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The National
28-05-2025
- Business
- The National
Deposits from Gulf states 'critical' for Syria's financial reform amid low foreign exchange reserves
Gulf countries are likely to play a major role in backing Syria's urgent efforts to reform its financial system, as the country's economy seeks to recover when international sanctions are lifted. Financial deposits from Gulf allies will support Syria's monetary stability and rebuild confidence in its commercial banking system as the country grapples with near-depleted foreign exchange reserves, analysts said. "Extremely low levels of foreign-denominated cash reserves are proving debilitating for the Central Bank of Syria, preventing it from stabilising the currency and supporting the commercial banking sector,' Dominic Pratt, senior analyst at the Economist Intelligence Unit (EIU), told The National. "Securing liquidity injections will be crucial to address these issues, and deposits from Gulf partners in particular will be critical given a lack of alternatives as balance of payment pressures remain high.' Deposits from Gulf partners in particular will be critical given a lack of alternatives as balance of payment pressures remain high Dominic Pratt , senior analyst at Economist Intelligence Unit Gulf states have a record of providing large-scale financial assistance to distressed economies in the region, which Syria can benefit from as it requires "substantial external inflows', said Hani Abuagla, senior market analyst at XTB Mena. "Deposits from Saudi Arabia, Qatar, and the UAE could provide immediate support. This approach has been employed in other crisis-hit economies to restore market confidence and prevent currency collapses,' he said. Gulf states can support Syria's financial system through several channels: A direct and immediate measure is to place foreign currency deposits with the Syrian Central Bank, helping to rebuild reserves and stabilise the exchange rate, Mr Abuagla said. Another way is financing urgent government expenditures, such as public-sector workers' wages, while long-term support could include equity injections into local banks or into infrastructure investments. Support from Gulf countries could also take the form of currency swaps, direct transfers to the central bank, concessional lending or asset trading, Mr Pratt said. Asset sales in return for foreign currency liquidity, similar to the UAE's deal with Egypt to develop the Ras Al Hekma project, is a model that can be applied in Syria, analysts said. Backing by Gulf countries in the form of foreign direct investments into projects in Syria would increase the inflow of foreign currency into the cash-strapped country, said Ibrahim Nafeh Koshaji, a Syria-based economic and banking analyst. Such a move will also improve its business environment by introducing advanced managerial and technological know-how. An employee counts money at a bank in Damascus, Syria. Banks in the Syrian capital resumed operations after Bashar Al Assad was forced from office. EPA However, foreign financial assistance often comes with strings attached and Syria is no exception, analysts said. "This type of assistance is rarely unconditional. Gulf countries would likely link their financial aid to political concessions, governance improvements and signs of serious economic reform,' Vijay Valecha, chief investment officer at Century Financial, said. "Without these, large-scale deposits could be withheld or limited to symbolic gestures.' But without near-term access to international capital markets or IMF programmes, "Gulf support remains one of the few viable paths to easing Syria's immediate external constraints', he added. War's economic toll Syria emerging from the overthrow of the Bashar Al Assad regime in December is facing the Herculean tasks of rebuilding its economy, repairing hollowed out institutions and returning to global capital markets after decades of isolation. The Syrian economy has been devastated by the civil war, which began in 2011. The UN's Development Programme estimates cumulative losses – including physical damage ($123.3 billion) and economic deprivation – of $923 billion at the end of 2024. The Syrian GDP has about halved in size since 2010 to around $21 billion in 2024, according to Bloomberg Economics calculations using World Bank data. Syria is already getting signals of interest from Gulf countries to support its economic revival. DP World – the Dubai-based global ports operator – signed an $800 million initial agreement with the Syrian government to develop and expand the north-western port of Tartus. Qatar Airways was one of the first airlines to resume flights to Damascus International Airport back in January, while UAE carrier flydubai said this month it will restart service to the Syrian capital in June. 'Pivotal' opportunity after sanctions removal US President Donald Trump, during a Gulf tour this month, announced the lifting of sanctions ahead of a landmark meeting with Syrian leader Ahmad Al Shara in Riyadh. Shortly after, the EU followed suit. Removal of US and EU sanctions will be " transformative' for Syria's banking regulator, commercial lenders and the financial sector, Mr Pratt said. The lifting of sanctions will help Syria in ending decades of isolation, opening up new credit lines and financial support and providing an opportunity to initiate critical, and long overdue reforms, he said. A sanctions-free economy is a "pivotal' opportunity for the central bank to implement structural reforms, according to Mr Abuagla. Without restrictions, Syria could re-enter the global financial system, reestablish access to Swift, speed remittances and revive trade flows. The recovery of frozen foreign assets would boost reserves, while some international banks have reportedly expressed interest in entering the Syrian market once sanctions are lifted. The clearance of its debt with the World Bank has also made Syria eligible for credit lines and reconstruction funding. The World Bank cleared Syria of its $15.5 million outstanding debt this month after Saudi Arabia and Qatar paid for it. The clearing of the arrears reinstates Syria's eligibility to receive World Bank support and operations after a 14-year hiatus. Saudi Arabia and Qatar announced their plans to settle Syria's outstanding debts on April 27, in "support of and to accelerate the recovery' of Syria. "The resumption of support from the World Bank and the IMF would also unlock funding and technical guidance essential for successful reform,' Mr Abuagla added. Syria's central bank governor Abdul Kader Husriyeh taking the oath of office in Damascus. AFP 'Comprehensive' reform agenda Syria's Central Bank Governor Abdul Kader Husriyeh, who was appointed in April, told The National this week among top priorities are updating monetary policy; reviewing banking legislation; strengthening anti-money laundering measures and engaging with foreign depositors, including sovereign entities. To achieve its goal of reforming Syria's financial system, the central bank requires a rules-based policy framework to control inflation and build investor confidence, analysts say. Also required is stabilising the exchange rate to control the volatility that deters foreign investments, Mr Abuagla said. Institutional reforms would attract the Syrian diaspora to invest their money back home, which means these funds could return if the domestic banking system becomes more stable. Mr Koshaji said the key requirements for reform are modernising banking operations and granting the central bank full autonomy from political interference,. Establishing a specialised advisory board to manage new money supply through open market mechanisms and removing restrictions on withdrawals and deposits are also important, he said. Launching government bonds in Syrian pounds and US dollars and strengthening the Damascus Securities Exchange as a funding channel for reconstruction projects will also help reform efforts, Mr Koshaji added. Vikram%20Vedha %3Cp%3E%3Cstrong%3EDirectors%3A%3C%2Fstrong%3E%20Gayatri%2C%20Pushkar%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20Hrithik%20Roshan%2C%20Saif%20Ali%20Khan%2C%20Radhika%20Apte%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%C2%A0%3C%2Fstrong%3E3.5%2F5%3C%2Fp%3E%0A RACE CARD 4pm Al Bastakiya – Listed (TB) $150,000 (Dirt) 1,900m 4.35pm Dubai City Of Gold – Group 2 (TB) $228,000 (Turf) 2,410m 5.10pm Mahab Al Shimaal – Group 3 (TB) $228,000 (D) 1,200m 5.45pm Burj Nahaar – Group 3 (TB) $228,000 (D) 1,600m 6.20pm Jebel Hatta – Group 1 (TB) $260,000 (T) 1,800m 6.55pm Al Maktoum Challenge Round-1 – Group 1 (TB) $390,000 (D) 2,000m 7.30pm Nad Al Sheba – Group 3 (TB) $228,000 (T) 1,200m EXPATS %3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Lulu%20Wang%26nbsp%3B%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20Nicole%20Kidman%2C%20Sarayu%20Blue%2C%20Ji-young%20Yoo%2C%20Brian%20Tee%2C%20Jack%20Huston%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%3C%2Fstrong%3E%204%2F5%3C%2Fp%3E%0A Racecard 6.30pm: Mazrat Al Ruwayah Group Two (PA) US$55,000 (Dirt) 1,600m 7.05pm: Meydan Trophy (TB) $100,000 (Turf) 1,900m 7.40pm: Handicap (TB) $135,000 (D) 1,200m 8.15pm: Balanchine Group Two (TB) $250,000 (T) 1,800m 8.50pm: Handicap (TB) $135,000 (T) 1,000m 9.25pm: Firebreak Stakes Group Three (TB) $200,000 (D) 1,600m 10pm: Handicap (TB) $175,000 (T) 2,410m The National selections: 6.30pm: RM Lam Tara, 7.05pm: Al Mukhtar Star, 7.40pm: Bochart, 8.15pm: Magic Lily, 8.50pm: Roulston Scar, 9.25pm: Quip, 10pm: Jalmoud Sinopharm vaccine explained The Sinopharm vaccine was created using techniques that have been around for decades. 'This is an inactivated vaccine. Simply what it means is that the virus is taken, cultured and inactivated," said Dr Nawal Al Kaabi, chair of the UAE's National Covid-19 Clinical Management Committee. "What is left is a skeleton of the virus so it looks like a virus, but it is not live." This is then injected into the body. "The body will recognise it and form antibodies but because it is inactive, we will need more than one dose. The body will not develop immunity with one dose," she said. "You have to be exposed more than one time to what we call the antigen." The vaccine should offer protection for at least months, but no one knows how long beyond that. Dr Al Kaabi said early vaccine volunteers in China were given shots last spring and still have antibodies today. 'Since it is inactivated, it will not last forever," she said. 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Fasting 2. Prayer 3. Hajj 4. Shahada 5. Zakat THE BIO Mr Al Qassimi is 37 and lives in Dubai He is a keen drummer and loves gardening His favourite way to unwind is spending time with his two children and cooking Gulf Men's League final Dubai Hurricanes 24-12 Abu Dhabi Harlequins OPTA'S PREDICTED TABLE 1. Liverpool 101 points 2. Manchester City 80 3. Leicester 67 4. Chelsea 63 5. Manchester United 61 6. Tottenham 58 7. Wolves 56 8. Arsenal 56 9. Sheffield United 55 10. Everton 50 11. Burnley 49 12. Crystal Palace 49 13. Newcastle 46 14. Southampton 44 15. West Ham 39 16. Brighton 37 17. Watford 36 18. Bournemouth 36 19. Aston Villa 32 20. 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NBC News
21-05-2025
- Business
- NBC News
Nvidia CEO hails Trump's plan to rescind some export curbs on AI chips to China
TAIPEI, Taiwan — The head of American chipmaker Nvidia praised President Donald Trump 's move to modify U.S. curbs on the export of artificial intelligence chips to China, saying Wednesday that the Biden-era controls were a 'failure' that had cost his and other U.S. companies billions of dollars in sales. Under former President Joe Biden, the United States rolled out a three-tiered system of export curbs on advanced chips aimed at regulating the global diffusion of AI, blocking China entirely. While Biden said the curbs were necessary to slow China's development of technology that could have military applications, critics said they could undermine U.S. tech leadership. The Trump administration said last week that it plans to rescind some of those curbs and replace them with its own restrictions. Nvidia's billionaire chief executive, Jensen Huang, said his company controls 50% of the market in China today, compared with almost 95% at the start of the Biden administration in 2021. 'All in all, the export control was a failure,' he told reporters at Computex, a top technology trade show in the Taiwanese capital of Taipei, saying the curbs were based on the 'fundamentally flawed' assumption that the U.S. is the only source of AI technology. Huang, 62, said Chinese companies blocked from buying American products had instead turned to local sources such as Chinese tech giant Huawei, and that they had been spurred to make advances with as little outside help as possible. 'The local companies are very, very talented and very determined,' Huang said, 'and the export control gave them the spirit, the energy and the government support to accelerate their development.' Those companies 'would love for us never to go back to China,' he said, adding that China is home to 50% of the world's AI researchers and has an AI market he estimated would be worth $50 billion by next year. Nvidia said last month that it would write off about $5.5 billion in H20 AI chips it had specifically designed for the China market to comply with previous curbs after the Trump administration said those chips would also be restricted. 'I really do hope that the U.S. government recognizes that the ban is not effective and give us a chance to go back and win the market as soon as possible,' Huang said. Huang, who was with Trump on his Middle East trip last week along with other tech leaders, lauded the president for his 'great reversal' of Biden's policy, known as the AI diffusion rule, saying Trump 'realizes it's exactly the wrong goal.' 'He sees it very clearly that the race is on,' Huang said, 'and if the United States wants to stay ahead, we need to maximize, accelerate our diffusion, not limit it, because somebody else is more than happy to provide it.' China's state-led investment in chips has probably exceeded $150 billion over the past decade, according to the Economi st Intelligence Unit. Beijing has repeatedly criticized the U.S. over its chip curbs, including guidelines Washington issued last week that said companies anywhere in the world risked violating U.S. export controls if they used advanced Chinese chips such as Huawei's Ascend without a license. The Chinese Ministry of Commerce said Monday that the U.S. action 'seriously undermines' the consensus the U.S. and China reached earlier this month on slashing their tariffs on each other's goods. On Wednesday, the ministry further accused the U.S. of 'abusing export controls to suppress and contain China.' It pledged to invoke China's anti-foreign sanctions law against anyone involved in enforcing the U.S. move, slamming it as 'a typical example of unilateral bullying and protectionism.'
CNBC
20-05-2025
- Business
- CNBC
Chinese businesses stick to diversifying away from the U.S. despite trade truce, survey shows
The intense trade war with the U.S. has left lasting scars on Chinese exporters with many looking to diversify away from the U.S., despite the temporary tariff reprieves, a private survey found. Based on a poll of 4,500 exporters across several major economies, trade insurer Allianz Trade found that 95% of Chinese exporters surveyed are planning on, if not already, doubling down on exporting to markets outside the U.S. for their goods. The U.S.-China "decoupling" remains a likely scenario over the medium term, the survey said, as Chinese exporters look to pivot away from the U.S. and American firms accelerate efforts to shift production out of China. An increasing number of firms surveyed are expecting a dent on export turnover this year due to the double-digit U.S. tariffs, the report said. Even after the temporary tariff reduction following Beijing-Washington's deal in Switzerland earlier this month, the U.S. trade-weighted tariff rate on Chinese goods remained at 39%, well above the 13% rate applied before the second Trump administration, according to Allianz Trade estimates. The rapid de-escalation of the tariff spat has led to a large spike in U.S.-bound shipments as exporters front-load orders during the 90-day grace period, pushing up freight rates. Chinese exporters in the coastal city of Ningbo are undeterred by the truce, and sticking with their plans to "go global", said Tianchen Xu, senior economist at Economist Intelligence Unit. In a recent report on a field visit to the city, which hosts China's second largest port by cargo handled after Shanghai, Xu said Southeast Asia remained the top choice among local businesses seeking to move production overseas. In Southeast Asia, companies show growing interests in setting up production in Indonesia, Xu said. On the other hand, perception was mixed about Vietnam, with concerns over rising costs weighing against an attractive labor force. While the U.S. has hammered out trade deals with China and the U.K, talks with other long trading partners seem to have stalled. Allianz Trade points out a sobering reality that global exports could see a loss of $305 billion this year on the back of the widespread trade conflicts. In comparison, global trade hit a record $33 trillion last year, according to the United Nations Trade and Development.
Yahoo
12-05-2025
- Business
- Yahoo
U.S. and China agree to slash reciprocal tariffs in major step toward easing trade war
HONG KONG — The United States and China said Monday they had agreed to a 90-day pause on most of the tariffs they have imposed on each other since last month, in a major step toward easing a trade war between the two powers that has rattled the global economy. U.S. tariffs on Chinese imports will be cut to 30% from 145%, while China's levies on U.S. imports will be cut to 10% from 125%, the two countries said in a joint statement. The announcement comes after officials from the two countries met in Geneva, Switzerland, over the weekend for their first face-to-face talks on the tariffs, which began mounting after President Donald Trump's April 2 announcement of sweeping global duties. The tariffs have made trade between the world's two largest economies all but impossible and threatened to upend the global economy. 'We were able to have very constructive and positive conversations with our Chinese counterparts, who clearly came to deal this week,' U.S. Trade Representative Jamieson Greer said at a news conference in Geneva. The Chinese Ministry of Commerce said the agreement was an 'important step' and 'creates favorable conditions for further narrowing differences and deepening cooperation.' 'It is hoped that the U.S. will build on the foundation of this meeting, continue to work in the same direction with China' and 'completely correct its unilateral tariff practices,' a spokesperson said. The two countries said they would also 'establish a mechanism to continue discussions about economic and trade relations.' The U.S. will continue to be represented by Treasury Secretary Scott Bessent and Greer, while China will continue to be represented by Vice Premier He Lifeng. The discussions may take place alternately in China and the U.S., or in a third country agreed upon by both countries. The two sides may also conduct working-level consultations on relevant economic and trade issues. The afternoon announcement sent Hong Kong's Hang Seng index soaring and the Chinese index closed more than 3% up. Mainland Chinese markets closed higher before details of the agreement were released. European indexes were also trading higher early Monday, with U.S. stocks leaping in pre-market trading. The Dow Jones Industrial Average was up 2% and the S&P 500 index was up 2.6%. Markets across Asia had upbeat sessions Monday in anticipation of some kind of agreement from the U.S.-China talks, as well as a ceasefire between India and Pakistan that seems to be holding after conflict erupted between the two South Asian rivals last week. The U.S.-China tariff agreement 'will save medium and small enterprises on both sides of the Pacific,' said Tianchen Xu, a Beijing-based economist at the Economist Intelligence Unit, a financial forecasting service. It will come as 'a very big relief for struggling small Chinese exporters, some of which have already lost U.S. orders for weeks,' he said in emailed comments. U.S. importers, meanwhile, 'will be able to avoid a surge in import costs,' he said. 'This carries positive implications for the overall economy and the labor market.' The agreement exceeded expectations and has 'rekindled global hope,' said Wang Wen, dean of the Chongyang Institute for Financial Studies at Renmin University of China. But Xu and Wang both cautioned that many difficult issues remain to be resolved and the trade war could potentially reignite. 'This situation is a major test of the political wisdom and negotiation capability of the decision-makers in both China and the U.S.,' Wang said. This is a developing story. Please check back for updates. This article was originally published on
Business Recorder
07-05-2025
- Business
- Business Recorder
China central bank eases policy ahead of US trade meeting
BEIJING: China's central bank governor on Wednesday flagged interest rate cuts and a liquidity injection into the banking system, among other monetary policy easing measures aimed at mitigating the impact of a trade war with the United States. The announcement comes shortly after U.S. and Chinese officials said U.S. Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet China's top economic official He Lifeng in Switzerland this weekend for talks. China's central bank will lower the borrowing cost of its seven-day reverse repurchase agreements, its benchmark interest rate, by 10 basis points (bps) to 1.40%, effective May 8. Other interest rates will drop in line with the key rate. The amount of cash that banks must hold as reserves, known as the reserve requirement ratio (RRR), will also be cut by 50 bps, bringing the average level to 6.2%. China's central bank, regulators hold symposium on support for private companies The People's Bank of China's Governor Pan Gongsheng told a news briefing the first RRR cut since September last year will release 1 trillion yuan ($138 billion) in liquidity. Pan also said the central bank will enhance some structural lending tools. Policymakers have been flagging monetary policy easing moves since late 2024, but had held fire while the yuan currency was under pressure, fearing capital outflows, analysts said. A slightly stronger yuan in recent days may have given the central bank an opening. 'A weaker dollar certainly gives China more room to make monetary adjustments,' said Xu Tianchen, senior economist at the Economist Intelligence Unit. 'I don't have very high expectations of the credit impact of these measures,' said Xu, but added they 'inject renewed confidence, which will support the stock market.' Washington's triple-digit tariffs on imports from China have started to bite into the growth prospects of the world's second-largest economy. Factory activity contracted at the fastest speed in 16 months, while services activity expanded at the slowest pace in seven months in April. China is taking measures to support its economy and markets because of the trade war with the United States, said Xing Zhaopeng, senior China strategist at ANZ. 'The domestic economy must be strong enough before (China) kicks off any protracted trade negotiations,' Xing said.
