter, the Gulf country’s GDP grew 5.5 percent year on year at constant prices. The country’s non-oil economy recorded growth of 7.8 percent in the same period.

According to the latest Economic Insight report for the Middle East, commissioned by ICAEW and compiled by Oxford Economics, Bahrain’s oil sector growth will be driven by higher oil production, despite a decline in the first quarter. Since 2015, the annual real growth of Bahrain’s oil sector has only expanded once relative to the previous year, in 2019. Based on the current OPEC+ agreement, Bahrain will see a modest increase in oil production in 2022 to 0.19 million barrels per day from 0.17 million bpd.

This small increase, combined with elevated prices, will return the oil sector to growth in 2022 before stagnating again as the government continues its diversification efforts. The forecast is for oil production to expand by 5.8 percent in 2022, compared to 2.4 percent in 2021.

Scott Livermore, ICAEW economic adviser, and chief economist and managing director, Oxford Economics Middle East, said: “The surge in oil prices and introduction of a 10 percent VAT is supporting Bahrain’s revenues and will help authorities come close to balancing the budget in 2022, two years earlier than the 2024 target set in the Fiscal Balance Program.”

The rise of inflationary pressures and rate hikes by the US Fed will force the Central Bank of Bahrain into more rate increases, beyond the 225 basis points cumulative increase in the key policy rate already this year.

Inflation averaged 3.4 percent in the first half this year, a level not seen since 2016, before rising to 3.9 percent in July.

ICAEW expects inflation to average 3.9 percent this year after prices fell annually in both 2020 and 2021.

Consumer spending is likely to be increasingly constrained going into 2023, leading to a GDP growth slowdown to below 2 percent by 2024.

As of now, the central bank has sufficient reserves to maintain the currency peg with the US dollar and is likely to follow policy moves by the Fed closely so it’s not expected to have significant pressure to devalue the dinar.

The current account returned to surplus in 2021 at 6.7 percent of GDP, the largest surplus since 2013. ICAEW expects the higher price of oil exports and a continued resurgence of international travel to push this surplus above 10 percent in 2022.


Saudi Arabia focuses on AI-driven economy, considers data the new oil: SDAIA

Updated 25 September 2022

Saudi Arabia focuses on AI-driven economy, considers data the new oil: SDAIA

  • The technology will contribute billions to the Saudi national gross domestic product, says SDAIA's Mishari Al-Mishari

RIYADH: The Saudi Data and Artificial Intelligence Authority is aiming to create a leading data and AI-driven economy and make Saudi Arabia one of the top countries in the technology, the agency’s deputy director said. 

Mishari Al-Mishari, the deputy director of SDAIA, told Arab News on the sidelines of the Global AI Summit in Riyadh that SDAIA was created to be the custodian of the national agenda on data and AI.

“SDAIA was created to have an entity that will be the custodian of the national agenda of data and artificial intelligence to create a leading data and AI-driven economy,” he said. 

The conference, which SDAIA organized, hosted up to 30,000 hybrids and in-person attendees and had representatives from more than 90 countries, he said. 

“In this summit, we didn’t restrict it to the dialogues and the discussion; we emphasized the experience as well,” he added. 


The conference, which SDAIA organized, hosted up to 30,000 hybrids and in-person attendees and had representatives from more than 90 countries, Mishari Al-Mishari, deputy director of SDAIA, said.

Over 40 use cases designed by leading companies and institutes in AI were presented at the conference, allowing attendees to interact with, live, and experience AI and understand how it could improve their lives, Al-Mishari said. 

During the event, SDAIA President Abdullah bin Sharaf Al-Ghamdi announced that the Kingdom is joining the World Bank’s Digital Development Partnership.

“We share a common vision with the DDP. The partnership will bring together the public and the private sector and accelerate safe and inclusive digital transformation in developing countries,” said Al-Ghamdi. 

He added: “I am confident we will make a real difference. I am looking forward to a fruitful collaboration.” 

Al-Mishari said the initiative would help underdeveloped economies adopt AI for the benefit of their citizens.

The technology, according to Al-Mishari, will contribute billions to the national gross domestic product. In addition, it could boost the economy with jobs, investments and opportunities for the Kingdom. 

“Data is the new oil, and that’s our perception and belief of how much we could make out of data,” Al-Mishari said. 

Public sector cloud

“SDAIA operates one of the biggest governmental clouds in the region, hosting approximately 140 governmental entities and providing 35 different cloud services,” Nawaf Al-Sahan, head of cloud computing at the National Information Center, told Arab News. 

NIC has also been harnessing its governmental cloud DEEM, founded in late 2018, as a proof of concept and has grown rapidly since then. 

At this point, NIC’s mandate is only to serve public sector undertakings, so he added that the DEEM exclusively serves public projects. 

Their internal team, entirely made up of Saudi female and male engineers, developed the cloud. 

“I am glad our team is all Saudis, young engineers, males and females. So that cloud is fully built by our Saudi talent,” Al-Sahan said. 

When it comes to cloud security, NIC implements strict measures. Two teams are responsible for securing the cloud, a larger team entrusted with governance, risk, and compliance does the monitoring for them, and an internal team performs penetration testing and their daily security operations, he said. 

Al-Sahan said that NIC is currently finished with its three-year strategy for 2025. 

As part of that strategy or roadmap, external vendors and partners participate in the government cloud, he said.

“So, we’ll open up a little bit for trusted partners to be part of the government cloud and provide unique services to the government entities,” he concluded. 

A 1-million-riyal idea 

SDAIA, in partnership with the Ministry of Rural Affairs and Housing and the Royal Commission for Riyadh City, announced “Smartathon — The Smart Cities Challenge” with prizes totaling SR1,000,000, according to Sattam Alsubaiee, assistant director for insights at NIC. 

The competition is open for anyone globally, he said. SDAIA wants participants to develop AI models that detect visual pollution automatically. 

“We give them the data, and everyone is invited to participate, take that data and build AI models that can detect the visual pollution,” Alsubaiee told Arab News. 

Because humans have limited resources, SDAIA and its partners do not want to deploy a vast workforce to detect that visual pollution with their eyes.

“You cannot deploy thousands of inspectors trying to find all the visual pollution in all the cities. So, we want the machine to help us automate in solving that problem,” he added. 

Alsubaiee cited graffiti on walls, poor-looking billboard signs and potholes as examples of visual pollutants.

SDAIA is publishing data they already have and collected to invite everyone to contribute and help them solve those problems, he said. 

“We want to make Saudi Arabia one of the smartest countries in the world, not just at the city level, but at the country level,” he concluded.