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Careem suspends its decade-old Pakistan services
Careem, Uber’s ride-hailing division in the Middle East will suspend its Pakistani service on 18 July, citing economic issues, increasing competition, and capital restrictions. This marks an end to its core business, which was pioneered in Pakistan nearly a decade earlier. This move highlights the strains on Pakistan's digital industry as tech firms cut back due to high inflation, weak demand from consumers, and tighter capital flows. Careem's nearly 10-year run is over. The app was launched in 2015, and quickly became the dominant player in mobile apps. In a LinkedIn posting on Wednesday, Mudassir Shaikha, Careem's co-founder, CEO, and founder, Mudassir Sheikha said, "This was a very difficult decision." The challenging macroeconomic realities, increasing competition and global capital allocation, made it difficult to justify the levels of investment required to deliver a reliable and safe service in the country. Careem has helped to normalize digital payment, app-based bookings and female ridership. In recent years, newer players such as the Latin American inDrive and Russia's Yango have entered major cities with low-cost models. Uber will leave Pakistan in 2022. Since 2022, Pakistan's startup eco-system has been under pressure as venture capital funding has dried up, the inflation rate soared to 38%, before dropping to 3.5% and consumption has weakened. Airlift, Swvl VavaCars, and Truck?It?In are among the startups that have closed or reduced their operations. Uber, Lyft, and Grab, among others, have diversified their services to include payment and delivery. In emerging markets, rising costs, regulations, and thin margins have increased the pressure. Uber is still operating in some parts of the Middle East, North Africa and Europe but has pulled out where profits are not possible. (Reporting and editing by Toby Chopra in Islamabad, Ariba Sharif in Islamabad)
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Former Iranian Minister calls for Iranian control of Strait of Hormuz
Ehsan Khandouzi, the former Iranian Economy Minister, has stated that LNG and tankers should only be allowed to transit the Strait of Hormuz if they have Iranian permission. This policy should begin "tomorrow and continue for 100 days." Khandouzi's comments were not immediately clear. Was he expressing a plan that was being considered by the Iranian establishment or was he voicing his own opinion? Tehran has used the threat to block the narrow waterway for years as a way to deter Western pressure without actually acting on it. Israel's air attack on Iran last weekend, after concluding that Iran was close to developing a nuke weapon, has raised the stakes. Iran insists that its nuclear program is solely for civilian purposes. This policy [of controlling the maritime transit in Strait]is crucial if it is implemented on time. Khandouzi wrote on X Tuesday that any delay in implementing it would prolong the war within the country. The Iranian Oil Ministry and Foreign Ministry have not responded to requests for comments immediately. Khandouzi, who served as the economy minister in the cabinet of the late President Ebrahim Raisi until the summer last year, remains close to hardliners within the Iranian establishment. The Strait of Hormuz is located between Oman, Iran, and Iraq and is the main export route for Gulf producers like Saudi Arabia, United Arab Emirates and Kuwait. The Strait of Hormuz is just 33 km wide, but it contains around 18 million barrels of oil per day.
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JD.com, a Chinese online retailer, is looking to the international market as a growth opportunity
JD Logistics launched JoyExpress on Wednesday in Saudi Arabia. This is the first time that the logistics arm for Chinese ecommerce giant JD.com has operated its own consumer-focused delivery service overseas. JD Logistics is known for its own-built warehouse and delivery network. It operates more than 3,600 warehouses within its country. JD Logistics says that JoyExpress will extend this self-operated business model to other countries, including Saudi Arabia. Delivery services can be as quick as same-day. Richard Liu, the founder and chairman of JD.com, believes that the expansion could be the first step towards the company's new international growth push. Consumer confidence has been hit by China's prolonged property crisis, and concerns about wage growth have added to the deflationary pressures. Liu gave a presentation in Beijing on February 2 in which he stressed the importance of global markets for JD.com’s future growth, and the likely acceleration in pace of JD.com’s overseas forays. "We've been working in Europe now for three years and the infrastructure is basically there." According to local media, he added that it was still not enough. Liu called the last five years "lost" and said that JD.com must compete in new areas with Chinese food giant Meituan, from travel booking to food delivery. JD launched JD Takeaway earlier this year, which is a direct rival to Meituan. Meituan also expanded into Saudi Arabia over the past few years. It's regrettable that JD.com didn't introduce anything new in the last five years. He said that the past five years have been a time of decline. Liu revealed JD.com’s plans to seek stablecoin licensing in the major currencies countries around the world. The goal is for global companies to be able to exchange foreign currency more easily. This will reduce the cost of international payments by 90%, and increase efficiency to 10 seconds. The Hong Kong Monetary Authority announced last year that JINGDONG Coinlink Technology Hong Kong (a JD Technology subsidiary) had joined the stablecoin issuer sandbox. This is a framework created by the HKMA in order to communicate regulatory expectations to institutions interested in releasing stablecoins. (Reporting and editing by Christian Schmollinger, Kim Coghill, and Sophie Yu)
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AirAsia CEO: Aircraft are needed for growth, but the first priority is restructuring.
Tony Fernandes - CEO of Capital A Group, said that AirAsia's owner is in discussions to purchase 50 to 70 Airbus A321XLR aircraft in the coming months. However, the priority for the group is to complete its restructuring. In an interview, he said that the Asian low-cost airline is still in negotiations to purchase 100 regional aircraft from Airbus A220 and Embraer E2. However, there will be no announcements on orders made at this week's Paris Airshow. "I don’t think an order will be placed at this airshow." We are still working with Airbus, and other manufacturers ).... Fernandes stated that they would like to see something done in the near future, within the next 1 to 3 months. We want to ensure that we are done with our restructuring. We're now back at the growth phase. Airbus is Airbus' largest customer and operates a fleet of all Airbus aircraft in Malaysia. Sources in the industry said AirAsia had advanced discussions with Airbus to place at least 100 regional jets A220 at the Paris Airshow. Rival Embraer was also competing for the chance to enter the Airbus-only carrier. Fernandes confirmed that AirAsia had also received an offer from China’s COMAC. AirAsia previously stated that it is looking to add smaller aircraft for regional routes. AirAsia, one of Airbus’ biggest customers, has over 350 planes ordered. It did not place an order before the pandemic but it ended a delivery gap by taking four Airbus aircraft last August. This was a milestone in its growth, which AirAsia described. As a result of financial problems, it has been restructuring its order books. Malaysia's stock market classified the company as financial distressed in 2022, after it was severely affected by travel restrictions due to pandemics. The company says it hopes it will be able to leave this so-called PN17 (pandemic travel restrictions) status by mid-year as it works towards a recovery. Capital A intends to sell AirAsia's aviation business to AirAsia X, a long-haul division. This will consolidate both long-haul and short-haul flights under a single AirAsia name. The group needs to raise capital and also obtain consent letters from its creditors. It has "virtually" all of these. "I hope we can finish this process by the end July." Fernandes stated that we are getting closer. Fernandes claimed that new investors were "locked in," though he declined to give specifics ahead of any official announcement. Reporting by Tim Hepher. (Editing by Joe Brock, Mark Potter and Mark Potter).
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WSJ reports that the Boeing 787 emergency power system was likely activated before the Air India crash.
The Wall Street Journal, citing sources familiar with the investigation, reported Wednesday that investigators believe Air India Boeing Dreamliner's emergency power generator was operating at the time of the crash last week in India Ahmedabad. Boeing has said that it will refer any comments to the Aircraft Accident Investigation Bureau of India. Engine manufacturer GE Aerospace has not responded to a comment request. The Indian Ministry of Civil Aviation did not respond immediately to an email seeking comment. Couldn't verify immediately the WSJ article. The Ram Air Turbine system (RAT) generates both electricity and hydraulic pressure, allowing pilots to control the aircraft even if one or both engines fail. The report stated that preliminary findings raise questions regarding whether the engines of the plane functioned correctly during takeoff. The Dreamliner is equipped with GE Aerospace GEnx engine. After takeoff, the Boeing 787-8 Dreamliner with 242 passengers bound for Britain’s Gatwick Airport started losing altitude. The worst aviation accident in the last decade saw all but one passenger die, along with 30 fatalities on the ground. India's aviation safety regulator said Tuesday that Air India's Boeing fleet was not subject to any major safety concerns. (Reporting and editing by Christian Schmollinger; Kanjyik ghosh)
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UAE claims navigational error led to oil tanker collision in Strait of Hormuz
According to the UAE's Energy Ministry, a collision between oil tankers near Strait of Hormuz may have been caused by an error in navigation by one of those vessels. In a Wednesday statement, the ministry cited preliminary data and denied any connection with an increase in electronic interference during conflict between Iran and Israel. Two oil tankers, Front Eagle and Adalynn, collided on Tuesday and caught fire 24 nautical miles from the coast of UAE in the Sea of Oman. There were no injuries reported to the crew, and there was no spillage. Interference has caused navigation systems to be disrupted near the Strait of Hormuz. This waterway, which connects Iran and Oman, is responsible for about a fifth of all oil transported by sea. Tehran has not yet commented on the collision that occurred Tuesday or the reports of interference. Reporting by Ahmed Elimam, Maha El Dahan and Barbara Lewis. Editing by Tomasz and Barbara Lewis.
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Samsung Heavy cancels $3.54 billion in icebreaker orders with Zvezda, a Russian company
Samsung Heavy Industries, a South Korean shipbuilder, said that on Wednesday two orders for icebreakers worth 4.85 trillion won (US$3.54 billion) from Russia's Zvezda were cancelled because the "illegal termination of the shipowner". Samsung Heavy stated in its regulatory filings that Zvezda Shipyard unilaterally terminated the contract with the South Korean firm in June 2024 and demanded the return of any advance payments. Samsung, in July, filed an arbitration request at the Singapore Arbitration Court to confirm the illegality the termination while engaging in negotiation with Zvezda. Samsung Heavy said that as the conflict between Russia and Ukraine continued, the uncertainty over the execution of contracts and the business increased. It decided to cancel the contract and seek damages in order to protect its rights. The order was to supply parts and blocks for 10 icebreaker LNG carriers and 7 shuttle tankers.
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BBC reports that the UK has delayed opening of the HS2 rail line.
BBC reported Wednesday that the opening date of Britain's new high-speed railway line, HS2, will be delayed. It was originally scheduled to open in 2033. The project has suffered from cost overruns for years. The previous government had to cancel the northern part of the project, between Birmingham and Manchester, two years ago due to its ballooning budget. HS2 costed 33 billion pounds (44 billion dollars) and was scheduled to be completed by 2026. The cost of HS2 has risen to more than 100 billion pounds. The BBC reported that Heidi Alexander, Minister of Transport, is expected to inform Parliament on Wednesday, that the route's opening will be delayed beyond the already delayed plan for 2033, but will not give any new information on the exact date. The Department of Transport did not respond immediately to a comment request. HS2, which was proposed in 2010, is designed to increase capacity and catch up Britain's infrastructure with other European countries that have extensive high-speed tracks. BBC reported that Alexander will release two reports on the issues surrounding HS2, in an effort to reset the way Britain builds infrastructure. The Labour government, which will be elected in 2024 has placed accelerating the planning process for new energy and transportation projects at the core of its growth agenda. It has supported expansion at London’s Heathrow Airport and Gatwick Airport. Reporting by Sarah Young, editing by James Davey.
Israelis in Cyprus can now fly home
Airport sources and flight tracking websites showed that flights left for Israel from Cyprus on Wednesday, ferrying Israelis home who were stranded overseas during the conflict with Iran.
Israel's airspace is closed after the two countries started trading attacks on Friday. Tens of thousands were stranded when their flights to Tel Aviv cancelled.
Israel announced Tuesday special flights to repatriate its citizens.
Arkia operated a flight from Cyprus's Larnaca Airport at 7:25 am (0425 GMT). The flight was bound for Tel Aviv. Sources at airport operator Hermes confirmed that nine more flights were scheduled to leave Wednesday, with about 1,000 passengers, for Haifa and four others for Tel Aviv.
Israel's Transportation Ministry said that up to 150,000 Israelis were abroad. About a third of them are trying to return home.
Cyprus is the closest EU member to Israel. On Wednesday morning, 1,500 Jewish heritage participants who left Israel on Tuesday boarded a cruise ship that arrived in Cyprus. (Reporting and editing by Clarence Fernandez; Michele Kambas)
(source: Reuters)