YCLOAK

The sanctions imposed by Saudi Arabia and other Arab states on Qatar have been a blessing for Mohammed Kuwari and his al-Rawa brand of yoghurt. With competing Saudi products off the shelves, his business is booming.

“Our sales doubled! There’s lots of production as you can see and we have a big share in the market now,” said the 30-year-old dairy factory owner.

Previously he struggled to compete against products trucked in from Saudi firms like the Middle East’s biggest dairy, Almarai.

But last week Saudi Arabia, the United Arab Emirates, Egypt and Bahrain imposed an economic and diplomatic boycott on Qatar, accusing the small Gulf state of funding terrorism and cosying up to their enemy Iran, which Qatar denies.

The measures have disrupted imports in Qatar, which buys most of its food from the neighbors that have ostracized it.

Change in trading patterns?

Qatar’s own mostly small consumer businesses say they are finding new suppliers, which could alter established trading patterns in the Gulf.

Plastic and cardboard that Kuwari’s company uses to make packaging are stuck in containers in Dubai, he said.

“We were stunned at first. Our supply of raw materials was completely cut off,” said Kuwari. “But we took action.”

Kuwari says he will terminate contracts for raw materials from the Dubai-based conglomerate JRD international worth 30 million riyals ($8.21 million) a year. Instead he is forging deals with Turkish, Indian and Chinese companies to secure future supplies that will be shipped to Qatar via ports in Oman and Kuwait.

Pulling plug on contracts

Qatar typically imports perishable goods through its land link with Saudi Arabia. Millions of dollars of other goods and materials also come every month via Dubai’s Jebel Ali port which serves as a major re-export hub for the Gulf.

Businesses in Qatar say they are pulling the plug on UAE and Saudi contracts, and don’t expect to resume them even if the diplomatic storm blows over.

“We are not working with them again. They didn’t honor their agreements. Our products are being held up there,” said Ahmed al-Khalaf, chairman of International Projects Development Co. and owner of a Qatari meat processing plant that imports materials from the UAE.

“We may not have many factories in Qatar but we have the money to buy from other sources.”

Richest country

Qatar is the world’s richest country per capita, with just 2.7 million residents and income from the world’s biggest exports of liquefied natural gas. Nearly 90 percent of its population are foreign guest workers, mostly from South Asia or poorer countries in the Middle East.

Dubai offers lower costs and shorter shipping times than many other ports in the Middle East. But Oman’s Sohar port has been trying to compete by expanding its capacity. Business from Qatar could help that effort.

On Monday, Qatar launched two new shipping services to Omani ports as the gas-rich country seeks to secure food supplies closed off by the Saudi-led boycott.

 
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Wind and solar accounted for more than 10 percent of U.S. electricity generation for the first time in March, the Energy Department’s Energy Information Administration said on Wednesday.

Wind and solar power capacity has been growing in the United States, accounting for an average of up to 7 percent of electricity in 2016.

Texas, a wind power giant, accounted for the largest total amount of wind and solar electricity generation in 2016, according to the EIA.

Meanwhile, Iowa ranked as the state with the highest share of renewable energy in its electricity mix, with 37 percent of electricity generation from wind and solar.

A separate report released on Wednesday by Deloitte found that consumer and business preference will continue to drive demand for renewable energy.

The report found that 61 percent of customers wanted a certain percentage of electricity to come from renewable energy.

 

 
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Top officials of the U.S. central bank raised the benchmark interest rate slightly on Wednesday, as the recovering economy no longer seems to need quite as much of the boost it gets from ultra-low rates.

The Federal Reserve raised its short-term rate a quarter of a percent, to a range between one and 1.25 percent.  

To cope with the recession that started in 2007, the Fed cut interest rates nearly to zero, a record low, in a bid to cut the cost of borrowing and encourage economic activity and cut unemployment.  

With the jobless rate cut from 10 percent to just 4.3 percent recently, the recovering economy no longer needs so much help from low interest rates.  Wednesday’s action is just the latest in a gradual series of rate hikes that are moving interest rates back toward the rates usually seen over the past few decades.  

Officials worry that keeping rates too low for too long could spark a burst of inflation that could hurt the economy. Fed officials have been trying to get inflation to rise to a low but manageable rate of about two percent.  The inflation rate remains below this target.  

Fed officials also said they would reduce the central bank’s huge holding of bonds and other securities later this year. During the recession, the Fed purchased $4.3 trillion worth of financial products in a complex bid to further boost growth by cutting long-term rates. The plan calls for gradually reducing these holdings in ways that do not disrupt markets.  

The Fed’s leaders say they expect the world’s largest economy to grow at a 2.2 percent annual rate this year, and expand a bit more slowly in 2018 and 2019. They predict a slight decrease in the unemployment rate, and a slight rise for the inflation rate.
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China’s three big Internet-driven companies, Alibaba, Tencent, and Baidu, are set to influence a vast section of the country’s business because they control data concerning the consumer and social behavior of millions of people. The awesome power comes from the government’s drive to develop a “big data” industry, which is thriving in China.

Several other players, including utilities like phone companies and retail chains, are also trying to dip into the newly discovered pot of money from buyers who need information to understand buying preferences of potential customers, and design their products and strategies in line with the data flows.

“It [big data] is an improvement to do [a] better job, but unfortunately your [consumer’s] lifeline is more and more dependent on these big three guys,” said Chiang Jeongwen, a professor of marketing at the China Europe International Business School.

Recent studies have shown that nearly 90 percent of China’s 731 million online users have made at least one online purchase, often involving the use of Baidu’s search facilities, e-commerce sites and third-party transactions using mobile phone apps.

Predicting trends

“People are buying things and using their third party payment systems. [That] information [is] also being captured by Tencent and Alibaba. That is huge because now they know both offline and online information of consumers,” said Chiang.

These companies own a wide range of businesses that makes it possible for them to gather both online and offline data that is generated when a customer uses a phone app to make payments at a physical shop.

Alibaba owns Alipay while Tencent runs the highly popular WeChat service which offers mobile payment options. Baidu is China’s biggest internet search engine and holds the kind of influence that Google does in other countries.

“They have diversified the services [that] they offer. Alibaba, they are big in e-commerce. The kind of data they generate comes from anything ranging from what you buy online to your bill payments, travel bookings you do with, for example, the Alipay app,” said Shazeda Ahmed, visiting academic in the technology and economics division of Mercator Institute of Chinese Studies.

“People use the same platforms to make purchases, so there is a sense of extreme power in this situation because you can do all of these on one platform,” she explained.

These companies have a very strong predictive power that comes from a vast store of historical data and real-time data that they are collecting from users of different services. “They kind of able to anticipate the next thing a user might want before the user himself is aware of it,” she said.

Trading in data

The expansion of big data has given rise to serious concerns about the privacy of millions of people, who reveal both their transaction information and facets of social behavior through social media.

China has seen the rise of a black market for data. Data sellers offer a wide range of data on a targeted person, business or community by cracking into official databases and privately run sites.

But Chinese officials insist the government has put in place strong safeguards.

“There is a very strong firewall built before the big data center was established,” Zhang Bin, a senior official of the main big data center established by the Chinese government in Guiyang city. “We also made strict policy to control the data leaks from the government, so these are the two ways to protect information not to be leaked to the private companies for illegal use.”

The government has established a big data exchange center in Guiyang to encourage private and state-run companies to trade in data in a transparent manner, and help the industry find out the real price of the information. The center has come in for some praise by foreign companies who visited it but some questions remain unanswered.

“Having a legitimate place to trade data is an idea, but how does an exchange ensure that the data controllers has to requisite rights to sell data and it’s not breach of privacy?” Gagan Sabharwal, director of the National Association of Software and Service Companies in India, said after a recent visit.
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Panama’s business community on Tuesday cheered the Central American country’s decision to establish full diplomatic ties with China and ditch Taiwan, hoping to deepen links with a key customer of the nation’s shipping canal.

Although there was regret at the cost to Taiwan, an ally of various Central American nations, there was broad support for President Juan Carlos Varela’s decision to throw his lot in with China, whose growing global ambitions contrast with U.S. President Donald Trump’s isolationist rhetoric.

“I’m sure it wasn’t an easy decision, given the long-term links we’ve had with Taiwan, but nonetheless, [China] is a global superpower, the world’s No. 2 economy, the second biggest user of the canal – and so we think this is a positive development that will result in more business and investment in Panama,” said Inocencio Galindo, president of Panama’s Trade, Industry and Agriculture chamber.

The diplomatic U-turn comes as China attempts to position itself as a defender of free trade in the face of the “America First” policy of Trump, who was elected in November 2016.

Chinese officials also celebrated the news.

Wang Weihua, the permanent representative in the Office of China-Panama Trade Development and Beijing’s top representative in the country, said various attempts had been made over the years without success to establish formal ties.

Late last year, more advanced talks began with Varela’s team that concluded only this week, said Wang, who added he was involved in the discussions.

China is interested in Panama for its strategic location, and as a trade and logistics hub, he added.

“China has made a big bet on Latin America, where it has strategic investments, and Panama, which didn’t have diplomatic relations, was losing out on those advantages,” he said in an interview. “Now Panama will be able to enjoy what our country can offer it in various sectors.”

Almost a fifth of the cargo crossing the isthmus last year went to or from China, which has been taking an increasing interest in the Panama Canal.

In March, the canal’s administrator, Jorge Quijano, said Chinese state firms were considering developing land around the waterway, which was recently expanded.

A spokesman for the canal said Quijano would address the implications of the diplomatic change for commerce on Thursday.

Bright Future

Taiwanese economic aid has helped support Central America, a region in the United States’ backyard that relies heavily on agriculture and struggles with law and order.

Its remaining allies were guarded about what the future held for their ties with Taiwan, which China considers a renegade province.

Panama’s foreign minister, Isabel de Saint Malo, said Varela had expressed an interest a decade ago in establishing ties with China. She hoped the move would lead to trade, investment and tourism opportunities, especially for “exporting more goods from Panama to China.”

According to Panamanian statistics, total trade between Panama and China was worth $1.1 billion in 2016 – roughly 12 times the value of the nation’s commerce with Taiwan. Chinese exports accounted for the vast majority of it.

Alvin Weeden, a former comptroller of Panama, said the decision to break ties with Taipei in favor of Beijing would boost business and should have been taken years ago, given Panama’s reliance on global trade and Chinese shipping.

“Every day, Taiwan is more isolated,” he said, adding he did not expect the move to hurt Panama’s ties with the United States, the top canal customer. “This is a reality that’s happening, a geopolitical reality.”

Octavio Vallarino, a partner of Desarrollos Bahia, a local real estate firm, said he hoped direct flights would soon be established between the two countries, and that the commercial real estate market would be bolstered by arriving Chinese firms.

Sara Pardo, president of Panama’s hotel association, said the accord could help make travel between the two countries easier.

“This is definitely going to strengthen the economy,” she said.
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Mexico’s ancient civilizations cultivated crops such as maize, tomatoes and chilies for thousands of years before the Spanish conquerors arrived — and now those native plants could hold the key to sustainable food production as climate change bites, said a leading ecologist.

José Sarukhán Kermez, who helped set up Mexico’s pioneering National Commission for the Knowledge and Use of Biodiversity (CONABIO), said that analyzing the genetic variability of traditional crops, and supporting the family farmers who grow most of the world’s food offered an alternative to industrial agriculture.

“We don’t need to manipulate hugely the genetic characteristics of these [crops] … because that biodiversity is there — you have to just select and use it with the knowledge of the people who have been doing that for thousands of years,” said Sarukhán, CONABIO’s national coordinator, in a telephone interview.

The emeritus professor and former rector of the National University of Mexico (UNAM) recently won the Tyler Prize for Environmental Achievement, often referred to as a “Nobel for the Environment.”

Making use of the knowledge held by indigenous groups is “absolutely essential,” Sarukhán told the Thomson Reuters Foundation.

That requires working with a wide range of people, from local cooks to small-scale farmers, especially in states like Oaxaca and Chiapas in the south of Mexico where indigenous farmers have a strong traditional culture, he said.

“They haven’t gone to university, and they don’t have a degree — but they damn well know how to do these things,” he said.

For example, they discover and incorporate new knowledge as they exchange seeds with peers from different areas.

Key is funding

CONABIO is hoping to win some $5 million in funding from the Global Environment Facility for a five-year project worth more than $30 million to speed up research into indigenous crops.

The aim is to enrich the commission’s vast online database of biodiversity, with a view to influencing national agricultural policy, said Sarukhán.

CONABIO’s information on the genetic adaptability of native plants will enable scientists to develop new lines that can tolerate wetter or more arid conditions as the climate changes, he said.

Highlighting the potential of climate-adapted native crops, Sarukhán said around 60 types of maize are grown across Mexico, from the coast to 3,000 meters (9,843 feet) above sea-level, while only a handful of species are sold commercially.

Forest protection

With Mexico’s hugely varied ecosystems and biodiversity under threat, the ecologist urged a greater focus on schemes to boost local incomes rather than giving grants to encourage people to maintain vast swaths of the country’s forest.

Projects like growing organic coffee in Oaxaca’s forests or ecotourism in Chiapas are helping provide communities with a decent income and an incentive to protect the environment, he said.

Rural and indigenous communities own 60 to 70 percent of all Mexico’s forests and natural ecosystems, he noted.

“That is the patrimony they have — they don’t have anything else to live on,” Sarukhán explained. “There are ways in which you can combine the sustainable management of the forest with more attractive incomes for the owners of the forest.”
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With a record-breaking 26.5 million people going hungry in the Horn of Africa, development banks are increasing their humanitarian funding to fill a gap left by traditional donors, a high-level mission said on Tuesday.

Food rations for 7.8 million Ethiopians are due to run out in July due to funding shortages, while neighboring Somalia is on the verge of its second famine in six years.

In an unprecedented move, the World Bank is giving $50 million to the International Committee of the Red Cross (ICRC) and the U.N. Food and Agriculture Organization to distribute emergency food, water and cash in Somalia.

“We are demonstrating not just that we appreciate the kind of pressure that Somalia is facing but the importance of the humanitarian and development actors working together,” said Mahmoud Mohieldin, a senior World Bank official.

Consecutive failed rains have led to widespread crop failures, hurting farmers and livestock herders across the region, many of whom are hungry and on the move in search of grazing, water and work.

The African Development Bank (ADB) has also announced $1.1 billion to combat drought in six countries, mostly in the Horn of Africa.

Officials from the U.N., World Bank, ADB and African Union held a news conference in Nairobi after meeting displaced people in Ethiopia’s Somali region and Somalia’s Gedo region.

The greatest needs are in Ethiopia, where numbers are predicted to rise due to poor spring rains, and South Sudan, where 5.5 million people are short of food, with some areas already in famine, the U.N. says.

“We have both the biggest food insecurity crisis and the biggest displacement crisis this region has ever faced,” said Dirk-Jan Omtzigt, an analyst with the U.N. Office for the Coordination of Humanitarian Affairs in Nairobi.

The number of refugees and asylum seekers in East Africa has almost tripled to 4.3 million since 2011, he said, driven by conflict, climate change and economic shocks like falling livestock prices during drought.

In a “Grand Bargain,” struck at last year’s World Humanitarian Summit, donors promised to make their funding more flexible to respond to growing humanitarian crises globally.

The World Bank has started funding humanitarians to deliver aid in countries like Somalia and Yemen, where a rapid response is needed but conflict has weakened governments’ ability to reach needy populations, Mohieldin said.
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Sheltering under planks on his boat moored at a waterside slum in Lagos, fisherman Thomson Pascal is trying to protect his six children from the rain flooding into what is now their new home.

He is one of 30,000 residents who have been living in boats, shacks or in the open since bulldozers escorted by policemen destroyed their slum dwellings as competition for building land heats up in Nigeria’s booming commercial capital.

The site of their former settlement is now guarded by police and young men. A developer has unveiled plans to build a luxury residential and commercial complex there.

As with most things in Lagos, home to 23 million, the housing problem is magnified by the sheer size and energy of Nigeria’s megacity. Space is scarce as a result of new building projects, a high birth rate and the arrival of thousands of people every day from all over the country looking for work.

The Lagos State government said it had evicted the fishing community from the Lekki peninsula because their slum was a hideout for kidnappers and posed a risk to public health.

Authorities ignored a court injunction banning any demolition.

Residents and rights groups say this was an excuse to help a local businessman get rid of a settlement that had existed for decades so he could build more skyscrapers, hotels and malls.

“We don’t have anywhere else to go to. I sleep in this boat with my family,” said Pascal, cradling one of his young children in a makeshift cabin built from wooden planks saved from his former home.

“The government sent police to chase us out of our land with guns,” he said, an account confirmed by other residents and rights groups such as Lagos-based JEI and Amnesty International.

At least two people were killed, residents say.

They ended up in another slum, mooring their boats or moving into already crowded shacks. Locals already struggling to survive refuse to allow the newcomers to catch fish.

“We are too many now, for instance 12 to 15 people sleeping in a small flat,” said Agbojete Johnson, head of Pascal’s new community. “If government is not ready to relocate them … we shall have no other choice than to chase them away.”

Living in a leaky three-room wooden house, Johnson said he struggled to feed his 20 children. “This man has even 32 kids,” he said, pointing to another community leader sitting next to him.

The Lagos state commissioner for information, Steve Ayorinde, did not to respond to phone calls.

Demolition

“The demolition of #OtodoGbame was carried out as a security measure in the overall interest of all Lagosians,” a Lagos State body tweeted in April.

Officials also had warned of an “environmental disaster” after a fire destroyed much of the Otodo Gbame settlement due to a conflict between residents in November.

But residents said youths from another community claiming the land had set their wooden houses on fire while police had prevented them from extinguishing the blaze and later sent in a bulldozer to flatten the wreckage.

That was a month after the Lagos government had set a one-week deadline for the slum dwellers to move out.

A Lagos construction firm has announced plans to build an “eco-friendly” business city for 44 billion naira ($145 million) in the area. It denied, via local media, any involvement in the demolition but confirmed it had approval for the project.

The firm could not be reached for comment.

Police denied any involvement but residents and rights groups say they have seen policemen, including senior officers, during the demolitions.

Population

Nigeria’s population is set to nearly double to 400 million by 2050, making it the third most populous country after China and India, according to U.N. estimates.

Massive building projects, fueled by oil money, are in the works in Lagos. Aliko Dangote, Africa’s richest man, is building an oil refinery and petrochemicals plant, while more luxury flats are planned in Lekki, one of the city’s most desirable areas.

Such projects attract thousands of job seekers every day from across the country. Most Nigerians live in poverty as the oil wealth benefits only a small elite.

Officials say the influx has grown in the past two years due to the failure of several cash-strapped federal states to pay civil servants’ salaries and the Boko Haram Islamist insurgency in the north.

That makes it hard to plan roads, schools or transport in Lagos. By the time a project is finished it must cater to a much larger number of residents than expected.

Liborous Oshoma, a lawyer, said the Lagos government made the problem worse by removing slums to build luxury towers that are too expensive even for people on regular incomes.

“If you see the way Lagos State Government is going about grabbing, you know, waterfronts for the rich, it’s almost as if the Lagos State Government is trying to push out … the poor,” he said. “Many new buildings … are empty.”

The slum clearances have not only uprooted the fishermen.

“I haven’t been back to my school since April as it’s far away and I cannot afford the transport fee of 1,200 naira [$4],” said Edukpo Tina, a 21-year-old university student who has been living in a shack since being evicted from Otodo Gbame. “My daddy is a fishermen while my mum sells fish and none of them is doing their job anymore,” she said.
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The World Bank on Tuesday approved financing worth more than $500 million for Afghanistan to support a string of projects to boost the economy, help improve service delivery in five cities and support Afghan refugees sent back from Pakistan.

The bank said the six grants, including donor money, worth some $520 million would help the Afghan government “at a time of uncertainty when risks to the economy are significant.”

The international troop withdrawal, which began in 2011, and political uncertainties have impacted Afghanistan’s economy, while a worsening security situation has added to budget pressures, the World Bank said.

“The package will help Afghanistan with refugees, expand private-sector opportunities for the poor, boost the development of five cities, expand electrification, improve food security and build rural roads,” the World Bank said in a statement.

In May, a World Bank report said economic growth in the country was likely to pick up this year but not enough to provide jobs needed by its growing population.

The largest chunk of the package, some $205.4 million, will go toward supporting communities affected by refugees returning from Pakistan, the World Bank said. Some 800,000 Afghans have been sent back from Pakistan and Iran, many of them left to rely on subsistence income in rural areas or low-paid work in towns.

In addition, $100 million will support reforms and business development for the poor; $20 million will go to improving services in five provincial capital cities; $29.4 million will help establish wheat reserves and improve grain storage; and $60 million will boost electricity in the western Herat province.
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