Three-year high for shares

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BNI to pay Rp 3.85t in dividends, appoints Agus Martowardojo as top commissioner

first_imgThe bank projected that this year’s NPL would be steady at between 2 percent and 2.2 percent, already factoring in internal and external dynamics, including the negative impact of the coronavirus, Anggoro said.Read also: Indonesia undertakes monetary, fiscal measures to fight effects of virus“We will prepare a strategy for the worst-case scenario. We are still going to expand, but in the sectors [affected by the coronavirus outbreak], we will be very prudent,” Anggoro said, referring to the sectors of manufacturing, health and pharmaceuticals, tourism, aviation and hotels as those affected by the outbreak.In the shareholders meeting, the publicly listed bank also appointed former Bank Indonesia governor Agus Martowardojo as its new president commissioner, replacing Ari Kuncoro, who was appointed deputy commissioner at state lender Bank Rakyat Indonesia (BRI).“With Pak Agus Martowardojo’s experience in the banking world, we hope to be able to cooperate with the directors and make BNI an even bigger state-owned bank,” State-Owned Enterprises (SOE) Minister Erick Thohir said in a written statement on Thursday. The shareholders also appointed Pradjoto as the bank’s vice president commissioner, replacing Hambra. On its board of directors, shareholders promoted its previous vice president director, Herry Sidharta, as the new president director, replacing Achmad Baiquni. Herry’s previous position as vice president director was filled by Anggoro Eko Cahyo. BNI is the third bank to announce its dividend payouts this week, following BRI and Bank Mandiri.\Read also: BRI to pay Rp 20.6 trillion in dividendsBRI announced on Tuesday its plans to distribute Rp 20.6 trillion in dividends, equal to 60 percent of the bank’s profit, to its shareholders. The ratio exceeds the 50 percent dividend payout of 2018.Bank Mandiri announced on Wednesday it was going to distribute Rp 16.49 trillion to its shareholders under a similar dividend payout ratio as BRI, notably higher than the 45 percent payout of 2018.With BNI, Bank Mandiri and BRI having conducted their annual shareholders meetings this week, the SOE minister’s plan to shake up executives at the three state-owned banks, which he announced last week, has been concluded. The shakeup is part of Erick’s efforts to improve the performance of Indonesia’s SOEs.Read also: Bank Mandiri to pay $1.2b dividends, appoints Chatib Basri as top commissioner “BNI proposed 25 percent, because we foresee that we still need room to grow. With dividends at 25 percent, the retained capital will be bigger,” newly appointed BNI vice president director Anggoro Eko Cahyo told a press briefing after an annual general shareholders meeting in Jakarta on Thursday. The bank’s retained capital at 75 percent of last year’s profit amounts to Rp 11.54 trillion. Anggoro added that the new PSAK 71 accounting standard would affect the company’s capital adequacy ratio (CAR) by approximately 2 percentage points, so its CAR of 19.7 percent would likely decrease to 17.7 percent. The new standard requires a larger loan loss provision so that banks could cover both good and bad loans as opposed to only bad loans in the past.The publicly listed bank’s net profit grew 2.5 percent to Rp 15.38 trillion in 2019 from Rp 15.01 trillion in the previous year, marking a significant slowdown from the 20.1 percent expansion recorded the year prior. The nonperforming loan (NPL) ratio rose to 2.3 percent last year, a 40-basis point increase from an NPL ratio of 1.9 percent in 2018. State-owned lender Bank Negara Indonesia (BNI), will distribute Rp 3.85 trillion (US$281 million) in dividends to shareholders and has appointed former central bank governor and ex finance minister Agus Martowardojo as its president commissioner. The dividends are equal to 25 percent of the bank’s 2019 profit of Rp 15.38 trillion, an unchanged ratio from the previous year. BNI’s shareholders will receive a dividend of Rp 206.45 per share, an increase of 2.57 percent from last year’s dividend of Rp 201.28 per share.The state, which holds 60 percent of the bank’s shares or a total of 11 billion shares, will receive a dividend of Rp 2.31 trillion. center_img Shares of BNI, traded at Indonesia Stock Exchange under the code BBNI, closed at Rp 7,925 on Thursday, 1.93 percent higher than the previous trading day. The bank’s stocks have fallen 8.02 percent in the past year, in line with the broader benchmark Jakarta Composite Index’s (JCI) 9.3 percent fall. (ydp)Topics :last_img read more

One killed, two houses destroyed in Tana Toraja landslide

first_imgA landslide hit Maulu hamlet in Rembon district, Tana Toraja, South Sulawesi, on Thursday morning, killing a villager and destroying two houses. Usman Tato, 65, was buried inside his house, which was located on a slope in the village, at around 4 a.m. local time. Tana Toraja Disaster Mitigation Agency (BPBD) official Alfian Andi Lolo said that this was the second landslide to occur on the slope. “When the first landslide occurred, the victim’s children asked him to leave his house since the first landslide happened right next to the deceased’s house. However, he ignored the warning, and died when the second landslide hit,” Alfian said. The victim’s body was recovered by his family and neighbors. According to Alfian, the area had experienced downpours over the last three days. Landslides are common in Tana Toraja as the area is mountainous and deforestation has left slopes bare and prone to rainy season landslides.“We’ve always warned the public, especially those who live in hilly areas, to leave their houses during heavy rain, but they’ve always ignored it,” Alfian said. The local administration, Alfian added, had tried to relocate the people who lived in landslide-prone areas, but some of them had decided to remain. (dpk)Topics :last_img read more

Anies slams red tape in pandemic fight

first_imgThe request would then be discussed by an expert team appointed by the health minister, which would approve or deny the request in consultation with COVID-19 fast response team chief Doni Monardo, who also heads the National Disaster Mitigation Agency (BNPB). Other than regional leaders, the COVID-19 fast response team chief can also submit such a request.The Health Ministry must make a decision within two days after the submission of the request, the regulation says. The PSBB should then be implemented for 14 days, which can be extended if there are still proven cases of transmission. The PSBB covers the closing down of schools and offices, limitations of religious activities, activities in public places, social and cultural events, transportation restrictions and activities related to security and defense.Anies said he had sent a PSBB request to Health Minister Terawan Agus Putranto on Wednesday before the ministerial regulation was issued and would wait for an answer instead of sending a new letter. The request was being discussed by the Health Ministry’s team on Sunday afternoon.How Anies held back in coronavirus response (JP/Hengky)According to the government’s official count, there are 2,273 confirmed COVID-19 cases nationwide as of Sunday, including 1,124 in Jakarta. Ninety-five of the country’s 198 fatalities were recorded in Jakarta.Padjadjaran University epidemiologist Panji Hadisoemarto said the procedure to obtain the PSBB status was “overly bureaucratic”. He feared local administrations would be late in taking necessary measures, as they failed to immediately meet the requirements imposed by the regulation.“The criteria imposed are too restrictive, especially by referring to cases as those confirmed through PCR testing. In practice, it’s very likely that decisions will be made too late, because there’s a bottleneck in our PCR testing,” Panji said.Indonesia has conducted fewer than 10,000 tests using the PCR method so far, a small number that has been attributed to insufficient preparedness on the part of laboratories and a shortage of PCR testing kits. This has caused a backlog in testing, with many patients having to wait for days for their lab results to come back.Read also: Indonesia to receive 50,000 COVID-19 PCR test kits from South KoreaBerry Juliandi of the Indonesian Young Scientists Forum criticized the new regulation that gives the Health Ministry the authority over PSBB policies. “We’ve seen that the health minister has not taken the right measures to contain and mitigate COVID-19 so far,” Berry said.Bayu Dwi Anggono, a legal expert at the University of Jember in East Java, said requiring mayors and regents to consult with governors and also send their request to the latter instead of only to the Health Ministry would only increase paperwork, since the requirement was not stipulated in the 2018 Law on Health Quarantine nor in the 2020 government regulation.The Health Ministry did not immediately respond to the Post’s request for comment.Topics : Jakarta Governor Anies Baswedan has accused the central government of stonewalling his efforts to contain the spread of the coronavirus by issuing a ministerial regulation that prevents him from directly imposing stricter measures to limit people’s mobility.Under pressure to control rising case numbers and fatalities in the capital, Anies strongly criticized the Health Ministry’s new guidelines on large-scale social restrictions (PSBB) that include an assessment process and show “no sense of urgency”.“[It’s] as if we are proposing a project that needs a feasibility study,” Anies told The Jakarta Post on Sunday. “Can’t the ministry see that we are facing a rising death toll? Is that not enough?”Earlier this week, President Joko “Jokowi” Widodo said that, in lieu of a regional or national lockdown, regions could enforce physical distancing rules in their fight against COVID-19.According to Government Regulation No. 21/2020 on PSBB, provinces and cities are required to obtain a permit from the Health Ministry to impose the policy. As of Sunday, no region has obtained such a permit.According to a ministerial regulation issued by the Health Ministry on Friday, regional heads who want to enact PSBB have to submit requests alongside data on the increase of cases by also providing an epidemiology curve and a map on the spread of the virus as well as data proving that transmission had already occurred in their region. Cases in question refer to the number of patients under surveillance (PDP) and those having been confirmed through polymerase chain reaction (PCR) testing.Read also: Jakarta, West Java governors doubt central govt COVID-19 figureslast_img read more

Kimia Farma to cut investment, costs, but expects higher revenue amid COVID-19

first_img“Back in 2017 to 2019, we were focused on investments for our new plant in Banjaran, West Java, as well as our other production facilities for raw materials in Jakarta and [for] syringes in Cikarang, West Java,” Verdi said during a hearing on Tuesday with House of Representatives Commission VI overseeing trade, industry and state-owned enterprises (SOEs).During the same three-year period, the publicly listed company also expanded its business by opening more retail pharmacies, clinics and diagnostic laboratories in the country, as well as by developing health and beauty products. It also acquired Saudi Arabia’s Dawaa Medical Limited Company to establish retail pharmacies abroad.Verdi said that Kimia Firma also planned to reduce its business loans this year, from Rp 8.27 trillion in 2019 to just Rp 7.43 trillion, but did not elaborate on how it would achieve this.“We are also slashing our operating expense budget to Rp 3.5 trillion this year, Rp 280 billion lower than Rp 3.76 trillion previously,” he said. State-owned pharmaceutical company PT Kimia Farma plans to cut capital allocation and costs to maintain its performance during the COVID-19 pandemic, but still expects to see increased revenue this year.President director Verdi Budidarmo said on Tuesday that the company was lowering its capital allocation for the year to Rp 1.44 trillion (US$92.38 million), almost 38 percent lower than last year’s allocation of Rp 1.98 trillion.The company’s capital allocation totaled Rp 4.67 trillion in 2017-2019, when it completed most of its investments. Despite the tougher challenges this year, Verdi expressed confidence during the hearing that the company would earn 25 percent more revenue this year through its continuing support for the Health Ministry, the Disaster Mitigation Agency (BNPB) and other relevant state institutions in the nation’s fight against COVID-19.“With our support in providing medicines, medical equipment and services in managing the COVID-19 pandemic, we believe that we can achieve our revenue target of Rp 11.7 trillion this year,” he said.Last year, Kimia Farma made  Rp 9.4 trillion in revenue, up 11.13 percent compared to its revenue in 2018.The company’s shares have increased 2.4 percent since January, and increased 6.22 percent on Wednesday morning to Rp 1,280 per share.Topics :last_img read more

Virus lockdowns stifle Eid celebrations as infections rise

first_imgMuslims around the world began marking a sombre Eid al-Fitr Sunday, many under coronavirus lockdown, but lax restrictions offered respite to worshippers in some countries despite fears of skyrocketing infections.The three-day festival, which marks the end of the holy month of Ramadan, is traditionally celebrated with mosque prayers, family feasts and shopping for new clothes, gifts and sweet treats.But this year, the celebration is overshadowed by the fast-spreading coronavirus, with many countries tightening lockdown restrictions after a partial easing during Ramadan led to a sharp spike in infections. Further dampening the festive spirit, many countries — from Saudi Arabia to Egypt, Turkey and Syria — have banned mass prayer gatherings to limit the spread of the disease.Saudi Arabia, home to Islam’s holiest sites, began a five-day round-the-clock curfew from Saturday after infections more than quadrupled since the start of Ramadan to over 72,000 — the highest in the Gulf.Mecca’s Grand Mosque has been almost devoid of worshippers since March, with a stunning emptiness enveloping the sacred Kaaba — the large cube-shaped structure towards which Muslims around the world pray.But on Sunday, an imam stood on a podium while Saudi security forces, some wearing masks, positioned themselves between rows of worshippers who gathered before the Kaaba for Eid prayers. Scuffles in Jerusalem At Jerusalem’s Al-Aqsa mosque, Islam’s third-holiest site after Mecca and Medina, prayers were not permitted inside, although the site is expected to reopen after the Eid holiday. Small scuffles broke out between Israeli security forces and worshippers gathering around the mosque at dawn, although prayers eventually went ahead outside, an AFP photographer said. 🛑#Israel just can’t let #palestinian Muslims or Christians celebrate Hollidays in peace, During jewish holidays #palestinians are often put under a Curfew so jews can celebrateEid al-Fitr in Jerusalem | Several arrested during tensions outside Al-A-Aqsa Mosque— marshall (@Marshall_H15) May 24, 2020In Gaza, Hamas authorities allowed prayers in mosques despite the enclave’s first coronavirus death on Saturday, but worshippers mostly wore masks and placed their prayer mats far apart.”Eid is not Eid with the atmosphere of coronavirus — people feel a sense of fear,” worshipper Akram Taher said.In Afghanistan, the Taliban announced a three-day ceasefire to mark Eid al-Fitr in a surprise move following months of bloody fighting with Afghan forces after the signing of a landmark agreement with the United States. The streets of Kabul were mostly empty as part of a strict lockdown, but some people did venture out and greet each other — some from a distance and others hugging and shaking hands despite calls for social distancing.In Somalia, at least five people were killed and more than 20 wounded in a blast during Eid festivities, police said.The blast occurred as a crowd of people were dancing and singing, a witness said, but the cause of the explosion was unclear.In Indian-administered Kashmir, another troublespot, Eid celebrations were muted under the coronavirus restrictions and as authorities tightened the screws after a spate of clashes between government forces and rebels.Fears of ‘new peak’ Ahead of the holiday, Muslims across Asia — from Indonesia to Pakistan, Malaysia and Afghanistan — had thronged markets to shop, flouting coronavirus guidelines and sometimes even police attempts to disperse large crowds.”For over two months my children were homebound,” said mother of four Ishrat Jahan at a bustling market in the Pakistani city of Rawalpindi.”This feast is for the kids, and if they can’t celebrate it with new garments, there is no point in us working so hard throughout the year.”The holiday began on a sombre note after a Pakistan International Airline flight crashed Friday in the southern city of Karachi, killing 97 people including many who were travelling to see family for the holiday. The English daily Dawn said the crash, along with the pandemic, had robbed Pakistan of “whatever little joy had been left at the prospect of Eid festivities”.In Indonesia — the world’s most populous Muslim nation — people turned to smugglers and fake travel documents to get around bans on the annual end-of-Ramadan travel that could send infections soaring. In the conservative province of Aceh, large groups prayed together with few masks and little social distancing as Eid began, and the Baiturrahman Grand Mosque in the provincial capital was packed.”I did feel worried but as a Muslim, I still had to perform mass Eid prayers as a form of gratitude to Allah,” one worshipper, Arsi, said.Masjid Raya Baiturrahman. Banda Aceh ❤____@Aceh@iloveaceh#IdulFitri1441H #EidMubarak— Rahmad Saiful Hasan (@rahmadsaifulhs) May 24, 2020COVID-19 death tolls across the Middle East and Asia have been lower than in Europe and the United States, but numbers are rising steadily, sparking fears the virus may overwhelm often underfunded healthcare systems.Frugal celebrations Iran, which has experienced the Middle East’s deadliest outbreak, called on its citizens to avoid travel during Eid as it battles to control the virus.Health Minister Saeed Namaki said Iran was focusing hard on avoiding “new peaks of the disease” caused by people “not respecting health regulations”.The United Arab Emirates has tightened its lockdown which had been relaxed during Ramadan, but that did not stop some families from planning getaways to luxury beachfront hotels.But in many countries, Muslims steeled themselves for frugal celebrations amid growing financial distress, including falling oil prices that plunged the Gulf region into its worst economic crisis in decades.In the Syrian capital Damascus, Eid shoppers rummaged through flea markets for clothes at bargain prices as the war-ravaged and sanctions-hit country grappled with a much more entrenched economic crisis.”The flea market is the only place I can buy something new to wear for the Eid holidays,” 28-year-old Sham Alloush said.”Had it not been for this place, I wouldn’t have been able to buy new clothes at all.”center_img Topics :last_img read more

Britain bans China’s Huawei, handing US big win

first_imgThe politically-fraught change in Britain’s digital future was made by Prime Minister Boris Johnson during a meeting with his cabinet and National Security Council.It requires companies to stop buying new 5G equipment from Huawei starting next year and strip out existing gear by the end of 2027.”This has not been an easy decision, but it is the right one for the UK telecoms networks, for our national security and our economy,” digital minister Oliver Dowden told parliament. Britain on Tuesday bowed to growing US pressure and ordered the phased removal of Chinese telecoms giant Huawei from its 5G network despite warnings of retaliation from Beijing.The policy reversal hands a long-sought victory to US President Donald Trump’s administration in its geopolitical tug-of-war with China.The White House said the decision “reflects a growing international consensus that Huawei and other untrusted vendors pose a threat to national security, as they remain beholden to the Chinese Communist Party”. Diversification Johnson has challenged the Trump administration to come up with a reliable and cost-effective alternative to the Chinese firm.Britain is pushing for the creation of a 5G club of nations that can pool their resources and provide individual components for an alternative solution that could be applied across the world.The UK government said the process would begin with South Korea’s Samsung and Japan’s NEC — two veterans with broad production capabilities — while offering protection for Finland’s Nokia and Sweden’s Ericsson to ensure they remained viable players in the field.Ericsson’s regional head Arun Bansal said his firm was “ready to work with the UK operators to meet their timetable, with no disruption to customers”.Nokia’s chief executive for UK and Ireland, Cormac Whelan, said the firm also has “the capacity and expertise to replace all of the Huawei equipment in the UK’s networks at scale and speed”.But UK officials caution that all existing players have some Huawei equipment in their supply chains that needs to be taken into account. Topics : But the move threatens to further damage Britain’s ties with the Asian power and carry a big cost for UK mobile providers that have relied on Huawei equipment for nearly 20 years.Huawei called it “politicized” and likely to put Britain “in the digital slow lane”.China’s ambassador in London, Liu Xiaoming, called it a “disappointing and wrong decision”.”It has become questionable whether the UK can provide an open, fair and non-discriminatory business environment for companies from other countries,” he wrote on Twitter.  ‘Outages’ Johnson had come under intensifying pressure to not only dump Huawei but also adopt a tough line with China for its treatment of Hong Kong and repression of ethnic Uighurs in the western Xinjiang region.But he also pledged to voters last year to bring broadband access to all Britons by 2025.British telecoms companies had lobbied strongly against the policy reversal because of the cost of taking existing equipment out and finding untested alternatives.Dowden conceded Britons will now have to wait longer to get full access to the rapid new network.”This means a cumulative delay to 5G roll-out of two to three years and costs of up to £2 billion [$2.5 billion, 2.2 billion euros],” he said. “This will have real consequences for the connections on which all our constituents rely.”But officials insisted that Huawei had managed to install only a “small amount” of equipment since the 5G system began being offered to UK consumers last year. US sanctions Johnson infuriated Trump and upset some members of his own Conservative party by allowing the Chinese leader in global 5G technology to help roll out Britain’s speedy new data network in January.The UK was then completing its tortuous departure from the European Union and looking to establish strong ties with powerful Asian economies that could fulfill Johnson’s vision of a “Global Britain”.But the Trump administration told the UK government that its choice imperiled intelligence sharing because British signals could be intercepted or manipulated by China.Washington believes the private company can also shut down rival countries’ 5G networks under Beijing’s orders in times of war.Huawei has always denied this and pointed to two decades of cooperation with British security agencies that checked on the safety of its existing 3G and 4G networks.The British review was triggered by Washington sanctions in May that blocked Huawei’s access to US chips at the heart of 5G networks.The sanctions did not impact older 3G and 4G providers and Britain left its guidance for those networks unchanged.last_img read more

English lockdown might have reduced COVID-19 infections more than thought: Scientists

first_imgThe reproductive number of COVID-19 in England may been lower than previously thought in May, research published by British scientists said on Wednesday, suggesting the government’s COVID-19 lockdown worked to reduce infection rates.British Prime Minister Boris Johnson first eased England’s lockdown on June 1, and has since re-opened more of the economy.The research showed the rates of infection fell during May, the last month of full lockdown, halving every eight to nine days. The research also found that young adults were more likely to test positive than other age groups, indicating the need for them to follow social distancing even if their symptoms are often less severe than for older people.It also said that people of Asian ethnicity were more likely to test positive, which might account for higher death rates in that group.A separate pre-print study of a pilot test-and-trace scheme on the Isle of Wight found that it had reduced total incidence of infections and the R number faster than in other areas of the UK. Topics :center_img The study – which is a “pre-print”, meaning it has yet to be peer-reviewed – found there were on average 13 positive cases for every 10,000 people, with an overall reproduction number of 0.57.That is lower than the government’s official figures for that time, estimating a so-called “R” number of 0.7-0.9 when lockdown was eased. An R number of less than 1 indicates an epidemic is shrinking.”Our level of adherence in the UK, and the overall average behavior was very effective at reducing transmission of the virus,” Steven Riley, Professor of Infectious Disease Dynamics, Imperial College London, told reporters.Over 120,000 volunteers were tested as part of the study, which health minister Matt Hancock said showed the government took the “right actions at the right time”.last_img read more

As Canada nears zero COVID-19 deaths, officials fear reopening spike, US risk

first_imgCanadian deaths edged up eight to 8,798 according to government data late Tuesday, while the total number of cases grew by 331, to 108,486. By contrast, the United States recently set a one-day record in new cases with 60,500 as the national death toll rose to more than 135,000.But health experts and politicians fret the sacrifices Canadians made could be imperiled as the economy moves to a full reopening including schools, especially in heavily populated central Canada, and as US authorities struggle to contain the spread south of the border.”Everyone is preparing for a potential spike in cases … I think that’s inevitable,” said Dr. Isaac Bogoch, an infectious disease specialist at Toronto General Hospital.”Opening up the economy is not a linear path. There will be setbacks (and) we will very likely have to reimpose public health restrictions in certain areas because of an unacceptable number of new cases.” Canada’s efforts to flatten the curve of coronavirus cases have put the country on the cusp of zero deaths from COVID-19 for the first time since March, but officials see worrying signs of a new spike as provinces lift restrictions.For months, Canadians followed strict public health rules on social movement as the 10 provinces quickly shut down large parts of the economy, ramped up testing and boosted space in intensive care units.Some provinces curbed internal journeys while Ottawa barred international visitors, closed the land border to non-essential travel with the United States, which has become a global pandemic epicenter, and deployed military staff to hard-hit nursing homes. Quebec’s coronavirus cases are starting to rise and public health officials have tracked outbreaks to house parties and a suburban Montreal bar. In Ontario, an outbreak at a nail salon forced hundreds into quarantine while British Columbia, which has reported few new deaths in recent weeks, is seeing an uptick in cases as people expand their social circles.”We did so much work to keep the number of cases down,” said Alex Magdzinski, a Montreal nurse who treated COVID patients at a nursing home. “All healthcare workers are asking (people) is to put in a minimal effort.”Magdzinski said he is seeing repeated cases of people in Canada’s second largest city abandoning social distancing measures.Quebec has made wearing masks mandatory in indoor public spaces while other Canadian cities have enacted similar bylaws.”We need only look south of the border to see how bad things could be,” said Alberta Premier Jason Kenney on Monday, as he urged residents to “remain vigilant and disciplined” after large crowds gathered in parks and at a popular lake over the weekend.Canadian provinces, most of them with right-leaning governments that normally oppose Liberal Prime Minister Justin Trudeau, have been working closely with Ottawa, in a coordinated approach to the outbreak.In the US, the response has been politicized with Republican President US Donald Trump attacking opponents at the state and city level. Critics also complained the White House did a poor job of helping distribute crucial equipment.”They’ve been reckless. They moved forward too quickly,” Ontario Premier Doug Ford told reporters on Tuesday as the province gears up for its third and final stage of reopening .The two nations have banned non-essential land travel since mid-March but pressure is building on Trudeau from Canadian business leaders and US lawmakers to loosen restrictions. Polls show a large majority of Canadians, and provincial leaders, want the border to remain closed.This month, at least five incoming flights from cities in Florida, Texas and North Carolina had passengers with confirmed coronavirus cases aboard, according to Canadian government data.”Don’t get me wrong,” said Ford. “I love the Americans. I don’t want them up here right now.” Topics :last_img read more

Winners and losers in EU’s big stimulus deal

first_imgAfter four days of squabbling there is a little something for everyone in the 750-billion-euro recovery package agreed by EU leaders — but the details reveal real winners and losers. WinnersMore ‘Europe’: It is very hard to deny that the painstakingly negotiated deal is a victory for backers of a more centrally-run or federal Europe, most notably French President Emmanuel Macron. Calls from Rome and Italy for “solidarity” quickly followed, but northern Europe firmly quashed any talks of joint borrowing or anything that reeked of sending tax revenue from one EU country to the other.But no one had counted on a sea change in Germany, where Chancellor Angela Merkel allied herself with Macron to back 500 billion euros in joint borrowing to help the hardest-hit by the pandemic.  Now, tens of billions will be heading out — despite the furious pushback by the “Frugals”, the Netherlands, Sweden, Denmark and Austria — that said they would refuse any penny in direct aid to their partners.In the end, after the fighting, a total of 390 billion euros will be distributed in direct aid. The climate cause: About one third of the EU’s stimulus stash will be earmarked for fighting climate change, making it one of the biggest green deals anywhere in history.National governments will be asked to submit climate-friendly projects involving electric cars, energy efficiency, and renewable power.Brussels: Another winner will be the European Commission, the bloc’s executive arm, which will be in charge of deciding how the money will be disbursed.The level of involvement of the EU in the oversight of national spending will be unprecedented, with the exception of bailouts of Greece, Portugal or Ireland during the debt crisis. LosersEU budget: The largesse of the recovery fund is coming in part by starving the normal EU budget that was also negotiated at this weekend’s marathon summit.Some call it robbing Peter to pay Paul: research, a transition fund for climate change and an EU investment fund have all been gutted of original proposals.The EU’s landmark Erasmus program for young people is also stripped, drawing a furious response from the European Parliament, which will have to ratify the plan this year.Much of this is to pay for the recovery fund as well as fork out tens of billions of euros in rebates to the frugals, who were finally quieted with substantial returns in cash on their EU contributions.Digital tax: The EU’s proposal to leaders had included an unprecedented ambition to raise EU taxes through various means: including a special tax on tech giants or a carbon tax. In the end, none of these was finalized and the recovery fund will need to be repaid by the EU budget over decades to come.To be determinedOrban: An hour before the final deal was announced, media close to Hungarian Prime minister Viktor Orban said the EU had abandoned all plans to link EU disbursements to adherence to European rules on media freedom and the independence of the judiciary.EU negotiators however insist this is not the case and that Brussels will submit a plan to make the link explicit. Only time will tell whether Brussels is able to bring their plan to fruition.”Whether or not the mechanism will bite will depend on its design — and all countries will still have to agree to it,” warned Lucas Guttenberg of the Jacques Delors Center in Berlin.Topics : In 2017, the leader eschewed “La Marseillaise” and marched solemnly to his inaugural address to the air of the EU anthem “Ode of Joy”.A speech at la Sorbonne University quickly followed that unfurled a hugely ambitious vision for Europe, with myriad proposals for deepening the EU project that most saw as far-fetched.The Netherlands and other countries that would prefer a “small” Europe successfully stonewalled Macron’s desire, until the virus crisis forced them to accept joint borrowing to finance the rescue package.Spain and Italy: The first tragic scenes of pandemic in Europe came from Italy and Spain, with hospitals overrun and death rates skyrocketing.last_img read more