AtOneGoFinancial Blog: August 2022

Wednesday, August 31, 2022

Volkswagen and Mercedes sign EV battery accords with Canada

Malay Mail

OTTAWA, Aug 31 ― Canada announced yesterday tentative deals with Volkswagen and Mercedes-Benz that would see the two European automakers tap into burgeoning North American supply chains as they seek to challenge Tesla in the electric vehicle market.

The memorandums of understanding were signed during a visit to Canada by German Chancellor Olaf Scholz, who is seeking to firm up access to new energy supplies for Germany and deepen bilateral trade ties.

The agreements “will help us meet growing demand, both here at home and around the world, for electric vehicles,” Canadian Prime Minister Justin Trudeau tweeted.

Scholz commented in a statement that the cooperation, notably in the securing of critical battery inputs such as lithium, nickel and cobalt, “may encourage other companies to follow.”

Mercedes-Benz said it envisages partnering with Canadian companies across the electric vehicle and battery supply chains, including Rock Tech Lithium for the supply of up to 10,000 tonnes of lithium hydroxide annually, starting in 2026.

The Volkswagen agreement specifically focuses on the production of battery precursor and cathode materials. Volkswagen's newly-formed battery company PowerCo will also open a Canadian office.

“Working hand in hand with governments around the world is an absolute prerequisite to meet our climate goals,” Volkswagen chief executive Herbert Diess said in a statement.

“The supply of battery raw materials and the production of precursor and cathode materials with a low carbon footprint will allow for a fast and sustainable ramp-up of battery capacity ― a key lever for our growth strategy in North America,” he added.

The deals come on the heels of several other agreements announced by the sector, including by Stellantis in March to manufacture batteries for electric vehicles in Canada.

Ottawa meanwhile has boosted its support of domestic exploration for critical minerals used to make electric vehicle batteries. ― AFP

Source: Malay Mail

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Sri Lanka says IMF bailout talks in 'final stage'

Malay Mail

COLOMBO, Aug 31 ― Cash-strapped Sri Lanka's president announced further tax hikes and sweeping reforms yesterday, saying that bailout talks with the International Monetary Fund were in the “final stage”.

The country of 22 million people has suffered months of dire shortages and protests culminating in the ouster of Gotabaya Rajapaksa last month.

Presenting a new budget, his successor Ranil Wickremesinghe said yesterday that Value Added Tax (VAT) would rise from 12 to 15 per cent for all goods and services from Thursday.

He said a dedicated debt management agency was being set up to restructure borrowings. In April, Colombo defaulted on its US$51 billion (RM228 billion) external debt.

“Negotiations with the International Monetary Fund have successfully reached its final stage,” Wickremesinghe told parliament.

“Discussions on debt restructuring will be held with the main countries that provide loan assistance to our country,” he said referring to China, Japan and India, the top three creditors of the island.

Debt restructuring is crucial to clinching an agreement with the IMF, which resumed its talks with Colombo last week after political upheaval in July held up negotiations.

Beijing has not publicly shifted from its offer of issuing more loans rather than taking a haircut on existing credit.

Wickremesinghe said he would press ahead with the politically unpopular “restructuring”, seen as meaning the privatisation of state enterprises subsidised by taxpayers.

First in line are the state-run energy companies as well as two state-owned banks that dominate commercial banking in the country, he said.

His government has already raised prices of fuel and electricity more than threefold and removed energy subsidies, a key pre-condition for a possible IMF bailout.

Last week, Wickremesinghe tightened import restrictions with a ban on more than 300 additional items, as the crisis showed no signs of abating.

Worker remittances, a key source of foreign exchange, have dropped by more than 50 per cent to US$1.6 billion in the six months to June compared to the same period last year.

Inflation is officially estimated to peak at about 65 per cent by next month while the import-dependent economy is forecast to contract by a record eight percent this year.

“This crisis will not be solved by accusing one another, nor by faulting the past,” Wickremesinghe told parliament while presenting the budget for the rest of the year.

Shortly after the president's speech, police in the capital Colombo fired tear gas and water cannon to break up a protest march by hundreds of university students unhappy with the government's handling of the crisis. Police said they arrested six students for disrupting traffic. ― AFP

Wall Street closes down for third straight session on Fed rate hike worry

Malay Mail

NEW YORK, Aug 31 ― US stocks closed lower for a third straight session yesterday as a rise in job openings fuelled fears the US Federal Reserve has another reason to maintain its aggressive path of interest rate hikes to combat inflation.

The benchmark S&P 500 index has tumbled more than 5 per cent since Fed Chair Jerome Powell on Friday reaffirmed the central bank's determination to raise interest rates even in the face of a slowing economy.

Labour demand showed no signs of cooling as US job openings rose to 11.239 million in July and the prior month was revised sharply higher. A separate report showed consumer confidence rebounded strongly in August after three straight monthly declines.

“They have to weaken the labour market and how are they going to do that ― they are going to jam rates and make things so expensive that people are going to pull back, demand is going to fall off, and people are going to get laid off,” said Ken Polcari, managing partner at Kace Capital Advisors in Boca Raton, Florida.

“It locks them in even further.” The data increases the focus on the August non-farm payrolls data due on Friday.

The Dow Jones Industrial Average fell 308.12 points, or 0.96 per cent, to 31,790.87, the S&P 500 lost 44.45 points, or 1.10 per cent, to 3,986.16 and the Nasdaq Composite dropped 134.53 points, or 1.12 per cent, to 11,883.14.

New York Fed President John Williams said yesterday the central bank will likely need to get its policy rate about 3.5 per cent and is unlikely to cut interest rates at all next year as it fights inflation.

However, Atlanta Fed President Raphael Bostic said in an essay published yesterday the Fed could “dial back” from its recent string of 75 basis point hikes if new data shows inflation is “clearly” slowing. Richmond Fed President Thomas Barkin said the Fed's pledge to bring inflation down to its 2 per cent goal will not necessarily result in a severe recession.

Traders are pricing in a 74.5 per cent chance of a third straight 75-basis point rate hike at the Fed's September meeting.

Each of the 11 S&P 500 sectors were in negative territory, with the energy sector down 3.36 per cent, the biggest percentage decliner, as oil prices settled down more than 5 per cent on concerns that the slowing of global economies could sap demand.

Rate-sensitive megacap growth and technology stocks such as Microsoft Corp, down 0.85 per cent, and Apple Inc, off 1.53 per cent, were among the biggest drags on the benchmark index.

Both the S&P 500 and the Nasdaq have broken below their 50-day moving average. The S&P 500 also briefly fell below the 50 per cent Fibonacci retracement level from its June low to August high, another key technical indicator watched by analysts as support.

The CBOE Volatility index, also known as Wall Street's fear gauge, rose for the third straight session and hit a six-week high at 27.69 points.

Adding to worries, Taiwan's military fired warning shots at a Chinese drone which buzzed an islet controlled by Taiwan near the Chinese coast.

Best Buy Co rose 1.61 per cent as one of the biggest gainers on the S&P 500 after it reported a smaller-than-expected drop in quarterly comparable sales thanks to steep discounts.

Volume on US exchanges was 10.51 billion shares, compared with the 10.54 billion average for the full session over the last 20 trading days.

Declining issues outnumbered advancing ones on the NYSE by a 4.27-to-1 ratio; on Nasdaq, a 2.44-to-1 ratio favoured decliners.

The S&P 500 posted no new 52-week highs and 18 new lows; the Nasdaq Composite recorded 15 new highs and 217 new lows. ― Reuters

Global shares tumble, yields jump as data fuel rate angst

Malay Mail

NEW YORK, Aug 31 ― World stocks tumbled for a third straight session yesterday as investors worried about continued US and European interest rate hikes, after data pointed to persistent inflation in both regions despite central banks' policy tightening so far.

Two-year US Treasuries scaled a new high not seen since 2007 after data showed US job openings increased in July. This suggested demand for labour was not slowing, bolstering the case for the Federal Reserve's aggressive monetary policy tightening path.

To discourage speculation that the Fed might cut rates next year to support economic growth, New York Federal Reserve Bank President John Williams said yesterday the central bank likely needed to get its policy rate above 3.5 per cent, and was unlikely to cut rates at all next year.

Data also showed German inflation rose to its highest in almost 50 years in August, beating a high set only three months earlier, and strengthening the case for the European Central Bank to go for a larger rate hike next month.

Reports that Taiwan fired warning shots for the first time at a Chinese drone, which buzzed an offshore islet yesterday, worsened already-fragile market sentiment.

The S&P 500 index quickly gave up early gains to fall 1.1 per cent to its lowest in over a month. The Dow Jones Industrial Average lost 0.96 per cent, and the Nasdaq Composite dropped 1.12 per cent.

“Equity markets continued to be impacted by expectations central banks will keep their foot on the accelerator in terms of rate hikes,” analysts at ANZ Research said in a note to clients.

The pan-European STOXX index also gave up earlier gains to go down 0.7 per cent, and MSCI's world equity index fell 0.74 per cent.

The two-year Treasury yield climbed as far as 3.4970 per cent, its highest since late 2007, and well above benchmark 10-year yields, which rose to 3.1530 per cent for the first time since the end of June.

Germany's 10-year yield rose to 1.510 per cent, close to the two-month high reached on Monday of 1.548 per cent. ECB board member Isabel Schnabel had warned on Monday about rising inflation that sent bond yields spiking up 12 to 20 basis points.

Investors fear that policymakers' battle to contain rising prices worldwide with rate hikes could push economies into recession.

“One thing is clear: a recession in Europe looks all but inevitable, and the only question is how long and how severe it will be,” Frederik Ducrozet and Axel Roserens of Pictet Wealth Management wrote yesterday.

-Forceful action- At the Jackson Hole conference last week, Fed Chair Jerome Powell and ECB speakers flagged the need for forceful action to tackle inflation, driving selling of bonds and equities as traders jacked up near-term interest rate expectations.

“Investors looking for market salvation from a Fed pivot didn't get it at the Fed's travelling show in Jackson Hole,” said Jason Darho, head of asset allocation for the Americas at UBS Global Wealth Management.

“Instead, investors should expect the market regime of high volatility and range-bound trading to persist for a while longer.” Futures markets have odds of better than two-thirds that the ECB raises rates by 75 basis points in September, and see about a 70 per cent chance that the Fed does likewise.

US non-farm payrolls data are due on Friday, and markets may not like a strong number if it supports the basis for a continuation of aggressive rate hikes.

The prospect of more US rate hikes kept the dollar at 108.79, not far from the two-decade peak of 109.48 reached a day earlier. The euro reversed earlier losses to climb above parity to US$1.00205 (RM4.47), up 0.26 per cent.

Rodrigo Catril, a strategist at National Australia Bank, said the euro would be tested by upcoming inflation numbers in the eurozone, US jobs data, and Russian cuts to gas flows later in the week.

“The European story is actually all about the economic outlook. ... No energy means no growth,” he said, adding it would not be a surprise if the euro fell back to US$0.96.

Oil prices tumbled on fears that tighter monetary policy to fight inflation will dent the global economy, and soften fuel demand, and as Iraqi crude exports have been unaffected by clashes there.

Brent crude futures for October settlement fell 4.95 per cent to US$99.89 a barrel, after climbing 4.1 per cent on Monday, the biggest increase in more than a month.

Gold prices fell as the precious metal continued to wilt in the face of the strong dollar, with spot gold down 0.75 per cent at US$1,725.21 per ounce. ― Reuters

The 15 Worst Places to Live on Social Security

Broke senior opening empty wallet — Stramp / Shutterstock.com

Home is where the heart is — but make sure you can pay for it in retirement. Social Security stretches further in some places than others, SmartAsset found in a recent analysis. To compile its rankings of where Social Security goes furthest, SmartAsset subtracted the cost of basic necessities like housing, food and transportation from the average income folks receive from Social Security after...

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82 New Shows and Movies on Netflix in September

Person looking at new titles and shows on Netflix on laptop — wutzkohphoto / Shutterstock.com

Are you getting your money’s worth out of your Netflix subscription? How do you know? The ever-popular streaming service has a dizzying array of comings and goings each month. Keeping tabs on the latest shows and movies can give you something to look forward to — or an excuse to save a few bucks by canceling until the arrival of a series worth checking out. Here’s a list of specials...

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This Gas Station Is Now Offering 15 Cents Off Per Gallon

Wawa customers can take advantage of a new fuel discount available now through Oct. 30, the chain announced Tuesday. It's not the usual blah, blah, blah. Click here to sign up for our free newsletter. To qualify, drivers first need to register for Wawa Rewards, a free loyalty program. Then they’ll need to take these steps: Download the Wawa App. Link a credit card to their rewards account in the...

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15 Markets With the Most Home Sales Getting Canceled

Young woman with glasses rips up a housing contract or cancelled deal — Stokkete / Shutterstock.com

Homebuyers are increasingly leveraging the power of a slowing market to say: “No deal.” About 63,000 people backed out of homebuying contracts in July, according to real estate service Redfin. That figure represents approximately 16% of the homes that were under contract for sale that month and is the highest rate since April 2020 at the beginning of the COVID-19 pandemic. Redfin notes that homes...

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Tuesday, August 30, 2022

You Only Have 3 Days Left to Request Free COVID-19 Tests

Woman with COVID test — 4kclips / Shutterstock.com

The federal government unveiled its first round of free COVID-19 test kits in January, and a second round followed in March. In May, the government announced a third and larger round, offering up to eight kits per household instead of just four. The supply seemed endless. But it appears that’s about to change. It's not the usual blah, blah, blah. Click here to sign up for our free newsletter.

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9 Good Reasons to Cancel Netflix

Skeptical, frustrated man with glasses and folded arms — Dean Drobot / Shutterstock.com

Netflix streaming had its biggest year ever in 2020, picking up 37 million new subscribers worldwide. But that was while everyone was trapped at home. The company’s second-quarter 2022 earnings report showed a loss of nearly a million subscribers. That was the biggest loss in company history, according to NPR. As the pandemic recedes and people move on with their lives, many of us are re...

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13 States That Could Tax Forgiven College Loans

Woman with books and a money bag — Elnur / Shutterstock.com

President Joe Biden recently announced that millions of student loan borrowers would have up to $10,000 — or more — of their college debt forgiven. But is it possible that you will have to pay taxes on the debt you no longer owe? Yes, according to the Tax Foundation, some states could levy income taxes on the forgiven amount. Typically, when a debt is discharged, it is considered to be taxable...

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7 Ways to Shop at Costco Without a Membership

shopping online at Costco — rafapress / Shutterstock.com

Americans love Costco. The warehouse chain has more than 116 million card-carrying members. A membership with Costco is not free, but here’s a little secret: It turns out you can enjoy some aspects of Costco without paying for a membership. Consider some of these methods that allow anyone to shop at Costco: It's not the usual blah, blah, blah. Click here to sign up for our free newsletter.

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8 Markets Where Home Values Are Falling Now

Home in Phoenix, Arizona — David Neely / Shutterstock.com

After months of speculation, home prices finally have begun to fall in many housing markets across the country. Prices slipped in 30 of the 50 largest metropolitan areas in the U.S. from June to July, according to Zillow. Overall, they still remain elevated over the past year — up 16% — but the predicted housing recession may be underway. Home prices in the U.S., as measured by the raw Zillow Home...

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Monday, August 29, 2022

Tax Matters – The increasing importance of managing tax risks

THE latest thrust by the Inland Revenue Board (IRB) to develop sustainable tax collection is the introduction of the Tax Corporate Governance Framework (TCGF). It is intended to work within a good corporate governance framework that ensures business enterprises report and pay the correct taxes.

From the IRB’s perspective, this will provide accountability, transparency, accuracy, and completeness of information. This will also provide taxpayers certainty and avoid surprises.

To achieve the above aims, identifying, assessing, and managing tax risks is the most important pillar within the TCGF. The reason being that in the event the risk is mismanaged or not identified, the cost to the taxpayer can be expensive in the form of additional taxes and penalties, and to the IRB, the missed opportunity to collect the correct taxes at the right point in time.

When do risks arise?

Risks arises when there is uncertainty, and this is due to the interpretation and application of the tax laws. Tax laws are often subjective with gaps in the law and case law developments usually adds to another layer of subjectiveness.

Another area where tax risks are self-created is when taxpayers do not keep up with changes in the tax legislation/practices adopted by the IRB.

Types of risks

• Compliance risks

Risks encountered when preparing and submitting the tax returns. Examples would be the misalignment of the underlying records with the positions taken in the tax computation, or the disconnect between the underlying documentation and the actual transaction.

• Transactional risks

When transactions are non-routine in nature, such as business reorganisation, mergers and acquisitions, sale/purchase of businesses, tax uncertainty may arise in the interpretation and application of the law. This could cover the whole range of taxes.

The usual questions that will arise would be whether it is capital or revenue, whether such transactions attract sales or services tax, and the amount of stamp duty to pay. Anti-avoidance is another problematic area.

• Routine operational risks

This arises when there are recurring transactions such as sales and purchases of goods, services and intangibles (intellectual property related payments such as license fees). An example is when you fail to deduct withholding tax or account for sales and service tax on routine transactions.

• Reputational risks

This could occur if the tax authorities initiate a tax probe of a serious nature such as a tax investigation. If such information becomes a news item, there is always a danger that the perceptions of the customers, suppliers, and employees can be negatively affected.

Why manage risks?

The cost of neglecting risk management will result in additional taxes and penalties. Do not take the attitude of “wait until the IRB catches you”.

The current approach by the IRB is to encourage taxpayers to be transparent with them on the risk areas which is now clearly embedded in the TCGF.

If taxpayers remain delinquent and refuse to cooperate, the IRB has no choice but to use its enforcement powers to seek out such taxpayers and impose the maximum punishment through additional taxes, penalties and bringing such taxpayers to court.

Who is responsible?

The TCGF makes it clear that the ultimate responsibility for managing the tax affairs and tax risks lies with the board of the company, and the execution lies with the management of the company.

How to manage the risk?

First, identify risks and assess the financial implications of the risks. Second, document the basis supporting your positions and ensure reporting of such risks immediately to the senior management and the board of directors.

Constantly review the internal controls to identify, assess and mitigate the risks. This will include aligning the accounting system and the IT systems to support the management of the tax risks.

With the government seeking additional revenues to narrow the budget deficit, it is best for taxpayers to manage their tax risks through increasing their transparency and engagement with the IRB.

This article is contributed by Thannees Tax Consulting Services Sdn Bhd managing director SM Thanneermalai (www.thannees.com).

Source: The Sun Daily

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Langkawi eyes premium retail, healthcare, education investors

KUALA LUMPUR: Langkawi hopes to attract investors to develop its premium retail, healthcare and education sectors as it eyes revenue of RM4.25 billion in tourism receipts this year from an expected 2.5 million tourists, according to Langkawi Development Authority (Lada) CEO Nasaruddin Abdul Muttalib.

“Currently, we do not have a big shopping complex or premium outlet in Langkawi, so most of our international tourists will continue their vacation in Kuala Lumpur or Penang, just for the purpose of shopping. (We hope) we can have premium outlets and high-end shopping complexes in Langkawi so (that tourists) can spend more time and more (money) in Langkawi,” he told SunBiz in an interview.

Nasaruddin noted that Bina Darulaman Bhd is developing a premium outlet next to Langkawi International Airport, which is expected to be completed in 2024. The project has a gross development cost of RM233 million.

Additionally, Lada aims to make Langkawi a top choice for health tourism for which it hopes to attracts tourists from nearby areas such as southern Thailand and northern Sumatra.

“We believe if we can complete the package with good international medical services, it will make Langkawi a better destination. We can cater this health tourism for the southern Thailand people and northern Sumatran population,” he added.

Nasaruddin said, a few companies have approached Lada but none has secured an agreement for development thus far. It is open to any proposal to develop its health tourism.

Lada also sees an opportunity to develop its education sector, especially international schools, driven by the increase in the number of expatriates in the area.

Nasaruddin said international schools are able to cater to expatriates in Langkawi and the northern region, including Kedah and Penang. More and more expatriates are coming to Kulim and Sungai Petani, too.

“We believe Langkawi is a good destination for international schools, including international campuses for universities. We have a good connectivity with flights. We expect these students to stay in hostels (and for) international schools (to have) boarding facilities. We are in talks with a few investors but all are still in planning stage. But it is the (sector) that Langkawi is looking (to develop).

“Basically we want Langkawi to be the top destination choice for domestic and international tourists. Actually, we (Malaysia) need one destination that can compete with other international destinations in this region. We believe Langkawi can well represent Malaysia for this purpose (international tourism standards),” he remarked.

Nasaruddin shared that, currently, there are 10 five-star hotels on the island and it hopes to attract more high-end hotel investment.

“Coming up is ParkRoyal which will start operating this December. In the pipeline, we also have a Hilton hotel coming up in Burau Bay which is expected to be completed in 2024,“ he said.

On leasing land to investors, Nasaruddin said interested investors can directly deal with Lada in order to fast track the process, subject to Lada’s approval.

“In total we have more than 2,500 acres of land. Some have already been developed (and) some are still under negotiations. But we still have more than 500 acres to offer to be developed by investors,” he stated.

Nasaruddin is optimistic on the tourism outlook this year, but pointed out that there are still countries imposing strict travelling restrictions, making it a challenge for Lada to woo more tourists to visit the island. Nevertheless, he believes that 2023 will be better than this year, for the tourism industry.

“We believe more and more countries will ease their procedures for travelling.

For 2023, Lada is expecting 3 million tourists which it reckons will generate revenue of RM6 billion.

“Tourism is still our main focus. For next year, our focus is to increase the number of international tourists coming to Langkawi with the assumption that more countries will ease their travelling procedures and we hope that China will open up next year and that (will) really help in terms of tourist numbers for Langkawi,” Nasaruddin said.

Don’t be tempted by the recent crypto rally

CRYPTO’s rally over the past month continues to dispel any notion of the asset class as a risk or an inflation hedge. The prospect of a US Federal Reserve (Fed) pivot has meant that it has mimicked other risk-on asset classes like tech, rallying on the prospects of a less hawkish Fed, but it has also led to calls about the end of “crypto winter”.

This optimism barely lasted for two days before yet another heist in the Solana ecosystem tempered investor sentiment – just the latest entry in a rapidly increasing list of incidents.

We have also seen various major institutions within the crypto space declare bankruptcy and halt withdrawals, including crypto lending company Celsius, hedge fund 3 Arrows Capital, and brokerage platform Hodlnaut.

In light of this, the optimism seems sorely misplaced and unfounded. For investors tempted by the recent rally, we yet again reiterate our stance – do not chase the momentum. We remain unconvinced by the short-term and long-term story behind cryptocurrencies, as well as the narrative that the crypto winter is over. In fact, we think it might not even have begun.

Return of risk-on sentiment likely to be short-lived

This recent revival was driven by a return of risk-on sentiment as markets have started to price in expectations of a Fed pivot. At the recent Fed meeting, stock prices rose as markets took Fed chair Jerome Powell’s statements – that the central bank would begin making rate decisions on a meeting-by-meeting basis – as a signal that rate hikes might soon slow down.

Similar to the rally in tech and other long duration stocks, this has driven crypto prices up.

This sentiment has since been dispelled by a flurry of statements by Fed officials, and with inflation still at elevated levels and employment robust, we believe that we are still en route to a new reality with higher inflation and interest rates – which means more rate hikes to come.

Even though inflation seems to be trending in the right direction, upward price pressures remain broad-based.

Thus, the Fed is nowhere near done in its ongoing battle against inflation, and is unlikely to make a huge policy pivot from where they are.

Crypto’s end-use case remains elusive

In the short term, with the Fed pivot likely to be wishful thinking by overeager investors, we think much of this rally will likely be tempered as the global monetary environment continues to tighten. Bitcoin has exhibited a strong correlation with global money supply, and in light of this, its near-term outlook looks bleak.

In the long term, we continue to question the viability of cryptocurrencies. Despite being around for more than a decade (with the underlying technology having been conceptualised as early as 1981), the end-use case for the asset class (and underlying technology) has remained elusive.

While crypto proponents continue to wax lyrical about the long-term prospects and even current applications of various coins and technology, these often come with caveats and limitations – and are often far from the ideal solution for the issue they are trying to solve. Considering the hype and attention around the industry, if there was a best-use, scalable application, we would have certainly heard of it by now – and the lack of such a case remains extremely telling and worrying.

Within the limbo of current crypto “innovation”, the result is often a repackaged version of the same product – born out of its wilful ignorance of past lessons.

As such, it has failed to rectify or improve on any of the issues to a significant degree.

Our stance: Don’t be tempted by the recent rally – crypto’s reckoning is yet to arrive

Once again, we would like to remind investors – avoid this “Greater Fool Investment Strategy” asset class.

While regulations will ultimately be good for the space – we don’t expect crypto to adapt to regulatory changes well. We expect most of the space to fail to survive the incoming regulatory tightening, and with a lack of intrinsic value, there is no fundamental support. In addition, the intertwined and leveraged nature of the crypto industry – coupled with the lazy, “what could go wrong” attitude - means that contagion is all but certain, and investors should stay clear.

Crypto winter is far from over – in fact, it may not even have begun.

This article is contributed by iFast Research. The views expressed are the contributor’s own.

Japan vows to work for ‘more resilient’ African economies

Malay Mail

TUNIS, Aug 29 — Japan will cooperate closely with African countries to promote “more resilient” economies, Prime Minister Fumio Kishida told the final session of an investment conference in Tunisia on Sunday.

He also promised Japan would use its place on the United Nations Security Council next year to push for a permanent African seat on the world body, a day after announcing US$30 billion (RM134 billion) in public and private finance for the continent.

Japan wants “to create an environment where African people can live in peace and security so they can develop,” Kishida said, speaking via live video from Tokyo after testing positive for Covid-19 days earlier.

Senegalese President Macky Sall, chair of the 55-member African Union, backed Kishida’s call for the continent to have a seat on the UN Security Council.

Conflicts “that destabilise us and prevent us from developing must be taken into account by the Security Council” whose mission it is to promote international peace and security, Sall said.

He also called for a greater role for African peacekeepers in resolving conflicts.

“Without security there can be no development,” Sall said.

The eighth Tokyo International Conference on African Development (TICAD) took place in Tunisia, one of many import-dependent countries battered by global supply disruptions and price spikes unleashed by the coronavirus pandemic and the war in Ukraine.

Some 20 African heads of state and government took part in the summit in the North African nation, which brought together around 5,000 people from business and other sectors and shut down major roads across Tunis, causing weekend traffic chaos.

‘New approach’

Tunisian host President Kais Saied called for a “new approach” towards Africa, noting that many countries which had racked up large foreign debts since independence were also net exporters of human resources — taking skills gained in Africa to be used in the global North.

“Who is lending to whom?” he asked.

Sall called for African debts to be rescheduled or cancelled, as well as for the implementation of a promise by the G20 group of nations to suspend interest payments.

“Given the double crisis we’re facing, these measures are necessary to relaunch our economies,” he said.

The conference came as Japan’s rival China cements its influence on the continent with its “Belt and Road” infrastructure initiative, and as experts express concern about the long-term sustainability of some African nations’ borrowing from Beijing.

Kishida also announced that Japan would appoint a special envoy to the Horn of Africa, where a long and devastating drought in parts of Ethiopia, Kenya and Somalia has prompted the UN’s weather agency to warn this week of an “unprecedented humanitarian catastrophe”.

In West Africa, Kishida said Japan would pump US$8.3 million into the troubled but gold-rich Liptako-Gourma tri-border area between Mali, Niger and Burkina Faso that has been ravaged by jihadist attacks in recent years.

The aid will aim to “develop good cooperation between residents and local authorities” and help improve administrative services for the area’s five million residents, he said.

In a final statement, the conference participants voiced “deep concern (over) the negative socio-economic impact” of the Ukraine crisis, saying it had created food insecurity in Africa.

“(We) reiterate the repeated calls for the resumption of the export of cereals, grains and agricultural products as well as fertilisers to global markets in order to relieve the African population,” the declaration read. — AFP

Innovative tech to unburden contact centre workers in Malaysia

COVID-19 has driven the acceleration of digital transformation, with companies moving business processes towards a smarter and data-driven future. Artificial intelligence (AI) and machine learning play a big part, allowing organisations to streamline and automate essential functions and improve efficiency.

According to a McKinsey survey, AI is used in at least one business function by 56% of companies worldwide. The benefits of the technology can be transformative; however, it requires focus and the right approach. Given its high impact capabilities, AI could be perceived as a panacea for many business problems without carefully considering either the specific problem they are trying to solve or its local context.

According to the same McKinsey global survey, contact centre automation is the third-most prevalent technology deployment in business functions; customer experience is one area that can benefit from AI-powered tools in the country.

Improving CX with better technologies

Starting at the front office organisations can leverage technologies such as omnichannel, AI-driven intelligent virtual assistants to free up time for human agents and allow them to focus on higher-level tasks. This form of automation removes a layer of repetitive, lower-level tasks for front-office staff and provides a quick and efficient way for customers to find the correct department or to be led towards the information they require to complete their inquiry.

Conversational automation adds a further layer of support for contact centre agents, augmenting the skills they already hold and the level of service they can provide. Such a platform can address the entire spectrum of conversational experience for both customers and the agents they are speaking to, using advanced tools such as Robotic Process Automation, conversational AI, and workflow automation to blend contact centre operations with back-office processes seamlessly.

Conversational AI

Looking specifically at conversational AI, this solution provides contact centre employees with increased information flow during a call. The platform can present them with real-time information relevant to the conversation they are having with their customer. This empowers better customer service and enriches the overall service experience.

An AI-driven platform will co-pilot the call, assisting the contact centre employee with advanced capabilities such as real-time insights and guidance, suggestions for added value, and real-time automation of repetitive tasks. AI-driven tools can also pick up on the tone of a customer’s voice and ascertain their mood – alerting supervisors if the call needs escalation. Such features can help build detailed customer personas and thus play a pivotal role in improving customer experience.

Data capture and analysis

The organisation can capture much data for every call that comes into a contact centre. Instead of siphoning that information into storage and potentially reducing its potential and risk it becoming siloed, organisations can apply it directly to their customer experience platform, further enriching the knowledge it holds. This allows AI-led technology to analyse and detect behaviour patterns, make sense of a customer’s preferences, uncover previously hidden relations between the customer and products or services, and systematise the data on that customer. This data and knowledge can make every customer journey more comprehensible for contact centre agents and empower them to perform the best possible job for every customer interaction.

This analysis – which may be drawn from a large pool of data, collected from various ingestion points such as voice, email, chat, and social media – allows the company to detect friction points in the customer journey and provide deep insights into the contact centre’s daily operations.

Roadmap to success

Unlocking business value by deploying these technologies requires strategic thinking and a clear roadmap. The process involves an evaluation of how best to integrate smarter technologies into contact centres.

The first step is to understand what type of customer queries make up the majority of traffic to that business and thus build awareness of the kind of interactions and the types of customers the organisation should prioritise. Automation removes the burden from contact centre agents, allowing them to manage a higher volume of calls better.

The organisation will need to define the processes that make sense to optimise with automation, and at what point customer queries need to be referred directly to a human agent.

Furthermore, the roadmap must evaluate how increased automation fits into a larger digitisation plan and assess all possible links between departments and the overall business transformation plan.

With the transition to a more digital economy, traditional enterprises —financial services, telecommunications, insurance, or e-commerce — will need to change their business models accordingly. Business success is built on customers and providing better outcomes. Smarter customer experience tools will go a long way towards supporting that success.

This article is contributed by Uniphore Apac co-founder and president Ravi Saraogi.

Germany says gas stocks rising quicker than expected

Malay Mail

BERLIN, Aug 29 — Germany is replenishing its gas stocks more quickly than expected despite drastic Russian supply cuts and should meet an October target early, the government said Sunday.

Europe’s largest economy is heavily dependent on Russian gas and has raced to bolster its reserves before winter after deliveries from Russia plummeted following the outbreak of war in Ukraine.

Last week, Germany’s energy regulator the Federal Network Agency said the country was unlikely to meet its goals.

But the government said energy-saving measures in recent weeks and massive purchases of gas from other suppliers saw “significant progress” made.

“Despite the difficult circumstances... the reserves are filling up more quickly than expected,” Economy and Climate Minister Robert Habeck said in a statement.

A target to achieve 85 per cent of gas storage capacity by October “should be reached by the start of September”, with current levels at 82 per cent, his ministry added.

Gas flows from the main pipeline, Nord Stream, fell to 20 per cent, with the European Union accusing Moscow of using energy as a weapon in its stand-off with the West over Ukraine.

To avert the risk of energy shortages, Berlin in July set a series of goals so that gas stocks reached 95 per cent of capacity by November.

The government has introduced measures allowing more coal-based power and reducing energy consumption in public buildings.

It has also spent €1.5 billion (RM6.7 billion) to buy liquefied natural gas, with Qatar and the United States being major suppliers, and five new LNG terminals are planned to import it by sea. — AFP

Sunday, August 28, 2022

France to keep curbing hikes in households’ energy costs

Malay Mail

PARIS, Aug 28 — The French government plans to continue to work to curtail the effect of rising energy prices on households next year, Prime Minister Elisabeth Borne said in remarks published on Saturday.

“We will maintain measures to soften the rise in energy prices and we will take specific measures to assist the most vulnerable,” Borne said in an interview with the French daily Le Parisien.

“French people can be reassured, we won’t allow energy prices to skyrocket,” added Borne.

Finance Minister Bruno Le Maire earlier on Saturday told French television channel BFM that increases in electricity prices next year would be limited.

French President Emmanuel Macron said earlier this week that there were “tough months ahead” while his government warned of energy price rises as the war in Ukraine grinds on.

In the coming weeks the French government will have to decide whether to renew price caps on electricity and gas that expire at the end of the year, and whether to maintain a fuel rebate. These two measures have helped keep French inflation lower than many European peers but weigh heavily on public finances.

A government spokesman said last week that France could not hold on to energy price caps to help households forever.

France has committed to capping an increase in regulated electricity costs at 4 per cent until the end of the year. — Reuters

ECB policymakers make the case for a big rate hike

Malay Mail

JACKSON HOLE, Aug 28 — European Central Bank policymakers made the case on Saturday for a large interest rate hike next month as inflation remains uncomfortably high and the public may be losing trust in the bank’s inflation-fighting credentials.

The ECB raised rates by 50 basis points to zero last month and a similar or even bigger move is now expected on Sept 8, partly on sky-high inflation and partly because the US Federal Reserve is also moving in exceptionally large steps.

Speaking at Fed’s annual Jackson Hole Economic Symposium, ECB board member Isabel Schnabel, French Central Bank chief Francois Villeroy de Galhau and Latvian central bank Governor Martins Kazaks all argued for forceful or significant policy action.

“Both the likelihood and the cost of current high inflation becoming entrenched in expectations are uncomfortably high,” Schnabel said. “In this environment, central banks need to act forcefully.”

Markets were betting on a 50 basis point move on Sept 8 until just days ago but a host of policymakers, speaking on and off record, now argue that a 75 basis point move should also be considered.

“Frontloading rate hikes is a reasonable policy choice,” Kazaks, told Reuters. “We should be open to discussing both 50 and 75 basis points as possible moves. From the current perspective, it should at least be 50.”

Rate hikes should then continue, the policymakers argued.

With rates at zero, the ECB is stimulating the economy and remains far from the neutral rate, which is estimated by economists to be around 1.5 per cent.

Villeroy said that the neutral rate should be reached before the end of the year while Kazaks said he would get there in the first quarter of next year.

“In my view, we could be there before the end of the year, after another significant step in September,” Villeroy said.

Schnabel also warned that inflation expectations were now at risk of moving above the ECB’s 2 per cent medium term target, or “de-anchor” and surveys suggested that the public has started to lose trust in central banks.

The rate hikes come even as the euro zone growth slows and the risk of a recession looms.

But the recession will be mostly due to soaring energy costs, against which monetary is powerless. The downturn is also unlikely to weigh on price growth enough bring inflation back to target without policy tightening, many argue.

The looming downturn is an argument to frontload rate hikes as it becomes difficult to communicate policy tightening when the slowdown is already visible.

“With this high inflation, avoiding a recession will be difficult, the risk is substantial and a technical recession is very likely,” Kazaks said. — Reuters

ECB needs another big rate hike in September, Kazaks says

Malay Mail

JACKSON HOLE, Wyoming., Aug 27 — A euro zone recession is now very likely but that alone will not bring down inflation and the European Central Bank should opt for a big rate hike next month, ECB policymaker Martins Kazaks said today.

The ECB raised rates by 50 basis points in July to zero and a similar move is being priced in for Sept 8 but some policymakers have started talking about an even bigger increase as the inflation outlook is deteriorating.

"Frontloading rate hikes is a reasonable policy choice," Kazaks, Latvia's central bank chief, told Reuters. "We should be open to discussing both 50 and 75 basis points as possible moves.

"From the current perspective, it should at least be 50," Kazaks said in an interview on the sidelines of the U.S. Federal Reserve’s Jackson Hole Economic Symposium.

The problem is that at 8.9 per cent, inflation is more than four times the ECB’s target and it is still likely to go higher before a slow retreat.

Underlying inflation, which filters out volatile food and energy prices, is also uncomfortably high, indicating that some of the inflation is now getting embedded in the economy via second round effects.

With rates at zero, the ECB is still supporting the economy and Kazaks said the bank should reach the neutral level, which neither brakes not stimulates the economy, in the first quarter of next year.

"If we see that we need to go beyond the neutral, I have no doubt we will," he said. "If we don’t see significant decreases in core inflation, we may need to go beyond the neutral. But let’s not get ahead of ourselves."

He added that the ECB should reduce its balance sheet at some point but, for now, it should predominantly deal with interest rates.

A complication for the bloc is a looming recession, due primarily to soaring energy prices fuelled by Russia’s war in Ukraine.

While a recession will weigh on inflation, a short and shallow recession, as now expected by many, will not be enough get price growth under control without ECB action.

"With this high inflation, avoiding a recession will be difficult, the risk is substantial and a technical recession is very likely. In Latvia, a recession is part of a baseline scenario," Kazaks added. — Reuters

Dell ceases all Russian operations after August offices closure

Malay Mail

MOSCOW, Aug 28 — Dell Technologies Inc. DELL.N said on Saturday it had ceased all Russian operations after closing its offices in mid-August, the latest in a growing list of Western firms to exit Russia.

The US computer firm, a vital supplier of servers in Russia, has joined others in curtailing operations since Moscow sent tens of thousands of troops into Ukraine on Feb. 24.

Dell suspended sales in Ukraine and Russia in February, saying it would monitor the situation to determine next steps.

“In mid-August, we closed our offices and ceased all Russian operations,” Dell spokesperson Mike Siemienas told Reuters.

“Back in February, we made the decision to not sell, service or support products in Russia, Belarus and the Donetsk and Luhansk regions of Ukraine, in addition to the already embargoed Crimea.”

Russia annexed the Black Sea peninsula of Crimea from Ukraine in 2014 and recognised self-styled, breakaway republics in the Donetsk and Luhansk regions of east Ukraine in February, moves condemned by Ukraine and Western nations, which have imposed sanctions on Russia.

Russia’s industry ministry said on Friday many of the researchers and engineers working for Dell in Russia had already been offered new jobs, after media reports said the company was making a full exit.

Tech-focused publication CNews this week reported that Dell would fully exit Russia and would lay off all its local staff. IT-focused news portal TAdviser published a similar report.

“We are monitoring the development of the situation,” the TASS news agency quoted Deputy Industry and Trade Minister Vasily Shpak as saying on Friday.

“According to our data, the vast majority of Dell’s R&D centre specialists and support engineers in St Petersburg and Moscow have already received job offers with competitive pay from Russian producers.” — Reuters

Japan vows billions at Africa investment conference

Malay Mail

TUNIS, Aug 27 — Japanese Prime Minister Fumio Kishida Saturday pledged US$30 billion (RM134 billion) over three years for Africa in a virtual address to a development conference in Tunis aiming to counter China’s growing continental influence.

The eighth Tokyo International Conference on African Development (TICAD8) takes place amid a “complex” international environment caused by the coronavirus pandemic and the war in Ukraine, the Japanese foreign ministry said.

Host country Tunisia is among the countries bearing the brunt of global supply chain disruptions and price spikes unleashed by these two factors, since it is heavily import dependent and is not an energy player.

In his opening speech, Tunisian President Kais Saied urged delegates to “search together for ways for African peoples to achieve the hopes and dreams of the first generation after independence”.

Praising Japan’s strong track record of development and “preserving” its culture, he said that “the world cannot continue as it was. With all its wealth and assets, Africa cannot watch its people live through poverty.”

Kishida, speaking over live video from Tokyo after testing positive for Covid-19 days earlier, pledged that “Japan will invest both public and private funds worth US$30 billion over the next three years” across Africa.

“To improve the lives of Africans, we will provide up to US$5 billion in co-financing with the African Development Bank,” he said.

The pledge come as China cements its influence on the continent with its “Belt and Road” infrastructure initiative, and as experts express concern about the long-term sustainability of some African nations’ borrowing from Beijing.

Rabat-Tunis Tensions

Japan’s initiative “includes up to US$1 billion in a new special quota to be established by Japan to promote debt consolidation reforms” in Africa, the Japanese premier said.

He also pledged US$300 million in co-financing with the African Development Bank to boost food production, vowing to help African countries weather grain shortages caused by the war in Ukraine, a major wheat producer.

Senegalese President Macky Sall, the current chairman of the African Union, paid tribute to Africa’s “partnership” with Japan, praising “concrete results in the agriculture, health, education and water” sectors.

He also urged a suspension of interest on debt owed to G20 countries, calling for a seat for the continent at the next G20 summit.

On the eve of TICAD, Morocco withdrew from the event and recalled its ambassador from Tunisia for consultations, after Saied hosted the head of Western Sahara’s Polisario secessionist movement.

Tunis in turn said it would recall its own ambassador from Rabat, pointing to its “total neutrality” on Western Sahara, a territory Rabat sees as an integral part of Morocco.

Sall said he “regrets Morocco’s absence”, expressing hopes for a solution to the disagreement.

It is the first TICAD — held every three years either in Japan or an African country — since the coronavirus pandemic began.

The Japanese delegation is led by Foreign Minister Yoshimasa Hayashi, with about 5,000 participants set to attend.

Among those are 48 representatives of African countries, including at least 20 heads of state or government, according to Tunisian diplomatic sources.

A slick promotional video said the conference aims to promote “African development led by African people”.

But no journalists from African news outlets were given access to delegates ahead of the event, except Tunisian state media, alongside Japanese journalists.

The conference has sparked anger among Tunisians as major road closures threatened traffic disruptions in the capital.

Authorities spruced up parts of the city likely to be seen by delegates and dug in roadside plants, but these efforts also drew ire from social media users.

“I feel deeply insulted by the clean-up of Tunis for the TICAD,” one Tunisian wrote on Twitter, arguing that “those we pay to make our lives easier” should instead focus on making the capital livable for citizens all year round. — AFP

Germany extends aid package for energy-intensive firms

Malay Mail

BERLIN, Aug 27 — Germany economy ministry said today it was extending the deadline of a €5 billion (US$4.98 billion) aid package for energy-intensive companies and was refining details of the programme intended to help firms cope with soaring power costs.

Companies can apply until the end of September for subsidies of up to €50 million for their increased natural gas and electricity cost, the ministry said. The previous deadline was the end of August.

It said Germany was working with the European Commission on extending the programme period.

More than 200 firms, mostly medium-sized, companies have sent some 1,000 applications since the programme started in mid-July, the ministry said, adding that the first funding tranche was paid out in early August. — Reuters

Saturday, August 27, 2022

Only 2.5% of federal govt debt is foreign-denominated: Zafrul

KUALA LUMPUR: The claim that Malaysia owes a lot of money to Indonesia is not true as only 2.5 per cent of federal government debts are foreign-denominated, said Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz.

The foreign loans are from various institutions and investors from around the world, among them the United States, Europe, Japan, China, and Singapore.

“So the 2.5 per cent of foreign loans cannot all be from Indonesia, it’s not logical. And the remaining 97.5 per cent of the national debt are domestic loans,” he said in a video that was uploaded on Twitter yesterday.

Tengku Zafrul explained that government borrowings are different from that loans made by individuals.

“One of the ways governments borrow money is through a bond issuance whereby investors will make bids for the rate of return or yield, as well as the amount wanted.

“Investors who bid the lowest rate of return but with the highest loan amount will be selected,” he said, adding that it is rare for a country to make a direct loan from another country. - Bernama

US summer stock rally at risk as September looms

Malay Mail

NEW YORK, Aug 27 — The 10.7 per cent rally in the S&P 500 .SPX from its June lows is stumbling as it runs into what has historically been the toughest month for the US stock market, sparking nerves among some fund managers of a broad sell-off in September.

The S&P has been in a bear market since plummeting early this year as investors priced in the expectation of aggressive Federal Reserve interest rate hikes, but the index has rallied strongly since June, regaining half its losses for the year.

That rebound has been fueled by a combination of strong earnings from bellwether companies and signs that inflation might have peaked, potentially allowing the Fed to slow rate hikes.

But as investors and traders return from summer holidays, some are nervous about a bumpier ride in September, due to seasonal concerns and nervousness about the Fed’s pace of hikes and their economic impact.

The S&P 500 fell nearly 3.4 per cent Friday after Fed Chair Jerome Powell reiterated the central bank’s commitment to taming inflation despite a possible recession.

“These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain,” Powell said in a closely watched speech in Jackson Hole, Wyoming.

September typically is a down month for the stock market because fund managers tend to sell underperforming positions as the end of the third quarter approaches, according to the Stock Trader’s Almanac.

“We’ve had a breathtaking run and I wouldn’t be shocked if the market takes a hit here,” said Jack Janasiewicz, lead portfolio strategist at Natixis Investment Management Solutions.

The S&P 500 could fall as much as 10 per cent in September as investors price in the likelihood that the Fed will not start to cut rates as early as some had hoped, Janasiewicz said.

September has been the worst month for the S&P 500 since 1945, with the index advancing only 44 per cent of the time, the least of any month, according to CFRA data. The S&P 500 has posted an average loss of 0.6 per cent in September, the worst for any month.

The index is down 14.8 per cent year to date and has been in a bear market, hitting its lowest level in June since December 2020 after the Fed announced its largest rate hike since 1994.

Chief among the reasons for the gloomy outlook is a belief that the Fed will continue hiking rates and keep them above neutral longer than markets had anticipated as recently as a week ago, weighing on consumer demand and the housing market.

Nearly half of market participants now expect the Fed funds rate to end the year above 3.7 per cent by the end of the year, up from 40 per cent a week ago, according to the CME FedWatch tool. The fed funds rate is currently between 2.25 and 2.5 per cent.

The Sept. 20-21 FOMC meeting will also likely drive volatility during the month, prompting the S&P 500 to fall near its June lows, said Sam Stovall, chief investment strategist at CFRA. Ahead of that will be critical economic data, such as a reading on consumer prices that will give investors more insight into whether inflation has peaked.

The strong rally since June, however, suggests the index will continue to rebound through December, Stovall said.

“While we might end up retesting the June low, history says that we will not set a new low,” he said.

While fund managers as a whole remain bearish, the ratio of bulls to bears has improved since July, reducing the likelihood of outsized gains in the months ahead, according to Bank of America survey released Aug. 16. The bank’s clients were net sellers of US equities last week for the first time in eight weeks, suggesting that investors are growing more defensive, the bank said.

At the same time, the use of leverage by hedge funds — a proxy for their willingness to take risk — has stabilised since June and is near the lowest level since March 2020, according to Goldman Sachs.

Investors may rotate into technology and other growth stocks that can take market share despite an economic slowdown, said Tiffany Wade, senior portfolio manager at Columbia Threadneedle Investments, who is overweight mega-cap stocks like Amazon.com Inc AMZN.Oand Microsoft CorpMSFT.O.

“We expect the pullback will start with some of the riskier names that have run up a lot since June,” she said. — Reuters

TotalEnergies to sell stake in war-linked Russian gas field

Malay Mail

PARIS, Aug 27 — French energy firm TotalEnergies said Friday it was divesting its stake in a Russian gas field that was reported this week to be providing fuel that ends up in Russian fighter jets.

The company said that it had signed a deal on Friday with its local Russian partner Novatek to sell its 49 per cent in the Termokarstovoye gas field “on economic terms enabling TotalEnergies to recover the outstanding amounts invested in the field.” It said the divestment had been agreed in July and submitted to Russian authorities in early August, with approval coming on August 25.

That was the day after an article appeared in French daily Le Monde reporting the alleged refining of natural gas condensates from Termokarstovoye into jet fuel for fighter-bombers involved in Russia’s assault on Ukraine since February.

TotalEnergies — formerly Total — owns 49 per cent of Terneftegaz, the company that extracts gas from the Termokarstovoye field.

The other 51 per cent is held by Novatek, in which the French firm also holds a 19.4 per cent stake.

TotalEnergies initially said it had no control over the sales of its Russian partner.

On Friday, it said Novatek had denied that its condensates were being refined into Russian military jet fuel.

Instead, they were sent to processing at a refinery whose products are exclusively exported outside Russia, a Novatek statement relayed by the French firm said.

TotalEnergies also said it was considering legal action in a bid to end an “unfounded controversy which is damaging the reputation of the company.” Clara Gonzales at Greenpeace France said that the Termokarstovoye sale must not be a “smokescreen for the ongoing commercial relations of TotalEnergies in Russia,” and called for it to offload its stake in Novatek which “supplies the Russian army”.

“We are grateful to (French President) Emmanuel Macron and the French people for supporting Ukraine. Against this background, it is a disgrace to France when French companies assist the murder of Ukrainians and the ruining of our cities,” Ukrainian Foreign Minister Dmytro Kuleba tweeted Friday.

“TotalEnergies, pull out of Russia!”

‘Exclusively exported’ fuel

Le Monde reported Wednesday that condensates from Termokarstovoye were being sent to a refinery that had provided 42,700 tonnes of fuel from February-July sent to airbases hosting Russian planes.

They accounted for more than eight per cent of the raw materials received at the refinery in Omsk since the invasion of Ukraine, it added.

Citing data from financial information firm Refinitiv, the newspaper said the jet fuel shipments could be tracked back to the by-products from Termokarstovoye.

Novatek said via TotalEnergies that all condensates from the gas field are “delivered to the Ust-Luga processing complex in the Leningrad region.

“The range of products derived during processing at the Ust-Luga complex includes jet fuel that is exclusively exported outside Russia, and it does not even have the certification to be sold inside the country”.

TotalEnergies is the only major Western energy group to continue its operations in Russia, which accounts for 16.6 per cent of its hydrocarbon production and 30 per cent of its gas.

Chief executive Patrick Pouyanne had said in March that Russian gas fields exploited by the company’s joint ventures “are going to operate whether I leave or not” and are vital for supplying energy to Europe.

Selling TotalEnergies’ assets at knock-down prices would amount to handing billions to Russian investors, he argued.

But the firm has since announced a partial withdrawal from Russia, including stopping financing the Arctic LNG 2 gas project.

In July, it sold its 20-per cent stake in an Arctic oil field to Russia’s Zarubejneft. — AFP

AtOneGoFinancial Blog

Wednesday, August 31, 2022

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Tuesday, August 30, 2022

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Monday, August 29, 2022

Tax Matters – The increasing importance of managing tax risks

Langkawi eyes premium retail, healthcare, education investors

Don’t be tempted by the recent crypto rally

Japan vows to work for ‘more resilient’ African economies

Innovative tech to unburden contact centre workers in Malaysia

Germany says gas stocks rising quicker than expected

Sunday, August 28, 2022

France to keep curbing hikes in households’ energy costs

ECB policymakers make the case for a big rate hike

ECB needs another big rate hike in September, Kazaks says

Dell ceases all Russian operations after August offices closure

Japan vows billions at Africa investment conference

Germany extends aid package for energy-intensive firms

Saturday, August 27, 2022

Only 2.5% of federal govt debt is foreign-denominated: Zafrul

US summer stock rally at risk as September looms

TotalEnergies to sell stake in war-linked Russian gas field

Eating Meat Is Now Linked to Another Major Disease (As If Cancer Isn’t Enough)

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