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line 275, column 0: content:encoded should not contain aria-level attribute (12 occurrences) [help]
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<li aria-level="1">Digital-first approach: Entirely online operations ...
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Source: https://economystandard.com/feed/

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<title>Novavax signs COVID-19 license deal with Sanofi, removes doubt about business viability</title>
<link>https://economystandard.com/novavax-signs-covid-19-license-deal-with-sanofi-removes-doubt-about-business-viability/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Fri, 10 May 2024 13:33:36 +0000</pubDate>
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<description><![CDATA[Novavax signs COVID-19 license deal with Sanofi, removes doubt about business viability PARIS (Reuters) -Novavax on Friday erased doubts about its ability to remain in business and struck a licensing…]]></description>
<content:encoded><![CDATA[<h2>Novavax signs COVID-19 license deal with Sanofi, removes doubt about business viability</h1>
PARIS (Reuters) -Novavax on Friday erased doubts about its ability to remain in business and struck a licensing deal worth up to $1.2 billion with Sanofi for COVID-19 vaccines in exchange for a stake that doubles the U.S. drugmaker’s market value.
In February last year, Novavax raised doubts about its business viability after missing out on the COVID-19 vaccine windfall due to manufacturing issues that delayed filing for regulatory approval. Its COVID shot got U.S. approval in July 2022, long after Pfizer and Moderna were in use.
Novavax said it would co-commercialize its COVID-19 vaccine with French drugmaker Sanofi and develop new COVID-19-influenza combination vaccines using Novavax’s Matrix-M adjuvant.
Sanofi will pay Novavax $500 million upfront and up to $700 million in development, regulatory and launch milestones, the companies said. Novavax will also get double-digit percentage royalty payments on sales of its COVID-19 and flu-COVID-19 combination vaccines.
Sanofi will take a 4.9% stake in the U.S. drugmaker for $70 million. That values Novavax at about $1.4 billion, nearly double its market capitalisation of about $628 million as of Thursday but a far cry from its peak of $20 billion in 2021.
“We’re excited by the prospect of combining Novavax’s adjuvanted COVID-19 vaccine that has shown high efficacy and favorable tolerability, with our rich portfolio of differentiated flu vaccines (…)”, Sanofi’s head of vaccines R&D, Jean-Francois Toussaint, said in a statement.
Novavax also reported that its net loss narrowed to $148 million in the first quarter from $294 million in the year-ago period.
Its revenue rose to $94 million from $81 million and the company said it expects full-year revenue of $400 million to $600 million.
Novavax also said plans to reduce 2025 research and development expenses to below $500 million, a portion of which it expects to recover from Sanofi under their deal.
(Reporting by Tassilo Hummel; Reporting by Shubham Kalia and Utkarsh Shetti in Bangalore; Editing by Benoit Van Overstraeten and Savio D’Souza)
 
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<title>Retailer Lidl UK raises staff pay for third time in 12 months</title>
<link>https://economystandard.com/retailer-lidl-uk-raises-staff-pay-for-third-time-in-12-months/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Fri, 10 May 2024 11:07:10 +0000</pubDate>
<category><![CDATA[Headlines]]></category>
<guid isPermaLink="false">https://economystandard.com/?p=22043</guid>
<description><![CDATA[Retailer Lidl UK raises staff pay for third time in 12 months LONDON (Reuters) – The British arm of German supermarket group Lidl said it would lift wages by over…]]></description>
<content:encoded><![CDATA[<h2>Retailer Lidl UK raises staff pay for third time in 12 months</h1>
LONDON (Reuters) – The British arm of German supermarket group Lidl said it would lift wages by over 3% in June, giving thousands of workers a third pay rise in 12 months.
Lidl said on Friday it would raise pay for staff across Britain to 12.40 pounds per hour from 12 pounds per hour, while London-based staff would receive 13.65 pounds per hour, up from 13.55.
Pay rises at big employers like Lidl, which employs 32,000 people across Britain, are closely watched by the Bank of England, which said on Thursday it remains on guard because of still-strong growth in wages which add to inflationary pressure.
John Lewis and Co-op in March announced pay rises of 10% after the government raised the national living wage to 11.44 pounds an hour.
Lidl, part of Germany’s Schwarz retail group which is Britain’s the sixth biggest supermarket chain with an 8% share, said its latest increase would mean its staff continue to receive “industry-leading pay”.
 
(Reporting by Sarah Young; editing by William James)
 
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<title>Honda sees full-year profit rising 2.8%</title>
<link>https://economystandard.com/honda-sees-full-year-profit-rising-2-8/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Fri, 10 May 2024 10:39:54 +0000</pubDate>
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<description><![CDATA[Honda sees full-year profit rising 2.8% TOKYO (Reuters) – Japan’s Honda Motor Co forecast a 2.8% rise in operating profit for this financial year, after it exceeded analysts’ estimates in…]]></description>
<content:encoded><![CDATA[<h2>Honda sees full-year profit rising 2.8%</h1>
TOKYO (Reuters) – Japan’s Honda Motor Co forecast a 2.8% rise in operating profit for this financial year, after it exceeded analysts’ estimates in the fourth quarter as strong sales growth in the United States offset a decline in China.
Japan’s second-largest automaker by volume forecast full-year operating profit would rise to 1.42 trillion yen ($9.13 billion) compared with an average profit estimate of 1.39 trillion yen in a poll of 22 analysts by LSEG.
Operating profit for the three months to March 31 grew more than six-fold from a year earlier to 305.6 billion yen, well ahead of the 248.3 billion yen average expected by nine analysts.
The automaker posted a 17% sales rise in its biggest overseas market, the U.S., to about 378,000 vehicles over that period. However, its sales in China fell by more than 6% in January-March to about 207,000 vehicles.
In China, the world’s biggest auto market, Honda is among Japanese car brands that have struggled against more nimble and faster-moving local rivals that have attracted Chinese drivers with low-cost, technology-loaded electric vehicles.
Honda, which remains a latecomer to EVs, said last month it plans to build an EV production base in Ontario, Canada and launch six EV models branded Ye in China by 2027.
($1 = 155.5500 yen)
 
(Reporting by Daniel Leussink; Editing by Sonali Paul)
 
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<title>Pandemic treaty talks to the wire, likely to miss first deadline, sources say</title>
<link>https://economystandard.com/pandemic-treaty-talks-to-the-wire-likely-to-miss-first-deadline-sources-say/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Fri, 10 May 2024 08:18:41 +0000</pubDate>
<category><![CDATA[Headlines]]></category>
<guid isPermaLink="false">https://economystandard.com/?p=22025</guid>
<description><![CDATA[Pandemic treaty talks to the wire, likely to miss first deadline, sources say By Jennifer Rigby LONDON (Reuters) – Talks to draw up a global pact to help fight future…]]></description>
<content:encoded><![CDATA[<h2>Pandemic treaty talks to the wire, likely to miss first deadline, sources say</h1>
By Jennifer Rigby
LONDON (Reuters) – Talks to draw up a global pact to help fight future pandemics are likely to miss an initial deadline on Friday, three sources close to the process said.
Negotiators from the World Health Organization’s 194 member states were hoping to have a final draft agreement by the end of Friday, with a view toward adopting the legally-binding text at the World Health Assembly later this month.
Instead talks on the text may have to continue, sources said, as countries grapple with key sticking points.
“There is no chance at all of us reaching agreement by Friday,” said one Western diplomat.
The aim of the document, alongside a series of updates to existing rules on dealing with pandemics, is to shore up the world’s defences against new pathogens after the COVID-19 pandemic killed millions of people.
But there have been deep disagreements throughout the negotiating process, particularly around equity. The accord, commonly known as a treaty, has also become politicised in some countries.
“Talks will continue to Friday night, 00.00 hours,” Roland Driece, one of the co-chairs of the intergovernmental negotiating body leading the treaty talks, said in an email. “Then, we will discuss where we stand and what needs to be done.”
WHO chief Tedros Adhanom Ghebreyesus said this week teams were “strongly committed to finalizing the agreement in time for the World Health Assembly.”
VACCINE SHARING
Some of the treaty’s most contentious elements, including details around a “pathogen access and benefits system”, have already been pushed back for later discussion, with a deadline two years from now. The system intends to codify sharing of material with pandemic potential, such as new viruses or strains, and ensure that all countries benefit fairly from vaccines, drugs and tests developed as a result.
The existing draft treaty includes a clause asking pharmaceutical manufacturers to reserve 10% of such items to donate to the WHO, and 10% for the agency to buy at affordable prices, to distribute in poorer countries during health emergencies.
A report earlier this week in the UK’s Telegraph newspaper said the UK would not sign a treaty the country says would force it to give away a fifth of its vaccines. Negotiations are ongoing, a WHO spokesperson said on Thursday.
An official involved in the talks said while most countries supported a commitment to fairer vaccine access, a fixed percentage was not finalized.
An existing agreement that governs pandemic influenza also has a clause about selling vaccines at affordable prices or donating them to WHO. It allows for between 5% and 20% for both options, to allow for flexibility in negotiating with manufacturers.
This framework is what would be brought into play should the H5N1 strain of avian flu, which has raised alarm after being identified in cows in the United States as well as among other animals and birds, become easily transmissible between humans.
The WHO currently assesses that threat as low as there has been no evidence of human-to-human spread.
External experts said losing political momentum for the pandemic accord was a risk if there are delays, particularly in an election year for many countries.
“It’s not over til it’s over,” said Alexandra Phelan, a global health law expert at Johns Hopkins University in Baltimore. “But over is rapidly approaching.”
 
(Reporting by Jennifer Rigby; Editing by Bill Berkrot)
 
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<title>Rio Tinto had considered a bid for BHP-target Anglo American, AFR reports</title>
<link>https://economystandard.com/rio-tinto-had-considered-a-bid-for-bhp-target-anglo-american-afr-reports/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Fri, 10 May 2024 08:08:45 +0000</pubDate>
<category><![CDATA[Headlines]]></category>
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<description><![CDATA[Rio Tinto had considered a bid for BHP-target Anglo American, AFR reports (Reuters) -Mining giant Rio Tinto had considered an offer for British miner Anglo American, which is now BHP…]]></description>
<content:encoded><![CDATA[<h2>Rio Tinto had considered a bid for BHP-target Anglo American, AFR reports</h1>
(Reuters) -Mining giant Rio Tinto had considered an offer for British miner Anglo American, which is now BHP Group’s $39 billion takeover target, the Australian Financial Review reported on Friday.
Rio “management had not ruled out making a play for part or all of the mining group and continued to study the day-to-day situation”, the AFR reported, citing sources close to Rio.
The report did not mention why Rio did not make a proposal but said there is no suggestion that Rio is about to make an alternative bid. Rio declined to comment on the report.
BHP shares were down 0.4%, while Rio Tinto was trading flat. The Australian mining index was also flat as of 0438 GMT.
Anglo has turned down BHP’s proposal, saying it was opportunistic and significantly undervalues the British company. BHP has until May 22 to make a formal offer under the UK’s takeover rules.
Glencore is also studying options for a possible approach for Anglo, Reuters reported earlier in the month, a move that could spark a bidding war.
“Our policy is we don’t speculate or comment on M&A activity,” Rio’s chair, Dominic Barton, said in reply to a question at a shareholder meeting last week on whether the company was considering a rival bid.
BHP and Rio work closely together on the Escondida and Resolution Copper mines, in which they both own stakes.
Rio should not stand against BHP but instead should look at smaller copper and lithium miners, said Daniel Sullivan, portfolio manager of Janus Henderson Investors’ global natural resources fund that owns shares in Rio, the AFR report said.
(Reporting by Rishav Chatterjee in Bengaluru and Melanie Burton in Melbourne; Editing by Savio D’Souza and Rashmi Aich)
 
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<title>GeoPark to access $500 million from Vitol in return for oil deliveries</title>
<link>https://economystandard.com/geopark-to-access-500-million-from-vitol-in-return-for-oil-deliveries/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Fri, 10 May 2024 07:36:28 +0000</pubDate>
<category><![CDATA[Headlines]]></category>
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<description><![CDATA[GeoPark to access $500 million from Vitol in return for oil deliveries (Reuters) – GeoPark has struck a deal to sell a minimum of 20,000 barrels of oil per day…]]></description>
<content:encoded><![CDATA[<h2>GeoPark to access $500 million from Vitol in return for oil deliveries</h1>
(Reuters) – GeoPark has struck a deal to sell a minimum of 20,000 barrels of oil per day to Dutch commodities trading firm Vitol, receiving access to up to $500 million in funding in return, the Latin American oil and gas producer said on Thursday.
As part of the agreement, Geopark said it will obtain immediate access to up to $300 million from Vitol and will have an option to increase the funding by another $200 million.
Reuters was unable to confirm what the funds will be used for.
The deal to sell oil, which comes out of its Colombia project, will begin on July 1 this year and will last for a minimum of 20 months, GeoPark said, adding that it is likely to go up to 36 months.
The agreement improves GeoPark’s price realizations by $0.15 per barrel compared to the current agreement, GeoPark said.
 
(Reporting by Chandni Shah in Bengaluru; Editing by Janane Venkatraman)
 
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<item>
<title>China’s push for greener aluminium hit by erratic rains, power cuts</title>
<link>https://economystandard.com/chinas-push-for-greener-aluminium-hit-by-erratic-rains-power-cuts/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Fri, 10 May 2024 06:39:40 +0000</pubDate>
<category><![CDATA[Headlines]]></category>
<guid isPermaLink="false">https://economystandard.com/?p=22008</guid>
<description><![CDATA[China’s push for greener aluminium hit by erratic rains, power cuts BEIJING (Reuters) – Erratic rainfall in China’s southwest is frustrating a multibillion-dollar push to green an aluminium industry that…]]></description>
<content:encoded><![CDATA[<h2>China’s push for greener aluminium hit by erratic rains, power cuts</h1>
BEIJING (Reuters) – Erratic rainfall in China’s southwest is frustrating a multibillion-dollar push to green an aluminium industry that accounts for almost 60% of global output and, by some estimates, emits more carbon dioxide than Australia.
Lured by official promises of cheap hydropower, China Hongqiao Group and a handful of other coal-reliant smelters several years ago began moving 6.56 million metric tons of capacity – about 15% of China’s total – from the northern rust belt to the mountainous and ethnically diverse Yunnan province, known for tea, coffee and wild mushrooms.
The opportunity to cut electricity bills and help the world’s top polluter tackle global warming seemed like a safe bet. But as Yunnan’s rivers and reservoirs dwindled amid poor rainfall, which some experts attribute to climate change, so did the reliability of electricity.
Reuters interviews with almost two dozen industry figures and analysts, as well as company filings and official documents, found insufficient hydropower has meant that only a little over half of the planned aluminium capacity shift has materialised. Some smelters are slowing or scaling back their already-delayed plans and others are seeking alternative locations.
“The power cuts in the past two years have made it clear that Yunnan can’t be sustained as a major producing region,” said one Yunnan industry figure who, as with others, spoke on the condition of anonymity due to the issue’s sensitivity.
Despite growing demand for low-carbon products and strong industry profits in recent years, eight employees at four Yunnan smelters said they have had to cut production by 10% to 40%.
Muyi Yang, an adjunct fellow at the University of Technology Sydney who researches energy policy, said any supply disruptions would delay China’s broader energy transition because aluminium is used in many clean technologies.
In addition to hindering China’s climate goals, the hydro crunch has caused volatility in global aluminium prices and imperilled the potential for producers to cash in on demand for “green” metal, according to the analysts and industry sources.
Hongqiao’s plan to move almost 4 million tons of production from Shandong province to Yunnan involved building two plants near the Vietnam border, in Wenshan and Honghe prefectures, each with capacity of roughly 2 million tons.
The 17 billion yuan ($2.35 billion) Wenshan factory opened in 2020 and was intended to reach full capacity in August 2022, the director of the industrial park where it is located told state media in 2021. But unstable hydropower has prevented that, two industry figures said.
At Honghe, production was due to begin in March 2023, according to a December 2021 overview of projects published by the Yunnan Department of Industry and Information Technology. Yet, initial production capacity of just 500,000 tons will be ready in the middle of this year, according to a person familiar with the matter.
Chen Xinlin, a senior metals and mining consultant at Wood Mackenzie, said Honghe’s capacity may not be commissioned this year due to the “hydropower bottleneck”.
Hongqiao and its parent, Shandong Weiqiao Pioneering Group, did not respond to Reuters questions about the matter, and the Yunnan government declined to comment.
China’s environment and industry ministries, and the top planning agency, the National Development and Reform Commission (NDRC), did not respond to requests for comment.
GREEN DREAMS
Aluminium accounts for about 3% of the world’s direct industrial carbon dioxide, according to the International Energy Agency.
For China, that meant cleaning up the sector would be crucial to its goals, formalised in 2020, of ensuring the country’s carbon emissions peak by the end of this decade and reach net zero by 2060.
Part of the allure of aluminium made from hydropower or other clean energy is that producers may be able to charge premiums as global manufacturers raise their carbon standards for materials, though only a tiny proportion of green aluminium currently attracts such a premium.
Besides Hongqiao, producers including industry leader Aluminium Corporation of China, known as Chinalco, were drawn to Yunnan by provincial authorities’ offer of discounted greener power at 0.25 yuan per kilowatt hour (kWh), less than half of what they were paying in northern China.
Chinalco announced in 2018 that it would move 1.2 million tons to Yunnan, and suppliers including anode producer Sunstone Development followed. Neither responded to requests for comment.
The new smelters brought in staff from China’s north, with factory canteens serving braised noodles and shaobing, a flatbread stuffed with meat, to give workers a taste of home.
The plants produce silver-coloured ingots cast from molten aluminium into square-shaped bundles. These are collected by trucks and delivered to factories for processing into goods such as car parts, window frames and beer cans.
A 2022 World Economic Forum report anticipated that 2 to 3 million tons of primary aluminium production would move annually to China’s southwest, mostly Yunnan, from 2020 to 2025, tapering to 90,000 to 100,000 tons per year by 2060.
The pace has been much slower.
Officials had been aware that power was a potential constraint.
“Solving power supply issues is the first thing Wenshan needs to work on to develop a green aluminium industry,” He Chun, deputy bureau chief of the Wenshan Energy Bureau, told state media in 2021.
But rains proved uncooperative. Yunnan’s Water Resources Department said in January that severe drought had persisted for a fifth year, leading to reduced hydropower generation.
On April 16, Wenshan officials warned of extreme drought conditions in Yanshan county, where several aluminium plants are located, including a Hongqiao smelter. Average rainfall so far this year is down 37%, according to the Wenshan government.
Adding to the smelters’ dilemma, the NDRC in 2021 banned discounted power rates for aluminium producers.
‘MAY THERE BE MORE RAIN’
In interviews with Reuters, 10 of the industry figures at smelters that moved to Yunnan described higher-than-expected electricity rates and periodic orders from the energy provider, China Southern Power Grid, to shut down on short notice.
Electricity rates had risen to 0.47 to 0.50 yuan per kWh, seven of these people said, still below what smelters paid in the north.
China Southern did not respond to a faxed request for comment.
Producers including Chinalco-owned Yunnan Aluminium and Henan Shenhuo Coal & Power, neither of which responded to requests for comment, have cited Yunnan’s power-supply problems in financial filings.
In its 2023 annual report, Shenhuo warned that further increases in electricity rates or supply disruptions would create uncertainty for its operations.
Yunnan has sought to free up electricity by curbing transfers to other provinces. The provincial government has also said it will accelerate construction of wind and solar power, as well as more hydropower stations, and bolster its capacity for thermal power, which mainly comes from coal.
But frustrated smelting-industry figures talk of looking elsewhere.
“No one dares to stick with their relocation plan” because of Yunnan’s power issues, said a manager at a Yunnan smelter.
Analysts expect more capacity to shift to northwestern China, where there is more access to power, including from coal that can assure stable supply for smelters.
In May 2023, Weiqiao’s chairman Zhang Bo announced plans with Shandong Chuangxin Group to build a green aluminium base in Inner Mongolia, powered by wind and solar, according to a statement on the regional government’s website.
For now, Yunnan smelter operators are looking to the skies.
“May there be more rain, that’s the best thing we can wish for,” said one smelter employee.
($1 = 7.2448 Chinese yuan renminbi)
 
(Reporting by Beijing Newsroom; editing by Tony Munroe and David Crawshaw)
 
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<item>
<title>The growth of Neobanking in emerging economies: Opportunities and risks</title>
<link>https://economystandard.com/the-growth-of-neobanking-in-emerging-economies-opportunities-and-risks/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Thu, 09 May 2024 21:36:13 +0000</pubDate>
<category><![CDATA[Finance]]></category>
<guid isPermaLink="false">https://economystandard.com/?p=21699</guid>
<description><![CDATA[The growth of Neobanking in emerging economies: Opportunities and risks The emergence of neobanking as a powerful disruptor in the financial landscape is reshaping how services are delivered in emerging…]]></description>
<content:encoded><![CDATA[<h2>The growth of Neobanking in emerging economies: Opportunities and risks</h1>
The emergence of neobanking as a powerful disruptor in the financial landscape is reshaping how services are delivered in emerging economies. This digital revolution brings both immense opportunities and notable risks, which warrant a balanced analysis to comprehend fully the potential impacts on economic development, financial inclusion, and market stability.
Understanding Neobanking
What is Neobanking? 
Neobanking refers to a new type of bank that operates exclusively online without traditional physical branch networks. These banks leverage technology to offer more accessible, user-friendly, and cost-effective financial services compared to traditional banking institutions.
Core features of Neobanks
<ul>
<li aria-level="1">Digital-first approach: Entirely online operations that eliminate the need for physical branches.</li>
<li aria-level="1">User-friendly interfaces: Simplified banking processes through modern apps and platforms.</li>
<li aria-level="1">Lower fees: Reduced overhead costs allow for cheaper services.</li>
<li aria-level="1">Innovative products: Tailored financial products that meet the needs of digitally savvy customers.</li>
</ul>
Neobanking in emerging economies
Adoption drivers in emerging markets
<ul>
<li aria-level="1">High mobile penetration: Widespread use of smartphones makes access to digital banking easier.</li>
<li aria-level="1">Young demographics: A young population that is tech-savvy and open to trying new financial solutions.</li>
<li aria-level="1">Underbanked populations: Significant portions of the population lack access to traditional banking services.</li>
</ul>
Examples of Neobanking impact 
Countries like Brazil, India, and Nigeria have seen a surge in neobanking activities, with startups such as Nubank, Paytm, and OPay leading the way in revolutionizing financial services.
Opportunities presented by Neobanking
Enhancing financial inclusion 
Neobanks have the potential to bring millions into the formal financial system, offering low-cost services to people who previously could not afford bank accounts.
Driving financial innovation 
The competitive pressure from neobanks pushes traditional banks to innovate, leading to better services across the financial sector.
Empowering SMEs 
Small and medium enterprises benefit from neobanking services that provide easier access to business loans, streamlined payment systems, and improved financial management tools.
Risks and challenges
Regulatory hurdles 
Neobanks face significant scrutiny from financial regulators who are concerned about issues like customer data security and systemic risk.
Market volatility 
Emerging markets are prone to economic instability, which can affect the sustainability of neobanks that lack the financial depth of traditional banks.
Dependence on technology 
The reliance on digital platforms exposes neobanks to cyber threats and technological failures that can undermine trust and stability.
Balancing the scales: Managing opportunities and risks
Strategic partnerships 
Collaborating with traditional banks and fintech firms can provide neobanks with the robustness needed to handle regulatory and operational challenges.
Investing in cybersecurity 
Strong focus on cybersecurity can help protect customer data and build trust.
Continuous innovation 
By continuously innovating, neobanks can adapt to market changes and regulatory demands, keeping their services relevant and competitive.
Ensuring sustainable growth through education and awareness 
Educational initiatives aimed at both consumers and neobank operators can play a crucial role in promoting the safe use of these technologies. Understanding the tools and potential risks associated with digital banking can lead to more informed decisions by users and a stronger regulatory framework.
Adapting to local needs and cultures 
Neobanks must tailor their services to fit the unique cultural and economic contexts of each market. For instance, incorporating local languages and culturally relevant financial services can enhance accessibility and user engagement.
Fostering financial literacy 
One significant challenge in emerging markets is the lack of financial literacy. Neobanks, with their digital platforms, are uniquely positioned to offer educational resources that help users understand personal finance management, investing, and the benefits of banking.
Monitoring and responding to economic fluctuations 
Given that emerging markets often experience economic instability, neobanks need to develop robust risk management frameworks that allow them to remain resilient and adaptable in the face of economic downturns.
Promoting transparency and trust 
Transparency in how services are provided and how data is used can help build trust between neobanks and their customers. Clear communication regarding fees, data protection policies, and the operational model will be vital.
Leveraging data for better services 
Neobanks collect vast amounts of data that can be used to improve customer experiences and tailor financial products to better meet the needs of individual users. By leveraging data analytics and AI, neobanks can enhance their operational efficiency and service personalization.
Integrating with Global financial systems 
For neobanks in emerging economies to thrive, they need to be seamlessly integrated into the global financial system. This includes compliance with international financial regulations and the ability to conduct transactions across borders with reliability and security.
Navigating the digital divide 
While mobile penetration is high in many emerging markets, disparities in access to technology still exist. Neobanks must consider strategies to bridge the digital divide, such as offering offline services or simpler versions of their apps to accommodate users with limited internet access.
Innovating beyond financial transactions 
To truly revolutionize the financial sector, neobanks need to look beyond mere transactional services. Innovations in financial education, investment planning, and even insurance services can provide a more holistic financial ecosystem for users.
FAQs
<ol>
<li aria-level="1">What makes neobanks appealing to consumers in emerging markets? 
Neobanks offer convenience, reduced fees, and innovative services that appeal to tech-savvy consumers and those underserved by traditional banks.</li>
<li aria-level="1">How do neobanks contribute to financial inclusion? 
They provide accessible financial services to the unbanked population, helping to integrate more people into the economy.</li>
<li aria-level="1">What are the main risks associated with neobanking in emerging economies? 
Key risks include regulatory challenges, market volatility, and technological dependencies.</li>
<li aria-level="1">Can neobanks replace traditional banks in emerging markets? 
While neobanks are changing the banking landscape, they are unlikely to completely replace traditional banks but rather complement them by filling service gaps.</li>
<li aria-level="1">How can consumers safeguard their information when using neobanking services? 
Consumers should use strong, unique passwords, enable two-factor authentication, and only access banking services from secure networks.</li>
</ol>
Conclusion
The growth of neobanking in emerging economies offers a compelling glimpse into the future of finance, blending technology with traditional banking to create innovative solutions that address long-standing barriers. While the risks are not trivial, the potential benefits for economic development and financial inclusion present a strong case for the continued expansion of neobanking services.
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<title>Oil hits 1-week high on demand hopes after China, US data</title>
<link>https://economystandard.com/oil-hits-1-week-high-on-demand-hopes-after-china-us-data/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Thu, 09 May 2024 20:35:15 +0000</pubDate>
<category><![CDATA[Headlines]]></category>
<guid isPermaLink="false">https://economystandard.com/?p=22003</guid>
<description><![CDATA[Oil hits 1-week high on demand hopes after China, US data By Scott DiSavino NEW YORK (Reuters) -Oil prices rose about 1% to a one-week high on Thursday after data…]]></description>
<content:encoded><![CDATA[<h2>Oil hits 1-week high on demand hopes after China, US data</h1>
By Scott DiSavino
NEW YORK (Reuters) -Oil prices rose about 1% to a one-week high on Thursday after data from China and the U.S. signalled that demand in the world’s two biggest crude-consuming nations could climb higher.
Brent futures rose 40 cents, or 0.5%, to $83.98 a barrel by 11:03 a.m. EDT (1503 GMT), while U.S. West Texas Intermediate crude rose 46 cents, or 0.6%, to $79.45.
That put both crude benchmarks on track for their highest closes since April 30.
In China, crude oil imports rose on the previous year in April, and exports and imports returned to growth last month, signalling an encouraging improvement in demand at home and overseas as Beijing navigates numerous challenges in an effort to shore up a shaky economy.
“The improved China trade balance data added to the upside momentum,” said Tina Teng, an independent market analyst.
In the U.S., the number new claims for unemployment benefits rose last week to the highest level in more than eight months, further evidence that the labor market was cooling.
Analysts projected that ebbing labor market momentum puts two interest rate cuts from the U.S. Federal Reserve this year back on the table.
Lower rates would reduce borrowing costs and could spur economic growth and demand for oil.
Meanwhile, the Bank of England took another step towards lowering interest rates, as a second official backed a cut and Governor Andrew Bailey said he was “optimistic that things are moving in the right direction”.
In the Middle East, meanwhile, Israeli forces massed tanks and opened fire close to built-up areas of Rafah on Thursday, residents said, after U.S. President Joe Biden vowed to withhold weapons from Israel if its forces launch a major invasion of the southern Gaza city.
In response, the leader of the Houthis in Yemen said the Iran-backed group, which has already disrupted the movement of ships through the Red Sea, would target ships of any company related to supplying or transporting goods to Israel regardless of their destination.
(Reporting by Scott DiSavino in New York, Paul Carsten in London, Deep Vakil in Bengaluru, Laila Kearney in New York and Emily Chow in Singapore; Editing by Mark Potter, Kirsten Donovan, and Marguerita Choy)
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<title>Bank of England clears path for its first rate cut since 2020</title>
<link>https://economystandard.com/bank-of-england-clears-path-for-its-first-rate-cut-since-2020/</link>
<dc:creator><![CDATA[Staff GBAF Publications Ltd]]></dc:creator>
<pubDate>Thu, 09 May 2024 20:34:31 +0000</pubDate>
<category><![CDATA[Headlines]]></category>
<guid isPermaLink="false">https://economystandard.com/?p=21998</guid>
<description><![CDATA[Bank of England clears path for its first rate cut since 2020 By William Schomberg, David Milliken and Suban Abdulla LONDON (Reuters) -The Bank of England paved the way on…]]></description>
<content:encoded><![CDATA[<h2>Bank of England clears path for its first rate cut since 2020</h1>
By William Schomberg, David Milliken and Suban Abdulla
LONDON (Reuters) -The Bank of England paved the way on Thursday for the start of interest rate cuts as soon as next month and Governor Andrew Bailey said there could be more reductions than investors expect.
The BoE’s Monetary Policy Committee kept rates at a 16-year high of 5.25% but Deputy Governor Dave Ramsden joined external MPC member Swati Dhingra in backing a cut to 5%, the central bank said.
Economists polled by Reuters had mostly expected an 8-1 split to keep rates on hold.
British government bond yields fell and sterling briefly dipped against the dollar.
After cutting rates in March 2020 as the coronavirus pandemic swept the world, the BoE began raising borrowing costs in December 2021 – earlier than other leading central banks – to counter high inflation which peaked at 11.1% in October 2022.
Headline inflation has since fallen back and the BoE expects it slowed to around its 2% target in April, largely because of falling energy prices.
The central bank remains on guard because of still-strong growth in wages and services prices which it expects to temporarily push inflation above 2% later this year.
But Bailey sounded hopeful that higher borrowing costs were doing their job.
“We need to see more evidence that inflation will stay low before we can cut interest rates,” he said. “I’m optimistic that things are moving in the right direction.”
Bailey added the BoE might need to cut rates by more than the market expected and it could start at its next scheduled MPC announcement on June 20.
“Let me be clear, a change in Bank Rate in June is neither ruled out nor a fait accompli,” Bailey said.
Investors have been trying to work out whether the BoE is likely to cut rates in June – when the European Central Bank has already signalled it will move – or, like the U.S. Federal Reserve, will hold out longer.
On Wednesday, Sweden’s central bank cut its key interest rate for the first time in eight years.
A cut by the BoE could offer a lifeline to Prime Minister Rishi Sunak who has told voters that the economy is turning a corner but is struggling to reduce the opposition Labour Party’s big opinion poll lead before an election later this year.
Finance minister Jeremy Hunt sought to dispel any sense that the government wanted to pressure the BoE.
“I would much rather that they waited until they’re absolutely sure inflation is on a downward trajectory than rushed into a decision that they had to reverse at a later stage,” he told reporters after the BoE’s announcement.
FOCUS ON THE DATA
In an attempt to spell out its likely next steps, the BoE said it would consider how the upcoming economic data “inform the assessment that the risks for inflation persistence are receding.”
Two official sets of labour market and two rounds of inflation figures are due before June 20.
“We think some soft inflation and wages data may be enough to prompt it to cut rates at the next meeting in June, if not at the following meeting in August,” Paul Dales, chief UK economist at consultancy Capital Economics, said.
But Hetal Mehta, head of economic research at investment managers St. James’s Place, said: “Any expectations of a rate cut in June would be premature as base effects will only temporarily get inflation down to target.”
The pound fell by about a third of a cent against the U.S. dollar after the BoE’s announcements before rising later.
The yield on two-year British government bonds, which are most sensitive to BoE rate speculation, fell by 4 basis points.
Financial markets priced in a first quarter-point BoE rate cut by August and saw another before the end of the year, little changed on the day.
The BoE sent another message to investors that their bets on rate cuts might be too conservative as it cut its inflation forecasts for two and three years’ time to 1.9% and 1.6% – below its 2% target – from its February projections of 2.3% and 1.9%.
The BoE’s inflation forecasts partly reflect market interest rate expectations in the run-up to its MPC meetings.
“It’s likely that we will need to cut bank rates over the coming quarters and make monetary policy somewhat less restrictive over the forecast period, possibly more so than currently priced into market rates,” Bailey said.
There were differences between the seven MPC members who voted to keep rates on hold around how persistent inflation pressures would be, and how much more evidence of a slowdown was needed to justify a rate cut, minutes of their meeting showed.
Wage growth and services price inflation of around 6% remain higher than in the United States or euro zone, even though British economic growth is more sluggish.
But Ramsden and Dhingra said a cut was needed now because of the time lag in monetary policy decisions impacting the economy and because inflation might fall more than the BoE had forecast.
The BoE slightly lifted its growth forecasts for Britain’s economy, saying it expected 0.5% growth in gross domestic product over 2024, up from 0.25% in its February forecast.
It said a recession in the second half of 2023 had probably ended, offering some relief to Sunak and his struggling Conservative Party.
(Additional reporting by Andy Bruce, Writing by William Schomberg, Graphics by Sumanta Sen, Editing by Jane Merriman)
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