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Meloni, an Italian company, has secured a pledge of investment worth 40 billion dollars from the UAE.
At a Rome bilateral summit, the United Arab Emirates announced that it plans to invest 40 billion dollars in Italy. The two countries did not give a timeframe. Since taking office as Italian Prime Minister in 2022 Giorgia Mello has sought to strengthen ties with Gulf nations, ignoring the concerns raised by political rivals over human rights. Italy under her leadership lifted the arms embargoes imposed on the UAE and Saudi Arabia by previous governments in connection with the Yemen war. Meloni received Sheikh Mohammed bin Zayed Al Nahya, President of the UAE, on Monday during his state visit to Rome. The pair also pledged to continue working towards a “Comprehensive Strategic Partnership." In a joint press release, the two governments stated that "the UAE has committed $40 billion in investment in Italy in key sectors". The report added that "over 40 new agreements have been signed" in areas such as economic cooperation, investment, defence, nuclear, and space affairs. The names of the companies were not disclosed. Eni, the Italian energy giant, announced separately that it had signed a separate letter of intent with UAE-based companies MGX G42 for the development of data centres in Italy powered by natural gas plants using carbon capture technology. Eni has also signed an agreement with Masdar, the state-controlled renewables energy company in the UAE. Taqa Transmission will give Eni the status of preferred off-taker of renewable energy produced by Albania as part of a Italo-UAE and Albanian deal announced in January. Eni also signed a Memorandum of Understanding with Abu Dhabi’s sovereign wealth fund ADQ for cooperation on the critical mineral supply chain. Meloni said at the Italy-United Arab Emirates Business Forum held in Rome that "it is a historical day, another landmark in our relationship." She added, "We chose to focus our partnership on strategic axes such as artificial intelligence (AI), data centres, research in space, renewable energy, and rare earths." The joint statement emphasized enhanced military and safety cooperation through "joint manufacturing, technology transfer and the development defense manufacturing facilities." The report also called for a closer collaboration with international partners, such as the United States, on the issue of ransomware and joint cybersecurity exercises. Meloni announced a strategic partnership strengthened with Saudi Arabia last month. The deal was accompanied by a series of business deals valued at around $10 billion. (Reporting and editing by Gavin Jones, Christina Fincher and Alvise Armellini)
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Rusal, a Russian company, cancels bond placings following EU sanctions
Market sources reported that Rusal, the Russian aluminium manufacturer, cancelled on Monday a placement of Yuan and Rouble bonds after the EU banned imports of primary aluminium from Russia in a new package of sanctions. The European Council included an aluminium ban as part of its 16th package of sanctions against Russia, but also introduced a quota to facilitate the transition. This quota is 275,000 tons per year for aluminum imports from Russia. In 2024, the EU imported approximately 344,000 tons (or aluminimum) from Russia. In 2024, the EU Commission reported that Russian aluminium only accounted for 6% of all metal imports, down from 16% in 2010. Rusal, a Hong Kong-listed company, planned to offer investors bonds in the amount of 500 million yuan ($68.97million) with settlements made in roubles as well as 10 billions roubles (113.74million) in roubles. Rusal declined to comment. It is the largest aluminum producer in the world outside of China. Rusal, a company that is not directly sanctioned by the West, has sought to diversify its sales to Asian markets. Rusal saw its share of revenues from Europe fall to 22% in the first half 2024. This is down from 31%. The 16th package is likely to have a significant impact on the finances of the company, according to Renaissance Capital debt analyst Vladimir Vasilenko. Bonds offer Russian companies more attractive rates of interest than bank loans. Bank loans have become unaffordable after the central banks raised its key rate to 21% in 2011.
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Rheinmetall converts German factories for defence equipment
Rheinmetall, Europe’s leading ammunition manufacturer, plans to convert two of its German automotive plants to make primarily defence equipment. This will highlight the impact of a surge in expected spending in the area amid U.S. concerns over the Ukraine War. Last week, the EU's political leaders were gathered at the Munich Security Conference to discuss their own defence strategy. The defence expansion of Rheinmetall affects its Berlin and Neuss factories, where it currently manufactures automotive parts. This business has been challenged as German carmakers struggle with high costs and foreign competition. According to the plans that are still being finalised, both plants would become part Rheinmetall's Weapon and Ammunition division and function as hybrid plants. This will ensure some automotive production is still possible. The group said in an emailed statement that "above all, these plants will benefit from industrial strength of the Rheinmetall Group as a major supplier of military equipment, as well as the high demand by customers in Germany and around the world." The company stated that no final decisions have been made about the new structure. The company also stated that no explosives will be processed on the sites, but they will produce mechanical and protection components for military purposes. After U.S. president Donald Trump stated that Europe must increase its investment in military resources, shares of European weapons makers have soared on the expectation of a spending boom. Last week, the STOXX Aerospace and Defence Index hit new highs as investors bet that the governments of the region will need to spend more money on military equipment and weapons as the U.S. is preparing to pull back. It could also boost German manufacturing at a moment when traditionally strong sectors are cutting thousands of jobs and capacity, including automakers like Volkswagen. Germany's weak economy was the main complaint of voters during weekend elections. RETOOLING Rheinmetall is the second defence company to announce plans for converting existing manufacturing capacity in a month. The first was defence group KNDS, which agreed to buy a plant from French trainmaker Alstom. KNDS is a 50-50 joint venture between Wegmann & Co GmbH in Germany and the French government. The site will be used to manufacture military equipment, such as the LEOPARD II battle tank and PUMA infantry combat vehicle. Since the Russian invasion of Ukraine, Rheinmetall's value has increased. The company was promoted to the blue-chip DAX 30, Germany's stock market, two years ago. It is now valued at about 39 billion euro ($40.8 billion), based LSEG data. This value was almost doubled before Trump won. DEFENCE SPENDING The defence budget needs to be increased as only 23 out of the 32 NATO member countries reached their 2% national production target last year. Analysts at Deutsche Bank stated that it is easy to understand why additional spending of hundreds of billions may be needed over the remainder of this decade. The economists at Deutsche Bank calculated that it would cost around 800 billion euros to correct 10 years of underspending among NATO members in order to achieve the 2% target. Trump has asked NATO members to raise their spending to 5% GDP. Deutsche Bank analysts said that only 40 billion euro of the 200 billion euros Europe will spend on defense equipment by 2022 went to EU providers. Investors are also more interested in defence-related assets. Thyssenkrupp is preparing a spinoff of its Warship Division TKMS while KNDS will explore a stock exchange listing by the end of 2025. "We're well prepared, and we don’t need to be timid - action is needed now for the security of Europe," Rheinmetall CEO Armin Pappger said earlier this month. He added that the company expects to grow faster than originally thought. In the first nine-month period of 2024, Rheinmetall's profit from its weapons and ammunition division nearly doubled, reaching 339 million euro, while its profits in its automotive division dropped 3.8%, to 74 millions euros, as it announced in November. Hensoldt, Renk and other Rheinmetall rivals could also benefit from the expected increase in defense spending. (1 euro = 0.9558 dollars) Reporting by Christoph Steitz, Matthias Inverardi and Josephine Mason; editing by Jane Merriman, Rachel More and Josephine Mason
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Copper prices fall on Chinese inventories and tariff threats
Copper prices fell on Monday, as traders focused their attention on U.S. president Donald Trump's threats to impose tariffs and the changing demand signals coming from China, the top copper consumer. By 1236 GMT, the benchmark copper price on London Metal Exchange (LME), was down by 0.5% to $9,507 per metric tonne. It was up 8% from the beginning of the month, on the hope of a stronger demand in China following the Lunar New Year holidays. Trump plans to impose tariffs to encourage producers to manufacture aluminum and copper in the United States. "Tariffs are a drag on growth and demand," said Bank of America's Michael Widmer. "The last time Trump imposed tariffs, in 2018, many investors concluded that shorting metals was an attractive trade." The Shanghai Futures Exchange (ShFE), which monitors copper stocks, has also been monitoring the stockpiles of this metal in warehouses. The total amount of coal produced in the first half of this year has risen to over 260,000 tonnes, up from about 83,000 tons. Shanghai's bond warehouses Since mid-January, the copper inventory has more than doubled. The International Copper Study Group's (ICSG) data also weighed on the copper market. It showed that the market had a surplus of 301,000 tons last year, compared to a shortfall of 52,000 tons in 2023. Copper stocks in LME approved warehouses are up 12% since February 12 to 267,225 tonnes. The LME's cancellations (metal earmarked for shipment) of 84,400 tonnes suggest that a large amount of copper is likely to be shipped out in the coming days and even weeks. Many traders expect that much of the copper will end up in COMEX storage facilities in the United States. Prices have surged compared to the LME due to fears over tariffs on imports of copper. Other metals saw a 1.2% decline in aluminium at $2655 per ton. Zinc fell by 1.8% to 2,876, while lead dropped 0.2% to $2,000, and tin declined 0.3% to $33,575; nickel rose 0.2% to $15,550.
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Sasol leaves coal export market and focuses on improving quality
Executives from the South African petrochemical company Sasol announced on Monday that it is leaving the coal export market and starting a de-stoning program to improve the quality of the feedstock for its synthetic fuels and chemicals business. Sasol manufactures fuel and chemicals using coal and gas and exports about 2 million tonnes of fossil fuel each year. The quality of coal used in Sasol's Secunda operation has been low for many years due to the high content of stones. The company has been producing lower volumes of chemicals and fuels, consistently underperforming its historical output levels. Simon Baloyi, CEO of the company, said that it is redesigning its coal export plant to reduce stone content in order to solve the problem. Baloyi stated that the quality of coal produced by its mines was "no longer export quality", adding that the project to de-stone the coal would restore fuel production and chemical production at historical levels. Walt Bruns, Sasol's Finance Director, said in an interview that they make more money by beneficiating the coal and turning it into fuels and chemicals rather than selling it for export. Bruns said that Sasol will lease out its coal export quotas at the Richards Bay Coal Terminal, to other miners. Sasol announced earlier on Monday that its headline earnings per share had fallen by 31% to 14,13 rand ($0.7712) for the six-month period ending December 2024 from 20,37 rand previously, due to a decline in oil prices as well as lower sales volumes. The company did not declare dividends because its negative free cash flow was 1.1 billion rands, and its net debt was $4.3 billions. This exceeded the levels of its capital allocation policy.
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Platts says that the Brent crude oil benchmark is working as expected and no changes are planned.
S&P Global Commodity Insights (Platts), a commodities reporting agency that provides information on commodity prices, stated Monday that the dated Brent crude oil market is working well since U.S. WTI was added to it. Further changes are not expected, Platts said. The first year that WTI Midland was included in the Brent benchmark date after its inclusion in the basket began in May 2023 due to falling North Sea production, was also the first year in which it was the first crude oil grade outside of the North Sea. Platts announced on Monday that Brent oil 2024 is a smooth ride for the benchmark dated after record trading volumes were recorded in the final months of the year. Platts has not announced any changes to the benchmark for the event. This year, we do not have any major initiatives to share about dated Brent. Richard Swann said that the past year was one of remarkably smooth operation. He spoke at Platts’ event in London as part of International Energy Week. This is a market that's working well. The different components are seeing a lot more liquidity and they all contribute to the ecosystem around Brent. Platts reported that a volume record of 39,7 million barrels was achieved for its North Sea crude oil physical cargoes in December. This includes contract for difference and cash BFOE fractions.
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Iraq announces it will update its Overproduction Compensation Plan
Iraq reaffirmed Monday its commitment to the OPEC+ Agreement and said that it would present an update plan to compensate any overproduction from previous periods. Baghdad said that its oil minister Hayan Abdul-Ghani spoke with Saudi Arabian Energy Minister Prince Abdulaziz bin Salman and OPEC Secretary-General Haitham Al-Ghais. Iraq has said that it will continue to make efforts to compensate for the overproduction, while also taking into consideration the expected handover of oil from the Kurdistan Regional Government. OPEC+, a grouping of members of the Organization of Petroleum Exporting Countries (OPEC) and their allies, such as Russia is scheduled to increase its supply in April. OPEC+ has agreed to reduce its output by 5,85 million barrels a day (bpd), which is about 5.7%, in a series steps that have been taken since 2022. The group has extended its most recent layer of cuts until the first quarter 2025. This is the latest delay due to weak demand, and increased supply outside of the group. Baghdad awaits the approval of Turkey to resume oil flow from the Iraqi Kurdistan Region after a two year halt that began in March 2022, when the International Chamber of Commerce ordered Ankara pay Baghdad damages of $1.5 billion for unauthorised exports in the period between 2014 and 2018. Sources have confirmed that the Trump administration has put pressure on Iraqi officials to allow Kurdish exports of oil to resume or else face sanctions along with Iran. Later, an Iraqi official denied the pressure and threat of sanctions. A senior Iraqi official in the oil ministry told reporters earlier that around 185,000 barrels of oil per day will be exported through the Iraq-Turkey oil pipeline from Kurdistan once oil shipments resume. Iraq and Kazakhstan both promised compensation cuts in order to compensate for overproduction. Reporting from Jana Choukeir, Baghdad; Ahmed Rasheed, Dubai; writing by Mahal Dahan; editing by Kirby Donovan
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Bangladeshi migrants are at risk of abuse after being exiled from the Gulf due to climate change
Climate change forces families abroad to send relatives Migrants are at risk of sexual abuse, wage denial, and other forms of abuse. Experts call for better protection in host cities Tahmid Zami Tahmid Zami "Vulnerable individuals who are pushed to their limits by climate shocks make a big gamble in order to pay for migration but end up facing abuse," Ritu Bharadwaj said, one of the authors. The study of Bangladeshi migrants from climate-vulnerable regions who worked in the Gulf revealed that almost all of them had experienced at least one form exploitation, whether it was employer abuse, sexual assault or wage denial. The International Institute for Environment and Development says that migrants, who are mostly from Saudi Arabia, United Arab Emirates and Oman, become trapped in a "modern form of slavery" when they take out loans or sell land to cover the $4,021 required to find work abroad. The think tank in London spoke with 648 households about the impact of climate change on those living at the frontline. On the Move As the world has become warmer, migration has increased in the last two decades, depriving people of a stable life, future, or reliable income. In the study, it was found that households in disaster-prone areas were twice as likely to relocate within Bangladesh and 1.6 times more likely than those in less dangerous places to do so. In the last decade, 88% of families sent someone overseas. This is up from just 9% in 2001-2010 or 4% in 1990s. Bangladesh is the seventh most vulnerable nation to climate change. Disasters such as floods and cyclones are increasing in frequency. Climate-related disasters cost the economy four times more than they did in 1960-1990. They now amount to $558 millions annually. The study found that this cost each family living in the disaster-prone coastal region more than $870 per year. This leaves families with less money for necessities of life like food, health, and education. Farmers, fishermen and small business owners were among those most affected. Their livelihoods were often severely impacted, forcing them into seeking out new opportunities. Take Pirojpur, a district on the southern coast in Bangladesh that has been hit by cyclones and floods. Abu Musa, a teacher in Dhaka, said that he sent his brother there to work as a guard because the monsoon last year destroyed his family's crops and fishing. Many people who moved to other cities faced new problems and risks in their new homes, especially those who had relocated abroad. According to the study, migrants working in the garment and construction industries in large cities are denied compensation for workplace accidents while domestic workers face beatings or inadequate bedding and food. Bharadwaj said that migrants who move abroad face greater risks because they are forced to recover their high start-up costs. The study found that employers often confiscate workers' passports, barring them from leaving their workplace, denying the chance for them to contact family or the embassy. The survey revealed that women suffer the most. More than 80% of respondents reported abuse such as beatings or sexual harassment by their hosts. Where to turn? International Labour Organization (ILO) says that as the number of Bangladeshi migrants to Gulf countries reaches millions, embassies struggle to monitor the conditions or to mount rescues. The sad thing is that when workers are abused, they don't know who to turn to, said Mohammad Rashed Alam Bhuiyan. He is an assistant professor at Dhaka University, studying climate migrants from Bangladesh. He said that the government could outsource services such as shelter or health care to private organizations. Md Shamsuddoha of the Center for Participatory Research and Development in Dhaka, Bangladesh, stated that helping communities reduce climate-related losses could also help to reduce the risk of abuse overseas. He said that if families received early warnings about disasters and cash assistance, they might be better informed, and more likely to remain. Experts have also pointed out the complex web of brokers who help migrants find work from the Middle East up to Malaysia. Bharadwaj, from IIED, says that these middlemen are frequently accused of fraud and deceit. This highlights the need to track migrants better.
EU lifts sanctions on Syria, including those on banking and energy
The European Union has suspended sanctions against Syria, including those relating to energy, banking and transport, with immediate effect.
The EU has implemented a number of sanctions against individuals and sectors in Syria.
After the insurgents led by Hayat Tahrir Al-Sham (HTS), an islamist group, ousted Bashar al Assad from his position as president in December, European leaders began to rethink their approach.
On Monday, the EU Foreign Ministers met in Brussels and agreed to suspend sanctions against the oil, gas, and electricity sectors, as well as the transport sector.
The Syrian Central Bank has also been exempted from restrictions and asset freezes.
The EU maintained a number of other sanctions against the Assad government, including those related to arms trade, dual-use products with both civilian and military uses, surveillance software, and international trade in cultural heritage items from Syria.
They stated that they would monitor the situation in Syria and ensure the suspensions were appropriate. Reporting by Bart Meijer Editing Bernadettebaum and Aidan Lewis
(source: Reuters)