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Scoot CEO Wilson appointed head of Air India

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© Reuters. FILE PHOTO: Scoot, Jetstar and Singapore Airlines planes sit on the tarmac at Singapore’s Changi Airport, Singapore January 18, 2021. REUTERS/Edgar Su

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By Jamie Freed and Chandini Monnappa

(Reuters) -Air India’s new owner Tata Sons said on Thursday it would appoint Campbell Wilson, the head of Singapore Airlines (OTC:SINGY)’ budget carrier Scoot, as its chief executive, subject to regulatory approvals.

New Zealand-born Wilson, 50, will step down from his current role on June 15, Singapore Airlines said.

Tata Sons completed its purchase of the previously state-owned Indian national carrier in January and has been searching for an executive to lead a major turnaround plan.

Air India, with its maharajah mascot, was once renowned for its lavishly decorated planes and stellar service championed by the airline’s founder, JRD Tata, India’s first commercial pilot.

But since the mid-2000s, its reputation has fallen as financial troubles have mounted.

Wilson’s appointment comes after Turkey’s Ilker Ayci decided not to take on the role of chief executive of Air India after the announcement of his appointment spurred opposition in India over his previous political links.

Air India Chairman N. Chandrasekaran said he was delighted to welcome Wilson, describing him as an industry veteran who had worked in key global markets across many functions.

Wilson, a long-time Singapore Airlines executive, was the founding CEO of Scoot and helped build a casual and irreverent culture at the budget carrier within a broader, more conservative organisation best known for its focus on the premium market.

“Air India is at the cusp of an exciting journey to become one of the best airlines in the world, offering world-class products and services with a distinct customer experience that reflects Indian warmth and hospitality,” Wilson said in a statement. “I am excited to join Air India and Tata colleagues in the mission of realising that ambition.”

Tata Sons said Air India’s board approved the appointment of Wilson, subject to the requisite regulatory approvals.

The appointment of a foreign national as CEO of an airline in India requires government clearance before it can proceed.

Wilson will be replaced at Scoot by Leslie Thng, 47, current senior vice president of sales and marketing, at Singapore Airlines. Thng once headed Vistara, an Indian airline owned jointly by Tata Sons and Singapore Airlines that is operated separately from Air India.

Economy

World Bank to offer $30 billion as Ukraine war threatens food security

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© Reuters. FILE PHOTO: The United States Department of the Treasury is seen in Washington, D.C., U.S., August 30, 2020. REUTERS/Andrew Kelly

By David Lawder

BONN (Reuters) -The World Bank said on Wednesday it will make $30 billion available to help stem a food security crisis threatened by Russia’s war in Ukraine, which has cut off most grain exports from the two countries.

The total will include $12 billion in new projects and over $18 billion funds from existing food and nutrition-related projects that have been approved but have not yet been disbursed, the bank said.

“Food price increases are having devastating effects on the poorest and most vulnerable,” said World Bank Group President David Malpass said in a statement. “To inform and stabilize markets, it is critical that countries make clear statements now of future output increases in response to Russia’s invasion of Ukraine.”

The bank said the new projects are expected to support agriculture, social protection to cushion the effects of higher food prices on the poor, and water and irrigation projects. The majority of resources going to Africa and the Middle East, Eastern Europe and Central Asia, and South Asia.

These areas are among the hardest hit by the impact of the war in Ukraine on grain supplies. Countries such as Egypt are highly dependent on Ukrainian and Russian wheat and are scrambling for supplies as Russia has blockaded Ukraine’s agricultural exports from Black Sea ports and has imposed domestic export restrictions.

The World Bank’s plans were the largest component of a U.S. Treasury Department report summarizing food security action plans from international financial institutions released on Wednesday.

The European Bank for Reconstruction and Development plans to make 500 million euros ($523.50 million) available for food security and trade finance for agricultural and food products, out of a 2 billion euro package for Ukraine and neighboring countries affected by the war, the Treasury report said. Ukraine would get 200 million euros and neighboring countries would get 300 million euros.

The International Monetary Fund will provide financing support through its normal channels, which are limited by countries’ shareholdings and whether their debt is deemed sustainable.

($1 = 0.9551 euros)

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Economy

Exclusive-Japan Inc turns against central bank’s monetary stimulus, Reuters survey shows

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© Reuters. FILE PHOTO: A businessman walks near the Bank of Japan headquarters in Tokyo, Japan, Feb. 15, 2016. REUTERS/Thomas Peter

By Tetsushi Kajimoto

TOKYO (Reuters) – More than 60% of Japanese companies want the central bank to end its policy of massive monetary easing this fiscal year due to pain from the weak yen, with roughly a quarter calling for it to take action now, a Reuters survey shows.

Less than a year ago, Japan Inc had enthusiastically backed the Bank of Japan’s policy but this year’s rapid slide in the yen to a two-decade low has jacked up prices of fuel and raw materials imports, lifting not only corporate costs but also hitting household spending.

This month the yen hit a fresh low of 131.34 to the dollar, a 14% decline since the start of the year.

“Any weakening of the yen beyond 125 to the dollar is excessive and policymakers should take action in some way, including – but not limited to – hiking rates,” one manager at a chemicals maker wrote in the monthly Reuters Corporate Survey.

Twenty-four percent of respondents said the central bank should abandon large-scale monetary stimulus now, while 23% said by the end of the first half in September.

All in all, 64% want large-scale stimulus gone by March when the fiscal year ends and that number jumps to 84% for April when BOJ Governor Haruhiko Kuroda serves out his term.

While Kuroda has said the yen’s moves have been rapid, he argues that a weak yen on the whole benefits the economy. In stark contrast to shifts to interest hikes in other parts of the world, Kuroda has also said the central bank will continue with monetary powerful easing given the impact of the pandemic and tepid inflation.

Of those respondents keen to see a change in BOJ policy, 58% want to see negative rates scrapped, 35% want interest rates hiked and 25% are eager to see the bank drop or change its 2% inflation target. Multiple answers were allowed for this question.

The results of the April 26-May 13 poll of 500 large and midsize non-financial firms, which saw 230 firms respond, represent a major U-turn from July when the survey last asked comparable questions about monetary policy.

At that time, 72% of Japanese firms saw a positive impact from BOJ policy with a majority saying ultra-low rates should continue for another 3-4 years.

The sharpness of the currency’s decline has outweighed the benefits normally associated with a weaker yen, namely the inflation of profits earned abroad when repatriated and longer term the ability to export more cheaply. Japanese exporters have also continued to shift production abroad.

“As the production shift continues, the impact on the economy from higher raw materials costs and other imports from the weaker yen is greater than the apparent increase in profits for exporters,” said one manager at a retailer.

Respondents reply to the survey on condition of anonymity.

BOJ SLAMMED

Some managers were withering in their criticism of BOJ policy, expressing concern the weak yen could ultimately erode Japan’s economic might.

“The easing policy has turned out to be nothing but a stupid plan that weakens national power,” one manager at a services firm wrote.

The survey also found firms wary of boosting capital spending due to the impact of the weak yen and rising input costs. Almost a half of them plan to keep business investment flat this fiscal year while another 14% expect it to decline.

The survey also showed that China’s anti-COVID measures – including a lockdown in Shanghai – have hurt nearly two-thirds of Japanese firms. Ten percent said they were suffering a “big impact” on business.

“Imports of China-produced car parts have stopped, putting downward pressure on car output,” a chemicals maker manager wrote.

($1 = 129.02 yen)

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Economy

Brazil’s govt will maintain GDP outlook for 2022 and 2023 -sources

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© Reuters. FILE PHOTO: Consumers shop at a weekly street market in Rio de Janeiro, Brazil, September 2, 2021. REUTERS/Ricardo Moraes

By Marcela Ayres

BRASILIA (Reuters) – Brazil’s Economy Ministry will hold its economic growth outlook at 1.5% in 2022 and 2.5% in 2023, two officials told Reuters on Wednesday, forecasting activity ahead of market projections due to labor market strength and growing private investments.

The ministry will update its forecasts for economic indicators on Thursday and inflation figures are expected to be lifted from the previous outlook, in March, when the IPCA consumer price index was seen at 6.55% this year.

Data will be used in the bi-monthly income and expenditure report calculations, scheduled for Friday.

Economists have been increasing their forecasts for this year’s GDP, bringing the numbers closer to those forecast by the government.

Analysts say demand in the country has been helped by greater fiscal stimulus, following an increase in a cash transfer program to poorer people. In addition, the job market has shown signs of strength and the Omicron coronavirus wave has not knocked social mobility as feared.

However, they say expectations for 2023 have deteriorated, with aggressive central bank monetary tightening to tame inflation set to affect activity from the second half of the year onwards.

The central bank has raised interest rates to 12.75% from a record-low 2% in March 2021, and has already signaled another likely hike in June.

Goldman Sachs (NYSE:GS) and Credit Suisse now see Brazil’s GDP rising 1.25% and 1.4% this year, respectively, against previous 0.6% and 0.2% projections. For 2023, Goldman Sachs lowered its forecast to 0.9% from 1.2%, while Credit Suisse cut its outlook to 0.9% from 2.1%.

Bank of America (NYSE:BAC) projected on Tuesday that Brazil will grow 1.5% in 2022 from 0.5% earlier. However, expansion is now seen at 0.9% in 2023, from 1.8% previously.

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