FRANKFURT: German heavy industry giant ThyssenKrupp and Indian group Tata agreed Wednesday to merge their steel operations in Europe, sending governments and unions scrambling to ward off job cuts.
Once the deal is finalized in 2018, the two groups aim for efficiency savings of between €400 and €600 million ($480-720 million) per year and are likely to shed 4,000 jobs in production and administration.
The combination would create Europe’s second-largest steelmaker after ArcelorMittal, expected to produce around 21 million tons of steel per year for sales of €15 billion.
The two sides plan a 50-50 joint venture, named “ThyssenKrupp Tata Steel,” as a holding company in the Netherlands with joint management that will employ some 48,000 people across 34 sites.
“We have found a European solution for a European industry,” ThyssenKrupp chief executive Heinrich Hiesinger told reporters.
He said the planned job cuts would be shared evenly with Tata, with ThyssenKrupp shedding a thousand jobs in production and another thousand in administration.
“This is not a pretty number, and it would not have been any better if we had stayed on our own,” Hiesinger said.
The merger comes as Europe and the United States have long complained of massive gluts in the world steel market caused by overproduction in China, with Washington launching investigations into the national security implications of Chinese competition.
“The steel industry has faced massive challenges in Europe for many years,” ThyssenKrupp, an industrial conglomerate whose products range from lifts to car parts and submarines, said in a statement.
“Steel demand is characterized by a lack of dynamic. There is structural overcapacity in supply and constantly high import pressure,” it said.
This meant that various stages in the value chain were operating well below capacity.
Unless industry players took action, the group warned, major steel assets would come “under threat of closure in the medium term.”
For his part, Tata Steel chairman Natarajan Chandrasekaran said the partnership agreement was a “momentous occasion” for two firms who “share similar culture and values.”
The “declaration of intent” signed by both sides must still be approved by competition authorities.
Worker representatives in Germany, where ThyssenKrupp employs some 27,000 people in its steel division, were quick to voice fears over the planned tie-up.
“The board has bet everything on a single card in the face of all the warnings,” works council chief Guenter Back told news agency DPA, adding that “significantly more” job cuts would likely follow those announced Wednesday.
Trade unions at ThyssenKrupp have for months been fearing news of job losses, enlisting help from Berlin to put pressure on the firm.
“No solution can be imagined that runs contrary to the workers,” Vice-Chancellor Sigmar Gabriel declared Monday after powerful union IG Metall complained of a “total dearth of information” from executives about their plans.
The jobs tussle is set to intensify at the weekend, as ThyssenKrupp must submit the plan to its supervisory board — where worker representatives hold half of the seats — for approval.
IG Metall plans a demonstration by “thousands” of workers in the western German city of Bochum on Friday, a spokesman told AFP.
Protesters will call for “transparency” in the merger process and “security for jobs, for workplaces, the preservation of the German model of employee participation,” union spokesman Mike Schuerg told AFP.
More upbeat than Germany’s Gabriel, British business minister Greg Clark hailed an “important step” for the island nation’s steel industry.
London hopes the deal will secure the future of Tata’s 4,000-strong site at Port Talbot in Wales, which sits at the heart of the local economy.
“As always, the devil will be in the detail and we are seeking further assurances on jobs, investment and future production” in the UK, said trade union representative Roy Rickhuss, while adding that workers “recognize the industrial logic of such a partnership.”
ThyssenKrupp-Tata Steel merger sets scene for jobs battle
ThyssenKrupp-Tata Steel merger sets scene for jobs battle
Japan, Saudi medical centers unite to revolutionize stem cell therapy
- Cytori Therapeutics K.K., has been a pioneer in the stem cell therapy business
TOKYO: Cytori Therapeutics Japan and the King Abdullah International Medical Research Center have signed a Memorandum of Understanding to strengthen research and training initiatives in the field of cell therapy.
The signing ceremony took place between Dr. Ahmed Alaskar, executive director of KAIMRC, and Hoshino Yoshihiro, president and CEO of Cytori Therapeutics K.K., during the Riyadh Global Medical Biotechnology Summit 2024.
The partnership underscores the potential of regenerative medicine in treating chronic diseases such as diabetes, liver cirrhosis, critical limb ischemia, chronic wounds, knee osteoarthritis and other aging-related conditions. The aim of combining Cytori’s cutting-edge stem cell technology with KAIMRC’s expertise in translational research is to develop groundbreaking treatments for these critical health issues.
The two organizations will collaborate on fundamental research, clinical trials and other areas of mutual interest, including projects in biomedical R&D, preclinical studies and clinical trials, as well as training and development for staff in health-related and engineering fields.
Cytori Therapeutics K.K., has been a pioneer in the stem cell therapy business, specializing in cell therapy services and the development of adipose-derived regenerative cells from human subcutaneous fat tissues for therapeutic use. The company also develops, manufactures, and exports medical devices.
This article is also available on Arab News Japan
Oil Updates – prices little changed as market weighs mixed drivers
SINGAPORE: Oil prices held steady for a second day on Wednesday as concerns about escalating hostilities in the Ukraine war potentially disrupting oil supply from Russia and signs of growing Chinese crude imports offset data showing US crude stocks rising.
Brent crude futures dipped 5 cents to $73.26 a barrel by 8:41 a.m. Saudi time. US West Texas Intermediate crude futures was flat at $69.39 per barrel.
The escalating war between major oil producer Russia and Ukraine has kept a floor under the market this week.
“We may expect (Brent) oil prices to stay supported above the $70 level for now, as market participants continue to monitor the geopolitical developments,” said Yeap Jun Rong, market strategist at IG.
On Tuesday, Ukraine used US ATACMS missiles to strike Russian territory for the first time, Moscow said. Russian President Vladimir Putin lowered the bar for a possible nuclear attack.
“This marks a renewed build up in tensions in the Russia-Ukraine war and brings back into focus the risk of supply disruptions in the oil market,” ANZ analysts said in a note to clients.
On the demand side, US crude oil stocks rose by 4.75 million barrels in the week ended Nov. 15, market sources said on Tuesday, citing American Petroleum Institute figures.
That was a bigger build than the 100,000 barrel increase analysts polled by Reuters were expecting.
Gasoline inventories, however, fell by 2.48 million barrels, compared with analysts’ expectations for a 900,000-barrel increase.
Distillate stocks also fell, shedding 688,000 barrels last week, the sources said.
Official government data is due later on Wednesday.
In a boost to oil price sentiment, there were signs that China, the world’s largest crude importer, may have stepped up oil purchases this month after a period of weak imports.
Data from vessel tracker Kpler showed China’s crude imports are on track to end November at or close to record highs, an analyst told Reuters.
Weak imports by China so far this year have pulled down oil prices, with Brent sinking 20 percent from its April peak of more than $92 a barrel.
Saudi Arabia raises $910m in November sukuk offering
RIYADH: Saudi Arabia’s National Debt Management Center has completed its riyal-denominated sukuk issuance for November, raising SR3.41 billion ($910 million), a 28.19 percent year-on-year increase.
In October, the Kingdom issued sukuk worth SR7.83 billion, while the figures for September and August were SR2.6 billion and SR6.01 billion, respectively.
Sukuk, also known as Islamic bonds, are Shariah-compliant debt products that allow investors to gain partial ownership of an issuer’s assets until maturity.
Saudi Arabia’s consistent sukuk issuances align with a report released by Moody’s in September, which stated that the global markets for these Islamic bonds are expected to remain strong in 2024.
The report also projected that the issuance of Shariah-compliant bonds could reach between $200 billion and $210 billion this year, up from just under $200 billion in 2023.
According to a statement by the NDMC, the November sukuk issuance was divided into five tranches. The first tranche, valued at SR2.52 billion, is set to mature in 2029.
The second tranche was valued at SR434 million and will mature in 2031, while the third tranche amounted to SR137 million, with a maturity date in 2034.
NDMC stated that the fourth tranche, sized at SR10 million, is scheduled to mature in 2036. The fifth tranche, valued at SR310 million, will mature in 2039.
A report by Fitch Ratings in October highlighted that sukuk issuances are on the rise, driven by improving financing conditions following the US Federal Reserve’s rate cuts to 5 percent in September.
Fitch noted that global sukuk outstanding reached $900 billion by the end of the third quarter of 2024, an 8.5 percent increase compared to the same period in 2023.
The report further projected that interest rates could decline to 4.5 percent by the end of 2024 and 3.5 percent in 2025, likely boosting sukuk issuances in the short term.
In August, Fitch reported that the UK remains a significant hub for Islamic finance, with the London Stock Exchange ranking as the third-largest listing venue for US dollar sukuk globally.
Saudi Arabia’s continued momentum in sukuk issuances reflects its commitment to developing the Islamic finance market as a core component of its Vision 2030 economic diversification strategy.
Developing nations push for action on COP29 financing shortfalls
RIYADH: Developed nations are facing growing pressure at COP29 to honor their climate finance commitments, as developing countries push for action to address the severe shortfalls in adaptation funding and the escalating environmental challenges they face.
The ongoing dispute centers around how much support developed nations will provide to poorer countries in their efforts to combat the impacts of climate change.
Representatives from vulnerable nations have emphasized the urgent need for concrete financial commitments, highlighting the widening gaps in adaptation funding.
Financing gaps undermine efforts
Kenya called for an end to the adaptation finance gap, urging increased financial flows to meet the continent’s needs. “Developing countries are not receiving the resources they need,” said Kenya’s representative. “Africa’s adaptation needs are the highest globally, estimated at $845 billion between 2020 and 2035, yet we receive less than a quarter of that annually.”
Bangladesh echoed these concerns, revealing a stark $5.5 billion annual shortfall in funding for resilience projects. “This gap must be filled through grant-based and external finance,” said Bangladesh’s representative.
Several developed nations have outlined their efforts to scale up adaptation financing. Germany highlighted that 30 percent of the EU’s current seven-year budget is allocated to climate-related initiatives, including $30 billion for nationally determined contributions and climate goals, and $12 billion for public climate adaptation finance.
France pledged €2 billion annually by 2025 for adaptation in developing countries, exceeding its previous commitments. Canada reported progress toward its goal of doubling adaptation finance by 2025, as per the Glasgow Climate Pact, but acknowledged the need for more expansive action. “Public finance alone won’t suffice,” said Canada’s representative. “We need coordinated global efforts, innovative instruments, and stronger policy signals to ramp up climate-resilient investments,” the representative continued.
UAE calls for scaling up adaptation finance
“The outcome of the first global stocktake under the UAE consensus underscores a stark reality: we are not on track to meet the adaptation needs of developing countries,” said the UAE’s representative. “Climate change disproportionately affects vulnerable communities who have contributed the least to global emissions. Adaptation is not a choice, but a necessity,” he continued.
The UAE underscored the widening adaptation finance gap, which is estimated to reach hundreds of billions of dollars annually by 2030.
“A critical component of COP28 was the UAE framework for global climate resilience, establishing targets for adaptation planning and implementation,” the representative noted. The UAE consensus calls for all parties to have national adaptation plans in place by 2025, with tangible progress on implementation by 2030.
“We urge developed countries to significantly scale up adaptation finance beyond the doubling committed at COP26,” the UAE added.
“This scaling up is crucial to meet the urgent and growing needs of developing countries.”
Rejecting allegations of involvement in the Sudanese conflict, the UAE reaffirmed its commitment to humanitarian aid and efforts to support a legitimate, civilian-led government in Sudan.
“We reject these baseless claims and emphasize our continued support for de-escalation, ceasefires, and aiding Sudanese civilians,” said the representative.
Jordan called for “predictable and transparent commitments” and expedited disbursements, emphasizing the challenges faced by water-scarce nations grappling with severe droughts.
Sudan urged for technological transfer and funding to recover from devastating floods, which caused $48 million in damages this year. Palestine raised concerns about barriers to accessing climate funds, citing “non-technical issues” that prevent direct support despite eligibility.
Kazakhstan stressed the importance of concessional financing, saying, “We need mechanisms that are accessible and predictable to address vulnerabilities and ensure funds flow directly to communities.”
Developing countries call for urgent action
“Adaptation is not a choice but a necessity,” reiterated the UAE representative, highlighting the disproportionate burden borne by vulnerable nations.
Qatar called for creative solutions to close the adaptation finance gap, urging developed countries to double financial support and focus on the implementation phases to maximize impact.
China demanded that developed countries clarify timelines for doubling adaptation financing, stating, “They must deliver on their commitments and prioritize vulnerable nations.”
As COP29 unfolds, the debate over adaptation financing underscores the urgent need to bridge the gap between pledges and tangible action. The world’s most vulnerable communities are watching closely, demanding that words translate into real solutions.
GAMI showcases achievements at maritime forum in Dhahran
RIYADH: Saudi Arabia’s General Authority for Military Industries highlighted its achievements in local military ship and boat manufacturing, as well as maintenance capabilities, at the 3rd International Saudi Maritime Forum.
In a press statement, GAMI noted that its pavilion also showcased specialized expertise in hull construction and system integration. Established in 2017, GAMI is tasked with regulating, monitoring, enabling, and licensing the Kingdom's military and security industries.
As part of its mission to strengthen the defense sector, GAMI aims to support the growth of Saudi Arabia's military industries and contribute to the country's economic development. The authority also plays a key role in achieving Saudi Vision 2030 by aiming to localize more than 50 percent of government defense spending by 2030.
The GAMI pavilion, inaugurated by Abdullah bin Abdulaziz Al-Hammad, GAMI’s deputy governor for strategic planning and execution, was presented to over 55 national and international organizations from 22 countries, including military specialists and academics from both Saudi Arabia and abroad.
The 3rd Saudi International Maritime Forum, organized by the Royal Saudi Naval Forces, kicked off on Nov. 19 in Dhahran and will run through Nov. 21.
The forum is focusing on key developments in regional and international maritime security, while also highlighting the latest technologies, equipment, and maritime systems at both local and global levels.
