Saturday, 8 April 2023

Saudi team in Tehran to discuss reopening diplomatic missions

A Saudi technical team arrived in Tehran on Saturday to discuss reopening Saudi Arabia's diplomatic missions in Iran, Saudi Press Agency (SPA) reported.

According to the report, Saudi Arabia will reopen its embassy in Tehran and consulate in Mashhad. This is considered the first official visit of a Saudi delegation to Tehran since 2016.

This comes in implementation of the joint tripartite agreement of Saudi Arabia, Iran and China, and to what was agreed upon by the two sides during the talks between the two foreign ministers on Thursday.

The Saudi technical team, headed by Nasser Al-Ghanoum, met with the Chief of Protocol at the Iranian Ministry of Foreign Affairs Ambassador Honardost at the Ministry of Foreign Affairs headquarters in Tehran.

During the meeting, the Saudi team chief expressed his thanks to Ambassador Honardost for the warm welcome and facilitating the team's arrival procedures. Honardost expressed his country's readiness to provide all facilities and support to facilitate the mission of the Saudi team.

On Thursday, Saudi Arabia and Iran had agreed to reopen diplomatic missions in the two countries within a two months period as agreed upon in March, according to a joint statement issued following the historic meeting between Foreign Minister Prince Faisal Bin Farhan and his Iranian counterpart Hossein Amir Abdollahian in Beijing.

The two sides agreed to proceed with necessary measures to open their embassies in Riyadh and Tehran, and their consulates general in Jeddah and Mashhad.

Technical teams from both sides will continue to coordinate and discuss ways to enhance cooperation between the two countries, including the resumption of flights, bilateral visits of public and private sector delegations, and facilitating issuance of visas.

Israel launches strikes in Lebanon and Gaza

Israel said it struck targets belonging to the Palestinian group Hamas in southern Lebanon and Gaza on Friday, amid rising tension days after Israeli police stormed the Al-Aqsa Mosque in Al-Quds.

The escalation in tensions comes after Israeli forces stormed the mosque in occupied East Jerusalem on successive days this week, firing stun grenades and attacking Palestinians as they gathered for Ramadan prayers.

The strikes came hours after dozens of rockets were fired from Lebanon into Israeli territory. The barrage from Lebanon was the largest since a 2006 war between the two countries and raised fears of a wider regional escalation.

Israel Defense Forces (IDF) international spokesperson Lt. Col. Richard Hecht said Friday the Israeli strikes on southern Lebanon were focused mainly on Palestinian targets in the area from which they believe the rockets were launched into Israel.

The Resistance in Gaza has informed the mediators that any massive aggression against the Strip will be met with an unprecedented response.

The sources added the Resistance has placed its long-range missile units on maximum alert, and the scope and extent of the response will be determined according to the size of the bombing and the targets that are attacked.

The source added that there is complete coordination between the Resistance in Gaza and the operations room of the Axis of Resistance in the region.

In the latest development, two people were killed after resistance fighters opened fire on a vehicle in the occupied West Bank as tensions between Israel and the Palestinians intensify.

The Magen David Adom ambulance service said two women in their 20s were killed and a third in her 40s was seriously wounded. The medics said they pulled the three unconscious women out of their car, which had apparently crashed after gunmen opened fire at it from a nearby vehicle.

The occupation army also shut down the Hamra military checkpoint in the northern West Bank, blocking the movement of Palestinian traffic, according to local sources. They blocked traffic through the checkpoint in both directions.

The checkpoint straddles the road connecting the northern provinces of the West Bank with Jericho and the neighboring villages in the east of the territory.

 

French approach towards China not in line with the United States

High-profile diplomatic meetings on opposite sides of the world are underscoring growing tensions between the United States and Europe in how to engage with China.

French President Emmanuel Macron, on a three-day trip to China, is billing his outreach as an effort to recruit Chinese President Xi Jinping to play a major role in building peace between Ukraine and Russia, with an eye on reining in Russian President Vladimir Putin.

The summit comes as Chinese officials have warned of consequences and retaliation in response to House Speaker Kevin McCarthy hosting Taiwan’s President Tsai Ing-wen in California.

McCarthy, speaking to reporters following his meeting with Tsai, said he hoped Macron asked Xi not to fund Russia’s war in Ukraine and reiterated that democracy makes the world safer and stronger.

“I hope he delivers a message that Americans meeting with President Tsai is positive for the same aspect that he is meeting with President Xi,” he said. 

The dueling diplomatic summits highlight the gap between the United States and Europe over how to deal with China.

While the Biden administration and lawmakers on both sides of the aisle describe Xi as working to reshape the world in the view of China’s authoritarian model, European leaders are less unified on the risks versus rewards of close ties with Beijing.

The Élysée Palace said Macron and President Biden, in a call ahead of the French leader’s trip, discussed a common desire to engage China to accelerate the end of the war in Ukraine and to participate in building a lasting peace in the region.

The administration was more reserved in its description of the conversation. Two-line readout from the White House simply stated that Biden and Macron talked about the French president’s upcoming travel and reiterated support for Ukraine. 

Macron’s visit, accompanied by dozens of business officials, highlights France’s focus on maintaining, if not strengthening, economic ties to China, even as the US has for months warned that Beijing is considering sending weapons to Russia for use in its war in Ukraine.

“I am convinced that China has a major role to play in building peace. This is what I have come to discuss, to move forward on,” Macron tweeted on Thursday. “With President Xi Jinping, we will also talk about our businesses, the climate and biodiversity, and food security.”

Xi has sought to portray himself as a global peacemaker. Alongside Macron on Thursday in Beijing, he said China is committed to facilitating peace talks and a settlement on the Ukraine crisis, affirmed that a nuclear war should never be fought, and that legitimate security concerns of all parties should be taken into account.

French officials say they do not see a conflict of interest between maintaining trade ties with China while trying to engage Xi to act more responsibly.

“Talking with China and having direct engaging discussions doesn’t mean you erase the economic ties,” one French diplomat told The Hill.

“Personal engagement is even more important with China, after three years of pandemic, and considering the nature of the regime,” the diplomat continued, a reference to Xi’s near total power over the state. 

How Europe, US differ on China

But critics say that Macron’s coterie of business executives undermines any effort to push Xi to get tough on Russia. 

“In a situation where we’re trying to talk strategy with the Chinese, trying to get them to commit not to deliver weapons to Russia, bringing along so many business people with all deals in their minds, and Euro signs in their pupils, is the wrong signal,” said Roland Freudenstein, vice president and head of GLOBSEC Brussels, a think tank based in Slovakia. “It means that you come with a carrot, but you don’t come with a stick, and any talk of the stick is not valid at that moment.” 

Other experts though said that Macron should not be made into a boogeyman from this visit to China, considering that Europe has business interests to maintain in China.

“Both the U.S. and Europe have this new sort of idea that China is a rival, a partner, and a competitor. For the U.S., the ordering is probably rival first, then competitor, then partner. For Europe, that used to be the other way around,” said Matthias Matthijs, European expert at the Council on Foreign Relations.

“The Europeans are slowly moving closer to the American line on China, but the US has also moved very aggressively in a different direction than, say, it was during the Obama administration, and the Europeans aren’t quite there yet because they have no reason to be,” added Matthijs, also a professor of international political economy at Johns Hopkins University’s School of Advanced International Studies.

Biden and Xi have not spoken since they met in Bali, Indonesia, on the sidelines of the Group of 20 Summit in November 2022, but Biden said he would talk to Xi in the wake of the Chinese spy balloon traversing the United States in February. 

When asked about the phone call between Biden and Macron, National Security Council spokesman John Kirby on Wednesday declined to provide further details but said the president was “grateful” that Macron called him before his trip to Beijing.

United States always soliciting war, not peace

In a brilliant op-ed published in the New York Times, the Quincy Institute's Trita Parsi explained how China, with help from Iraq, was able to mediate and resolve the deeply-rooted conflict between Iran and Saudi Arabia, whereas the United States was in no position to do so after siding with the Saudi kingdom against Iran for decades.

The title of Parsi's article, "The US is not an indispensable peacemaker", refers to former Secretary of State Madeleine Albright's use of the term "indispensable nation" to describe the US role in the post Cold War world.

The irony in Parsi's use of Albright's term is that she generally used it to refer to US war-making, not peacemaking. In 1998, Albright toured the Middle East and then the United States to rally support for President Clinton's threat to bomb Iraq. After failing to win support in the Middle East, she was confronted by heckling and critical questions during a televised event at Ohio State University, and she appeared on the Today Show the next morning to respond to public opposition in a more controlled setting.

Albright claimed, "..if we have to use force, it is because we are America; we are the indispensable nation. We stand tall and we see further than other countries into the future, and we see here the danger to all of us. I know that the American men and women in uniform are always prepared to sacrifice for freedom, democracy and the American way of life."

Albright's readiness to take the sacrifices of American troops for granted had already got her into trouble when she famously asked General Colin Powell, "What's the use of having this superb military you're always talking about if we can't use it?" Powell wrote in his memoirs, "I thought I would have an aneurysm."

But Powell himself later caved to the neocons, or the "fucking crazies" as he called them in private, and dutifully read the lies they made up to try to justify the illegal invasion of Iraq to the UN Security Council in February 2003.

For the past 25 years, administrations of both parties have caved to the "crazies" at every turn. Albright and the neocons' exceptionalist rhetoric, now standard fare across the US political spectrum, leads the United States into conflicts all over the world, in an unequivocal, Manichean way that defines the side it supports as the side of good and the other side as evil, foreclosing any chance that the United States can later play the role of an impartial or credible mediator.

Today, this is true in the war in Yemen, where the US chose to join a Saudi-led alliance that committed systematic war crimes, instead of remaining neutral and preserving its credibility as a potential mediator.

It also applies, most notoriously, to the US blank check for endless Israeli aggression against the Palestinians, which doom its mediation efforts to failure.

For China, however, it is precisely its policy of neutrality that has enabled it to mediate a peace agreement between Iran and Saudi Arabia, and the same applies to the African Union's successful peace negotiations in Ethiopia, and to Turkey's promising mediation between Russia and Ukraine, which might have ended the slaughter in Ukraine in its first two months but for American and British determination to keep trying to pressure and weaken Russia.

Neutrality has become anathema to US policymakers. George W. Bush's threat, "You are with us, or you are with the terrorists," has become an established, if unspoken, core assumption of 21st century US foreign policy.

The response of the American public to the cognitive dissonance between our wrong assumptions about the world and the real world they keep colliding with has been to turn inward and embrace an ethos of individualism.

This can range from New Age spiritual disengagement to a chauvinistic America First attitude. Whatever form it takes for each of us, it allows us to persuade ourselves that the distant rumble of bombs, albeit mostly American ones, is not our problem.

The US corporate media has validated and increased our ignorance by drastically reducing foreign news coverage and turning TV news into a profit-driven echo chamber peopled by pundits in studios who seem to know even less about the world than the rest of us.

Most US politicians now rise through the legal bribery system from local to state to national politics, and arrive in Washington knowing next to nothing about foreign policy. This leaves them as vulnerable as the public to neocon clichés like the ten or twelve packed into Albright's vague justification for bombing Iraq: freedom, democracy, the American way of life, stand tall, the danger to all of us, we are America, indispensable nation, sacrifice, American men and women in uniform, and "we have to use force."

Faced with such a solid wall of nationalistic drivel, Republicans and Democrats alike have left foreign policy firmly in the experienced but deadly hands of the neocons, who have brought the world only chaos and violence for 25 years.

All but the most principled progressive or libertarian members of Congress go along to get along with policies so at odds with the real world that they risk destroying it, whether by ever-escalating warfare or by suicidal inaction on the climate crisis and other real-world problems that we must cooperate with other countries to solve if we are to survive.

It is no wonder that Americans think the world's problems are insoluble and that peace is unattainable, because our country has so totally abused its unipolar moment of global dominance to persuade us that that is the case. But these policies are choices, and there are alternatives, as China and other countries are dramatically demonstrating.

President Lula da Silva of Brazil is proposing to form a "peace club" of peacemaking nations to mediate an end to the war in Ukraine, and this offers new hope for peace.

During his election campaign and his first year in office, President Biden repeatedly promised to usher in a new era of American diplomacy, after decades of war and record military spending. Zach Vertin, now a senior adviser to UN Ambassador Linda Thomas-Greenfield wrote in 2020 that Biden's effort to "rebuild a decimated State Department" should include setting up a "mediation support unit… staffed by experts whose sole mandate is to ensure our diplomats have the tools they need to succeed in waging peace."

Biden's meager response to this call from Vertin and others was finally unveiled in March 2022, after he dismissed Russia's diplomatic initiatives and Russia invaded Ukraine.

The State Department's new Negotiations Support Unit consists of three junior staffers quartered within the Bureau of Conflict and Stabilization Operations. This is the extent of Biden's token commitment to peacemaking, as the barn door swings in the wind and the four horsemen of the apocalypse - War, Famine, Conquest and Death - run wild across the Earth.

As Zach Vertin wrote, "It is often assumed that mediation and negotiation are skills readily available to anyone engaged in politics or diplomacy, especially veteran diplomats and senior government appointees. But that is not the case. Professional mediation is a specialized, often highly technical, tradecraft in its own right."

The mass destruction of war is also specialized and technical, and the United States now invests close to a trillion dollars per year in it. The appointment of three junior State Department staffers to try to make peace in a world threatened and intimidated by their own country's trillion-dollar war machine only reaffirms that peace is not a priority for the US government.

By contrast, the European Union created its Mediation Support Team in 2009 and now has 20 team members working with other teams from individual EU countries. The UN's Department of Political and Peace Building Affairs has a staff of 4,500, spread all across the world.

The tragedy of American diplomacy today is that it is diplomacy for war, not for peace. The State Department's top priorities are not to make peace, nor even to actually win wars, which the United States has failed to do since 1945, apart from the reconquest of small neocolonial outposts in Grenada, Panama, and Kuwait.

Its actual priorities are to bully other countries to join US-led war coalitions and buy US weapons, to mute calls for peace in international fora, to enforce illegal and deadly coercive sanctions, and to manipulate other countries into sacrificing their people in US proxy wars.

The result is to keep spreading violence and chaos across the world. If we want to stop our rulers from marching us toward nuclear war, climate catastrophe, and mass extinction, we had better take off our blinders and start insisting on policies that reflect our best instincts and our common interests, instead of the interests of the warmongers and merchants of death who profit from war.

 

Friday, 7 April 2023

Pakistan Stock Exchange remains in the grip of volatility and uncertainty

Pakistan Stock Exchange (PSX) witnessed volatility during the week ended on April 07, 2023 owing to economic uncertainty, further exacerbated by political tension that persisted within the country. However, the market showed some resistance, and moved into positive territory come Wednesday when the State Bank of Pakistan (SBP) hiked rates by lesser than expectations, by 100bps to 21%, contrary to market expectations of a 200bps increase.

News flows of a Saudi Arabia assurance of US$2 billion primarily helped boost investors’ confidence. However, the news of the cancellation of a Finance Minister’s earlier planned visit to the US for IMF and World Bank spring meetings, once again shattered investor confidence, resulting in the market closing in the red on the last trading session. The market closed almost flat.

Moreover, participation in the market improved, increasing by 19.4%WoW as the average daily traded volume was reported at 110.2 million shares, as against 92.3 million shares a week ago.

Other major news flows during the week included: 1) Country’s foreign exchange reserves eroded by US$56 million, 2) March inflation rose to 35.4%, highest since 1965, Pakistan fought war with India, 3) China rolled over US$2 billion loan, 4) trade deficit during first nine months of current financial year shrank to US$22.9 billion YoY, 5) GoP raised PKR2.24 trillion via T-Bills auction, 6) FBR suffered massive shortfall of PKR304 billion during July-March period.

Sector-wise, Modarabas, Woollen, and Miscellaneous emerged the top performers. As against this, Tobacco, Leather & Tanneries, and Close-end Mutual Funds were amongst the worst performers.

Flow wise, selling was led by Insurance companies with a net sell of US$4.8 million. Individuals absorbed most of the selling with a net buy of US$2.7 million.

Top performing scrips were: SML, PSEL, FATIMA, EPCL, and BNWM, while laggards included: PAKT, MUREB, AIRLINK, EFUG, and HCAR.

Market is expected to remain jittery until there is a clear picture on the IMF front, the news of the cancellation of Finance Minister’s visit has further added to the uncertainty in this matter. If political tension settles, the market's confidence may also be restored.

Until then, investors are advised to take a cautious approach while building new positions. Analysts continue to advocate the stocks with dollar-denominated revenue streams, i.e. Technology and E&P sector, to hedge against the currency risks.

China attains status of ‘Lender of Last Resort’

China has become a major rescue lender for heavily indebted countries. In 2022, loans to countries in debt distress accounted for 60% of China’s overseas lending portfolio – up sharply from just 5% in 2010.

Over the past two decades, Chinese institutions have provided US$240 billion in rescue lending to 22 developing countries. Of that sum, US$170 billion was provided through the People’s Bank of China’s swap line network – a system whereby central banks agree to exchange currencies.

The rest was offered through other means such as bridge loans or balance of payments support by Chinese state-owned banks and enterprises, including the China Development Bank. These loans are provided, generally with high interest rates, mostly to middle-income countries, which account for four-fifths of China’s overall lending. Low-income countries are given grace periods and maturity extensions.

These loans, often doled out as part of China’s Belt and Road Initiative, have been highly criticized for creating debt traps for cash-strapped borrowers. Countries like Sri Lanka, Zambia and Ghana are currently in talks with Beijing to restructure their debt.

More governments are struggling to make payments amid a global downturn. There is growing concern about China’s ability to refinance the loans and avoid financial problems at home if debtors can’t repay them.

 

Chinese refineries buying more oil from Iran

Chinese private refineries are buying more Iranian oil as competition for supplies from Russia rises, Bloomberg reported. The teapots are prioritizing the flows, with Russian supplies getting pricier as mainstream buyers such as state-owned Chinese refiners and Indian processors take a greater share, according to analysts and trade data.

In March 2023, China’s imports of Iranian crude and condensate jumped 20%MoM to 800,000 barrels a day, and are on track to extend gains in coming months, according to Emma Li, an analyst with data intelligence firm Vortexa Ltd.

While Iranian oil has long been sanctioned by the US, refiners in China have proved to be a consistent outlet. 

Most Iranian oil used to go to state-owned refineries but the private refiners in Shandong especially are now running the show, said Homayoun Falakshahi, senior crude oil analyst at Kpler, the data and analytics firm.

Iranian President Ebrahim Raisi has said that the oil and gas sector experienced a growth of nine percent in the past Iranian calendar year 1401 (ended on March 20).

Oil Minister Javad Oji has recently said that a new record high will be reached in the country’s oil export in the current Iranian calendar year.

The country’s oil export in 1401 was 83 million barrels more than that of 1400, and 190 million barrels more than the export in 1399, the minister announced.

Underlining that now oil export has reached the highest figure in the last two years, the official said, “Considering that the Oil Ministry is one of the main providers of the country's foreign currency; in the 13th government, despite the tightening of cruel sanctions, fortunately, thanks to the grace of God and the efforts of our colleagues in the country's oil and gas industries, there are good records in the field of exporting crude oil, gas condensate, and petroleum and petrochemical products.”

Despite the negative impacts of the U.S. sanctions, Iran has been ramping up its oil production and exports over the past few months.

In his remarks in November 2022, President Raisi highlighted the failure of the enemy’s policy of maximum pressure, saying the country’s oil export has reached the pre-sanction levels.

Back in January, the U.S. Energy Information Administration (EIA) in a report put Iran’s average oil production in 2022 at 2.54 million bpd, 140,000 bpd more than the previous year.

Iran's oil production in 2021 was about 2.4 million bpd.