LA MALBAIE, Canada: The Group of Seven leaders on Saturday failed to heal a tariff dispute that has pushed them to the brink of trade war, as Donald Trump quit their summit early warning Canada, Japan and Europe that “the gig is up.”
Trump had come to Quebec insisting on his long-standing claim that America has been exploited for too long by existing trade arrangements — and he was met by counterparts equally determined to protect the “rules-based” international system.
The US president left on Saturday for Singapore and a historic summit with North Korea’s Kim Jong Un, claiming he had made progress convincing the other G7 leaders that trade between their countries must be better balanced or halt altogether.
“The United States has been taken advantage of for decades and decades,” Trump said at a press conference on the second day of the two-day summit.
“I guess they’re going to go back to the drawing board and check it out, right?” he said, warning that if his fellow six leaders make good on their threats to take retaliatory measures, they could find themselves shut out of American markets.
European officials said Trump had opposed language in the draft final summit communique on the need to bolster the World Trade Organization and multilateral oversight of commerce, but that this commitment would survive.
“For us, it was important to have a commitment to rules-based trade,” Germany’s Chancellor Angela Merkel said.
“On the issue of trade, we have been able to agree on important questions to us,” she added, stressing that it was “important to have a commitment to rules-based trade.”
Merkel acknowledged, however, that major differences remained between the US and its partners in the group which includes the world’s seven most industrialized economies.
“This is not a detailed solution to our problems. The differences in opinion have not been taken off the table.”
The German leader said there was “a common conviction” about the need for changes to the WTO, although it was not immediately clear if there would a clear call for reform in the final statement.
As the leaders met, Trump played a wild card, suggesting that rather than both sides boosting retaliatory tariffs — as he has just done on steel and aluminum — they could declare for entirely free trade in the G7 zone.
“No tariffs, no barriers. That’s the way it should be. And no subsidies. I even said, ‘no tariffs’!” Trump insisted. “That would be the ultimate thing, whether or not that works, but I did suggest it.”
Trump’s utopian idea was greeted with skepticism — “Good luck. That would be a leap into a very different world,” declared one senior European official — with leaders pointing to the many regulations and non-tariff barriers that limit free trade.
French President Emmanuel Macron, for example, noted that under European Union rules France currently has open borders with Britain and Germany and runs trade deficits with both — far from Trump’s vision of “reciprocal” balanced trade.
European officials suggested that the upbeat, punchy news conference that Trump delivered before skipping out on the summit was aimed at his trade-skeptic supporters back home, and did not reflect the results of the summit.
“We’re talking to all countries,” he said, denouncing what he said were huge existing tariffs on US exports around the world. “It’s going to stop. Or we’ll stop trading with them. And that’s a very profitable answer, if we have to do it.
“If they retaliate, they’re making a mistake,” he warned, insisting that the United States has much less to lose than its partners in the event of world trade breaking down. “We will win that war 1,000 times.”
The text of the annual G7 joint communique is usually all but finalized before the leaders meet for two days of glad-handing and group photo opportunities, but this year officials were still negotiating even as Trump headed for his plane.
Whatever the text eventually says, Canada’s summit will be remembered mainly for fierce disagreements over Trump’s tariffs and his surprise request to return Russia to the G7 fold, four years after its expulsion over the annexation of Crimea.
While diplomats wrangled in private, summit host Prime Minister Justin Trudeau gathered the other leaders for a breakfast session on women’s equality. Trump arrived 17 minutes after the planned 8:00am start time and after Trudeau’s opening remarks.
With his wife Melania back home in Washington, Trump cut a lonely figure on arrival at the golf resort in rural Quebec as he posed with his host Trudeau and his wife Sophie and other first couples.
A member of Macron’s team characterized the talks as “frank and robust,” with Trump first repeating his lengthy diatribe about what he regards as unfair trade restrictions — before the Europeans responded with facts and figures they felt would blunt his argument.
Trudeau told Trump that it was “unacceptable” to cite national security when targeting a military ally like Canada.
The summit was wrapping up just as Chinese President Xi Jinping begins hosting the leaders of Russia and Iran at a two-day regional security meeting in a symbol of the power-play between East and West.
G7 summit fails to heal trade rift as Trump exits early
G7 summit fails to heal trade rift as Trump exits early
- Trump delivers a stern warning on trade to foreign countries at the G7 summit, advising trading partners not to retaliate against US tariffs
- Trump injected additional controversy by suggesting the G7 offer a seat at the table to Russia, which was ousted in 2014
Pakistan PM says policy rate reduction to enhance business activities, boost employment
- Pakistan’s central bank slashed key policy rate by 250 basis points to 15 percent on Monday
- With fourth straight reduction since June, Islamabad aims to revive sluggish economy
ISLAMABAD: Pakistan’s Prime Minister Shehbaz Sharif has welcomed the central bank’s decision to cut the policy rate by 250 basis points, saying the move would help boost the country’s business activities and enhance employment opportunities, state-run media reported on Tuesday.
Pakistan’s central bank slashed its key policy rate by 250 basis points to 15 percent on Monday for a fourth straight reduction since June. The development takes place as Islamabad attempts to revive a sluggish, fragile $350 billion economy as inflation eases.
Monday’s move follows cuts of 150 bps in June, 100 bps in July, and 200 in September that have taken the rate from an all-time high of 22 percent, set in June 2023 and left unchanged for a year. It takes the total cuts to 700 bps in under five months.
“Prime Minister Shehbaz Sharif says the reduction in policy rate will enhance business activities, exports and employment opportunities in the country,” state broadcaster Radio Pakistan reported.
Sharif was chairing a meeting of the ruling Pakistan Muslim League-Nawaz’s (PML-N) parliamentary party on Monday when he touched upon the central bank’s move. The premier noted that inflation has reduced from an alarming 38 percent in May 2023 to 7 percent at present.
The Pakistani premier informed members of the PML-N parliamentary party about his visit to Saudi Arabia and Qatar last week, saying that “a new chapter” has been added to the Pakistan-Saudi investment partnership.
“The Saudi leadership assured all kinds of support for the stability and development of Pakistan’s economy,” Sharif said according to the state broadcaster.
The Pakistani prime minister also informed the lawmakers about his visit to Qatar, saying that the Qatari leadership also assured an increase in investment for Pakistan. He said talks were held between both sides on giving “a practical shape” to projects worth $3 billion in Pakistan.
“He said Qatar will invest in various sectors including aviation, hoteling, information technology and energy sectors in Pakistan,” the state broadcaster said. “Shehbaz Sharif said the government is taking steps on a priority basis to facilitate investment and increase foreign investment in Pakistan.”
AI will eliminate routine jobs but create new ones, expert says
- Chuck Yoo, executive vice president of research at Korea University, spoke to Saudi Data and Artificial Intelligence Authority’s GAIN podcast
RIYADH: Routine jobs are “very much in danger” thanks to the rise of artificial intelligence, a leading academic from Korea University has warned.
Speaking to the Saudi Data and Artificial Intelligence Authority’s GAIN podcast, Chuck Yoo – executive vice president of research at the Seoul-based institution – did offer an optimistic note, stating that new jobs will be created by the technology.
“For young people, I strongly encourage that they take an active role to learn the new technology and be used to how to use it. I think that’s the way that you can deal with such a profound change in our human history,” he told the GAIN Podcast.
Yoo further explained that the rise of AI is similar to the 18th century industrial revolution, where change opened up new opportunities.
Jobs that are based on routine work or gathering and analyzing data are the most in danger, said Yoo, giving the example of a paralegal.
AI in classes
As a professor, Yoo advises teachers and students to utilize the technology in classes instead of banning it, because the revolution is irreversible.
“You now have a very strong assistant, why do you want to go back to the old days?” Yoo remarked.
“To do that, professors who teach classes also have to know what GPT is and how to use it, and they should give assignments that have to be addressed with ChatGPT, not banning ChatGPT,” he added.
He added that the Korea University is also researching to build a new curriculum and a new way of teaching which incorporates AI and technologies like ChatGPT.
Yoo believes that AI is very rewarding and that the world is living in a fruitful age thanks to the technology.
Yoo emphasized the importance of findable sustainable solutions as the rise of the technology calls for more data centers, which extract a heavy power toll.
AI and energy
Yoo further added that Saudi Arabia’s push toward becoming an AI hub might call for more power plants amid higher energy consumption.
“It is being realized as a serious problem,” he said, adding: “People are working on how to reduce the power consumption in parallel with constructing more power plants.”
He added that the US has already announced their plan to build several nuclear facilities in anticipation of “exponential growth” of power consumption.
The Saudi Data and Artificial Intelligence Authority introduced the GAIN Podcast as it aims to elevate global understanding of data and AI and their effects on society.
The 14-episode series features insights from leading scientists, AI experts, decision-makers, and CEOs of prominent tech companies, discussing various aspects of technological advancements, industry milestones, and strategies for fostering human talent in the field.
Pakistanis welcome Aramco’s new Islamabad outlet
- Saudi oil giant opened its second outlet in Islamabad last week following the inauguration of the first in Lahore on Oct. 29
- In collaboration with Pakistan’s GO, Aramco aims to expand its retail network and establish a foothold in the Asian country’s growing economy
ISLAMABAD: Pakistanis in Islamabad on Monday hailed the opening of Aramco’s branded retail petrol station as a valuable addition to the capital’s oil marketing landscape, expressing hopes for high-quality fuel and services from the Saudi oil giant.
This is Aramco’s second retail outlet in Pakistan, following the opening of its first station in Lahore on Oct. 29 after the global oil giant acquired a 40 percent stake in Gas & Oil Pakistan Ltd, commonly known as GO Petroleum.
According to a statement shared last week by Corporate and Marketing Communications, which manages public relations for GO and the Saudi energy firm in Pakistan, Aramco-branded stations will offer premium fuel, high-quality lubricants, professional automotive services, and modern convenience stores, aiming to deliver a seamless customer experience.
The Saudi oil giant’s Islamabad outlet is located on Ataturk Avenue in the Pakistani capital, which is being frequented by a large number of customers anticipating quality fuel supply and services.
“This is a great addition to Islamabad. I hope that this global oil giant will focus on providing quality oil products, along with ensuring top-notch service and accurate fuel measurements,” Muhammad Asim, a Pakistani government employee, told Arab News, while filling up at the newly opened station, adding: “Looking forward to seeing the positive impact it brings to the city.”
Aramco is a global integrated energy and chemicals company that produces approximately one in every eight barrels of the world’s oil supply. GO, one of Pakistan’s largest retail and storage companies, is involved in the procurement, storage, sale and marketing of petroleum products and lubricants.
Together with GO, which has a network of over 1,200 fuel retail stations in Pakistan, Aramco plans to expand its retail network and establish a presence in the fast-growing Pakistani economy.
“Having Aramco in Pakistan is exciting,” said Sara Ahmed, a local business owner. “It raises the bar for fuel quality and customer service.”
She hoped that the Saudi company would set new standards in fuel quality and customer care, something that had been needed in Pakistan for quite some time.
Another customer, Ali Asghar, said Aramco is a renowned name globally and hoped the company would uphold its international standards in Pakistan.
“We need reputable global companies like this, not only to provide quality products but also to encourage competition among other companies, ultimately benefiting customers,” he told Arab News.
Pakistan and Saudi Arabia enjoy strong trade, defense, and cultural ties. The Kingdom is home to over 2.7 million Pakistani expatriates and serves as the top source of remittances to the cash-strapped South Asian nation.
In February 2019, Pakistan and Saudi Arabia inked investment deals totaling $21 billion during a visit by Saudi Crown Prince Mohammed bin Salman to Islamabad. The agreements included approximately $10 billion for an Aramco oil refinery and $1 billion for a petrochemical complex at the strategic Gwadar Port in Pakistan’s Balochistan province.
Islamabad and Riyadh have also been working in recent months to increase bilateral trade and investment, and the Kingdom this year reaffirmed its commitment to expedite an investment package worth $5 billion for Pakistan.
Both countries last month signed $2.2 billion in agreements and memorandums of understanding during the visit of a high-level business delegation, led by Saudi Minister for Investment Khalid Al-Falih.
UK’s non-dom tax reforms set to reshape Arab investment landscape
RIYADH: Arab investors will face significant changes to their UK tax affairs after the British government announced reforms to rules for non-UK domiciled individuals.
Effective from April 6, 2025, these changes will alter the tax efficiency strategies that many Arab investors have relied upon for UK property and investments.
So-called “non-dom” status is a tax classification that allows UK residents whose permanent domicile is in a different country to limit their tax liability on foreign earnings.
They have traditionally only been required to pay UK taxes on income generated within Britain, creating considerable tax savings for those who designate a lower-tax country as their domicile.
Starting in 2025, non-dom status will be abolished and replaced with a residency-based tax regime.
In an interview with Arab News, Vijay Valecha, chief investment officer at Century Financial said: “The disadvantages of the tax measures announced is that if an Arab buyer is planning to buy additional properties in the UK, they have to pay an increased surcharge of 5 percent.”
Moreover, if a buyer intends to dispose of a non-residential property, they have to pay increased capital gains tax 18 percent — 24 percent, he explained.
Arabs living in the UK who earn income abroad will also suffer from the abolishment of the non-UK domiciled tax status as their tax burden will increase, according to Valecha.
The CIO did reveal some positive news for investors, saying: “Non-resident Arab buyers can still purchase residential property in the UK at a 2 percent surcharge, a potential benefit.”
He added: “Newly arrived investors will enjoy a four-year grace period where foreign income and gains remain untaxed, offering short-term planning flexibility.”
Key changes
Under the current system, non-dom status can be obtained if an individual was born outside the UK or if their father’s permanent residence was in another country; or by becoming a domicile of choice, which is a classification available to individuals over 16 who decide to live indefinitely in another country.
From April 2025, newly arrived UK residents who have not been living in the country in the prior 10 years will receive a 100 percent tax relief on foreign income and gains for their first four years.
For capital gains tax, lower-rate taxpayers earning under £50,270 ($54,760) will now be taxed at 18 percent, up from 10 percent, while higher-rate taxpayers will see their rates increase to 24 percent from 20 percent.
Additionally, non-UK assets will be subject to UK inheritance tax if the individual has been a resident for at least 10 of the last 20 years.
Effective Oct. 31, 2024, the stamp duty surcharge on second homes increased from 3 percent to 5 percent.
Long-term strategies
Valecha anticipated that these changes may negatively impact the long-term investment strategies of Arab buyers, “due to higher surcharges on additional homes, capital gains taxes on disposal of secondary homes, and abolishment of the non-dom status.”
“In order to optimize their portfolio, Arab buyers can consider diversifying their portfolio to other asset classes and geographical regions that offer favorable tax regimes,” he said.
The UAE, for instance, could see increased interest due to its tax-free environment, and “Arab buyers looking to diversify can now consider investing their wealth in their own country.” This, he added, could improve capital flows in the UAE and boost the country’s real estate sector.
The UK government projects that these reforms could generate up to £12.7 billion in additional revenue over five years, underscoring the significant contribution expected from foreign investors.
With strategic planning, Valecha suggested that Arab investors can still leverage competitive opportunities in the UK market, even within this redefined landscape.
Closing Bell: Saudi main market sheds points, Nomu gains 2.8%
RIYADH: Saudi Arabia’s Tadawul All Share Index ended Monday’s trading session in the red, losing 8.95 points, or 0.07 percent, to close at 12,039.31.
The total trading value of the benchmark index was SR6.1 billion ($1.6 billion), with 66 listed stocks advancing, while 166 retreated.
The MSCI Tadawul Index also shed 0.34 points, or 0.02 percent, closing at 1,512.48.
However, the Kingdom’s parallel market Nomu gained 765.32 points, or 2.80 percent, to close at 28,062.77, with 41 stocks advancing and 32 retreating.
The best-performing stock of the day was Shatirah House Restaurant Co., also known as Burgerizzr, whose share price surged by 9.96 percent to SR22.52.
Other top performers included Retal Urban Development Co., which saw a rise of 9.64 percent to SR15,70, and Al-Baha Investment and Development Co., which increased by 7.14 percent to SR0.30.
Elm Co. and Al-Baha Investment and Development Co. also recorded gains of 4.64 percent and 4.29 percent, closing at SR1,122 and SR21.90, respectively.
Several Saudi firms released their financial results for the first nine months of the year.
Saudi Telecom Co. recorded a 3.9 percent yearly increase in profit to reach SR56.6 billion, mainly attributed to the rise in stc KSA and stc’s subsidiaries revenue by 0.6 percent and 11 percent, respectively.
Net profit also recorded growth of 1.9 percent to reach SR11.2 billion, largely driven by the increase in revenue and the decrease in zakat and income tax expenses.
The company closed Monday’s trading session in green with a 0.59 percent increase in its share price to reach SR42.30.
National Gas and Industrialization Co. also saw a significant 15.5 percent year-on-year increase in revenue to reach SR2 billion in the first nine months.
The growth in profit was driven primarily by rising gas prices and an uptick in sales volume. This shift is further supported by enhanced revenues from commercial projects and increased sales of empty cylinders.
Additionally, the company has witnessed gains from the sale of scrap and spare parts, as well as from transportation and various other services.
The firm also reported an increase in net profit by 2.1 percent to reach SR188.7 million, primarily driven by a significant rise in gross profit resulting from enhanced revenues and a reduction in zakat expenses.
Despite this, the company closed Monday’s trading session in red, shedding 2.21 percent to close at SR106.
Bupa Arabia for Cooperative Insurance Co. also recorded significant gains. The company saw insurance revenues increase by 15 percent to reach SR13.4 billion, driven by business growth.
Profit before zakat and income tax attributable to shareholders for the current period amounted to SR1.3 billion, an increase of 31.4 percent, mainly due to gains across multiple aspects of the business.
Despite the strong gains, Bupa closed Monday’s trading session in red, shedding 1.49 percent to close at SR198.20.
On a different note, SNB Capital launched its SNB Capital Saudi Nomu Market Fund to facilitate easier access to the parallel market.
The fund is designed for retail investors aiming to strategically invest in the listed equities on the Nomu market without having to meet the Qualified Investor criteria.
