Chinese government to sell sovereign bonds worth $340bn by year-end

The issuance of a total of 3.45 trillion yuan in local government special bonds for infrastructure has been completed by the end of June. (Shutterstock)
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Updated 29 September 2022
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Chinese government to sell sovereign bonds worth $340bn by year-end

RIYADH: China will sell sovereign bonds totalling $340 billion in the final months of this year as the Asian giant taps the remaining annual quota and refinances maturing special bonds.

The government has issued 1.09 trillion yuan ($151 billion) of general bonds so far this year ⁠— less than 40 percent of the budgeted central deficit of 2.75 trillion yuan for 2022, Bloomberg reported based on its calculations.

According to the report, the government is expected to issue a total of 2.45 trillion yuan in sovereign bonds between October and December, which comprises 1.66 trillion yuan of new bonds and 786 billion yuan to refinance maturing special debts.

Meanwhile, Reuters, citing people familiar with the matter, said that the treasury bond issuance plan was made during a meeting of the finance ministry on Wednesday.

According to the Reuters report, the ministry also urged local governments to complete issuing the roughly 500 billion yuan in special bonds by the end of October under carryover quotas from previous years, the sources said.

The issuance of a total of 3.45 trillion yuan in local government special bonds for infrastructure has been completed by the end of June.

Amid weak consumption recovery and softening export growth, authorities are doubling down on an infrastructure push, dusting off an old playbook by issuing debt to fund big public works projects to revive the economy.

China’s economy generally recovered and stabilized in the third quarter and the country will push ahead with its economic program in the fourth, state media quoted Li Keqiang, premier of the State Council of the People’s Republic of China, as saying on Wednesday.

But with few signs China will significantly ease its zero-COVID policy soon, many analysts expect the economy to grow by just 3 percent this year, which would be the slowest since 1976, excluding the 2.2 percent expansion during the initial COVID hit in 2020.

(With input from Reuters)


Arab cities rank among top 10 friendliest in the world for expats

Updated 1 min 4 sec ago
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Arab cities rank among top 10 friendliest in the world for expats

  • Emirati city of Ras Al-Khaimah in 5th place, Oman’s capital Muscat ranks 10th
  • Saudi capital among ‘the biggest winners in 2024,’ jumping 10 places to rank 12th: Index

LONDON: The Emirati city of Ras Al-Khaimah and Oman’s capital Muscat have been ranked among the top 10 friendliest destinations in the world for expats.

The Ease of Settling In Index 2024 by InterNations, which describes itself as “the largest global expat network” with 5.6 million members, includes 53 cities and comprises three subcategories: culture and welcome, local friendliness and finding friends.

Ras Al-Khaimah ranked fifth overall while Muscat ranked 10th, closely followed by the Emirati city of Dubai (11th), the Saudi capital Riyadh (12th), the UAE capital Abu Dhabi (14th) and Qatar’s capital Doha (15th).

Ras Al-Khaimah and Muscat “perform well across the index but stand out especially for how easy expats find it to get used to the local culture … as well as for the general friendliness of the population,” according to the index.

InterNations described Riyadh as one of “the biggest winners in 2024,” jumping 10 places from the 2023 rankings and improving “across all factors of the index.”

Riyadh’s biggest gains were in the culture and welcome subcategory, rising from 30th in 2023 to 14th last year.


Trump to reduce impact of auto tariffs, commerce secretary says

Updated 10 min 43 sec ago
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Trump to reduce impact of auto tariffs, commerce secretary says

WASHINGTON: President Donald Trump’s administration will move to reduce the impact of his automotive tariffs on Tuesday by alleviating some duties imposed on foreign parts in domestically manufactured cars and keeping tariffs on cars made abroad from piling on top of other ones, officials said.

“President Trump is building an important partnership with both the domestic automakers and our great American workers,” Commerce Secretary Howard Lutnick said in a statement provided by the White House.

“This deal is a major victory for the President’s trade policy by rewarding companies who manufacture domestically, while providing runway to manufacturers who have expressed their commitment to invest in America and expand their domestic manufacturing.”

The Wall Street Journal, which first reported the development, said the move meant car companies paying tariffs would not be charged other levies, such as those on steel and aluminum, and that reimbursements would be given for such tariffs that were already paid.

A White House official confirmed the report and indicated the move would be made official on Tuesday.

Trump is traveling to Michigan on Tuesday to commemorate his first 100 days in office, a period that the Republican president has used to upend the global economic order.

The move to soften the effects of auto levies is the latest by his administration to show some flexibility on tariffs, which have sown turmoil in financial markets, created uncertainty for businesses and sparked fears of a sharp economic slowdown.

Automakers said earlier on Monday they were expecting Trump to issue relief from the auto tariffs ahead of his trip to Michigan, which is home to the Detroit Three automakers and more than 1,000 major auto suppliers.

General Motors, CEO Mary Barra and Ford CEO Jim Farley praised the planned changes. “We believe the president’s leadership is helping level the playing field for companies like GM and allowing us to invest even more in the US economy,” Barra said.

Farley said the changes “will help mitigate the impact of tariffs on automakers, suppliers and consumers.”

Last week, a coalition of US auto industry groups urged Trump not to impose 25 percent tariffs on imported auto parts, warning they would cut vehicle sales and raise prices.

Trump had said earlier he planned to impose tariffs of 25 percent on auto parts no later than May 3.

“Tariffs on auto parts will scramble the global automotive supply chain and set off a domino effect that will lead to higher auto prices for consumers, lower sales at dealerships and will make servicing and repairing vehicles both more expensive and less predictable,” the industry groups said in the letter.

The letter from the groups representing GM, Toyota Motor, Volkswagen, Hyundai and others, was sent to US Trade Representative Jamieson Greer, Treasury Secretary Scott Bessent and Commerce’s Lutnick.

“Most auto suppliers are not capitalized for an abrupt tariff induced disruption. Many are already in distress and will face production stoppages, layoffs and bankruptcy,” the letter added, noting “it only takes the failure of one supplier to lead to a shutdown of an automaker’s production line.” 


Spain’s power supply is almost fully restored after one of Europe’s most severe blackouts

Updated 10 min 16 sec ago
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Spain’s power supply is almost fully restored after one of Europe’s most severe blackouts

  • Many questions remained about what caused one of Europe’s most severe blackouts
  • By 7:00 a.m. local time, more than 99 percent of energy demand in Spain had been restored

MADRID: Power had almost fully returned to Spain early Tuesday morning as many questions remained about what caused one of Europe’s most severe blackouts that grounded flights, paralyzed metro systems, disrupted mobile communications and shut down ATMs across Spain and Portugal.

By 7:00 a.m. local time, more than 99 percent of energy demand in Spain had been restored, the country’s electricity operator Red Electrica said. Portuguese grid operator REN said Tuesday morning all of the 89 power substations were back online since late last night after an “absolutely unusual” blackout and power was restored to all 6.4 million customers.

On Tuesday morning, as life slowly returned to normal on the Iberian Peninsula, outside Atocha station, one of the busiest in the Spanish capital, people were once again crossing the street while looking at their cell phones, despite the Internet connection being intermittent at times.

Inside, hundreds of people waited to board trains or rebook those that had been canceled the previous day. Large groups of people milled around the screens, waiting for updates. Still, several people slept on the floor with blankets provided by the Red Cross for those who waited overnight at the station. The same scenes were replicated at Sants station in Barcelona. Classes were suspended in several regions.

The Madrid Open, the tennis tournament being held this week, was still affected by the power outage after its cancelation the previous day and delayed the opening of its doors.

Power had gradually returned to several regions across Spain and Portugal as the nations reeled from the still-unexplained widespread blackout that had turned airports and train stations into campgrounds for stranded travelers.

Monday night, many city residents, including in Spain’s capital of Madrid, went to sleep in total darkness. The normally illuminated cathedral spires of Barcelona’s Sagrada Familia Basilica became indistinguishable from the night sky. Streets remained deserted even in neighborhoods where lights flickered back on, as people stayed home after a day of chaos.

“We have a long night ahead,” Spanish Prime Minister Pedro Sanchez said when he addressed the European nation late Monday. “We are working with the goal of having power restored to the entire country.”

In Madrid, cheers erupted from balconies where the electricity had returned.

Subway service returning on Tuesday morning

On Tuesday morning, Madrid’s metro system was restored on all but one line, meaning that 80 percent of trains operated during rush hour.

In Barcelona, the metro was also operating normally, but commuter trains were suspended due to “electrical instability,” the company that runs the service, Rodalies Catalunya, said on X. In other parts of the country, commuter and mid-distance services were also suspended or running at reduced capacity.

As metro service stopped on Monday, train stations cleared out and shops and offices closed, and thousands of people spilled onto the streets of Madrid.

Emergency workers in Spain said they rescued some 35,000 passengers stranded along railways and underground.

The blackout turned sports centers, train stations and airports into makeshift refuges late Monday.

“We were in the north of Portugal and did get any notifications until we got here because of Internet outage,” said Ian Cannons, a British tourist trying to get home who was forced to spend the night in Lisbon’s airport. “We can’t book any hotels. Nothing.”

The Barcelona municipality distributed 1,200 cots to indoor recreation centers to host residents with no way to get home and international travelers left in limbo. All over Barcelona and Madrid, people were sleeping on train station benches and floors.

Cash and radios in high demand

As Internet and mobile phone services blinkered offline across Spain and Portugal, battery-powered radios flew off the shelves. Those fortunate enough to find service shared whatever news updates they could with strangers on the street.

Lines snaked out of the few supermarkets running on backup generators in Barcelona and Lisbon as people stocked up on dried goods, water and battery-powered flashlights and candles. Clerks counted euros by hand, since many cash registers had stopped working.

Hector Emperador, picking his kids up from school in Barcelona, said he resorted to raiding his sons’ piggybank to ensure he had cash on hand after ATMs and some online-banking services shut down. “The coronavirus pandemic will be nothing compared to this,” he said.

Few gas stations were operating, sending the drivers who dared navigate without traffic lights scrambling for fuel. Residents with electric door keys found themselves locked out of their homes.

The many inconveniences became a threat to survival for those with medical needs like refrigeration for insulin or power for dialysis machines and oxygen concentrators. Some hospitals – but not all – stayed open with the help of generators.

Cause remains a mystery

Officials did not say what caused the blackout, the second such serious European power outage in as many months after a fire at Heathrow Airport shut down Britain’s busiest travel hub on March 20.

They said there was little precedent for this kind of widespread electric failure across all of the Iberian Peninsula, with a combined population of some 60 million. Across the Mediterranean Sea, Spain’s Balearic Islands and the territories of Ceuta and Melilla were spared. The Canary Islands off the northwest coast of Africa were also spared.

“We have never had a complete collapse of the system,” Sanchez said, explaining how Spain’s power grid lost 15 gigawatts, the equivalent of 60 percent of its national demand, in just five seconds.

In his televised address late Monday, Sanchez said that authorities were still investigating what happened. Portugal’s National Cybersecurity Center threw cold water on feverish speculation about foul play, saying there was no sign that the outage resulted from a cyberattack.

Speaking to reporters in Brussels, Teresa Ribera, an executive vice president of the European Commission, also ruled out sabotage. Nonetheless, the outage “is one of the most serious episodes recorded in Europe in recent times,” she said.


Power outage still affecting Madrid Open tennis tournament. Opening of the gates delayed on Tuesday.

Updated 12 min 53 sec ago
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Power outage still affecting Madrid Open tennis tournament. Opening of the gates delayed on Tuesday.

  • They did not immediately announce any schedule change regarding the matches
  • The power went out at 12:34 p.m. local time (1034 GMT) on Monday and 22 matches had to be canceled for the day

MADRID: There was still no power at the Caja Magica tennis complex that is hosting the Madrid Open on Tuesday, putting in jeopardy the resumption of play a day after several matches had to be canceled.
Tournament organizers said the opening of the gates for fans was delayed until 11 a.m. local time (0900 GMT) because of the outage. They did not immediately announce any schedule change regarding the matches.
“Due to reasons beyond the organization’s control, the Caja Mágica is still without power supply as of this morning. As a result, the opening of the gates has been delayed, and we expect to open them at 11 a.m.,” they said.
The power went out at 12:34 p.m. local time (1034 GMT) on Monday, stopping two ATP singles matches and one doubles match that were underway. A total of 22 matches had to be canceled for the day.
Organizers said the games were called off “to guarantee the safety of the players, fans and personnel.” Spectators were told to leave the sports complex.
Power was restored at night through most parts of Madrid, and organizers had said late Monday that play would resume on Tuesday.
Among the matches expected for Tuesday included second-ranked Alexander Zverev facing Francisco Cerundolo. On the women’s side, the remaining six fourth-round matches were scheduled, including top-ranked Aryna Sabalenka facing Peyton Stearns and second-ranked Iga Swiatek taking on Diana Shnaider.
The blackout brought much of Spain and Portugal to a standstill, knocking out subway networks, phone lines, traffic lights and ATM machines.


IMF Executive Board to meet on May 9 to review Pakistan’s loan programs

Updated 20 min 40 sec ago
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IMF Executive Board to meet on May 9 to review Pakistan’s loan programs

  • IMF board’s approval of staff-level agreement with Pakistan will pave the way for disbursement of $1 billion
  • Islamabad also secured a new loan program with IMF in March to help build resistance against natural disasters 

KARACHI: The International Monetary Fund’s (IMF) Executive Board will meet on May 9 to review its staff-level agreement with Pakistan for an ongoing $7bn bailout program and a new climate resilience loan scheme with Islamabad, the global lender said on its website recently. 

The IMF reached a staff-level agreement with Pakistan in March on the first review of the country’s Extended Fund Facility (EFF) and a new $1.3 billion loan arrangement under the Resilience and Sustainability Facility (RSF). Pakistan secured the EFF program last year and deems it crucial to escape a prolonged economic crisis. The staff-level agreement, once approved by the IMF Executive Board, will pave the way for an immediate disbursement of about $1 billion for Pakistan.

The RSF, on the other hand, will support Pakistan’s efforts in building resilience to natural disasters, enhancing budget and investment planning to promote climate adaptation, improve the efficient and productive use of water. It will also help in strengthening Pakistan’s climate information architecture to improve the disclosure of climate risks and align energy sector reforms with mitigation targets.

“May 9, 2025, Pakistan-first review under the extended arrangement under the Extended Fund Facility, request for Modification of Performance Criteria, and request for an arrangement under the Resilience and Sustainability Facility,” the IMF wrote on its website on Friday, disclosing its Executive Board’s schedule. 

Pakistan has been prone to natural disasters and consistently ranks among the most severely affected countries in the world due to climate change effects. Unusually heavy rains and melting of glaciers in 2022 triggered flash floods across the country, killing over 1,700 people and inflicting losses over $33 billion. 

The IMF program has played a key role in stabilizing Pakistan’s battered economy, which has made some gains in recent months, most notably a reduced inflation rate. The government has said the country is on course for a long-term recovery, while Finance Minister Muhammad Aurangzeb has vowed Islamabad will continue to implement financial reforms mandated by the international lender. 

Pakistan secured the $7 billion loan program in September 2024 as it attempted to consolidate its economy since averting a default in 2023. Islamabad has since undertaken several reforms to reduce public debt, maintain low inflation, improve energy sector viability, and accelerate growth.

Pakistan hopes to achieve further economic progress by increasing its exports and attracting foreign investment from regional allies, particularly the Gulf countries. Islamabad has signed memoranda of association (MoUs) regarding trade and investment worth billions of dollars with Saudi Arabia, the United Arab Emirates, Azerbaijan, China and other countries in recent months.