WSJ : Weak Demand Dents China’s Exports

Weak Demand Dents China’s Exports

Exports declined 1.8% year-over-year in April in dollar terms, reversing an increase of 11.5% the previous month

BEIJING—China’s exports unexpectedly fell in April as weak demand continued to weigh on the world’s second-largest economy, though the results were an improvement over the first quarter.

Exports declined 1.8% year-over-year in April in dollar terms, reversing an increase of 11.5% the previous month, the General Administration of Customs said Sunday. This undershot a median forecast for exports to remain constant by 15 economists polled by The Wall Street Journal. Economists attributed the March surge to a favorable comparison with year-earlier figures and seasonal distortions after the Lunar New Year holiday.

Imports in April fell by a sharper-than-expected 10.9% from a year earlier, compared with a 7.6% drop in March. China’s trade surplus widened more than expected last month to $45.56 billion from $29.86 billion in March.

While Sunday’s results were weaker than expected, exports and imports improved over the first quarter, when exports fell by around 9% and imports by 13% on average. A series of leading indicators released by the customs agency Sunday also signaled a modest improvement in confidence and new orders.

“Global demand hasn’t seen any big improvement,” said Standard Chartered economist Ding Shuang. “Relatively speaking, things are better. There’s a gradual improvement on the external side.”

Chinese exporters continue to battle weak demand. Exports to the U.S. fell 9.3% year-over-year last month, increased 6.4% to Southeast Asia and rose 3.2% to the European Union, the customs agency reported Sunday. In April, the International Monetary Fund lowered its 2016 global growth forecast to 3.2% from 3.4%, its second reduction this year.

“There is little hope of a recovery in external demand,” said Commerzbank AG economist Zhou Hao. “China is on its own.”

Dalian Kelier Glassware Co., an exporter of candle sticks and ashtrays based in the northeastern city of Dalian, said its sales are down to all markets especially the U.S. “Like most Chinese export companies, we’re not doing very well,” said Shi Yujin, the company’s general manager. “We’re struggling with the same things as most Chinese companies, including soft demand, high labor cost and cheap competitors in foreign countries like Malaysia and Vietnam.”

Since late last year, the official value of China’s monthly imports from Hong Kong often has significantly exceeded the value of Hong Kong’s official exports to China -- the two should be roughly equal—suggesting that people have inflated or overinvoiced legitimate trade deals to hide capital flight, economists said. Last month, China’s imports from Hong Kong were up 203.5%. Hong Kong hasn’t reported its April exports to China yet, but in March they fell 11%.

Economists said overinvoicing pressure should start to ease in coming months given less volatile yuan trading recently, however, assuming the U.S. doesn’t raise interest rates, economists said.

“The expectation of more stability in the renminbi suggests the trend toward capital outflow is easing a bit,” said Tom Rafferty, economist with the Economist Intelligence Unit, using a different name for the yuan.

On Saturday, China’s central bank reported that foreign-exchange reserves rose by $7.09 billion last month to $3.22 trillion, although economists attributed some of this to currency gains from a weaker dollar.

Given China’s large April trade surplus, the latest of several, trade issues with China are likely to remain a political issue in the U.S. presidential race, economists said. Last week, the Treasury Department placed five countries including China on a new monitoring list designed to pressure these countries to address large trade imbalances with the U.S.

The report stopped short of naming China a currency manipulator, which would subject it to economic sanctions, although the Treasury Department said it would employ new tools to monitor countries with large trade surpluses.

Imports of iron ore, copper and crude oil picked up in April, boosted by more infrastructure spending and a pickup in the housing market, economists said, even as China continues to battle trade tensions over allegations of selling steel abroad at less than the cost of production.

“The depreciation of the yuan, which will make input costs cheaper, suggests that overcapacity in China’s commodities producing sector will persist, resulting in the dumping of exports on international markets,” said BMI Research in a report.

Reuters - Glencore in talks to sell further 9.9 pct stake in agriculture unit -


Glencore in talks to sell further 9.9 pct stake in agriculture unit - sources

* Bidders include Canada pension fund, SALIC and Qatar

* Voting rights key negotiation point

* CPPIB, 9.9 pct stake deals targeted to close by year-end

By Clara Denina and Sarah McFarlane

LONDON, May 6 (Reuters) - Commodity trader and miner Glencore is in talks to sell a further 9.9 percent stake in its agricultural unit, negotiating with bidders that missed out on the 40 percent sold to Canada Pension Plan Investment Board (CPPIB), two sources with knowledge of the matter said.

Glencore declined to comment.

Bidders include a different Canadian pension fund, state-backed Saudi Agricultural and Livestock Investment Co (SALIC) and Qatar's sovereign wealth fund, the sources said.

SALIC and Qatar's sovereign wealth fund were not immediately available to comment.

Last month, CPPIB agreed to buy a 40 percent stake in the unit for $2.5 billion, placing the equity value of the business at $6.25 billion. Including inventories and debt, the unit is valued at closer to $10 billion.

The 9.9 percent stake is valued at around $625 million.

Glencore had been aiming to close the deals at the same time in the second half of 2016, the sources said.

"Negotiations are ongoing ... people who lost out are still trying to get on board, but Glencore will struggle to get more money for it," one said.

The London-listed company announced its intention to sell a minority stake in its agricultural unit in September, after shareholder pressure to see it cut debt prompted a slew of measures including asset sales, reducing capital expenditure, suspending dividend payments and raising $2.5 billion of new equity capital.

The group said it aimed to cut net debt to between $17 billion and $18 billion by the end of 2016, down from a peak of $30 billion last year.

One sticking point to the deal is whether the smaller stake holder will have voting rights, as CPPIB does, the sources said.

The agriculture business allows Glencore to trade grains, oilseeds, rice, sugar and cotton.

It generated core earnings of $524 million in 2015 and had gross assets of more than $10 billion.

>>> LSE and Deutsche Boerse executives unlikely to be questioned by UK MPs about

LSE and Deutsche Boerse executives unlikely to be questioned by UK MPs about merger

The London Stock Exchange Group’s [LON:] proposed merger with German counterpart Deutsche Boerse is likely to proceed without executives from either company’s management being questioned about the deal by UK members of parliament (MPs), The Daily Mail reported. The newspaper said the Treasury Select Committee is believed to have abandoned plans to ask senior management at the two exchange operators to answer questions about the deal in parliament, but did not cite a source for the information.

The report added the chairman of the select committee, Andrew Tyrie, could yet write to regulators and to both stock exchange operators. However, the bosses are now unlikely to face questions in parliament, according to the report.

The proposed merger has faced criticism in some quarters as abandoning the UK’s national interest, the item noted.

Although the merger has been billed as a deal among equals, Deutsche Boerse shareholders will own 54.4% of the enlarged group, with the German exchange operator’s CEO Carsten Kengeter holding the top job, the report added.

The government could use rarely-exercised authority to block mergers or acquisitions deemed to be contrary to the interests of the public, the item said.

Conservative MP Bill Cash has previously urged Business Secretary Sajid Javid to act with regards to the LSE/Deutsche Boerse tie-up, the report added. Cash has argued that Deutsche Boerse was looking to undermine London’s financial services sector, according to the newspaper.

The article went on to quote sources close to Javid, who said the minister would probably decide on any course of action after regulators have made their thoughts known.

London Stock Exchange Group’s market capitalisation stood at GBP 9.04bn (EUR 11.43bn) at the close of trading in London on Friday, 6 May.

Daily Mail

FT : Activists say Russian telecoms group hacked Telegram accounts

Activists say Russian telecoms group hacked Telegram accounts

A group of Russian activists plans to sue telecoms group MTS over claims the company helped hack into their accounts on messaging app Telegram.
Opposition leader Alexei Navalny’s Anti-Corruption Foundation is exploring a US class-action lawsuit against the New York-listed Russian operator, after activists Oleg Kozlovsky and Georgy Alburov received warnings that their accounts on the app had been accessed from other devices last month.

The hack has raised concerns over the vulnerability of Telegram, which has gained popularity among the millennial generation, political activists and terrorist groups because of the privacy it offers.
Governments around the world are increasingly seeking ways to access data that has been encrypted by services such as these. Earlier this year, the FBI and Apple were engaged in a stand-off over a request to access data on the iPhone of one of the attackers in the San Bernardino shootings.
The activists published documents on Wednesday that they say show MTS colluded with the unknown intruders without following the legal procedures required for the FSB, the KGB’s successor agency, to gain access.
Mr Kozlovsky and Mr Alburov’s phone records show that MTS turned off their text messaging services at about 2:25am on April 29. Shortly afterwards, someone using Tor, an anonymous web browser, requested access to their Telegram accounts through a confirmation code.
Mr Kozlovsky and Mr Alburov were both asleep and could not receive the codes, which were sent to an unknown number and used to download their message history. Only after the hack was over were their text functions restored later that morning.
Though the activists admit they left themselves exposed by not using two-factor authentication or Telegram’s secret chat function, they blame MTS for actively assisting the intruder. “You can’t blame someone for having their car stolen if they leave it outside rather than in a garage,” Mr Kozlovsky said. “Some guy from the organs just called up and said, ‘Do this and that’.”
MTS, Russia’s largest mobile provider with over 70m subscribers, denies the charges. The company said it was conducting a detailed technical audit to see if the incident was the result of a virus attack.
Pavel Durov, the founder and chief executive of Telegram, said he suspects Russia’s secret services were behind the hacks. Though Russian law grants them the right to access any and all user data, it also requires the approval of a judge. That formality was not followed in this case.
“This is technically possible everywhere, but democratic countries typically try to avoid intercepting SMS without a court order, because such measures are highly visible and can lead to public uproar,” he said.
Frederic Jacobs, a former developer at rival messaging app Signal, said the activists would still have been vulnerable without end-to-end encryption, which means messages cannot be read from any device other than the sender’s. “If there are encrypted messages I cannot send messages to the recipient without showing that I am someone else,” he said.
Mr Durov founded Vkontakte, Russia’s biggest social network, but left Russia in 2013 saying that the Kremlin had forced him out of the company.
The FSB did not respond to requests for comment.

FT : Fund houses plan to pay for research themselves

A quarter of asset managers will stop charging clients for the research they use to make investment decisions and will cover the costs themselves, according to a poll of 100 asset managers by EY, the consultancy.
Twenty-six per cent of fund managers said they would follow the lead of Neil Woodford, the celebrated UK fund manager, by paying for the research they use themselves rather than passing the cost on to investors. Mr Woodford’s fund house, Woodford Investment Management, last month said it would stop charging clients for research, arguing that those costs are “a function of our role” and should not be borne by investors.

The move by Mr Woodford came just weeks before Brussels put forward proposals that will require asset managers to either pay for research themselves or face burdensome rules on how research costs are passed on to clients.
Only a fifth of asset managers said they would continue to pass on the cost of research to investors, while 8 per cent said they would charge some clients, according to the EY poll.
Under the EU proposals, the decades-long practice of lumping together the fees asset managers pay investment banks and brokers for both research and trading will come to an end.
Instead, for the first time, asset managers in Europe will have to budget for the cost of research in advance and make it clear to investors what they are being charged for.
Almost half of asset managers polled by EY were still undecided on how they would respond to the new rules, which form part of Europe’s Mifid II regulation that is expected to come into force in 2018.
Uner Nabi, executive director at EY, said even if asset managers do not initially stop charging clients for research, they are likely to face calls to do so in future.
Asset managers that pass the cost on to investors will find it “difficult to justify” if their rivals are paying for the research out of their own pockets but performing as strongly, he added.
“A year or two down the line, when there are asset managers out there that are not charging clients, there will be peer pressure [on other asset managers] to not charge clients,” he said.
Consumer champions have long said asset managers should not be passing on the cost of research to investors, arguing that this should come out of the management fee investors pay already.
Craig Newman, chief executive at Woodford Investment Management, told FTfm last month: “Research costs are a function of our role and we believe it is only right that Woodford Investment Management, not our investors, pays for it.”

FT : New rules have created a research headache for fund managers

New rules have created a research headache for fund managers

Who should pay for the research fund managers use when making investment decisions? This is the question being asked on the back of new EU proposals that have created a conundrum for asset managers.
Under draft rules published by the commission, the EU’s executive arm, last month, the fund industry’s decades-long practice of lumping together the fees they pay investment banks and brokers for research and trading will come to an end.

Instead, for the first time, asset managers in Europe will have to make it clear to investors exactly what they are paying for.
“It is a big deal for asset managers,” says Uner Nabi, an executive director at EY, the consultancy.
The rules form part of the forthcoming Mifid II regulation. They are widely expected to shine a light on the value of research, which typically includes written reports from bank analysts and getting access to meetings with the management team of public companies.
All the asset managers contacted for this piece, including BNP Paribas Investment Partners, the French fund house, Allianz Global Investors, the fund arm of the German insurer, and Union Investment, the €252bn asset manager, say they are still deciding how they will react to the proposed changes.
They are not alone. Sean Tuffy, head of regulatory intelligence at Brown Brothers Harriman, the financial services company, says: “Managers are still trying to get to grips with what the new world will look like.”
As well as affecting asset managers, the proposals are likely to have a big impact on investment banks, brokers and research companies. Some banks, including Japan’s Nomura, have already begun scaling back their research arms, as the business of providing research becomes less profitable.
But the rules should be good news for investors, who will have greater insight into traditionally hidden fees and charges.
The new transparency will force fund companies to pay more attention to the cost and value of research, which is likely to push prices down over time and eventually lower the charges that are passed on to investors.

The proposals are also expected to prompt some fund houses to stop charging investors for research.
“[The draft rules] have put a spotlight on what exactly people are paying for,” says Adam Toms, chief executive of Instinet Europe, a broker. “That transparency may well lead to further pressure for managers to pay for research themselves.”
According to an EY poll of around 100 asset managers, a quarter of fund houses will stop charging clients for research on the back of the proposals, taking on the costs themselves.
Some asset managers, anticipating an overhaul of the research market, have already done this, including Neil Woodford, the UK’s best-known fund manager, and Baillie Gifford, the Scottish asset manager.
“We are acutely aware that it is investors’ money, not ours, we are investing,” Craig Newman, chief executive at Woodford Investment Management, told FTfm last month.
“Research costs are a function of our role and we believe it is only right that Woodford Investment Management, not our investors, pays for it.”
A rise in the number of asset managers paying for research themselves has been welcomed by consumer champions, who have long argued that fund companies should not be passing the cost of research on to investors.
“Fund managers should be required to bear all the [research and trading] costs involved in fund management,” says Mick McAteer, co-founder of The Financial Inclusion Centre, a think-tank, and a former board member of the UK financial regulator.
The new rules do not require this. But they do require asset managers to end the practice of “bundling”, whereby investment banks and brokers offer asset managers research for “free” in exchange for carrying out trades.

More recently, some asset managers have moved towards commission-sharing agreements, where they pay a broker to execute their trades and ask that broker to allocate a portion of that payment to a research provider.
Under the new proposals, asset managers will have to set up a separate research payment account that is funded in advance and not linked to the volume of trades that are executed. Commission-sharing agreements will subsequently “lose their commercial attractiveness”, says EY’s Mr Nabi.
These changes are pushing some asset managers to consider paying for research themselves, although research experts point out that commission-sharing agreements are likely to remain the norm for many global asset managers.
This is because the practice of sharing commission, in various forms, is common in many countries, including the US.
Elizabeth Corley, vice-chairman of AllianzGI, is among those asset managers who believes it will be difficult to follow Mr Woodford’s lead and stop charging clients for research, as her company is more international.
She says: “[Mr Woodford] has a single fund, focused on the UK, where he has extraordinary access to companies. You have to question whether he really needs any research. He doesn’t have to worry about the US or Japan or Asia or Europe.
“With that single-fund focus and single-jurisdiction focus, you have more ability [to stop charging for research]. We would hesitate to make [a similar] decision because we are a global company.”
She adds that a lack of transparency from big investment banks around the true cost of research and trading is another factor holding large fund companies back from paying for research themselves.
Her concern is that banks might raise the cost of executing trades to make up for a drop in demand for their research reports once the true value of those reports is made clear.
“We are very keen to see an unbundling of the cost [of research and trading] from investment banks. We have been talking about and asking for that for some time.
“If we [got that] unbundling from the investment banks, that would be a huge step forward,” she says.
“What we would not want [is to begin paying for research ourselves], and then find that our trading costs across the market have inflated by a magical factor. We would be very upset about that.”
Other asset managers appear unsure about the best approach to paying for research. Only 15 per cent of managers polled by EY said they would continue to use these commission-sharing agreements based on the rules as they stand. More than three-quarters were undecided about their next steps.
But Nick Thomas, a director at Baillie Gifford, which stopped paying for research earlier this year, says more asset managers will opt to pay for research themselves.
“We have had a few questions from other asset managers, [who] asked to talk about how we did this. I suspect we will see [asset management companies paying for research] gain traction,” he says.
Mr Thomas is also unconvinced that it is more difficult for a global asset manager to pay for research itself than for a small fund house that focuses on one market. He points out that Baillie Gifford runs £123bn of assets across global equity, fixed income and multi-asset funds for an international client base.
He says: “Paying for research internally is much simpler. You need a much more detailed mechanism of proving the value of what you are paying for [if you charge clients for research]. Rather than building a big infrastructure to do that, we took [payments for research] in-house.
“There was no huge cost [to Baillie Gifford]. We had no difficulties in removing that cost from clients’ bills. This means the operational costs [charged to clients] are lower.”
All change in the EU: Traditional commission-sharing model ditched
A commission-sharing agreement allows an asset manager to make one payment to a broker or investment bank to cover both trading and research costs.
Under the current system, a fund manager will pay a broker a percentage of the value of a trade being executed. For example, a fund manager might pay 15 basis points to sell 1,000 shares of company X.
Of this 15bp, 5bp might be used to cover the costs of trading, while the broker might allocate the remaining 10bp to pay for research, often from external research providers.
The percentage of execution fees used to pay for research is set out in the commission-sharing agreement.
Jeremy Davies, co-founder of RSRCHXchange, the research company, says that under proposed EU rules, asset managers will no longer be able to use the traditional commission-sharing model.
Instead, the amount a fund manager pays for research cannot be linked to trading volumes. But a modified commission-sharing agreement, where the fund manager still makes just one payment, can still be used.
Under this model, the fund manager would continue to pay 15bp, for example, when executing a trade. Five basis points would be used to cover the trading costs. The remaining 10bp would then be moved into the new research payment account.
However, the cost of research has to be budgeted in advance under the proposals.
This means that once the fund manager has reached the limit they have set for research costs, the fund manager and broker would have to move to an execution-only rate.

>>> Fersa attracts final offers from Springwater, Audax and Oaktree; low bids ma

Fersa attracts final offers from Springwater, Audax and Oaktree; low bids may trigger hostile move 

Fersa, the listed Spanish renewable-energy company, has attracted final offers from the fund Springwater, the Spanish electricity trader Audax and the PE firm Oaktree, according to a report in Expansion that did not cite any sources.

Swiss-based Springwater is bidding in alliance with Texas Pacific Group (TPG), the Spanish-language business paper said. Fersa has also attracted the interest of the funds Abac, Cerberus and First Reserve, according to the report.

The offers tabled for Fersa are at EUR 0.45 per share, which would value 100% of the company at EUR 63m, Expansion went on to say. The price per share offer is 6% below the listed Spanish renewable-energy company’s stock value at closing of Friday 6 May, the paper noted. Fersa's management board considers such offers insufficient and values the company at EUR 0.8 per share or EUR 110m in total, a difference of opinion that could trigger a hostile takeover bid, according to the report.

In 2015, Fersa reported an EBITDA of EUR 17.72m, up 17% compared to a year earlier, over sales of EUR 28.82m, up 10.4%, Expansion noted. The company posted losses of EUR 53.45m.

Fersa’s capital is very fragmented: the Spanish holding Enhol is its main shareholder with a 22% stake and all other shareholders own stakes below 10%, the report said. Among the minority shareholders is the Spanish construction group Comsa, which holds 7.5%, Expansion said.

Expansion

FT : Tokyo traders brace for stormy week of earnings

Tokyo traders brace for stormy week of earnings

Traders in Tokyo are predicting the most volatile return from “Golden Week” national holidays since Shinzo Abe became prime minister, as corporate earnings and a rising yen present “Abenomics” with one of its sternest tests to date.
As well as a slew of major earnings reports from the nation’s largest automakers Toyota and Nissan and from trading houses such as Mitsubishi Corp and Mitsui & Co hit by slumping oil and commodity prices, economic data are expected to expose the fragility of sentiment toward Japan after a massive sell-off by foreign investors.

Particular attention, say analysts, will fall on the Economy Watchers Survey, due out May 12 — the first conducted since a series of earthquakes hit the southern city of Kumamoto in April and disrupted the supply chains of Sony and other leading Japanese electronics and auto-parts makers.
As volumes ramp back up following nearly 10 days of closed or thinly traded markets, dealers predict that Japanese and overseas investors alike will be taking a critical look at how the first three months of negative interest rates — introduced on February 16 — have dragged on the financial sector and the economy. Results from Mizuho Financial Group, Sumitomo Mitsui Financial Group and, the most negatively affected by the policy, Japan Post Bank, could well confirm fears.
The vulnerability to currency fluctuations will also be in sharp focus, say traders. Monday begins the first full week of trading since the Bank of Japan’s unexpected decision on April 28 to forego further monetary easing — a move that caused the yen to surge into the Y106 zone against the US dollar and revived speculation that the Japanese authorities may be tempted to intervene.
Currency analysts are expecting post-Golden Week markets to repeatedly test the Y105/$ level — the exchange rate that an increasing number of Japanese corporates are now building into their profit assumptions for the current financial year. An increasing number of forex analysts, however, anticipate a test of the Y100/$ level in coming weeks as Japan prepares to host the G7 leaders summit at the end of May.

The currency’s approach towards Y100/$ would see an effective reversal of the yen weakness that has driven Japan’s long bull market since Mr Abe came to power in 2012.
“Abenomics stands at a critical crossroads,” said Goldman Sachs economist Naohiko Baba, commenting on forex markets ahead of the post-Golden Week trading resumption.
Nomura’s Japan equity strategist, Hisao Matsuura, expects an intensified rush by analysts this week to revise forecasts across the board as the market absorbs what is expected to be a severe impact of recent currency moves on earnings momentum.
Although earnings are in a downward phase, he wrote in a note to investors, the early stages of the full-year results season has seen the number of companies where results were either higher or lower than Nomura’s forecasts being roughly equal.
But Mr Matsuura added that Nomura had slashed its forecasts for recurring profits at large-cap Japanese companies: where previously the brokerage had forecast a 6.6 per cent year on year decline in recurring profits in the first half of the 2016 financial year, Nomura now expects an 11.1 per cent contraction.

FT : Greek parliament begins debate on austerity measures amid wave of strikes

Greek parliament begins debate on austerity measures amid wave of strikes

The Greek parliament has opened a two-day debate on tough new pension and tax measures demanded by bailout creditors amid a wave of unannounced strikes that shut down local media outlets, public transport and ferries to the Aegean islands.
A vote is due on Sunday night in the 300-member house, where the leftwing Syriza party of Alexis Tsipras, the prime minister, and his coalition partner, Independent Greeks, together control a fragile two-seat majority.

The premier unexpectedly brought forward the vote hoping to convince eurozone finance ministers meeting on Monday that Greece is now committed to completing a first review of its €86bn bailout after six months of foot-dragging over details of the reforms.
Greek officials were upbeat on Saturday about a call by Christine Lagarde, the International Monetary Fund chief, for negotiations to begin immediately on granting debt relief for Greece. At the same time, the Fund backtracked on earlier demands for another €3bn in “contingency” budget cuts, saying they were “fruitless”.
“It’s a positive development for Greece after weeks of fighting hard against the contingency measures,” said a senior Greek official. “Debt relief is expected to be part of the discussion on Monday.”
Sunday’s parliamentary vote refers to €3.6bn of spending cuts and income tax increases, together amounting to two-thirds of a €5.4bn fiscal package agreed with the EU and IMF.
The Syriza-led government will face another test when it presents further legislation on the remaining €1.8bn, to be covered through increases in indirect taxation. Measures under discussion include a one percentage point hike in valued-added tax to 24 per cent and higher fuel taxes.
With public sector unions stepping up strikes and a street campaign against the latest reforms, Mr Tsipras’s move for an early vote was also aimed at preempting possible defections by far-left lawmakers, a Syriza official said. This weekend’s walkouts shut down bus and metro services in Athens, while ferry strikes left thousands of tourists stranded on islands without airports.
The same official said the party was not anticipating defections by its lawmakers after the Group of 53, the main internal party opposition, made clear it would support the measures.
Rallying Syriza lawmakers ahead of the debate, Mr Tsipras claimed that after four months of often contentious negotiations with the EU and IMF the government had “brought off reforms that combine viability with social justice.”
The pensions bill, which aims to rescue the pay-as-you go state system from looming collapse, leaves current pensions in the state system untouched. It also introduces a new across-the-board “national pension” of €384 a month after 20 years of work. Both measures are in line with Syriza’s election promises to voters.
But supplementary benefits for current pensioners will be cut along with main pensions for new retirees. Social security contributions are set to rise sharply, with self-employed professionals such as lawyers and doctors facing the highest increases.
On income tax, the new legislation will streamline tax brackets, reducing the tax-free allowance and imposing a bigger burden on middle- and high-income taxpayers.

FT : 13 Iranians killed in battle for strategic town south of Aleppo

13 Iranians killed in battle for strategic town south of Aleppo

Thirteen Iranian soldiers have been killed near Aleppo in what appears to be the heaviest loss of Iranian life in Syria since it deployed its forces to support Syrian President Bashar al-Assad five years ago.
The elite Revolutionary Guards said 13 Iranian military advisors had been killed and 21 wounded when Islamist insurgents attacked the strategic town of Khan Touman, some 15km southwest of Aleppo.

“The violation of ceasefire by takfiri groups (radical Sunni extremists) in the vicinity of Aleppo and savage attacks by them…led to martyrdom of some of our [Iranian] advisory forces,” the guards said in the statement released on Saturday.
Iran’s state television said the rebels dispatched a force of at least 3,000, backed by tens of tanks to attack Syrian government forces and their allies stationed in Khan Touman.
The Islamist forces, led by the al Qaeda branch, Jabhat al-Nusra, captured the town on Friday. If they can hold it, this will be a major boost to opposition forces in other parts of northern Syria, opening up key supply routes. It will also push back the Assad regime’s line of defence in Aleppo’s surrounding countryside which, like the city, is split between opposition and government forces. Mr Assad has said he is determined to win back all of Aleppo.
The province is supposed to be part of a truce deal brokered by Russia and the US, extended for a further 72 hours on Saturday. But so far, the ceasefire is only holding in Aleppo city itself. Fierce fighting is still raging in nearby villages and regime air and artillery strikes are hitting towns like Khan Touman.
On Friday, Jabhat al-Nusra released photographs that appear to show wallets filled with Iranian money and identification cards taken from the corpses of fighters. Other pictures show what appears to be a pile of dead bodies in camouflage uniforms.
A video released by other opposition groups shows a man in Khan Touman picking his way through corpses on an empty street. The man says they are the bodies of Iranians and Afghans. Tehran has been sending not only members of Iranian forces, it is also accused of sending Afghan refugees to join Shia militias that have been bolstering Mr Assad’s forces.
The guards statement urged people not to be affected by the Islamist rebels’ “psychological war on the social media”.
In addition to Iranian experts and military commanders which are believed to help direct operations, Shia militias from Iraq and Lebanon have become a major component of the regime’s fighting forces in the battle for Aleppo. The Damascus government has been struggling with a manpower shortage, and many analysts say this has made Mr Assad critically dependent on militias and support from Iran.
A top advisor to Iran’s Supreme Leader on Saturday reiterated Tehran’s continued support of Syria’s president in a meeting with Bashar al-Assad in Damascus.
“Iran will use all its means to fight against terrorists who are committing crimes in the region,” Ali Akbar Velayati, Ayatollah Khamenei’s top adviser on international affairs, was quoted as saying by the Fars news agency.