December 11, 2018

St. Petersburg ranks as world’s best cultural destination … for 3rd year in a row!

Saint Petersburg, that once again justified its rank as the Russian cultural capital, triumphed over Beijing, London, New York City, Paris, the Ecuadorian capital of Quito, Rio de Janeiro, Rome, Sydney, and Venice.

The red carpet ceremony was held in the Portuguese capital of Lisbon. WTA annually awards leaders in tourism, airlines, and hotel and hospitality sectors. Ranked as the travel industry’s most prestigious awards programme, WTA was founded in 1993 and includes an international jury of hospitality experts and peers, mainly from the World Travel and Tourism Council.

Saint Petersburg became the world’s leading cultural city destination in both 2016 and 2017. In 2015, the WTA jury awarded the northern city the title of Europe’s leading destination. Earlier this year, the city won the title of Europe’s best cruise destination.

St. Petersburg, which is home to the Hermitage Museum and the Mariinsky Ballet, has been in focus of the prestigious award for its exceptionally rich history, centuries-old traditions, and bright future.

The cultural capital of Russia is stunningly attractive for travelers. The city is one of the most visited by both domestic and international tourists. In 2017, Saint Petersburg was visited by 7.2 million people compared to 6.9 million tourists in the previous year, according to the latest data by the city’s tourism committee.

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Russia ready to switch off Visa & Mastercard ahead of tougher US sanctions

The regulator has recommended that Russian financial institutions take the necessary preventive steps in case their partner-banks are forced to stop providing connection to services by the world’s two most used payment systems – Visa and Mastercard, reports Russian business daily Vedomosti.

The list of Russia’s banking majors that are currently working as an intermediary include Credit Union “Payment Center,” one of Russia’s largest private lenders Uralsib, Rosbank that operates as a Russian subsidiary of the international financial group Societe Generale, Russia’s second biggest bank VTB and privately owned Promsvyazbank.

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VTB and Promsvyazbank have already been included in the Countering America’s Adversaries Through Sanctions Act (CAATSA), approved by US Congress last summer. The legislation allows Washington to introduce penalties against enterprises and individuals that are seen as hostile towards the US or loyal to regimes that are hostile to the US.

The Central Bank of Russia advises that Russian banks should look for an alternative sponsor that will be able substitute a current provider of Visa and MasterCard services, seal a maintenance service contract and test an opportunity of integrating.

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In response to sanctions Russia has developed its own national payment system. The Mir payment system was introduced in 2015 after clients of several Russian banks were temporarily unable to use Visa and Mastercard due to US sanctions. Customers found bank issued credit cards linked to Visa and Mastercard systems no longer worked. The country issued 37 million Mir cards as of June 2018.

Earlier this month, Sberbank CEO German Gref said one or two of the Russian lenders are vulnerable to potential US sanctions. However, Gref stressed that none of the banking majors would be sanctioned.

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Oil prices jump over 4% as OPEC reaches production cut deal

OPEC members and major oil producing countries led by Russia have agreed to cut crude output by 1.2 million barrels per day (bpd), a spokesman said as quoted by Bloomberg. 

The long-anticipated deal was reached as OPEC and major global producers met in Vienna. The key purpose of the meeting was to negotiate production cuts in order to boost global crude prices that have seen a dramatic drop of nearly 30 percent over recent months.

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Major crude benchmarks saw a 4 percent jump in prices after the deal was reached. Brent crude jumped to $63.04 per barrel at 14:08 GMT on Friday, while US crude benchmark West Texas Intermediate (WTI) surged to $53.85 a barrel.

Earlier, Reuters reports emerged stating Russia was planning to agree to cut 200,000 bpd (barrels per day), if the 15-member organization offers the curbs of more than one billion bpd.

There were also earlier reports that the OPEC negotiations had stalled due to some members refusing to cut production.

Iran reportedly demanded exemption from the cuts amid Saudi-backed US sanctions, but Saudi Arabia was refusing to agree to the exemption. Iran, OPEC’s third-largest producer, has considerably reduced its oil exports so far.

The agreement on production cap was reportedly reached by the cartel and its partners at the beginning of December. However, discussion of individual quotas has reportedly stalled.

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Bloomberg may sell Bloomberg if he runs for president

Bloomberg revealed the possible future of the company, which he founded in 1981, in an interview with Radio Iowa as he came to the state touting a film about climate change which he financed. The richest billionaire in the media business, and 10th richest person in the world, said he would either sell the company or put it in a blind trust.

However, the 76-year-old noted that selling would be a better option at his age. The financial and media empire that bears his name now generates over $9 billion in annual revenue, according to Forbes data.

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“But I think at my age, if selling it is possible, I would do that,” Bloomberg told the radio. “At some point, you’re going to die anyway, so you want to do it before then.”

While Bloomberg eyes the possible presidential run as a Democrat, having financially supported the party during the 2018 midterms and whose values he says he shared all his life, he ran for mayor as a Republican in 2001. He was in the party for around 6 years, before becoming an independent in 2007.

It is not the first time the billionaire has flirted with a presidential bid. In 2018, the tycoon re-registered as a Democrat, in what was seen as a possible step toward running for president in 2020.

The 2020 election will not be the first race for the White House Bloomberg seeks to enter. In 2016, he considered running as an independent, with then-candidate Donald Trump welcoming Bloomberg’s bid, saying he would “love” to compete with him. However, Bloomberg, who has been sharply critical of Trump, pulled out of the race and instead announced his support for Hillary Clinton.

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India to switch from dollar to rupee to pay for Iranian oil

India’s state-owned UCO Bank is expected to announce the new payment mechanism in the next 10 days, the source said.

“An agreement had been signed by the Indian and Iranian governments on November 2, 2018, for oil payment in rupees and 50 percent of those funds had been earmarked for exports,” said an Indian government document viewed by the media.

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Russian and Chinese shipping companies were pitching to facilitate India-Iran trade, the source said.

After US President Donald Trump withdrew from the 2015 nuclear accord with Iran in May and re-imposed economic sanctions, he warned that any countries or companies that conduct transactions with Tehran could face secondary sanctions.

READ MORE: India’s purchases of sanctioned Iranian crude to eclipse last year’s level

India, which is the second biggest buyer of Iranian oil, won an exemption from Washington’s sanctions as it has agreed to cut imports and escrow payments. Under the 180-day exemption, Indian companies are allowed to import a maximum of 300,000 barrels a day of crude oil.

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The country has reduced its monthly purchases to 1.25 million tons. It has imported 22.6 million tons of crude oil from Iran in 2017-2018.

Under US sanctions, India can export farm commodities, food, medicines, and medical devices to Iran but is forbidden from selling petroleum petrochemical products, automobiles, steel, precious metals and graphite.

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George Soros fined over naked short selling by Hong Kong

Regular shorting is a market position motivated by the belief that a security’s price will decline, enabling it to be bought back at a lower price to make a profit. Naked shorting is an illegal practice of short trading that refers to selling shares that have not been affirmatively determined to exist. Naked shorting takes place when investors sell shorts associated with shares that they do not possess and have not confirmed their ability to possess.

SFM HK Management, which is run by the Hungarian investor’s $25 billion family office – the New York-based Soros Fund Management, was fined HK$1.5 million (nearly $200,000) over the so-called naked shorting of a locally listed firm.

The latest Soros-related case dated back to 2015. Back then, the shorting target was Chinese automaker Great Wall Motors Company, according to Hong Kong’s Securities and Futures Commission (SFC).

“The SFC considers that SFM not only failed to act with due skill, care and diligence in dealing in the bonus shares, but also failed to diligently supervise its staff members and implement adequate and effective systems and controls to ensure compliance with the short selling requirements,” the office said in a statement on Thursday.

In August 2015, the Chinese car manufacturer announced the bonus share issue. The local unit of the Soros-owned fund voiced plans to sell Great Wall Motors’ shares. Before the announcement about additional issue of shares by the automaker, Soros’ fund had already owned 808 thousand Great Wall Motors shares.

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SFM HK Management was notified by its custodian that it was entitled to 1.6 million bonus shares as a result of already owning a stake. The subsidiary booked those shares to be allotted into its trading system without separating them into a restricted account, as required by internal policy.

As a result of the illegal manipulation, portfolio managers of the Soros’ company placed an order to sell 2.4 million Great Wall Motors shares, making it 1.6 million shares short.

George Soros earned millions of dollars during the Asian financial crisis that hit the region twenty years ago. His trading activities in Thailand, Malaysia and Hong Kong were even blamed for causing a currency crisis.

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Bitcoin crashes to new 2018 low as crypto market continues nosedive


Bitcoin traded at around $3,389 as of 9:30am GMT on Friday, falling around 12.2 percent in one day, according to the CoinMarketCap website. The digital currency’s market capitalization has dropped by around $4.8 billion over a 24-hour period and is down more than $14 billion in a week. It comes less than a year after Bitcoin was trading at just under $20,000 with more than 330 billion market cap.

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Other popular cryptocurrencies were not immune from the crypto market selloff, with XRP and Ethereum suffering more than 10 and 15 percent losses respectively.

The latest plunge comes less than a week after Bitcoin hit another low in more than a year, trading near $3,900 last Wednesday, shedding thousands of virtual coins since then.

The crypto market is suffering “general negative sentiment,” according to Zennon Kapron, director at financial technology consultancy Kapronasia, as cited by CNBC. The analyst warned that the downward trend may continue next year. Other gruesome predictions say that the driving force of the crypto market may crash to around $1,500, Bloomberg reported citing its analyst Mike McGlone.

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Dow plunges 700 points after Huawei exec’s arrest, fears grow over US-China trade relations

Meng was arrested in Vancouver, Canada, on Sunday, and now faces extradition to the United States. The charges against Meng – the daughter of the telecoms company’s founder – remain unknown, but could relate to a possible violation of sanctions against Iran.

The Huawei executive’s arrest comes at a critical time for US-China relations. Both countries have been locked into a trade war for much of the year, and only agreed last weekend to restart discussions. President Trump has agreed to postpone planned tariff hikes on Chinese goods, while China has pledged to purchase a “very substantial” amount of American produce and curb the export of deadly opioid Fentanyl to the US in exchange.

Representatives from both countries now have just short of 90 days to negotiate, unless the timeframe is extended or a deal reached beforehand.

While stocks rallied on Monday, lingering uncertainty surrounding the precise details of the trade war truce have seen the Dow slump since.

Meng’s arrest could have a significant effect on markets and on US-China relations.

Huawei is one of the world’s largest telecoms companies, and is the world’s second-largest smartphone manufacturer behind Samsung. The company has been accused of using its devices to pass on information to the Chinese government, prompting the US Department of Defense to ban their sale on military bases.

Earlier this year, six top US intelligence chiefs voiced their concerns about Huawei phones to the Senate Intelligence Committee, with FBI Director Christopher Wray saying he was “deeply concerned about the risks of allowing any company or entity that is beholden to foreign governments that don’t share our values to gain positions of power inside our telecommunications networks.”

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Top British and New Zealand telecom providers have banned Huawei from their 5G networks, as did the Australian government. All cited national security concerns in barring the Chinese firm from their next-generation networks.

Huawei, for its part, has consistently denied accusations of spying, and responded to the arrest of Meng by saying it complies with “all applicable laws and regulations” where it operates.

Beijing has called for Meng’s release, and the Chinese embassy in Canada said that her arrest “seriously harmed the human rights of the victim.” Meng, it said, was “not violating any American or Canadian law.”

Thursday’s stock drop also comes as fears of a global economic slowdown circulate. DoubleLine Capital CEO Jeffrey Gundlach told Reuters on Tuesday that the US economy is “poised to weaken.” Signals from the markets include the yield on three-year treasury bonds surpassing those on five-year bonds on Monday. This sign is usually interpreted by traders as an indicator of coming recession.

In Europe, Bloomberg reported Thursday that the European Central Bank is set to lower GDP forecasts, in light of arguments between Italy and Brussels and a slump in oil prices.

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Putin calls for common dollar-less payment system as key for economic sovereignty

“We suggest that the issue of creating common payment infrastructure using up-to-date financial technologies in EEU should be developed,” he said.

“That would enhance sustainability of national payment systems of the EEU countries by making them less dependent on the dollar and other foreign currencies,” the Russian president explained.

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This means “boosting economic sovereignty,”  Putin added.

He also suggested creating common energy markets within the EEU which would increase the union’s GDP to $9 billion, noting that trade turnover within the bloc rose by 12 percent in the first half of 2018.

READ MORE: Russia’s alternative to SWIFT payment system poised to eclipse the original – MP

On Tuesday, the President of Kyrgyzstan Sooronbay Jeenbekov also said that the members of the EEU could abandon border procedures and adopt a common currency in the future similar to the European Union.

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The EEU, which is based on the Customs Union of Russia, Kazakhstan, and Belarus, was established in 2015. It was later joined by Armenia and Kyrgyzstan. In 2016, Vietnam officially became the first non-regional country to join the bloc. The union is designed to ensure the free movement of goods, services, capital and workers between member countries.

More than 40 countries and international organizations, including China, Indonesia, and Israel, as well as some South American countries, have expressed interest in a free-trade deal with the EEU. The trade bloc is also holding negotiations with South Korea, Egypt, and India.

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Saudi Arabia doesn’t need US permission to cut oil output – energy minister

“I don’t need approval from any foreign state when it comes to the issue of energy production,” the top official said as quoted by RIA Novosti.

Members of the Organization of the Petroleum Exporting Countries (OPEC), as well as the cartel’s allies, are meeting at OPEC’s headquarters in Vienna on Thursday. The 15-member organization and non-OPEC partners, including Russia, will reportedly negotiate steep output reductions which could start in January.

The measure is aimed at controlling global oil prices that have seen a dramatic crash of more than 30 percent over the last two months, placing the budgets of oil-exporting nations under considerable pressure.

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The Saudi energy minister stressed that he doesn’t support any exemptions from further slashing of oil output. However, he noted that all the participants will be listened to in order to arrive at a consensus on the issue.

Earlier, Saudi Arabia urged OPEC and its allies to curb output by at least 1.3 million barrels per day, or 1.3 percent of global production. The participants had reportedly discussed the idea of reducing output next year by reverting to production quotas agreed in 2016.

US President Donald Trump has repeatedly pushed Saudi Arabia and OPEC to boost oil production in order to drive down crude prices.

Major news media outlets have even claimed Trump tricked Saudi Arabia into increasing output which led to the current oil price plunge. He reportedly convinced the kingdom to raise output by promising to impose sanctions targeting Iranian oil exports. But later Trump allowed a number of countries to continue to buy Iranian crude, causing an overabundance of crude on the global market leading to lower prices.

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