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Sunday, August 12, 2018 (27-04-2075) kathmandupost.ekantipur.com
Turkey lira crashes as Trump piles on pressure
Inside
World Bank to
issue world’s first
blockchain bond
The World Bank is tak-
ing a step into the brave
new world of digital
finance to sell the
first-ever bond to be
issued entirely using
blockchain technology,
the bank announced on
Friday. More than just
funds, the World Bank
aims to gain experience
using blockchain—a dig-
ital public registry of
transactions—that
could lead to “a golden
future” for financial
services for developing
nations, a bank official
told AFP.The technology
is most often associated
with cryptocurrencies—
like bitcoin—which
often raise suspicion
about their reliability
and volatility, as well as
their use for criminal
purposes. But because
there as yet is no central
bank-backed digital cur-
rency in existence, the
two-year blockchain
bond will rely on real-
world money: Australian
dollars. The Washington-
based development lend-
er aims to raise about
Aus$50 million (about
$36 million), although it
could be double that if
more investors get
involved before the bond
is finalised the week of
August 20. Pg: II
Nepal, SKorea
seek to boost
bilateral tourism
The Embassy of the
Republic of Korea and
Korea Tours and
Trekking Operators
Association of Nepal
(KTTOAN) have signed a
Memorandum of
Understanding (MoU) on
mutual cooperation for
boosting tourism ties
between Nepal and
South Korea. The MoU
aims to ensure safety
and security of Korean
tourists visiting the
Himalayan nation. The
MoU was signed by the
ambassador of South
Korea to Nepal Park
Young-sik and KTTOAN
President Amar
Bahadur Shahi amidst a
ceremony organised in
Kathmandu on
Thursday, on behalf of
their respective organi-
sations. As per the MoU,
the two organisations
will help enhance the
friendly people-to-people
ties between Nepal and
South Korea and con-
tribute to promoting
bilateral tourism. In
2017, as many as 34,000
Korean tourists visited
Nepal. Currently, Korean
Air operates four weekly
fights between Nepal
and South Korea. Pg: III
Nepse index
posts loss of
10.68 points
Nepal Stock Exchange
(Nepse) index shed
10.68 points to close at
1,180.63 points last week,
as investors continued
to stay away from the
country’s only
secondary market due
to banks’ charging high
interest rates. The
bearish trend in Nepse
saw the average daily
turnover amount plung-
ing to a mere Rs183.74
million, down from
Rs215.44 million in the
previous week. The mar-
ket index performed
abysmally during the
review period, posting
losses during all five
trading days. Nepse
lost 1.41 points on
Sunday to close at
1,189.88 points. The
index went down by 0.21
points, 1.46 points and
0.89 points on Monday,
Tuesday and Wednesday
respectively. On
Thursday, the market
dropped 6.69 points.  Pg: IV
Bhairahawa airport may be
operated by private sector
POST REPORT
KATHMANDU, AUG 11
The government may make
first airport deal under the
public-private partnership
(PPP) programme to operate
Gautam Buddha International
Airport in Bhairahawa, going
against the tradition that air-
ports should be owned, man-
aged and operated by the gov-
ernment.
Located in south central
Nepal, the airport is the gate-
way to the international pil-
grimage destination of
Lumbini, the birthplace of
Gautam Buddha. It is in the
process of being upgraded to
an international airport, and
the project is expected to be
completed by June 2019.
In response to the view
asked by the Finance Ministry
on whether PPP deal would be
appropriate in the context of
Nepal, the National Planning
Commission (NPC) said it
would be wise to induct trusta-
ble domestic or international
investment under the PPP
model.
The NPC, the apex advisory
body of the government for
formulating periodic plans
and policies, said that after the
airport is constructed and if
the existing government’s
resources are not adequate,
the airport operation could be
entrusted to the private. “The
grape picking
n Touristspick grapes in a vineyard in Lujiapu Village of Fuyang District in Hangzhou, east China’s Zhejiang Province, on Saturday. According to customs statistics, China’s
export volume of fresh grapes reached 25.48 million tonnes in 2017 worth $664 million.
Plan to install power lines underground hits a snag
BIBEK SUBEDI
KATHMANDU, AUG 11
Nepal Electricity Authority’s
plan to replace overhead
electric cables with power
lines underground at two
locations in the Kathmandu
Valley has hit a snag. The
project’s financier, Asian
Development Bank (ADB), is
threatening to pull back
from the project if the power
utility fails to wrap up the
bidding process immediately
and appoint contractors for
the job.
The ADB’s warning came
at the time when the Nepal
Electricity Authority (NEA)
was planning to scrap the
ongoing tender and initiate
new procurement process to
appoint contractors after
bidders quoted prices that
exceeded the estimates.
The NEA had invited two
separate global tenders to
appoint a contractor to lay
cables underground in areas
served by the Maharajgunj
and Ratna Park distribution
centres in July and August
private sector should be
inducted through open compe-
tition,” the NPC letter
obtained by the Post reads.
The planning body has
asked the government to be
clear on sharing the risks and
benefits of the project, the role
of the private sector, national
and international airport
operating laws, quality assur-
ance and safety and security at
the airport before inducting
private investment.
According to the Tourism
Ministry officials, private cap-
ital in airports around the
world has delivered signifi-
cant benefits for passengers,
airlines and the government.
According to a World Bank
report, approximately 19 per-
cent of airports in the world
The project’s financier, Asian Development Bank, is
threatening to pull back from the project if the power
utility fails to wrap up the bidding process immediately
and appoint contractors for the job
2017. The NEA has decided
to lay electricity cables
underground and remove
overhead lines in a bid to
improve the distribution sys-
tem. This is a component of
the $180-million Power
Transmission and
Distribution Efficiency
Enhancement Project
(PTDEEP) funded by the
Nepal government and the
ADB.
Out of the nine firms
interested in executing each
of the contracts, two Indian
firms—Larsen and Turbo
and KEI Industries—were
the lowest bidders for the
Maharajgunj and Ratnapark
area respectively.
However, as the price quot-
ed by the Indian firms
exceeded the cost estima-
tions of the NEA by around
Page II The embattled Turkish lira tumbled over 16 percent to new record lows against the dollar as strains with the US
intensified, but President Erdogan defiantly proclaimed Turkey would emerge victorious in an ‘economic war’.
According to the Tourism Ministry officials, private capital
in airports around the world has delivered significant
benefits for passengers, airlines and the government
are PPPs, accounting for 30
percent of total passengers. In
India, the government has
developed new airports or
modernised existing airports
in several cities on a PPP
basis. In Nepal, what has made
the government think that it is
time to involve private players
in airport operation and man-
agement? Many officials point
to a chaotic Tribhuvan
International Airport (TIA)
and its infrastructure hurdles
as the inspiration to reach out
to the private sector.
The government is under
ca b l e m a n ag e m e n t
25 percent, the power utility
wants to scrap the ongoing
procurement process and
call new tenders, according
to a highly placed source at
the NEA.
“The ADB, however,
doesn’t want us to call new
tenders and have warned us
that it will not fund the pro-
ject if new tenders are initi-
ated. It wants us to negotiate
with the two Indian firms
and award them the con-
tracts,” said the source. “The
multilateral lender says that
if fresh tender is called, it
will take more time which
will ultimately increase the
cost of the project.”
The NEA management
fears that if they appoint the
contractors at the current
bidding prices, the decision
will face public criticism.
cross currency F ORE X
USD EUR JPY GBP CHF CAD AUD INR NR US Dollar 110.43
NR 110.4300 126.5100 0.9950 140.9900 111.0600 84.3200 80.7300 1.6015 Euro 126.51
INR 68.8300 78.8380 0.6202 87.8750 69.2040 52.5500 50.3010 0.6244 Pound Sterling 140.99
Japanese Yen 1.00
GBP 0.7833 0.8970 0.0071 0.7874 0.5979 0.5724 0.0114 0.0071
Chinese Yuan 16.11
JPY 110.9100 127.0800 140.8451 111.5500 84.7100 81.1000 1.6125 1.0050
Qatari Riyal 30.33
EUR 0.8727 0.0079 1.1148 0.8774 0.6664 0.6378 0.0127 0.0079
Australian Dollar 80.73
USD 1.1459 0.0090 1.2767 1.0053 0.7635 0.7310 0.0145 0.0091
Malaysian Ringit 27.03
How to read the table
The chart shows the rates of nine world currencies. Move across the table to find rates of exchange between any two
currencies. One unit of the currency mentioned horizontally is worth that amount in the currency mentioned vertically.
Saudi Arab Riyal 29.44
Exchange rates fixed by Nepal Rastra Bank
Tourism Ministry official.
The proposed Integrated
Civil Aviation Bill has also
envisaged allowing the private
sector to build and operate air-
ports. A draft of the new law
looks kindly at potential pri-
vately operated airports, and
Dairy farmers
it has also simplified the pro-
cess for the government to pri-
vatise its existing airports.
The growth of Nepal’s air
transport industry can be
in Chitwan
traced back to 1992 when the
aviation policy was liberal-
ised. Aircraft movement, both
domestic and international,
jumped more than fourfold
set to protest
from 24,600 in 1992 to 126,469 in
2017, according to TIA statis-
tics.
Liberalisation in Nepal’s
aviation scene opened the door
for private operators, and a
swarm of airlines entered the It is the first protest in nearly eight
years by dairy farmers
heavy pressure to improve the Nepali skies. The aviation sec-
efficiency of its existing sole tor is flying high, but infra-
international airport that is structural hurdles persist, and
managed by the Civil Aviation the service offered by govern- RAMESH KUMAR POUDEL
Authority of Nepal (Caan). ment-managed airports CHITWAN, AUG 11
There are 156 dairy
Besides being known as one remains poor. cooperatives in Chitwan
of the worst airports in the Due to flip-flops in govern- Farmers and milk coopera-
world in terms of comfort, ment policy, the country’s air- tives based in Chitwan have
alone. About 100,000
cleanliness and customer ser- port infrastructure and servic- blamed the Dairy farmers supply milk to
vice, TIA has reached its es have failed to match the Development Corporation
capacity limit. Its infrastruc- pace of the booming airline (DDC) of not being farmer these cooperatives
ture is ill-equipped to deal industry. friendly. The farmers
with the growth in the number The aviation industry has expressed such views during ers refuted the claim, calling
of airlines. “There is an become very attractive for a gathering organised in the such subsidies useless.
urgent need to bring the pri- investors, but its potential district on Friday to launch “We rely on fodder based
vate sector onboard to operate remains constrained by limit- the protest against the DDC’s cattle rearing as encouraged
the country’s airports,” said a ed infrastructure. latest move to slash the com- by the government,” said
mission it was providing to Bhagirath Timilsina, chair-
dairy cooperatives involved in man of Central Dairy
milk collection. Cooperative Association of
Recently the state-owned
corporation slashed the com-
Nepal. “The DDC’s plan
doesn’t align with govern-
mission it was offering to ment’s policy and our prac-
dairy cooperatives from Rs tice.” Other farmers present
6.92 to Rs 3 per litre of milk. in the gathering warned of
Out of the total commission, launching sterner protests if
the cooperatives were offering the authorities failed to
Rs 3 for each litre of milk to address their problem.
farmers while the rest was DDC collects milk from
kept by the cooperatives. around 1,100 dairy coopera-
In the gathering organised tives across the country. It
by Chitwan Milk Producers sells 150,000 litres of milk
Cooperatives Association, daily. DDC holds a 40 percent
participants decided to market share for milk. Last
force the DDC to back track August, the state-owned enter-
from its decision through a prise raised the price of milk
protest. by Rs4-10 per litre, stating that
“We should not resort to around 71 percent of the
violent protest, but we must money would go directly to
force the corporation to back farmers. There are 156 dairy
track from its decision by cooperatives in Chitwan
picketing its offices in alone. About 100,000 farmers
Hetauda and Kathmandu,” supply milk to these coopera-
said Dilli Prasad Thapaliya, tives.
chairman of coordination At present, the country is
committee of Milk Producers experiencing a milk holiday
Cooperatives of Rapti after almost nine years as
Municipality. “Dairy farmers dairies stopped buying milk
have not launched any kind of from farmers citing excess
protest in the last eight years supply. The glut has been
but DDC’s decision has left us attributed to an increase in
with no choice.” the number of milk farmers
While DDC backed its deci- going into commercial pro-
sion saying the lower commis- duction. It has affected milk
XINHUA sion will be used to provide producers in almost all parts
subsidies in cattle feed, farm- of the country.
nStranded wires at Anamnagar, Kathmandu. The Nepal Electricity Authority has decided to lay underground electricity cables and remove
overhead lines in a bid to improve the distribution system.  POST FILE PHOTO
“Although we have to fol- and land us in controversy if financing.” an appropriate decision
low the public procurement we go along with the ADB’s NEA Managing Director soon. The ADB, however,
guideline of the ADB while decision,” said the NEA Kulman Ghising, who refused to comment on the
executing the project under source. “But if we choose to wouldn’t disclose much particular package of
their financing, our decision call new tender, we will not detail about the issue, said PTDEEP saying the procure-
might face lots of criticism get the multilateral lender’s the power utility will make ment process is in progress.
C M Y K
Sunday, August 12, 2018 | the kathmandu post
news digest
Fitch upgrades
Greece’s debt
rating by a notch
WASHINGTON: Credit rat-
ings agency Fitch on
Friday upgraded
Greece’s sovereign debt
one notch to ‘BB-’ from
‘B’ due to the recent
deal with Europe to pro-
vide “substantial” debt
relief. The announce-
ment, which still rates
Greek debt as specula-
tive, followed S&P
Global’s decision last
month to raise its out-
look for Greece to “posi-
tive,” suggesting anoth-
er upgrade could be
coming soon. Athens in
June reached an agree-
ment with its euro area
creditors, allowing a
10-year extension for
repaying much of its
debts, which, at a 180
percent of GDP, are still
the highest in the
European Union. The
agreement will also
allow Greece to exit its
financial bailout pro-
gramme on August 20.
And after graduating
from a European aid
programme, “The debt
relief measures agreed
at the 21 June
Eurogroup are substan-
tial,” Fitch said in a
statement. (AFP)
India’s fuel
demand rose 7.4
percent in July
NEW DELHI: India’s fuel
demand rose 7.4 percent
in July compared with
the same month last
year. Consumption of
fuel, a proxy for oil
demand, totalled 17.06
million tonnes, data
from the Petroleum
Planning and Analysis
Cell (PPAC) of the
oil ministry showed.
Sales of gasoline,
or petrol, were 7.8 per-
cent higher from a year
earlier at 2.31 million
tonnes. Cooking gas
or liquefied petroleum
gas (LPG) sales
increased 6.0 percent to
2.04 million tonnes,
while naphtha sales
surged 60.8 percent to
1.14 million tonnes.
Turkish lira crashes as
Trump piles on pressure
AGENCE FRANCE-PRESSE
ISTANBUL, Aug 11
The embattled Turkish lira
tumbled over 16 percent to
new record lows against the
dollar as strains with the
United States intensified, but
President Recep Tayyip
Erdogan defiantly proclaimed
Turkey would emerge victori-
ous in an “economic war”.
Compounding the lira’s
agony, President Donald
Trump said Friday he had
doubled steel and aluminium
tariffs on Turkey, noting that
relations between the NATO
allies were “not very good”.
The lira’s plunge on Friday
is one of the most serious eco-
nomic crises that Erdogan has
faced since coming to power in
2003 in the wake of a financial
crisis in 2001 that brought the
economy to near meltdown.
“The plunge in the lira
which began in May now looks
certain to push the Turkish
economy into recession and it
may well trigger a banking
crisis,” said Andrew
Kenningham, chief global
economist at Capital
Economics.
The currency turbulence
coincides with the most bitter
dispute with the United States
since the 1974 Turkish inva-
sion of Cyprus, which so far
shows no sign of abating.
Fears over contagion even
pushed global equity markets
lower, with some European
banks coming under heavy
selling pressure due to their
exposure to Turkey.
The lira was trading at 6.47
to the dollar at 1900 GMT, a
loss on the day of 16.6 percent.
Earlier it had fallen as much
as 22 percent.
“The last time I can remem-
ber a currency exploding into
a similar acceleration of
weakness to what we have
seen in the past 24 hours is the
Russian ruble crisis that tran-
spired late in 2014,” said
Jameel Ahmad, head of cur-
0.26
0.24
0.22
0.20
0.18
0.16
Feb 9
Source: Bloomberg
The currency turbulence coincides with the most bitter dispute with the United States
since the 1974 Turkish invasion of Cyprus, which so far shows no sign of abating
rency strategy at FXTM.
The tumult also affected
Wall Street, which finished the
week on a sour note, with the
Dow Jones, S&P 500 and
Nasdaq all finishing down on
Friday.
But Erdogan, who had
remained unusually silent
until now as the lira crisis
mounted, urged Turks to take
matters into their own hands.
“If you have dollars, euros
or gold under your pillow, go to
banks to exchange them for
Turkish lira. It is a national
fight,” he said.
“This will be the response to
those who have declared an
economic war,” he said, blam-
ing Turkey’s woes on what he
described as an “interest rate
lobby” seeking to push the
country to higher rates.
Erdogan had raised eye-
brows Thursday when he
appeared to invoke divine
intervention, saying: “If they
have dollars, we have our peo-
ple, we have our right and we
world
Turkish lira plummets
2018
have Allah!”
Turkey remains at logger-
heads with the United States
over the detention for the last
two years of American pastor
Andrew Brunson and a host of
other issues.
Trump intensified the
alarm on financial markets
with his new tweet doubling
the tariffs, noting for good
measure the lira was sliding
“rapidly downward against
our very strong Dollar!”.
“Our relations with Turkey
are not good at this time!” he
added.
But Erdogan said Turks
should not be alarmed by
exchange rate movements.
“The dollar, the mollar, will
not cut our path,” said
Erdogan, using a figure of
speech he repeatedly uses to
mock something.
Turkey had alternatives
“from Iran, to Russia, to China
and some European coun-
tries”, he added.
Erdogan also Friday held
Lira agains the dollar
Aug 10
telephone talks with Russian
President Vladimir Putin,
discussing economic and
trade issues as well as the
Syria crisis, the Turkish presi-
dency said.
The Turkish foreign minis-
try hit back at Trump’s com-
ments, saying that the “only
result will be harming our
relationship” and vowing
unspecified retaliation.
It added that Trump’s
remarks were “not possible
to reconcile with state
seriousness”.
Markets are deeply con-
cerned over the direction of
domestic economic policy
under Erdogan with inflation
at nearly 16 percent but the
central bank reluctant to raise
rates in response.
UBS chief economist for
EMEA emerging markets
Gyorgy Kovacs said a giant
rate hike of 350-400 basis
points would be “consistent
with real rate levels that in the
past helped to stabilise the
currency” but warned a deal
to normalise ties with the US
may also be needed.
And it remains unclear if
the bank would be willing to
sharply lift rates, with ana-
lysts saying the nominally
independent institution is
under the influence of
Erdogan, who wants low rates
to keep growth humming.
After winning a June elec-
tion with revamped powers,
Erdogan tightened his control
over the central bank and
appointed his son-in-law Berat
Albayrak to head a newly-em-
powered finance ministry.
“President Erdogan’s
strengthened powers under
the new presidential system
have made it increasingly
uncertain whether policymak-
ers will be able to act to stabi-
lise the economy,” said
William Jackson, chief emerg-
ing markets economist at
Capital Economics in London.
Concerns mounted Friday
after a report in the Financial
Times that the supervisory
wing of the European Central
Bank had over the last weeks
begun to look more closely at
eurozone lenders’ exposure to
Turkey.
The report said the situa-
tion is not yet seen as “criti-
cal” but Spain’s BBVA, Italy’s
UniCredit and France’s BNP
Paribas are regarded as par-
ticularly exposed.
Albayrak, who formerly
served as energy minister, on
Friday announced what he has
described as a “new economic
model” for Turkey but
he focused on macro-economic
issues and steered well
clear of tackling the currency
crisis.
The lira’s plunge has fea-
tured remarkably little on
Turkish television channels
and newspapers—most of
which after recent ownership
changes are loyal to the gov-
ernment—with media focus-
ing instead on recent flooding
by the Black Sea.
money
World Bank to
issue world’s first
blockchain bond
AGENCE FRANCE-PRESSE
WASHINGTON, Aug 11
The World Bank is taking a
step into the brave new world
of digital finance to sell the
first-ever bond to be issued
entirely using blockchain
technology, the bank
announced on Friday.
More than just funds, the
World Bank aims to gain expe-
rience using blockchain—a
digital public registry of
transactions—that could lead
to “a golden future” for finan-
cial services for developing
nations, a bank official
told AFP.
The technology is most
often associated with crypto-
currencies—like bitcoin—
which often raise suspicion
about their reliability and vol-
atility, as well as their use for
criminal purposes.
But because there as yet is
no central bank-backed digi-
tal currency in existence, the
two-year blockchain bond will
rely on real-world money:
Australian dollars.
The Washington-based
development lender aims to
raise about Aus$50 million
(about $36 million), although
it could be double that if more
investors get involved before
the bond is finalised the week
of August 20.
“Since our first bond trans-
action in 1947, innovation and
investor satisfaction have
been important hallmarks of
II
our success with leveraging
capital markets for develop-
ment,” World Bank Treasurer
Arunma Oteh said.
“Today, we believe that
emerging technologies, equal-
ly offer transformative, yet
prudent possibilities for us to
continue to innovate, respond
to investor needs and
strengthen markets.”
The transaction is the
brainchild of the World
Bank’s innovation lab, which
has been working on the issue
for nearly a year, together
with the Commonwealth
Bank of Australia.
The institution also part-
nered with Microsoft, which
will ensure the platform and
software are “solid, bug free,
and have no vulnerabilities to
attack,” said Paul Snaith,
manager of the World Bank’s
Treasury Operations Capital
Markets.
He said use of blockchain
could improve transparency,
since it is public, and cut
down on transaction time
since the bonds eventually
will be exchanged instantane-
ously for cash.
For now, though, investors
still have to register and all
cash will be transmitted sepa-
rately from the blockchain
through “normal channels,”
the old fashioned way.
The two-year life of the
blockchain bond will provide
“quite a few learning events
and opportunities,” he said.

Japan, US plan trade

Sales of bitumen, used
for making roads, were
52.7 percent up, while seeking new roads
fuel oil use edged
lower 2.5 percent

meet for September

in July. (REUTERS)
Russia’s economy
grows further in
second quarter
MOSCOW: Russia’s econ-
omy saw year-on-year
growth of 1.8 percent in
the second quarter ben-
efitting from rising oil
prices and despite
increasingly harsh US
sanctions, the national
statistic agency Rosstat
said. Russia’s economy
expanded by 1.3 percent
in the first quarter of
the year compared to
the same period of 2017,
after two years of reces-
sion in 2015 and 2016.
The return to growth
seen in 2017 has contin-
ued this year despite
the announcement in
April of new US
sanctions over Russia’s
alleged meddling in
2016 presidential
elections won by
Donald Trump. Fears
over the currency
caused the ruble to
fall sharply, hitting lev-
els against the dollar
not seen for two years
on Friday, although the
central bank predicted
the volatility would be
temporary. (AFP)
REUTERS
WASHINGTON, Aug 11
Japan’s Economy Minister
Toshimitsu Motegi said on
Friday he had had productive
trade talks with US Trade
Representative Robert
Lighthizer and that they
planned to meet again in
September.
He said both acknowledged
the importance of expanding
trade between the two nations.
“We agreed to seek ways to
promote Japan-US trade by
working out gaps between the
two nations and expand areas
to cooperate based on shared
understanding,” Motegi told
reporters after two days of
talks in Washington.
“We will continue talks and
proceed further at next meet-
ing we plan to hold in
September,” he said.
He said the atmosphere
of the meeting with Lighthizer
was “very good” and
“energetic”.
Motegi also said he and
Lighthizer exchanged views
on individual trade areas but
nothing had been decided.
The US Trade
Representative’s office said in
The US wants a bilaterak
free trade agreement but
Tokyo is wary as it will put
pressure on markets
a statement that the two sides
had “frank discussions” on
their respective views about
trade and investment, and
achieved a better understand-
ing of each other’s positions.
“Based on these discus-
sions, both sides agreed to
explore ways to fill the gap
between their positions and to
promote trade between the
United States and Japan,
and expand areas of
cooperation based on
common understanding,”
USTR said, adding that the
next round of “consultations”
would be held sometime in
September.
The talks launched a round
of what the two sides call
“free, fair and reciprocal”
negotiations.
They fall within broader
bilateral economic discus-
sions led by Vice President
Mike Pence and Deputy Prime
Minister Taro Aso.
US President Donald
Trump wants a bilateral free
trade agreement but Tokyo is
wary because such an agree-
ment would boost pressure to
open sensitive markets such
as agriculture.
Japan went into the talks
aiming to avert steep tariffs on
its car exports threatened by
Trump while fending off US
demands to engage in bilater-
al talks towards a bilateral
free trade agreement.
Trump has complained
about Japan’s $69 billion trade
surplus with the United
States, and the inability of
American car makers to sell
significant volumes in Japan.
But Trump’s “Section 232”
national security investiga-
tion into automotive imports
could lead to tariffs of 25 per-
cent on imported cars, includ-
ing those from Japan, and has
raised concerns that such a
move would harm the
Japanese, European and US
economies.
Japan also has urged
Washington to return to the
multilateral Trans-Pacific
Partnership deal after Trump n Cars to be exported sit at a port in Lianyungang, Jiangsu province, China. Nearly 900,000 vehicles were exported from China in 2017.
withdrew the United States  REUTERS
from the trade pact last year.

eco n o m i c m ov e

Free-trade pacts hamper India’s efforts to curb China textile imports

REUTERS
MUMBAI/NEW DELHI, AUG 11
China is exporting textiles to
India through Bangladesh to get
around a tax increase on imports,
undermining New Delhi’s efforts
to support local manufacturers,
industry sources said.
Earlier this week, India dou-
bled the import tax on more than
300 textile products to 20 percent,
marking the second tax increase
on textiles in as many months.
This is aimed at providing
relief to the country’s domestic
textile industry, which has been
hit by cheaper imports. India’s
total textile imports jumped by 16
percent to a record $7 billion in
the fiscal year to March 2018. Of
this, about $3 billion were from
China.
Textiles are India’s second
largest job provider directly
employing nearly 51 million peo-
ple and accounting for 5 percent
of India’s gross domestic prod-
uct, and 13 percent of its export
earnings.
Industry officials said textile
raw material from China is com-
ing into India via Bangladesh,
which has a free-trade agreement
with India giving it access to the
country’s $100 billion textile mar-
ket. “Duty free fabric from China
is coming to Bangladesh, getting
converted and landing into India
at zero duty,” Sanjay Jain, presi-
dent of Confederation of Indian
Textile Industry (CITI) told
Reuters.
Industry bodies argue that
India’s latest action is not enough
to protect domestic garment
manufacturers which are facing
fierce competition from China
er of ready-made garments -rose
over 43 percent to $200.9 million
during the year ended March
2018, according to Indian govern-
ment data.
“Import trends suggests 40 to
50 percent of the garments were
made with Chinese fibre,” said an
Indian analyst who did not want
to be named. It is difficult to esti-
mate exactly how many garments
imported in India were produced
with fibre sourced from China, he
said.
n A woman works at a textile mill in Mumbai, India.  reuters India, Bangladesh and Sri
Lanka are among the signatories
Textiles are India’s second largest job provider directly employing of the South Asian Free Trade
Agreement (SAFTA) that created
nearly 51 million people and accounting for 5 percent of India’s a free-trade zone in the South
gross domestic product, and 13 percent of its export earnings Asian region.
Shipments of edible oils com-
ing into India are also being des-
and Bangladesh. and apparel from Bangladesh - ignated as duty free under the
Imports of clothing accessories the world’s second largest export- regional free-trade pact, circum-
venting an import tax increase.
Trade bodies, which expect tex-
tile imports from Bangladesh to
rise further, have asked the gov-
ernment to introduce a rule of
origin for duty free imports.
Competition from China is forc-
ing some businesses, such as pol-
yester production facilities, to
run idle, leading to job losses,
they said.
“Under the SAFTA agreement
and trade agreement with
Bangladesh, only those goods
should be exempted from custom
duty, whose raw material is also
manufactured by one of the
SAFTA countries,” Dilip Chenoy,
head of The Federation of Indian
Chambers of Commerce and
Industry said in a letter dated
July 25 to a senior official in the
government’s textile ministry.
Kavita Gupta, India’s textile
commissioner told Reuters: “The
textile ministry has proposed a
‘Fabric Forward Policy,’ where
duty free access to garments will
be provided if the fabric is
sourced from India. The policy is
in discussion stage.”
Rising imports sent India’s
trade deficit with China in textile
products (finished garments) to a
record high $1.54 billion in
2017/18, alarming industry offi-
cials as India had been until
recently a net exporter of textile
products to China.
There is a 10 percent price dif-
ference on average between tex-
tile products made in India and
those made in China, according
to FICCI. The unit value of some
Chinese products such as stock-
ings, blouses and baby garments
cost far less than produced
in India.

C M Y K
III money economy the kathmandu post | Sunday, August 12, 2018

Nafta talks drag on

news digest
SBI eyes return
to profitability
in third-quarter
NEW DELHI/BENGALURU:
State Bank of India is
confident of returning
to profitability from the
December quarter
onwards as the impact
of bad loans eases, its
chairman said after the
nation’s top lender by
assets plunged to its
third straight quarter
of losses. India’s banks
have been plagued by a
surge in non-perform-
ing loans which hit a
record $150 billion at
the end of March.
Twenty-one lenders led
by SBI, in which the
Indian government
owns a majority stake,
accounted for 86 per-
cent of the pile. SBI’s
gross non-performing
loans eased quarter on
quarter to 2.13 trillion
rupees ($30.8 billion) by
the end of June, while
provisions for bad loans
also fell sharply. But
lower trading income
and treasury losses
meant the lender, which
accounts for about a
fifth of India’s banking
assets, reported a 48.76
billion rupee ($707.28
million) net loss for its
fiscal first quarter end-
ing June. (REUTERS)
Canada adds
54,000 jobs
in July
OTTAWA: Canada added
54,000 net jobs in July,
pushing the unemploy-
ment rate down
0.2 percentage points
REUTERS
WASHINGTON, Aug 11
Talks between the United
States and Mexico over the
future of the North American
Free Trade Agreement were
set to drag into next week, as
auto industry officials said on
Friday that new sticking
points had emerged over
President Donald Trump’s
threat to impose steep automo-
tive tariffs.
Auto industry officials
familiar with the talks said
the Trump administration
wants the ability to impose
national security tariffs on
future Mexican production
from new auto assembly and
parts plants.
These officials said U.S
negotiators had essentially
agreed that a new Nafta trade
deal would exempt existing
Mexican auto plants from any
“Section 232” tariffs that
Trump may impose.
But the US negotiators do
not want to apply the same
guarantees to new Mexican
auto plants, the officials said,
as the potential threat of 25
percent tariffs would discour-
age new automotive invest-
ment in Mexico to serve the
US market.
At Trump’s direction, the
Commerce Department in
May launched a probe into
whether imports of cars,
trucks and auto parts pose a
national security risk, invok-
ing the same 1962 trade law
used to justify broad tariffs on
steel and aluminum—includ-
ing those imposed on Canada
and Mexico.
n US Trade Representative Robert Lighthizer (right) embraces
Mexican Economy Minister Ildefonso Guajardo during a joint news
conference in Mexico City, Mexico. REUTERS
Administration officials
and congressional aides have
said the car tariff probe, like
the metals tariffs, in part is
aimed at winning concessions
during ongoing Nafta renego-
tiation talks.
Trump late on Friday tweet-
ed that a “deal with Mexico is
coming along nicely.
Autoworkers and farmers
must be taken care of or there
will be no deal,” adding that
Mexican president-elect
Andres Manuel Lopez
Obrador “has been an abso-
lute gentleman.”
Trump added that Canada
“must wait” to rejoin the
Nafta talks. “Their Tariffs and
Trade Barriers are far too
high. Will tax cars if can’t
make a deal!” Trump tweeted.
Adam Austen, a spokesman
for Canadian Foreign Minister
Chrystia Freeland, who is
leading Nafta trade talks for
Canada, said the minister was
in regular contact with her
Mexican and US counterparts.
“We’re glad Mexico and the
US continue to work out their
bilateral issues. It’s the only
way we’ll get to a deal,” Austen
said.
Mexican Economy Minister
Ildefonso Guajardo told
reporters in Washington on
Friday his talks with US Trade
Representative Robert
Lighthizer would resume next
week, but there were still
many bilateral issues to work
out before Canada could rejoin
the talks.
Asked about progress on
autos rules of origin, he said:
“Nothing is close until
everything is close, but there
are items in every element
that is being discussed.”
Guajardo said that once
bilateral US-Mexican issues
were resolved, Canada could
rejoin the talks to work on
tri-lateral issues. He said this
innovation cities index
Tokyo tops list of world’s
most innovative cities
could take place in “the next
few days or weeks.”
Industry officials also said
the US team had barely
moved from its demands last
May of a 75 percent
overall regional content
threshold with 40-45 percent
content from high-wage
zones—effectively the United
States and Canada—with
the only substantial
change a slightly longer
phase-in time.
The automotive officials
said that Mexico had sought
reassurances that new content
rules would not cause losses
of existing facilities or jobs in
the sector and that a Nafta
deal would make Mexico
immune to any automotive
tariff Trump imposes on
national security grounds. n People walk on a street in a busy shopping district in Tokyo, Japan.  REUTERS
But the US side was sticking
to a hard stance in the final REUTERS the annual ranking. Francisco Bay Area.
stretch of the year-old Nafta LONDON, Aug 11 “They showed clear direc- “We found on a popula-
talks, trying to extract conces- tion by embracing smart tech- tion-adjusted basis many
sions as another late August Tokyo topped a list of the nology change to lead innova- small cities are punching
deadline for a deal approach- world’s most innovative cities tion and leadership in what above their weight. It’s the
es, one industry representa- on Friday, leapfrogging we have identified as the twin year of big cities with physi-
tive said. London and New York after long-term globe-shaking cal networks and small cities
The issues the two coun- embracing the “globe-shaking trends of robotics and 3D with digital networks,” said
tries are hammering out trends of robotics and 3D manufacturing.” Hire in a statement.
include what percentage of manufacturing”. Singapore, Sydney and London ranked second after
auto industry components The Japanese capital has Seoul also ranked highly in losing the top spot to Tokyo as
need to be made in North risen rapidly since entering the index, which judges cities Europe lost ground, scoring
America to avoid tariffs, and the top 10 of the Innovation on 162 indicators including fewer cities in the top 100 than
how many cars and trucks Cities Index three years ago web censorship, wealth distri- in previous years.
need to be made in factories behind Paris, and was one of bution and the potential for Japan has built a reputa-
paying higher wages. three Asian cities to feature green businesses. tion as an early adopter of
The US-Mexico talks for a
reworked North American
this year.
“What really surprised us
San Francisco and New
York both made the top five,
new technologies.
It recently launched facial
Free Trade Agreement this year was the resurgence while smaller US cities such recognition technology ahead
resumed three weeks ago, of Tokyo, moving up to eclipse as San Diego, Portland and of the Tokyo 2020 Olympic
without Canada, after negotia- rival cities like Boston,” said Oakland featured highly, Games and has invested in
tions involving all three mem- Christopher Hire, director of demonstrating their attrac- artificial intelligence for vehi-
bers of the $1.2 trillion trade commercial data provider tiveness to tech companies cles, hospitals and financial
bloc stalled in May. 2thinknow, which publishes priced out of the San services.

US budget deficit swells

to 5.8 percent, the

Nepal, South Korea seek

government said Friday.
The increase in
employment was driven

to $76.9 billion in July

by the public sector, and
all of the new jobs were

to boost bilateral tourism

part-time, while 28,000
full-time jobs were
shed in the month, said
Statistics Canada.
“We’ll need to take
the numbers with a
grain of salt,”
commented CIBC
Economics analyst
Royce Mendes. “While a
big increase in jobs
brings this series more
in line with what we’ve
seen from other indica-
tors this year, the
details leave us some-
what skeptical that the
move won’t be at least
partly reversed in
August,” he said in a
research note. (AFP)
Verizon workers
approve new
four-year deal
NEW YORK: The union
that represents many
Verizon Communi-
cations Inc employees
announced the ratifica-
tion of a four-year
extension of their
labour contracts on
Friday, paving the way
for an 11.2 percent
increase in wages over
the four years. Verizon
and the union workers
agreed to the deal well
in advance of the cur-
rent contracts’ expira-
tion in August 2019,
seeking to avoid
another conflict that
prompted strikes in
2016. The new contracts,
which cover 34,000
employees in northeast
and mid-Atlantic
regions served by the
largest US wireless net-
work, also include
better retirement bene-
fits, the Communi-
cations Workers of
America said in a
statement. (REUTERS)
ASSOCIATED PRESS
WASHINGTON, AUG 11
The federal government
racked up a $76.9 billion defi-
cit in July, with increased gov-
ernment spending and tax
cuts keeping the country on
track to record its biggest
annual deficit in six years.
The Treasury Department
reported on Friday that in the
first 10 months of this budget
year, the deficit totaled $684
billion, up 20.8 percent from
the same period last year.
Revenues are up only 1 per-
cent this year, the increase
held back by a big drop in
corporate tax payments.
Spending is up 4.4 percent,
travel disruption
n Planes of Irish low cost airline Ryanair are seen standing on the airfield at the Frankfurt-Hahn
Airport in Hahn, western Germany, as pilots of the company staged a strike. Ryanair pilots across
Europe staged their first simultaneous strike as they ramped up a battle for better pay and condi-
tions, plunging tens of thousands of passengers into travel chaos during the busy summer season. 
 afp/rss
reflecting a big boost Congress
approved earlier this year for
domestic and military pro-
grammes and the rising costs
of financing the debt.
The Trump administration
last month sharply revised
upward its deficit estimates,
projecting annual deficits will
once again top $1 trillion next
year. For the current budget
year, which ends Sept. 30, the
administration is now project-
ing a deficit of $890 billion.
That would be up 33.7 percent
from last year’s deficit of
$665.8 billion.
The administration’s July
estimates project that the defi-
cit will top $1 trillion in 2019,
climbing to $1.1 trillion that
year, and remaining above $1
trillion for three years.
The only other period when
the federal government ran
deficits above $1 trillion was
for four years from 2009
through 2011. That’s when the
Obama administration was
using tax cuts and increased
spending, along with support
for the banking system, to
combat the 2008 financial cri-
sis and Great Recession, the
worst economic downturn
since the Great Depression of
the 1930s. Friday’s monthly
budget report showed that
over the past 10 months, cor-
porate taxes are down 20 per-
cent—$55 billion—from the
same period a year ago.
POST REPORT
KATHMANDU, AUG 11
The Embassy of the Republic
of Korea and Korea Tours
and Trekking Operators
Association of Nepal
(KTTOAN) have signed a
Memorandum of
Understanding (MoU) on
mutual cooperation for
boosting tourism ties
between Nepal and South
Korea. The MoU aims to
ensure safety and security of
Korean tourists visiting the
Himalayan nation.
The MoU was signed by
the ambassador of South
Korea to Nepal Park Young-
sik and KTTOAN President
Amar Bahadur Shahi amidst n South Korea Ambassador to Nepal Park Young-sik (left) and Korea Tours and Trekking Operators
a ceremony organised in Association of Nepal President Amar Bahadur Shahi exchange the MoU.
Kathmandu on Thursday, on
behalf of their respective In 2017, as many as 34,000 Korean tourists visited planning to start flights to
organisations. Korea.
As per the MoU, the two Nepal. Currently, Korean Air operates four weekly fights Chief Executive Officer of
organisations will help Nepal Tourism Board (NRB)
enhance the friendly peo-
between Nepal and the South Korea Deepak Raj Joshi said that
ple-to-people ties between the MoU would be instru-
Nepal and South Korea and Nepalis and organise tours Speaking at the signing mental in bilateral tourism
contribute to promoting for family members of ceremony, Ambassador Park promotion and safety of
bilateral tourism. workers working in Korea suggested that Nepal tourists.
The two sides will hold a under the Employment should develop a software KTTOAN President Shahi
series of discussions, share Permit System (EPS) to for the safety of tourists said that the number of
knowledge and materials Korea and discourage illegal together with the develop- Korean tourists visiting
resources and devise safety immigration of Nepalis into ment of hotels and other Nepal is increasing annually
and security measures for Korea. infrastructures. with the Himalayan
Korean nationals visiting Similarly, the two sides Stating that eight Korean nation being their favourite
Nepal for the purposes of will work together for tourists lost their lives while destination.
trekking. The two sides will enhancing communication travelling to Nepal this year, “Through this MoU, we
establish and operate emer- and understanding between he called for taking are hoping to make their
gency disaster evacuation Korean and Nepali nationals necessary measures for journeys to Nepal much easi-
centres on major trekking and organise cultural and ensuring safety and security er, safer and memorable,”
routes in Nepal and carry tourism promotion pro- of visitors. Shahi said.
out rescue operations in grammes and help promote In 2017, as many as 34,000 The embassy of South
case of accidents in the Korean cuisine, K-Pop and Korean tourists visited Korea, in association with
mountain region. tourism fairs. They will also Nepal. Currently, Korean Air KTTOAN, has assigned 11
The two organisations will extend cooperation to third operates four weekly fights lodges from various trekking
also work together to pro- parties for activities aimed between Nepal and South regions of Nepal to help
mote South Korea as a tour- at invigorating and promot- Korea. Nepal Airlines Korean tourists in case of
ist destination among ing bilateral tourism. Corporation (NAC) is also emergency situation.

regaining control

Tech giants still stumbling in the social world they created

ASSOCIATED PRESS
NEW YORK, AUG 11
Who knew connecting the world
could get so complicated? Perhaps
some of technology’s brightest
minds should have seen that com-
ing.
Social media bans of conspira-
cy theorist Alex Jones have thrust
Facebook, YouTube, Twitter and
others into a role they never
wanted—as gatekeepers of dis-
course on their platforms, decid-
ing what should and shouldn’t be
allowed and often angering
almost everyone in the process.
Jones, a right-wing provocateur,
suddenly found himself banned
from most major social platforms
this week, after years in which he
was free to use them to promul-
gate a variety of false claims.
Twitter, which one of its execu-
tives once called the “free speech
wing of the free speech party,”
remains a lonely holdout on
Jones. The resulting backlash
suggests that no matter what the
tech companies do, “there is no
way they can please everyone,” as
Scott Shackelford, a business law
and ethics professor at Indiana
University, observed.
Facebook’s Mark Zuckerberg,
Twitter’s Jack Dorsey and crew,
and Google’s stewards of
YouTube gave little thought to
such consequences as they built
their empires with lofty goals to
connect the world and democra-
tise discourse. At the time, they
were the rebels aiming to bypass
the stodgy old gatekeepers—
newspaper editors, television pro-
grammers and other establish-
ment types—and let people talk
directly to one another.
“If you go back a decade or so,
the whole idea of speech on social
media was seen as highly positive
light,” said Tim Cigelske, who
teaches social media at Marquette
University in Wisconsin. There
was the Arab Spring. There were
stories of gay, lesbian and trans-
gender teens from small towns
finding support online. At the
same time, of course, the compa-
nies were racing to build the larg-
est audiences possible, slice and
dice their user data and make big
profits by turning that informa-
tion into lucrative targeted adver-
tisements. The dark side of
untrammeled discourse, the
thinking went, would sort itself
out as online communities mod-
erated themselves, aided by
fast-evolving computer algo-
rithms and, eventually, artificial
intelligence.
“They scaled, they built, they
wanted to drive revenue as well
as user base,” said technology
analyst Tim Bajarin, president of
consultancy Creative Strategies.
“That was priority one and con-
trolling content was priority two.
It should have been the other way
around.”
That all got dicier once the
election of President Donald
Trump focused new attention on
fake news and organised misin-
formation campaigns—not to
mention the fact that some of the
people grabbing these new
social-media megaphones were
wild conspiracy theorists who
falsely call mass shootings hoax-
es, white nationalists who organ-
ise violent rallies and men who
threaten women with rape and
murder.
While the platforms may not
have anticipated the influx of
hate speech and meddling from
foreign powers like Russia, North
Korea and China, Bajarin said,
they should have acted more
quickly once they found it. “The
fact is we’re dealing with a brave
new world that they’ve allowed to
happen, and they need to take
more control to keep it from
spreading,” he said.
That’s easier said than done, of
course. But it’s particularly diffi-
cult for huge tech companies to
balance public goods such free
speech with the need to protect
their users from harassment,
abuse, fake news and manipula-
tion. Especially given that their
business models require them to
alienate as few of their users as
possible, lest they put the flood of
advertising money at risk.
“Trying to piece together a
framework for speech that works
for everyone—and making sure
we effectively enforce that frame-
work—is challenging,” wrote
Richard Allan, Facebook’s vice
president of policy, in a blog post
Thursday.
“Every policy we have is
grounded in three core principles:
giving people a voice, keeping
people safe, and treating people
equitably. The frustrations we
hear about our policies—outside
and internally as well—come
from the inevitable tension
between these three principles.”

C M Y K
Sunday, August 12, 2018 | the kathmandu post
Nepse posts loss of 10.68 points
Weekly Stock Review
1191.31
Nepse
index 1189.88
sun (opening) sun (closing)
251.15
250.97
Sensitive
index
sun (opening) sun (closing)
Trading
Amount 191.74 213.79
Rs in m sun mon
Top 5 companies
(trading amount Rs in million)
Progressive Finance Ltd
(promoters’ shares) 59.04
Nepal Life Insurance 41.83
First Microfinance
Development Bank 30.6
Chhimek Laghubitta Bittiya
Sanstha 30.21
Sanima Mai Hydropower 24.62
bizline
CreditAccess Grameen $164 million
IPO subscribed over two times
MUMBAI: Indian micro lender CreditAccess Grameen
Ltd’s initial public offering (IPO) to raise 11.31 billion
rupees ($164.08 million) was subscribed more than 2
times on the final day of sale on Friday. Investors bid
for 41.7 million shares, 2.2 times the 18.8 million shares
on offer, according to stock exchange data as of 1313
GMT. The IPO included new shares of 6.3 billion rupees,
while promoter CreditAccess Asia N.V was also paring
its stake. CreditAccess Grameen, which provides finan-
cial services to the rural poor and low-income house-
holds, particularly women, had set a price range of 418
rupees to 422 rupees a share for the IPO. Anchor inves-
tors have already agreed to buy 3.39 billion rupees
worth of shares as part of the IPO. ICICI Securities,
Credit Suisse Securities, IIFL Holdings and Kotak
Mahindra Capital Company are the book running lead
managers for the issue. (REUTERS)
Papa John’s cuts costs for North
America franchisees as sales fall
KENTUCKY: Papa John’s International Inc on Friday said
it would lower royalties and fees charged to its US and
Canadian franchisees as sales at the US pizza chain
decline following the acrimonious exit of it founder.
The company will cut royalties, food-service pricing and
online fees through 2018, while also funding the
rebranding of the chain. This comes days after the com-
pany said its North American comparable sales for July
had fallen 10.5 percent and would continue falling in the
coming months. Founder John Schnatter resigned as
chairman of the board in July following reports that he
had used a racial slur on a media training conference
call. “We appreciate the assistance being extended to
our franchisees and believe the assistance programme
will help mitigate the impact that the founder’s inexcus-
able words and actions have had on franchisees,”
Vaughn Frey, president of Papa John’s Franchise
Association said in a statement. (REUTERS)
Ericsson to add 300 US jobs as 5G
demand picks up
STOCKHOLM: Mobile telecom equipment maker Ericsson
said on Friday it would add around 300 jobs in the
United States to meet rising demand for next-generation
5G equipment. It said it is aiming to employ engineers
and artificial intelligence specialists. “This is part of an
increase in R&D investment. It doesn’t mean we are cut-
ting (staff) somewhere else to do this,” Chief Executive
Borje Ekholm told Reuters. Many investors expect the
Swedish company to benefit from a new cycle of net-
work upgrades as demand for 5G gear kicks in later this
year or early in 2019, starting in the United States. After
a broad restructuring and clear out of top management,
Ericsson is tackling falling spending on networks by tel-
ecoms operators, but it has added recruits in research
and development in order to be ready to meet eventual
demand for 5G networks. The company, which has
around 95,000 employees worldwide, also said it would
build its first 5G radios in the United States by the end
of this year. Once the world’s biggest supplier of
mobile communications gear, Ericsson competes with
bigger telecom equipment players Huawei of China
and Finland’s Nokia. Nokia last month said it had won
a $3.5 billion deal with T-Mobile, the third biggest US
mobile carrier. (REUTERS)
BMW delays Chinese deliveries of
X4 vehicles to fix brake issue
FRANKFURT: German carmaker BMW on Friday said
around 400 BMW X4 vehicles, built in Spartanburg
South Carolina, are being withheld from delivery to
Chinese customers until a potential brake problem has
been fixed as part of a global safety recall. Cars built
between mid-April and end-June 2018 are being with-
held from sale so that brakes can be fixed as part of a
recall of around 19,000 X3 and X4 vehicles, BMW said.
BMW said it is not aware of any accidents caused by
this issue and said the recall, which started in July, was
triggered by a supplier delivering potentially faulty rear
brake calipers. “We are not handing them over to the
customer until they have rectified the problem,” a BMW
spokeswoman said. Earlier this week a trade dispute
between China and the United States escalated when
Chinese authorities said they would impose additional
tariffs of 25 percent on $16 billion worth of US imports
from steel products to autos. (REUTERS)
stock
POST REPORT
KATHMANDU, AUG 11
Nepal Stock Exchange (Nepse)
index shed 10.68 points to close at
1,180.63 points last week, as inves-
tors continued to stay away from
the country’s only secondary mar-
1189.67 ket due to banks’ charging high
interest rates.
1187.32 The bearish trend in Nepse saw
1188.21 the average daily turnover amount
plunging to a mere Rs183.74 million,
down from Rs215.44 million in the
previous week.
The market index performed
abysmally during the review peri-
1180.63 od, posting losses during all five
trading days. Nepse lost 1.41 points
mon tue wed thu
on Sunday to close at 1,189.88 points.
The index went down by 0.21
250.91
points, 1.46 points and 0.89
250.65 points on Monday, Tuesday and
250.5
Wednesday respectively. However,
on Thursday, the market saw the
largest loss during the review peri-
249.13
od, dropping 6.69 points.
As a result, the market closed
with a downfall of 0.89 percent dur-
ing the review period.
Stockbrokers attributed the fall
in Nepse to low confidence among
large investors to invest in the mar-
mon tue wed thu ket, which was mainly triggered by
high interest rate charged by the
banks. “Although a number of list-
ed companies including commer-
149.19 196.94 918.7 cial banks have unveiled good
financial health according to their
tue wed thu
last fiscal year report, it failed to
attract investors,” said a stockbro-
ker under condition of anonymity.
The sensitive index that meas-
ures the performance of Group ‘A’
Market
companies also went down 2.02
capitalisation
points to close at 249.13 points with
Nepse index  -10.68 Sunday (opening)
the majority of blue chips compa-
Sensitive index -2.02 Rs1,416.70b
nies including commercial banks
Thursday (closing) landing in the red.
Rs1,404.84b Along with a fall in the market
index, the average value of shares
listed on the stock market
also declined by Rs11.86 billion, as
steady workforce
n Filipinos work at the assembly line of Kinpo Electronics factory in Malvar, Batangas in Philippines. The labour force participation rate was estimated at
60.9 percent in April, down from 61.4 percent a year ago by The Philippine Statistics Authority. 
Wa l l St W e e k A h e a d
Wall St falls amid Turkey woes
REUTERS
NEW YORK, Aug 11
US stocks slid on Friday as a
deepening economic crisis in
Turkey dragged on bank stocks
and triggered fears that it could
spread to other global economies.
A drop in technology shares
added to the bearish tone. The
S&P technology index fell 1 per-
cent, with Intel down 2.8 percent
after Goldman Sachs downgraded
the stock to “sell”.
Microchip Technology shares
fell 11.6 percent after disappoint-
ing second-quarter revenue
forecast.
A slump in the Turkish lira
worsened after President Donald n Traders work on the floor of the New York Stock Exchange. 
Trump doubled tariffs on steel
and aluminum imported from said Quincy Krosby, chief market
the country. strategist at Prudential Financial
Investors fled to safe-haven in New Jersey. “You worry about
assets, pushing the dollar higher the collateral damage. You worry
and weighing on US bond yields. about the effects on Europe. You
“It was a classic risk-off move,” have banks losing because the
Stockbrokers attributed the fall in Nepse to low confidence
among large investors to invest in the market, which was mainly
triggered by high interest rate charged by the banks
the market capitalisation fell
to Rs1,404.84 billion from Rs1,416.70
billion.
Seven trading groups shed
points, with life insurance being the
biggest loser, shedding 178.11 points.
It was followed by non-life insur-
ance (94.24 points), manufacturing
(54.78 points) and hydropower (24.36
points). Likewise, the indices of
microfinance also went down by
22.12 points, commercial banks by
7.99 points and finance companies
by 4.94 points.
Of the four gainers, hotels added
the most at 36.49 points to close at
1,844.94 points. ‘Others’ gained 5.01
points, trading gained 4.22 points
while development bank added 3.56
points in its index.
Of the individual companies,
promoters’ shares of Progressive
reuters
10-year US Treasury came down.”
The S&P financial index fell 1.4
percent, among the biggest drags
on the S&P 500. Citigroup, the
most global of the major US
banks, fell 2.7 percent. JPMorgan,
Finance Limited led in terms of
both transaction amount and the
number of traded shares. A total of
585,000 units of the company’s pro-
moters’ shares worth Rs59.04 mil-
lion were traded last week.
Likewise, Nepal Life Insurance
saw a total transaction of its shares
worth Rs41.83 million to finish in
second position, which was fol-
lowed by First Microfinance
Development Bank, Chhimek
Laghubitta Bittiya Sanstha and
Sanima Mai Hydropower.
Last week, stocks of 181 listed
companies were traded. Along with
a fall in market index, the transac-
tion amount also declined by 14.68
percent to Rs918.73 million. The
traded number of shares also went
down to 3,647,840 units from
4,084,520 units.
REUTERS
Wells Fargo and Bank of America
were also lower.
The Dow Jones Industrial
Average was down 270.25 points,
or 1.06 percent, to 25,238.98, the
S&P 500 had lost 25.21 points, or
0.88 percent, to 2,828.37 and the
Nasdaq Composite had dropped
65.17 points, or 0.83 percent, to
7,826.61.
Shares of trade-sensitive com-
panies also declined, including
Boeing, 3M and Caterpillar, which
were all down at least 1.4 percent.
Data on Friday showed US con-
sumer prices rose in July and the
underlying trend continued to
strengthen, pointing to a steady
increase in inflation pressures.
Declining issues outnumbered
advancing ones on the NYSE by a
2.12-to-1 ratio; on Nasdaq, a 1.47-
to-1 ratio favored decliners.
The S&P 500 posted 12 new
52-week highs and 10 new lows;
the Nasdaq Composite recorded
82 new highs and 88 new lows.
money IV
market watch
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Tomato Big kg Rs65
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Brinjal Long kg Rs55
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Cauliflower kg Rs85
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Pineapple kg Rs105
Cucumber kg Rs55
Papaya kg Rs75
Banana Doz Rs85
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daily commodities
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Jeera Masino Rice kg Rs70
Indian Basmati Rice kg Rs120
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Chana(Big) kg Rs200
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Silver Rs735
Source: FENEGOSIDA
Int’l market
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Gas Oil Fut (Ice) (Mt) 649.75 0.23
Gasoline Rbob Fut (Gal) 201.42 0.72
Natural Gas Futr (Mmbtu) 2.95 -0.34
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Corn Future (Bu) 382.5 -0.07
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Rough Rice (Cbot) (Cwt) 10.73 -0.14
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Soybean Oil Futr (Lb) 28.95 0.24
Sugar #11 (World) (Lb) 10.65 -1.75
Wheat Future(Cbt) (Bu) 585.75 -0.13
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Copper Future (Lb) 274.8 -0.63
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Gold 100 Oz Futr (T Oz) 1,217.60 -0.19
Silver Future (T Oz) 15.37 -0.60
C M Y K