Business

MOSCOW — Like millions of people around the world, Yuri Nekrasov stopped going to the grocery store every day last year when authorities in Moscow enforced a coronavirus lockdown. 

But even after restrictions were lifted, Nekrasov has stuck to his new routine, ordering groceries online from rapid delivery companies that promise everything from milk and eggs to toilet paper in as little as 15 minutes.

"We now only go to a real supermarket once a week or once every two weeks," the 32-year-old finance lawyer told AFP.

Rapid grocery delivery services have recently boomed in Russia, reflecting a global trend that has seen similar businesses winning customers in Europe and the United States.

More than $14 billion has been invested in grocery delivery services worldwide since early 2020 — most of it this year — according to PitchBook, a financial data provider.

Russians have embraced e-commerce later than other countries, but the world of online shopping has recently seen explosive growth.

While many retailers offer online delivery services, companies like Lavka (small shop) run by tech giant Yandex — which Nekrasov's family uses — and Samokat (Scooter) seek to carve out a niche as ultra-fast online convenience stores.

During Russia's strict coronavirus quarantine demand for grocery deliveries spiked, overwhelming some retailers.

Overloaded platforms were unable to service customers and some chains experienced delivery delays of up to several days.

As established market players buckled under the pressure, rapid delivery services boomed, said Maxim Avtukhov, chief financial officer and chief commercial officer at Yandex.Lavka, which was founded in 2019.

"It was a game changer," said Avtukhov. 

"Before the pandemic we were an amusing toy. The pandemic changed everything, especially in the beginning when people were gripped by panic."

The company, which also offers a restaurant food delivery service, relies on an army of bicycle couriers and multiple warehouses known as "dark stores". 

On average it takes two minutes to put together an order, Avtukhov said.

The service, which has a limited assortment of goods and prices generally higher compared to supermarkets, has targeted young, middle-class professionals. 

Mary Levocz, a 34-year-old English teacher in Moscow, said she started using Yandex's 15-minute delivery service in early winter to avoid going out in the cold and lugging around heavy items such as bottled water.

"I use it because it's the most convenient option for ordering very random or small items," Levocz noted.

'Why not New York?' 

In the fourth quarter of 2020, the rapid delivery business brought in more than 4 billion rubles ($52 million), or 18 per cent of Yandex's taxi and food delivery services. 

Lavka operates across several major Russian cities, and this week the company said it was gearing up to launch operations in Paris and London.

"There were lots of orders in winter," Kutman Kanatbek Uulu, a Yandex.Lavka courier, said after delivering two orders to Moscow customers from a nearby windowless warehouse.

"We deliver about 40-50 orders a day," the 18-year-old from Kyrgyzstan said, adding that he can earn around 3,000-5,000 rubles ($39 to $65) a day.

Across the Atlantic, a warehouse of a New York fast delivery start-up in the family-friendly Brooklyn neighbourhood of Park Slope is also a beehive of activity.

A delivery man with a bright blue and white backpack rushes with an order to a customer two streets away, then returns a few minutes later. 

The start-up called Fridge No More was founded by two Russians, Anton Gladkoborodov and Pavel Danilov, in 2020.

"We knew that people in Moscow like it, so why not in New York?" said Danilov, the start-up's 38-year-old co-founder. 

This spring the start-up — whose workers are all staffers — raised more than $15 million and hopes to open dozens of sites in New York over the next 12 months.

Despite an explosion in demand for super-fast deliveries it is still not clear what the industry will look like when the dust settles after the initial surge, said Olivier Salomon, managing director at AlixPartners, a Paris-based consultancy.

"What will take precedence, the speed of delivery or the breadth of the offer? It's hard to do both."

ABIDJAN — The three million African farmers who supply most of the world's cashew nuts aren't cashing in on the booming demand due to a lack of processing facilities, a UN body said on Friday.

World production and trade in raw cashew nuts have more than doubled since 2000 with African producers, led by Ivory Coast, accounting for almost two-thirds of the growth.

But the continent's farmers and exporters get only a fraction of the final retail price, according to a new report by the United Nations Conference on Trade and Development (UNCTAD).

"Countries that grow cashews but don't process them at a significant scale retain only a small share of the value created as the nut travels from the farm to store," said Miho Shirotori, who leads UNCTAD's work on trade negotiations and commercial diplomacy.

"African farmers, exporters and workers are missing out on a wealth of opportunities," she added.

Cashews thrive in the tropical climates of 20 western and eastern African countries, where about 90 per cent of the raw cashew nuts traded in the global market are grown. Behind Ivory Coast the main producers are Tanzania, Nigeria, Benin, Guinea-Bissau, Mozambique and Ghana, according to UNCTAD.

But less than 15 per cent of the continent's cashew nuts are even de-shelled on African soil.

The rest is exported mainly to Asia, where more value is added. India and Vietnam accounted for about 98 per cent of the world's raw cashew imports between 2014 and 2018, according to the report.

More than 60 per cent of the traded kernels are then roasted, salted, packaged and consumed as a snack or an ingredient in other products, in Europe and North America.

While admitting to difficulties in calculating just how much the Africans are losing, the report estimated that by the time cashews are processed in the EU their price is about 8.5 times higher than when they left the farm in Ivory Coast.

"This shows the potential for value creation in African cashew-growing countries, 14 of which are classified as 'least developed'," Shirotori said.

"And value creation can lead to better wages for workers and more money for the local economy."

Between 2000 and 2018, world trade in raw cashew nuts more than doubled to 2.1 billion kilogrammes, according to UNCTAD.

WASHINGTON — New applications for US unemployment benefits fell sharply last week, reaching the lowest level since the Covid-19 pandemic caused mass unemployment, according to government data released on Thursday.

The Labour Department said there were 576,000 new jobless claims filed last week, seasonally adjusted, far fewer than analysts had expected and the fewest since the week ended March 14, 2020 -- just before the coronavirus sparked business disruptions and millions of layoffs.

The total dropped nearly 200,000 from the previous week, which was revised upward, marking the largest weekly decrease since last August.

However, another 131,975 people, not seasonally adjusted, filed applications under a program for freelance workers and others not normally eligible for aid, bringing total new claims to more than 700,000 in the week ended April 10.

That nonetheless is a relatively low number given that initial claims soared into the millions in the early weeks of the pandemic, and Kathleen Bostjancic of Oxford Economics said the data are a positive sign the US economy is rebounding.

"The reopening and rehiring has begun with gusto," she said on Twitter.

This week's positive report nudged the four-week moving average for initial claims down to 683,000.

However, the world's largest economy, which enjoyed record low unemployment before the pandemic, remains short millions of jobs lost when the virus hit. 

As of the week ended March 27, nearly 17 million people were claiming jobless benefits under all government programs, the report said.

And through April 3, the insured unemployment rate indicating people actually receiving regular benefits climbed slightly to 2.7 per cent with more than 3.7 million people receiving benefits.

TOKYO — The Japanese owner of a megaship seized after blocking the Suez Canal has said it is negotiating with Egyptian authorities after they demanded $900 million in compensation for its release.

The 200,000 tonne MV Ever Given got diagonally stuck in the narrow but crucial global trade artery in a sandstorm on March 23, triggering a mammoth six-day-long effort to dislodge it.

Maritime data company Lloyd's List said the blockage by the vessel, longer than four football fields, held up an estimated $9.6 billion-worth of cargo between Asia and Europe each day it was stuck.

Egypt also lost between $12 and $15 million in revenues for each day the waterway was closed, according to the canal authority.

The MV Ever Given was later seized "due to its failure to pay $900 million" compensation, Suez Canal Authority chief Osama Rabie was quoted as saying by the state-run Al Ahram newspaper.

Its fate is "now... in the legal arena", a spokeswoman for the ship's owner Shoei Kisen Kaisha said on Wednesday.

An unnamed spokesperson was also quoted by Japan's Jiji Press agency as saying the firm was "at odds with the canal authority in talks over the appropriate amount [of compensation]" but that discussions were ongoing.

The Japanese-owned, Taiwanese-operated and Panama-flagged ship was moved to unobstructive anchorage in the canal after it was freed on March 29, and tailbacks totalling 420 vessels at the northern and southern entrances to the canal were cleared in early April.

The compensation figure was calculated based on "the losses incurred by the grounded vessel as well as the flotation and maintenance costs" Rabie said, citing a ruling handed down by the Ismailia Economic Court in Egypt.

The grounding of the ship and the intensive salvage efforts are also reported to have resulted in significant damage to the canal. 

The Suez Canal earned Egypt just over $5.7 billion in the 2019/20 fiscal year, according to official figures — little changed from the $5.3 billion earned back in 2014.

SAN FRANCISCO — The US company behind video game sensation Fortnite said on Tuesday that it was valued at $28.7 billion in a round of funding from investors including PlayStation maker Sony.

Epic Games announced that it raised $1 billion, with $200 million of that coming from Sony. The Japan-based video game and consumer electronics giant first invested in Epic last year.

"We are excited to strengthen our collaboration to bring new entertainment experiences to people around the world," Sony Group chief Kenichiro Yoshida said in a release.

Plans for the funding included building social experiences into Epic's popular Fortnite and Rocket League games.

Hit video games such as Fortnite have seen use soar during the pandemic, and their creators see potential to expand beyond play to virtual parties, get-togethers or work-events.

"We are grateful to our new and existing investors who support our vision for Epic and the Metaverse," said Epic founder and chief Tim Sweeney.

The "metaverse", a term coined by sci-fi writer Neal Stephenson, refers to a shared online world in which users can hang out, spend money, consume media and potentially even work jobs.

Epic, which has recruited Brazilian football star Neymar and other celebrities promotion the game, said an estimated 350 million users.

The funding round comes as Epic prepares to face off in court with Apple in an effort to break the iPhone maker's tight grip on the App Store.

In legal filings, Epic has accused Apple of trapping people in its mobile device world and collecting "outsized commission" at the App Store that serves as the only source of digital content.

Apple counters that it has no monopoly when it comes to digital games and that the suit is part of an effort by Epic to portray "Apple as the 'bad guy' so that it can revive flagging interest in Fortnite".

Apple pulled Fortnite from its App Store in August of last year after Epic released an update that dodges revenue sharing with the iPhone maker, and the companies are now locked in a legal battle.

A trial in the case is set to begin May 3 in US federal court near San Francisco.

NEW YORK — Microsoft will acquire artificial intelligence and cloud computing company Nuance for $19.7 billion, bolstering the telemedicine services that became essential during the pandemic, the tech giant announced on Monday.

Nuance's technology is used extensively in medical records and is currently employed in more than three-quarters of US hospitals, Microsoft said in a news release. The transaction is all-cash and the sum includes Nuance's net debt.

Nuance's technology is currently used by more than 55 per cent of physicians and 75 per cent of radiologists in the United States. Microsoft said the deal would double its potential healthcare market to nearly $500 billion.

"AI is technology's most important priority, and healthcare is its most urgent application," Microsoft Chief Executive Satya Nadella said.

"Together, with our partner ecosystem, we will put advanced AI solutions into the hands of professionals everywhere to drive better decision-making and create more meaningful connections, as we accelerate growth of Microsoft Cloud for Healthcare and Nuance."

This acquisition builds on the existing partnership between the two companies, which have been collaborating since 2019 in telemedicine, a sector whose growth has been spurred exponentially by COVID-19 lockdowns around the world.

Last year, the Redmond, Washington-based giant integrated Nuance Communication's Dragon Ambient eXperience program into its Teams communications software, which enables remote transcription of medical conversations.

Nuance CEO Mark Benjamin noted the increasing demand for its products in recent years.

"To seize this opportunity, we need the right platform to bring focus and global scale to our customers and partners to enable more personal, affordable and effective connections to people and care," Benjamin said in the statement. "The path forward is clearly with Microsoft."

'No brainer' 

The deal comes on the heels of Microsoft's 2016 purchase of LinkedIn for $27 billion and represents "the latest step in Microsoft's industry-specific cloud strategy", the company said.

Like other technology heavyweights, Microsoft has been a big beneficiary of the economic dislocations during COVID-19.

The company's earnings jumped by 33 per cent in the latest quarter to $15.5 billion and included a boost from cloud computing and personal computing, including its Xbox video games.

Wedbush analyst Daniel Ives called the Nuance tie-up a "trophy" deal for the company founded by Bill Gates, which is on a "strategic offensive" in search of targets to purchase.

"For Nadella & Co., this is the right acquisition at the right time with Microsoft doubling down on its healthcare initiatives over the coming years," he said in an analysis. "The Nuance deal is a strategic no brainer in our opinion for MSFT and fits like a glove into its healthcare endeavours."

Based in Burlington near Boston, Nuance was founded in 1992 and specialises in conversational artificial intelligence solutions, particularly in the healthcare sector.

Nuance Communications, which employed more than 7,100 people as of September 30, reported sales of $1.48 billion last year.

Benjamin, will remain at the head of the new group, the statement said. He will report to Microsoft's executive vice president of cloud and artificial intelligence, Scott Guthrie.

Ives said Microsoft is on the hunt for more acquisitions and this deal "could be the first step in an increased appetite for deals in 2021 with Discord [video game chat community] another potential trophy for Redmond".

It comes just a few months after the takeover of ZeniMax, the parent company of video game publisher Bethesda Softworks, for $7.5 billion in September.

Media reports cite the potential for other big deals, including crafting platform Pinterest in a possible $51 billion transaction, and the popular Discord discussion platform for about $10 billion.

Shares of Nuance surged 17 per cent to $53.35 in midday trading, while Microsoft edged up 0.3 per cent to $256.68.

SHANGHAI — Chinese regulators hit e-commerce giant Alibaba with a record 18.2 billion yuan ($2.78 billion) fine on Saturday over practices deemed to be an abuse of the company's dominant market position.

Alibaba, the Jack Ma-founded Chinese e-commerce leader and one of the world's most valuable companies, said it accepted the penalty and pledged to outline plans on Monday for bringing its operations in compliance.

The fine appeared to cap a government crackdown on major Chinese tech platforms, and Alibaba in particular, over allegations of anti-competitive behaviour and misuse of consumer data.

The State Administration for Market Regulation said it assessed the fine after concluding an investigation into Alibaba that began in December.

The probe centred on Alibaba's practice of forbidding merchants who wish to sell their wares on its popular online marketplaces from simultaneously offering them on rival e-commerce sites.

"Since 2015, Alibaba Group has abused its dominant position in the market" with the exclusivity requirement, the regulator said. 

The requirement harmed competition, innovation, and the interests of merchants and consumers, it added.

The fine was a record and nearly three times the almost $1 billion levied against Qualcomm in 2015, Bloomberg said.

The size of the penalty was determined after the market watchdog decided to fine Alibaba four per cent of its 2019 sales of 455.7 billion yuan.

Shortly after the decision was announced Alibaba issued a contrite statement that used many of the government's recent talking points on the issue, pledging to make changes to safeguard fair competition.

"We accept the penalty with sincerity and will ensure our compliance with determination," it said.

The company added that it would hold a conference call with investors on Monday to share its "thoughts and plans for the long-term healthy development of our business in the future".

"We are committed to ensuring an operating environment for our merchants and partners that is more open, more equitable, more efficient and more inclusive in sharing the fruits of growth," it said.

AMMAN — The Housing Bank approved the distribution of cash dividends at a rate of 12 per cent of the share nominal value for the year 2020, according to a bank statement.

During a virtual general assembly meeting on Thursday, its general assembly also approved the board of directors report, the financial statements for the year 2020 and the bank’s business plan for 2021.

Deloitte was elected as an external auditor to audit the company’s accounts for 2021.

Housing Bank Chairman of the Board of Directors Abdel Elah Al-Khatib presided over the meeting, which was attended by shareholders holding 94.739 per cent shares of the bank’s capital. 

The meeting was also attended by the general comptroller of companies, representatives of the Central Bank of Jordan and the representative of the bank’s auditing firm Deloitte.

According to Al Khatib, 2020 was a year replete with exceptional challenges and circumstances at the economic, health and social levels as a result of the coronavirus pandemic. Nevertheless, the bank continued its effective and pivotal role in the community, providing JD3.1 million of financial assistance to health, educational and social institutions, as well as more than JD500,000 donated by Housing Bank employees in support of the Ministry of Health’s efforts to curb the effects of the pandemic. 

Al Khatib said that despite the difficulties, the Housing Bank achieved strong operational results and recorded sustainable growth in its operational profits and total income, which confirms the bank's ability to adapt and confront challenges with exceptional effectiveness and agility due to the diversity of its sources of income, its operational efficiency, as well as effective cost control procedures. All these factors led to the achievement of JD203.5 million in operational profits, an increase of 8.6 per cent compared to 2019, while the Group’s net profit after provisions and taxes amounted to JD42.5 million compared toJD83.7 million during 2019. This decrease in net profit was a result of booking additional loan loss provisions for the loan portfolio, reached to more than double of the amount booked in the previous year, in order to protect the bank and strengthen its financial position in light of the negative economic conditions resulting from the coronavirus pandemic, according to the bank statement.

WASHINGTON — Warning that the recovery from the pandemic crisis is not yet over, the International Monetary Fund (IMF) on Thursday called on policymakers to continue to spend money to shore up the global economy and ensure no one is left behind.

Without that aid, and additional financing from both the fund and the World Bank, developing countries and the poor in many countries could struggle to rebound from the downturn caused by COVID-19, the IMF said at the conclusion of its spring meeting.

Continued support is needed to “mitigate and heal economic scars,” IMF Managing Director Kristalina Georgieva told reporters.

“We want to make sure everybody has a fair shot to a better life.”

That means accelerating access to vaccines and taking advantage of the opportunity presented by the crisis to invest in green technology, which can create good paying jobs and address climate change.

US Treasury Secretary Janet Yellen joined the call, urging “significant” new spending to ensure a solid rebound from the damage inflicted by the COVID-19 pandemic.

While the economic outlook has “improved significantly”, especially due to substantial government support, “the job is not yet done, given high uncertainty and the risk of permanent scarring”, Yellen said.

“I urge major economies to not just avoid removing support too early, but to strive to provide significant amounts of new fiscal support to secure a robust recovery,” she said.

The IMF now projects global growth of 6 per cent this year after the 3.3 per cent contraction last year and credited the $16 trillion in global public spending during the pandemic with keeping the worst peacetime recession in a century from being three times as severe.

Yellen highlighted the $1.9 trillion US aid package President Joe Biden signed last month, as well as his proposal announced last week to spend $2 trillion on infrastructure and jobs.

Boosting resources 

Yellen said that with stimulus already boosting the recovery from the pandemic shutdowns, the US economy “could reach full employment as soon as next year”, but many developing countries do not have similar resources to support their economies.

Georgieva warned about a “dangerous divergence” in low-income countries’ prospects compared to rich nations, which could worsen if advanced economies like the United States raise interest rates sooner than expected.

She also praised the IMF members who agreed to allow the fund to issue $650 billion in new Special Drawing Rights, an additional pool of IMF currency that will add to nations’ reserves and boost their ability to access financing.

The IMF is expected to present a proposal to its board in June, and Georgieva said the fund is working with rich nations to shift some of their share of those reserves to help aid developing nations, which “face a crucial policy transition from crisis to recovery”.

Vaccines as economic policy 

The officials again stressed that ending the health crisis remains central to the economic recovery, and the closing statement from the IMFC, the fund’s steering committee, lamented the “uneven access to vaccines”.

The committee emphasised “the need for strong international cooperation to accelerate vaccine production and support affordable and equitable distribution to all”.

Yellen pledged US support for vaccine rollouts, including efforts to “make sure financing does not become an obstacle for global vaccination... and to work toward ensuring robust, equitable, and transparent vaccination deployment”.

Shift to green 

The crisis offers policymakers a vehicle to capitalise on the need for investments to accelerate green projects that can provide good-paying jobs.

“Government efforts to support the recovery need to take advantage of the opportunity to accelerate the transition towards a low-carbon economy and limit the long-term threat from climate change,” said Angel Gurria, head of the Organisation for Economic Cooperation and Development.

Georgieva said those investments could create jobs in growing industries to replace those lost in sectors that are shrinking.

“Climate risks are growing, and they are substantial for macroeconomic and financial stability, climate action can generate green growth and green jobs,” she said.

The IMF and World Bank have also announced plans to intensify the focus on green investment and climate-friendly aspects of their lending programmes.