BEIJING: China’s Premier Li Keqiang has voiced hopes that Beijing and the US can avoid a trade war, telling the close of the annual parliament session that China will open its economy further to allow foreign and Chinese firms to compete on an equal footing.
Fears of a global trade war mounted after US President Donald Trump imposed hefty import tariffs on steel and aluminum earlier this month and, according to sources in Washington, the US is set to unveil new tariffs targeting China by the end of this week.
“I hope both China and the US will act rationally and not be led by emotions, and avoid a trade war,” Li told reporters in a televised news conference at the Great Hall of the People in Beijing.
Those hopes would be damaged if, as sources say, Washington goes ahead with plans for new tariffs on up to $60 billion-worth of Chinese technology and consumer goods annually, in a move to fulfil Trump’s campaign promises to get tough on China and its trade practices.
Earlier on Tuesday, riding high after China’s largely rubber-stamp parliament unanimously re-elected him and set the stage for him to rule indefinitely, President Xi Jinping warned self-ruled Taiwan it would face the “punishment of history” for any attempt at separatism.
The warning came just days after Trump angered Beijing by signing into law legislation encouraging closer ties between Taiwan and the US.
But for the world, the potential fallout from any trade conflict between its two biggest economies posed the more pressing danger.
Without going into detail, Li told his annual press conference that China will improve access to its services and manufacturing sectors while further lowering import tariffs, including those on cancer-related drugs.
“China’s economy has been so integrated with the world’s that closing China’s door would mean blocking our way for development,” Li said.
“China’s aim is to ensure that both domestic and foreign firms, and companies under all kinds of ownership structure, will be able to compete on fair terms in China’s large market.”
During his half-hour closing speech, President Xi was heavy on aspirational themes, and he delivered a strong message on Taiwan, which is claimed by China as part of its territory.
“Any actions and tricks to split China are doomed to failure and will meet with the people’s condemnation and the punishment of history,” he said to loud applause from almost 3,000 parliamentary delegates.
China has been infuriated by Trump’s signing of legislation that encourages the US to send senior officials to Taiwan to meet Taiwanese counterparts and vice versa.
Xi made repeated references to a resurgent nation of 1.3 billion people that would “ride the mighty east wind of the new era” and was on the cusp of matching the country’s greatest achievements in its long history.
At the same time he said that increasing global concerns over China’s rise were unjustified. “Only those who are in the habit of threatening others will see everyone else as a threat.
“We will not impose our will on anyone,” he said.
When Xi’s top economic adviser Liu He visited Washington recently, the Trump administration pressed him to find ways to reduce China’s $375 billion trade surplus with the United States. “We are unwilling to see a big trade deficit, not only with the US,” Li said. “We hope trade will be balanced.”
In his remarks, Li said that as China widens access to its markets, there will be no forced transfers of technology, and China will better protect intellectual property rights.
Trump accuses Beijing of forcing US companies to transfer their intellectual property to China as a cost of doing business there, although China has insisted that technology transfers are not a condition of gaining market access.
A source who had direct knowledge of the Trump administration’s thinking said last week that the tariffs would chiefly target information technology, consumer electronics and telecoms, and other products benefiting from US intellectual property.
But they could be much broader and hit consumer products such as clothing and footwear, with a list eventually running to 100 products, the source said.
“We hope the US could ease restrictions on high-tech or high value-added product exports,”
Li said.
“We will strictly protect intellectual property. We hope this important means for balancing China-US trade will not be missed, otherwise we will lose a chance to make money.”
Before the press conference, Li introduced China’s four new vice premiers, including Liu He, widely regarded as the country’s new economic tsar. But, adhering to protocol, it was the premier who did all the talking.
Li said China was confident of achieving its 2018 economic targets. The government aims to expand its economy by around
6.5 percent this year, having surpassed the same target in 2017.
China’s financial sector was in good shape and banks have enough provisions, Li said, adding that regulators would take “resolute measures” to tackle financial risks.
The Chinese central bank was being given responsibility for drafting laws covering the banking and insurance sector, with regulation over the $42 trillion sector becoming more streamlined.
Li said he was willing to consider a formal visit to Japan, amid signs of improving ties between the two nations.
Tokyo has repeatedly pressed Beijing to do more to help rein in North Korea’s missile and nuclear programs. China said it is committed to enforcing UN sanctions, but that all parties need to do more to reduce tensions and restart talks.
China’s premier hopes trade war can be averted, pledges more open economy
China’s premier hopes trade war can be averted, pledges more open economy
Oil Updates — prices poised for weekly fall on Trump’s energy policies
LONDON: Oil prices were little changed on Friday but headed for a weekly decline after US President Donald Trump issued a sweeping plan to boost US production and demanded OPEC lower crude prices.
Brent crude futures were down 9 cents at $78.20 a barrel by 7:45 a.m. Saudi time on Friday, while US West Texas Intermediate crude dipped 9 cents to $74.53.
For the week, Brent was down 3.18 percent so far, while WTI shed 4.28 percent.
“Crude prices have been easing all through this week, as investors trimmed war premiums after the Gaza ceasefire while bracing for Trump’s energy policy change,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.
“For now, Trump is being unpredictable as predicted, setting oil prices up for headlines-oriented volatility ahead,” Sachdeva added.
Trump, during his speech on Thursday at the World Economic Forum in Davos, Switzerland, said he would demand that the Organization of the Petroleum Exporting Countries bring down the cost of crude barrels.
He also said he would ask Saudi Arabia to increase a US investment package to $1 trillion, up from $600 billion reported by the Kingdom’s state news agency earlier in the day.
Trump had declared a national energy emergency on Monday, rolling back environmental restrictions on energy infrastructure as part of a sweeping plan to maximize domestic oil and gas production.
On Wednesday, he vowed to hit the EU with tariffs and impose 25 percent tariffs against Canada and Mexico, and said his administration was considering a 10 percent punitive duty on China.
As attention shifts to a possible February timeline for new tariffs set by Trump, caution will likely persist in the market as any new trade restrictions will carry negative implications for global growth, potentially weighing on oil demand prospects, said Yeap Jun Rong, market strategist at IG.
Traders expect oil prices to range between $76.50 and $78 a barrel, Yeap added.
While bullish catalysts like a significant drawdown in US crude stocks are providing temporary positive swings, an overall oversupplied global market and ailing projections of Chinese demand continue to weigh on crude futures, Phillip Nova’s Sachdeva said.
US crude inventories last week hit their lowest level since March 2022, according to the US Energy Information Administration.
The EIA report, issued a day late because of a US holiday on Monday, said crude stockpiles fell by 1 million barrels to 411.7 million barrels in the week to Jan. 17, marking a ninth consecutive weekly decline.
Saudi Arabia, UAE poised to become trade ‘super-connector hubs,’ WEF panel hears
- Agility’s Henadi Al-Saleh highlights that innovation, investment help countries to capitalize on disruption in global trade
LONDON: Saudi Arabia is on track to emerge as a “super-connector hub,” leveraging ongoing global trade disruption to its advantage, according to experts speaking at the World Economic Forum in Davos on Thursday.
Henadi Al-Saleh, chair of the board of directors at Agility, a global leader in supply chain services, highlighted the Gulf Cooperation Council’s significant investments in infrastructure as a driving force behind this transformation.
She said: “(In) the past few years, the level of activity, especially around cargo, has increased several fold.
“If I look at the GCC, where we have invested in warehouses, and at the Emirates in Saudi Arabia, one of our key platforms, (they are) set to become super-connector hubs.
“These countries are investing in infrastructure, doubling down, and the level of activity is increasing.”
Al-Saleh identified digitalization as a key value in this development, saying that “in a time with so much uncertainty, having that clarity and understanding, even when changes take place, it gives me visibility. (With the digital tools) I know what the rules (are) and (how) I need to adjust.”
She added: “That’s one critical aspect in which you see these super hubs benefiting.”
While the level of trade has continued to grow since the end of the pandemic, socioeconomic and political factors have continued to disrupt industry.
Experts have said that US President Donald Trump’s second term is expected to exacerbate the disruption, with the president supporting potential trade tariffs on multiple exporting nations.
Chile’s Minister of Foreign Affairs Alberto van Klaveren acknowledged the challenges but also pointed to opportunities arising from these shifts.
He said: “There are possibilities. Some economies are opening up. We signed the CEPA Agreement (Comprehensive Economic Partnership Agreement) with the Emirates. We are interested in Saudi Arabia.”
He explained that the importance of diversification was not only in export markets but also in the types of goods and services traded.
However, experts cautioned that ongoing trade disruption could significantly impact the global energy transition, particularly in the green energy sector.
Al-Saleh said: “There are certain segments of people, businesses and technologies (in the green energy market) that are paying a price.
“But this is where, I think, from the private sector, it’s incumbent upon them to continue. This is irrespective of what happens today in terms of tariffs. There is a long view, and we need to all manage towards that long view.”
According to World Trade Organization data, every nation relies on imports and exports for at least 25 percent of its goods. Given this interdependence, Al-Saleh argued, trade will remain indispensable despite ongoing disruption.
She said: “You need to focus on being agile and resilient. Those are critical elements, and the way to become agile and resilient is really to diversify and invest in technology.”
Saudi Arabia taking bold steps to test smart technologies as it embraces AI, says industry minister
- Kingdom has embarked on a transformation of traditionally industrial cities into modern smart cities, Bandar Alkhorayef tells World Economic Forum
- Nation’s businesses are increasingly adopting new technologies to help enhance productivity, he adds
DAVOS: Saudi Arabia is becoming a regional hub for testing the use of new technologies as efforts to diversify the national economy continue, the minister of industry and mineral resources, Bandar Alkhorayef, told the World Economic Forum in Davos on Thursday.
The Kingdom has established national organizations such as the Saudi Data and AI Authority and the Future Factories Program to regulate and help businesses adopt new technologies that utilize artificial intelligence, machine learning, 3D printing and robotics, he added.
This smart infrastructure market is projected to be worth $2 trillion within the next 10 years, up from an estimated $900 billion in 2024, driven by growth in the integration of physical and digital industrial operations.
Alkhorayef said Saudi Arabia places a priority on manufacturing and has embraced the use of the latest technologies in sectors such as renewable energy and electric vehicles, as the Kingdom embarks on ambitious plans to transform traditionally industrial cities into modern smart cities.
“The investors coming to these cities (will find) a ‘plug-and-play’ kind of support,” he said, as authorities take steps to attract businesses and global talent to work and invest, and to establish the country as a regional hub for technological research, development and innovation.
The Kingdom’s Future Factories Program, for example, aims to provide training initiatives and loans to help 4,000 factories adopt new technologies, embrace automation and improve manufacturing efficiency.
“We’re very bold when it comes to testing new ideas and technologies,” Alkhorayef added, which makes it “interesting for new players to see (Saudi Arabia) as a place where they can not only seek financing or investment but also a place to test and pilot certain ideas.”
Such endeavors are endorsed by some of the country’s biggest corporations, including the chemical manufacturing company SABIC, the petroleum company Aramco, and the mining giant Maaden. Aramco, for example, has already adopted new technologies, including AI, to enhance productivity and reduce carbon dioxide emissions.
Alkhorayef was speaking during a WEF discussion titled “Next-Gen Industrial Infrastructure.” The other panelists included representatives of the African Union Commission, businesses and consulting firms.
Currently, up to 50 percent of Saudi Arabia’s deep-tech startups are focused on the development of AI or the Internet of Things, Alkhorayef said, as the country increasingly adopts digitalization in the public and private sectors.
The Saudi Data and AI Authority, established in 2019 to regulate and promote the national agenda for a data-driven economy, has said that AI is making significant contributions to operational efficiency. In 2023, global spending on AI exceeded $120 billion, with more than 72 percent of organizations incorporating the technology into at least one business area.
“We believe that adopting technology in the mining sector will lead to safer, more productive and energy-efficient mines,” Alkhorayef said by way of an example, adding that it is essential that authorities consider environmental protection as they seek to strike the right balance between the interests of investors and the local community.
“Making digitalization accessible is an important part of what we do (in the Kingdom),” he said. “It involves regulation, cybersecurity, human capital training, and investing in incubators to work and learn.
“In every sector, such as food, energy or mining, (we always ask) the question of how technology could be helpful.”
Saudi economic success driven by ‘key North Star, not egos,’ says finance minister at WEF
- Mohammed Al-Jadaan highlights Kingdom’s shift from short-term budgets to longer-term fiscal planning, ensuring clear priorities and disciplined spending
- Transformation driven by clear decisions and significant investments led to strong economic performance, adds economic planning chief Faisal Al-Ibrahim
DAVOS: Saudi Finance Minister Mohammed Al-Jadaan on Thursday said that the Kingdom’s economic planners were being driven by their “North Star” and not egos as they look to maintain growth in the economy.
Speaking on a panel about the Saudi economy at the annual meeting of the World Economic Forum, Al-Jadaan highlighted Saudi Arabia’s shift from short-term budgets to longer-term fiscal planning, ensuring clear priorities and disciplined spending.
He said that there was flexibility and a readiness within the government to adapt plans based on global circumstances. “I’ve said this repeatedly, we don’t have egos. We are willing to change depending on circumstances and we will continue to do that. We will prioritize what matters,” he said.
“Our key North Star is what is driving us, and the tools can change, the means can change. It’s really that North Star that we are looking forward to,” he said.
He emphasized the progress and resilience of Saudi Arabia’s economy under Vision 2030, noting that the plan had mobilized the entire nation — government, businesses, right down to citizens — toward clear, long-term goals.
He attributed this success to visionary leadership, tough decision-making and consistent execution, adding that this approach could be a universal “recipe” for unlocking global potential.
On the Saudi-US relationship, Al-Jadaan highlighted its strategic importance over the past eight decades, emphasizing that Saudi Arabia had maintained strong economic, diplomatic and security ties with Washington, regardless of the administration in power, whether Republican or Democrat.
He described the partnership as a “win-win situation” that remained vital and was likely to endure into the foreseeable future.
Al-Jadaan was joined on the panel by Saudi Minister of Economy and Planning Faisal Al-Ibrahim, who attributed the Kingdom’s strong economic performance to a first wave of transformation driven by clear, courageous decisions and significant investments, not only financially but also in terms of effort and planning.
Looking ahead, Al-Ibrahim stressed that the next phase of Vision 2030 would focus on addressing more complex challenges, particularly in enabling the private sector.
He emphasized the goal of increasing the private sector’s contribution to 65 percent of GDP by fostering collaboration, co-developing opportunities and creating an environment where private enterprises could take the lead in driving economic growth.
Key priorities include enhancing institutional capabilities, ensuring policy clarity and predictability, and addressing barriers to innovation-driven entrepreneurship, he said.
Al-Ibrahim also underlined the government’s commitment to working closely with the private sector, noting that ministers and their teams often worked long hours to respond to and engage with private enterprises. This collaborative approach, he said, was deeply embedded in the country’s Vision 2030 blueprint for economic transformation.
IMF Chief Kristalina Georgieva, who was also on the panel, praised Saudi Arabia’s transformation efforts, highlighting the country’s ability to create an appealing environment for business and tourism.
She commended its forward-thinking approach in engaging the private sector to diversify experiences and attract repeat visitors. Referring to her visit to AlUla, she said: “I didn’t know what to expect, but I came out thinking it was great we decided to open our regional office in Riyadh.”
Georgieva also noted Saudi Arabia’s strategic planning to host global events and foster economic growth. She described the country as a “good example of transformation” that others could look to for inspiration in creating dynamic, sustainable growth through proactive planning and investment.
Lebanon’s inflation rate drops to 45% in 2024, marking a return to double-digit figures
- Monthly inflation also increased by 2.38% in December, marking the third consecutive monthly rise
- Key contributors included miscellaneous goods and services, which rose 39.69% annually
RIYADH: Lebanon’s economic landscape showed signs of stabilization in 2024, with inflation rates returning to double-digit levels after three years of hyperinflation that had exceeded 200 percent.
The annual inflation rate stood at 45.24 percent last year, a substantial drop from the staggering 221.3 percent recorded in 2023, according to data from the Central Administration of Statistics.
Lebanon has endured prolonged economic instability, with the Lebanese lira losing 90 percent of its value since the crisis began in 2019. The drop in inflation aligns with the International Monetary Fund’s October forecast, which projected inflation in the Middle East and North Africa region to ease to 3.3 percent in 2024.
Last year represented a period of relative calm in terms of price volatility. Monthly inflation indices revealed a deceleration in price growth. The index for December reached 30,936.02, compared to 30,147.41 in November, showing a modest increase compared to the unpredictable fluctuations of prior years.
The slowdown in inflation is largely due to the stabilization of the Lebanese lira, driven by Banque du Liban’s monetary policies since 2023. By the spring of last year, the exchange rate had settled at around 89,500 Lebanese liras per dollar, following a sharp rise from 40,000 to 140,000 earlier in 2023.
This stability helped bring annual inflation below 100 percent in April, reaching 18.1 percent by December, though the same month’s inflation rose slightly from November’s 15.38 percent.
Monthly inflation also increased by 2.38 percent in December, marking the third consecutive monthly rise, following 2.02 percent in October and 2.30 percent in November.
Key contributors to inflation in December included miscellaneous goods and services, which rose 39.69 percent annually, education fees at 31.27 percent, and health care at 22.93 percent. Only communications and furniture saw price declines at 2.99 percent and 1.99 percent, respectively.
Lebanon’s state-owned telecom firm, Ogero, said it is working to restore and expand its connectivity. The firm’s Chairman and Director General Imad Kreidieh announced in a live broadcast on Jan. 21 that the company’s expansion plans will resume, supported by funding from multiple donors.
North Lebanon recorded the highest monthly increase in December at 3.79 percent, followed by Beirut and Nabatieh at 3.59 percent, and South Lebanon at 2.97 percent.
The drop in inflation offers some relief to the Lebanese people, but with the election of former army commander Joseph Aoun as president on Jan. 9 and the appointment of the Chief Judge of the International Court of Justice, Nawaf Salam, as prime minister on Jan. 13, the need for comprehensive reform remains urgent.
The political breakthrough has also sparked a rally in Lebanon’s government bonds, which have nearly tripled in value since September. The election of Aoun, following 12 failed attempts to choose a president, has raised hopes that Lebanon might finally address its economic challenges.
Most of the country’s international bonds, in default since 2020, rallied further after Aoun’s election, rising by nearly 0.9 cents on the dollar to around 16 cents — a modest recovery that underscores investor optimism despite Lebanon’s ongoing struggles.
