Business

Israel-Hamas conflict damaging regional economies, warns IMF chief

Published

1 year ago

Farwa

The ongoing conflict between Israel and Hamas is not only causing human suffering but also taking a toll on regional economies, Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva said Wednesday.

Speaking at the Future Investment Initiative (FII) in Riyadh, Saudi Arabia, Georgieva highlighted the economic repercussions that neighbouring countries of Israel are experiencing, particularly those reliant on tourism, such as Egypt, Lebanon, and Jordan.

The conflict erupted when Hamas, a Palestinian group, launched a surprise attack on Israel on October 7, resulting in casualties and the taking of hostages.

Israel responded with a sustained campaign of air strikes and a comprehensive land, sea, and air blockade on Gaza. The Hamas-run health ministry in Gaza reported that the war has claimed the lives of 6,546 Palestinians.

The economic implications of this conflict extend beyond the immediate war zone. Wall Street experts have warned that the ongoing hostilities could negatively impact the global economy, particularly if other countries become embroiled in the crisis. Georgieva expressed her concerns about the economic challenges faced by countries in the region.

Uncertainty and insecurity are detrimental to countries dependent on tourism, and investors may become cautious about the region. This caution extends to the cost of insurance for goods transportation, which could rise due to heightened risks. Furthermore, the influx of refugees into countries already accommodating displaced populations poses additional economic challenges.

The Future Investment Initiative (FII), often called “Davos in the Desert,” has historically been a platform for Saudi Arabia to showcase its domestic economic reforms and regional stability. Saudi Arabia had recently taken steps to improve relations with Iran and Syria, sought a lasting ceasefire in Yemen, and was in discussions regarding recognising Israel before the conflict erupted on October 7.

While Saudi officials have indicated that the normalisation of ties with Israel may be paused for now, regional stability remains a top priority. Saudi Finance Minister Mohammed al-Jadaan emphasised the importance of preserving the de-escalation efforts that were underway before the outbreak of hostilities.

Bahrain’s Finance Minister, Shaikh Salman bin Khalifa Al Khalifa, who recognised Israel as part of the US-brokered Abraham Accords in 2020, advocated for regional integration. He stressed that past ethnic and religious divisions should not hinder future cooperation.

Jared Kushner, a former White House advisor and key figure behind the Abraham Accords, suggested that the attack by Hamas was intended to disrupt the normalisation of relations.

The Abraham Accords, which aimed to establish diplomatic ties between Israel and several Arab nations, have been viewed as a potential threat by those opposed to such diplomatic progress.

Despite the ongoing regional turmoil, many at the FII remain optimistic about Saudi Arabia’s resilience. As the world’s largest oil exporter, Saudi Arabia is well-positioned to withstand shocks and finance its Vision 2030 agenda.

This ambitious plan, spearheaded by Crown Prince Mohammed bin Salman, seeks to diversify the Saudi economy by promoting tourism, business, and mega-projects such as NEOM, a futuristic city with a $500 billion price tag.

While the region grapples with the ramifications of the Israel-Hamas conflict, Saudi Arabia aims to press ahead with its economic transformation, offering opportunities for companies and investors from around the world in the Middle East’s largest economy and construction market.

In conclusion, the Israel-Hamas conflict is not only a humanitarian crisis but also has far-reaching economic consequences for neighbouring countries and the broader region, impacting tourism, investment, and political stability. The situation remains complex, and efforts to restore peace and stability are crucial for the well-being of both people and economies in the Middle East.

Business

With its second-largest surge ever, PSX approaches 114,000 points.

Published

2 days ago

Farwa

Driven by renewed activity from both private and government financial institutions, the Pakistan Stock Exchange (PSX) saw its second-largest rally in history on Monday.

The market regained many important levels in a single trading session as it rose with previously unheard-of momentum.

Intraday trading saw a top increase of 4,676 points, and the PSX’s benchmark KSE-100 Index gained 4,411 points to settle at 113,924 points. This impressive rebound demonstrated significant investor confidence by reestablishing the 100,000, 111,000, 112,000, and 113,000-point levels.

The market also saw the 114,000-point limit reestablished during the trading session.

The positive tendency was reflected when the market’s heavyweight shares touched its upper circuits. Among the most busiest trading sessions in recent memory, an astounding 85.78 billion shares worth a total of Rs55 billion were exchanged.

Experts credited the spike to heightened institutional investor activity and hope for macroeconomic recovery. Considered a major market recovery, the rally demonstrated the market’s tenacity and development potential.

Business

In interbank trade, the Pakistani rupee beats the US dollar.

Published

1 week ago

Farwa

In the international exchange market, the US dollar has continued to weaken in relation to the Pakistani rupee.

The dollar fell to Rs278.10 from Rs278.17 at the beginning of interbank trading, according to currency dealers, a seven paisa loss.

In the meantime, there was a lot of turbulence in the stock market, but it recovered and moved into the positive zone. The KSE-100 index recovered momentum and reached 116,000 points after soaring 1,300 points.

Both currency and stock market swings, according to analysts, are a reflection of ongoing market adjustments and economic uncertainty.

Business

Phase II of CPEC: China-Pakistan Partnership Enters a New Era

Published

1 week ago

Farwa

The cornerstone of economic cooperation between the two brothers and all-weather friends is still the China-Pakistan Economic Corridor, the initiative’s flagship project.

In contrast to reports of a slowdown, recent events indicate a renewed vigour and strategic emphasis on pushing the second phase of CPEC, known as CPEC Phase-2, according to the Ministry of Planning, Development, and Special Initiatives.

According to the statement, this crucial stage seeks to reshape the foundation of bilateral ties via increased cooperation, cutting-edge technology transfer, and revolutionary socioeconomic initiatives.

Planning Minister Ahsan Iqbal is leading Pakistan’s participation in a number of high-profile gatherings in China, such as the 3rd Forum on China-Indian Ocean Region Development Cooperation in Kunming and the High-Level Seminar on CPEC-2 in Beijing.

His involvement demonstrates Pakistan’s commitment to reviving CPEC, resolving outstanding concerns, and developing a strong phase-2 roadmap that considers both countries’ long-term prosperity.

At the core of these interactions is China’s steadfast determination to turn CPEC into a strategic alliance that promotes development, progress, and connectivity.

Instead of being marginalised, CPEC is developing into a multifaceted framework with five main thematic corridors: the Opening-Up/Regional Connectivity Corridor, the Innovation Corridor, the Green Corridor, the Growth Corridor, and the Livelihood-Enhancing Corridor.

With the help of projects like these, the two countries will fortify their partnership, and CPEC phase-2 will become a model of global economic integration and collaboration that benefits not just China and Pakistan but the entire region.