31-01-2019
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ECONOMY & BUSINESS<br />
BANGLADESHTODAY 10<br />
THE<br />
THUrSDAy, JANUAry <strong>31</strong>, 2<strong>01</strong>9<br />
Trust trumps money for<br />
Facebook with earnings due<br />
A 5 day long workshop on "Innovation in the citizen service" inaugurated in the head office of Karmasangsthan Bank on<br />
29.<strong>01</strong>.2<strong>01</strong>9. Managing director of the bank Md. Abul Hossain presided over the workshop. Additional Secretary & Chief<br />
Innovation Officer of Financial Institutions Division, Ministry of Finance Md. Nasir Uddin Ahmed was present in the<br />
meeting as chief guest. All general managers, principal and high officials of the bank were also present in the workshop.<br />
Photo: Courtesy<br />
Pound up after Brexit drop, eyes<br />
on Fed and trade talks<br />
London stocks rose and the pound<br />
rebounded slightly Wednesday after<br />
suffering heavy losses on worries about<br />
a possible no-deal Brexit, while Asian<br />
equities were mixed ahead of crunch<br />
trade talks between China and the<br />
United States.<br />
MPs on Tuesday returned to<br />
Westminster to vote on a series of<br />
proposals dealing with Britain's exit<br />
from the European Union after<br />
roundly rejecting Prime Minister<br />
Theresa May's controversial deal two<br />
weeks ago.<br />
In a closely watched series of votes,<br />
they rejected a plan to put back the<br />
date of leaving the EU if no new<br />
agreement is agreed by the end of next<br />
month. They then backed a proposal<br />
asking May to replace her deal's socalled<br />
backstop provision preventing a<br />
hard border with Ireland - a proposal<br />
immediately rejected by an EU<br />
spokesman.<br />
While observers still expect<br />
lawmakers to pass a bill that will avoid<br />
a no-deal Brexit - which economists<br />
warn could be catastrophic - the latest<br />
developments raised the prospect of it<br />
happening.<br />
"The pound fell because (the) vote<br />
leaves a no-deal Brexit on the table, but<br />
it has not collapsed into oblivion<br />
because at present there is no<br />
alternative to May's deal and we are<br />
not yet at the no-deal do-or-die<br />
moment," said Neil Wilson, chief<br />
market analyst at Markets.com.<br />
"Could she really get it through at the<br />
last? It would be a remarkable coup."<br />
But Minori Uchida, Tokyo head of<br />
global markets research at MUFG<br />
Bank, sounded a note of caution.<br />
"Players are still thinking that a hard<br />
Brexit will be avoided in the end, but<br />
the optimism is groundless," he told<br />
AFP. "Hard Brexit risks are still here."<br />
In early trade London rose 0.6<br />
percent, Paris added 0.5 percent and<br />
Frankfurt was flat.<br />
The pound sank around one percent<br />
against the dollar and the euro after<br />
the votes but it managed to edge back<br />
slightly on Wednesday.<br />
Equity markets swung as dealers<br />
look ahead to the end of the Federal<br />
Reserve's latest policy meeting later in<br />
the day, with hopes for some guidance<br />
on its plans for interest rates this year.<br />
Wednesday also sees the start of<br />
high-level US-China trade talks, with<br />
Beijing's top trade negotiator due to<br />
meet Donald Trump during the twoday<br />
gathering.<br />
However, while markets have been<br />
supported by optimism over the talks<br />
in recent weeks, the US decision<br />
Monday to charge Chinese telecom<br />
titan Huawei on several counts of fraud<br />
and tech theft has muddied the waters.<br />
Still, Treasury Secretary Steven<br />
Mnuchin insisted the two issues were<br />
not linked and said he saw the chance<br />
of a trade deal if China offered the right<br />
concessions.<br />
"Some dealers have been sitting on<br />
their hands in advance of the meeting<br />
as a hopes aren't overly high," said<br />
CMC Markets analyst David Madden.<br />
"Mnuchin… stated he expects<br />
'significant progress' to be made, but<br />
given the strained relationship<br />
between the US and China over the<br />
Huawei situation, the trade talks might<br />
suffer."<br />
Hong Kong closed up 0.4 percent,<br />
Shanghai ended down 0.7 percent and<br />
Tokyo lost 0.5 percent.<br />
Wellington, Singapore, Mumbai and<br />
Manila were all lower but Sydney<br />
edged up 0.2 percent and Seoul<br />
jumped one percent. In early trade<br />
London rose 0.6 percent, Paris added<br />
0.5 percent and Frankfurt was flat.<br />
The pound sank around one percent<br />
against the dollar and the euro after<br />
the votes but it managed to edge back<br />
slightly on Wednesday.<br />
Equity markets swung as dealers<br />
look ahead to the end of the Federal<br />
Reserve's latest policy meeting later in<br />
the day, with hopes for some guidance<br />
on its plans for interest rates this year.<br />
Wednesday also sees the start of<br />
high-level US-China trade talks, with<br />
Beijing's top trade negotiator due to<br />
meet Donald Trump during the twoday<br />
gathering.<br />
However, while markets have been<br />
supported by optimism over the talks<br />
in recent weeks, the US decision<br />
Monday to charge Chinese telecom<br />
titan Huawei on several counts of fraud<br />
and tech theft has muddied the waters.<br />
Still, Treasury Secretary Steven<br />
Mnuchin insisted the two issues were<br />
not linked and said he saw the chance<br />
of a trade deal if China offered the right<br />
concessions.<br />
"Some dealers have been sitting on<br />
their hands in advance of the meeting<br />
as a hopes aren't overly high," said<br />
CMC Markets analyst David Madden.<br />
"Mnuchin… stated he expects<br />
'significant progress' to be made, but<br />
given the strained relationship<br />
between the US and China over the<br />
Huawei situation, the trade talks might<br />
suffer." Hong Kong closed up 0.4<br />
percent, Shanghai ended down 0.7<br />
percent and Tokyo lost 0.5 percent.<br />
Wellington, Singapore, Mumbai and<br />
Manila were all lower but Sydney<br />
edged up 0.2 percent and Seoul<br />
jumped one percent.<br />
Mahanur Ummel<br />
Ara becomes<br />
Chairperson of PICL<br />
ExecutiveCommittee<br />
Noted entrepreneur of the<br />
country and director of<br />
Prime Insurance Company<br />
Limited Mahanur Ummel<br />
Ara has been elected as the<br />
new chairperson of the<br />
Executive Committee of<br />
Prime Insurance Company<br />
Ltd at its <strong>31</strong>0th board<br />
meeting held on 17th<br />
January, 2<strong>01</strong>9. a press<br />
release said.<br />
After completion of<br />
graduation she entered<br />
business and created own<br />
way. In addition of that she<br />
is a Director of Shepherd<br />
World Trade Ltd, life<br />
member of Gulshan Youth<br />
Club Limited, Gulshan<br />
Society and actively involved<br />
with a number of other<br />
social organizations.<br />
Mahanur Ummel Ara is<br />
very popular in the society<br />
for her personality and<br />
understanding.<br />
Winning back trust is seen as the key priority<br />
for Facebook as the world's biggest social<br />
network readies its update on the final<br />
months of 2<strong>01</strong>8 on Wednesday.<br />
Facebook is looking to rebound from a<br />
horrific year marked by a series of scandals<br />
over data protection and privacy and<br />
concerns that it had been manipulated by<br />
foreign interests for political purposes.<br />
Facebook so far has been able to keep<br />
revenue momentum thanks to its unique<br />
advertising model. Its global user base has<br />
risen to more than 2.2 billion, although<br />
growth has stalled in North America and<br />
Europe.<br />
In the quarter that ended in September,<br />
Facebook saw a profit of $5.14 billion on<br />
revenue that leaped 33 percent to $13.7<br />
billion. Industry tracker eMarketer expects<br />
Facebook's share of the global digital ad<br />
market to grow this year, with the social<br />
network claiming 20.5 percent of an overall<br />
$327.28 billion spent. But analysts say the<br />
trust issue is key for Facebook if it wants to<br />
move forward on its mission to connect the<br />
world. "Facebook needs a fresh start in 2<strong>01</strong>9,<br />
and what it reveals about its usage and<br />
revenue… will tell us just how feasible that<br />
fresh start will be," said<br />
eMarketer principal analyst Debra Aho<br />
Williamson. "In order for Facebook to move<br />
forward, it needs to show that its daily and<br />
monthly active user counts in the US and<br />
Canada and in Europe have stabilized, and<br />
that its ability to grow its ad revenue in those<br />
important regions has not been seriously<br />
impacted by the scandals and investigations<br />
of 2<strong>01</strong>8."<br />
Facebook has faced criticism that it has<br />
been used as a platform to spread divisive or<br />
misleading information, as was the case<br />
during the 2<strong>01</strong>6 election that put US<br />
President Donald Trump in the White<br />
House. It is also under heightened scrutiny<br />
over how it handles the sensitive personal<br />
data it collects from its users, with new<br />
privacy rules in place in Europe and<br />
legislation under consideration in<br />
Washington. "Facebook's future is going to<br />
be determined by whether users<br />
uncomfortable with being tracked disengage<br />
from using Facebook services,"<br />
said Richard Windsor, an analyst who<br />
pens the Radio Free Mobile blog. But<br />
Windsor said costs are still likely to rise<br />
much more quickly than revenues as<br />
Facebook hires more people to police its<br />
content. "The net result is further declines in<br />
the valuation to match the unwinding of<br />
profitability," he wrote. The California-based<br />
company also faces demographic challenges<br />
as younger users shift to other platforms,<br />
seeing Facebook as less cool than it was.<br />
It may be able to compensate with gains in<br />
other services, including its popular visual<br />
social network Instagram, messaging<br />
services WhatsApp and Messenger and its<br />
Oculus virtual reality division.<br />
Defending the ad model -<br />
Facebook co-founder and chief Mark<br />
Zuckerberg last week renewed his defense of<br />
the social network's business, arguing that<br />
targeting ads based on interests was different<br />
from selling people's data. "If we're<br />
committed to serving everyone, then we<br />
need a service that is affordable to everyone,"<br />
Zuckerberg wrote in The Wall Street<br />
Journal. Advertisers have generally<br />
remained true to Facebook, which lets<br />
businesses large or small precisely target<br />
messages to preferred demographics or<br />
geographies with measurable results. "There<br />
are more than 90 million small businesses<br />
on Facebook, and they make up a large part<br />
of our business," Zuckerberg wrote.<br />
"Most couldn't afford to buy TV ads or<br />
billboards, but now they have access to tools<br />
that only big companies could use before."<br />
eMarketer principal analyst Debra Aho<br />
Williamson. "In order for Facebook to move<br />
forward, it needs to show that its daily and<br />
monthly active user counts in the US and<br />
Canada and in Europe have stabilized, and<br />
that its ability to grow its ad revenue in those<br />
important regions has not been seriously<br />
impacted by the scandals and investigations<br />
of 2<strong>01</strong>8." Facebook has faced criticism that it<br />
has been used as a platform to spread<br />
divisive or misleading information, as was<br />
the case during the 2<strong>01</strong>6 election that put US<br />
President Donald Trump in the White<br />
House.<br />
It is also under heightened scrutiny over<br />
how it handles the sensitive personal data it<br />
collects from its users, with new privacy rules<br />
in place in Europe and legislation under<br />
consideration in Washington. "Facebook's<br />
future is going to be determined by whether<br />
users uncomfortable with being tracked<br />
disengage from using Facebook services,"<br />
said Richard Windsor, an analyst who<br />
pens the Radio Free Mobile blog. But<br />
Windsor said costs are still likely to rise<br />
much more quickly than revenues as<br />
Facebook hires more people to police its<br />
content.<br />
Citgo, the last gem of Venezuela's<br />
collapsed oil sector<br />
US sanctions imposed against Venezuela this<br />
week have cut off the final "gemstone" of the<br />
country's collapsed oil sector.<br />
Citgo, the US-based subsidiary of the<br />
Venezuelan state oil company PDVSA, was<br />
key to President Nicolas Maduro's fight to<br />
stay in power. But Washington's financial<br />
pressures applied on Monday against<br />
PDVSA will freeze $7 billion in US-based<br />
assets and block more than $11 billion in<br />
export proceeds. With PDVSA in default on<br />
debt payments, the US-based refiner and<br />
retailer Citgo was a financial intermediary<br />
returning revenue to the regime.<br />
Venezuela got 96 percent of its hard<br />
currency revenues from oil exports, and the<br />
US was the biggest cash customer, buying<br />
half a million barrels per day. In contrast,<br />
about a third of production goes to China<br />
and Russia but is used to pay off debts. US<br />
Treasury Secretary Steven Mnuchin said<br />
Citgo can continue to operate -but its<br />
earnings must be deposited into a blocked<br />
account in the United States.<br />
The sanctions aim to cripple Maduro after<br />
the US and other countries recognized Juan<br />
Guaido, the head of the National Assembly<br />
legislature who has declared himself<br />
Venezuela's acting president.<br />
"It will crush the Venezuelan economy. It's<br />
going to have a dramatic effect," Christopher<br />
Sabatini, adjunct professor of International<br />
and Public Affairs at Columbia University,<br />
said of the sanctions. In response, Maduro<br />
told PDVSA to take action in US and<br />
international courts to defend Citgo, his last<br />
big overseas asset, which allowed the country<br />
to sell its heavy crude into the US market.<br />
Citgo is based in Houston and has three<br />
refineries that specialize in heavy crude and<br />
have a total capacity of 750,000 barrels a<br />
day, according to the company website.<br />
Founded as Cities Service Company by<br />
oilman Henry Doherty in 1910, it became<br />
wholly-owned by PDVSA in 1990.<br />
Citgo now employs 3,500 people, operates<br />
48 petroleum product terminals, and has<br />
pipelines and a network of more than 5,000<br />
service stations associated with the brand<br />
across the US.<br />
Venezuela is a member of the Organization<br />
of the Petroleum Exporting Countries<br />
(OPEC) and sits on the world's largest<br />
petroleum reserves, most of it heavy crude<br />
that is costly to produce. But the country's<br />
economy has been shrinking since 2<strong>01</strong>4, the<br />
year global oil prices collapsed. Worsening<br />
conditions have forced more than two<br />
million people to flee the<br />
country, where food and medicine are<br />
scarce and the International Monetary Fund<br />
forecasts that inflation this year will reach 10<br />
million percent. Venezuelan oil output has<br />
fallen from more than three million barrels<br />
per day in the 1990s to 1.339 mbd last year,<br />
according to OPEC data. Production has<br />
been hampered by chronic underinvestment<br />
by PDVSA. Sabatini described<br />
Citgo as "the last remaining gemstone of the<br />
Venezuelan oil empire," a company which<br />
was "the anchor to the US market."<br />
Since 2<strong>01</strong>7, Washington had already<br />
forbidden US citizens and companies from<br />
trading debt issued by Venezuela or PDVSA.<br />
"When PVDVSA began to have default and<br />
sanctions, nobody wanted to give credit to<br />
PDVSA," said Francisco Monaldi, a fellow in<br />
Latin American energy policy at Rice<br />
University in Houston.<br />
But Citgo has "a good cash flow" in the<br />
United States, which enabled the state oil<br />
firm to make purchases without having to<br />
pay up-front. The US company, for example,<br />
could buy products such as the diluent<br />
required to process heavy oil and send them<br />
back to Venezuela.<br />
"It is a strategic resource in that sense,"<br />
Monaldi said, adding that the company also<br />
allowed Venezuela to have a lobbying voice<br />
in the US oil industry.<br />
Photo shows Mahanur<br />
Ummel Ara , new chairperson<br />
of the Executive<br />
Committee of Prime<br />
Insurance Company Ltd<br />
elected at its <strong>31</strong>0th<br />
board meeting held on<br />
17th January, 2<strong>01</strong>9.<br />
Photo: Courtesy<br />
Greece raises 2.5 bn<br />
euros in first bond<br />
sale since bailout<br />
Greece on Tuesday raised 2.5<br />
billion euros (2.9 billion)<br />
from a five-year-bond, its first<br />
since exiting the last bailout,<br />
the finance minister said.<br />
"This is 36 percent of our<br />
requirements for 2<strong>01</strong>9,"<br />
finance minister Euclid<br />
Tsakalotos said in parliament,<br />
according to the state-run<br />
Athens News Agency.<br />
The yield was set at 3.6<br />
percent, Tsakalotos said.<br />
Merrill Lynch, Goldman<br />
Sachs International Bank,<br />
HSBC, JP Morgan, Morgan<br />
Stanley and Societe Generale<br />
were named as managers of<br />
the bond, which has an April<br />
2024 maturity.<br />
The previous five-year<br />
bond, in July 2<strong>01</strong>7, raised 3.0<br />
billion euros at 4.625 percent.