In Iraq's Fields of Black Gold, Thousands Lose Livelihoods

Local worker Muhammad Subeih Haider, who was laid off amid the spread of the coronavirus disease (COVID-19), by private British security firm operating in West Qurna 1 oilfield, developed by Exxon Mobil, stands as he protests with others in front of the Basra Oil Company in Basra, Iraq, May 20, 2020. Picture taken May 20, 2020. REUTERS/Mohammed Aty
Local worker Muhammad Subeih Haider, who was laid off amid the spread of the coronavirus disease (COVID-19), by private British security firm operating in West Qurna 1 oilfield, developed by Exxon Mobil, stands as he protests with others in front of the Basra Oil Company in Basra, Iraq, May 20, 2020. Picture taken May 20, 2020. REUTERS/Mohammed Aty
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In Iraq's Fields of Black Gold, Thousands Lose Livelihoods

Local worker Muhammad Subeih Haider, who was laid off amid the spread of the coronavirus disease (COVID-19), by private British security firm operating in West Qurna 1 oilfield, developed by Exxon Mobil, stands as he protests with others in front of the Basra Oil Company in Basra, Iraq, May 20, 2020. Picture taken May 20, 2020. REUTERS/Mohammed Aty
Local worker Muhammad Subeih Haider, who was laid off amid the spread of the coronavirus disease (COVID-19), by private British security firm operating in West Qurna 1 oilfield, developed by Exxon Mobil, stands as he protests with others in front of the Basra Oil Company in Basra, Iraq, May 20, 2020. Picture taken May 20, 2020. REUTERS/Mohammed Aty

Mohammed Haider, a security worker in Iraq's southern oilfields, thought he was safe after signing a new one-year contract to guard oil facilities. Three days later, he was out of a job.

"I got laid off. They threw us out on the pavement," the 38-year-old said, speaking as he protested outside the Basra Oil Company headquarters, the national partner for foreign companies.

Haider had been hired to drive vehicles for a British security firm around the giant West Qurna 1 oilfield that produces hundreds of thousands of barrels of crude each day - part of OPEC member Iraq's principal source of wealth.

He now spends his days at home or searching in vain online for jobs that are hard to come by in a crisis-hit economy.

"I can't even fall back on taxi-driving work. The curfew because of coronavirus means I'd get arrested for driving around illegally," he said later at his home.

Haider is one of thousands of workers in Iraq's oil sector who were laid off this year after a fall in oil prices caused by the COVID-19 pandemic, and who struggle to find any other source of income.

Iraq in March asked international oil companies to cut their budgets by 30% because of plummeting oil prices. Energy companies in the south responded by cutting costs.

Subcontractors, including security, construction and transport firms, let thousands of workers go, according to local authorities.

"Of about 80,000 Iraqis working in the oilfields, some 10,000 to 15,000 are now out of work," said Mohammed Ibadi, a local government official in Basra province, where most of the southern fields are located.

Iraqi workers had been forced to take unpaid leave or had been laid off completely, mostly by subcontractors, he said.

'I'D TAKE HALF MY WAGES'

Ibadi's office received dozens of complaints from workers who asked Iraqi authorities to sanction companies that do not comply with contractual termination terms. The local authorities negotiated 50% and 25% salaries for four months for some 2,000 workers who had been laid off, he said.

Khalid Hamza, associate director of the Basra Oil Company, said the government body would not accept the arbitrary termination of local staff.

"We particularly need to protect the jobs of the local population," he said.

Iraq has pledged to cut nearly a million barrels of oil production per day (bpd) in line with OPEC cuts. Its exports stood at 3.2 million bpd in May. The cuts have slashed state revenue, of which it makes up more than 90%.

The government faces making cuts to public sector pay - a move that would further anger impatient Iraqis who staged protests last year against alleged government corruption and lack of jobs.

Ibadi fears the economic and social crisis will worsen as the COVID-19 pandemic hits Iraq harder.

With most jobs in Basra linked to the energy industry, it is near impossible for workers like Haider to find an alternative source of income.

The father of three, who worked for five years as a driver for the British company, subcontracted by an American oil corporation, is ready to take on any job to provide for his family.

Haider fears he might no longer be able to cover school or medical costs.

"I wish the company would take me back, even for half my wages," He said.



China’s October New Lending Tumbles More than Expected despite Policy Support

 A masked woman walks at a fashion boutique displaying posters to promote Singles' Day discounts at a shopping mall in Beijing, Monday, Nov. 11, 2024. (AP)
A masked woman walks at a fashion boutique displaying posters to promote Singles' Day discounts at a shopping mall in Beijing, Monday, Nov. 11, 2024. (AP)
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China’s October New Lending Tumbles More than Expected despite Policy Support

 A masked woman walks at a fashion boutique displaying posters to promote Singles' Day discounts at a shopping mall in Beijing, Monday, Nov. 11, 2024. (AP)
A masked woman walks at a fashion boutique displaying posters to promote Singles' Day discounts at a shopping mall in Beijing, Monday, Nov. 11, 2024. (AP)

New bank lending in China tumbled more than expected to a three-month low in October, as a ramp-up of policy stimulus to buttress a wavering economy failed to boost credit demand.

Chinese banks extended 500 billion yuan ($69.51 billion) in new yuan loans in October, down sharply from September and falling short of analysts' expectations, according to data released by the People's Bank of China (PBOC).

Economists polled by Reuters had predicted a fall in new yuan loans to 700 billion yuan last month from 1.59 trillion yuan the previous month and against 738.4 billion yuan a year earlier.

"Corporate financing demand remains weak due to poor profitability," said Luo Yunfeng, an economist at Huaxin Securities. "Credit demand may not pick up soon despite recent central bank policy measures."

The PBOC does not provide monthly breakdowns but Reuters calculated the October figures based on the bank's Jan-October data released on Monday, compared with the Jan-September figure.

The PBOC said new yuan loans totaled 16.52 trillion yuan for the first ten months of the year.

Household loans, including mortgages, dropped to 160 billion yuan in October from 500 billion yuan in September, while corporate loans dipped to 130 billion yuan from 1.49 trillion yuan, according to Reuters calculations based on central bank data.

Chinese policymakers have been working to arrest further weakness in an economy stuttering in recent months from a prolonged property market downturn and swelling local government debt.

Among their goals is to tackle the side-effects from a mountain of debt left from previous stimulus dating back to the 2008-2009 global financial crisis.

China's central bank governor Pan Gongsheng said China will step up counter-cyclical adjustment and affirm a supportive monetary policy stance, a central bank statement showed on Monday, citing a report Pan delivered to the top legislative body last week.

In late September, the central bank unveiled an aggressive stimulus package including rate cuts, and Chinese leaders pledged "necessary fiscal spending" to bring the economy back on track to meet a growth target of about 5%.

MORE STEPS ON THE CARDS

China unveiled a 10 trillion yuan debt package on Friday to ease local government financing strains and stabilize flagging economic growth, as it faces fresh pressure from the re-election of Donald Trump as US president.

New measures planned will include sovereign bonds issuance to replenish the coffers of big state banks, and policies to support purchase of idle land and unsold flats from developers, Finance Minister Lan Foan said.

Analysts at OCBC Bank expect the central bank to deliver another cut in banks' reserve requirement ratio in November or December to support the planned bond issuance.

China watchers are skeptical the steps will produce a near-term boost in economic activity as most of the fresh funds will be used to reduce local government debt, but China's central bank said it will continue supportive monetary policy to create a favorable monetary and financial environment for economic growth.

The PBOC also said it will study and revise money supply statistics to better reflect the real situation of the country's money supply.

Trump's election win could also prompt a stronger fiscal package in expectations of more economic headwinds for China. Trump threatened tariffs in excess of 60% on US imports of Chinese goods, rattling China's industrial complex.

Broad M2 money supply grew 7.5% from a year earlier, central bank data showed, above analysts' forecast of 6.9% in the Reuters poll. M2 grew 6.8% in September from a year ago.

Outstanding yuan loans grew 8.0% in October from a year earlier. Analysts had expected 8.1% growth, the same pace as in September.

The outstanding total social financing (TSF), a broad measure of credit and liquidity in the economy, slowed to a record low of 7.8% in October, from 8.0% in September. Acceleration in government bond issuance could help boost growth in TSF.

TSF includes off-balance sheet forms of financing that exist outside the conventional bank lending system, such as initial public offerings, loans from trust companies, and bond sales.

In October, TSF fell to 1.4 trillion yuan from 3.76 trillion yuan in September. Analysts polled by Reuters had expected TSF of 1.55 trillion yuan.