In its latest report on the Jordanian economy, the World Bank stated that unemployment rates among young people in the kingdom (15-29 years) reached an unprecedented level of 50%. 

The coronavirus pandemic contributed to the problem last year, but the opening of the market to foreign workers even before the beginning of the pandemic exacerbated unemployment figures among Jordanians.

The number of foreign workers in Jordan is estimated at 1 million, of whom about 350,000 are registered with the Ministry of Labor while over 600,000 others are unregistered and work informally.

Most of the foreign workers are Egyptians and Syrians. On the other hand, some blame the "pampered" young Jordanians who are not interested in engaging in jobs in which foreigners are dominant, such as construction and agriculture.

Finance Ministers from the Group of Seven (G7) rich nations reached a landmark accord on Saturday backing the creation of a global minimum corporate tax rate of at least 15%, an agreement that could then form the basis of a worldwide deal. 

Such a deal aims to end what U.S. Treasury Secretary Janet Yellen has called a "30-year race to the bottom on corporate tax rates" as countries compete to lure multinationals.

WHY A GLOBAL MINIMUM TAX?

Major economies are aiming to discourage multinationals from shifting profits - and tax revenues - to low-tax countries regardless of where their sales are made.

Increasingly, income from intangible sources such as drug patents, software and royalties on intellectual property has migrated to these jurisdictions, allowing companies to avoid paying higher taxes in their traditional home countries.

WHERE ARE THE TALKS AT?

The G7 accord feeds into a much broader, existing effort. The Organization for Economic Cooperation and Development has been coordinating tax negotiations among 140 countries for years on rules for taxing cross-border digital services and curbing tax base erosion, including a global corporate minimum tax.

The OECD and G20 countries aim to reach consensus on both by mid-year, but the talks on a global corporate minimum are technically simpler and less contentious. If a broad consensus is reached, it will be extremely hard for any low-tax country to try and block an agreement.

The minimum is expected to make up the bulk of the $50 billion-$80 billion in extra tax that the OECD estimates firms will end up paying globally under deals on both fronts.

HOW WOULD A GLOBAL MINIMUM WORK?

The global minimum tax rate would apply to overseas profits.

Governments could still set whatever local corporate tax rate they want, but if companies pay lower rates in a particular country, their home governments could "top-up" their taxes to the minimum rate, eliminating the advantage of shifting profits.

The OECD said last month that governments broadly agreed on the basic design of the minimum tax but not the rate. Tax experts say that is the thorniest issue, although the G7 accord creates strong momentum around the 15%-plus level.

Other items still to be negotiated include whether investment funds and real estate investment trusts should be covered, when to apply the new rate and ensuring it is compatible with U.S. tax reforms aimed at deterring erosion.

WHAT NEXT

A G20 meeting scheduled for Venice next month will see whether the G7 accord gets broad support from the world's biggest developing and developing countries.

Much still needs to be ironed out - including the metrics that will determine how and to which multinational companies the tax will be applied.

The G7 communique left open what will happen in the meantime to digital services taxes on big technology companies in various jurisdictions, which the United States wanted to be scrapped as soon as a deal was in place.

It said only that there should be "appropriate coordination between the application of the new international tax rules and the removal of all Digital Services Taxes".

Any final agreement could have major repercussions for low-tax countries and tax havens.

The Irish economy has boomed with the influx of billions of dollars in investment from multinationals. Dublin, which has resisted European Union attempts to harmonize its tax rules, is unlikely to accept a higher minimum rate without a fight.

However, the battle for low-tax countries is less likely to be about scuppering the overall talks and more about building support for a minimum rate as close as possible to its 12.5% or seeking certain exemptions.

The United States, Britain and other leading nations reached a landmark deal on Saturday to pursue higher global taxation on multinational businesses such as Google, Apple and Amazon.

In a move that could raise hundreds of billions of dollars to help them cope with the aftermath of COVID-19, the Group of Seven large advanced economies agreed to back a minimum global corporate rate of at least 15% and for companies to pay more tax in the markets where they sell goods and services.

"G7 finance ministers have reached a historic agreement to reform the global tax system to make it fit for the global digital age," British finance minister Rishi Sunak said after chairing a two-day meeting in London.

U.S. Treasury Secretary Janet Yellen said the "significant, unprecedented commitment" would end what she called a race to the bottom on global taxation.

The deal, which was years in the making, also promises to end national digital services taxes levied by Britain and other European countries which the United States said unfairly targeted U.S. technology giants.

However, the measures will first need to find broader agreement at a meeting of the G20 - which includes a number of emerging economies - due to take place next month in Venice.

"It's complicated and this is a first step," Sunak said.

The ministers also agreed to move towards making companies declare their environmental impact in a more standard way so investors can decided more easily whether to fund them, a key goal for Britain.

Rich nations have struggled for years to agree a way to raise more revenue from large multinationals such as Google, Amazon and Facebook, which often book profits in jurisdictions where they pay little or no tax.

U.S. President Joe Biden's administration gave the stalled talks fresh impetus by proposing a minimum global corporation tax rate of 15%, above the level in countries such as Ireland but below the lowest level in the G7.

Germany and France also welcomed the agreement, although French Finance Minister Bruno Le Maire said he would fight for a higher global minimum corporate tax rate than 15%, which he described as a "starting point".

German finance minister Olaf Scholz said the deal was "bad news for tax havens around the world".

"Companies will no longer be in a position to dodge their tax obligations by booking their profits in the lowest-tax countries," he added.

Irish finance minister Paschal Donohoe, whose country is potentially a big loser with its 12.5% tax rate, said any global deal also needed to take account of smaller nations.

Sunak said the deal was a "huge prize" for taxpayers, but it was too soon to know how much money it would raise for Britain.

The agreement does not make clear exactly which businesses will be covered by the rules, referring only to "the largest and most profitable multinational enterprises".

European countries have feared that a business such as Amazon could slip through the net as it reports lower profit margins than most other well-known technology companies.

Protesters in Beirut and other cities in Lebanon took to the streets yesterday, blocking main roads, amid a decision not to allow them to withdraw cash from their dollar accounts at a rate of 3,900 Liras to $ 1. Following the demonstrations, the central bank sought to reconsider its decision.

As has been known for over a year, the banks have not allowed Lebanese to access their dollar accounts and only allow the withdrawal of Lebanese Liras at only a third of the rate of that on the black market (over 10,000 liras per dollar). 

The Lebanese are also angry about blocking access to their money but have somehow come to terms with the low rate offered to them. It is now unclear what they intend to do in Lebanon, and whether the Lebanese's access to their accounts will be permanently stopped. If that happens then there is no doubt that the chaos in the streets will increase.

In the internal arena, the Palestinian Authority is being attacked for what is described as "neglecting" Jerusalem. 

These attacks have come amid the events in recent weeks in Jerusalem and are part of the ongoing struggle between the PA and Hamas. 

It is alleged that the PA that it is allocating only 1% of the total annual budget to Jerusalem, between NIS 50 million and NIS 70 million managed by the Palestinian Authority's Ministry of Jerusalem Affairs. According to the Palestinian Authority, there are about 4,000 merchants and 9,000 businesses in East Jerusalem, 4,000 shops and points of sale in the markets. 

East Jerusalem's contribution to the Palestinian economy is estimated at 7% of its GDP.

Source: Nziv

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Iraq would require 27 years to pay off its debts, a member of the Iraqi parliament’s Economy and Investment Committee recently stated. The parliamentarian criticized the government for continuing to take loans in order to cover the state’s debts, without formulating a plan to increase the country’s revenues. The committee further stressed its objection to additional loans and argued that developing the oil industry, as well as decreasing government expenses, should be the main focus of the government. Earlier, official sources stated that Iraq’s domestic and international debts are worth approximately $73 billion, in addition to another $40 billion that was waived by 8 states. Source: Doron Paskin, Institute for Middle East Economic Research; Photo: Walla! News

The government committee appointed by Netanyahu published a report in which it said that the factories should be closed to petrochemical activity - "as soon as possible." In addition, the committee recommends setting up a body to monitor the implementation of the plan, and that within two years a date be set for the completion of planning in the Gulf. The Israel Energy Institute: "Unprofessional decision" The CEOs' committee appointed by Prime Minister Benjamin Netanyahu regarding the Haifa Bay recommended closing down the refineries for petrochemical activities, according to a report by the committee published today (Monday). Within two years, a more detailed date will be set for the completion of planning in the Gulf, and for the cessation of petrochemical activity. "Taking the necessary steps to maintain the stability and security of the energy economy and redesign the metropolis into a quality urban location and promote economic, employment and environmental development of the Gulf region," the draft report said for public comment. Source: Walla News! 🇮🇱 IF YOU LOVE ISRAEL - SHARE NEWSRAEL! 🇮🇱

The Employment Service today publishes data on the rate of return to work among young people. Unsurprisingly, but now at least officially, it turns out that despite the wide opening of the economy - the rate of return of young people is significantly lower than expected. The data shows that despite the opening of employment industries in which young people are employed at a high rate, the age distribution of job seekers in March is the same as that recorded in February. This means that young people are not returning to work at the expected rate: during March, the restrictions of the corona were removed and the employment industries in which an over-representation of young people is normal, such as the catering, hospitality, leisure, and trade industries, were opened almost fully. Despite this, the rate of youth advocacy did not change at all compared to February; 47.4% in March compared to the exact same percentage in February. This means that young people are not returning to work. The Research and Planning Division of the Employment Service explains that the phenomenon proves that unemployment benefits have become a barrier to returning to work. This is true for young people and for other low-wage earners, not necessarily young people. Source: Walla News! 🇮🇱 IF YOU LOVE ISRAEL - SHARE NEWSRAEL! 🇮🇱

It’s not unusual to find the Jews and Arabs of Jerusalem side by side in stores, buses and trains, working together in hospitals and studying together in institutions of higher education. It is quite unusual, however, to find a Jewish and Arab duo who are close friends and startup cofounders. That’s what makes Hesham Taha and Avi Israel’s story so intriguing – and so hopeful for a shared future in this city of 936,000 people, 62 percent of whom are Jewish and 38% Arab. Their company, Teramount, connects optical fibers to silicon chips, enabling the transfer of terabytes of data at the speed of light for applications requiring high bandwidth, like 5G networks, cloud computing, data-center infrastructure and machine learning-based applications. The details are scientifically complex, but these two have years of experience in applied physics. “We know each other a long time,” Taha said. During his PhD studies at Hebrew University in 2002, Taha was working in a lab where Israel was an undergraduate assistant. Though the men are not far apart in age — Taha is now 45 and Israel is 43 — Israel had entered university after three years of military service and another year of traveling abroad. Their shared interest in physics research led to a warm working relationship. When Israel finished his PhD, he joined Taha working at Nanonics Imaging, which makes advanced scanning probe microscopy systems. “We did many travels together to conferences and to customers,” Taha says. “We often had to share the same room, or got stuck in the same airport, and our friendship deepened. We had many discussions about life and our families and how we see coexistence in this small piece of land. This is how you develop thoughts about the situation from a different perspective. We had trust in each other.” Hebrew has always been their common language. “At my previous company I was a senior employee and the only Arab,” Taha says. “Many of the employees were American immigrants and I spoke Hebrew better than they did,” he adds with a laugh. “In 2014,” Taha continues, “Avi raised an idea that we both were aware of from our work about how to connect optics to chips. We saw great potential. I decided to leave my job a year after him, and we started Teramount.” Mutual trust and respect Israel recalls, “I had a vague thought about how the microelectronic revolution would be applied to optics and communications. I needed a counterpart to help me refine it, so I talked to Hesham. We’re both men of science and knew the problem before we could identify the market.” It wasn’t long before the market materialized. To move innovation smoothly into the future, multinationals such as Intel and Cisco must overcome the data bottleneck that existing photonics aren’t reliable or scalable enough to solve. Teramount’s answer to this problem is now in the commercialization stage, working with leading vendors in the semiconductor (chip) industry. The team of eight is expected to double by the end of the year. “We are very confident that our unique approach is general enough to fit many needs,” says Israel. In 2015, the Israel Innovation Authority launched a fund supporting startups with an Arab founder, offering a low matching requirement as an enticement for outside investors. “Getting this grant was the main trigger for initiating Teramount, because deep-tech is relatively high risk for investors,” says Taha. “Also, many Arab founders did not have a previous exit and are making their first attempt. Such governmental support definitely motivates the ecosystem and supports Arab people building startups.” Jerusalem-basedTeramount recently raised $8 million in a Series A funding round led by deep-technology VC Grove Ventures with participation from Amelia Investments and former Executive VP of Intel David (Dadi) Perlmutter, Teramount’s chairman of the board. Israel is CTO and Taha is CEO. “I had the privilege of choosing my own boss,” Israel says. “I knew I wasn’t ready to be a CEO; I’m too drawn to the technical part. Hesham is more eloquent and very experienced.” The cofounders emphasize that their mutual respect and trust for one another, personally and professionally, is what makes their partnership tick. “Our families often socialize. Hesham’s son and my daughter were born about a week apart,” says Israel, whose daughter attends the bicultural Hand in Hand school in Jerusalem. “Our friendship is a benefit but it’s about knowing the whole person. The trust and confidence you must have in a cofounder takes some of the risk off the table.” Source: Israel 21c

The Bank of Israel held its benchmark interest rate at 0.1% for an eighth straight meeting on Monday, citing a rapid economic recovery from the COVID-19 pandemic and expectations that inflation will continue to rise. "The opening of the economy and the return to normal life in Israel are expected to support continued rapid growth in the coming year," the central bank said, noting challenges remain regarding the labor market. "The committee will therefore continue to conduct a very accommodative monetary policy for a prolonged time," and use rates and other tools to support policy targets, it said. The bank's staff forecast the key rate will stay at 0.1% for the coming year, with economists widely expecting the next move to be a rate increase in 2022 or 2023. Source: Reuters 🇮🇱 IF YOU LOVE ISRAEL - SHARE NEWSRAEL! 🇮🇱

The consumer price index rose by 0.6% in March, the Central Bureau of Statistics announced today (Wednesday). Significant price increases were recorded in the clothing sections 5.8%, culture and entertainment 2.2%, transportation 0.9%, furniture and household equipment 0.8% and housing 0.6%. Since the beginning of the year, the consumer price index has risen by 0.8%.

Iran-backed Hezbollah has officially launched a supermarket chain in Lebanon called al-Sajad to provide cheap products to its supporters as part of plans that critics say are designed to develop another parallel economy of its own. Hezbollah supporters celebrated the opening of al-Sajjad cooperatives, where they shared photos of the launch of the first branch near the airport, calling for "focusing on the term branch," referring to the series of supermarkets that opened. Lebanon is experiencing an unprecedented economic crisis caused by decades of corruption and mismanagement due to the instability caused by the country’s sectoral political system. The crisis was exacerbated by the Coronavirus epidemic and a huge explosion in the port of Beirut last August that left 300,000 displaced, more than 2,000 injured, and at least 200 dead. The crisis has caused a 10-fold drop in the Lebanese currency, putting nearly half of the population below the poverty line, according to the World Bank. Hezbollah opponents criticized the establishment of the supermarket, saying the terrorist organization "needed to work with its parliamentary majority and the Lebanese government to establish an aid program for all Lebanese in order to minimize the consequences of the economic crisis they caused." Hezbollah, which has distributed al-Sajad cards to tens of thousands of people, brings customers to shopping malls to maintain cash flow in its controlled business environment. By entering the supermarket business, Hezbollah will attract consumers who will inevitably buy from those stores that receive their own brand with prepaid tickets. Source: Nziv 🇮🇱 IF YOU LOVE ISRAEL - SHARE NEWSRAEL! 🇮🇱

On New Year's Eve, Carmel Shama-Cohen, Mayor of Ramat Gan, posted on his Facebook page excited words of praise for the newly approved "Triangle of the Exchange" program. The plan is currently being promoted to the stock exchange, and it will allow three times the size of the built-up area to be added, and will add extra high towers, which will have office, commercial, residential and public space. This is Ramat Gan taking full advantage of its position being close to the center. Source: Walla! News.

Tesla to open a pop-up shop in Tel Aviv mall The company under the direction of Elon Musk will enter the Israeli vehicle market this month (January), with the first Tesla pop-up store in Ramat Aviv mall. Tesla's global expansion included European Series 3 that presents relatively compact cars. Last September, 17,490 cars of this model were sold in Europe alone, making it the best-selling electric car that month. Since the beginning of the year, approximately 75,000 Tesla vehicles have been sold in Europe. Tesla's entry into small markets comes as a result of a growing customer demand. About three years ago the company entered Jordan's market. Source: Walla news