Container players expect more chaotic peak season

According to a survey, forwarders, traders and shippers expect the 2022 container peak season to be even more chaotic than 2021. The Survey found that 51% expect the traditional peak season in the third quarter to be worse in 2022 than in 2021, 26% expect it to be less chaotic and 22% expected about the same level of chaos.

The pandemic disrupted the usual seasonal swings in the container market as factories were closed, lockdowns spread and congestion followed. Faced with another disrupted year, respondents were turning to multiple strategies to get goods to retailers in time for the fourth quarter shopping season.

Container line reliability dropped to 35.8% in 2021 and fell even further in the first quarter of 2022.

Some 37.5% of respondents said they were shipping early in 2022 to ensure volumes, 25% were using alternative shipment routes and 18.8% were contracting long-term slot agreements with carriers.

Despite the difficulties in 2021 and expectation of chaos to come, 62.5% of respondents were still relying on the spot market or had no specific plans to ensure shipments make it to destination in time.

Turning back to the current situation, 58% of respondents said China’s Covid lockdowns had made it “hard to produce/ship as much product as planned.” That feedback adds to growing concerns that the release of lockdowns in China could lead to a surge of exports, further disrupting supply chains to Europe and North America.

“Predicting exactly what will happen in this year’s peak season is harder than normal because there are so many contradictory signs and intangibles,” said Christian Roeloffs, co-Founder and CEO, of Container xChange.

“One big question is whether China is going to sacrifice its zero Covid-19 policy to get trade and its economy moving again. 

“If it does, then there’s every sign that we’ll see a substantial surge as backlogs of exports is shipped. If lockdown rules are relaxed soon and truckers are allowed to get back to work, then those backlogs will be arriving at the same time as peak season orders which could cause a lot of supply chain blockages at ports in Europe and the US where congestion is already widespread.

“However, there are very few indicators so far that President Xi is willing to compromise health policy to boost trade. Indeed, it might not be politically expedient for him to do so with the Communist Party National Congress set for later this year when he is expected to be endorsed for a third term. “

 

European Union needs €210 billion to free itself from Russian energy

According to the European Commission, the Union will have to invest an additional €210 billion (US$220 billion) to free itself from Russian energy imports by 2027. 

The extra investment comprises of €29 billion to adapt the power grid, €10 billion to ensure sufficient LNG and alternative pipeline gas imports, €2 billion for security of alternative oil supplies, €56 billion on energy efficiency and heat pumps, and an extra €113 billion on developing renewable energy sources, almost a quarter of which would be earmarked for key hydrogen infrastructure.

The commission suggests tackling existing bottlenecks at oil supply infrastructure in the region such as the Transalpine, Adria or SPSE pipelines. It also proposes targeted investment on upgrading refineries that are configured to run on Russian Urals crude. The commission made no direct reference to Hungary, which has said it cannot switch to solely using non-Russian crude without up to €750 million of investment in refinery upgrades and pipeline capacity expansion.

The investment recommendations presented on Wednesday complement previous proposals from the Commission aimed at cutting EU imports of Russian gas by two-thirds, or over 100 billion cubic meters per year, by the end of 2022. The EU is also trying to hammer out an agreement among member states to phase out Russian oil imports this year, although it faces pushback from Hungary among others.

The €210 billion of additional spending would be on top of investment required to implement the EU's climate and energy policies by 2030. The Commission’s latest recommendations together with the 2030 policies will allow the EU to save some €80 billion on gas imports, €12 billion on oil imports and €1.7 billion on coal imports.

EU officials confirmed that the proposed target for the share of renewables in the bloc's energy mix will increase to 45% by 2030, up from 40% previously. This would bring total renewable energy generation in the EU to 1,236GW by 2030, as compared to 511GW at present. The Commission points to solar panels as key to accelerating out of fossil fuel imports. It is eyeing 300GW of installed solar photovoltaics by 2028, double the present installations.

EU officials also confirmed a proposal for an EU-wide gas price cap. The cap would be a measure of "last resort" in the case of full disruption of Russian gas supplies, a senior official said, adding that it would be combined with curtailment of supply to industry and would require additional legislation.

"A price cap is an emergency measure," European Commission Executive Vice President Frans Timmermans told Argus. "It will be taken when there's massive disruption. But with one measure you can't make cheap out of expensive energy."

 

Pakistan: SBP and IFC join hands to promote Agriculture Finance through Warehouse Receipts Financing

Deputy Governor State Bank of Pakistan (SBP) Ms. Sima Kamil while addressing a two-day specialized training workshop on Electronic Warehouse Receipt Financing (EWRF) for banks observed that the training program will be instrumental to support SBP’s recent initiative to promote EWRF in the country.

Banks will be able to get hands on knowledge about EWRF product development, understanding the risk analysis, price determination mechanism and the international best practices.

She encouraged senior bankers to use the relevant knowledge of EWRF gained during the session and disseminate it in the industry for its smooth implementation.

EWRF is a mechanism whereby farmers can avail financing facility from banks by placing their produce and agricultural commodities. By doing so, farmers can avoid selling their produce on unfavorable prices just to ensure cash flows to meet input requirements of next crop. It will also help in reducing Pakistan’s high post-harvest losses.

Adoption of EWRF by banks and its enhanced uptake will not only facilitate banks to achieve higher levels of agriculture credit disbursement but will also help them enhance credit outreach.

Ms. Kamil noted that agriculture contributes almost a quarter to our GDP and employs half of the labor force. However, she regretted that people associated with agriculture sector face challenges in access to finance and modernize infrastructure that may facilitate them either in storing or timely disposal of their agricultural produce.

She added that SBP took the initiative of EWRF in view of the role of warehousing regime in increasing food security, reducing post-harvest losses and allowing bank financing to farmers against commodities as collateral. She hoped that it will facilitate traders and processors to purchase inputs they need, including seeds, fuel and fertilizers, before and during the harvest, when their seasonal financing needs are significant.

Parallel it will encourage investment in agricultural infrastructure in terms of building new, modern and commercially viable warehousing infrastructure. At outset, 25 banks signed System Usage Agreements (SUAs) with Naymat Collateral Management Company and SBP assigned indicative financing targets to these banks for FY 2021-22 and 2022-23. Now, these banks have started financing against maize crop in various districts of Punjab under the EWRF regime.

The Deputy Governor acknowledged the support extended by IFC in terms of technical assistance to Government of Pakistan and other key stakeholders to make building blocks for EWRF in Pakistan.

She expressed gratitude for IFC team led by its Country Manager for Afghanistan and Pakistan, Zeeshan Ahmed Sheikh and Ms. Nouma who has been coordinating an IFC-collaborated project for the promotion of EWRF in Pakistan. She also encouraged senior bankers to use the relevant knowledge of EWRF and disseminate in the industry for its smooth implementation.

Speaking on the occasion Zeeshan observed that innovative financing models, such as electronic warehouse receipts, are extremely important as they can unlock a massive amount of capital, bolstering the farming sector and, over the long run, supporting job creation and economic growth. He also acknowledged the Government of Japan for supporting the EWR work.

SBP organized the two-day training workshop in line with the EWRF Uptake Action Plan in collaboration with IFC. During the workshop, global experts from IFC and Pakistan shared their knowledge and experiences with senior banking officials regarding different modalities of collateralized commodity financing and EWRF. The program provided a deeper understanding of EWRF to banks that will help them to extend financing to farmers against agricultural commodities as alternate collateral.

This article was originally published in Eurasia Review

United States-Japan at Tokyo Summit to commit to jointly deter China

According to Nikkei Asia, the Japanese and United States governments have begun coordinating on the wording of a joint statement to be released during their summit meeting on Monday in Tokyo. 

The statement will clearly state a policy of cooperation to deter and respond to China's activities in the Indo-Pacific region.

The statement will also outline a policy of keeping Japan under the US nuclear umbrella, and the sharing of security strategies between the two countries. The partners will confirm the launch of the Indo-Pacific Economic Framework (IPEF), led by US and clarify Washington's involvement in Asia.

This will be the first face-to-face meeting between Japan's Prime Minister Fumio Kishida and US President Joe Biden. The two leaders' expected reference to deterring China's hegemonic behavior reflects their concern that Russia's invasion of Ukraine has implications for Asia.

The US is deepening its military commitment to Europe to deal with Russia, and, for the time being, the US will be forced to conduct a three-front strategy -- in Europe, the Middle East and East Asia. Despite the challenges, the US will again stress both domestically and internationally that its top priority is China, which the US believes is its only strategic competitor.

The previous joint statement published last year and delivered by then-Prime Minister Yoshihide Suga and Biden spoke of the importance of peace and stability in the Taiwan Strait for the first time in almost half a century. It also included the phrase ‘the importance of deterrence’ in the region.

This time they will strengthen the wording to include the statement that they will deter China's actions that undermine stability in the region, and if necessary, will cooperate to respond. The statement will also emphasize that they will not allow the status quo to be changed by force, and it will maintain the previous wording regarding the Taiwan Strait.

The two countries will maintain economic sanctions against Russia, which continues its aggression against Ukraine, and will condemn threats to use nuclear weapons. The statement will also again call for the complete denuclearization of North Korea.

The US will clarify its stance on protecting Japan under the nuclear umbrella. The US has been unable to dissuade Russia, which possesses nuclear weapons, from invading Ukraine, and concerns about the effectiveness of nuclear deterrence are spreading. Washington will reaffirm that if Japan is threatened with nuclear weapons, it is willing to defend Japan not only with conventional forces but also with nuclear weapons if necessary. This will be included in the joint statement.

The two countries will also confirm that they plan to share security goals and strategies, specifically, the National Security Strategy to be formulated by the end of the year. They will pledge to strengthen cooperation between the Japan Self-Defense Forces and the US military in areas such as troop operations, joint use of bases, and procurement of equipment, as they prepare for a possible emergency in Taiwan.

Prime Minister Kishida will also discuss with Biden the Japanese government's intended increase in defense spending, which had previously been limited to about 1% of gross domestic product, and its moves to develop a strike capability against enemy bases. That is, the ability to hit missile launch sites and other targets.

Regarding economic strategy, the US will establish a mechanism to deepen its involvement in Asia. The two countries will agree to hold the first economic version of a "2 plus 2" ministerial meeting, with the Japan-US ministerial talks serving as a command post, at an early date. They will also outline their basic policy of creating a stable supply chain for semiconductors among friendly countries and regions.

During his visit to Japan, President Biden will announce the launch of the Indo-Pacific Economic Framework, a new type of economic bloc, which more than 10 countries, including South Korea, Australia, the Philippines and Thailand are, expected to participate in. The US is deeply cautious about rejoining the Trans-Pacific Partnership (TPP) and will first use the IPEF as a forum to establish rules for digital trade and other areas.

 

United States makes attempt to mend relations with United Arab Emirates

US President Joe Biden seems to have initiated efforts to mend its relationship with Abu Dhabi. Lately, some cabinet members led by Vice President visited to the United Arab Emirates, an oil-rich nation in the midst of a critical leadership change.

Rejection and perceived disinterest from Washington has led the UAE to recently act more boldly on the global stage. It abstained from a US-led resolution at the United Nations that condemned Russia’s invasion of Ukraine. Emirati officials have also refused to increase oil production in an effort to lower gas prices and continue to pursue closer ties with China.  

Following the death of Sheikh Khalifa bin Zayed al-Nahyan, the country’s second president, who had officially ruled since 2004, Biden this week dispatched his most senior cabinet officials led by Vice President Kamala Harris. She was joined by Secretary of State Antony Blinken, Defense Secretary Lloyd Austin and CIA Director William Burns.

The visit by the Biden administration’s top brass was one to express condolences — and congratulations — to the new leader, Crown Prince Sheikh Mohammed bin Zayed al-Nahyan. Known as MBZ, he is the late president’s half-brother.

Harris, in remarks after a meeting said the purpose of the trip was to reaffirm the shared commitment we have to security and prosperity in this region and also how the American people have benefited from this relationship in terms of security and prosperity.” She called the UAE a friend and partner.

The trip came as US officials attempted to woo the monarchy amid a long list of strains between Abu Dhabi and Washington. Another issue is that of a longtime American foe Iran, as the UAE has rejected the Biden administration’s pursuit of a nuclear deal with Tehran. The tensions stand in stark contrast to the close ties the UAE held with the former administration.

Abu Dhabi welcomed then-President Trump’s exit from the Iran nuclear deal. Most notably, the Gulf state benefited from normalizing relations with Israel through American proposed military sales and Washington pulling its support from Israeli plans to annex the West Bank. 

“MBZ, because he sees himself as a man of vision, and Abu Dhabi of being a significant and important country, he expects respect and certainly under Biden, doesn’t think he’s been treated with respect,” said Simon Henderson, Director of the Bernstein Program on Gulf and Energy Policy at The Washington Institute.

“Trump and Jared Kushner the president’s son-in-law and senior advisor sort of treated him with respect.”

Experts said that the trip by Biden officials signals the administration knows it has some work to do.

“I think the high level delegation signals that Washington would like to repair the relationship and it’s really important that they do that,” said Hussein Ibish, a senior resident scholar at the Arab Gulf States Institute in Washington.

Mohammed, 61, has been considered the de-facto ruler of the Emirates for nearly 10 years, since then-President Khalifa suffered a stroke in 2014 and was largely sidelined from power up until his death. 

Mohammed has held tremendous sway throughout the region during his time as crown prince of Abu Dhabi and is described by regional watchers as having a vision, focused on growing the Emirates wealth, making its economy an important global player and pushing back against what it views as the threat of political Islam, in particular in neighboring Iran and Qatar.

Gerald Feierstein, former ambassador to Yemen and a distinguished senior fellow on US diplomacy at Middle East Institute, said Mohammed’s influence on the Trump administration’s Abraham Accords — the normalization agreements between Israel, the UAE and Bahrain — signaled the crown prince’s desire to be a driver of events of the region more broadly, than just the Gulf.  

The UAE has also garnered greater independence from the US

“For the Emirates, they consider the US a less reliable security and regional partner than it has been considered in the past and so they’re willing to craft their own independent foreign policy,” said Courtney Freer, nonresident fellow with the Brookings Institution.

Abu Dhabi took issue early on in the Biden administration with what it viewed as a weak response to threats and attacks the Emirates faced from Yemen’s Iran-backed Houthi rebels, including Biden removing the Houthi terrorist designation.

Ibish, of the Arab Gulf States Institute, said the robust US response to support Ukraine following Russia’s invasion underscored the feeling that Washington was abandoning its security commitments in the Middle East.  

“They look at the firm and united and resolute response to the invasion of Ukraine and compare it to those missile attacks by the Houthis and they feel very second best and not particularly looked after,” he said.

That has left leaders in the Emirates looking for help elsewhere.

“Whatever Washington wants, MBZ will make his own deal with Iran because they’re neighbors across the waters of the Gulf. And Dubai in particular, has important contacts with Iran at least on a commercial level,” Henderson said. 

Also at issue are negotiations that were reportedly rejected by the UAE to buy 50 F-35 fighter jets from the US amid defense security conditions for the acquisition, a UAE official told Reuters in December. 

A State Department spokesperson, requesting anonymity, told The Hill. “The administration remains committed to the sales and are continuing consultations with the UAE to ensure that we have a clear, mutual understanding with respect to Emirati obligations and actions before, during, and after delivery.” 

Before the Biden administration visit this week, the US had already started to take steps toward repairing the diplomatic relationship, Ibish noted, in the form of an apology by Blinken to MBZ last month for the Biden administration’s delay in responding to Houthi attacks in Abu Dhabi this year.

“It’s the apology that goes a long way because the response really did seem insufficient and particularly in the light of the Ukraine invasion, where the difference of the Western response is very stark,” Ibish added.

Feierstein added that the Blinken-MBZ meeting in Morocco was a step in the right direction that cleared away a lot of the underbrush in the relationship.

“No two states ever see anything eye to eye, there are always differences in opinion and of position. But what you do want is a strong institutional link that allows you to work through those issues,” he added.

 

Deliberations on payment mechanism in Afghanistan-Pakistan trade

During the first deliberation session on barter trade and other irritants facing Afghanistan-Pakistan trade, members from various relevant trade bodies and Chambers, the house unanimously resolved, “It is better to use banking channels for financial transactions”. 

The barter can be added as an alternative, umpteenth number of countries trade with Afghanistan and use third party payment method via international corresponding banks and face no sanctions and problems from any international agency like FATF.

These countries include CARs, Turkey, South Korea and some Far eastern countries, UAE, some European countries, China and India. The foremost action expected from State Bank of Pakistan is to discuss this with international corresponding and local commercial banks with support of Ministries and OFAC (A US Treasury sub agency) to remove barriers for Pakistan to bring in much needed foreign currency. This has been pending since a year and business community has voiced the issue at all levels.”

Later house deliberated all aspects relating to barter trade mechanism with Afghanistan and agreed that the process shall be developed carefully keeping in view the matters of credibility, integrity, efficiency, legality, government’s role, dispute resolution and arbitration, matters of sales tax refund and duty drawback, readiness of PSW, FBR, Pakistan Customs and where necessary the role of SBP to amend the needed clauses to support barter trade mechanism.

The house suggested that barter trade shall be started on trial basis for 3 months and re-evaluated for its feasibility. The matters of deficit and surplus, starting with zero rated categories like pharma and food items, relaxing and reducing duties on Afghan products to bring competitiveness with other countries like India and identification of 10 or more items initially for barter from both sides to ensure balance of trade were discussed.

To manage payments, it will require escrow account which must have multiple signatories to ensure transparency and formation of check and balance system.

Sales tax refunds and duty drawback are already a big issue in case of trade via land which will enhance in case of barter, to counter this, Jawed Bilwani, President PAJCCI, suggested to process barter trade under “Export Processing Zones” mechanism to make it better organized and easily monitored with less stress for business community.

The legality and framework for this alternate will be worked out and proposed to the Ministry accordingly. Additionally a SRO needs to be finalized prior to ensure the mechanism of Sales tax refund and duty drawbacks without further regulatory requirements else the interest of business community in this arrangement will be lost and a lucrative trading opportunity will not realize the full potential.

 

Barter trade shall only be used as alternate and shall not include products and companies which are already trading in dollars. Use of foreign exchange companies was not well received as it will increase the element of illegal payments and may fall under FATF regulations.

PSW & FBR system must have special module under this category for efficient management and to be linked with PAJCCI to reduce duplication of efforts and paper work while verifying transactions and arranging payments.

Zubair Motiwala said, “Detailed report of the session will be shared with participants, further cross border sessions will be held in coming weeks and later with Afghan side as joint session to finalize the proposal to be presented to both governments”.

He stated that PAJCCI strongly believes that using established banking procedures is preferable for trading but will use its experience to bring about viable barter trade mechanism while keeping in view all legal and practical requirements.

 

Chinese oil import from Iran on the rise, others to follow

China’s determination to bring Iran into its sphere of influence, and Iran’s increasing ability to evade international sanctions on oil consignments due to the crisis in the European theatre. 

Iran is likely to become more brazen over hydrocarbon exports in future, a US-based energy expert has told Seatrade Maritime News.

“Iran is an integral part of China’s Belt and Road Initiative. China has spent billions of dollars on its relationship with Iran and is positioning itself to spend billions more. This relationship is for the long term, covering the security, defense, and energy sectors. Iran is able to mitigate the effect of sanctions, and China can further its geopolitical ambitions to transform from a regional to global power,” Justin Dargin, an analyst at Oxford University, said.

The increase in Iranian exports can be perceived as the Iranian government assessing the Biden administration’s resolve to intervene forcefully, Dargin believes. A focus on bringing Iran back to the negotiating table, domestic concerns over Covid and inflation, and the United States and European Union efforts to restrain Russia, have encouraged Iran to pursue its sanctions-busting activity without fear of repercussions.

“Also, while Obama initiated the American ‘retreat’ from the Middle East to implement the Asian pivot, Trump exacerbated the perception of American isolationism.

The White House’s chaotic withdrawal from Afghanistan fed the perception that the US’s Middle East policy lacks any coherence. It is the perfect vacuum for China to enlarge its relationship with Iran. The Biden Administration has not attempted to punish to any appreciable degree the sanctions-evading activity,” he said.

“In light of these factors, it is likely that Iran will continue to engage and even expand its oil exports beneath the radar. It could become even more brazen in the process as Iran’s customers disregard the threat of an American response while the US is entangled in the European theatre.”

The Wall Street Journal said Iran's oil exports, largely China-bound, rose to 870,000 barrels a day in the first three months of the year, up 30% from an average of 668,000 barrels a day in full-year 2021.

Iran also anticipates that sanctions will be lifted soon as the world seeks additional oil supplies to mitigate Russian sanctions, amid supply shortfalls and volatility, Dargin said.

The National Iranian Tanker Company (NITC) recently announced that it will construct new crude tankers while it sends about 24 aging ships to be repaired in a bid to return to the global market.     

“This shows that Iran is readying itself to begin exports in short order. Several NITC tankers have even begun transiting international waters with their Automatic Identification Systems (AIS) turned on in highly visible trade with Iran’s Asian customers,” he said.

“Iran does have one of the largest tanker fleets globally, with an approximate total deadweight of 15.5 million tons. Still, it will take enormous modernization—inspection, testing, certification, and renovating and refurbishing—to restore the fleet to transit international waters in an appreciable capacity. But, with the windfall profits Iran has, it will not be economically hurting as it was several years ago.”

When the Trump administration reimposed sanctions to further isolate Iran under its ‘maximum pressure’ framework, Iranian production dropped precipitously after 2018, but has since rebounded to pre-sanctions levels of approximately 3.8 million barrels per day (mbpd) in anticipation that sanctions will be lifted at some point in the near future.

“However, while Biden entered office hoping that the nuclear deal could be revived, expectancy has fallen due to the stark rise in oil prices and increases in exports to Iran’s main allies, both of which reduced the internal and external pressure on Iran to compromise,” he said.

In the wake of the Russian invasion and the need for more global oil supply, there is little appetite to place additional pressure on Iran. Most of Iran’s oil heads to China, and China is buying more oil now than before the sanctions. India was purchasing Iranian oil but ceased in mid-2019 to comply with American sanctions, Dargin said.

“However, India is ready to buy Iranian crude once sanctions are lifted as its refiners have begun prepping. The Indian government has created a contractual template to swiftly reenter negotiations once Iranian oil is somewhat sanitized. This is also the trend with Iran’s other major Asian customers, such as South Korea, constructing the groundwork with working talks for importing Iranian crude, which is reasonably priced and simple to process compared to other grades,” he said.

The White House believes that China tranships Iranian crude to North Korea. Syria, Lebanon, and Iraq are other regional customers, while Malaysia and other countries serve as transhipment points to relabel the oil. Companies from several countries, some in Southern Africa, are being investigated for facilitating illicit Iranian oil trade, Dargin said.

“To sum up, it appears that Iran is becoming quite brazen with its oil exports, even with the hope of a speedy ‘legal’ return to the global market somewhat in tatters at the moment. Iranian ships have begun to turn on their AIS and China is importing ever-higher amounts of Iranian crude,” he said.

“Further, Iran is banking on the fact that the US and Europe are distracted by the European theater to take much notice or express concern about its activities. It seems that the global community will also, if not facilitate, then turn a blind eye to, Iranian shipments, if this relieves the pressure on the global oil market in the prelude to a continental-wide Russian oil ban.”

 

Who is responsible for killing of one million US citizens? COVID or Administration

According to a report by The Hill, deaths from COVID-19 have reached one million in the United States. The source of this data is none other than the Centers for Disease Control and Prevention. 

The US has had more deaths per capita than Western Europe or Canada. While new deaths have fallen, the total death count is still rising.

It is also expected that the United States, like other countries, has under counted the true number of deaths from the coronavirus.

Illustrating how high one million deaths originally seemed, then-President Donald Trump said in March 2020 that holding the country to between 100,000 and 200,000 deaths would mean “we all, together, have done a very good job.” 

Deaths have continued stacking up even into 2021 and 2022, after vaccines became widely available, disproportionately among people who did not get vaccinated or did not get booster shots.  

An analysis from the Peterson Center on Healthcare and the Kaiser Family Foundation found that about 234,000 US COVID-19 deaths, or roughly one quarter of the total, could have been prevented if people had been vaccinated. 

The share is even higher, at 60%, of deaths since vaccines became widely available in June 2021.  

“Since vaccines became widely available last summer, a total of 389,000 adults in the United States have died of COVID-19, and 6 in 10 of those deaths — about 234,000 deaths — could have been prevented by timely vaccinations,” the researchers found. “This analysis underscores the importance of continued efforts to increase the number of people vaccinated and boosted against COVID-19.” 

Globally, the World Health Organization recently reported that the total number of deaths is more than twice the number officially reported, once indirect deaths due to factors like health care systems being overwhelmed are taken into account. That wider total is almost 15 million deaths worldwide.  

While vaccines and booster shots continue to provide important protection against severe disease, new variants of the virus have thrown curveballs that have meant cases continue to spread, though they are much less dangerous among vaccinated and boosted people.  

There are still more than 300 people dying every day from the virus in the US on average, according to a New York Times tracker, though that is one of the lowest levels since the pandemic began. In addition to vaccinations, a new treatment pill from Pfizer known as Paxlovid has helped to take some of the teeth out of the virus.  

The White House is preparing for another wave of the virus in the fall and winter, which could infect as many as 100 million Americans, a senior administration official said earlier this month.  

The administration argues the country now has the tools to make such a wave much more manageable, and that the number of cases could be lower if Congress provides the funding necessary to purchase updated vaccines, more tests, and additional treatments. Without those tools, the virus could take a much more significant toll in a coming wave.  

As much of the country looks to move past the virus, though, funding is stalled in Congress. Republicans have opposed new funding unless it can be paid for with cuts elsewhere, and the parties have sparred over how to pay for it. The GOP has also demanded a vote to overturn the Biden administration’s move to lift a Trump-era pandemic border policy known as Title 42.  

White House COVID-19 response coordinator Ashish Jha on Twitter pointed to a hopeful trend, that even as cases have risen recently in the Northeast, deaths have stayed largely flat, which he attributed to high booster rates in those states and the effectiveness of new treatments. 

But he said funding is needed to ensure supplies of treatments and updated vaccines are available.  

“We’re at a point in the pandemic where we know how to manage the virus,” he wrote.  

Governor State Bank of Pakistan, new Chairman of Asian Clearing Union (ACU)

Dr. Murtaza Syed, Acting Governor State Bank of Pakistan (SBP) assumed the charge of Chairman of the Board of Directors of the Asian Clearing Union (ACU) in the 50th meeting of the ACU Board held in Islamabad on May 13, 2022 in both physical and virtual modes.

Established in 1974 with permanent headquarters in Iran, the Asian Clearing Union (ACU) is a payment arrangement system whereby member countries settle payments for intra-regional transactions among their central banks on a net multilateral basis. Currently, the Central Banks of Bangladesh, Bhutan, Iran, India, Maldives, Myanmar, Nepal, Pakistan and Sri Lanka are members of the ACU. The main objectives of the clearing union are to facilitate payments among member countries for eligible transactions, thereby economizing on the use of foreign exchange reserves and transfer costs, as well as promoting trade and banking relations among the participating countries. 

The Secretary General of ACU, Mrs. Lida Borhan Azad, presented the annual report on the operations of the union for the year 2020, which the Board approved and adopted.

The Board reviewed progress on the ongoing projects being undertaken by the union. It reviewed a new web based messaging system and constituted a sub-committee to finalize the recommendations for its implementation within six months. The Board also considered the report on issues faced by traders under the ACU mechanism and decided to implement the recommendations in the next three months. 

While appreciating the report on the use of domestic currencies for settlement of trade transactions prepared by the Reserve Bank of India (RBI), the Board requested RBI to convene a virtual seminar to enable member countries to gain a fuller understanding of the proposed mechanism. The Governors and head of the delegations of the countries also gave a broad overview of the economic development in their respective economies and shared their experiences in addressing the challenges emerging in the post COVID-19 global landscape.

Governor Central Bank of Myanmar, Than Nyein, Vice Governor Central Bank of Iran, Dr.Mohsen Karimi, Chief Economist Central Bank of Bangladesh Md. Habib ur Rehman, and Executive Director Nepal Rastra Bank Ramu Paudel participated in the meeting physically. Governor Dr. P. Nandalal Weerasinghe, and Deputy Governor of Central Bank of Sri Lanka, T.M.J.Y.P Fernando, Governor Maldives Monetary Authority Ali Hashim, Ms. Yangchen Tshogel Central Bank of Bhutan and Executive Director RBI Radha Shyam Ratho, attended the meeting virtually.

At the conclusion of the Board meeting, Mrs. Lida Borhan Azad relinquished the charge of Secretary General of the ACU after distinguished service of the Union for 15 years. While appreciating the services of Mrs. Lida Borhan, the Board appointed Farhad Morsali as the new Secretary General of the ACU, as recommended by the Central Bank of Iran.

The meeting ended with all member countries emphasizing their commitment to further enhancing their trade and banking relationships. It was decided that central bank digital currencies (CBDCs) would be the special topic on which research would be conducted during Pakistan’s chairmanship of the ACU over the next twelve months.

Shehbaz Sharif taking Pakistan further away from reconciliation with IMF

It may be said without mincing words and unequivocally that the latest decision of Prime Minister Shehbaz Sharif not to increase electricity and gas tariffs and prices of petroleum products has pushed Pakistan further away from reconciliation with International Monetary Fund (IMF).

Yesterday he was required to approve the increases, as a preamble to the commencement of negotiations between IMF and Pakistan. On the contrary he not only didn’t approve the increase, but announced a plan to pay Rs224 billion subsidies for four months spanning March-June 2022, without giving any clue as to how this additional amount will be mobilized.

As Sri Lanka started moving towards eminent default, many experts in Pakistan also started ringing bells that the country could also meet the same fate. At present Pakistan has foreign exchange reserves barely enough to meet six-week import. In case neither IMF nor any other friendly country extend the helping hand, default looks certain.

To add to the knowledge, a ‘fitness certificate from IMF’ is a must and without it no multilateral institution will be ready to extend fund. It is on record that Saudi Arabia has also said categorically that first Pakistan has to ‘normalize’ relations with IMF and only then it will give the promised dollars.

It is necessary to reiterate that IMF has promised: 1) to extend the tenure of the current program for another two years and 2) to raise the amount to US$8 billion, from US$6 billion. Now it is for Pakistan to agree on the terms and conditions and also to meet the agreed targets.

The consultations have been scheduled for May 18, 2022 and Pakistan was required to increase electricity and gas tariffs and raise petroleum prices. To be honest the incumbent government has not only failed in meeting the pre-requisite but also providing a time line for meeting these.

Imran Khan’s opponents have already started saying that he is responsible for the current mess. However, they tend to forget that by moving a non-confidence move against Khan and accepting the offices, they have accepted the challenge to put the economy on track.

To conclude please allow me to say that the incumbent Prime Minister and his team of economic advisors have failed in the first test. Even the bigger challenge is presentation of federal budget for the next financial year.

They have two options: 1) please IMF and remain in power or 2) go for the early elections. Ironically they can’t exercise either of the option because they will lose the support of masses and will not be able to get simple majority in the next election, what to talk of attaining 2/3 majority.   

Can election in Lebanon restore peace and stability in the country?

In Lebanon polling is being held today (Sunday) and the country’s future could depend on a high turnout among the diasporas and voting changes in the country. However, the Hezbollah stranglehold on the country is expected to remain.

Israel terms this Catch-22 that it has been facing for years. It wants to Lebanon to be stable and successful. It accuses Hezbollah of siphoning off resources to build up its arsenal. Israel believes, if Lebanon is weakened, Hezbollah wins by forcing Lebanese to flee the country as it continues to grow its Iranian-financed tentacles.

According to reports more than 100,000 Lebanese living abroad have already cast ballots for the parliamentary election, many backing political newcomers after the worst crisis since Lebanon’s 1975-90 civil war led to widespread poverty and a wave of emigration. Sunday’s election would be the first for the 128-member legislature since mass protests in October 2019 against political elites widely seen as responsible for decades of corruption and mismanagement.

The western media says, “Once a successful country seen as a stable, prosperous, diverse and beautiful global destination for tourists and intellectuals has long fallen into religious extremism and chaos”.

It is often alleged that Hezbollah has benefited from the chaos. When Saudi Arabia and Sunni Arab powers grew concerned about the Iranian-backed Shi’ite extremist movement, Lebanon began to look like it could fall into sectarian conflict similar to Iraq.

Later Riyadh appeared to withdraw support. Saudi Arabia had helped guarantee peace in the country after the Civil War of the 1970s and 1980s. However, the demographic-sectarian balance that underpins politics in Lebanon has been hijacked.

Western media openly says that Hezbollah not only uses Lebanon as a launching pad for threats against Israel; it also threatens the entire region. Yet Hezbollah does not have a way to solely control the parliament in Lebanon, and the sectarian voting system means it must ally with Christian and Druze parties. It has successfully done so in the past, controlling appointments to the presidency and even coming to control ministries.

The biggest tragedy is that Lebanon faces a huge financial crisis. Reports say that 80% of Lebanese are already in living poverty, and the Lebanese currency is losing value. This is likely, in part, the fault of the country’s elites who keep their money abroad.

Western media also plays mantra that the pandemic, inflation and the new crisis in Ukraine that has disrupted some global food supplies will add to the woes of the small country. Consider also that supply chain issues related to China mean that Lebanon will suffer even more. Endless and tough lockdowns in places like Shanghai are spreading global chaos. Lebanon was already on the brink. What might happen next?

Some media reports see Lebanon as being a victim of rivalries in the region. This posits that actors like Iran prey on Lebanon because they want to harm Israel. However the reality is much more complex. Iran uses Lebanon as an outlet to the Mediterranean, and Tehran is now involved via militias in the drug trade from Syria that threatens Jordan and the Gulf.

According to the western media, Lebanon is part of the Iranian axis, even though many Lebanese don’t approve of this hijacking. The UN has failed to rein in Hezbollah and enforce demands that its illegal weapons do not percolate around the country, yet Hezbollah continues to build up an arsenal.

A recent video appeared to show a new anti-ship missile in Hezbollah’s hands. Israel recently upgraded and received new naval platforms, such as the Sa’ar 6. This will matter in any future conflict with the armed Lebanese terror group.

Hezbollah also slammed US mediator Amos Hochstein recently, proclaiming in a video that it did not want to meet with any more “Steins,” a thinly veiled antisemitic reference that sought to highlight Hochstein’s Jewish background. With this language, it is hard to be optimistic about any future negotiations with Lebanon that might settle the maritime boundary and also enable peace and stability.

The US mantra is that Lebanese should work closely with the US and partners in the region to make sure Lebanon remains stable, regardless of the outcome of the election.

 

 

Iran calls on Muslims to halt Israeli atrocities

In a statement issued on the occasion of Nakba Day, which commemorates the illegal Zionist regime of Israel, Iran's Foreign Ministry noted that the only option to ensure Palestinian rights is for governments and Muslim nations to embrace resistance against the occupiers.

Any compromise with the Islamic Ummah's sworn foes, according to Foreign Ministry, supports the apartheid Zionist regime's heinous deeds and human rights violations.

The full text of the statement is as follows:

“May 14, 1948, the Nakba Day, is reminiscent of occupation, massacre and displacement of the true owners of the Palestinian land at the hands of Zionist occupiers and usurpers, and the onset of a trend of systematic violations of the Palestinian nation’s natural and basic rights.

Since that date, the criminal Zionists — backed by some Western powers — have usurped the holy land of Palestine with the forceful use of weapons and through carnage and plunder, laying the foundation for lasting insecurity and instability in the West Asia region, a situation that continues to this day.

The anniversary of the Nakba Day once again reminds the world’s governments and nations of their human and legal duty of defending the Palestinian people’s rights and puts on display the failure of international institutions and organizations to resolve one of the longest-running humanitarian and political crises in the world.

This comes especially at a time when the usurper Zionist regime has started a new round of desecrations of Palestine’s religious sites, Islamic sanctities and al-Quds as well as slaughter of the defenseless Palestinian people, which has, of course, been met with a crushing response from Palestine’s popular resistance and Intifada, with God’s grace.

The Islamic Republic of Iran’s Ministry of Foreign Affairs emphasizes addressing the issue of Palestine, as the foremost and principal issue of the Muslim world, and considers attempts by global Zionism to drive the issue into oblivion is doomed to failure.

As shown by history, any compromise with the sworn enemies of the Islamic Ummah encourages the apartheid Zionist government’s inhumane acts and violations of human rights. Muslim nations and leaders should know that the only way to realize the Palestinian people’s rights is maintaining Islamic unity and convergence and the world’s freedom-seeking governments and Muslim nations’ support for the resistance against occupiers and bullying powers.

The Islamic Republic of Iran believes that just and lasting peace will not be established in West Asia unless through the resolution of the fundamental issues in this crisis, including ending the organized occupation of Palestine, securing a return of refugees, deciding Palestine’s future through a referendum participated by all of its true owners, and finally, the formation of a unified Palestinian government, with Quds al-Sharif as its capital.

While expressing its full solidarity with the Palestinian people’s ideal cause and paying tribute to the martyrs and fighters on the path to freedom and the Muslims’ First Qibla, the Islamic Republic of Iran invites all governments and international bodies to shoulder their human and legal duties vis-à-vis the oppressed Palestinian people and prevent a continuation of occupation and crimes by the regime occupying al-Quds and the spread of this regime’s racist policies in occupied Palestine.”

 

US Defense Secretary succeeds in establishing contact with Russian Defense Minister, finally

It is beyond comprehension that United States sponsoring tons of lethal arms wants a ceasefire between Russia and Ukraine. Has the superpower realized it can’t defeat Russia or it is an attempt to recoup energy before making the final attempt to cause ‘substantial damage’ to Russia?

Another point of view is that Joe Biden has exhausted all the limits available to him regarding sale of arms to Ukraine. It may be recalled that Sen. Rand Paul hit the brakes Thursday on bipartisan hopes that the Senate could quickly pass nearly US$40 billion in Ukraine aid before leaving town for the week. 

Yet another point hardly being discussed is that the United States has lost the edge, because some European countries have started making gas payment in Russian ruble, having realized that no other source of supply is available, at least in the short term.

According to the latest reports, US Defense Secretary Lloyd Austin spoke with Russian Defense Minister Sergey Shoygu on Friday, marking the first time the two have spoken since before Moscow’s invasion of Ukraine began.

Austin “urged an immediate ceasefire in Ukraine and emphasized the importance of maintaining lines of communication,” Pentagon spokesman John Kirby said in a readout of the call.

Last time Austin had spoken with Shoygu on February 18, 2022, less than a week before Russia’s invasion began.

A month into the invasion, Kirby acknowledged that Austin and Joint Chiefs of Staff Mark Milley had unsuccessfully tried to engage with his counterparts. The Washington Post was the first to report the dilemma.  

“There are vehicles, we still have military-to-military communications with the Russians,” Kirby told Fox News. “But at the senior levels, where we think it’s really important particularly right now, that’s not happening. It is not happening because the Russians don’t seem to be interested.” 

A senior US defense official told reporters that the call was initiated by Austin and lasted about an hour, with the tone characterized as “professional.” 

It was unclear what changed on the Russian side to engage in the call, but Austin hopes it “will serve as a springboard for future conversations,” according to the official.

However, Austin “continues to have concerns about what’s going on in Ukraine,” and the call itself “didn’t specifically solve any acute issues or lead to a direct change in what the Russians are doing and what they’re saying,” the official said.

Whereas Austin and Milley have had a hard time speaking with their Russian counterparts, the two have remained close with their Ukrainian counterparts.

Austin has held multiple conversations with Ukrainian Defense Minister Oleksii Reznikov throughout the invasion, and the two most recently spoke on Thursday.

Also on Thursday, Milley spoke with Gen. Valery Zaluzhny, the commander-in-chief of the Ukrainian Armed Forces. According to a readout of the call, the two “continued to exchange perspectives and assessments of the ongoing Russian invasion of Ukraine.”

 

Naftali Bennett from one crisis to another

Lately a cartoon described the condition being faced by Israeli Prime Minister, Naftali Bennett, swimming in shark-filled waters, but he is not aware that there are more than a dozen sharks trailing him behind his back. 

The cartoon aptly illustrated where Bennett’s government stands right now, after resolving its coalition crisis with the Ra’am (United Arab List) Party.

That crisis was a reminder of how difficult it is to survive with a slim majority in the Knesset of 60 to 59 on a good day. It also demonstrated how sensitive the coalition is to any issue that could provoke controversy.

Mansour Abbas leading Ra’am into the coalition was celebrated worldwide as a historic breakthrough for Israel. Along with the Abraham Accords, an Arab party joining the coalition was seen internationally as Israel successfully entering a new era of mutually beneficial strategic cooperation with the Arab world despite the conflict with the Palestinians remaining unresolved.

Abbas enthusiastically and optimistically told The Jerusalem Post at an October 2021 press conference at the Knesset, where he presented the government’s massive new allocations to the Arab sector, that it would now become natural for Arab parties to join every Israeli governing coalition forever.

That historic breakthrough was nearly lost, due to Temple Mount violence and the lack of honest reporting about it. Like countless times in the past, violence on the Temple Mount that was exaggerated and fanned by fake news threatened to derail the sensitive fabric of life in the Holy Land.

Reports in the Arab world that made it look as though Israel was purposely trying to kill Muslims at prayer at the Aqsa Mosque nearly made it impossible for Abbas to climb down from the Mount and back into the coalition.

Even when Abbas was finally ready to end the crisis, another incident magnified in the international Arabic media around the world got in the way. Wednesday’s incident in Jenin in which Al Jazeera correspondent Shireen Abu Akleh was shot dead – and the bad press Israel got in its aftermath – could have forced Abbas to continue to freeze his party’s membership in the coalition, vote for a bill that would initiate an election and perhaps even torpedo Bennett’s government.

Abbas canceled a press conference he had scheduled in Kafr Kassem, called Abu Akleh a martyr and said he would insist on an international investigation of the incident. He would have carried on his protest of the incident longer and scored more points with his constituents, if he had had time.

But Abbas had to announce how his party would vote on the Likud’s Knesset dissolution bill in the afternoon and could not wait. His speech about “giving the coalition another chance” could have been written the day he began what was essentially a fake crisis that he initiated to look like the defender of al-Aqsa while the Knesset was on recess.

Abbas knows that he needs as much time as he can get in the coalition for his constituents to be able to see with their own eyes – or at least with their pocketbooks – the positive results of him joining.

What made it easier for Abbas to justify unfreezing Ra’am’s membership in the coalition was the foolishly unruly behavior of the opposition.

He spoke immediately after opposition leader Benjamin Netanyahu blasted him in a speech in the Knesset plenum that was supposed to be about Theodor Herzl.

Netanyahu picked yet another fight with Abbas, even though Ra’am could be a very easy coalition partner for him in the future. Every time Netanyahu calls Abbas “a terror supporter” or pretends he did not negotiate Ra’am building a bond with the Likud, Bennett’s coalition gets stronger.

The most right-wing MK in the Knesset, Itamar Ben-Gvir, helped strengthen the coalition even more by crashing Abbas’s press conference in the Knesset. Alternate Prime Minister Yair Lapid said later that the public prefers Abbas in the coalition over Ben-Gvir.

Then there was the opposition’s most uncouth MK, David Amsalem, who shocked MKs in both the coalition and opposition three times on Wednesday.

First he started an unnecessary fight with Knesset Speaker Mickey Levy, threatening the former Jerusalem police chief. Then he insisted on responding in the plenum to a consensus bill proposed by deaf MK Shirley Pinto that would require government offices to speak to deaf people via text messages. The bill passed 40-0, but Amsalem still had to speak against it.

Finally, Amsalem left a live interview with Channel 12 to cast the deciding vote on a bill. Meretz MK Yair Golan was on the same program, and the two had paired off to leave the coalition and opposition with the same balance in the plenum. But Amsalem left Golan as he was speaking next to him and raced up to vote.

It was less noticed by the coalition, but another MK who embarrassed herself was former coalition chairwoman Idit Silman. She claimed in a TV interview that one of the reasons she defected to the opposition was that the government had built a “Reform Kotel.”

She knows full well that no progress has been made on implementing the Western Wall agreement, that the family prayer site is not intended only for Reform Jews, that Reform is not a slur, and that while Bennett did build what he called the “Ezrat Israel,” it was when he was Jerusalem affairs minister under Netanyahu in 2014.

Silman said in the Knesset cafeteria that she thinks her bolting the coalition will prevent the site’s renovation. She said that since she left, the coalition has had to go “rightward” – yamina in Hebrew. But the coalition’s cooperation with the Joint List that came as the result of her departure has proven that the opposite is true.

Now that the fight with Abbas is over, there are plenty of challenges that await the coalition.

The sharks approaching Bennett include Jerusalem Day celebrations in two weeks, next month’s visit of US President Joe Biden to Israel, attempts to pass next year’s state budget that will begin on June 16, wavering Yamina MK Nir Orbach’s demand to hook up unauthorized outposts to the national electricity grid, and the pregnancy of New Hope faction head Sharren Haskel.

Haskel is due at the end of July, around the same time the Knesset will leave for its next recess. If she gives birth early, she may have to bring her newborn into the plenum to vote, as Pinto did six days after the birth of her child in December.

Jerusalem Day will be the first challenge. Opposition officials said they intend to exploit the holiday to anger Ra’am again, but they said they do have limits.

“We won’t cause a security crisis to cause a political crisis with Ra’am, but we will call for people to go on the Temple Mount on Jerusalem Day, of course,” a Likud spokesman said.

The spokesman said he did not think Netanyahu would ascend the Temple Mount, but acknowledged that it would not be the first time such a controversial step was taken by the head of the opposition from the Likud.

“It’s clear to everyone that the next crisis with Ra’am is only a matter of time,” the spokesman said. “This past week was not ideal for the opposition, but we won’t give up. They have dozens of bills in the pipeline that we stopped. They aren’t even trying to pass them. Even some they put on the agenda they took back. This doesn’t look like a government that can last very long. It can last a few weeks, but it is bound to end soon.”

In the weeks ahead, the coalition intends to continue the strategy that worked this week. Uncontroversial socioeconomic legislation will be advanced. Bills that do not have a consensus will have to wait.

Coalition bills will be put on the agenda only if a majority is obtained for them well in advance. Opposition bills will be passed by the coalition if they make sense and do not cost money, as eight were on Wednesday.

De facto coalition chairman Boaz Toporovsky said he intends to proceed with caution, knowing full well that there are plenty of sharks ready to attack. But he was not afraid of exulting about the opposition backing down from bringing the Knesset dissolution bill to a vote.

“The opposition surrendered and pulled back the bill,” Toporovsky said. “Another political spin crashed. They are scared. They know they have no majority, neither in the Knesset nor in the public. I recommend that all our doubters wait patiently and watch our government be strong and function. The unified coalition will continue to come to the Knesset and work hard for the entire Israeli public.”

Courtesy: The Jerusalem Post