New York, May 23 (AP/UNB) — Saudi Arabia's state owned oil company will begin buying liquid natural gas from a U.S. company under a 20 year agreement, reflecting the shifting dynamics in the world's energy markets.
Saudi Arabian Oil Co., also known as Aramco, said Wednesday it would buy 5 million tons of liquid natural gas per year from Sempra Energy, based in San Diego. Aramco also will make a 25% equity investment in an LNG export facility under development in Port Arthur, Texas, as part of the deal.
The agreement is a major step forward in Aramco's long-term strategy to become a global LNG player, said Amin Nasser, the company's CEO. "With global demand for LNG expected to grow by around 4% per year ... we see significant opportunities in this market and we will continue to pursue strategic partnerships which enable us to meet rising global demand for LNG," Nasser said in a news release.
The U.S. fracking boom over the last decade led to an abundance of natural gas, and the U.S. quickly became one of the world's top exporters of liquid natural gas after it began exporting the fuel in 2016. Its exports of LNG ranked fourth largest in the world in 2018 behind Qatar, Australia and Malaysia, according to the U.S. Energy Information Administration.
The Port Arthur facility is one of Sempra's five LNG development opportunities in North America, and it received authorization from the Federal Energy Regulatory Commission to construct and operate the facility and related pipelines last month.
"At Sempra Energy, we are developing one of the largest LNG export infrastructure portfolios in North America, with an eye towards connecting millions of consumers to cleaner, more reliable energy sources," said Jeff Martin, CEO of Sempra, in a statement. Partnering with Aramco will help develop the facility and enable the export of American natural gas to global markets, Martin said.
The U.S. has been a net exporter of natural gas every month for the past year, fueled by an increase in exports of liquid natural gas. The largest markets for U.S. exports of liquid natural gas in 2018 were South Korea, Mexico and Japan, according to the E.I.A.
The liquid natural gas purchased by Saudi Aramco will most likely be sold on the spot market in Europe and Latin America, said Ira Joseph, head of gas and power analytics at S&P Global Platts.
"This is by far and away the Saudis' largest investment ever in LNG," Joseph said. "The size of the deal, the volume of the LNG, is very out of step with size of LNG contracts that have been signed recently."
Companies such as Sempra have been looking for investors for LNG projects, but finding buyers to sign long-term deals has been difficult. Liquid natural gas is mostly used for power generation, and renewable energy sources have made the market for fuels for power generation more competitive, Joseph said.
Saudi Arabia burns a lot of crude oil in its electric power sector, and the move could help the country diversify its power mix and potentially export crude oil that it might have burned, said Jonathan Aronson, research analyst at Cornerstone Macro.
"If they want to play in the global energy markets, this is a way to get a foothold on the natural gas side, and U.S. natural gas is some of the lowest-cost natural gas in the world," Aronson said.
Dhaka, May 22 (UNB) – German Ambassador to Bangladesh Peter Fahrenholtz on Wednesday said they will work closely to promote Bangladesh’s RMG industry to his government, buyers and other stakeholders.
The German envoy said this when he met president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Dr Rubana Huq at her residence.
Welcoming the new BGMEA Board of Directors, he highly appreciated its initiative to work out an understanding with ACCORD, said a BGMEA media release.
The diplomat said it is a fresh breath of air and they see the possibilities of transparent and accountable dialogue.
He affirmed to assist the industry on positive branding and suggested ways to reach out to international stakeholders.
Counsellor for Development Cooperation Andreas Hartmann was also present.
Dhaka, May 21 (UNB) - Industries Minister Nurul Majid Mahmud Humayun on Tuesday said the next Industrial Policy, to be formulated in 2021, will be a business-friendly and time-befitting one.
He said the government will finalise the new policy in consultation with all the stakeholders prioritising all the potential sectors.
The minister was addressing a seminar titled ‘Industrialization in Bangladesh: The Next Level’ at a city hotel.
Bangladesh-German Chamber of Commerce and Industry (BGCCI) organised the seminar. Chairman of the National Board of Revenue (NBR) Md Mosharraf Hussain Bhuiyan spoke as special guest at the event chaired by BGCCI President barrister Omar Sadat.
The minister said the current Industrial Policy is based on the Industrial Policy of 1972 and the government has taken an initiative to make it a time-befitting one.
The NBR Chairman said they would extend all required support to the Chamber to facilitate its operations and help boost the export and bilateral trade with European countries.
Bangladesh Investment Development Authority (BIDA) Executive Chairman Kazi M Aminul Islam, BGCCI Senior Vice President Golam Morshed, Vice President M Moin Uddin Mazumder were present. Incepta Pharmaceuticals Managing Director Abdul Muktadir, among others, spoke on the occasion.
Omar Sadat urged the Industries Minister to engage in conversation with all the chambers and business bodies to deliver a meaningful Industrial Policy.
Mentioning that countries like Japan, South Korea, Thailand, Singapore and Malaysia had been the growth miracle of East Asia over the years, Sadat said Bangladesh is also going on the right trajectory.
He said Germany has now become the largest bilateral development partner of Bangladesh surpassing the USA as the annual bilateral trade volume now has risen to $6.9 billion.
Sadat also suggested framing the Industrial Policy prioritising sectors like RMG, leather and leather products, ICT, and agro- processed foods.
Abdul Muktadir said Bangladesh is now at the crossroad of development.
Highlighting the bright prospects of the country’s pharmaceuticals sector, Muktadir said Bangladesh will be exporting medicines worth billions of dollars abroad, including half a billion dollar per year to Germany, within the next few years.
Dhaka, May 19 (UNB) - Citi has been named as the best bank in Asia by Corporate Treasurer Magazine, Asia’s leading trade magazine covering corporate treasury and finance.
The best bank award was decided by a poll of over 1,200 corporate treasurers and CFOs across the Asia Pacific region arranged by the magazine and East and Partners, global specialist business banking market research and analysis firm, said a media release on Sunday.
The poll asked companies for their primary bank and their satisfaction with it across transaction services, including cash, trade and FX services.
The winner was then determined by the combined scores of market share and this satisfaction rating.
“We were delighted with the level of engagement in this ground breaking original research by Corporate Treasurer and East. For Citi, the award was a significant milestone marking its journey in Asia,” said the editorial announcing the award.
“The award is important recognition from clients that Citi is delivering on our commitment to be their most trusted banking partner. We would like to thank all our clients for this trust they place in us. Underpinning this win is a team across the region and I would like to congratulate them,” said Jan Metzger, Asia Pacific Head of Banking, Capital Markets Advisory.
In the first quarter of 2019, Citi Asia Pacific reported a 60 percent rise in net income quarter on quarter across its Institutional Clients Group in Asia, which bank’s Asia’s leading corporates and global MNCs doing business in the region.
“The year is already off to a strong start. We’re seeing an increased demand for banking services as more of our global clients invest in opportunities across the region and we continue to support Asia’s local champions with their local, regional and global aspirations. Our regional network has never been stronger and this strength is helping us broaden and deepen banking relationships,” added Metzger.
Washington, May 18 (AP/UNB) — Bogged down in a sprawling trade dispute with U.S. rival China, President Donald Trump took steps Friday to ease tensions with America's allies — lifting import taxes on Canadian and Mexican steel and aluminum and delaying auto tariffs that would have hurt Japan and Europe.
By removing the metals tariffs on Canada and Mexico, Trump cleared a key roadblock to a North American trade pact his team negotiated last year. As part of Friday's arrangement, the Canadians and Mexicans agreed to scrap retaliatory tariffs they had imposed on U.S. goods.
"I'm pleased to announce that we've just reached an agreement with Canada and Mexico, and we'll be selling our product into those countries without the imposition of tariffs, or major tariffs," Trump said in a speech to the National Association of Realtors.
In a joint statement, the U.S. and Canada said they would work to prevent cheap imports of steel and aluminum from entering North America. The provision appeared to target China, which has long been accused of flooding world markets with subsidized metal, driving down world prices and hurting U.S. producers. The countries could also reimpose the tariffs if they faced a "surge" in steel or aluminum imports.
In Washington, some were urging Trump to take advantage of the truce with U.S. allies to get even tougher with China.
"China is our adversary," said Sen. Ben Sasse, R-Neb. "Canada and Mexico are our friends. The president is right to increase pressure on China for their espionage, their theft of intellectual property, and their hostility toward the rule of law. The president is also right to be deescalating tension with our North American allies."
Earlier Friday, the White House said Trump is delaying for six months any decision to slap tariffs on foreign cars, a move that would have hit Japan and the Europe especially hard.
Trump still is hoping to use the threat of auto tariffs to pressure Japan and the European Union into making concessions in ongoing trade talks. "If agreements are not reached within 180 days, the president will determine whether and what further action needs to be taken," White House press secretary Sarah Sanders said in a statement.
In imposing the metals tariffs and threatening the ones on autos, the president was relying on a rarely used weapon in the U.S. trade war arsenal — Section 232 of the Trade Expansion Act of 1962 — which lets the president impose tariffs on imports if the Commerce Department deems them a threat to national security.
But the steel and aluminum tariffs were also designed to coerce Canada and Mexico into agreeing to a rewrite of North American free trade pact. In fact, the Canadians and Mexicans did go along last year with a revamped regional trade deal that was to Trump's liking. But the administration had refused to lift the taxes on their metals coming into the United States until Friday.
The new trade deal — the U.S.-Mexico-Canada Agreement — needs approval from legislatures in the U.S., Canada and Mexico. Several key U.S. lawmakers were threatening to reject the pact unless the tariffs were removed. And Canada had suggested it wouldn't ratify any deal with tariffs still in place.
Thomas Donohue, president of the U.S. Chamber of Commerce, said the lifting of the tariffs "will bring immediate relief to American farmers and manufacturers. Critically, this action delivers a welcome burst of momentum for the USMCA in Congress."
Canadian Prime Minister Justin Trudeau credited his government for holding out to get the tariffs removed.
"We stayed strong," he said. "That's what workers asked for. These tariffs didn't make sense around national security. They were hurting Canadian consumers, Canadian workers and American consumers and American workers."
Trump had faced a Saturday deadline to decide what to do about the auto tariffs.
Taxing auto tariffs would mark a major escalation in Trump's aggressive trade policies and likely would meet resistance in Congress. The United States last year imported $192 billion worth of passenger vehicles and $159 billion in auto parts.
"I have serious questions about the legitimacy of using national security as a basis to impose tariffs on cars and car parts," Iowa Republican Sen. Chuck Grassley, chair of the Senate Finance Committee, said in a statement Friday. He's working on legislation to scale back the president's authority to impose national security tariffs under Section 232.
In a statement, the White House said that Commerce Secretary Wilbur Ross has determined that imported vehicles and parts are a threat to national security. Trump deferred action on tariffs for 180 days to give negotiators time to work out deals but threatened them if talks break down.
In justifying tariffs for national security reasons, Commerce found that the U.S. industrial base depends on technology developed by American-owned auto companies to maintain U.S. military superiority. Because of rising imports of autos and parts over the past 30 years, the market share of U.S.-owned automakers has fallen. That has caused a lag in research and development spending which is "weakening innovation and, accordingly, threatening to impair our national security," the statement said.
The market share of vehicles produced and sold in the U.S. by American-owned automakers, the statement said, has declined from 67% in 1985 to 22% in 2017.
But the statistics don't match market share figures from the industry. A message was left Friday seeking an explanation of how Commerce calculated the 22%.
In 2017, General Motors, Ford, Fiat Chrysler and Tesla combined had a 44.5% share of U.S. auto sales, according to Autodata Corp. Those figures include vehicles produced in other countries.
It's possible that the Commerce Department didn't include Fiat Chrysler, which is now legally headquartered in The Netherlands but has a huge research and development operation near Detroit. It had 12% of U.S. auto sales in 2017.
The Commerce figures also do not account for research by foreign automakers. Toyota, Hyundai-Kia, Subaru, Honda and others have significant research centers in the U.S.
Meanwhile, Trump is locked in a high stakes rumble with China. The U.S. accuses Beijing of stealing trade secrets and forcing American companies to hand over technology in a head-long push to challenge American technological dominance. The two countries have slapped tariffs on hundreds of billions of dollars in each other's products. Talks broke off last week with no resolution.
The hostilities between the world's two biggest economies have weighed heavily the past couple of weeks on the U.S. stock market, threatening a long rally that Trump touted as a vindication of his economic policies. Opening a new front in the trade wars against EU and Japan likely would have worried investors even more.