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Category: Pandemic

  • MIL-OSI Asia-Pac: Tourism Board Chairman named

    Source: Hong Kong Information Services

    The Government today announced the appointment of Peter Lam to succeed Pang Yiu-kai as Chairman of the Hong Kong Tourism Board (HKTB). Mr Lam’s appointment is effective from April 1, 2025 until March 31, 2028.

    In addition, Jeffrey Lam, Nikki Ng and Melissa Pang were announced as new members of the HKTB, effective from April 1, 2025 until March 31, 2027.

    Secretary for Culture, Sports & Tourism Rosanna Law commented that Peter Lam, who previously served as the board’s chairman previously, possesses rich experience in promoting tourism in Hong Kong.

    “With his diverse experiences in business management and public services, along with a strong vision, Mr Lam is the best candidate to lead the HKTB and the tourism sector of Hong Kong to reach new heights.

    “Under his leadership, the board will advance further while promoting Hong Kong worldwide and showcasing its charms, so that visitors will indulge in pleasure when staying in this city, thinking about it, and returning time and again.”

    Miss Law expressed her gratitude to Pang Yiu-kai for his distinguished contributions to the HKTB, stating that his exemplary leadership helped the board to overcome various challenges during the pandemic and subsequently to drive a recovery in Hong Kong tourism.

    She also welcomed the three new appointees, and thanked outgoing member Lam Ho-yi for her contributions to the board’s work.

    Appointments to the Tourism Board are made by Chief Secretary in exercise of powers delegated by Chief Executive and pursuant to section 9 of the Hong Kong Tourism Board Ordinance.

    MIL OSI Asia Pacific News –

    February 19, 2025
  • MIL-OSI: Orca Energy Group Inc. Announces Independent Reserves Evaluation for Year End 2024

    Source: GlobeNewswire (MIL-OSI)

    TORTOLA, British Virgin Islands, Feb. 18, 2025 (GLOBE NEWSWIRE) — February 19, 2025 – Orca Energy Group Inc. (“Orca” or the “Company” and includes PanAfrican Energy Tanzania Limited (“PAET“) and its other subsidiaries and affiliates) (TSX-V: ORC.A, ORC.B) announces the approval of its Independent Reserves Evaluation as at December 31, 2024. All currency amounts in this news release are in United States Dollars ($) unless otherwise stated.

    INDEPENDENT RESERVES EVALUATION
    The Company’s conventional natural gas reserves as at December 31, 2024 for the period to the end of the primary 25-year term of the production sharing agreement (the “Songo Songo PSA“) with the Tanzanian Petroleum Development Corporation (the “TPDC“) have been evaluated by independent petroleum engineering consultants McDaniel & Associates Consultants Ltd. (“McDaniel“), an independent reserves evaluator, in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook (“COGE Handbook“) and National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (“NI 51-101“). The Songo Songo PSA expires upon the expiry of TPDC’s Songo Songo licence in respect of the Songo Songo gas field (the “Songo Songo Licence“) in October 2026. The preparation date of the independent reserves evaluation prepared by McDaniel is February 18, 2025 and the effective date of the evaluation is December 31, 2024 (the “McDaniel Report“).

    All of the Company’s reserves are located in Tanzania. Reserves included herein are stated on a Company gross reserves basis unless noted otherwise. Company gross reserves are the total of the Company’s working interest share in reserves.

    The Company’s Board of Directors has reviewed and approved the McDaniel Report. Additional reserves information required under NI 51-101 is included in Orca’s reports relating to reserves data and other oil and gas information under NI 51-101, which will be filed on its profile on SEDAR+ at www.sedarplus.ca. The following discussion is subject to a number of cautionary statements, assumptions, contingencies and risks as set forth in this news release.

    HIGHLIGHTS

    • Total Proved (“1P”) Gross Company conventional natural gas reserves at year ended December 31, 2024, were 40.2 billion standard cubic feet (“Bcf“) compared to 85.0 Bcf at year end 2023, representing a 53% decrease.
    • Total Proved plus Probable (“2P”) Gross Company conventional natural gas reserves at year ended December 31, 2024, were 41.5 Bcf compared to 93.9 Bcf at year end 2023, representing a 56% decrease.
    • The Company estimated gas sales of 26.7 Bcf in 2024, representing a decrease of approximately 15% compared to year end 2023. The reduction in Gross Company 1P reserves from year end 2023 to year end 2024 was primarily attributed to 26.7 BCF of production in 2024 and 18.1 Bcf of negative technical revisions. The technical revisions were primarily due to lower forecasted gas sales to the end of the license (October 2026) attributed to increased hydro power in Tanzania and the removal of Proved Undeveloped reserves due to the unsuccessful well intervention on SS-7.
    • Net present value of 1P future net revenue discounted at 10% was $61.8 million at year end 2024, compared to $108.4 million at year end 2023, representing a 43% decrease.
    • Net present value of 2P future net revenue discounted at 10% was $64.7 million at year end 2024, compared to $118.7 million at year end 2023, representing a 45% decrease.
    • The 43% reduction in net present value of 1P future net revenues from year end 2023 to year end 2024 was primarily attributed to lower reserves at year end 2024 and the associated 33% reduction in the number of years outstanding on the current Songo Songo Licence.
    • The following tables outline the Company’s conventional natural gas reserves as at December 31, 2024 and the net present value of future net revenue attributable to such reserves as evaluated in the McDaniel Report utilizing McDaniel’s forecast price and cost assumptions to the end of the Songo Songo Licence term in October 2026.
      Company Gross Reserves   Company Net Reserves
      Conventional.

    Natural Gas

      Conventional.

    Natural Gas

      MMcf   MMcf
    Proved      
      Developed Producing 40,244   28,020
      Developed Non-Producing –   –
      Undeveloped –   –
    Total Proved 40,244   28,020
    Probable 1,224   803
    Total Proved plus Probable 41,469   28,823

    Net Present Value of Future Net Revenue of Gas Reserves

        Before and After Future Income Tax Expenses Discounted at   Unit Value
          Before and
    After Tax at
    10%
        0 %   5 %   10 %   15 %   20 %   $/Mcf
    ($’000)                        
    Proved                        
    Developed Producing   67,574     64,549     61,824     59,357     57,112     2.21
    Developed Non-Producing   –     –     –     –     –     –
    Undeveloped   –     –     –     –     –     –
    Total Proved   67,574     64,549     61,824     59,357     57,112     2.21
    Probable   3,160     3,016     2,887     2,769     2,663     3.60
    Total Proved plus Probable   70,735     67,565     64,710     62,126     59,775     2.25

    Notes:

    1. During the third quarter of 2015, The Petroleum Act, 2015 (the “Act“) was passed into law by Presidential decree. The Act repeals earlier legislation, provides a regulatory framework over upstream, mid-stream and downstream gas activity, and as well consolidates and puts in place a single, effective and comprehensive legal framework for regulating the oil and gas industry in Tanzania. The Act also provides for the creation of an upstream regulator, the Petroleum Upstream Regulatory Authority. The mid and downstream petroleum as well as gas activities are proposed to be regulated by the current authority, the Energy and Water Utilities Regulatory Authority (“EWURA“). The Act also confers upon on the TPDC the status of the National Oil Company, mandated with the task of managing the country’s commercial interest in the petroleum operations as well as mid and downstream natural gas activities. The Act vests TPDC with exclusive rights in the entire petroleum upstream value chain and the natural gas mid and downstream value chain. However, the exclusive rights of TPDC do not extend to mid and downstream petroleum supply operations. The Act does provide grandfathering provisions upholding the rights of the Company under the Songo Songo PSA as it was signed prior to the passing of the Act.
    2. On October 7, 2016, the Government of Tanzania issued the Petroleum (Natural Gas Pricing) Regulation made under Sections 165 and 258 (1) of the Act (the “Natural Gas Pricing Policy“). Article 260(3) of the Act preserves the Company’s pre-existing right with TPDC to market and sell natural gas together or independently on terms and conditions (including prices) negotiated with third party natural gas customers. To date, the Natural Gas Pricing Policy has not impacted the Company’s ability to market and sell natural gas at prices freely negotiated with natural gas customers. The future impact of the Natural Gas Pricing Policy, if any, cannot be determined at this time.
    3. On January 16, 2018, Orca sold (the “First Swala Transaction“) 7.933 percent of the Class A common shares (7,933 Class A common shares) of its wholly owned subsidiary PAE PanAfrican Energy Corporation (“PAEM“), a Mauritius registered Company and sole shareholder of PAET, a Jersey registered Company, to a wholly owned subsidiary of Swala. The Songo Songo PSA is held by PAET. While Swala had no management or control of PAEM and no shareholding in, or management or control of PAET, the McDaniel Report was previously prepared based on Orca’s ownership of 92.07 percent of PAET’s gross reserves. On July 21, 2023, the Company repurchased (the “Second Swala Transaction”) the 7.933% shares in PAEM eliminating Swala’s interest in the reserves. Accordingly, the 2024 McDaniel Report is prepared based on Orca’s ownership of 100% of PAET’s gross reserves.
    4. “Company Gross Reserves” are the total of the Company’s working interest share in reserves before deduction of royalties owned by others and without including any royalty interests of the Company.
    5. “Company Net Reserves” are the total of the Company’s working interest share in reserves after deducting the amounts attributable to royalties and Profit Gas owned by others (as defined in the PSA), plus the Company’s royalty interests in such reserves.
    6. Company Gross and Net Reserves are based on the Company’s 100 percent ownership interest in the reserves following the Second Swala Transaction.
    7. Under the terms of the Songo Songo Production Sharing Agreement with TPDC and the Government of Tanzania (“PSA“), the Company is required to pay Tanzanian income tax, but this is recovered by the Company through the profit sharing arrangements with TPDC. Where income tax is accrued, the Company’s revenue will be grossed up by the tax due and the tax will be shown as a tax in the Company’s accounts. However, the income tax has no material impact on the cash flows emanating from the PSA and accordingly it has not been identified as a separate cash flow stream in the analysis of the net present values.

    McDaniel employed the following gas sales, pricing and inflation rate assumptions as of December 31, 2024 in estimating the Company’s reserves data using forecast prices and costs. The Company received an average gas price of $4.67/Mcf in 2024 and $4.22/Mcf net of the transportation tariff imposed by Songas Limited as determined by the energy regulator, EWURA.

        Songo Songo gas prices  

    Year

    Brent crude

    $/bbl

    Proved

    $/Mcf

    Proved plus probable

    $/Mcf

    Annual inflation

    %

     
               
    2025 76.50 5.15 5.20 2  
    2026 78.03 5.25 5.32 2  
               

    Note:   Brent price forecast based on the McDaniel January 1, 2025 price forecast.

    The price of gas for the Industrial sector is based on a formula related to discounts to heavy fuel oil prices and includes caps and floors. This has been reflected in the above pricing.

    Orca Energy Group Inc.

    Orca is an international public company engaged in natural gas development and supply in Tanzania through its subsidiary PAET. Orca trades on the TSX Venture Exchange under the trading symbols ORC.A and ORC.B.

    For further information please contact:

    Jay Lyons                                
    Chief Executive Officer                        
    +44 (0)20 8434 2754                        
    ir@orcaenergygroup.com                 

    For media enquiries:
    Celicourt (PR)
    Mark Antelme
    Jimmy Lea
    Orca@celicourt.uk
    +44 (0)20 8434 2754

    Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

    Abbreviations

    bbl cubic meters
    Mcf thousand cubic feet
    MMcf million standard cubic feet


    Forward Looking Information

    Certain information regarding Orca set forth in this news release contains forward-looking information and statements as defined under applicable securities laws (collectively, “forward-looking statements” or “statements“) that involve substantial known and unknown risks and uncertainties. The use of any of the words “plan”, “expect”, “prospective”, “project”, “intend”, “believe”, “should”, “anticipate”, “estimate” or other similar words, or statements that certain events or conditions “may” or “will” occur are intended to identify forward-looking statements. These statements are only predictions and actual events or results may differ materially. Although the Company’s management believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievement since such expectations are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause Orca’s actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, Orca.

    In particular, statements relating to “reserves” are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions that the resources described exist in the quantities predicted or estimated, and that the resources described can be profitably produced in the future. Additional forward-looking statements in this news release include statements regarding: expectations regarding demand for natural gas and the implications of decreasing demand; expiration of the Songo Songo PSA and the Songo Songo Licence and pending extension of the Songo Songo Licence and Songo Songo PSA; reserves and future net revenue from the Company’s reserves; assumptions regarding the increased demand for hydro power in Tanzania; and assumptions regarding gas sales, pricing and inflation rates.

    These forward-looking statements are subject to numerous risks and uncertainties, including but not limited to risks and uncertainties regarding or associated with: drilling wells, including the costs of drilling and whether development drilling results in commercially productive quantities of oil and gas; the terms of Orca’s future petroleum contracts, including potential obligations to drill wells and declare discoveries in order to retain Orca’s exploration and production rights; Orca’s local operational dependence and focus of its existing contracts; Orca’s future control over the Songo Songo Licence areas and facilities, including its status as operator thereof, and the timing and extent of costs in association therewith; estimations of reserves and the present value of future net revenues derived from them; Orca’s dependency on its management and technical team; Orca’s business plan including the additional capital required to execute such plans; commercializing Orca’s interests in any hydrocarbons produced from future licence areas; Orca’s ability to access appropriate equipment and infrastructure in a timely manner; the exploration and production of oil and natural gas, including but not limited to drilling and other operational and environmental risks and hazards; severe weather including but not limited to tropical storms and hurricanes; disagreements with TPDC regarding the Songo Songo PSA; the political and economic circumstances in the countries in which Orca operates; disputes with the Government of Tanzania; technological development; activism against oil and exploration and development; limitations on insurance coverage; Orca’s operations in a litigious environment; global populism; Orca’s future capitalization which may include additional indebtedness; acquisitions and the integration of any target entity or business into Orca’s current business; cybersecurity and data breaches; impacts of pandemics; share price volatility and dilution; Orca’s controlling shareholder and its control over key decision making as a result of its control of a majority of the voting rights attached to Orca’s issued and outstanding securities; Orca’s status as a holding company that’s ability to declare and pay dividends and purchase its own securities is dependent upon the receipt of funds from Orca’s subsidiaries by way of dividends, fees, interest, loans or otherwise; the impact of general economic conditions, including global and local oil and gas prices; industry conditions including changes in laws and regulations, and changes in how they are interpreted and enforced; competition; lack of availability of qualified personnel; risks related to obtaining required approvals of regulatory authorities; risks associated with negotiating with governments and other counterparties; fluctuations in foreign exchange or interest rates; risks and uncertainties associated with obtaining an extension to the Songo Songo PSA and related Songo Songo Licence or successfully renegotiating them; changes in income tax laws or tax rates; ability to access sufficient capital from internal and external sources; associated with the failure of counterparties to perform under the terms of their contracts, including collectability of Orca’s receivables from such parties; reduced global economic activity as a result of global pandemics, including lower demand for natural gas and a reduction in the price of natural gas; prolonged deficiency in Tanzania’s official reserve and foreign exchange losses; political instability and the impacts of the Russian-Ukrainian conflict, the Israel-Hamas conflict, conflicts in the Middle East and related actions; and other factors, many of which are beyond the control of the Company. Readers are cautioned that the foregoing list of factors is not exhaustive.

    Although the forward-looking statements contained in this news release are based upon assumptions which management believes to be reasonable, Orca cannot assure investors that actual results will be consistent with these forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements included in this news release, as there can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur. With respect to forward-looking statements contained in this news release, Orca has made assumptions regarding, among other things: continued and timely development of infrastructure in areas of new production; obtaining an extension to the Songo Songo PSA and related Songo Songo Licence on terms acceptable to Orca; accuracy of estimates of Orca’s reserves volumes; the impact of any pandemics or political conflicts on the demand for and price of natural gas, volatility in financial markets, disruptions to global supply chains and the Company’s business, operations, access to customers and suppliers, availability of employees to carry out day-to-day operations, and other resources; future commodity prices and commodity price fluctuations; availability of skilled labour; availability of transactions to facilitate Orca’s growth strategy; growth of demand and consumption of natural gas in Tanzania and throughout Africa; the impact of increasing competition; conditions in general economic and financial markets; effects of regulation by governmental agencies; receipt of partner, regulatory and community approvals; future operating costs; effects of regulation by governmental agencies; that Orca’s conduct and results of operations will be consistent with its expectations; current or, where applicable, proposed industry conditions, laws and regulations will continue in effect or as anticipated as described herein; and other matters. There are a number of assumptions associated with the development of the evaluated areas, including continued performance of existing wells, future drilling programs and performance from new wells, the growth of infrastructure, well density per section, and recovery factors and development necessary involves known and unknown risks and uncertainties, including those risks identified in this news release. Orca believes the material factors, expectations and assumptions reflected in the forward-looking information are reasonable but no assurance can be given that these factors, expectations and assumptions will prove to be correct.

    Management has included the above summary of assumptions and risks related to forward-looking information provided in this news release in order to provide investors with a more complete perspective on Orca’s current and future operations and such information may not be appropriate for other purposes. Orca’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do, what benefits Orca will derive. These forward-looking statements are made as of the date of this news release and Orca disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws. The forward-looking statements contained in this news release are expressly qualified by this cautionary statement.

    Oil and Gas Advisory

    The Company’s conventional natural gas reserves as at December 31, 2024 disclosed herein were evaluated by McDaniel in accordance with the definitions, standards and procedures contained in the COGE Handbook and NI 51-101. The McDaniel Report had an effective date of December 31, 2024. The Company’s conventional natural gas reserves as at December 31, 2023 disclosed herein were evaluated by McDaniel in accordance with the definitions, standards and procedures contained in the COGE Handbook and NI 51-101. Such report had an effective date of December 31, 2023.

    Additional reserves information required under NI 51-101 are included in Orca’s reports relating to reserves data and other oil and gas information under NI 51-101, which are filed on its profile on SEDAR at www.sedar.com.

    This news release contains estimates of the net present value of Orca’s future net revenue from the Company’s reserves. The net present value of future net revenue attributable to the Company’s reserves is stated without provision for interest costs and out of country general and corporate administrative costs, but after providing for estimated royalties, production costs, development costs, other income and future capital expenditures. It should not be assumed that the undiscounted or discounted net present value of future net revenue attributable to the Company’s reserves estimated by McDaniel represent the fair market value of those reserves. Such amounts do not represent the fair market value of the Company’s reserves. The recovery and reserve estimates of the Company’s conventional natural gas reserves provided herein are estimates only and there is no guarantee that the estimated reserves will be recovered. Actual reserves may be greater than or less than the estimates provided herein.

    The MIL Network –

    February 19, 2025
  • MIL-OSI: CVR Energy Reports Fourth Quarter and Full-Year 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    • Reported full-year 2024 net income attributable to CVR Energy stockholders of $7 million and EBITDA of $394 million.
    • Paid cumulative cash dividends attributable to 2024 of $1.00 per share.
    • Enhanced liquidity by $408 million in the fourth quarter of 2024 through a Term Loan and the sale of our 50 percent interest in Midway Pipeline.

    SUGAR LAND, Tx, Feb. 18, 2025 (GLOBE NEWSWIRE) — CVR Energy, Inc. (“CVR Energy” or the “Company”) (NYSE: CVI) today announced fourth quarter 2024 net income attributable to CVR Energy stockholders of $28 million, or 28 cents per diluted share, compared to fourth quarter 2023 net income attributable to CVR Energy stockholders of $91 million, or 91 cents per diluted share. Adjusted loss for the fourth quarter of 2024 was 13 cents per diluted share compared to adjusted earnings of 65 cents per diluted share in the fourth quarter of 2023. Net income for the fourth quarter of 2024 was $40 million, compared to net income of $97 million in the fourth quarter of 2023. Fourth quarter 2024 EBITDA was $122 million, compared to fourth quarter 2023 EBITDA of $204 million. Adjusted EBITDA for the fourth quarter of 2024 was $67 million, compared to adjusted EBITDA of $170 million in the fourth quarter of 2023.

    For full-year 2024, the Company reported net income attributable to CVR Energy stockholders of $7 million, or 6 cents per diluted share, compared to net income attributable to CVR Energy stockholders for full-year 2023 of $769 million, or $7.65 per diluted share. Adjusted loss for full-year 2024 was 51 cents per diluted share compared to adjusted earnings of $5.64 per diluted share for full-year 2023. Net income for full-year 2024 was $45 million, compared to net income of $878 million for full-year 2023. Full-year 2024 EBITDA was $394 million, compared to full-year 2023 EBITDA of $1.4 billion. Adjusted EBITDA for full-year 2024 was $317 million, compared to adjusted EBITDA of $1.2 billion for full-year 2023.

    “CVR Energy’s 2024 full-year and fourth quarter results for its refining business were lower than the previous year due to reduced crack spreads and, to a lesser degree, decreased throughputs,” said Dave Lamp, CVR Energy’s Chief Executive Officer. “We commenced our planned Coffeyville turnaround early, which should position us well for the improvement in cracks we expect as summer driving season begins and capacity rationalization occurs.

    “CVR Partners operated well during 2024, with consolidated ammonia plant utilization of 96 percent,” Lamp said. “The Partnership is pleased to have declared a fourth quarter 2024 cash distribution of $1.75 per common unit, with cumulative cash distributions of $6.76 per common unit for 2024.”

    Petroleum Segment

    Fourth Quarter 2024 Compared to Fourth Quarter 2023

    The Petroleum Segment reported fourth quarter 2024 net income of $35 million and EBITDA of $72 million, compared to net income of $158 million and EBITDA of $196 million for the fourth quarter of 2023. Adjusted EBITDA for the Petroleum Segment was $9 million for the fourth quarter of 2024, compared to $152 million for the fourth quarter of 2023.

    Combined total throughput for the fourth quarter of 2024 was approximately 214,000 barrels per day (“bpd”), compared to approximately 223,000 bpd of combined total throughput for the fourth quarter of 2023.

    Refining margin for the fourth quarter of 2024 was $165 million, or $8.37 per total throughput barrel, compared to $307 million, or $15.01 per total throughput barrel, during the same period in 2023. Included in our fourth quarter 2024 refining margin were favorable mark-to-market impacts on our outstanding Renewable Fuel Standard (“RFS”) obligation of $57 million, unfavorable derivative impacts of $6 million from open crack spread swap positions and unfavorable inventory valuation impacts of $12 million. Excluding these items, adjusted refining margin for the fourth quarter of 2024 was $6.45 per barrel, compared to an adjusted refining margin per barrel of $12.91 for the fourth quarter of 2023. The decrease in adjusted refining margin per barrel was primarily due to a decrease in the Group 3 2-1-1 crack spread.

    Full-Year 2024 Compared to Full-Year 2023

    The Petroleum Segment reported full-year 2024 net income of $70 million and EBITDA of $223 million, compared to net income of $1.1 billion and EBITDA of $1.2 billion for full-year 2023. Adjusted EBITDA for the Petroleum Segment was $138 million for full-year 2024, compared to $903 million for full-year 2023.

    Combined total throughput for full-year 2024 was approximately 196,000 bpd, compared to approximately 208,000 bpd for full-year 2023.

    Refining margin was $684 million, or $9.53 per total throughput barrel, for full-year 2024 compared to $1.7 billion, or $21.82 per total throughput barrel, for full-year 2023. Included in our full-year 2024 refining margin were favorable mark-to-market impacts on our outstanding RFS obligation of $89 million, unfavorable derivative impacts of $22 million from open crack spread swap positions, and unfavorable inventory valuation impacts of $6 million. Excluding these items, adjusted refining margin for full-year 2024 was $8.67 per barrel, compared to an adjusted refining margin per barrel of $18.11 for full-year 2023. The decrease in adjusted refining margin per barrel was primarily due to a decrease in the Group 3 2-1-1 crack spread.

    Renewables Segment

    Effective for the year ended December 31, 2024, and due to the prominence of the renewables business relative to the Company’s overall 2024 performance, we have revised our reportable segments to reflect a new reportable segment – Renewables. The Renewables Segment includes the operations of the renewable diesel unit and renewable feedstock pretreater at the refinery in Wynnewood, Oklahoma.

    Fourth Quarter 2024 Compared to Fourth Quarter 2023

    The Renewables Segment reported fourth quarter 2024 net loss of $3 million and EBITDA of $3 million, compared to net loss of $30 million and EBITDA loss of $26 million for the fourth quarter of 2023. Adjusted EBITDA for the Renewables Segment was $9 million for the fourth quarter of 2024, compared to Adjusted EBITDA loss of $17 million for the fourth quarter of 2023.

    Total vegetable oil throughput for the fourth quarter of 2024 was approximately 187,000 gallons per day (“gpd”), compared to approximately 200,000 gpd for the fourth quarter of 2023.

    Renewables margin was $14 million, or 79 cents per vegetable oil throughput gallon, for the fourth quarter of 2024 compared to a loss of $17 million, or 90 cents per vegetable oil throughput gallon, for the fourth quarter of 2023. Factors contributing to our fourth quarter 2024 renewables margin were lower cost of sales of $46 million due to a decrease in vegetable oil feed prices and an increase in the Heating Oil – Bean Oil (“HOBO”) spread of 7 cents per gallon driven by a decrease in soybean oil prices of 9 cents per pound due to increased U.S. soybean oil inventories resulting from higher production levels.

    Full-Year 2024 Compared to Full-Year 2023

    The Renewables Segment reported full-year 2024 net loss of $21 million and EBITDA of $3 million, compared to net loss of $36 million and EBITDA loss of $17 million for full-year 2023. Adjusted EBITDA for the Renewables Segment was $10 million for full-year 2024, compared to Adjusted EBITDA loss of $5 million for full-year 2023.

    Total vegetable oil throughput for full-year 2024 was approximately 151,000 gpd, compared to approximately 226,000 gpd for full-year 2023.

    Renewables margin was $44 million, or 80 cents per vegetable oil throughput gallon, for full-year 2024 compared to $22 million, or 27 cents per vegetable oil throughput gallon, for full-year 2023. Factors contributing to our full-year 2024 renewables margin were favorable cost of sales of $284 million due to lower vegetable oil feed prices, an increase in the HOBO spread of 59 cents per gallon driven by a decrease in soybean oil prices of 14 cents per pound due to increased U.S. soybean oil inventories resulting from higher production levels and an increase in renewable diesel yield due to improved catalyst performance in the current year.

    Nitrogen Fertilizer Segment

    Fourth Quarter 2024 Compared to Fourth Quarter 2023

    The Nitrogen Fertilizer Segment reported net income of $18 million and EBITDA of $50 million on net sales of $140 million for the fourth quarter of 2024, compared to net income of $10 million and EBITDA of $38 million on net sales of $142 million for the fourth quarter of 2023.

    CVR Partners’ fertilizer facilities produced a combined 210,000 tons of ammonia during the fourth quarter of 2024, of which 80,000 net tons were available for sale, while the rest was upgraded to other fertilizer products, including 310,000 tons of urea ammonia nitrate (“UAN”). During the fourth quarter of 2023, the fertilizer facilities produced 205,000 tons of ammonia, of which 75,000 net tons were available for sale, while the remainder was upgraded to other fertilizer products, including 306,000 tons of UAN.

    For the fourth quarter of 2024, average realized gate prices for UAN declined by 5 percent to $229 per ton and ammonia improved by 3 percent to $475 per ton when compared to the fourth quarter of 2023. Average realized gate prices for UAN and ammonia were $241 per ton and $461 per ton, respectively, for the fourth quarter of 2023.

    Full-Year 2024 Compared to Full-Year 2023

    The Nitrogen Fertilizer Segment reported net income of $61 million and EBITDA of $179 million on net sales of $525 million for full-year 2024, compared to net income of $172 million and EBITDA of $281 million on net sales of $681 million for full-year 2023.

    For full-year 2024, our fertilizer facilities produced a combined 836,000 tons of ammonia, of which 270,000 net tons were available for sale, while the rest was upgraded to other fertilizer products, including 1,273,000 tons of UAN. For full-year 2023, the fertilizer facilities produced 864,000 tons of ammonia, of which 270,000 net tons were available for sale, while the remainder was upgraded to other fertilizer products, including 1,369,000 tons of UAN.

    For full-year 2024, average realized gate prices for UAN declined by 20 percent to $248 per ton and ammonia declined by 16 percent to $479 per ton when compared to the full-year 2023. Average realized gate prices for UAN and ammonia were $309 per ton and $573 per ton, respectively, for full-year 2023.

    Corporate and Other

    The Company reported income tax benefit of $26 million, or (137.2) percent of income before income taxes, for the year ended December 31, 2024, compared to an income tax expense of $207 million, or 19.1 percent of income before income taxes, for the year ended December 31, 2023. The decrease in income tax expense was due primarily to a decrease in overall pretax earnings for the year ended December 31, 2024, compared to the year ended December 31, 2023. In addition, the change in the effective tax rate was due primarily to changes in pretax earnings attributable to noncontrolling interests and the impact of federal and state tax credits and incentives generated in relation to overall pretax earnings for the year ended December 31, 2024, compared to the year ended December 31, 2023.

    Cash, Debt and Dividend

    During the fourth quarter of 2024, we completed two liquidity enhancing transactions generating net proceeds of $318 million from the senior secured term loan facility (the “Term Loan”) issuance and approximately $90 million of gross proceeds from the sale of our subsidiary’s 50% interest in the Midway Pipeline.

    Consolidated cash and cash equivalents was $987 million at December 31, 2024. Consolidated total debt and finance lease obligations was $1.9 billion at December 31, 2024, including $569 million held by the Nitrogen Fertilizer Segment.

    CVR Partners announced that the Board of Directors of its general partner declared a fourth quarter 2024 cash distribution of $1.75 per common unit, which will be paid on March 10, 2025, to common unitholders of record as of March 3, 2025.

    Fourth Quarter 2024 Earnings Conference Call

    CVR Energy previously announced that it will host its fourth quarter and full-year 2024 Earnings Conference Call on Wednesday, February 19, at 1 p.m. Eastern. This Earnings Conference Call may also include discussion of Company developments, forward-looking information and other material information about business and financial matters.

    The fourth quarter and full-year 2024 Earnings Conference Call will be webcast live and can be accessed on the Investor Relations section of CVR Energy’s website at www.CVREnergy.com. For investors or analysts who want to participate during the call, the dial-in number is (877) 407-8291. The webcast will be archived and available for 14 days at https://edge.media-server.com/mmc/p/4a2maqba. A repeat of the call can be accessed for 14 days by dialing (877) 660-6853, conference ID 13751234.

    Forward-Looking Statements
    This news release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements concerning current estimates, expectations and projections about future results, performance, prospects, opportunities, plans, actions and events and other statements, concerns, or matters that are not historical facts are “forward-looking statements,” as that term is defined under the federal securities laws. These forward-looking statements include, but are not limited to, statements regarding future: continued safe and reliable operations; drivers of our results; EBITDA and Adjusted EBITDA; asset utilization, capture, production volume, throughput product yield and crude oil gathering rates; cash flow generation; operating income and net sales; throughput; refining margin; crack spreads, including the improvement thereof; capacity rationalization; impact of costs to comply with the RFS and revaluation of our RFS liability; crude oil and refined product pricing impacts on inventory valuation; derivative gains and losses and the drivers thereof; crack spreads, including the drivers thereof; demand trends; RIN generation levels; ethanol and biodiesel blending activities; inventory levels; benefits of our corporate transformation to segregate our renewables business; access to capital and new partnerships; RIN pricing, including its impact on performance and the Company’s ability to offset the impact thereof; carbon capture and decarbonization initiatives; ammonia and UAN pricing; global fertilizer industry conditions; grain prices; crop inventory levels; crop and planting levels; demand for refined products; economic downturns and demand destruction; production levels and utilization at our nitrogen fertilizer facilities; nitrogen fertilizer sales volumes; ability to and levels to which we upgrade ammonia to other fertilizer products, including UAN; income tax expense, including the drivers thereof; changes to pretax earnings and our effective tax rate; the availability of tax credits and incentives; production rates and operations capabilities of our renewable diesel unit, including the ability to return to hydrocarbon service; renewable feedstock throughput; use of proceeds under our debt instruments; debt levels; cash and cash equivalent levels; dividends and distributions, including the timing, payment and amount (if any) thereof; direct operating expenses, capital expenditures, depreciation and amortization and turnaround expense; cash reserves; timing of turnarounds; impacts of any pandemic; labor supply shortages, difficulties, disputes or strikes, including the impact thereof; and other matters. You can generally identify forward-looking statements by our use of forward-looking terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “explore,” “evaluate,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “seek,” “should,” or “will,” or the negative thereof or other variations thereon or comparable terminology. These forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. Investors are cautioned that various factors may affect these forward-looking statements, including (among others) the health and economic effects of any pandemic, demand for fossil fuels and price volatility of crude oil, other feedstocks and refined products; the ability of Company to pay cash dividends and of CVR Partners to make cash distributions; potential operating hazards; costs of compliance with existing or new laws and regulations and potential liabilities arising therefrom; impacts of the planting season on CVR Partners; our controlling shareholder’s intention regarding ownership of our common stock or CVR Partners’ common units; general economic and business conditions; political disturbances, geopolitical instability and tensions; existing and future laws, rulings, policies and regulations, including the reinterpretation or amplification thereof by regulators, and including but not limited to those relating to the environment, climate change, and/or the production, transportation, or storage of hazardous chemicals, materials, or substances, like ammonia; political uncertainty and impacts to the oil and gas industry and the United States economy generally as a result of actions taken by a new administration, including the imposition of tariffs or changes in climate or other energy laws, rules, regulations, or policies; impacts of plant outages; potential operating hazards from accidents, fires, severe weather, tornadoes, floods, wildfires, or other natural disasters; and other risks. For additional discussion of risk factors which may affect our results, please see the risk factors and other disclosures included in our most recent Annual Report on Form 10-K, any subsequently filed Quarterly Reports on Form 10-Q and our other Securities and Exchange Commission (“SEC”) filings. These and other risks may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this news release are made only as of the date hereof. CVR Energy disclaims any intention or obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by law.

    About CVR Energy, Inc.
    Headquartered in Sugar Land, Texas, CVR Energy is a diversified holding company primarily engaged in the renewable fuels and petroleum refining and marketing businesses, as well as in the nitrogen fertilizer manufacturing business through its interest in CVR Partners, LP. CVR Energy subsidiaries serve as the general partner and own 37 percent of the common units of CVR Partners.

    Investors and others should note that CVR Energy may announce material information using SEC filings, press releases, public conference calls, webcasts and the Investor Relations page of its website. CVR Energy may use these channels to distribute material information about the Company and to communicate important information about the Company, corporate initiatives and other matters. Information that CVR Energy posts on its website could be deemed material; therefore, CVR Energy encourages investors, the media, its customers, business partners and others interested in the Company to review the information posted on its website.

    Contact Information:

    Investor Relations
    Richard Roberts
    (281) 207-3205
    InvestorRelations@CVREnergy.com

    Media Relations
    Brandee Stephens
    (281) 207-3516
    MediaRelations@CVREnergy.com

    Non-GAAP Measures

    Our management uses certain non-GAAP performance measures, and reconciliations to those measures, to evaluate current and past performance and prospects for the future to supplement our financial information presented in accordance with accounting principles generally accepted in the United States (“GAAP”). These non-GAAP financial measures are important factors in assessing our operating results and profitability and include the performance and liquidity measures defined below.

    As a result of continuing volatile market conditions and the impacts certain non-cash items may have on the evaluation of our operations and results, the Company began disclosing the Adjusted Refining Margin non-GAAP measure, as defined below, in the second quarter of 2024. We believe the presentation of this non-GAAP measure is meaningful to compare our operating results between periods and better aligns with our peer companies. All prior periods presented have been conformed to the definition below.

    The following are non-GAAP measures we present for the three and twelve months ended December 31, 2024 and 2023:

    EBITDA – Consolidated net income (loss) before (i) interest expense, net, (ii) income tax expense (benefit) and (iii) depreciation and amortization expense.

    Petroleum EBITDA, Renewables EBITDA, and Nitrogen Fertilizer EBITDA – Segment net income (loss) before segment (i) interest expense, net, (ii) income tax expense (benefit), and (iii) depreciation and amortization.

    Refining Margin – The difference between our Petroleum Segment net sales and cost of materials and other.

    Adjusted Refining Margin – Refining Margin adjusted for certain significant noncash items and items that management believes are not attributable to or indicative of our underlying operational results of the period or that may obscure results and trends we deem useful.

    Refining Margin and Adjusted Refining Margin, per Throughput Barrel – Refining Margin and Adjusted Refining Margin divided by the total throughput barrels during the period, which is calculated as total throughput barrels per day times the number of days in the period.

    Direct Operating Expenses per Throughput Barrel – Direct operating expenses for our Petroleum Segment divided by total throughput barrels for the period, which is calculated as total throughput barrels per day times the number of days in the period.

    Renewables Margin – The difference between our Renewables Segment net sales and cost of materials and other.

    Adjusted Renewables Margin – Renewables Margin adjusted for certain significant noncash items and items that management believes are not attributable to or indicative of our underlying operational results of the period or that may obscure results and trends we deem useful.

    Renewables Margin and Adjusted Renewables Margin, per Vegetable Oil Throughput Gallon – Renewables Margin and Adjusted Renewables Margin divided by the total vegetable oil throughput gallons for the period, which is calculated as total vegetable oil throughput gallons per day times the number of days in the period.

    Direct Operating Expenses per Vegetable Oil Throughput Gallon – Direct operating expenses for our Renewables Segment divided by total vegetable oil throughput gallons for the period, which is calculated as total vegetable oil throughput gallons per day times the number of days in the period.

    Adjusted EBITDA, Petroleum Adjusted EBITDA, Renewables Adjusted EBITDA, and Nitrogen Fertilizer Adjusted EBITDA – EBITDA, Petroleum EBITDA, Renewables EBITDA, and Nitrogen Fertilizer EBITDA adjusted for certain significant non-cash items and items that management believes are not attributable to or indicative of our underlying operational results of the period or that may obscure results and trends we deem useful.

    Adjusted Earnings (Loss) per Share – Earnings (loss) per share adjusted for certain significant non-cash items and items that management believes are not attributable to or indicative of our on-going operations or that may obscure our underlying results and trends.

    Free Cash Flow – Net cash provided by (used in) operating activities less capital expenditures and capitalized turnaround expenditures.

    We present these measures because we believe they may help investors, analysts, lenders and ratings agencies analyze our results of operations and liquidity in conjunction with our U.S. GAAP results, including but not limited to our operating performance as compared to other publicly traded companies in the refining and fertilizer industries, without regard to historical cost basis or financing methods and our ability to incur and service debt and fund capital expenditures. Non-GAAP measures have important limitations as analytical tools, because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures. See “Non-GAAP Reconciliations” included herein for reconciliation of these amounts. Due to rounding, numbers presented within this section may not add or equal to numbers or totals presented elsewhere within this document.

    Factors Affecting Comparability of Our Financial Results

    Petroleum Segment

    Major Scheduled Turnaround Activities – Our results of operations for the periods presented may not be comparable with prior periods or to our results of operations in the future due to capitalized expenditures as part of planned turnarounds. Total capitalized expenditures were $58 million and $60 million during the years ended December 31, 2024 and 2023, respectively. The next planned turnaround commenced in January 2025 at the Coffeyville Refinery.

    Midway JV Disposition – On December 23, 2024, a subsidiary of the Company sold the 50% limited liability company interests it owned in the Midway Pipeline, LLC to Plains Pipeline, L.P. in exchange for cash consideration of approximately $90 million. The sale resulted in a gain of $24 million within Other income (expense), net in the Company’s Consolidated Statements of Operations.

    CVR Energy, Inc.
    (unaudited)

    Consolidated Statement of Operations Data

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions, except per share data)  2024     2023     2024     2023 
    Net sales $ 1,947     $ 2,202     $ 7,610     $ 9,247  
    Operating costs and expenses:              
    Cost of materials and other   1,653       1,802       6,448       7,013  
    Direct operating expenses (exclusive of depreciation and amortization)   165       166       667       670  
    Depreciation and amortization   72       75       290       291  
    Cost of sales   1,890       2,043       7,405       7,974  
    Selling, general and administrative expenses (exclusive of depreciation and amortization)   35       34       139       141  
    Depreciation and amortization   2       1       8       7  
    (Gain) loss on asset disposal   (1 )     —       —       2  
    Operating income   21       124       58       1,123  
    Other income (expense):              
    Interest expense, net   (20 )     (9 )     (77 )     (52 )
    Other income, net   27       4       38       14  
    Income before income tax expense   28       119       19       1,085  
    Income tax expense (benefit)   (12 )     22       (26 )     207  
    Net income   40       97       45       878  
    Less: Net income attributable to noncontrolling interest   12       6       38       109  
    Net income attributable to CVR Energy stockholders $ 28     $ 91     $ 7     $ 769  
                   
    Basic and diluted earnings per share $ 0.28     $ 0.91     $ 0.06     $ 7.65  
    Dividends declared per share $ —     $ 2.00     $ 1.50     $ 4.50  
                   
    Adjusted (loss) earnings per share $ (0.13 )   $ 0.65     $ (0.51 )   $ 5.64  
    EBITDA* $ 122     $ 204     $ 394     $ 1,435  
    Adjusted EBITDA* $ 67     $ 170     $ 317     $ 1,164  
                   
    Weighted-average common shares outstanding – basic and diluted   100.5       100.5       100.5       100.5  

    ____________________

    * See “Non-GAAP Reconciliations” section below.

    Selected Consolidated Balance Sheet Data

    (in millions) December 31, 2024   December 31, 2023
    Cash and cash equivalents $ 987   $ 581
    Working capital   726     497
    Total assets   4,263     4,707
    Total debt and finance lease obligations, including current portion   1,919     2,185
    Total liabilities   3,375     3,669
    Total CVR stockholders’ equity   703     847

    Selected Consolidated Cash Flow Data

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions)  2024    2023     2024     2023 
    Net cash flows provided by (used in):              
    Operating activities $ 98   $ (36 )   $ 404     $ 948  
    Investing activities   43     (58 )     (121 )     (239 )
    Financing activities   312     384       (482 )     (40 )
    Net increase (decrease) in cash, cash equivalents and restricted cash $ 453   $ 290     $ (199 )   $ 669  
                   
    Free cash flow * $ 40   $ (94 )   $ 181     $ 708  

    _____________________

    * See “Non-GAAP Reconciliations” section below.

    Selected Segment Data

      Three Months Ended December 31, 2024   Three Months Ended December 31, 2023
    (in millions) Petroleum   Renewables   Nitrogen Fertilizer   Consolidated   Petroleum   Renewables   Nitrogen Fertilizer   Consolidated
    Net sales $ 1,755   $ 93     $ 140   $ 1,947   $ 1,997   $ 110     $ 142   $ 2,202
    Operating income (loss)   4     (3 )     26     21     144     (31 )     17     124
    Net income (loss)   35     (3 )     18     40     158     (30 )     10     97
    EBITDA *   72     3       50     122     196     (26 )     38     204
                                   
    Capital Expenditures: (1)                              
    Maintenance $ 24   $ 1     $ 15   $ 40   $ 24   $ 1     $ 11   $ 36
    Growth   7     —       3     11     5     8       —     13
    Total capital expenditures $ 31   $ 1     $ 18   $ 51   $ 29   $ 9     $ 11   $ 49
      Year Ended December 31, 2024   Year Ended December 31, 2023
    (in millions) Petroleum   Renewables   Nitrogen
    Fertilizer
      Consolidated   Petroleum   Renewables   Nitrogen
    Fertilizer
      Consolidated
    Net sales $ 6,920   $ 289     $ 525   $ 7,610   $ 8,287   $ 559     $ 681   $ 9,247
    Operating income (loss)   12     (22 )     90     58     982     (37 )     201     1,123
    Net income (loss)   70     (21 )     61     45     1,071     (36 )     172     878
    EBITDA *   223     3       179     394     1,185     (17 )     281     1,435
                                   
    Capital Expenditures: (1)                              
    Maintenance $ 90   $ 3     $ 30   $ 127   $ 94   $ 2     $ 28   $ 128
    Growth   38     8       7     54     14     54       1     69
    Total capital expenditures $ 128   $ 11     $ 37   $ 181   $ 108   $ 56     $ 29   $ 197

    ______________________

    * See “Non-GAAP Reconciliations” section below.

    (1)   Capital expenditures are shown exclusive of capitalized turnaround expenditures and business combinations.

      

      December 31, 2024   December 31, 2023
    (in millions) Petroleum   Renewables   Nitrogen
    Fertilizer
      Consolidated   Petroleum   Renewables   Nitrogen
    Fertilizer
      Consolidated
    Cash and cash equivalents (1) $ 735   $ 13   $ 91   $ 987   $ 375   $ 16   $ 45   $ 581
    Total assets   3,288     420     1,019     4,263     2,978     344     975     4,707
    Total debt and finance lease obligations, including current portion (2)   354     —     569     1,919     44     5     547     2,185

    ___________________________

    (1)   Corporate cash and cash equivalents consisted of $148 million and $145 million at December 31, 2024 and December 31, 2023, respectively.
    (2)   Corporate total debt and finance lease obligations, including current portion consisted of $996 million and $1,594 million at December 31, 2024 and December 31, 2023, respectively.

    Petroleum Segment

    Key Operating Metrics per Total Throughput Barrel

      Three Months Ended
    December 31,
      Year Ended
    December 31,
       2024    2023    2024    2023
    Refining margin * $ 8.37   $ 15.01   $ 9.53   $ 21.82
    Adjusted refining margin *   6.45     12.91     8.67     18.11
    Direct operating expenses *   5.13     4.69     5.86     5.34

    ___________________

    * See “Non-GAAP Reconciliations” section below.

    Throughput Data by Refinery

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in bpd) 2024   2023   2024   2023
    Coffeyville              
    Gathered crude 69,560   61,733   71,382   62,263
    Other domestic 47,732   57,161   39,360   49,930
    Canadian 3,969   6,109   7,304   3,265
    Condensate —   7,115   3,177   7,566
    Other crude oil 5,709   —   2,546   —
    Other feedstocks and blendstocks 14,997   16,321   12,511   13,490
    Wynnewood              
    Gathered crude 55,507   49,061   46,185   50,900
    Other domestic —   2,974   980   2,112
    Condensate 10,747   17,192   9,165   15,228
    Other feedstocks and blendstocks 5,482   4,888   3,668   3,465
    Total throughput 213,703   222,554   196,278   208,219

    Production Data by Refinery

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in bpd) 2024   2023   2024   2023
    Coffeyville              
    Gasoline         72,868             76,921             69,771             69,847  
    Distillate         61,016             62,570             56,690             57,888  
    Other liquid products         3,775             4,168             5,125             4,388  
    Solids         4,349             4,798             4,762             4,123  
    Wynnewood              
    Gasoline         40,139             42,363             33,106             38,843  
    Distillate         24,473             25,432             20,917             24,978  
    Other liquid products         4,405             5,480             4,551             6,882  
    Solids         12             9             9             10  
    Total production         211,037             221,741             194,931             206,959  
                   
    Light product yield (as % of total crude throughput) (1) 102.7 %   103.0 %   100.2 %   100.2 %
    Liquid volume yield (as % of total throughput) (2) 96.7 %   97.5 %   96.9 %   97.4 %
    Distillate yield (as % of total crude throughput) (3) 44.2 %   43.7 %   43.1 %   43.3 %

    ______________________

    (1)   Total Gasoline and Distillate divided by total Gathered crude, Other domestic, Canadian, and Condensate throughput (collectively, “Total Crude Throughput”).
    (2)   Total Gasoline, Distillate, and Other liquid products divided by total throughput.
    (3)   Total Distillate divided by Total Crude Throughput.

    Key Market Indicators

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (dollars per barrel)  2024     2023     2024     2023 
    West Texas Intermediate (WTI) NYMEX $ 70.32     $ 78.53     $ 75.77     $ 77.57  
    Crude Oil Differentials to WTI:              
    Brent   3.69       4.32       4.09       4.60  
    WCS (heavy sour)   (12.25 )     (22.91 )     (13.86 )     (17.97 )
    Condensate   (0.24 )     (0.30 )     (0.48 )     (0.21 )
    Midland Cushing   0.87       1.09       1.10       1.26  
    NYMEX Crack Spreads:              
    Gasoline   13.84       13.69       20.91       27.88  
    Heating Oil   23.40       41.34       26.67       40.60  
    NYMEX 2-1-1 Crack Spread   18.62       27.52       23.79       34.24  
    PADD II Group 3 Product Basis:              
    Gasoline   (4.03 )     (4.75 )     (6.52 )     (2.92 )
    Ultra Low Sulfur Diesel (ULSD)           (4.57 )             (2.96 )             (4.96 )             (1.02 )
    PADD II Group 3 Product Crack Spread:              
    Gasoline   9.81       8.94       14.40       24.96  
    ULSD   18.83       38.38       21.71       39.57  
    PADD II Group 3 2-1-1   14.32       23.66       18.05       32.27  

    Renewables Segment

    Key Operating Metrics per Vegetable Oil Throughput Gallon

      Three Months Ended
    December 31,
      Year Ended
    December 31,
       2024    2023     2024    2023
    Renewables margin * $ 0.79   $ (0.90 )   $ 0.80   $ 0.27
    Adjusted renewables margin *   1.16     (0.43 )     0.93     0.41
    Direct operating expenses *   0.48     0.37       0.57     0.35

    __________________________

    * See “Non-GAAP Reconciliations” section below.

    Renewables Throughput Data

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in gallons per day) 2024   2023   2024   2023
    Corn Oil 81,497   90,932   52,807   53,661
    Soybean Oil 105,351   109,242   98,439   172,297
    Other feedstocks and blendstocks 91,709   46,210   58,730   51,039
    Total throughput 278,557   246,384   209,976   276,997

    Renewables Production Data

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in gallons per day) 2024    2023    2024    2023 
    Renewable diesel 163,110     176,200     134,399     200,015  
    Renewable naphtha 19,731     32,886     17,101     34,099  
    Renewable light ends 88,938     94,952     62,424     92,802  
    Other 67,293     42,106     41,064     45,552  
    Total production 339,072     346,144     254,988     372,468  
                   
    Renewable diesel yield (as % of corn and soybean oil throughput) 87.8 %   88.0 %   89.2 %   88.5 %

    Key Market Indicators

      Three Months Ended December 31,   Year Ended
    December 31,
       2024    2023    2024    2023
    Chicago Board of Trade (CBOT) soybean oil (dollars per pound) $ 0.43   $ 0.52   $ 0.44   $ 0.58
    Midwest crude corn oil (dollars per pound)   0.46     0.62     0.50     0.61
    CARB ULSD (dollars per gallon)   2.28     2.90     2.47     2.89
    NYMEX ULSD (dollars per gallon)   2.23     2.85     2.44     2.81
    California LCFS (dollars per metric ton)   72.05     68.71     60.07     72.52
    Biodiesel RINs (dollars per RIN)   0.66     0.84     0.59     1.35

    Nitrogen Fertilizer Segment

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (percent of capacity utilization) 2024   2023   2024   2023
    Ammonia utilization rate (1) 96 %   94 %   96 %   100 %

    _____________________

    (1)   Reflects our ammonia utilization rates on a consolidated basis. Utilization is an important measure used by management to assess operational output at each of the Nitrogen Fertilizer Segment’s facilities. Utilization is calculated as actual tons produced divided by capacity. We present our utilization for the three and twelve months ended December 31, 2024 and 2023, respectively, and take into account the impact of our current turnaround cycles on any specific period. Additionally, we present utilization solely on ammonia production rather than each nitrogen product as it provides a comparative baseline against industry peers and eliminates the disparity of plant configurations for upgrade of ammonia into other nitrogen products. With our efforts being primarily focused on ammonia upgrade capabilities, this measure provides a meaningful view of how well we operate.

    Sales and Production Data

      Three Months Ended
    December 31,
      Year Ended
    December 31,
       2024    2023    2024    2023
    Consolidated sales (thousands of tons):              
    Ammonia   97     98     271     281
    UAN   310     320     1,260     1,395
                   
    Consolidated product pricing at gate (dollars per ton): (1)              
    Ammonia $ 475   $ 461   $ 479   $ 573
    UAN   229     241     248     309
                   
    Consolidated production volume (thousands of tons):              
    Ammonia (gross produced) (2)   210     205     836     864
    Ammonia (net available for sale) (2)   80     75     270     270
    UAN   310     306     1,273     1,369
                   
    Feedstock:              
    Petroleum coke used in production (thousands tons)   123     131     517     518
    Petroleum coke used in production (dollars per ton) $ 55.71   $ 77.09   $ 59.69   $ 78.14
    Natural gas used in production (thousands of MMBtus) (3)   2,224     2,033     8,667     8,462
    Natural gas used in production (dollars per MMBtu) (3) $ 3.00   $ 2.95   $ 2.56   $ 3.42
    Natural gas in cost of materials and other (thousands of MMBtus) (3)   2,352     2,317     7,755     8,671
    Natural gas in cost of materials and other (dollars per MMBtu) (3) $ 2.50   $ 2.83   $ 2.50   $ 3.84

    ______________________

    (1)   Product pricing at gate represents sales less freight revenue divided by product sales volume in tons and is shown in order to provide a pricing measure that is comparable across the fertilizer industry.
    (2)   Gross tons produced for ammonia represent total ammonia produced, including ammonia produced that was upgraded into other fertilizer products. Net tons available for sale represent ammonia available for sale that was not upgraded into other fertilizer products.
    (3)   The feedstock natural gas shown above does not include natural gas used for fuel. The cost of fuel natural gas is included in direct operating expense.

    Key Market Indicators

      Three Months Ended
    December 31,
      Year Ended
    December 31,
      2024    2023    2024    2023
    Ammonia — Southern plains (dollars per ton) $ 526   $ 648   $ 526   $ 564
    Ammonia — Corn belt (dollars per ton)   595     704     573     644
    UAN — Corn belt (dollars per ton)   274     301     277     311
                   
    Natural gas NYMEX (dollars per MMBtu) $ 2.98   $ 2.92   $ 2.41   $ 2.67

    Q1 2025 Outlook

    The table below summarizes our outlook for certain refining statistics and financial information for the first quarter of 2025. See “Forward-Looking Statements” above.

      Q1 2025
      Low   High
    Petroleum      
    Total throughput (bpd)   120,000       135,000  
    Direct operating expenses (in millions) (1) $ 95     $ 105  
    Turnaround (2)   150       165  
           
    Renewables      
    Total throughput (in millions of gallons)   13       16  
    Direct Operating expenses (in millions) (1) $ 8     $ 10  
           
    Nitrogen Fertilizer      
    Ammonia utilization rate   95 %     100 %
    Direct operating expenses (in millions) (1) $ 55     $ 65  
           
    Capital Expenditures (in millions) (2)      
    Petroleum $ 30     $ 40  
    Renewables   2       5  
    Nitrogen Fertilizer   12       16  
    Other   —       2  
    Total capital expenditures $ 44     $ 63  

    ____________________

    (1)   Direct operating expenses are shown exclusive of depreciation and amortization and, for the Nitrogen Fertilizer Segment, turnaround expenses and inventory valuation impacts.
    (2)   Turnaround and capital expenditures are disclosed on an accrual basis.

    Non-GAAP Reconciliations

    Reconciliation of Consolidated Net Income to EBITDA and Adjusted EBITDA

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions)  2024     2023     2024     2023 
    Net income $ 40     $ 97     $ 45     $ 878  
    Interest expense, net   20       9       77       52  
    Income tax (benefit) expense   (12 )     22       (26 )     207  
    Depreciation and amortization   74       76       298       298  
    EBITDA   122       204       394       1,435  
    Adjustments:              
    Revaluation of RFS liability, favorable   (57 )     (57 )     (89 )     (284 )
    Unrealized loss (gain) on derivatives   6       (67 )     22       (32 )
    Inventory valuation impacts, unfavorable   20       90       14       45  
    Gain on sale of equity method investment   (24 )     —       (24 )     —  
    Adjusted EBITDA $ 67     $ 170     $ 317     $ 1,164  

    Reconciliation of Basic and Diluted Earnings per Share to Adjusted Earnings per Share

      Three Months Ended
    December 31,
      Year Ended
    December 31,
       2024     2023     2024     2023 
    Basic and diluted earnings per share $ 0.28     $ 0.91     $ 0.06     $ 7.65  
    Adjustments: (1)              
    Revaluation of RFS liability, favorable   (0.43 )     (0.42 )     (0.67 )     (2.12 )
    Unrealized loss (gain) on derivatives   0.04       (0.50 )     0.16       (0.23 )
    Inventory valuation impacts, unfavorable   0.16       0.66       0.12       0.34  
    Gain on sale of equity method investment   (0.18 )     —       (0.18 )     —  
    Adjusted (loss) earnings per share $ (0.13 )   $ 0.65     $ (0.51 )   $ 5.64  

    ___________________

    (1)   Amounts are shown after-tax, using the Company’s marginal tax rate, and are presented on a per share basis using the weighted average shares outstanding for each period.

    Reconciliation of Net Cash Provided By (Used In) Operating Activities to Free Cash Flow

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions)  2024     2023     2024     2023 
    Net cash provided by (used in) operating activities $ 98     $ (36 )   $ 404     $ 948  
    Less:              
    Capital expenditures   (55 )     (55 )     (179 )     (205 )
    Capitalized turnaround expenditures   (7 )     (4 )     (53 )     (57 )
    Return on equity method investment   4       1       9       22  
    Free cash flow $ 40     $ (94 )   $ 181     $ 708  

    Reconciliation of Petroleum Segment Net Income to EBITDA and Adjusted EBITDA

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions)  2024     2023     2024     2023 
    Petroleum net income $ 35     $ 158     $ 70     $ 1,071  
    Interest income, net   (4 )     (10 )     (21 )     (75 )
    Depreciation and amortization   41       48       174       189  
    Petroleum EBITDA   72       196       223       1,185  
    Adjustments:              
    Revaluation of RFS liability, favorable   (57 )     (57 )     (89 )     (284 )
    Unrealized loss (gain) on derivatives, net   6       (67 )     22       (30 )
    Inventory valuation impact, unfavorable (1)   12       80       6       32  
    Gain on sale of equity method investment   (24 )     —       (24 )     —  
    Petroleum Adjusted EBITDA   9       152       138       903  

    Reconciliation of Petroleum Segment Gross Profit to Refining Margin and Adjusted Refining Margin

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions, except throughput data)   2024     2023     2024     2023 
    Net sales $ 1,755     $ 1,997     $ 6,920     $ 8,287  
    Less:              
    Cost of materials and other   (1,590 )     (1,690 )     (6,236 )     (6,629 )
    Direct operating expenses (exclusive of depreciation and amortization)   (101 )     (96 )     (421 )     (406 )
    Depreciation and amortization   (41 )     (47 )     (174 )     (185 )
    Gross profit   23       164       89       1,067  
    Add:              
    Direct operating expenses (exclusive of depreciation and amortization)   101       96       421       406  
    Depreciation and amortization   41       47       174       185  
    Refining margin   165       307       684       1,658  
    Adjustments:              
    Revaluation of RFS liability, favorable   (57 )     (57 )     (89 )     (284 )
    Unrealized loss (gain) on derivatives, net   6       (67 )     22       (30 )
    Inventory valuation impact, unfavorable (1)   12       80       6       32  
    Adjusted refining margin $ 126     $ 263     $ 623     $ 1,376  
                   
    Total throughput barrels per day   213,703       222,554       196,278       208,219  
    Days in the period   92       92       366       365  
    Total throughput barrels   19,660,650       20,474,980       71,837,644       75,999,905  
                   
    Refining margin per total throughput barrel $ 8.37     $ 15.01     $ 9.53     $ 21.82  
    Adjusted refining margin per total throughput barrel   6.45       12.91       8.67       18.11  
    Direct operating expenses per total throughput barrel   5.13       4.69       5.86       5.34  

    _____________________

    (1)   The Petroleum Segment’s basis for determining inventory value under GAAP is First-In, First-Out (“FIFO”). Changes in crude oil prices can cause fluctuations in the inventory valuation of crude oil, work in process and finished goods, thereby resulting in a favorable inventory valuation impact when crude oil prices increase and an unfavorable inventory valuation impact when crude oil prices decrease. The inventory valuation impact is calculated based upon inventory values at the beginning of the accounting period and at the end of the accounting period.

    Reconciliation of Renewables Segment Net Loss to EBITDA and Adjusted EBITDA

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions)  2024     2023     2024     2023 
    Renewables net loss $ (3 )   $ (30 )   $ (21 )   $ (36 )
    Interest expense, net   —       (1 )     (1 )     (1 )
    Depreciation and amortization   6       5       25       20  
    Renewables EBITDA   3       (26 )     3       (17 )
    Adjustments:              
    Unrealized (gain) loss on derivatives, net   —       —       —       (2 )
    Inventory valuation, (favorable) unfavorable (1)   6       9       7       14  
    Renewables Adjusted EBITDA $ 9     $ (17 )   $ 10     $ (5 )

    Reconciliation of Renewables Segment Gross Loss to Renewables Margin and Adjusted Renewables Margin

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions, except throughput data)   2024     2023     2024     2023 
    Net sales $ 93     $ 110     $ 289     $ 559  
    Less:              
    Cost of materials and other   (79 )     (127 )     (245 )     (537 )
    Direct operating expenses (exclusive of depreciation and amortization)   (8 )     (7 )     (31 )     (28 )
    Depreciation and amortization   (6 )     (5 )     (25 )     (20 )
    Gross loss   —       (29 )     (12 )     (26 )
    Add:              
    Direct operating expenses (exclusive of depreciation and amortization)   8       7       31       28  
    Depreciation and amortization   6       5       25       20  
    Renewables margin   14       (17 )     44       22  
    Unrealized (gain) loss on derivatives, net   —       —       —       (2 )
    Inventory valuation, (favorable) unfavorable (1)   6       9       7       14  
    Adjusted renewables margin $ 20     $ (8 )   $ 51     $ 34  
                   
    Total vegetable oil throughput gallons per day   186,970       200,174       151,278       225,957  
    Days in the period   92       92       366       365  
    Total vegetable oil throughput gallons   17,201,274       18,416,045       55,367,620       82,474,473  
                   
    Renewables margin per vegetable oil throughput gallon $ 0.79     $ (0.90 )   $ 0.80     $ 0.27  
    Adjusted renewables margin per vegetable oil throughput gallon   1.16       (0.43 )     0.93       0.41  
    Direct operating expenses per vegetable oil throughput gallon   0.48       0.37       0.57       0.35  

    ____________________

    (1)   The Renewables Segment’s basis for determining inventory value under GAAP is FIFO. Changes in renewable diesel prices can cause fluctuations in the inventory valuation of renewable diesel, work in process and finished goods, thereby resulting in a favorable inventory valuation impact when renewable diesel prices increase and an unfavorable inventory valuation impact when renewable diesel prices decrease. The inventory valuation impact is calculated based upon inventory values at the beginning of the accounting period and at the end of the accounting period.

    Reconciliation of Nitrogen Fertilizer Segment Net Income to EBITDA and Adjusted EBITDA

      Three Months Ended
    December 31,
      Year Ended
    December 31,
    (in millions)  2024    2023    2024    2023
    Nitrogen Fertilizer net income $ 18   $ 10   $ 61   $ 172
    Add:              
    Interest expense, net   7     7     30     29
    Depreciation and amortization   25     21     88     80
    Nitrogen Fertilizer EBITDA and Adjusted EBITDA $ 50   $ 38   $ 179   $ 281

    The MIL Network –

    February 19, 2025
  • MIL-OSI: Occidental Announces Further Progress on Debt Reduction

    Source: GlobeNewswire (MIL-OSI)

    • Achieved near-term debt repayment target of $4.5 billion in the fourth quarter of 2024
    • Announced proceeds from $1.2 billion of divestitures signed in the first quarter of 2025 will go toward current year debt maturities

    HOUSTON, Feb. 18, 2025 (GLOBE NEWSWIRE) — Occidental (NYSE: OXY) today announced it achieved its near-term debt repayment target of $4.5 billion in the fourth quarter of 2024 and signed two agreements in the first quarter of 2025 to divest upstream assets to undisclosed buyers for a combined total of $1.2 billion.

    The divestiture transactions, which are expected to close in the first quarter of 2025, include Rockies non-operated assets and Permian Basin assets not included in Occidental’s near-term development plan. The resulting proceeds will be applied to the company’s remaining 2025 debt maturities.

    “We were pleased to reach the near-term deleveraging milestone in the fourth quarter of 2024, within five months of closing the CrownRock acquisition, and seven months ahead of our goal,” said President and CEO Vicki Hollub. “The transactions announced today continue to high grade our portfolio and accelerate the progress toward achieving both our medium-term balance sheet deleveraging target and shareholder return pathway.”

    Occidental will continue to advance deleveraging via free cash flow and divestitures.

    About Occidental
    Occidental is an international energy company with assets primarily in the United States, the Middle East and North Africa. We are one of the largest oil and gas producers in the U.S., including a leading producer in the Permian and DJ basins, and offshore Gulf of America. Our midstream and marketing segment provides flow assurance and maximizes the value of our oil and gas, and includes our Oxy Low Carbon Ventures subsidiary, which is advancing leading-edge technologies and business solutions that economically grow our business while reducing emissions. Our chemical subsidiary OxyChem manufactures the building blocks for life-enhancing products. We are dedicated to using our global leadership in carbon management to advance a lower-carbon world. Visit oxy.com for more information.

    Forward-Looking Statements

    This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements about Occidental’s expectations, beliefs, plans or forecasts. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to: any projections of earnings, revenue or other financial items or future financial position or sources of financing; any statements of the plans, strategies and objectives of management for future operations or business strategy; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Words such as “estimate,” “project,” “will,” “should,” “could,” “may,” “anticipate,” “plan,” “intend,” “expect,” “goal,” “target,” “advance,” or similar expressions that convey the prospective nature of events or outcomes are generally indicative of forward-looking statements. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release unless an earlier date is specified. Unless legally required, Occidental does not undertake any obligation to update, modify or withdraw any forward-looking statements as a result of new information, future events or otherwise.

    Forward-looking statements involve estimates, expectations, projections, goals, forecasts, assumptions, risks and uncertainties. Actual outcomes or results may differ from anticipated results, sometimes materially. Factors that could cause actual results to differ include, but are not limited to: general economic conditions, including slowdowns and recessions, domestically or internationally; Occidental’s indebtedness and other payment obligations, including the need to generate sufficient cash flows to fund operations; Occidental’s ability to successfully monetize select assets and repay or refinance debt and the impact of changes in Occidental’s credit ratings or future increases in interest rates; assumptions about energy markets; global and local commodity and commodity-futures pricing fluctuations and volatility; supply and demand considerations for, and the prices of, Occidental’s products and services; actions by Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC oil producing countries; results from operations and competitive conditions; future impairments of Occidental’s proved and unproved oil and gas properties or equity investments, or write-downs of productive assets, causing charges to earnings; unexpected changes in costs; inflation, its impact on markets and economic activity and related monetary policy actions by governments in response to inflation; availability of capital resources, levels of capital expenditures and contractual obligations; the regulatory approval environment, including Occidental’s ability to timely obtain or maintain permits or other government approvals, including those necessary for drilling and/or development projects; Occidental’s ability to successfully complete, or any material delay of, field developments, expansion projects, capital expenditures, efficiency projects, acquisitions or divestitures; risks associated with acquisitions, mergers and joint ventures, such as difficulties integrating businesses, uncertainty associated with financial projections or projected synergies, restructuring, increased costs and adverse tax consequences; uncertainties and liabilities associated with acquired and divested properties and businesses; uncertainties about the estimated quantities of oil, NGL and natural gas reserves; lower-than-expected production from development projects or acquisitions; Occidental’s ability to realize the anticipated benefits from prior or future streamlining actions to reduce fixed costs, simplify or improve processes and improve Occidental’s competitiveness; exploration, drilling and other operational risks; disruptions to, capacity constraints in, or other limitations on the pipeline systems that deliver Occidental’s oil and natural gas and other processing and transportation considerations; volatility in the securities, capital or credit markets, including capital market disruptions and instability of financial institutions; government actions (including geopolitical, trade, tariff and regulatory uncertainties), war (including the Russia-Ukraine war and conflicts in the Middle East) and political conditions and events; health, safety and environmental (HSE) risks, costs and liability under existing or future federal, regional, state, provincial, tribal, local and international HSE laws, regulations and litigation (including related to climate change or remedial actions or assessments); legislative or regulatory changes, including changes relating to hydraulic fracturing or other oil and natural gas operations, retroactive royalty or production tax regimes and deep-water and onshore drilling and permitting regulations; Occidental’s ability to recognize intended benefits from its business strategies and initiatives, such as Occidental’s low-carbon ventures businesses or announced GHG emissions reduction targets or net-zero goals; potential liability resulting from pending or future litigation, government investigations and other proceedings; disruption or interruption of production or manufacturing or facility damage due to accidents, chemical releases, labor unrest, weather, power outages, natural disasters, cyber-attacks, terrorist acts or insurgent activity; the scope and duration of global or regional health pandemics or epidemics, and actions taken by government authorities and other third parties in connection therewith; the creditworthiness and performance of Occidental’s counterparties, including financial institutions, operating partners and other parties; failure of risk management; Occidental’s ability to retain and hire key personnel; supply, transportation and labor constraints; reorganization or restructuring of Occidental’s operations; changes in state, federal or international tax rates; and actions by third parties that are beyond Occidental’s control.

    Additional information concerning these and other factors that may cause Occidental’s results of operations and financial position to differ from expectations can be found in Occidental’s filings with the U.S. Securities and Exchange Commission, including Occidental’s Annual Report on Form 10-K for the year ended December 31, 2024, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

    Contacts

    The MIL Network –

    February 19, 2025
  • MIL-OSI Security: Violations of the False Claims Act as the Result of Fraudulent Payment Protection Program Loans Settled in United States District Court

    Source: Office of United States Attorneys

    LAFAYETTE, La. – Acting United States Attorney Alexander C. Van Hook announced that the United States has obtained consent or default judgments in five civil fraud lawsuits alleging the individuals obtained loans for fictitious companies or fictitious self-employment under the Paycheck Protection Program (“PPP”). The defendants named in the lawsuits are Antoinette Kennedy, Andre Lane, Dieudonne Nlend, Tracey Thompson and Rashinda Harris. These defendants obtained forgiveness of their loans in violation of the False Claims Act. This litigation resulted in judgments in favor of the United States in the total amount of $138,413.72.  

    The PPP was an emergency loan program established by Congress in March 2020 under the Coronavirus Aid, Relief and Economic Security (“CARES”) Act and administered by the Small Business Administration (“SBA”).  The PPP was created to provide forgivable loans to support small businesses struggling to pay employees and other business expenses during the COVID-19 pandemic. When applying for PPP loans, borrowers were required to certify that they were eligible for the requested loan and that the information provided in the loan application was true and accurate.  To receive forgiveness, borrowers were required to submit signed loan forgiveness applications and documents containing certain information and certifications. 

    The case involving defendant Kennedy began in May 2024 when agents began investigating a fraudulent PPP loan received by her. Investigators with the Army Criminal Investigation Unit learned that Kennedy had no business, business income, or business expenses as she falsely stated on her application for the PPP loan. Their investigation further revealed that Kennedy had learned about a scheme on Instagram and obtained loans on her own behalf and prepared the false paperwork. The government filed a complaint to recover damages and civil penalties under the False Claims Act for PPP funds which Kennedy received which she was not entitled to. A default judgment was obtained by the United States against Kennedy in the amount of $48,813.72.

    Thompson and Harris were small business owners and allowed someone to assist them with the creating of their false PPP loan applications. Their applications exaggerated the amount of business income that each of them actually had. Both defendants were responsible for submitting false loan applications and received PPP loans to which they would have not been entitled to receive. Similarly, Lane was self-employed and submitted a false self-employment income claim. Lane’s application exaggerated his self-employment income.  A settlement was reached with each of these three defendants, and consent judgments were obtained by the United States in the amounts of $23,516, $23,415, and $23,435, respectively.

    During the investigation of Dieudonne Nlend, agents interviewed him, and he admitted to falsifying self-employment income amounts. Nlend told agents that he used the proceeds from the PPP loan to assist a family member with a medical issue in another country. A consent judgment in the amount of $19,234 was obtained by the United States against Nlend.

    “The United States Attorney’s Office will use every tool at our disposal – to include civil litigation – to root out fraud, waste, and abuse of taxpayer money,” said Acting U.S. Attorney Alexander C. Van Hook. “We are proud to work with our law enforcement partners to hold these wrongdoers accountable.”

    The resolutions obtained were the result of a coordinated effort between the Civil Division of the U.S. Attorney’s Office, Small Business Administration’s Office of Inspector General, and for certain defendants, the Department of Army Criminal Investigation Division. The cases were handled by Assistant U.S. Attorney Melissa L. Theriot.

    # # #

    MIL Security OSI –

    February 19, 2025
  • MIL-OSI Security: U.S. Attorney’s Office Collects nearly $3.5 Million in Debts Owed to Federal Victims of Crime and the United States in Fiscal Year 2024

    Source: Office of United States Attorneys

    SIOUX FALLS – U.S. Attorney Alison Ramsdell announced today that the United States Attorney’s Office for the District of South Dakota collected $3,496,288.47 in criminal and civil actions in Fiscal Year 2024. Of this amount, $1,584,408.91 was collected in criminal actions and $1,911,879.56 was collected in civil actions. The District of South Dakota office worked with other U.S. Attorney’s Offices elsewhere in the country and components of the Department of Justice to collect an additional $775,964.79. Excluded from these totals are significant recoveries obtained at the end of Calendar Year 2024, such as the $12.7M settlement to resolve alleged False Claims Act violations relating to improper financial relationships between Dunes Surgical Hospital and two physician groups, and the $1.4M paid toward restitution in a pandemic fraud prosecution.

    “Ensuring the collection of federal debt restores justice to victims of crime and reinforces the integrity of our governmental institutions,” said U.S. Attorney Alison J. Ramsdell.

    In addition to filing 14 new garnishment actions, the Financial Litigation Unit of the U.S. Attorney’s Office closed 44 civil and criminal restitution cases where the federal debt or victims were paid in full. For example, in a civil case involving the Farm Service Agency (FSA), the Financial Litigation Unit recovered $52,561.75 from a borrower who sold calves in violation of his loan agreement with a local bank. In a criminal case arising from a wire fraud conviction, the same Financial Litigation Unit recovered $36,773.79 from an inheritance the defendant received while in custody, thus providing a substantial recovery to the victims of the defendant’s wire fraud. 

    United States Attorney’s Offices, along with the Department of Justice’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the United States and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the Department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.

    MIL Security OSI –

    February 19, 2025
  • MIL-OSI Asia-Pac: India – Qatar Joint Statement

    Source: Government of India

    Posted On: 18 FEB 2025 8:17PM by PIB Delhi

    At the invitation of Prime Minister of India His Excellency Shri Narendra Modi, His Highness the Amir of the State of Qatar, Sheikh Tamim bin Hamad Al-Thani paid a State Visit to India on 17-18 February 2025. HH the Amir was accompanied by a high-level delegation comprising Ministers, officials and business leaders. This was the second State Visit of HH the Amir to India.

    HH the Amir was received by Hon’ble President of India Smt Droupadi Murmu and Prime Minister Shri Narendra Modi at the Forecourt of Rashtrapati Bhawan on 18 February and was accorded a ceremonial welcome. Hon’ble President also hosted a banquet reception in honour of HH the Amir and accompanying delegation.

    Prime Minister Shri Narendra Modi held bilateral talks with HH the Amir at Hyderabad House on 18 February. Both leaders recalled the historic trade linkages, deep-rooted people-to-people ties and robust bilateral relations between both countries. They expressed the desire for further expanding and deepening of the multifaceted relationship between both countries. In this context, they expressed happiness on the signing of the ‘Agreement on the Establishment of Bilateral Strategic Partnership’ between the two sides.

    In light of the newly established Strategic Partnership, the two sides reaffirmed their commitment to further strengthen the bilateral relations through regular and structured cooperation in all areas, including political, trade, investment, security, energy, culture, education, technology, innovation, sustainability and people-to-people ties. In this regard, the two sides expressed happiness at the signing of the revised Double Taxation Avoidance Agreement and also agreed to expedite negotiations on the India-Qatar Bilateral Investment Treaty.

    The two sides noted with satisfaction that regular interactions at various levels have helped provide momentum to the multifaceted bilateral cooperation. They recalled the successful visit of HH the Amir to India in March 2015 and the visits of Prime Minister to Qatar in June 2016 and February 2024. The two sides agreed to continue the high-level exchanges through regular bilateral mechanisms at Ministerial and senior-official levels.

    The two sides noted that trade and commerce has been a strong pillar of bilateral economic cooperation between the two countries and emphasized on the potential for further growth and diversification in bilateral trade. The two sides welcomed the elevation of the existing Joint Working Group on Trade and Commerce into a Joint Commission on Trade and Commerce. The Joint Commission will be an institutional mechanism to review and monitor the entire spectrum of economic ties between the two countries and will be headed by the Ministers of Commerce and Industry on both sides.

    The two sides laid emphasis on strengthening collaborations between their business and industry bodies. In this context, they welcomed the holding of the first meeting of the Joint Business Council on 13 February 2025.

    The two sides agreed on the need to explore strategies for enhanced and diversified trade between the two countries and address on priority market access issues related to trade in goods and services. In this regard, the two sides agreed to explore the possibility of entering into a bilateral Comprehensive Economic Partnership Agreement. Both sides set the target to double bilateral trade by 2030.

    Qatar and India have a strong strategic relationship and given that the Indian economy is one of the fastest growing economies, the Indian side welcomed the decision of Qatar Investment Authority (QIA) to open an office in India. Both sides expressed satisfaction with the progress made by the Joint Task Force on Investments during its first meeting in June 2024, where various avenues for investments in India were discussed.

    The Qatar side commended the steps taken by India in making a conducive environment for Foreign Direct Investment and Foreign Institutional Investment and expressed interest to explore investment opportunities in different sectors, including infrastructure, technology, manufacturing, food security, logistics, hospitality, and other areas of mutual interest. In this regard, the Qatar side announced a commitment to invest USD 10 billion in India. The Indian side also appreciated Qatar’s efforts in enhancing its investment environment and its initiatives to attract Foreign Direct Investment. India also recognized Qatar’s growing role as a regional hub for goods and services, leveraging its strategic location, world-class infrastructure, and business-friendly policies. Both sides emphasized the importance of deepening cooperation between investment authorities, financial institutions, and businesses to explore new opportunities for investment and trade expansion.

    The parties shall expand and deepen mutually beneficial trade and economic cooperation between the two countries in accordance with their respective legislations and the provisions of international conventions to which they are parties. They shall cooperate in order to achieve stable growth and diversification of trade, increase the volume of exchanged products, and provide mutual services on a systematic and long-term basis. Additionally, they shall implement measures to attract and encourage the establishment of joint projects between the private sectors of both countries. In this regard, both sides welcomed convening of the Joint Business Forum inaugurated by the Ministers of Commerce and Industry of both countries on 18 February 2025.

    Recognizing the pivotal role of businesses in driving economic growth, both sides emphasized the importance of trade exhibitions as a strategic platform for promoting commercial partnerships, increasing and diversifying bilateral trade, and facilitating investments. In pursuit of these objectives, both sides will strengthen collaboration between their export promotion agencies to support enterprises in identifying opportunities, addressing market challenges, and increasing participation in international trade exhibitions. This initiative will enable businesses from both nations to showcase their products, explore joint ventures, and establish sustainable commercial ties.

    The two sides welcomed the operationalization of India’s Unified Payment Interface (UPI) in QNB’s Points of Sales in Qatar and looked forward to implement nation-wide roll-out of UPI acceptance in Qatar. They agreed to explore settlement of bilateral trade in respective currencies. QNB’s expansion is also welcomed in India through setting up of an office in GIFT City.

    The two sides shall work to further enhance bilateral energy cooperation, including through promotion of trade and mutual investments in energy infrastructure and regular meetings of the relevant stakeholders from both sides, including the Joint Task Force on Energy.

    The two leaders unequivocally condemned terrorism in all its forms and manifestations including cross-border terrorism and agreed to cooperate in combating this menace through bilateral and multilateral mechanisms. They agreed to enhance cooperation in information and intelligence sharing, developing and exchanging experiences, best practices and technologies, capacity building and to strengthen cooperation in law enforcement, anti-money laundering, drug-trafficking, Cybercrime and other transnational crimes. The two leaders also discussed ways and means to promote cooperation in cybersecurity, including prevention of use of cyberspace for terrorism, radicalisation and for disturbing social harmony. They emphasized the importance of holding regular meetings of the Joint Committee on Security and Law Enforcement.

    The two sides acknowledged health cooperation as one of the important pillars of bilateral ties and expressed their commitment to further strengthen collaboration in this important sector. The two sides appreciated the bilateral cooperation during the Covid-19 pandemic including through the Joint Working Group on Health. The Indian side expressed interest in enhancing exports of Indian pharmaceutical products and medical devices to Qatar. Both sides also expressed their desire to facilitate the registration of national companies and pharmaceutical products.

    The two sides expressed interest in pursuing deeper collaboration in technology and innovation, including emerging technologies, startups, and Artificial Intelligence. They discussed avenues for furthering e-Governance and sharing best practices in the digital sector. Both sides welcomed the participation of Indian startups in Web Summits in Doha, Qatar in 2024-25.

    The importance of food security and protection of supply chains was emphasized by the two sides and they agreed to further strengthen cooperation in this field.

    The two sides stressed the importance of enhancing cultural cooperation through exchanging participation in cultural events and supporting effective partnerships between cultural institutions in both countries. They also decided to further strengthen cooperation in the area of sports including mutual exchange and visits of sportsmen, organising workshops, seminars and conferences, exchange of sports publications between both nations. In this regard, the two sides welcomed the decision to celebrate India-Qatar Year of Culture, Friendship and Sports in the near future.

    The two sides highlighted that education is an important area of cooperation including strengthening institutional linkages and exchanges between higher educational institutions of both countries. They also emphasized on enhanced interactions among educational institutions, including through academic exchanges, joint research, students and scholar exchanges, and University-to-University cooperation of both countries.

    The two sides acknowledged that the centuries old people-to-people ties represent a fundamental pillar of the historic India-Qatar relationship. The Qatari leadership expressed deep appreciation for the role and contribution made by the Indian community in Qatar for the progress and development of their host country, noting that Indian citizens in Qatar are highly respected for their peaceful and hard-working nature. The Indian side conveyed deep appreciation to the leadership of Qatar for ensuring the welfare and well-being of this large and vibrant Indian community in Qatar. The Qatar side welcomed extension of e-visa facility by India to Qatari nationals.

    The two sides stressed upon the depth and importance of long standing and historical cooperation in the field of manpower mobility and human resources. The two sides agreed to hold regular meetings of the Joint Working Group on Labour and Employment to address issues related to expatriates, manpower mobility, dignity, safety and welfare of workers and matters of mutual interest.

    The two sides exchanged views on regional and international issues of mutual interest, including the security situation in the Middle East. They emphasized the importance of dialogue and diplomacy for peaceful resolution of international disputes. The two sides also appreciated the excellent coordination between the two sides in the UN and other multilateral fora.

    The Indian side thanked the Qatari side for its support to the growing India-GCC cooperation and for facilitating the inaugural India-GCC Joint Ministerial Meeting for Strategic Dialogue at the level of Foreign Ministers held in Riyadh on 9 September 2024 under Qatar’s Chairmanship. The two sides welcomed the outcomes of the inaugural India-GCC Joint Ministerial Meeting for Strategic Dialogue. Qatar side assured full support for deepening of the India-GCC cooperation under the recently adopted Joint Action Plan.

    In the context of UN reforms, both leaders emphasized the importance of a reformed and effective multilateral system, centered on a UN reflective of contemporary realities, as a key factor in tackling global challenges. The two sides stressed the need for UN reforms, including of the Security Council. Both sides stressed the importance of addressing shared global challenges through coordinated efforts within the framework of the United Nations, its specialized agencies, and programs, as well as through technical cooperation to advance the achievement of UN Sustainable Development Goals (SDGs). Both sides agreed to engage in close cooperation and support each other at the United Nations including supporting each other’s candidatures to multilateral forums.

    The following documents were signed/exchanged during the visit, which will further deepen the multifaceted bilateral relationship as well as open avenues for newer areas of cooperation:

    · Agreement on the Establishment of Bilateral Strategic Partnership

    · Revised Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and its Protocol

    · MoU between Ministry of Finance, India and Ministry of Finance, Qatar on Financial and Economic Collaboration

    · MoU on Cooperation in Field of Youth and Sports

    · MOU for Cooperation in the field of Documents and Archives

    · MoU between Invest India and Invest Qatar

    · MoU between Confederation of Indian Industry and Qatari Businessmen Association

    HH the Amir thanked Prime Minister Shri Narendra Modi for the warm hospitality accorded to him and his delegation. The visit reaffirmed the strong bonds of friendship and cooperation between India and Qatar. The leaders expressed optimism that this renewed partnership would continue to grow, benefiting the people of both countries and contributing to regional and global stability.

     

    ***

    MJPS/SR

    (Release ID: 2104490) Visitor Counter : 138

    MIL OSI Asia Pacific News –

    February 19, 2025
  • MIL-OSI Asia-Pac: India – Qatar Joint Statement (February 18, 2025)

    Source: Government of India (2)

    Posted On: 18 FEB 2025 8:17PM by PIB Delhi

    At the invitation of Prime Minister of India His Excellency Shri Narendra Modi, His Highness the Amir of the State of Qatar, Sheikh Tamim bin Hamad Al-Thani paid a State Visit to India on 17-18 February 2025. HH the Amir was accompanied by a high-level delegation comprising Ministers, officials and business leaders. This was the second State Visit of HH the Amir to India.

    HH the Amir was received by Hon’ble President of India Smt Droupadi Murmu and Prime Minister Shri Narendra Modi at the Forecourt of Rashtrapati Bhawan on 18 February and was accorded a ceremonial welcome. Hon’ble President also hosted a banquet reception in honour of HH the Amir and accompanying delegation.

    Prime Minister Shri Narendra Modi held bilateral talks with HH the Amir at Hyderabad House on 18 February. Both leaders recalled the historic trade linkages, deep-rooted people-to-people ties and robust bilateral relations between both countries. They expressed the desire for further expanding and deepening of the multifaceted relationship between both countries. In this context, they expressed happiness on the signing of the ‘Agreement on the Establishment of Bilateral Strategic Partnership’ between the two sides.

    In light of the newly established Strategic Partnership, the two sides reaffirmed their commitment to further strengthen the bilateral relations through regular and structured cooperation in all areas, including political, trade, investment, security, energy, culture, education, technology, innovation, sustainability and people-to-people ties. In this regard, the two sides expressed happiness at the signing of the revised Double Taxation Avoidance Agreement and also agreed to expedite negotiations on the India-Qatar Bilateral Investment Treaty.

    The two sides noted with satisfaction that regular interactions at various levels have helped provide momentum to the multifaceted bilateral cooperation. They recalled the successful visit of HH the Amir to India in March 2015 and the visits of Prime Minister to Qatar in June 2016 and February 2024. The two sides agreed to continue the high-level exchanges through regular bilateral mechanisms at Ministerial and senior-official levels.

    The two sides noted that trade and commerce has been a strong pillar of bilateral economic cooperation between the two countries and emphasized on the potential for further growth and diversification in bilateral trade. The two sides welcomed the elevation of the existing Joint Working Group on Trade and Commerce into a Joint Commission on Trade and Commerce. The Joint Commission will be an institutional mechanism to review and monitor the entire spectrum of economic ties between the two countries and will be headed by the Ministers of Commerce and Industry on both sides.

    The two sides laid emphasis on strengthening collaborations between their business and industry bodies. In this context, they welcomed the holding of the first meeting of the Joint Business Council on 13 February 2025.

    The two sides agreed on the need to explore strategies for enhanced and diversified trade between the two countries and address on priority market access issues related to trade in goods and services. In this regard, the two sides agreed to explore the possibility of entering into a bilateral Comprehensive Economic Partnership Agreement. Both sides set the target to double bilateral trade by 2030.

    Qatar and India have a strong strategic relationship and given that the Indian economy is one of the fastest growing economies, the Indian side welcomed the decision of Qatar Investment Authority (QIA) to open an office in India. Both sides expressed satisfaction with the progress made by the Joint Task Force on Investments during its first meeting in June 2024, where various avenues for investments in India were discussed.

    The Qatar side commended the steps taken by India in making a conducive environment for Foreign Direct Investment and Foreign Institutional Investment and expressed interest to explore investment opportunities in different sectors, including infrastructure, technology, manufacturing, food security, logistics, hospitality, and other areas of mutual interest. In this regard, the Qatar side announced a commitment to invest USD 10 billion in India. The Indian side also appreciated Qatar’s efforts in enhancing its investment environment and its initiatives to attract Foreign Direct Investment. India also recognized Qatar’s growing role as a regional hub for goods and services, leveraging its strategic location, world-class infrastructure, and business-friendly policies. Both sides emphasized the importance of deepening cooperation between investment authorities, financial institutions, and businesses to explore new opportunities for investment and trade expansion.

    The parties shall expand and deepen mutually beneficial trade and economic cooperation between the two countries in accordance with their respective legislations and the provisions of international conventions to which they are parties. They shall cooperate in order to achieve stable growth and diversification of trade, increase the volume of exchanged products, and provide mutual services on a systematic and long-term basis. Additionally, they shall implement measures to attract and encourage the establishment of joint projects between the private sectors of both countries. In this regard, both sides welcomed convening of the Joint Business Forum inaugurated by the Ministers of Commerce and Industry of both countries on 18 February 2025.

    Recognizing the pivotal role of businesses in driving economic growth, both sides emphasized the importance of trade exhibitions as a strategic platform for promoting commercial partnerships, increasing and diversifying bilateral trade, and facilitating investments. In pursuit of these objectives, both sides will strengthen collaboration between their export promotion agencies to support enterprises in identifying opportunities, addressing market challenges, and increasing participation in international trade exhibitions. This initiative will enable businesses from both nations to showcase their products, explore joint ventures, and establish sustainable commercial ties.

    The two sides welcomed the operationalization of India’s Unified Payment Interface (UPI) in QNB’s Points of Sales in Qatar and looked forward to implement nation-wide roll-out of UPI acceptance in Qatar. They agreed to explore settlement of bilateral trade in respective currencies. QNB’s expansion is also welcomed in India through setting up of an office in GIFT City.

    The two sides shall work to further enhance bilateral energy cooperation, including through promotion of trade and mutual investments in energy infrastructure and regular meetings of the relevant stakeholders from both sides, including the Joint Task Force on Energy.

    The two leaders unequivocally condemned terrorism in all its forms and manifestations including cross-border terrorism and agreed to cooperate in combating this menace through bilateral and multilateral mechanisms. They agreed to enhance cooperation in information and intelligence sharing, developing and exchanging experiences, best practices and technologies, capacity building and to strengthen cooperation in law enforcement, anti-money laundering, drug-trafficking, Cybercrime and other transnational crimes. The two leaders also discussed ways and means to promote cooperation in cybersecurity, including prevention of use of cyberspace for terrorism, radicalisation and for disturbing social harmony. They emphasized the importance of holding regular meetings of the Joint Committee on Security and Law Enforcement.

    The two sides acknowledged health cooperation as one of the important pillars of bilateral ties and expressed their commitment to further strengthen collaboration in this important sector. The two sides appreciated the bilateral cooperation during the Covid-19 pandemic including through the Joint Working Group on Health. The Indian side expressed interest in enhancing exports of Indian pharmaceutical products and medical devices to Qatar. Both sides also expressed their desire to facilitate the registration of national companies and pharmaceutical products.

    The two sides expressed interest in pursuing deeper collaboration in technology and innovation, including emerging technologies, startups, and Artificial Intelligence. They discussed avenues for furthering e-Governance and sharing best practices in the digital sector. Both sides welcomed the participation of Indian startups in Web Summits in Doha, Qatar in 2024-25.

    The importance of food security and protection of supply chains was emphasized by the two sides and they agreed to further strengthen cooperation in this field.

    The two sides stressed the importance of enhancing cultural cooperation through exchanging participation in cultural events and supporting effective partnerships between cultural institutions in both countries. They also decided to further strengthen cooperation in the area of sports including mutual exchange and visits of sportsmen, organising workshops, seminars and conferences, exchange of sports publications between both nations. In this regard, the two sides welcomed the decision to celebrate India-Qatar Year of Culture, Friendship and Sports in the near future.

    The two sides highlighted that education is an important area of cooperation including strengthening institutional linkages and exchanges between higher educational institutions of both countries. They also emphasized on enhanced interactions among educational institutions, including through academic exchanges, joint research, students and scholar exchanges, and University-to-University cooperation of both countries.

    The two sides acknowledged that the centuries old people-to-people ties represent a fundamental pillar of the historic India-Qatar relationship. The Qatari leadership expressed deep appreciation for the role and contribution made by the Indian community in Qatar for the progress and development of their host country, noting that Indian citizens in Qatar are highly respected for their peaceful and hard-working nature. The Indian side conveyed deep appreciation to the leadership of Qatar for ensuring the welfare and well-being of this large and vibrant Indian community in Qatar. The Qatar side welcomed extension of e-visa facility by India to Qatari nationals.

    The two sides stressed upon the depth and importance of long standing and historical cooperation in the field of manpower mobility and human resources. The two sides agreed to hold regular meetings of the Joint Working Group on Labour and Employment to address issues related to expatriates, manpower mobility, dignity, safety and welfare of workers and matters of mutual interest.

    The two sides exchanged views on regional and international issues of mutual interest, including the security situation in the Middle East. They emphasized the importance of dialogue and diplomacy for peaceful resolution of international disputes. The two sides also appreciated the excellent coordination between the two sides in the UN and other multilateral fora.

    The Indian side thanked the Qatari side for its support to the growing India-GCC cooperation and for facilitating the inaugural India-GCC Joint Ministerial Meeting for Strategic Dialogue at the level of Foreign Ministers held in Riyadh on 9 September 2024 under Qatar’s Chairmanship. The two sides welcomed the outcomes of the inaugural India-GCC Joint Ministerial Meeting for Strategic Dialogue. Qatar side assured full support for deepening of the India-GCC cooperation under the recently adopted Joint Action Plan.

    In the context of UN reforms, both leaders emphasized the importance of a reformed and effective multilateral system, centered on a UN reflective of contemporary realities, as a key factor in tackling global challenges. The two sides stressed the need for UN reforms, including of the Security Council. Both sides stressed the importance of addressing shared global challenges through coordinated efforts within the framework of the United Nations, its specialized agencies, and programs, as well as through technical cooperation to advance the achievement of UN Sustainable Development Goals (SDGs). Both sides agreed to engage in close cooperation and support each other at the United Nations including supporting each other’s candidatures to multilateral forums.

    The following documents were signed/exchanged during the visit, which will further deepen the multifaceted bilateral relationship as well as open avenues for newer areas of cooperation:

    · Agreement on the Establishment of Bilateral Strategic Partnership

    · Revised Agreement for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and its Protocol

    · MoU between Ministry of Finance, India and Ministry of Finance, Qatar on Financial and Economic Collaboration

    · MoU on Cooperation in Field of Youth and Sports

    · MOU for Cooperation in the field of Documents and Archives

    · MoU between Invest India and Invest Qatar

    · MoU between Confederation of Indian Industry and Qatari Businessmen Association

    HH the Amir thanked Prime Minister Shri Narendra Modi for the warm hospitality accorded to him and his delegation. The visit reaffirmed the strong bonds of friendship and cooperation between India and Qatar. The leaders expressed optimism that this renewed partnership would continue to grow, benefiting the people of both countries and contributing to regional and global stability.

     

    ***

    MJPS/SR

    (Release ID: 2104490) Visitor Counter : 22

    MIL OSI Asia Pacific News –

    February 19, 2025
  • MIL-OSI United Nations: Experts of the Committee on Economic, Social and Cultural Rights Congratulate Rwanda on Number of New Jobs Created, Ask Questions on Women’s Political Representation and Recognising the Cultures of Rwanda’s Different Ethnic Groups

    Source: United Nations – Geneva

    The Committee on Economic, Social and Cultural Rights today concluded its review of the fifth periodic report of Rwanda, with Committee Experts commending the State on the number of new jobs created, while raising questions about women’s political representation and how Rwanda recognised the cultures of its different ethnic groups. 

    Preeti Saran, Committee Expert and Country Taskforce Member, was impressed with some of the figures shared, including seven per cent gross domestic product growth and 1.3 million jobs created.  These were commendable and Rwanda should be congratulated.   

    Peters Sunday Omologbe Emuze, Committee Vice-Chair and Country Rapporteur for Rwanda, said Rwanda had made significant progress in gender equality, and especially women’s political representation.  What steps were being taken to increase women’s representation in local administration and the private sector? How was the gender pay gap addressed? What was being done to combat discrimination against women and stereotypes? 

    Ms. Saran said each ethnic group in Rwanda had a rich cultural heritage.  For the sake of national unity and reconciliation, if everyone was being referred to as Rwandan, how did the State propagate the cultural richness of the population?   Rwanda had been extremely welcoming to refugees from all over the world, who brought their own specific languages and cultures.  What measures had the State party taken to ensure equal cultural rights for ethnic groups that had come as aliens, refugees or asylum seekers? 

    The delegation said over the years, Rwanda had implemented measures to achieve gender equality, particularly in Parliament, where it was around 63 per cent in the Chamber of Deputies and around 53 per cent in the Senate.  Quotas were in place which mandated that a minimum of 30 per cent of leaders should be women.  When the issue of equality was dealt with properly, this had a cascading effect on other policies.  A few years ago, the State recognised that gender-based violent crimes were specific in nature and needed to be treated in a certain way. 

    The delegation said there was no significant cultural diversity within the country, as everyone shared the same language and culture.  Traditionally the ethnic groups had been defined based on occupation and turning them into an ethnicity was introduced by the colonialists.  It had been entrenched in identity cards for Tutsis, Hutus and Twas.  This negated the fact that people could have moved from one group to another.   There were no significant differences in culture between these groups.  Rwanda had received a number of people who faced difficulties in their own countries. Diversity days were organised at schools, encouraging refugees and asylum seekers to share their culture. 

    Emmanuel Ugirashebuja, Minister of Justice and Attorney General of Rwanda and head of the delegation, said in 2023, Rwanda further refined its governance framework by aligning the schedules of presidential and parliamentary elections, enhancing efficiency and reducing electoral costs.  During the period under consideration, Rwanda successfully completed its ambitious 2020 Vision and adopted the Vision 2050.  From 2018 to 2024, Rwanda implemented its first national strategy for transformation, which laid the foundation for sustainable development, and was succeeded by the second national strategy for transformation, which ran until 2029.   Through these strategies, Rwanda maintained steady economic growth, with gross domestic product expanding at an average of 7 per cent and per capita income rising from $729 to $1,040 in 2023/2024. 

    In concluding remarks, Mr. Emuze thanked the Rwandan delegation for attending the dialogue, noting the high calibre of the delegation.  The Committee wished the delegation a safe journey home. 

    In his concluding remarks Mr. Ugirashebuja expressed appreciation for the constructive dialogue with the Committee.  The State had learnt many valuable lessons and looked forward to receiving the Committee’s recommendations.  Mr. Ugirashebuja extended an open invitation to the Committee to visit Rwanda in the future. 

    The delegation of Rwanda was comprised of representatives from the Ministry of Justice; the National Institute of Statistics; the Rwanda Education Board; the Department of International Justice Judicial Cooperation; and the Permanent Mission of Rwanda to the United Nations Office at Geneva.

    The Committee’s seventy-seventh session is being held until 28 February 2025.  All documents relating to the Committee’s work, including reports submitted by States parties, can be found on the session’s webpage.  Webcasts of the meetings of the session can be found here, and meetings summaries can be found here.

    The Committee will next meet in public at 3 p.m. on Tuesday, 18 February to begin its consideration of the seventh periodic report of the Philippines (E/C.12/PHL/7).

    Report

    The Committee has before it the fifth periodic report of Rwanda (E/C.12/RWA/5).

    Presentation of Report

    EMMANUEL UGIRASHEBUJA, Minister of Justice and Attorney General of Rwanda and head of the delegation, said since the last review by the Committee over a decade ago, Rwanda had undergone significant changes in its policy, legal and institutional landscape.  In 2023, Rwanda further refined its governance framework by aligning the schedules of presidential and parliamentary elections, enhancing efficiency, and reducing electoral costs. 

    At the institutional level, Rwanda established the Rwanda Forensic Laboratory in 2016, upgrading it to the Rwanda Forensic Institute in 2023.  The Institute had enhanced forensic and advisory services, strengthening accountability in sectors critical to economic, social and cultural rights.  Its digital forensic and document services helped combat financial crimes like fraud and embezzlement.  In 2017, the Rwanda Investigation Bureau was established to enhance specialisation and professionalism in crime investigation. 

    In the judiciary, Rwanda made significant strides in strengthening its justice system.  In 2018, the Court of Appeal was established, further enhancing the country’s capacity to provide effective legal recourse.   In 2024, the establishment of an Appeal Tribunal to hear matters relating to refugee and asylum claims reinforced Rwanda’s commitment to upholding the rights of individuals in vulnerable situations.  Rwanda’s legal framework strongly supported the protection of economic, social and cultural rights, as enshrined in the Constitution.  Since the last report, Rwanda had enacted several laws that aligned with the provisions of the Covenant and contributed to the progressive realisation of economic, social and cultural rights.  These included the education law that guaranteed access to quality education at all levels, as well as health laws. 

    During the period under consideration, Rwanda successfully completed its ambitious 2020 Vision and adopted the Vision 2050.  From 2018 to 2024, Rwanda implemented its first national strategy for transformation, which laid the foundation for sustainable development, and was succeeded by the second national strategy for transformation, which ran until 2029.   Through these strategies, Rwanda maintained steady economic growth, with gross domestic product expanding at an average of 7 per cent and per capita income rising from $729 to $1,040 in 2023/2024.  

    Infrastructure development advanced with the construction of over 1,600 kilometres of national roads and 4,137 kilometres of feeder roads.   Job creation efforts led to over 1.3 million decent and productive jobs, while financial inclusion improved from 89 per cent in 2017 to 96 per cent by 2024.  Life expectancy also increased from 66.6 in 2017 to 69.9 years in 2024. 

    Rwanda also significantly strengthened its healthcare system under the strategy. Seven new hospitals were added to the existing 52, while 23 were rehabilitated or expanded.  Community-based health insurance coverage reached 93 per cent of the population. Healthcare modernisation included advanced imaging, laboratory equipment, local pharmaceutical manufacturing, and digital health systems.  

    In 2023, Rwanda, in partnership with Germany Biotechnology Company BioNTech, set-up an mRNA vaccine manufacturing facility, the first of its kind on the African continent, which would have the capacity to produce between 50 and 100 million doses of mRNA vaccines annually, and conduct trials on new therapeutics for malaria, tuberculosis, HIV, cancers and other diseases.  

    Through the Girinka programme (one cow per family programme), Rwanda distributed 333,146 cows to an equivalent number of households.  Rwanda valued the opportunity to engage in a constructive dialogue with the Committee.

    Questions by a Committee Expert

    PETERS SUNDAY OMOLOGBE EMUZE, Committee Vice-Chair and Country Rapporteur for Rwanda, asked how the 2015 constitutional amendments had affected Rwanda’s commitment to international human rights standards.  Did it enable the State party to override Covenant protections in favour of domestic law? What measures were being taken to ensure that the provisions of the Covenant were invoked by domestic courts? 

    What training programmes were in place for judges, law enforcement and government officials to ensure consistent application of the Covenant?  The important work of Rwanda’s national human rights institution was noted.  Was the selection process of its members carried out by a committee appointed by the President?  Did members require clearance from the Prime Minister’s office for official travel outside Rwanda?  Had the State party accepted the recommendations of the Global Alliance of National Human Rights Institutions to strengthen the institution in line with the Paris Principles?

    What measures had been taken to guarantee that human rights defenders could continue their work without undue restrictions on freedoms of expression, peaceful assembly and association?  What steps were taken to protect them from risks of unlawful killings, enforced disappearances, harassment and intimidation, including judicial harassment?  Could the State party clarify the concerns regarding non-governmental organization registration requirements?  Were there any obstacles for opposition groups to promote and advocate for the promotion of human rights, including economic, social and cultural rights? 

    When would the State party finalise a national action plan for business and human rights?  What steps were being taken to put in place a comprehensive legal and regulatory framework for human rights due diligence for businesses?  What measures were in place to ensure Rwanda met its nationally determined contributions under the Paris Agreement? 

    What measures were in place to combat corruption, particularly in public procurement and State-owned enterprises?  What challenges did anti-corruption institutions face in maintaining independence and effectiveness?  What measures were being taken to address them?  The Committee noted Rwanda’s legislative efforts to combat discrimination.  However, reports indicated persistent structural inequalities, particularly affecting Batwa people, women and girls, people living in deprived urban and rural areas, persons with disabilities, people living in poverty, and lesbian, gay, bisexual, transgender and intersex persons.  How did Rwanda plan to address these challenges? 

    How did Rwanda plan to address the absence of disaggregated data to assess the situation of the Batwa people?  What steps were being taken to combat poverty, high infant mortality, malnutrition, and lower educational outcomes among the Batwa? What kind of barriers did the Batwa continue to face to land titling and how did Rwanda plan to secure their rights to land ownership?  What measures were in place to prevent forced displacement of the Batwa people from their ancestral lands?  How was adequate compensation provided when Batwa lands were expropriated?  How did the State party ensure consultations with Batwa people in decisions likely to affect them?

    Rwanda had made significant progress in gender equality, and especially women’s political representation.  What steps were being taken to increase women’s representation in local administration and the private sector?  How was the gender pay gap addressed?  What was being done to combat discrimination against women and stereotypes?  How had the Rwanda Gender Monitoring Office and its Gender Management Information System contributed to tracking gender equality initiatives? 

    Responses by the Delegation

    The delegation said since the 2015 Constitutional amendments, no new organic laws had come into place.  There was consistent training on the use of human rights in courts.  However, the members of the bar tended not to apply international conventions in the courts. The reason for this was because the Constitution provided for a whole section of bill of rights, which was a replica of the Covenant.  However, lawyers were still trained on the use of human rights conventions.   

    Members of the human rights institution were manually selected via a presidential order.  This was a rigorous process, and many candidates were considered.  The appointment process was comparable to any other country with human rights mechanisms.  Whenever Commissioners wanted to travel, they informed the Minister’s office and a document was provided, called the travel clearance. Given that this caused significant confusion, the Government had decided to do away with the travel clearance.   

    Rwanda did all it could to strengthen the National Commission of Human Rights, and put in place any recommendations received. Rwanda was on track to reach its goals regarding carbon emissions.  The State was encouraging businesses to go green, which in turn would create “green jobs” which would contribute to more employment.  An example of this could be seen in the State employing young people to plant trees.  The Rwandan Government had heavily invested in areas key to social equality.  The community-based insurance now extended to certain diseases previously not covered, including cancer. 

    Rwanda aimed to achieve zero tolerance for corruption.  Key institutions like the Ombudsman’s office had played a key role towards achieving this goal.  Rwanda had improved its global ranking from 49th to 43rd place in 2024 in the Transparency Index Global Corruption Index.

    Rwandans and the Batwa spoke the same language and had the same culture.  The Batwa people could be found throughout the country and did not live in a designated area.  Rwanda aimed to ensure no one was left behind, regardless of their status.  Land registration helped to resolve dispute around land, and to ensure that land was adequately registered. 

    Over the years, Rwanda had implemented measures to achieve gender equality, particularly in Parliament, where it was around 63 per cent in the Chamber of Deputies and around 53 per cent in the Senate.  Quotas were in place which mandated that a minimum of 30 per cent of leaders should be women.  When the issue of equality was dealt with properly, this had a cascading effect on other policies.  A few years ago, the State recognised that gender-based violent crimes were specific in nature and needed to be treated in a certain way. 

    No discrimination against any group was tolerated in Rwanda.  Measures had been put in place to ensure that anyone who faced discrimination was able to access fast reparations.  There were many issues which were largely context-specific to Rwanda. 

    Questions by Committee Experts

    PREETI SARAN, Committee Expert and Taskforce Member, was impressed with some of the figures shared, including seven per cent gross domestic product growth and 1.3 million jobs created.  These were commendable and Rwanda should be congratulated.   What kind of resource constraints had the State faced in budgetary allocations for social spending?  What challenges had there been when dealing with external partners? 

    KARLA LEMUS DE VÁSQUE, Committee Expert and Taskforce Member, said marital violence affected 46 per cent of women who were married and 18 per cent of men, with many never seeking help for the violence they had suffered.  What measures had been put in place to combat the cultural norms which perpetuated marital violence?  How were victims of violence being supported so they could report the crime?

    A Committee Expert asked what steps were being taken by the Government to ensure safe access by humanitarian organizations to the population affected by the conflict in the Democratic Republic of the Congo?  How had the State ensured its policies and actions did not obstruct humanitarian aid? What was the coordination framework that the State had with armed groups operating in the Democratic Republic of the Congo, particularly the M23?  How might the State respond to the concerns regarding any potential support for these armed groups? 

    What measures had been put in place to prevent and punish any involvement by Rwandan stakeholders in conflict zones in the Democratic Republic of the Congo?  What measures had the State adopted to ensure that no armed group benefitted from support from the State?  What measures had been put in place to remedy any violations, including forced labour in mining areas under the control of armed groups, among others? 

    Another Expert asked about the role of civil society when drafting reports to treaty bodies?  Were all civil society organizations invited to participate in the drafting procedures?  What was the position of Rwanda on the Rome Statute?  Was there a possibility that the Government might consider acceding to it? Rwanda had extraterritorial obligations. The President had reiterated a lack of knowledge regarding the Rwandan military participating in the conflict of the Democratic Republic of the Congo.  How was oversight of the military activities ensured?  How did Rwanda ensure that armed groups operating in other countries received no support?

    A Committee Expert asked what the State was doing to combat the illicit trade of minerals?  What specific measures were taken to enhance specific imports and exports? 

    PETERS SUNDAY OMOLOGBE EMUZE, Vice-Chair and Taskforce Leader for Rwanda, said there had been allegations of Government members committing unlawful killings, enforced disappearances, and intimidation and reprisals, against those defending human rights.  What had the State party done to prevent this? Despite measures taken by the State party to improve rights for indigenous peoples, challenges remained. How did the State party intend to address challenges in this regard, including the lack of disaggregated data? How would Rwanda address challenges such as poverty, infant mortality, lower school attendance, and higher drop-out rates, among others? 

    Responses by the Delegation

    The delegation said Rwanda had challenges in terms of budget.  The State aimed to address this through development partners.  However, resources were not always permanent.  Although Rwanda worked with development partners, the State aimed to be financially stable in terms of its own financing. 

    Rwanda had developed mechanisms to capture data regarding gender-based violence.  Initially, people were scared to report cases due to stigmatisation.  Investigators had been trained to interview victims of gender-based violence.  When cases proceeded, it was ensured that they were not held in public, so as not to endanger the lives of the victims. 

    The Democratic Republic of the Congo had its own problems as did Rwanda, and the State could not bear the burden of others’ problems.  Anything happening beyond the territory of Rwanda should be dealt with by those States. 

    Civil society played an important role in the drafting of the report and in helping Rwanda achieve its human rights obligations. Rwanda had not yet joined the Rome Statute, but if the appropriate time came and if it was necessary, the State would willingly join the Statute.  At present, the State was not considering joining the Statue in the near future. 
    Rwanda was the first country in the Great Lakes region to commit to a due diligence mechanism.  This ensured Rwanda could not be used as a route for illicit mines. There were mechanisms in place to protect against enforced disappearances.  There was zero tolerance for anyone who threatened human rights defenders. 

    Questions by a Committee Expert

    PREETI SARAN, Committee Expert and Taskforce Member, asked what recent measures the State party had taken to address unemployment rates and to guarantee access to work?  What specific steps had been taken to address the problem of labour under-utilisation?  What major obstacles had Rwanda faced in addressing the employment challenge?  How was the integration of women into the labour force being promoted? 

    What specific steps had the State party taken for those facing discrimination to access the labour market.  What had Rwanda done to enforce laws dealing with discrimination at the workplace and to encourage employers to adopt anti-discrimination measures specifically related to sexual orientation at the workplace? How were systemic barriers for persons with disabilities being removed?  What measures had been taken to enable the transition of workers from the informal to the formal sector, particularly for women, the disadvantaged, and persons with disabilities?  What was the anticipated timeframe for establishing a minimum wage? 

    Many workers were reportedly exposed to frequent occupational accidents due to unsafe working conditions, leading to occupational injuries and fatalities.  Had the State party formulated an updated national policy on occupational health and safety?  How did the State party reinforce and implement the Labour Code on occupational health and safety?  Had the State party developed rights awareness programmes targeting domestic workers and employers? 

    What steps had been taken to establish a safe reporting system for domestic workers to report workplace violence?  What initiatives were in place to provide confidential and accessible health care for domestic workers?  What steps had the State party taken to remove any such legal barriers to the enjoyment of the right to form trade unions and the right to strike.

    The adoption of the updated national social protection policy (2020), which aimed to ensure that Rwandan citizens had a dignified standard of living, was commendable.  Were there any proposals to improve and expand the coverage process to ensure that it included the widest possible population, particularly the most marginalised and disadvantaged in the informal sector?  What steps had the State party taken to expand the community-based health insurance scheme to cover specialised health services, medicines, assistive devices, and commodities required by persons with disabilities? 

    Responses by the Delegation

    The delegation said employment was a concern in Rwanda.  Rwanda had a young population and the State needed to create an enabling environment for the youth to thrive.  It was hoped the law on startups would ensure easy financing of start-ups for the youth. A proportion of the laws provided for special consideration for women and people living with disabilities, to ensure these traditionally marginalised groups could access these resources. 

    Despite the efforts that the Government had put in place, there were still instances of gender-based discrimination.  There had been instances in the private sector where questions had been asked about women’s marital status to ascertain if they would be looking to seek maternity leave.  The State was looking at how to incentivise the private sector to ensure they did not discriminate based on gender.  No one in Rwanda was discriminated against based on their sexual orientation.  If discrimination was there, the State worked with civil society to address this.  It was important to have a synergy with civil society organizations to address persistent discriminatory issues.  There were quotas of 30 per cent for women, and the State monitored these closely to ensure gender equity was being achieved.   

    There were a lot of workers employed in the informal sector, and the State tried to formalise these areas.  Cooperatives were important in ensuring people came together, and worked like trade unions to highlight challenges faced by people in the informal sector.  There had been a growth in the number of cooperatives registered over recent years. The State had seen unfortunate incidents where people had been trapped in mines due to unsuitable mining.  The Rwanda mining board ensured that it monitored mining sites; however, people sometimes ventured into illegal mining at nighttime and ended up being trapped.  Work was being done with the local governments to ensure these unfortunate situations were avoided. 

    The minimum wage was a difficult debate.  The Government was on the right path regarding what an acceptable minimum wage was in Rwanda.  The process was long, but the Government aimed to develop a suitable minimum wage for the greater good of the country.  Laws guaranteed safety for domestic workers, including salaries and leave. Labour inspectors took steps to ensure the legal mechanisms were being utilised. 

    Questions by Committee Experts

    A Committee Expert said the issues of the Democratic Republic of the Congo were relevant.  What tools and mechanisms had the State created to ensure there was respect for economic, cultural and social rights?  How was it ensured that impunity was combatted abroad, particularly in the context of the armed conflict? 

    KARLA LEMUS DE VÁSQUE, Committee Expert and Taskforce Member, acknowledged that the State had extended fully-paid maternity leave for mothers in all sectors, but there were challenges to ensuring the legislation was enforced, particularly in the informal sector. What mechanisms were in place to ensure all working mothers could enjoy maternity leave?  Had the State considered implementing a specific measure to ensure women who gave birth to children with disabilities were given maternity leave commiserate with the situation of their child?  Were there incentives to encourage men to use paternity leave?

    What efforts were being carried out to punish employers who were in breach of child labour laws?  What results had the new national strategy on child labour yielded?  There were still high levels of poverty, especially for families.  What was the State doing in terms of the social schemes designed to eradicate extreme poverty?  What challenges did small-scale farmers meet when it came to increasing their yield and diversifying their crop?  What support programmes were in place for them?  Had the State considered expanding the food assistance programmes for vulnerable groups?

    A study of Rwanda’s development bank showed many people on low income still did not have access to affordable housing. What policies had been adopted to ensure the cost of housing was accessible?  What percentage of the national budget was set aside for the building and maintenance of social housing?  What initiatives had been launched to ensure that people who were vulnerable had access to affordable housing?  Had any laws been passed on rent control?  What measures could be implemented to ensure water rates were affordable? 

    Current adaptation measures were not enough to mitigate the impacts of climate change?  Had studies or surveys been carried out to assess the impact of climate change, and how had the State responded to findings?  What food resilience programmes could the State develop, including food storage programmes?  What measures had been implemented to ensure enough resources were set aside for the health sector, including for the most disadvantaged groups? What measures had been developed to extend the scope and coverage of mental health services?  What strategies had been developed to increase the number of qualified birth attendants in remote areas?  What measures had been implemented to strengthen investment in infrastructure?  How was equitable access to contraception guaranteed?   

    Responses by the Delegation

    The delegation said in January 2025, the Cabinet approved the resolution on the additional package of services for the community-based health insurance, including kidney transplants, cancer care, blood transfusions, knee and hips replacements, dialysis and prosthetics, among other procedures.  These were now all covered by the community-based health insurance. 

    The one cow per family programme provided a cow to families in the most vulnerable communities.  More than 14,500 families had been provided with furnished housing and 124 model villages had been established between 2017 and 2024, with all the essential amenities. 

    Rwanda did not have effective jurisdiction over any country and could not be held accountable for human rights violations beyond its borders.  The problems of the Democratic Republic of the Congo were internal.  Rwanda would welcome refugees from the Democratic Republic of the Congo if the problems persisted. 

    Since the COVID-19 pandemic, certain programmes had been implemented, including a voluntary saving scheme which was open to any citizen.  The International Labour Organization, in collaboration with Rwanda, had recruited a team to conduct a study on the barriers to social protection in the informal sector, and it would develop recommendations to address these. 

    Since 2023, paid maternity leave had increased from 12 to 14 weeks.  New changes in the law mandated that a pregnant woman or a breastfeeding mother should not be made to do any work that was too physically demanding or damaging to their overall health.  Those on maternity leave received their full salary.   Regular labour inspections were conducted, with more than 5,000 inspections carried out every year.  More than 1,500 of the enterprises where inspections took place were in the informal sector.   In the 2023-2024 fiscal year, 112 businesses were administratively sanctioned due to employment-related issues.  In the same period, 26 investigations had been conducted into cases of child labour, and 18 had been referred to the courts with five convicted. 

    The Government of Rwanda had implemented various social protection initiatives to eliminate extreme poverty.  In 2024, over 102,000 vulnerable individuals received monthly cash transfers and more than 80,000 households benefitted from flexible employment programmes.  As of May 2024, there had been an old age grant for impoverished individuals over the age of 65.  As of 2024, 315,327 households had been enrolled in the programme for sustainable graduation, where they received mentorship, financial support, and access to productive assets. 

    It was becoming more difficult for farmers to predict the weather, given the adverse impacts of climate change.  Pilot projects were launched to allow farmers to access buyers in value chains, by ensuring their quality standards were high. The Rwanda culture board helped to increase agriculture and animal resources, advising farmers on the best seeds for each area of the country to ensure the best harvest.  The Government heavily subsidised fertilizer for farmers to increase their output.  The Government subsidised up to 40 per cent of the cost of water, and access to clean water had increased substantially in the country. 

    Rwanda aimed to quadruple its workforce of healthcare service providers.  Below the age of 18, parental consent was required for any health intervention, including contraception and reproductive health services.  To enhance access to sexual reproductive health services, the age of consent should be reduced to 15 years.  To address this, a draft health service law was currently under consideration by the Parliament.  The level of teen pregnancy had decreased due to education and sensitisation, but it was also expected the draft health service law would result in a further decrease in teen pregnancy. 

    Questions by Committee Experts

    KARLA LEMUS DE VÁSQUE, Committee Expert and Taskforce Member, asked if there was any recent study on the deficit in housing which would help address current challenges?  Were there any laws on rent control? 

    How was the State addressing social and economic gaps which could address the prevalence of non-communicable diseases. Despite progress made in public health, communicable diseases, including malaria and HIV/AIDS, were a cause for concern. What measures had been adopted to strengthen health infrastructure in areas where access was limited?  What was being done to improve the prevention programmes? 

    A Committee Expert asked about the national health insurance; how did it function?  Did the State consider sharing revenues with areas where they obtained the resources from? 

    Another Expert said the country’s drug policy was focused on criminalisation and punitive measures.  Would the State consider decriminalising drug use and changing the approach to one that was health-based?   What measures had been taken to provide specialised training to law enforcement agents?  What was being done to mainstream mental health in primary health services? 

    A Committee Expert asked whether Rwanda had considered using human rights methodologies to design and better assess public policies? 

    An Expert asked about access to water in rural areas? What measures had the State taken to address climate change and its impact on the agricultural sector? 

    Responses by the Delegation

    The delegation said there had been a survey on housing deficits which had been presented in the Cabinet.  There were no laws on rent to reduce increases, but it was illegal to charge rent in foreign currencies, which helped to ensure rent was controlled.  Community health care workers were taught to deal with non-communicable diseases. There were also free community-based activities which took place to ascertain the levels of non-communicable diseases.  Community health workers had also helped sensitise people around diseases such as HIV and tuberculosis.   

    Around 90 per cent of land had been registered, and everyone, including women and vulnerable groups, had access to land.  After Rwanda developed its own gold refinery, businesses from other places came with gold to the refinery.  The Government agreed that drug consumption should not be criminalised, but the distribution of drugs should be criminalised.  More than 82 per cent of households had access to improved drinking water, and in Kigali this went up to 97 percent.  Numbers were lower in the western part of the country at around 75 per cent. 

    The Government was intensely investing in areas of water availability. 

    Questions by Committee Experts

    ASLAN ABASHIDZE, Committee Expert and Taskforce Member, said dropout rates in Rwanda had decreased to 5.5 per cent in primary schools and 7.5 per cent in secondary schools.  Could statistics be provided for the last five years, from 2019 to 2023, specifically on how many children were expected to enrol in primary school, and how many transitioned to lower secondary school, and then to upper secondary school?  According to the statistics provided, what percentage in the mentioned 40,000 students with disabilities who began their studies in schools and universities during the 2022/23 academic year represented the total number of children with disabilities who were expected to start schooling in that academic year? 

    What was the overall state of school infrastructure? Did schools meet the minimum requirements for lighting, drinking water, sanitation, and nutrition?  What steps was the Government taking in this regard? How were these initiatives funded? Why was disaggregated data on the Batwa group unavailable?   Could information on higher education enrolment and completion rates disaggregated by sex, rural and urban areas, and economic status be provided? 

    Was there a shortage of teachers in certain subjects? If there were challenges in this area, were there programmes to address them?  Could more details about the “We are all Rwandans” programmes be provided? How was the National Digital Inclusion Council funded?  Were private companies involved, and if so, on what terms?

    Responses by the Delegation

    The delegation said the number of teachers had increased by around 73 per cent, from around 68,000 in 2013 to around 100,000 in 2023/2024.  A teacher management system helped to determine if there were any gaps across the country.  The school dropout rate continued to decline at all levels.  There was a programme called school feeding which provided adequate and nutritious meals in schools.  The Government had started the journey of constructing schools, with a focus on accessibility by adding ramps, widening doorways, improving ventilation and lowering blackboards, to ensure they were accessible for students using wheelchairs.  Of the 4,986 schools in Rwanda, 3,392 now met accessibility standards, a significant improvement from just 765 schools in 2017.  Rwanda was committed to promoting inclusive education for children with disabilities.

    Questions by Committee Experts

    A Committee Expert asked for clarification around the official languages?  What was the language taught in primary schools?  How many universities were there in Rwanda?  Were there international students who studied in Rwanda? Did the Government provide scholarships for foreign students, particularly Africans?  Was the Swahili language widely spoken? 

    PREETI SARAN, Committee Expert and Taskforce Member, said each ethnic group in Rwanda had a rich cultural heritage.  For the sake of national unity and reconciliation, if everyone was being referred to as Rwandan, how did the State propagate the cultural richness of the population?  Rwanda had been extremely welcoming to refugees from all over the world, who brought their own specific languages and culture.  What measures had the State party taken to ensure equal cultural rights for ethnic groups who had come as aliens, refugees or asylum seekers? 

    An Expert asked if the State was collecting data with regards to young people aged between 15 to 24, who neither studied nor worked?  If this issue was not resolved, it could generate major issues. 

    PETERS SUNDAY OMOLOGBE EMUZE, Committee Vice-Chair and Country Rapporteur for Rwanda, asked what Rwandan troops were doing in the Democratic Republic of the Congo? 

    Responses by the Delegation

    The delegation said Kinyarwanda was recognised as the official language.  Rwanda had just one language.  There was no significant cultural diversity within the country, as everyone shared the same language and culture.  Traditionally, the ethnic groups had been defined based on occupation and turning them into an ethnicity was introduced by the colonialists.  It had been entrenched in identity cards for Tutsis, Hutus and Twas.  This negated the fact that people could have moved from one group to another.   There were no significant differences in culture between these groups.  French was an official language in Rwanda, due to colonisation by Belgium.  However, the majority of instruction was in English.   

    As of 2025, there were 19 universities in Rwanda, comprised of three public universities and 16 private institutions.  Schools such as the Carnegie Melon University from the United States taught courses, and specific scholarships were offered to Africans.  Scholarships were also offered to people fleeing their countries due to dangers, such as women from Afghanistan and people from Sudan.  Education could solve a lot of issues, including criminality and unemployed youth. 

    Rwanda was doing its best to attain the highest standard of economic, social and cultural rights, and would take any opportunities to learn from other countries in this regard. 

    Swahili was now an official language, recognised in the Constitution as a Lingua Franca.  It was widely spoken and taught in schools. 

    Rwanda had received a number of people who faced difficulties in their own countries.  Diversity days were organised at schools, encouraging refugees and asylum seekers to share their culture. 

    Closing Remarks

    PETERS SUNDAY OMOLOGBE EMUZE, Vice-Chair and Country Rapporteur for Rwanda, thanked the Rwandan delegation for attending the dialogue, noting the high calibre of the delegation.  The Committee wished the delegation a safe journey home. 

    EMMANUEL UGIRASHEBUJA, Minister of Justice and Attorney General of Rwanda and head of the delegation, expressed appreciation for the constructive dialogue with the Committee.  The State had learnt many valuable lessons and looked forward to receiving the Committee’s recommendations.  Rwanda’s achievements in access to health, education, and employment demonstrated the Government’s commitment to sustainable development. The country had a lot of challenges, including addressing inequalities, mitigating the effects of the global crisis, and ensuring policies translated into tangible improvements for the lives of the most vulnerable.  Rwanda was committed to resolving these challenges and to implementing the Committee’s recommendations.  Mr. Ugirashebuja extended an open invitation to the Committee to visit Rwanda in the future. 

    __________

    Produced by the United Nations Information Service in Geneva for use of the media; 
    not an official record. English and French versions of our releases are different as they are the product of two separate coverage teams that work independently.

     

    CESCR25.005E

    MIL OSI United Nations News –

    February 19, 2025
  • MIL-OSI United Kingdom: The United Kingdom remains deeply committed to the United Nations: UK statement at the UN Security Council

    Source: United Kingdom – Executive Government & Departments

    Statement by Ambassador Barbara Woodward, UK Permanent Representative to the UN, at the UN Security Council meeting on practising multilateralism, reforming and improving global governance.

    The United Kingdom remains deeply committed to the United Nations.  

    But 80 years since its creation, with more countries engaged in conflict than ever before, we are falling short of its founding mission to save succeeding generations from the scourge of war.

    And despite progress on health and education, significant global challenges remain. 

    The climate crisis is accelerating and the Sustainable Development Goals are off-track.

    Why so? There is more to this than the often-mentioned liquidity crisis.  

    In 80 years, UN membership has increased from 51 to 193 Member States, but the UN and its institutions are not fully representative of all its members.  

    We now live in a multipolar world, not a bipolar or unipolar one, whose challenges, climate, pandemics and cyber security are more transnational than national.

    As the Secretary-General reminded us and so many speakers today have reiterated, the Pact of the Future demonstrated a clear desire and a clear commitment to reinvigorate the multilateral system, including through reforming the UN and the international financial system.  

    Together, we need to redouble our efforts and find new ways to address emerging challenges.

    2025, the UN’s 80th anniversary and a year of key summits, is the first step on this path.  

    Next month we have the Commission on the Status of Women and the Beijing +30 meeting; in June we have the UN Oceans Conference; in July FFD4.  And later in the year the UN Social Summit and COP30, back in Brazil.  

    Together, these summits seek to address our shared concerns.  

    Their success is critical for progress and the UN’s reputation as our multilateral home.

    Second, we need to use the UN more effectively to deliver international peace and security.  

    Such progress must go hand in hand with upholding human rights.

    This starts first and foremost with the defence of the UN Charter as colleagues have references.  

    Nowhere is that more true today than in Ukraine, whose sovereignty and territorial integrity is under threat from Russian aggression.

    We must work to ensure that all UN tools, including its good offices, are used to deliver and advance peace.  

    For example, Personal Envoy Lamamra has a crucial platform to bring together the warring parties in Sudan.  

    We encourage reinvigorated momentum for mediation efforts, as well as a renewed focus on prevention to reduce crises before they happen.  

    This year’s Peacebuilding Architecture Review is an important opportunity in this regard.

    We also need to refresh our peacekeeping approach to ensure missions are fit for purpose and defend UN peacekeepers wherever they serve.  

    Attacks against them are unacceptable.  

    We honour, in particular today, MONUSCO peacekeepers who have fallen in defence of civilians in the DRC.

    Finally, in the face of growing global crises, from Sudan to Myanmar, we need to support the UN’s development and humanitarian programmes, across its agencies.  

    In Gaza, UNRWA, alongside the WFP and UNICEF, provides over 50% of all food aid.  

    We commend OCHA’s tireless efforts to reach those in need. 

    Humanitarian access and the protection of aid workers are integral to their successful delivery.

    In conclusion, President, colleagues, the Council is often characterised as an ineffective geopolitical theatre. 

    While reform of its membership is needed and the UK supports that, this body has the tools to implement its peace and security mandate.  

    We now need to strengthen our collective will to use them more effectively and, as the Secretary-General has said, in our 80th year, work to build the more peaceful, just and prosperous world that we know is within reach.

    Updates to this page

    Published 18 February 2025

    MIL OSI United Kingdom –

    February 19, 2025
  • MIL-OSI Global: Minimum alcohol pricing: what we found in Wales after five years

    Source: The Conversation – UK – By Katy Holloway, Professor of Criminology, University of South Wales

    Almost five years ago, a new law came into force in Wales making it illegal to sell alcohol for less than 50p per unit.

    Since its introduction, we have been evaluating the effects of minimum alcohol pricing and our findings have recently been published. These will help Welsh Government ministers decide on the future of the policy beyond its six-year trial period.

    The price of many alcoholic drinks in Welsh shops increased in March 2020. Most noticeably, large three litre bottles of strong white cider (containing 22 units of alcohol) rose from less than £5 to £11.

    The price of some beers, wines and spirits also increased, though to a lesser extent. In pubs, clubs and restaurants, the introduction of minimum pricing for alcohol made little difference, as prices were already well above the 50p per unit threshold.

    The main goal of the Public Health (Minimum Price for Alcohol) (Wales) Act 2018 is to reduce alcohol-related harm and protect the health of those regularly drinking more than the recommended 14 units per week.

    Contrary to popular belief, minimum pricing for alcohol is not a tax. This means that any extra money from higher prices goes to the retailers and producers, not to the Welsh government.

    While many people enjoy drinking alcohol without any problem, some patterns of alcohol use are associated with significant physical, mental and social harms. It costs UK society more than £27 billion a year through a combination of health, crime, workplace and social welfare costs.

    Research has shown that making alcohol less affordable can reduce consumption and hence related harms. The World Health Organization considers minimum pricing one of its “best buys” for tackling harmful alcohol use.

    While minimum alcohol pricing is in place in several countries, policies differ. In 2018, Scotland became the first country to introduce a national minimum price for all types of alcohol. Two years later, Wales followed suit.

    The Republic of Ireland introduced minimum pricing in January 2022, while Northern Ireland has been engaged in consultation on the policy for several years. There are no plans for the introduction of minimum pricing for alcohol in England.

    The policy was introduced in Wales primarily to protect hazardous and harmful drinkers, who tend to consume more low-cost, high-strength alcohol. But evaluating its effect has been complex, especially due to the COVID pandemic, which disrupted drinking habits and the availability of alcohol. Other economic factors, including the cost of living crisis, have also influenced affordability.

    What we found

    Many of the findings within the 11 reports from our Welsh evaluation have strong resonance with those elsewhere, particularly those of the final Scottish evaluation.

    Drawing from our research, we have five important findings. First, implementation in Wales has been smooth. Retailers have largely complied with the law, and enforcement has been effective.

    Second, certain cheap alcohol products have disappeared. Large bottles of strong cider, for example, are now rare. There have also been shifts in promotions and product availability.

    Third, there are indications that overall alcohol consumption in Wales has declined. While it is difficult to measure directly, purchasing data suggests a reduction.

    Fourth, concerns about unintended consequences have not materialised significantly. Predictions of a rise in home brewing, substance switching, shoplifting and cross-border purchasing have not been widely observed. While some people living near the border have bought alcohol in England, this appears to be opportunistic rather than nationwide.

    Finally, some drinkers have changed their purchasing habits. A minority have switched from cider to wine or spirits as price differences narrowed. Others, particularly those on low incomes, experienced further struggles in financially maintaining their drinking habits.

    Our recommendations

    Minimum pricing for alcohol is well supported by evidence. It is not without its critics, especially those citing continued trends in actual numbers of alcohol-related deaths. Its implementation in Wales has noticeable effects, most of which are positive.

    Based on our findings, we recommend that the Welsh Government retains minimum alcohol pricing. But we also recognise the need for some adjustments.




    Read more:
    Alcohol prescribing for severe withdrawal – what the research shows


    The 50p per unit price, set over a decade ago, should be reviewed. Our evidence suggests an increase in price is needed to maintain the policy’s effectiveness. We believe the policy needs to be accompanied by well-funded treatment and support services for people experiencing alcohol-related difficulties.

    Policymakers must also acknowledge the disproportionate effect of minimum alcohol pricing on those with the lowest incomes. But this should not be a reason to abandon it. We do not advocate for making unhealthy foods cheaper to tackle food poverty. The same principle applies to alcohol policy.

    Minimum alcohol pricing targets affordability rather than addressing all aspects of alcohol harm. It is not a silver bullet, and so should only be one component of comprehensive strategy delivery. If combined with other policy measures and social support, it has the potential to significantly contribute to reductions in alcohol-related harm in Wales.

    Katy Holloway currently receives funding from Health Care Research Wales and Welsh Government. She has previously received funding from a wide range of organisations including NIHR, Home Office, and Ministry of Justice.

    Wulf Livingston receives funding from Welsh and Scottish Governments, World Health Organisation, National Institute for Health Research, Health Boards, alcohol and drug commissioning partnerships and third sector charities. He has previously recieved funding from many of the aforementioned, and in addition ERSC, Local Authorities, Pocklington Trust, Alcohol research UK and Welsh Universities WIN Fund.

    – ref. Minimum alcohol pricing: what we found in Wales after five years – https://theconversation.com/minimum-alcohol-pricing-what-we-found-in-wales-after-five-years-248189

    MIL OSI – Global Reports –

    February 19, 2025
  • MIL-OSI Economics: Microsoft announces latest investment in Europe, $700M for computing capacity in Poland

    Source: Microsoft

    Headline: Microsoft announces latest investment in Europe, $700M for computing capacity in Poland

    This morning, I stood in Warsaw with Poland’s Prime Minister, Donald Tusk, and announced Microsoft’s latest cloud and AI infrastructure investment in Europe. Building on our initial billion-dollar investment to launch a Polish cloud region in 2023, I announced that Microsoft will spend another $700 million by the middle of next year to expand our computing capacity in the country. And we will deepen our work with Polish National Defense to strengthen Poland’s cybersecurity, including by working together on the development of AI competencies and emerging digital technologies, including new AI and quantum breakthroughs. 

    This marks the latest critical step for Microsoft’s business, economic, and political relationships in Poland – and in Europe as a whole.  

    During the past 16 months, we have announced more than $20 billion in AI and cloud infrastructure investments that represent an important part of our datacenter expansion across 15 European countries. Today’s investment in Poland builds on the integrated supply chain we are building with manufacturers across the EU. It calls on suppliers that are manufacturing critical components not only in Poland but in Italy, France, Germany, Finland, Ireland, and the United Kingdom. It also includes components manufactured and exported from Indiana in the United States. It’s the type of investment that creates jobs and fosters economic growth throughout Europe and across the Atlantic. 

    Promoting Trans-Atlantic Investment, Trade, and Economic Growth 

    The American technology sector is creating world-leading AI technology and is focused on being a trusted “partner of choice” around the world. And European policy leaders are focused on mobilizing more capital and increasing productivity by “closing the innovation gap.” Even in a time of fragmenting geopolitics, today’s announcement illustrates that these two technology ambitions are more aligned than divergent.  

    In multiple ways, our investment in Poland puts both these goals into practice. It demonstrates how vastly the technology sector has changed since I first joined Microsoft as an employee in Paris more than 31 years ago. While we develop and provide world-leading technology products and services globally, we now support these with enormous national investments in infrastructure and large numbers of local employees. More than ever, technology requires coordinated investments that connect countries and span oceans. 

    Sustained Technology Support During a Decade of Crises 

    Equally important, technology has become a lynchpin for national needs in times of crisis. European Commission President Ursula von der Leyen has aptly put recent history in perspective. As she highlighted, Europe faces a competitiveness challenge that comes as the third crisis of the 2020s, after the pandemic and the war in Ukraine.  

    It’s worth reflecting on the critical role of technology in helping to support the responses needed for each of these crises. 

    Five years ago this month, the first pandemic in a century literally started to shut doors around the world. At Microsoft, our employees and partners used new video and productivity technology like Teams to keep the economy moving forward in every corner of Europe. In just days, businesses, schools, universities, hospitals, and governments sustain their operations by moving online.  

    Two years later, the Russian military invaded Ukraine. At Microsoft, we helped move Ukraine’s critical data and technology services to our datacenters across Europe, ensuring their continued operation outside the range of cruise missile and air attacks. And like several other technology companies, we immediately helped Ukraine’s officials and citizens defend their nation from Russian cyberattacks. As a company, we provided more than $250 million of free technology and financial assistance. And we have sustained this substantial support to this day. 

    As Europe now launches a new “competitiveness compass,” technology will again play an indispensable role. Especially as working-age populations shrink and aging populations expand, economic growth and prosperity will depend more than ever on new technology. Productivity growth will require it. And the competitiveness of Europe’s many great industries and companies, large and small, will depend on their ability to hone their ongoing leadership in critical scientific domains and put their data to work. Across the continent, European institutions will need to harness the power of AI and the cloud. 

    A Strong Foundation for Europe’s AI Transition 

    AI is rapidly becoming what economists call a General Purpose Technology, or GPT. In contrast to single-purpose technologies, GPTs boost innovation and productivity across the entire economy. Throughout history, transformative GPTs like ironworking, electricity, machine tooling, computer chips, and software have not only driven economic growth but sparked new discoveries and inventions, changing the way we live and work.  

    The good news is that the foundation for Europe’s AI transition is already being laid. Industry leaders are investing tens of billions to construct state-of-the-art infrastructure to help Europe access, adopt, and innovate on the world’s most advanced cloud and AI technology. And companies like Microsoft are developing and offering innovative AI tools and vital services that are ready for use by every sector of every European economy.  

    As a company, we are developing and operating our AI infrastructure and platform services with a constant focus on Europe’s needs. This is one reason we announced our AI Access Principles in Barcelona a year ago. These eleven principles govern our operations and are designed to ensure that Microsoft’s AI infrastructure is accessible, open, and available on fair terms to the entire European economy.  

    As we’ve put these principles into practice, we’ve recognized the vital role of open-source software and AI models for European researchers, start-ups, businesses, and governments. We’ve launched the Azure AI Foundry, a platform designed to help developers build, run, and optimize AI-driven applications. The Foundry supports flexible choices and now supports more than 1,800 AI models, from OpenAI’s o3-mini to open-source models like Llama, Mistral, and others, all giving Europe the tools it needs to stay competitive in the fast-moving AI landscape. European developers can then use our Models as a Service offering to distribute their products instantly to our datacenters around the world, so customers can call on them for AI-powered applications. 

    We also recognize that technology innovation requires investments in people. That’s why we’re investing in our AI Skilling Initiative across Europe. We’re partnering with government, education, industry, and civil society to help bring AI skills to users, developers, and organizational leaders. Through our strategic partnerships, we have already helped to skill 2.9 million Europeans and are on track to engage 8 million people by the end of the year. 

    Technology Collaboration Built on Interdependence 

    We readily recognize that European leaders sometimes worry about becoming overly dependent on American technology. We appreciate that such questions are both natural and legitimate. We take them seriously and work hard to address them, including by understanding European values, supporting European needs, and adapting to European rules.  

    Along the way, we often point to a second technology dimension that too easily is overlooked. The reality is that this dependence runs both ways.  

    As a company, we’re pouring tens of billions of dollars of investment into acquiring land, constructing massive buildings, bringing additional electricity to the grid, and installing the world’s most advanced computing, networking, liquid cooling, and other technology.  

    These datacenters are not built on wheels.  

    Once constructed, these billions of dollars in infrastructure are permanent and subject to local laws, regulations, and governments. Time inevitably brings changes. It’s imperative as a company that we constantly remain focused on earning and sustaining our “license to operate” within each country. With datacenters, this starts with each local community and runs up to officials with EU-wide responsibilities. Our economic dependence on Europe runs deep. 

    As Microsoft celebrates its 50th birthday less than two months from now, we look back at more than four decades of European presence and support. As a company, we’ve seen many things change. And we ourselves have changed. We’ve put down deep roots, with employees and families in communities and countries across the continent.  

    But even amid constant change, one thing has been constant. Our support for Europe has been not only steady but steadfast.  

    MIL OSI Economics –

    February 19, 2025
  • MIL-OSI USA: A Message to UConn Faculty and Staff

    Source: US State of Connecticut

    Dear Colleagues,

    As you know, along with other senior leaders, we regularly engage with the University Senate, USG, union representatives, the Deans Council, associate deans, department heads, directors of centers and institutes, and students to talk about challenges and opportunities for our university. But we can always do more to enhance our communication efforts and ensure that everyone feels heard and valued.

    We believe that effective communication and transparency are crucial for supporting trust and sustaining positive relationships and growth at UConn and UConn Health. To that end, we would like to offer the broader UConn community more opportunities to have access to senior administrators so that faculty, students, and staff can ask questions and share their ideas on challenges and aspirational goals.

    That is especially true now. Between new and sometimes rapidly changing policies and directives from the federal government to looming potential budget difficulties here at the university to the legislative session and appropriations process that is beginning at the state capitol, we are in the midst of a fraught and complicated moment on multiple levels.

    First: Together, we are going to get through all of it. We are certainly no strangers to facing challenges. As events unfold, we will deal with them — meeting the moment, coming together as a community, and being responsive while always staying true to our values.

    We will remain optimistic about the future despite the challenges of the present because we will persevere and adhere to our mission to educate the next generation of leaders across multiple fields; create educational access and opportunity for all; conduct innovative and impactful research; and engage Connecticut’s communities in the service of improving the world around us.

    As we continue to work to navigate the issues we face, we want to make sure we share relevant information with our community but also connect with and hear from you in multiple venues, both formal and informal.

    We have used the stakeholder discussions noted above as opportunities to assess our current circumstances and focus on solutions-based paths forward. Similar discussions are happening at the school, college, and department levels through the regular cadence of unit meetings as well as through smaller in-person gatherings.

    Like many leaders, we’re not only talking to one another, but are in constant contact with colleagues at institutions around the nation, our contacts at funding agencies, state leaders, and members of our Congressional delegation.

    The mood and tone of these discussions, beyond information sharing, is steady determination. This is a marathon, not a sprint, and we are in it for the long haul. Our collective goal is to support and protect higher education across the United States – making sure that we maintain the considerable strengths of this precious national resource while innovating into the future.

    With respect to internal communication, in addition to written messages and web content, we will resume a practice that we first began during the Covid pandemic: Beginning soon, we and other senior leaders at UConn and UConn Health will hold bi-weekly check-ins over Teams with the campus community, where we will share information and answer questions that can be submitted in advance or during the meeting itself.

    We will share the date and time of the first meeting once it has been scheduled. In the meantime, please e-mail questions to which you would like answers (to the extent there are answers) to Communications@UConn.edu with the subject line: “Questions for leadership.”

    In addition, we also want to make ourselves available at the local level through smaller group discussions during academic departmental meetings. If you would like to invite us to attend a regularly scheduled meeting of your department, please e-mail President@UConn.edu with the subject line: “Invite to department meeting.”

    We also want to take this opportunity to acknowledge what is so abundantly clear: that many members of our community, including particularly vulnerable populations, are feeling everything from deep concern to outright worry. Please know that we and your university are here for you and support you. As we have said many times, we know what our values are and they are not going to change.

    We plan to send a message similar to this to our students.

    We don’t pretend to have all the answers or the perfect prescription to address each of the challenges we face, but we are going to do all we can in partnership with you to move forward.

    All the best,

    President Radenka Maric

    Provost Anne D’Alleva

    MIL OSI USA News –

    February 19, 2025
  • MIL-OSI: Eos Energy Enterprises Announces Date for Fourth Quarter and Full Year 2024 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    EDISON, N.J., Feb. 18, 2025 (GLOBE NEWSWIRE) — Eos Energy Enterprises, Inc. (NASDAQ: EOSE) (“Eos” or the “Company”), America’s leading innovator in designing, manufacturing, and providing zinc-based long duration energy storage systems sourced and manufactured in the United States, today announced it will release its fourth quarter and full year 2024 financial results after the U.S. market closes on March 4, 2025. A conference call to discuss its results will take place the following morning on March 5 at 8:30 a.m. Eastern Time.

    Eos is now partnering with Say Technologies to allow retail and institutional shareholders to submit and vote on questions ahead of the earnings call. A selection of key questions applicable to the broad investor base will be addressed live during the call, offering shareholders an opportunity to engage with Eos management.

    Starting on February 25, 2025, at 8:00 a.m. ET, registered shareholders will be able to submit questions via the Say Technologies Q&A Platform, which will remain open until 8:00 a.m. ET on March 3, 2025. For any support inquiries shareholders may email support@saytechnologies.com.

    Registration Information

    The live webcast of the earnings call will be available on the “Investor Relations” page of the Company’s website at Eos Investors or may be accessed using this link (registration link). To avoid delays, we encourage participants to join the conference call fifteen minutes ahead of the scheduled start time.

    The conference call replay will be available via webcast through Eos’ investor relations website for twelve months following the live presentation. The webcast replay will be available from approximately 11:30 a.m. ET on March 5, 2025, and can be accessed by visiting Eos Investors

    About Eos Energy Enterprises

    Eos Energy Enterprises, Inc. is accelerating the shift to American energy independence with positively ingenious solutions that transform how the world stores power. Our breakthrough Znyth™ aqueous zinc battery was designed to overcome the limitations of conventional lithium-ion technology. It is safe, scalable, efficient, sustainable, manufactured in the U.S., and the core of our innovative systems that today provides utility, industrial, and commercial customers with a proven, reliable energy storage alternative for 3 to 12-hour applications. Eos was founded in 2008 and is headquartered in Edison, New Jersey. For more information about Eos (NASDAQ: EOSE), visit eose.com.

    Forward Looking Statements

    Except for the historical information contained herein, the matters set forth in this press release are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements regarding our path to profitability and strategic outlook, statements regarding our capital needs to support project AMAZE, statements regarding the anticipated use of proceeds from the delayed draw term loan with Cerberus, and statements that refer to outlook, projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements are based on our management’s beliefs, as well as assumptions made by, and information currently available to, them. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected.

    Factors which may cause actual results to differ materially from current expectations include, but are not limited to: changes adversely affecting the business in which we are engaged; our ability to forecast trends accurately; our ability to generate cash, service indebtedness and incur additional indebtedness; our ability to achieve the operational milestones on the delayed draw term loan; our ability to raise financing in the future, including the discretionary revolving facility from Cerberus; risks associated with the credit agreement with Cerberus, including risks of default, dilution of outstanding Common Stock, consequences for failure to meet milestones and contractual lockup of shares; our customers’ ability to secure project financing; the amount of final tax credits available to our customers or to Eos pursuant to the Inflation Reduction Act; uncertainties around our ability to meet the applicable conditions precedent to funding under the DOE loan; our ability to continue to develop efficient manufacturing processes to scale and to forecast related costs and efficiencies accurately; fluctuations in our revenue and operating results; competition from existing or new competitors; our ability to convert firm order backlog and pipeline to revenue; risks associated with security breaches in our information technology systems; risks related to legal proceedings or claims; risks associated with evolving energy policies in the United States and other countries and the potential costs of regulatory compliance; risks associated with changes to the U.S. trade environment; risks resulting from the impact of global pandemics, including the novel coronavirus, Covid-19; our ability to maintain the listing of our shares of common stock on NASDAQ; our ability to grow our business and manage growth profitably, maintain relationships with customers and suppliers and retain our management and key employees; risks related to the adverse changes in general economic conditions, including inflationary pressures and increased interest rates; risk from supply chain disruptions and other impacts of geopolitical conflict; changes in applicable laws or regulations; the possibility that Eos may be adversely affected by other economic, business, and/or competitive factors; other factors beyond our control; risks related to adverse changes in general economic conditions; and other risks and uncertainties.

    The forward-looking statements contained in this press release are also subject to additional risks, uncertainties, and factors, including those more fully described in the Company’s most recent filings with the Securities and Exchange Commission, including the Company’s most recent Annual Report on Form 10-K and subsequent reports on Forms 10-Q and 8-K. Further information on potential risks that could affect actual results will be included in the subsequent periodic and current reports and other filings that the Company makes with the Securities and Exchange Commission from time to time. Moreover, the Company operates in a very competitive and rapidly changing environment, and new risks and uncertainties may emerge that could have an impact on the forward-looking statements contained in this press release.

    Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and, except as required by law, the Company assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.

    The MIL Network –

    February 19, 2025
  • MIL-OSI Global: Why community pharmacies are closing – and what to do if your neighborhood location shutters

    Source: The Conversation – USA – By Lucas A. Berenbrok, Associate Professor of Pharmacy and Therapeutics, University of Pittsburgh

    Neighborhood pharmacies are rapidly shuttering.

    Not long ago, Walgreens, one of the nation’s biggest pharmacy chains, announced plans to close 1,200 stores over the next three years. That’s part of a larger trend that has seen nearly 7,000 pharmacy locations close since 2019, with more expected in the coming years.

    Many community pharmacies are struggling to stay open due to an overburdened workforce, shrinking reimbursement rates for prescription drugs and limited opportunities to bill insurers for services beyond dispensing medications.

    As trained pharmacists who advocate for and take care of patients in community settings, we’ve witnessed this decline firsthand. The loss of local pharmacies threatens individual and community access to medications, pharmacist expertise and essential public health resources.

    The changing role of pharmacies

    Community pharmacies – which include independently owned, corporate-chain and other retail pharmacies in neighborhood settings – have changed a lot over the past decades. What once were simple medication pickup points have evolved into hubs for health and wellness. Beyond dispensing prescriptions, pharmacists today provide vaccinations, testing and treatment for infectious diseases, access to hormonal birth control and other clinical services they’re empowered to provide by federal and state laws.

    Given their importance, then, why have so many community pharmacies been closing?

    There are many reasons, but the most important is reduced reimbursement for prescription drugs. Most community pharmacies operate under a business model centered on dispensing medications that relies on insurer reimbursements and cash payments from patients. Minor revenue comes from front-end sales of over-the-counter products and other items.

    However, pharmacy benefit managers – companies that manage prescription drug benefits for insurers and employers – have aggressively cut reimbursement rates in an effort to lower drug costs in recent years. As a result, pharmacists often have to dispense prescription drugs at very low margins or even at a loss. In some cases, pharmacists are forced to transfer prescriptions to other pharmacies willing to absorb the financial hit. Other times, pharmacists choose not to stock these drugs at all.

    And it’s not just mom-and-pop operations feeling the pinch. Over the past four years, the three largest pharmacy chains have announced plans to close hundreds of stores nationwide. CVS kicked off the trend in 2021 by announcing plans to close 900 pharmacy locations. In late 2023, Rite Aid said that thousands of its stores would be at risk for closure due to bankruptcy. And late in 2024, Walgreens announced its plans to close 1,200 stores over the next three years.

    To make matters worse, pharmacists, like many other health care providers, have been facing burnout due to high stress and the lasting effects of the COVID-19 pandemic. At the same time, pharmacy school enrollment has declined, worsening the workforce shortage just as an impending shortfall of primary care physicians looms.

    Why pharmacy accessibility matters

    The increasing closure of community pharmacies has far-reaching consequences for millions of Americans. That’s because neighborhood pharmacies are one of the most accessible health care locations in the country, with an estimated 90% of Americans living within 5 miles of one.

    However, research shows that “pharmacy deserts” are more common in marginalized communities, where people need accessible health care the most. For example, people who live in pharmacy deserts are also more likely to have a disability that makes it hard or impossible to walk. Many of these areas are also classified as medically underserved areas or health professional shortage areas. As pharmacy closures accelerate, America’s health disparities could get even worse.

    So if your neighborhood pharmacy closes, what should you do?

    While convenience and location matter, you might want to consider other factors that can help you meet your health care needs. For example, some pharmacies have staff who speak your native language, independent pharmacy business owners may be active in your community, and many locations offer over-the-counter products like hormonal contraception, the overdose-reversal drug naloxone and hearing aids.

    You may also consider locations – especially corporate-owned pharmacies – that also offer urgent care or primary care services. In addition, most pharmacies offer vaccinations, and some offer test-and-treat services for infectious diseases, diabetes education and help with quitting smoking.

    What to ask if your pharmacy closes

    If your preferred pharmacy closes and you need to find another one, keep the following questions in mind:

    • What will happen to your old prescriptions? When a pharmacy closes, another pharmacy may buy its prescriptions. Ask your pharmacist if your prescriptions will be automatically transferred to a nearby pharmacy, and when this will occur.

    • What’s the staffing situation like at other pharmacies? This is an important factor in choosing a new pharmacy. What are the wait times? Can the team accommodate special situations like emergency refills or early refills before vacations? Does the pharmacist have a relationship with your primary care physician and your other prescribers?

    • Which pharmacies accept your insurance? A simple call to your insurer can help you understand where your prescriptions are covered at the lowest cost. And if you take a medication that’s not covered by insurance, or if you’re uninsured, you should ask if the pharmacy can help you by offering member pricing or manufacturer coupons and discounts.

    • What are your accessibility needs? Pharmacies often offer services to make your care more accessible and convenient. These may include medication packaging services, drive-thru windows and home delivery. And if you’re considering switching to a mail-order pharmacy, you should ask if it has a pharmacist to answer questions by phone or during telehealth visits.

    Remember that it’s best to have all your prescriptions filled at the same pharmacy chain or location so that your pharmacist can perform a safety check with your complete medication list. Drug interactions can be dangerous.

    Community pharmacies have been staples of neighborhoods for more than a century. Unfortunately, current trends in pharmacy closures pose real threats to public health. We hope lawmakers address the underlying systemic issues so more Americans don’t lose access to their medications, health services and pharmacists.

    Lucas A. Berenbrok is part owner of the consulting company, Embarx, LLC. He receives funding from the American Pharmacists Association.

    Michael Murphy consults to the American Pharmacists Association.

    Sophia Herbert has received funding from the Community Pharmacy Foundation.

    – ref. Why community pharmacies are closing – and what to do if your neighborhood location shutters – https://theconversation.com/why-community-pharmacies-are-closing-and-what-to-do-if-your-neighborhood-location-shutters-217775

    MIL OSI – Global Reports –

    February 19, 2025
  • MIL-OSI: Franklin Electric Reports Fourth Quarter 2024 and Full Year 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    Fourth Quarter 2024 Highlights

    • Consolidated net sales of $485.7 million, an increase of 3% to the prior year
    • Energy Systems and Distribution net sales increased 5% and 6%, respectively, while Water Systems net sales were flat
    • Operating income was $43.0 million with operating margin of 8.9%
    • GAAP fully diluted earnings per share (EPS) was $0.72

    Full Year 2024 Highlights

    • Consolidated net sales of $2.0 billion, a decrease of 2% to the prior year
    • Distribution net sales increased 2%, while Water Systems and Energy Systems net sales decreased 2% and 8%, respectively
    • Operating income was $243.6 million with operating margin of 12.1%
    • GAAP fully diluted earnings per share (EPS) was $3.86
    • Cash flows from operating activities were $261.4 million

    FORT WAYNE, Ind., Feb. 18, 2025 (GLOBE NEWSWIRE) — Franklin Electric Co., Inc. today announced its fourth quarter and full year financial results for fiscal year 2024.

    Fourth quarter 2024 net sales were $485.7 million, compared to fourth quarter 2023 net sales of $473.0 million. Fourth quarter 2024 operating income was $43.0 million, compared to fourth quarter 2023 operating income of $50.8 million. Fourth quarter 2024 EPS was $0.72, versus EPS in the fourth quarter 2023 of $0.82.

    Full year 2024 net sales were $2.0 billion, compared to full year 2023 net sales of $2.1 billion. Full year 2024 operating income was $243.6 million, compared to full year 2023 operating income of $262.4 million. Full year 2024 EPS was $3.86, versus EPS in the full year 2023 of $4.11.

    “The fourth quarter marked a solid finish to a challenging year. Our results were driven by strong performance in our newly renamed Energy Systems segment. While we have worked through the elevated post-COVID backlogs at this time, underlying demand remains healthy, and we continue to execute on productivity initiatives as we align our businesses with the more normalized environment,” commented Joe Ruzynski, Franklin Electric’s CEO.

    “Our resiliency is supported by the breadth of our global portfolio, which has proven to be a strategic asset as we closed out a year shaped by macroeconomic pressures. Order trends have improved, and with the support of a very healthy balance sheet, we are well-positioned to capitalize on opportunities in the year ahead. In 2025, our focus turns to driving revenue growth and margin expansion as we accelerate innovation and growth,” concluded Mr. Ruzynski.

    Segment Summaries

    Water Systems net sales were $279.6 million in the fourth quarter, flat compared to the fourth quarter 2023. Results were driven by higher sales of groundwater products, water treatment products and all other surface products. These sales increases were offset by lower sales of large dewatering pumps, which had a record fourth quarter last year. Water Systems operating income in the fourth quarter 2024 was $35.6 million. Fourth quarter 2023 Water Systems operating income was $44.1 million.

    Distribution net sales were $157.2 million, an increase of $9.2 million or 6 percent compared to the fourth quarter 2023. Sales increases were driven by higher volumes and the incremental impact from a recent acquisition. The Distribution segment operating income in the fourth quarter 2024 was $0.5 million. Fourth quarter 2023 Distribution operating income was $1.0 million.

    Energy Systems net sales were $68.8 million in the fourth quarter 2024, an increase of $3.1 million or 5 percent compared to the fourth quarter 2023. Sales increases were driven by higher volumes and price realization. Energy Systems operating income in the fourth quarter 2024 was a record for any fourth quarter at $24.7 million. Fourth quarter 2023 Energy Systems operating income was $19.4 million. The Company has changed the name of the Fueling Systems segment to Energy Systems to reflect its diverse portfolio and growth strategy, as well as to better reflect the markets and customers served by the segment.

    Cash Flow

    The Company ended 2024 with a cash balance of $220.5 million, an increase of $135.5 million compared to the end of 2023. Net cash flows from operating activities for 2024 were $261.4 million versus $315.7 million in the same period in 2023. Cash flow in 2023 benefitted from actions the Company took to improve working capital including inventory reductions as its supply chain resiliency and lead times improved during the year.

    2024 Guidance

    The Company expects its full year 2025 sales including the impact of its recently announced acquisitions to be in the range of $2.09 billion to $2.15 billion and full year 2025 EPS to be in the range of $4.05 to $4.25.

    Earnings Conference Call

    A conference call to review earnings and other developments in the business will commence at 9:00 am ET. The fourth quarter 2024 earnings call will be available via a live webcast. The webcast will be available in a listen only mode by going to:

    https://edge.media-server.com/mmc/p/9jnstij5

    For those interested in participating in the question-and-answer portion of the call, please register for the call at the link below.

    https://register.vevent.com/register/BI4b232e4ceea6435ba8f046e92e18e563

    All registrants will receive dial-in information and a PIN allowing them to access the live call. It is recommended that you join 10 minutes prior to the event start (although you may register and dial in at any time during the call).

    A replay of the conference call will be available from Tuesday, February 18, 2025, through 9:00 am ET on Tuesday, February 25, 2025, by visiting the listen-only webcast link above.

    Forward Looking Statements

    “Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein, including those relating to market conditions or the Company’s financial results, costs, expenses or expense reductions, profit margins, inventory levels, foreign currency translation rates, liquidity expectations, business goals and sales growth, involve risks and uncertainties, including but not limited to, risks and uncertainties with respect to general economic and currency conditions, various conditions specific to the Company’s business and industry, weather conditions, new housing starts, market demand, competitive factors, changes in distribution channels, supply constraints, effect of price increases,  raw material costs, technology factors, integration of acquisitions, litigation, government and regulatory actions, the Company’s accounting policies, future trends, epidemics and pandemics, and other risks which are detailed in the Company’s Securities and Exchange Commission filings, included in Item 1A of Part I of the Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2023, Exhibit 99.1 attached thereto and in Item 1A of Part II of the Company’s Quarterly Reports on Form 10-Q. These risks and uncertainties may cause actual results to differ materially from those indicated by the forward-looking statements. All forward-looking statements made herein are based on information currently available, and the Company assumes no obligation to update any forward-looking statements.

    About Franklin Electric

    Franklin Electric is a global leader in the production and marketing of systems and components for the movement of water and energy. Recognized as a technical leader in its products and services, Franklin Electric serves customers around the world in residential, commercial, agricultural, industrial, municipal, and fueling applications. Franklin Electric is proud to be named in Newsweek’s lists of America’s Most Responsible Companies and Most Trustworthy Companies for 2024 and America’s Climate Leaders 2024 by USA Today.

    Franklin Electric Contact:

    Jeffery L. Taylor
    Franklin Electric Co., Inc.
    InvestorRelations@fele.com

     
    FRANKLIN ELECTRIC CO., INC. AND CONSOLIDATED SUBSIDIARIES
    CONDENSED CONSOLIDATED STATEMENTS OF INCOME
    (Unaudited)
                   
    (In thousands, except per share amounts)              
                   
      Fourth Quarter Ended   Fiscal Year End
      December 31,   December 31,   December 31,   December 31,
      2024   2023   2024   2023
                   
    Net sales $ 485,745     $ 472,970     $ 2,021,341     $ 2,065,133  
                   
    Cost of sales   321,505       312,961       1,304,061       1,368,125  
                   
    Gross profit   164,240       160,009       717,280       697,008  
                   
    Selling, general, and administrative expenses   117,846       108,825       470,136       433,476  
                   
    Restructuring expense   3,360       356       3,499       1,091  
                   
    Operating income   43,034       50,828       243,645       262,441  
                   
    Interest expense   (1,339 )     (1,481 )     (6,319 )     (11,790 )
    Other income, net   630       1,831       1,339       3,696  
    Foreign exchange expense, net   (1,590 )     (4,026 )     (6,818 )     (12,124 )
                   
    Income before income taxes   40,735       47,152       231,847       242,223  
                   
    Income tax expense   6,443       8,322       50,238       47,489  
                   
    Net income $ 34,292     $ 38,830     $ 181,609     $ 194,734  
                   
    Less: Net income attributable to noncontrolling interests   (637 )     (281 )     (1,300 )     (1,462 )
                   
    Net income attributable to Franklin Electric Co., Inc. $ 33,655     $ 38,549     $ 180,309     $ 193,272  
                   
    Income per share:              
    Basic $ 0.73     $ 0.83     $ 3.92     $ 4.17  
    Diluted $ 0.72     $ 0.82     $ 3.86     $ 4.11  
                   
    FRANKLIN ELECTRIC CO., INC. AND CONSOLIDATED SUBSIDIARIES
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (Unaudited)
           
    (In thousands)      
           
      December 31,   December 31,
      2024   2023
    ASSETS      
           
    Cash and cash equivalents $ 220,540     $ 84,963  
    Receivables (net)   226,826       222,418  
    Inventories   483,875       508,696  
    Other current assets   32,950       37,718  
    Total current assets   964,191       853,795  
           
    Property, plant, and equipment, net   223,566       229,739  
    Lease right-of-use Assets, net   62,637       57,014  
    Goodwill and other assets   570,212       587,574  
    Total assets $ 1,820,606     $ 1,728,122  
           
           
    LIABILITIES AND EQUITY      
           
    Accounts payable $ 157,046     $ 152,419  
    Accrued expenses and other current liabilities   139,989       104,949  
    Current lease liability   18,878       17,316  
    Current maturities of long-term debt and short-term borrowings   117,814       12,355  
    Total current liabilities   433,727       287,039  
           
    Long-term debt   11,622       88,056  
    Long-term lease liability   43,304       38,549  
    Income taxes payable non-current   –       4,837  
    Deferred income taxes   10,193       29,461  
    Employee benefit plans   29,808       35,973  
    Other long-term liabilities   22,118       33,914  
     
    Redeemable noncontrolling interest   1,224       1,145  
           
    Total equity   1,268,610       1,209,148  
    Total liabilities and equity $ 1,820,606     $ 1,728,122  
           
    FRANKLIN ELECTRIC CO., INC. AND CONSOLIDATED SUBSIDIARIES
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (Unaudited)
    (In thousands)      
           
      2024   2023
    Cash flows from operating activities:      
    Net income $ 181,609     $ 194,734  
    Adjustments to reconcile net income to net cash flows from operating activities:      
    Depreciation and amortization   56,073       52,260  
    Non-cash lease expense   21,438       18,852  
    Share-based compensation   12,061       10,133  
    Other   (13,327 )     10,259  
    Changes in assets and liabilities:      
    Receivables   (17,045 )     19,150  
    Inventory   10,889       48,176  
    Accounts payable and accrued expenses   15,285       (23,085 )
    Operating leases   (21,129 )     (18,874 )
    Income taxes-U.S. Tax Cuts and Jobs Act   (3,870 )     (2,902 )
    Other   19,369       7,007  
           
    Net cash flows from operating activities   261,353       315,710  
           
    Cash flows from investing activities:      
    Additions to property, plant, and equipment   (41,682 )     (41,415 )
    Proceeds from sale of property, plant, and equipment   1,182       1,494  
    Acquisitions and investments   (5,201 )     (34,831 )
    Other investing activities   73       463  
           
    Net cash flows from investing activities   (45,628 )     (74,289 )
           
    Cash flows from financing activities:      
    Net change in debt   29,235       (115,529 )
    Proceeds from issuance of common stock   7,204       9,193  
    Purchases of common stock   (61,041 )     (43,332 )
    Dividends paid   (46,876 )     (41,723 )
    Deferred payments for acquisitions   (2,591 )     (802 )
           
    Net cash flows from financing activities   (74,069 )     (192,193 )
           
    Effect of exchange rate changes on cash   (6,079 )     (10,055 )
    Net change in cash and cash equivalents   135,577       39,173  
    Cash and cash equivalents at beginning of period   84,963       45,790  
    Cash and cash equivalents at end of period $ 220,540     $ 84,963  
           

    Key Performance Indicators: Net Sales Summary

      Net Sales For the Fourth Quarter
      United
    States
    Latin Europe,
    Middle
    Asia Total        
    (in millions) & Canada America East & Africa Pacific Water Energy** Distribution Other/Elims Consolidated
                       
    Q4 2023 $161.2   $46.6   $45.5   $26.3   $279.6   $65.7   $148.0   ($20.3 ) $473.0  
    Q4 2024 $158.5   $44.3   $49.7   $27.1   $279.6   $68.8   $157.2   ($19.9 ) $485.7  
    Change ($2.7 ) ($2.3 ) $4.2   $0.8   $0.0   $3.1   $9.2   $0.4   $12.7  
    % Change   -2 %   -5 %   9 %   3 %   0 %   5 %   6 %     3 %
                       
    Foreign currency translation, net* ($0.4 ) ($5.5 ) ($0.8 ) ($0.8 ) ($7.5 ) $0.0   $0.0     ($7.5 )
    % Change   0 %   -12 %   -2 %   -3 %   -3 %   0 %   0 %     2 %
                       
    Acquisitions $3.1   $0.0   $0.0   $0.0   $3.1   $0.0   $4.0     $7.1  
    % Change   2 %   0 %   0 %   0 %   1 %   0 %   3 %     2 %
                       
    Volume/Price ($5.4 ) $3.2   $5.0   $1.6   $4.4   $3.1   $5.2   $0.4   $13.1  
    % Change   -3 %   7 %   11 %   6 %   2 %   5 %   4 %   -2 %   3 %
                       
      Net Sales For the Full Year
      United
    States
    Latin Europe,
    Middle
    Asia Total        
    (in millions) & Canada America East & Africa Pacific Water Energy** Distribution Other/Elims Consolidated
                       
    FY 2023 $744.4   $174.2   $198.3   $86.8   $1,203.7   $296.5   $673.3   ($108.4 ) $2,065.1  
    FY 2024 $708.5   $170.9   $211.4   $93.2   $1,184.0   $273.7   $685.5   ($121.9 ) $2,021.3  
    Change ($35.9 ) ($3.3 ) $13.1   $6.4   ($19.7 ) ($22.8 ) $12.2   ($13.5 ) ($43.8 )
    % Change   -5 %   -2 %   7 %   7 %   -2 %   -8 %   2 %     -2 %
                       
    Foreign currency translation, net* ($0.9 ) ($9.7 ) ($6.3 ) ($2.4 ) ($19.3 ) $0.0   $0.0     ($19.3 )
    % Change   0 %   -6 %   -3 %   -3 %   -2 %   0 %   0 %     -1 %
                       
    Acquisitions $17.6   $0.0   $0.0   $0.0   $17.6   $0.0   $17.1     $34.7  
    % Change   2 %   0 %   0 %   0 %   1 %   0 %   3 %     2 %
                       
    Volume/Price ($52.6 ) $6.4   $19.4   $8.8   ($18.0 ) ($22.8 ) ($4.9 ) ($13.5 ) ($59.2 )
    % Change   -7 %   4 %   10 %   10 %   -1 %   -8 %   -1 %   12 %   -3 %
                       

    *The Company has presented local currency price increases used to offset currency devaluation in the Argentina and Turkey hyperinflationary economies within the foreign currency translation, net row above.
    ** Recognizing the Company’s diverse portfolio and growth strategy, it renamed its Fueling Systems segment to Energy Systems to better reflect the markets and customers served by this business.

    Key Performance Indicators: Operating Income and Margin Summary

    Operating Income and Margins          
    (in millions) For the Fourth Quarter 2024
      Water Energy Distribution Other/Elims Consolidated
    Operating Income / (Loss) $ 35.6   $ 24.7   $ 0.5   $ (17.8 ) $ 43.0  
    % Operating Income To Net Sales   12.7 %   35.9 %   0.3 %     8.9 %
               
    Operating Income and Margins          
    (in millions) For the Fourth Quarter 2023
      Water Energy Distribution Other/Elims Consolidated
    Operating Income / (Loss) $ 44.1   $ 19.4   $ 1.0   $ (13.7 ) $ 50.8  
    % Operating Income To Net Sales   15.8 %   29.5 %   0.7 %     10.7 %
               
    Operating Income and Margins          
    (in millions) For the Full Year of 2024
      Water Energy Distribution Other/Elims Consolidated
    Operating Income / (Loss) $ 197.9   $ 93.6   $ 24.3   $ (72.2 ) $ 243.6  
    % Operating Income To Net Sales   16.7 %   34.2 %   3.5 %     12.1 %
               
    Operating Income and Margins          
    (in millions) For the Full Year of 2023
      Water Energy Distribution Other/Elims Consolidated
    Operating Income / (Loss) $ 196.6   $ 92.7   $ 34.3   $ (61.2 ) $ 262.4  
    % Operating Income To Net Sales   16.3 %   31.3 %   5.1 %     12.7 %
               

    The MIL Network –

    February 19, 2025
  • MIL-OSI: Lantronix Expands Latin American Market Reach Through Strategic Partnership With Ion LATAM

    Source: GlobeNewswire (MIL-OSI)

    IRVINE, Calif., Feb. 18, 2025 (GLOBE NEWSWIRE) — Lantronix Inc. (NASDAQ: LTRX), a global leader of compute and connectivity for IoT solutions enabling AI Edge Intelligence, today announced a strategic partnership with Ion LATAM, a premier sales and marketing manufacturer’s representative organization covering Mexico, Central America and South America. Designed to broaden Lantronix’s market presence in Latin America, this relationship will expand access of its cutting-edge IoT and AI Edge solutions to the companies’ mutual customers.

    “We are pleased to add Ion LATAM to our network of trusted partners and are excited about growing our business in Latin America in response to the increasing demand for secure, reliable IoT solutions,” said Kurt Hoff, VP of Global Sales & Marketing at Lantronix. “This relationship represents a significant milestone in Lantronix’s ongoing commitment to delivering innovative products and services throughout Latin America and the world at large.”

    Under this agreement, Ion LATAM will promote Lantronix’s comprehensive IoT and intelligence edge product portfolio and will also provide expert technical support to customers in Latin America. By leveraging Ion LATAM’s deep industry expertise and customer relationships, the alliance is poised to accelerate the adoption of Lantronix’s innovative solutions across Mexico, Central America and South America.

    “We are thrilled to partner with Lantronix,” said Toby Lasley, president of Ion LATAM. “As a manufacturer representative, we see immense value in offering Lantronix’s world-class IoT and AI Edge Intelligent products,, engineering services and AI-powered Out-of-Band solutions to our customers. This collaboration aligns perfectly with our mission to deliver leading-edge technology to our markets.”

    About Lantronix

    Lantronix Inc. is a global leader of compute and connectivity IoT solutions that target high-growth markets, including Smart Cities, Enterprise and Transportation. Lantronix’s products and services empower companies to succeed in the growing IoT markets by delivering customizable solutions that enable AI Edge Intelligence. Lantronix’s advanced solutions include Intelligent Substations infrastructure, Infotainment systems and Video Surveillance, supplemented with advanced Out-of-Band Management (OOB) for Cloud and Edge Computing.

    For more information, visit the Lantronix website.

    “Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This news release contains forward-looking statements within the meaning of federal securities laws, including, without limitation, statements related to Lantronix leadership. These forward-looking statements are based on our current expectations and are subject to substantial risks and uncertainties that could cause our actual results, future business, financial condition, or performance to differ materially from our historical results or those expressed or implied in any forward-looking statement contained in this news release. The potential risks and uncertainties include, but are not limited to, such factors as the effects of negative or worsening regional and worldwide economic conditions or market instability on our business, including effects on purchasing decisions by our customers; our ability to mitigate any disruption in our and our suppliers’ and vendors’ supply chains due to the COVID-19 pandemic or other outbreaks, wars and recent tensions in Europe, Asia and the Middle East, or other factors; future responses to and effects of public health crises; cybersecurity risks; changes in applicable U.S. and foreign government laws, regulations, and tariffs; our ability to successfully implement our acquisitions strategy or integrate acquired companies; difficulties and costs of protecting patents and other proprietary rights; the level of our indebtedness, our ability to service our indebtedness and the restrictions in our debt agreements; and any additional factors included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024, filed with the Securities and Exchange Commission (the “SEC”) on Sept. 9, 2024, including in the section entitled “Risk Factors” in Item 1A of Part I of that report, as well as in our other public filings with the SEC. Additional risk factors may be identified from time to time in our future filings. In addition, actual results may differ as a result of additional risks and uncertainties of which we are currently unaware or which we do not currently view as material to our business. For these reasons, investors are cautioned not to place undue reliance on any forward-looking statements. The forward-looking statements we make speak only as of the date on which they are made. We expressly disclaim any intent or obligation to update any forward-looking statements after the date hereof to conform such statements to actual results or to changes in our opinions or expectations, except as required by applicable law or the rules of the Nasdaq Stock Market LLC. If we do update or correct any forward-looking statements, investors should not conclude that we will make additional updates or corrections.

    ©2025 Lantronix, Inc. All rights reserved. Lantronix is a registered trademark. Other trademarks and trade names are those of their respective owners.

    Lantronix Media Contact:
    Gail Kathryn Miller
    Corporate Marketing &
    Communications Manager
    media@lantronix.com

    Lantronix Analyst and Investor Contact:
    investors@lantronix.com

    The MIL Network –

    February 19, 2025
  • MIL-OSI Economics: Christopher J Waller: Disinflation progress uneven but still on track rates cuts on track as well

    Source: Bank for International Settlements

    Thank you, Bruce, and thank you for the opportunity to speak to you today. It’s great being back in Sydney and seeing old friends-like the Opera House!

    As I look at the U.S. economy today, I see that the real side is doing just fine but progress on lowering inflation has come in fits and starts.1 After two good months of inflation data for November and December, January once again disappointed and showed that progress on inflation remains uneven. I continue to believe that the current setting of monetary policy is restricting economic activity somewhat and putting downward pressure on inflation. If this winter-time lull in progress is temporary, as it was last year, then further policy easing will be appropriate. But until that is clear, I favor holding the policy rate steady.

    Spending by households and businesses has proved to be resilient, we have solid growth in real gross domestic product (GDP) and the latest data on employment, including revisions to most of 2024, support the view that labor market is in a sweet spot. Meanwhile, last week’s January inflation data have a similar feel to that of January 2024, albeit to a smaller degree; they surprised on the high side and raised concerns that the progress we made in pushing inflation toward our 2 percent goal would stall out. But once we got past the first quarter of last year, we did see continued progress in reducing inflation in the latter part of the year. The question now is if we will see progress again later this year, as we did in 2024.

    Progress on inflation is an important consideration in policymakers’ judgment about whether monetary policy needs adjustment in the near term. The continued solid labor market is one reason why I supported the Federal Open Market Committee’s (FOMC) decision at the end of January to hold our policy rate steady. After two good inflation reports for November and December there was concern about a January bounce back in inflation. So based on good labor market data and concerns about a seasonal shock to inflation not fully adjusted in the data, I felt it was prudent to stand pat at our January meeting. Given last week’s inflation report, that concern was warranted.

    Let me pause here for a moment to address some commentary after the FOMC meeting that cited uncertainty about the new Administration’s policies as a leading reason for that decision. We must keep in mind that there is always a degree of uncertainty about economic policy, and we need to act based on incoming data even when facing great uncertainty about the economic landscape. We have done this in the past and will continue to do so in the future.

    Let me provide two recent examples where the FOMC acted in the face of great uncertainty. In March 2022, inflation was roaring, and rate hikes were on the table. Then Russia invaded Ukraine, which created tremendous economic uncertainty around the globe. Not only did the FOMC raise the policy rate in March 2022 for the first time since 2019, but in subsequent meetings we also implemented large rate hikes for several meetings. We could not wait for uncertainty about the war to be resolved.

    The second episode was in March of 2023 when stresses emerged in the U.S. banking system, stemming in part from the failures of Silicon Valley Bank and Credit Suisse, with the latter occurring the weekend before our March FOMC meeting. There was great uncertainty as to whether these events would lead to financial instability and a significant contraction of credit that could trigger a recession. Many forecasters projected a recession would hit in the second half of 2023 as a result. Consequently, there were calls to stop hiking the policy rate due to a tremendous amount of financial and banking uncertainty. But the Federal Reserve worked in concert with other government agencies and used its financial stabilization tools to deal with the banking issues and continued raising the policy rate to deal with inflation.2 So the moral of this story is that monetary policy cannot be put on hold waiting for these types of uncertainty to resolve.

    Putting uncertainty aside, let me turn to my view of the economic data. As I noted, real GDP continued to grow solidly in the fourth quarter, at a pace of 2.3 percent, and would have been nearly 1 percentage point stronger without a reduction in inventories, which tend to be volatile. Personal consumption expenditures (PCE), which are typically two-thirds of GDP, grew a robust 4.2 percent in the fourth quarter. As was noted in the Fed’s latest Monetary Policy Report to Congress, households have a solid level of liquid assets to sustain their spending. Based on the limited data we have for the first quarter of 2025 this solid growth seems to be continuing. The employment report for January, which I will focus on in a moment, indicated a continued strong labor market, which should support consumption. Retail sales are reported to have fallen back in January after a strong rise in December, but given how volatile these data can be, and given that the cold weather in January probably held down sales, I’m not putting much weight on that reading for the time being. Business sentiment, as reflected in surveys of purchasing managers in both manufacturing and non-manufacturing, was among the most consistently positive in a while. The index for manufacturing businesses was 50.9, the first time since October 2022 that these results topped 50, as sentiment indicators about orders, production, and employment were all expanding. The corresponding index for the large majority of businesses outside manufacturing also indicated expansion, as it has for some time. The Blue Chip consensus of private forecasters and the Atlanta Fed’s GDP Now forecast based on the data in hand predict growth this quarter similar to that of the end of last year. To circle back to my message earlier, many people predicted that tariffs proposed by the Administration on February 1 would have a significant effect on trade and consumption in the first quarter, not to mention prices, but after the postponement of some of those tariffs, it is unclear to me if and when that might show up in the data. I will, of course, be watching closely, but I haven’t altered my outlook based on what has been implemented to date.

    As I noted earlier, data on the labor market indicate that it is in a good spot, with employers having an easier time filling jobs than earlier in the expansion but with still ample demand for new workers and new jobs being created. The unemployment rate ticked down to 4 percent, which is just about where it has been for the past year. Employers added a net 143,000 jobs in January, down some from a 204,000 average for the final three months of 2024 but right around the 133,000 average for the quarter before that. Two factors that may have held down this number a bit were cold weather and the fires in Los Angeles, which prevented thousands of people from getting to or performing their jobs. Beyond payrolls, the ratio of job vacancies to the number of unemployed people stands at 1.1, close to the level before the pandemic.

    Wage growth continues to be strong, and it has considerably outpaced price increases, but is down from two years ago, and for a few reasons, I don’t judge recent data as indicating that wages are a factor preventing inflation from making continued progress toward 2 percent. Though the January reading of average hourly earnings was a bit elevated, this series is pretty volatile and the reading may have been held up by weather-related issues. Smoothing through the monthly fluctuations, we see wage growth fairly steady at 4 percent a month over the past year. Broader measures of worker compensation show a more distinct moderation in growth. The Labor Department’s employment cost index has fallen gradually but consistently from 4.2 percent at the end of 2023 to 3.8 percent at its last reading.

    As for whether 4 percent wage growth is consistent with 2 percent inflation, I will note, as I have before, that productivity has grown at roughly a 2 percent annual rate since the advent of the pandemic-and slightly faster than that in 2023 and 2024. Unless that productivity trend changes a lot, wage growth is consistent with bringing inflation down to 2 percent.

    Turning to inflation, last week’s data taken as a whole were mildly disappointing but not nearly so disappointing as a focus on the consumer price index (CPI) alone would have indicated. Total CPI inflation for January came in hot at 0.5 percent, and core was 0.4 percent, which brings the 12-month changes to 3.0 percent and 3.3 percent, respectively. These 12-month readings are lower than we had in January 2024, so we have made some progress over the past year, but they are still too high.

    However, we also received producer price data last week, and, combining that information with the CPI data, forecasts for January PCE inflation aren’t as alarming as the CPI inflation data. Estimates for total PCE inflation, the FOMC’s preferred measure, are about 0.3 percent and that for core PCE inflation was around 0.25 percent. These numbers will mean a bump-up in the monthly pace of core inflation of about one-tenth of 1 percentage point from readings of under 0.2 percent in November and December. And this would leave the 12-month and 6-month average core PCE inflation around 2.6 percent and 2.4 percent, respectively. These rates are lower than where they stood in January 2024, which is good, but progress has been slower than I expected on reducing inflation to our 2 percent target.

    As a policymaker, I rely on these data to help me judge how close we are to meeting our inflation target. And I’m thinking hard about how to interpret these recent numbers because there seems to be some pattern over the past few years of higher inflation readings at the start of the year. This pattern brings into question whether the inflation data have “residual seasonality,” which means that statisticians have not fully corrected for some apparent seasonal fluctuations in some prices. Many firms reset their prices at the beginning of each year, and the Commerce Department tries to factor this in, but even after this adjustment, there is a consensus among economists that some seasonality remains. Incidentally, this probably isn’t just a problem in January. Some recently updated research by the Fed staff shows that inflation in the first months of the year has been higher than in the second half for 16 of the last 22 years.3 I’m alert to this issue and will watch the data over the next few months to evaluate if we are having what looks like a repeat of high first quarter inflation data that could be followed by lower readings later in the year.

    Before I get to my outlook for monetary policy, I want to address a topic of some debate recently, which is the divergence between long-term interest rates and the FOMC’s policy rate since we started cutting rates in September. While the FOMC has reduced the policy rate 100 basis points since then, yields on the benchmark 10-year Treasury security have increased by a noticeable amount. In theory, longer-term rates should follow the expected path of the overnight policy rate set by the FOMC. But this relationship is based on the classic economic assumption of ceteris paribus, or “all other factors remaining constant.” The 10-year Treasury security trades in a deep, liquid global market, and its yield is affected by a variety of factors other than the path of the policy rate. This means that all other factors are not constant and that the 10-year Treasury yield may not follow the federal funds rate.

    Perhaps the most famous example of the divergence of market interest rates and policy rates began in the mid 2000’s. The FOMC was tightening monetary policy from 2004 to 2006 and raised the policy rate 425 basis points. Over that time, Treasury yields barely moved. This was so surprising that Fed Chairman Alan Greenspan referred to it as a “conundrum.” At about the same time, future Chair Ben Bernanke identified what he called a “global savings glut” that was pushing up foreign demand for Treasury securities and putting downward pressure on yields. Over time, this has come to be seen as a significant factor for the conundrum then and as a factor for low Treasury yields subsequently. This example is just to illustrate that the 10-year Treasury yield may not respond to the policy rate as expected because of a variety of factors that are beyond the control of the FOMC.

    So, what does my economic outlook mean for monetary policy? The labor market is balanced and remarkably resilient. If you want an example of a stable labor market with employment at its maximum level, it looks a lot like where we are right now. On the other side of the FOMC’s mandate, inflation is still meaningfully above our target, and progress has been excruciatingly slow over the last year. This tells me that we should currently have a restrictive setting of policy, as we do-to continue to move inflation down to our goal-but that setting should be getting closer to neutral as inflation moves closer to 2 percent and should allow the labor market to remain in a good place.

    So for now, I believe a pause in rate cuts is appropriate. Assuming the labor market continues to be in rough balance, I can wait and see if the higher inflation readings in January moderate, as they have in the past couple of years. If so, I’ll have to decide if this reflects residual seasonality that will go away later in the year and if the underlying trend in inflation is toward 2 percent, or if there is a different issue holding up inflation and how that may play out. Whichever case it may be, the data are not supporting a reduction in the policy rate at this time. But if 2025 plays out like 2024, rate cuts would be appropriate at some point this year.

    And while we are waiting on data to understand how the economy is moving relative to our objectives, we will learn more about Administration policies. My baseline view is that any imposition of tariffs will only modestly increase prices and in a non-persistent manner. So I favor looking through these effects when setting monetary policy to the best of our ability. Of course, I concede that the effects of tariffs could be larger than I anticipate, depending on how large they are and how they are implemented. But we also need to remember that it is possible that other policies under discussion could have positive supply effects and put downward pressure on inflation. At the end of the day, the data should be guiding our policy action-not speculation about what could happen. And if the incoming data supports further rate cuts or staying on pause, then we should do so regardless of how much clarity we have on what policies the Administration adopts. Waiting for economic uncertainty to dissipate is a recipe for policy paralysis.


    MIL OSI Economics –

    February 19, 2025
  • MIL-OSI: Diamondback Energy, Inc. Announces Midland Basin Acquisition

    Source: GlobeNewswire (MIL-OSI)

    MIDLAND, Texas, Feb. 18, 2025 (GLOBE NEWSWIRE) — Diamondback Energy, Inc. (NASDAQ: FANG) (“Diamondback” or “the Company”) today announced that it has entered into a definitive purchase agreement to acquire certain subsidiaries of Double Eagle IV Midco, LLC (“Double Eagle”) in exchange for approximately 6.9 million shares of Diamondback common stock and $3 billion of cash, subject to customary adjustments (the “Double Eagle Acquisition”). The cash portion of this transaction is expected to be funded through a combination of cash on hand, borrowings under the Company’s credit facility and/or proceeds from term loans and senior notes offerings.

    As part of this agreement, Diamondback and Double Eagle have also agreed to accelerate development on a portion of Diamondback’s non-core southern Midland Basin acreage. This acceleration is expected to bring forward Net Asset Value (“NAV”) to Diamondback by developing Diamondback’s lower quality acreage at a faster pace than current expectations. As a result, Diamondback expects significant Free Cash Flow growth in 2026 and beyond with minimal capital deployment through this accelerated development plan.

    Diamondback is also committing today to sell at least $1.5 billion of non-core assets to accelerate pro forma debt reduction in order to maintain its strong balance sheet. Diamondback expects to reduce net debt to $10 billion and, long term, maintain leverage of $6 billion to $8 billion.

    “Double Eagle is the most attractive asset remaining in the Midland Basin,” stated Travis Stice, Chairman and Chief Executive Officer of Diamondback. “With 407 locations adjacent to our core position, this largely undeveloped asset adds high-quality inventory that immediately competes for capital. Additionally, we see value uplift to our existing inventory as acreage overlap allows for meaningful lateral length extensions and infrastructure synergies. We look forward to seamlessly implementing our industry leading cost and operational structure on this differentiated asset.”

    Mr. Stice continued, “The Permian Basin continues to consolidate rapidly. We have worked tirelessly over the last thirteen years to position Diamondback to have the longest duration of high quality, low-breakeven inventory; a position we are solidifying with today’s announcement.  While we are adding a small amount of leverage to complete this trade, we are confident that we can quickly reduce debt both naturally through our consistent and growing Free Cash Flow and through our commitment to sell at least $1.5 billion of non-core assets.”

    Cody Campbell and John Sellers, Co-Chief Executive Officers of Double Eagle, commented, “We are excited to announce our agreement with Diamondback. We believe our team has built a truly standout asset that further increases Diamondback’s high-quality inventory. It was important to us that we maintain the stewardship of this asset going forward not only with a world-class Midland operator but also a group that shares our core values and understands the importance of community impact in West Texas.”

    Asset Highlights: Consolidated Scale in the Midland Basin

    • Approximately 40,000 net acres in the core of the Midland Basin
    • Estimated run-rate production of approximately 27 MBo/d (69% oil)
    • $200 million of capital expenditures anticipated in 2025 at current Midland Basin well costs of $555 to $605 per foot
    • Extends pro forma inventory life in the core of the Midland Basin
    • 68% of the asset is undeveloped with 407 estimated gross (342 net) horizontal locations in primary development targets with an average lateral length of approximately >11,000’
    • 44 gross upside locations primarily located in emerging zones

    Transaction Highlights

    • Valued at approximately 5.2x 2025 EBITDA
    • Enhances expected pro forma 2026 Free Cash Flow per share by 5%+
    • Immediately accretive to all relevant financial metrics including Cash Flow per share, Free Cash Flow per share and NAV per share

    Timing and Approvals

    Diamondback expects the transaction to close on April 1, 2025, subject to the satisfaction of customary closing conditions and regulatory approval.

    Advisors

    TPH&Co, the energy business of Perella Weinberg Partners, is serving as financial advisor to Diamondback. Kirkland & Ellis LLP is acting as legal advisor to Diamondback.

    RBC Capital Markets, Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC are acting as financial advisors to Double Eagle. Vinson & Elkins LLP is acting as legal advisor to Double Eagle.

    About Diamondback

    Diamondback is an independent oil and natural gas company headquartered in Midland, Texas focused on the acquisition, development, exploration and exploitation of unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas. For more information, please visit www.diamondbackenergy.com.

    Forward-Looking Statements

    This news release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, which involve risks, uncertainties, and assumptions. All statements, other than statements of historical fact, including statements regarding Diamondback’s: future performance; business strategy; future operations (including drilling plans and capital plans); estimates and projections of production, revenues, losses, costs, expenses, returns, cash flow, and financial position; reserve estimates and its ability to replace or increase reserves; anticipated benefits or other effects of strategic transactions (including the pending drop down transaction with Viper Energy, Inc., the Double Eagle Acquisition and other acquisitions or divestitures); and plans and objectives of management (including plans for future cash flow from operations) are forward-looking statements. When used in this news release, the words “aim,” “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,” “may,” “model,” “outlook,” “plan,” “positioned,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” and similar expressions (including the negative of such terms) as they relate to Diamondback are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Although Diamondback believes that the expectations and assumptions reflected in its forward-looking statements are reasonable as and when made, they involve risks and uncertainties that are difficult to predict and, in many cases, beyond Diamondback’s control. Accordingly, forward-looking statements are not guarantees of future performance and Diamondback’s actual outcomes could differ materially from what Diamondback has expressed in its forward-looking statements.

    Factors that could cause the outcomes to differ materially include (but are not limited to) the following: changes in supply and demand levels for oil, natural gas, and natural gas liquids, and the resulting impact on the price for those commodities; the impact of public health crises, including epidemic or pandemic diseases and any related company or government policies or actions; actions taken by the members of OPEC+ and Russia affecting the production and pricing of oil, as well as other domestic and global political, economic, or diplomatic developments, including any impact of the ongoing war in Ukraine and the Israel-Hamas war on the global energy markets and geopolitical stability; instability in the financial markets; trade wars; inflationary pressures; higher interest rates and their impact on the cost of capital; regional supply and demand factors, including delays, curtailment delays or interruptions of production, or governmental orders, rules or regulations that impose production limits; federal and state legislative and regulatory initiatives relating to hydraulic fracturing, including the effect of existing and future laws and governmental regulations; physical and transition risks relating to climate change; those risks described in Item 1A of Diamondback’s Annual Report on Form 10-K, filed with the SEC on February 22, 2024, and those risks disclosed in its subsequent filings on Forms 10-Q and 8-K, which can be obtained free of charge on the SEC’s website at http://www.sec.gov and Diamondback’s website at www.diamondbackenergy.com/investors.

    In light of these factors, the events anticipated by Diamondback’s forward-looking statements may not occur at the time anticipated or at all. Moreover, Diamondback operates in a very competitive and rapidly changing environment and new risks emerge from time to time. Diamondback cannot predict all risks, nor can it assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those anticipated by any forward-looking statements it may make. Accordingly, you should not place undue reliance on any forward-looking statements. All forward-looking statements speak only as of the date of this news release or, if earlier, as of the date they were made. Diamondback does not intend to, and disclaims any obligation to, update or revise any forward-looking statements unless required by applicable law.

    Diamondback Investor Contact:

    Adam Lawlis
    +1 432.221.7467
    alawlis@diamondbackenergy.com

    The MIL Network –

    February 19, 2025
  • MIL-OSI Asia-Pac: President Lai meets British-Taiwanese All-Party Parliamentary Group delegation

    Source: Republic of China Taiwan

    Details
    2025-02-17
    President Lai meets former United States Deputy National Security Advisor Matthew Pottinger
    On the morning of February 17, President Lai Ching-te met with a delegation led by former United States Deputy National Security Advisor Matthew Pottinger. In remarks, President Lai thanked the delegation for demonstrating staunch support for Taiwan through their visit. The president pointed out that increased cooperation between authoritarian regimes is posing risks and challenges to the geopolitical landscape and regional security. He emphasized that only by bolstering our defense capabilities can we demonstrate effective deterrence and maintain peace and stability across the Taiwan Strait and around the world. The president stated that moving forward, Taiwan will continue to enhance its self-defense capabilities. He also expressed hope of strengthening the Taiwan-US partnership and jointly building secure and resilient non-red supply chains so as to ensure that Taiwan, the US, and democratic partners around the world maintain a technological lead. A translation of President Lai’s remarks follows: I am delighted to welcome our good friends Mr. Pottinger and retired US Rear Admiral Mr. Mark Montgomery to Taiwan once again. Last June, Mr. Pottinger and Mr. Ivan Kanapathy came to Taiwan to launch their new book The Boiling Moat. During that visit, they also visited the Presidential Office. We held an extensive exchange of views on Taiwan-US relations and regional affairs right here in the Taiwan Heritage Room. Now, as we meet again eight months later, I am pleased to learn that Mr. Kanapathy is now serving on the White House National Security Council. The Mandarin translation of The Boiling Moat is also due to be released in Taiwan very soon. This book offers insightful observations from US experts regarding US-China-Taiwan relations and valuable advice for the strengthening of Taiwan’s national defense, security, and overall resilience. I am sure that Taiwanese readers will benefit greatly from it. I understand that this is Mr. Montgomery’s fourth visit to Taiwan and that he has long paid close attention to Taiwan-related issues. I look forward to an in-depth discussion with our two friends on the future direction of Taiwan-US relations and cooperation. Increased cooperation between authoritarian regimes is posing risks and challenges to the geopolitical landscape and regional security. One notion we all share is peace through strength. That is, only by bolstering our defense capabilities and fortifying our defenses can we demonstrate effective deterrence and maintain peace and stability across the Taiwan Strait and around the world. Moving forward, Taiwan will continue to enhance its self-defense capabilities. We also hope to strengthen the Taiwan-US partnership in such fields as security, trade and the economy, and energy. In addition, we will advance cooperation in critical and innovative technologies and jointly build secure and resilient non-red supply chains. This will ensure that Taiwan, the US, and democratic partners around the world maintain a technological lead. We believe that closer Taiwan-US exchanges and cooperation not only benefit national security and development but also align with the common economic interests of Taiwan and the US. I want to thank Mr. Pottinger and Mr. Montgomery once again for visiting and for continuing to advance Taiwan-US exchanges, demonstrating staunch support for Taiwan. Let us continue to work together to deepen Taiwan-US relations. I wish you a smooth and fruitful visit.  Mr. Pottinger then delivered remarks, first congratulating President Lai on his one-year election anniversary and on the state of the economy, which, he added, is doing quite well. Mentioning President Lai’s recent statement pledging to increase Taiwan’s defense budget to above 3 percent of GDP, Mr. Pottinger said he thinks that the benchmark is equal to what the US spends on its defense and that it is a good starting point for both countries to build deterrence. Echoing the president’s earlier remarks, Mr. Pottinger said that peace through strength is the right path for the US and for Taiwan right now at a moment when autocratic, aggressive governments are on the march. He then paraphrased the words of former US President George Washington in his first inaugural address, saying that the best way to keep the peace is to be prepared at all times for war, which captures the meaning of peace through strength. In closing, he said he looks forward to exchanging views with President Lai.

    Details
    2025-02-17
    President Lai meets Deputy Prime Minister Thulisile Dladla of the Kingdom of Eswatini
    On the afternoon of February 11, President Lai Ching-te met with a delegation led by Deputy Prime Minister Thulisile Dladla of the Kingdom of Eswatini. In remarks, President Lai thanked Eswatini for continuing to support Taiwan’s international participation at international venues. The president stated that Taiwan and Eswatini work closely in such areas as agriculture, the economy and trade, education, and healthcare, and expressed hope that the two countries will continue to support each other on the international stage and strive together for the well-being of both peoples.  A translation of President Lai’s remarks follows: I warmly welcome our distinguished guests to the Presidential Office. Deputy Prime Minister Dladla previously visited Taiwan while serving as minister of foreign affairs. This is her first time leading a delegation here as deputy prime minister. I want to extend my sincerest welcome. Deputy Prime Minister Dladla has earned a high degree of recognition and trust from His Majesty King Mswati III. She was not only Eswatini’s first woman foreign minister, but is also the second woman to have held her current key position. She shows an active interest in people’s welfare, and has a reputation for being deeply devoted to her compatriots. I have great admiration for this. I am truly delighted to meet with Deputy Prime Minister Dladla today. I would like to take this opportunity to once again express my gratitude to His Majesty the King for leading a delegation to attend the inauguration ceremony for myself and Vice President Bi-khim Hsiao last year. This demonstrated the close diplomatic ties between our countries. I also want to thank Eswatini for continuing to support Taiwan’s international participation at international venues. I would ask that when Deputy Prime Minister Dladla returns to Eswatini, she conveys Taiwan’s greetings and gratitude to His Majesty the King and Her Majesty the Queen Mother Ntombi Tfwala. Diplomatic ties between Taiwan and Eswatini have endured for over half a century. Our two nations have continued to work closely in such areas as agriculture, the economy and trade, education, and healthcare. Our largest collaboration to date has been assisting Eswatini in the construction of a strategic oil reserve facility. We will continue to push forward with this project, and look forward to achieving even greater results in all areas. I understand that Deputy Prime Minister Dladla is very concerned about issues regarding gender equality and women’s empowerment. During her term as foreign minister, she facilitated bilateral cooperation in those areas. Now, as deputy prime minister, she is actively attending to the disadvantaged and advancing social welfare. These policies are very much in line with the priorities of my administration. I look forward to strengthening cooperation with Deputy Prime Minister Dladla for the benefit of both our societies. Taiwan and Eswatini are peace-loving nations. Faced with a constantly changing international landscape and the growing threat posed by authoritarianism, we hope that our two countries will continue to support each other on the international stage and strive together for the well-being of both our peoples. In closing, I wish Deputy Prime Minister Dladla and our distinguished guests a pleasant and successful visit. Deputy Prime Minister Dladla then delivered remarks, first greeting President Lai on behalf of the King, the Queen Mother, and the people of Eswatini, and extending gratitude for the warm reception afforded to her and her delegation, which underscores the strong bonds of friendship between our two nations. The deputy prime minister stated that, in reflecting on the fruits of our partnership, the evidence of Taiwan’s commitment to Eswatini is all around us. The strategic oil reserve project launching in April, she indicated, will redefine Eswatini’s energy security, and the Central Bank complex and electrification project stand as monuments of Taiwan’s vision for Eswatini’s progress and indicate that our partnerships are very strong. Deputy Prime Minister Dladla pointed out that education is the foundation of any nation’s progress, and that Taiwan’s contribution to Eswatini’s education sector cannot be overstated. Through Ministry of Foreign Affairs scholarship programs, she said, Eswatini has sent numerous students to Taiwan, where they’ve received world-class education in various disciplines, including engineering, business, and medicine. In turn, she said, these graduates are now contributing to the development of Eswatini. The deputy prime minister stated that Taiwan has also strengthened Eswatini’s industrial and technological sectors, with collaborations and partnerships that create new opportunities for employment and innovation, and that Taiwan’s technical and medical assistance has strengthened Eswatini’s healthcare systems and uplifted the expertise of its professionals. Deputy Prime Minister Dladla also congratulated President Lai once again on his presidency, which she stated will lead Taiwan to new heights, adding that His Majesty coming to Taiwan personally for the inauguration was a resounding declaration of Eswatini’s enduring support for Taiwan’s sovereignty, stability, and rightful place on the world stage. She emphasized that Eswatini stands with Taiwan always and unwaveringly. In conclusion, the deputy prime minister stated that Eswatini fully agrees with Taiwan that we must all safeguard our national sovereignty and protect the lives and property of our people. She said that our common enemy will always be poverty and natural disasters, but against all odds, we will stand united, and we shall remain united and be one. The delegation was accompanied to the Presidential Office by Eswatini Ambassador Promise Sithembiso Msibi.

    Details
    2025-02-17
    Presidential Office thanks US and Japan for joint leaders’ statement
    On February 7 (US EST), President Donald Trump of the United States and Prime Minister Ishiba Shigeru of Japan issued a joint leaders’ statement reiterating “the importance of maintaining peace and stability across the Taiwan Strait as an indispensable element of security and prosperity for the international community.” In the statement, the two leaders also “encouraged the peaceful resolution of cross-strait issues, and opposed any attempts to unilaterally change the status quo by force or coercion” and “expressed support for Taiwan’s meaningful participation in international organizations.” Presidential Office Spokesperson Karen Kuo (郭雅慧) on February 8 expressed sincere gratitude on behalf of the Presidential Office to the leaders of both countries for taking concrete action to demonstrate their firm support for peace and stability across the Taiwan Strait and for Taiwan’s international participation. Spokesperson Kuo pointed out that there is already a strong international consensus on the importance of peace and stability in the Indo-Pacific region. The spokesperson emphasized that Taiwan, as a responsible member of the international community, is capable and willing to work together with the international community and will continue strengthening its self-defense capabilities as it deepens its trilateral security partnership with the US and Japan and works alongside like-minded countries to uphold the rules-based international order. The spokesperson said that Taiwan will work toward ensuring a free and open Taiwan Strait and Indo-Pacific region, as well as global peace, stability, and prosperity, as it continues to act as a force for good in the world.

    Details
    2025-02-17
    President Lai’s response to Pope Francis’s 2025 World Day of Peace message  
    President Lai Ching-te recently sent a letter to Pope Francis of the Catholic Church in response to his message marking the 58th World Day of Peace. The following is the full text of the president’s letter to the pope: Your Holiness, In your message for the 2025 World Day of Peace entitled Forgive us our trespasses: grant us your peace, you called for a cultural change that would bring an end to the governance of interpersonal and international relations by a logic of exploitation and oppression and herald true and lasting peace. I wholeheartedly admire and identify with your point of view. Since transitioning from a medical career to politics, I have remained true to my original intentions in the sense that, while a doctor can help only one person at a time, a public servant can simultaneously assist many people in resolving the difficulties affecting their lives. In my inaugural address in May 2024, I pledged that every day of my term, I would strive to act justly, show mercy, and be humble, which accord with the teachings of the Bible. I promised to treat the Taiwanese people as family and prove myself worthy of their trust and expectations. With an unwavering heart, I have accepted the people’s trust and taken on the solemn responsibility of leading the nation forward and building a democratic, peaceful, and prosperous new Taiwan. In this new year, the changing international landscape continues to present many grave challenges to democratic nations around the world. As the Russia-Ukraine war persists, the steady convergence of authoritarian regimes, including China, Russia, North Korea, and Iran, threatens the rules-based international order and severely impacts peace and stability in the Indo-Pacific and the world at large. Your Holiness has stated that war is a defeat for everyone. I, too, firmly believe that peace is priceless and that war has no winners. A high level of consensus has formed in the international community on upholding peace and stability across the Taiwan Strait. The Taiwanese people also maintain an unyielding commitment to safeguarding a way of life that encompasses freedom, equality, democracy, and human rights. Taiwan will continue to spare no effort in preserving regional peace and stability and serving as a pilot for global peace. In your World Day of Peace message, you urged prosperous countries to assist poorer ones. This compassion is truly touching. Taiwan is proactively implementing values-based diplomacy and, under the Diplomatic Allies Prosperity Project, enhancing allies’ development through a range of initiatives. Over many years, Taiwan has accumulated abundant and unique experience of providing foreign assistance. Seeking to foster self-reliance among disadvantaged countries, we have extended genuine support to help alleviate poverty through such avenues as strengthening basic infrastructure, transferring technology, and cultivating talent. In your message, you reminded countries worldwide that assistance should not be merely an isolated act of charity and pointed to the need to devise a new global financial framework so that food crises, climate change, and other challenges could be jointly addressed. I hold this view in high regard. I therefore earnestly hope that international organizations will stop excluding Taiwan for political reasons. Taiwan is willing to shoulder its international responsibilities so that it can contribute and share its valuable experience through many global platforms.  On behalf of the government and people of the Republic of China (Taiwan), I again express our interest in collaborating with the Holy See to advance world peace through concrete action. We also aspire to demonstrate Taiwanese values and the Taiwanese spirit and work together with the Holy See to uphold the core values of justice, democracy, freedom, and peace.  Please accept, Your Holiness, the renewed assurances of my highest consideration, as well as my best wishes for your good health and the continued growth of the Catholic Church.

    Details
    2025-02-17
    President Lai meets former US Vice President Mike Pence
    On the afternoon of January 17, President Lai Ching-te met with former Vice President of the United States Mike Pence. In remarks, President Lai thanked former Vice President Pence for his contributions to the deepening of Taiwan-US relations, noting that he actively helped to strengthen Taiwan-US cooperation and facilitate the normalization of military sales to Taiwan, and did his utmost to deepen the Taiwan-US economic partnership. The president indicated that former Vice President Pence also spoke up for Taiwan on numerous occasions at international venues, backing Taiwan’s international participation. President Lai expressed hope for a stronger Taiwan-US partnership to maintain peace and stability throughout the world, and that the two sides can advance bilateral exchanges in such areas as the economy, trade, and industry. A translation of President Lai’s remarks follows: I am delighted to welcome former Vice President Pence and Mrs. Karen Pence to the Presidential Office. Former Vice President Pence is not only an outstanding political leader in the US, but also a staunch supporter of Taiwan on the international stage. On behalf of the people of Taiwan, I would like to take this opportunity to extend our deepest gratitude to former Vice President Pence for his contributions to the deepening of Taiwan-US relations. Thanks to former Vice President Pence’s strong backing, ties between Taiwan and the US rose to unprecedented heights during President Donald Trump’s first administration. Former Vice President Pence actively helped to strengthen Taiwan-US security cooperation and facilitate the normalization of military sales to Taiwan, helping Taiwan reinforce its self-defense capabilities. He also did his utmost to deepen the Taiwan-US economic partnership. Former Vice President Pence also paid close attention to the military threats and diplomatic isolation faced by Taiwan. He spoke up for Taiwan on numerous occasions at international venues, taking concrete action to back Taiwan’s international participation. We were truly grateful for this. As we speak, China’s political and military intimidation against Taiwan persist. China and other authoritarian regimes, such as Russia, North Korea, and Iran, are continuing to converge and present serious challenges to democracies around the globe. At this moment, free and democratic nations must come together to bolster cooperation. I believe that a stronger Taiwan-US partnership can be an even more powerful force in maintaining peace and stability throughout the world. Former Vice President Pence has previously supported the signing of a trade agreement between Taiwan and the US. Taiwan looks forward to continuing to work with the new US administration and Congress to advance bilateral exchanges in such areas as the economy, trade, and industry. This is the first time that former Vice President Pence and Mrs. Pence are visiting Taiwan, and their visit is significantly meaningful for Taiwan-US exchanges. On behalf of the people of Taiwan, I want to extend a warm welcome. Moving forward, I hope we will jointly realize even more fruitful achievements through Taiwan-US cooperation. Former Vice President Pence then delivered remarks, thanking President Lai for his hospitality on his and his wife’s first visit to Taiwan, saying that it is an honor to be here to reaffirm the bonds of friendship between the people of America and the people of Taiwan, which are strong and longstanding. The former vice president indicated that the American people admire the people of Taiwan and all that has been accomplished in a few short decades for Taiwan to rise to one of the world’s preeminent economic powers and free societies. He said that he is grateful for President Lai’s courageous and bold leadership of Taiwan, and grateful to be able to express the support of the overwhelming majority of the American people for this alliance. Former Vice President Pence indicated that the values shared by Taiwan and the US, including freedom, the rule of law, and respect for human rights, bind us together in a partnership that transcends geographic boundaries and cultures. He then assured President Lai that China’s increasingly aggressive posture in the Taiwan Strait and across the Indo-Pacific, for the values and interests that both sides share, is deeply concerning to the American people. Former Vice President Pence stated that America is a Pacific nation, and is committed to the status quo, adding that they recognize it is China that wants to change the status quo that America, Taiwan, and other allies in the region want to preserve, which has created an environment of extraordinary growth and prosperity. The former vice president concluded by once again thanking President Lai and his team for their gracious hospitality and conveying best wishes to him and the people of Taiwan. Former Vice President Pence then assured President Lai that just as Taiwan will never surrender its freedom, he will continue to be a voice for a strong US-Taiwan relationship in the defense and the benefit of Taiwan, the US, and the free world. Later that day, Vice President Bi-khim Hsiao hosted a banquet for former Vice President Pence and his delegation at Taipei Guest House to thank him for his longstanding friendship and staunch support for Taiwan-US ties.  

    Details
    2025-02-14
    President Lai holds press conference following high-level national security meeting
    On the morning of February 14, President Lai Ching-te convened the first high-level national security meeting of the year, following which he held a press conference. In remarks, President Lai announced that in this new year, the government will prioritize special budget allocations to ensure that Taiwan’s defense budget exceeds 3 percent of GDP. He stated that the government will also continue to reform national defense, reform our legal framework for national security, and advance our economic and trade strategy of being rooted in Taiwan while expanding globally. The president also proposed clear-cut national strategies for Taiwan-US relations, semiconductor industry development, and cross-strait relations. President Lai indicated that he instructed the national security and administrative teams to take swift action and deliver results, working within a stable strategic framework and according to the various policies and approaches outlined. He also instructed them to keep a close watch on changes in the international situation, seize opportunities whenever they arise, and address the concerns and hope of the citizens with concrete actions. He expressed hope that as long as citizens remain steadfast in their convictions, are willing to work hand in hand, stand firm amidst uncertainty, and look for ways to win within changing circumstances, Taiwan is certain to prevail in the test of time yet again. A translation of President Lai’s remarks follows: First, I would like to convey my condolences for the tragic incident which occurred at the Shin Kong Mitsukoshi department store in Taichung, which resulted in numerous casualties. I have instructed Premier Cho Jung-tai (卓榮泰) to lead the relevant central government agencies in assisting Taichung’s municipal government with actively resolving various issues regarding the incident. It is my hope that these issues can be resolved efficiently. Earlier today, I convened this year’s first high-level national security meeting. I will now report on the discussions from the meeting to all citizens. 2025 is a year full of challenges, but also a year full of hope. In today’s global landscape, the democratic world faces common threats posed by the convergence of authoritarian regimes, while dumping and unfair competition from China undermine the global economic order. A new United States administration was formed at the beginning of the year, adopting all-new strategies and policies to address challenges both domestic and from overseas. Every nation worldwide, including ours, is facing a new phase of changes and challenges. In face of such changes, ensuring national security, ensuring Taiwan’s indispensability in global supply chains, and ensuring that our nation continues to make progress amidst challenges are our top priorities this year. They are also why we convened a high-level national security meeting today. At the meeting, the national security team, the administrative team led by Premier Cho, and I held an in-depth discussion based on the overall state of affairs at home and abroad and the strategies the teams had prepared in response. We summed up the following points as an overall strategy for the next stage of advancing national security and development. First, for overall national security, so that we can ensure the freedom, democracy, and human rights of the Taiwanese people, as well as the progress and development of the nation as we face various threats from authoritarian regimes, Taiwan must resolutely safeguard national sovereignty, strengthen self-sufficiency in national defense, and consolidate national defense. Taiwan must enhance economic resilience, maintain economic autonomy, and stand firm with other democracies as we deepen our strategic partnerships with like-minded countries. As I have said, “As authoritarianism consolidates, democratic nations must come closer in solidarity!” And so, in this new year, we will focus on the following three priorities: First, to demonstrate our resolve for national defense, we will continue to reform national defense, implement whole-of-society defense resilience, and prioritize special budget allocations to ensure that our defense budget exceeds 3 percent of GDP. Second, to counter the threats to our national security from China’s united front tactics, attempts at infiltration, and cognitive warfare, we will continue with the reform of our legal framework for national security and expand the national security framework to boost societal resilience and foster unity within. Third, to seize opportunities in the restructuring of global supply chains and realignment of the economic order, we will continue advancing our economic and trade strategy of being rooted in Taiwan while expanding globally, strengthening protections for high-tech, and collaborating with our friends and allies to build supply chains for global democracies. Everyone shares concern regarding Taiwan-US relations, semiconductor industry development, and cross-strait relations. For these issues, I am proposing clear-cut national strategies. First, I will touch on Taiwan-US relations. Taiwan and the US have shared ideals and values, and are staunch partners within the democratic, free community. We are very grateful to President Donald Trump’s administration for their continued support for Taiwan after taking office. We are especially grateful for the US and Japan’s joint leaders’ statement reiterating “the importance of maintaining peace and stability across the Taiwan Strait as an indispensable element of security and prosperity for the international community,” as well as their high level of concern regarding China’s threat to regional security. In fact, the Democratic Progressive Party government has worked very closely with President Trump ever since his first term in office, and has remained an international partner. The procurement of numerous key advanced arms, freedom of navigation critical for security and stability in the Taiwan Strait, and many assisted breakthroughs in international diplomacy were made possible during this time. Positioned in the first island chain and on the democratic world’s frontline countering authoritarianism, Taiwan is willing and will continue to work with the US at all levels as we pursue regional stability and prosperity, helping realize our vision of a free and open Indo-Pacific. Although changes in policy may occur these next few years, the mutual trust and close cooperation between Taiwan and Washington will steadfastly endure. On that, our citizens can rest assured. In accordance with the Taiwan Relations Act and the Six Assurances, the US announced a total of 48 military sales to Taiwan over the past eight years amounting to US$26.265 billion. During President Trump’s first term, 22 sales were announced totaling US$18.763 billion. This greatly supported Taiwan’s defensive capabilities. On the foundation of our close cooperation with the past eight years’ two US administrations, Taiwan will continue to demonstrate our determination for self-defense, accelerate the bolstering of our national defense, and keep enhancing the depth and breadth of Taiwan-US security cooperation, along with all manner of institutional cooperation. In terms of bilateral economic cooperation, Taiwan has always been one of the US’s most reliable trade partners, as well as one of the most important cooperative partners of US companies in the global semiconductor industry. In the past few years, Taiwan has greatly increased both direct and indirect investment in the US. By 2024, investment surpassed US$100 billion, creating nearly 400,000 job opportunities. In 2023 and 2024, investment in the US accounted for over 40 percent of Taiwan’s overall foreign investment, far surpassing our investment in China. In fact, in 2023 and 2024, Taiwanese investment in China fell to 11 percent and 8 percent, respectively. The US is now Taiwan’s biggest investment target. Our government is now launching relevant plans in accordance with national development needs and the need to establish secure supply systems, and the Executive Yuan is taking comprehensive inventory of opportunities for Taiwan-US economic and trade cooperation. Moving forward, close bilateral cooperation will allow us to expand US investment and procurement, facilitating balanced trade. Our government will also strengthen guidance and support for Taiwanese enterprises on increasing US investment, and promote the global expansion and growth of Taiwan’s industries. We will also boost Taiwan-US cooperation in tech development and manufacturing for AI and advanced semiconductors, and work together to maintain order in the semiconductor market, shaping a new era for our strategic economic partnership. Second, the development of our semiconductor industry. I want to emphasize that Taiwan, as one of the world’s most capable semiconductor manufacturing nations, is both willing and able to address new situations. With respect to President Trump’s concerns about our semiconductor industry, the government will act prudently, strengthen communications between Taiwan and the US, and promote greater mutual understanding. We will pay attention to the challenges arising from the situation and assist businesses in navigating them. In addition, we will introduce an initiative on semiconductor supply chain partnerships for global democracies. We are willing to collaborate with the US and our other democratic partners to develop more resilient and diversified semiconductor supply chains. Leveraging our strengths in cutting-edge semiconductors, we will form a global alliance for the AI chip industry and establish democratic supply chains for industries connected to high-end chips. Through international cooperation, we will open up an entirely new era of growth in the semiconductor industry. As we face the various new policies of the Trump administration, we will continue to uphold a spirit of mutual benefit, and we will continue to communicate and negotiate closely with the US government. This will help the new administration’s team to better understand how Taiwan is an indispensable partner in the process of rebuilding American manufacturing and consolidating its leadership in high-tech, and that Taiwan-US cooperation will benefit us both. Third, cross-strait relations. Regarding the regional and cross-strait situation, Taiwan-US relations, US-China relations, and interactions among Taiwan, the US, and China are a focus of global attention. As a member of the international democratic community and a responsible member of the region, Taiwan hopes to see Taiwan-US relations continue to strengthen and, alongside US-China relations, form a virtuous cycle rather than a zero-sum game where one side’s gain is another side’s loss. In facing China, Taiwan will always be a responsible actor. We will neither yield nor provoke. We will remain resilient and composed, maintaining our consistent position on cross-strait relations: Our determination to safeguard our national sovereignty and protect our free and democratic way of life remains unchanged. Our efforts to maintain peace and stability in the Taiwan Strait, as well as our willingness to work alongside China in the pursuit of peace and mutual prosperity across the strait, remain unchanged. Our commitment to promoting healthy and orderly exchanges across the strait, choosing dialogue over confrontation, and advancing well-being for the peoples on both sides of the strait, under the principles of parity and dignity, remains unchanged. Regarding the matters I reported to the public today, I have instructed our national security and administrative teams to take swift action and deliver results, working within a stable strategic framework and according to the various policies and approaches I just outlined. I have also instructed them to keep a close watch on changes in the international situation, seize opportunities whenever they arise, and address the concerns and hope of the citizens with concrete actions. My fellow citizens, over the past several years, Taiwan has weathered a global pandemic and faced global challenges, both political and economic, arising from the US-China trade war and Russia’s invasion of Ukraine. Through it all, Taiwan has persevered; we have continued to develop our economy, bolster our national strength, and raise our international profile while garnering more support – all unprecedented achievements. This is all because Taiwan’s fate has never been decided by the external environment, but by the unity of the Taiwanese people and the resolve to never give up. A one-of-a-kind global situation is creating new strategic opportunities for our one-of-a-kind Taiwanese people, bringing new hope. Taiwan’s foundation is solid; its strength is great. So as long as everyone remains steadfast in their convictions, is willing to work hand in hand, stands firm amidst uncertainty, and looks for ways to win within changing circumstances, Taiwan is certain to prevail in the test of our time yet again, for I am confident that there are no difficulties that Taiwan cannot overcome. Thank you.

    MIL OSI Asia Pacific News –

    February 18, 2025
  • MIL-OSI Russia: Sergey Netesov: “You have to root for the positive”

    Translartion. Region: Russians Fedetion –

    Source: Novosibirsk State University – Novosibirsk State University –

    At the popular science marathon “Darwin Week”, a doctor of biological sciences, professor, academician of the Russian Academy of Sciences, head of the laboratory of bionanotechnology, microbiology and virology spoke with a report “Evolution of a set of respiratory infections” Faculty of Natural Sciences of NSU Sergey Netesov.

    Evolution of the virus

    In Russia, doctors register 28 to 33 million cases of acute respiratory infections every year, but these are official statistics. When seeing a patient, the doctor fills out a statistical form, which is sent for processing to the health authorities, where statistical data is collected. However, not everyone comes to see a therapist, especially if the disease is mild, preferring to endure it “on their feet” or use home remedies to fight the infection. Such patients are not included in these statistics. Therefore, experts assume that the actual number of cases exceeds the official data at least twice.

    Acute respiratory infections (ARI) are caused by viruses, bacteria, mycobacteria and mycoplasma. In addition, most likely not all pathogens of ARI in humans have been discovered yet.

    Previously, doctors officially diagnosed ARVI without specifying the pathogen and specifically – influenza viruses, and even then the diagnosis was made by the doctor, guided only by the symptoms observed in the patient, and the laboratory diagnostic methods that existed before the 2000s were lengthy, inaccurate and insensitive. More or less reliable test systems for diagnosing influenza viruses based on the polymerase chain reaction PCR method appeared only in the late 90s, and for diagnosing other pathogens – only in the last 5-10 years. The data from a study of the causes of ARVI using the example of one of the counties of the state of Michigan (USA), published in 2002, surprised epidemiologists: influenza was not in the leading positions – its share was only 9%, while ordinary coronaviruses – 14%, rhinovirus – 34%. Unknown infections then accounted for 23%. Later, metapneumoviruses were identified, and their share in the structure of pathogens was about 10% in the category that was previously designated as “unknown infections.” Common coronaviruses, as a rule, have “overtaken” the flu in the share of infected people in the last 20-30 years, but did not pose a serious danger in the form of fatalities – until SARS-CoV-2 appeared, which took millions of lives around the world. At the initial stage of the pandemic, it posed a very serious danger with a mortality rate of up to 6%, but over time, due to the evolution into much less pathogenic variants, it almost equaled the mortality rate of the common flu – 0.1 – 0.2%.

    — The high mortality rate from the new coronavirus infection was due to vascular thrombosis, which was classified as a circulatory disease at the initial stages of the pandemic, and a cytokine storm — an overly aggressive immune response of the body to a viral infection. It manifests itself in different ways, depending on the chronic diseases of the infected person — in the form of circulatory diseases, pneumonia, complications of type 1 and type 2 diabetes, and sometimes — digestive organs. In the first six months of the pandemic, there were no reliable diagnostics for SARS-CoV-2 markers. Partly due to this, some cases of death from the new coronavirus infection were attributed to serious chronic diseases that the deceased patients suffered from – diseases of the circulatory system, respiratory system, endocrine system, etc. In addition, unlike most respiratory diseases, people died from the new coronavirus not during the first two weeks of the disease, but within a month or two, so it was believed that the patient’s death was the result of complications rather than an acute viral disease, explained Sergei Netesov.

    Over the past few years, the deadly coronavirus has evolved towards changing its antigenic properties and reducing pathogenicity, and is no longer as dangerous in terms of mortality as before. Large-scale vaccination of the population, as well as the immunity formed in those who have recovered, have also had an effect, but in terms of morbidity, this virus still sometimes outpaces the combined influenza viruses A and B, and mortality from it has not been reduced to zero. Last fall, 20-30 people died from Covid every week in Russia. These were mainly elderly people with serious chronic diseases.

    Currently, another pathogen of ARVI, the respiratory syncytial virus, is no less dangerous in terms of severe progression and mortality. In certain periods of the 2023-2024 season, its share in the causes of the overall incidence of ARVI was 40%. Scientists and doctors have long found out that it is one of the main causes of severe pneumonia in children and the elderly. Since last year, trials of vaccines against this virus have begun in the European Union and the United States.

    In the winter of 2024, rhinovirus was the leading cause of acute respiratory viral infections in Russia. It has unpleasant symptoms because it causes inflammation of the nasal sinuses, but does not pose a danger to humans.

    — Only in rare cases is the cause of ARI or ARVI only one pathogen, more often two or three. It often happens that the same patient has one or two ARI pathogens — viral and one — bacterial. In this case, the picture of the disease becomes complex. Viral infections, as a rule, prepare the ground for infection with pathogenic bacteria, — said Sergey Netesov.

    Reliable protection

    To reduce the risk of severe respiratory viral infections, it is necessary to get vaccinated in a timely manner, and it is advisable for people at increased risk of severe acute respiratory infections to wear medical masks in public places. Sergei Netesov also spoke about the influenza vaccines used in Russia. According to him, it is necessary to choose, if possible, four-component drugs with a share of 15 micrograms of antigens of each subtype of the virus. At the same time, the probability of severe disease is reduced by about 20-30 times. And for unvaccinated people, increased risks of severe acute respiratory infections remain for people with impaired immune systems, diabetics and representatives of other risk groups.

    In favor of the effectiveness of masks, Sergei Netesov noted that the mask will not hold a single viral particle, because the size of its pores is too large for this. But viruses in the form of single particles do not fly through the air. They move on microdroplets of fluids in our bodies, released from the body when talking, singing, coughing or sneezing. But these drops have a larger diameter and do not pass through the pores of the mask. And even the most primitive mask holds about 75-80% of such particles, of course, if you cover both your mouth and nose with it. And for infection, the size of the pathogen dose that a person receives is very important. Reducing this dose often leads to zeroing out the infection or getting a very small dose – then the disease does not develop quickly, and the body copes with it much easier.

    The flu virus is constantly evolving, and this process is aimed at an important goal for it – to “break through” the previous immunity and infect as many carriers – susceptible people – as possible.

    In early 2024, several publications were published in the United States stating that cow milk yields in some regions of the country had begun to decline; later, veterinarians identified the H5N1 subtype of avian influenza in them. The influenza virus of this subtype was first isolated not only from birds, but also from some sick people in 1997 in Singapore, Hong Kong, and Vietnam. The virus also affected people, with a very high mortality rate. The reason was soon revealed: in most cases, it was a rare mutation characteristic of the inhabitants of these countries, in which one of the receptors in their lungs turned out to be similar to a similar receptor in birds. This feature is not typical for residents of other countries. And so in 2024, the virus spread not only among birds, but acquired new mutations and “switched” to cattle and more. Several dead cats that had previously drunk cow’s milk were found near the barns with sick cows. The cause of their death, like the illness of the cows on the farm, was the avian influenza virus. And although humans and animals do not have many common infections, this virus has become one of them. It turned out that at the end of 2023, the virus acquired mutations that allowed it to move from birds to cattle. From the beginning of 2024 to February 2025, 68 cases of infection of dairy and poultry workers were noted worldwide. It seems that this flu virus has not yet spread widely, but careful monitoring of its evolution is necessary.

    Race for survival

    Scientists believe that the more common this subtype of the virus becomes, the more likely it is to acquire a combination of mutations that will increase the risk of infection in humans. On the other hand, this subtype of flu has been circulating in various bird species and causing rare sporadic infections in humans for more than two decades, but so far there has been no pandemic. This is one of those cases where a pandemic could start next week or never.

    — Not only pathogens of viral diseases evolve, but also our immune system. It is a kind of race. Therefore, it is necessary to study not only pathogens, but also the parameters of our immunity. Increase the number and effectiveness of vaccines, increase the volume of vaccination. This really improves the quality of life of the population and increases its duration. At the same time, long-term monitoring studies are needed to study the occurrence of pathogens, their molecular genetic diversity and molecular evolution, including drug resistance. Russia has the necessary instrumental and material-reactive bases, including its own high-tech production of many (but not all) modern vaccines and diagnostics. But their wider implementation in practice is required. It is also necessary to develop new vaccines against a number of viral and bacterial pathogens. Unfortunately, so far the diagnostic algorithms in our compulsory insurance medicine have been worked out to a minimum — primarily due to underfunding. But it is possible to distinguish a bacterial infection from a viral one using a very simple test for the content of procalcitonin and some other markers in the blood, said Sergei Netesov.

    The scientist also noted that when fighting a viral disease, regardless of what virus caused it, the patient’s psychological state and the support of loved ones are also important. It is important to be sick in a good mood, then recovery will be faster.

    — You should always be positive when you are sick! A person with a bad emotional background is objectively sicker. You need to look to the future with confidence and optimism and tell your body: “Get well.” The human body is a very complex unified system, where all components influence each other. In this case, you need to establish positive feedback between the body and the brain, try to create a good mood for yourself and, of course, follow all the doctor’s recommendations, — said Sergey Netesov.

    Please note: This information is raw content directly from the source of the information. It is exactly what the source states and does not reflect the position of MIL-OSI or its clients.

    MIL OSI Russia News –

    February 18, 2025
  • MIL-OSI China: Tourist trains gaining popularity among seniors

    Source: China State Council Information Office 2

    Chinese consumers have indicated a growing interest in taking dedicated tourist trains, with rising search volumes related to the sector seen, following the country’s plan to retrofit tourist trains to make them more senior-friendly.
    Specifically, the country plans to launch more green and comfortable travel products and develop more themed routes for the trains, according to a guideline issued on Feb 11 by nine entities, including the Ministry of Commerce, the Ministry of Culture and Tourism and China State Railway Group Co Ltd.
    On Wednesday and Thursday, search volume for travel products related to such tourist trains more than tripled over the same period in January, said Tongcheng Travel, a Suzhou, Jiangsu province-based online travel agency.
    Tourist trains have been one of the most popular travel products among seniors in China. In 2024, nearly 80 percent of consumers who booked tourist trains were aged 60 and above, Tongcheng said.
    Tourist trains connecting Gansu province and the Xinjiang Uygur autonomous region; Heilongjiang province and the Inner Mongolia autonomous region; as well as the China-Laos Railway, have been quite popular among senior travelers, Tongcheng said.
    China has the world’s largest passenger railway network, while the operation of tourist trains in the country is still in its development stage. In 2024, China operated a total of 1,860 tourist trains nationwide, a record high, and the number jumped nearly 50 percent over the pre-pandemic period in 2019, said China Railway.
    “Compared with traditional modes of travel, tourist trains are more comfortable and they satisfy traveler demand for catering, accommodation, transportation and sightseeing, making them more friendly to senior travelers,” said Li Zhun, a senior researcher at the Tongcheng Research Institute.
    “In the next three to five years, demand for cultural and tourism products suitable for senior travelers will further grow in China. Besides raising the supply of tourist train products, there is still room for improvement in the quality of service and operation,” Li said.
    He added that in the next step, tourist trains may be envisioned as a peer to mature business models like luxury cruise ships. More tourist train products suitable for different types of consumers and a new marketing system should be promoted.
    Meanwhile, the domestic tourism market has gradually returned to normalcy after the Spring Festival holiday, and prices of flight tickets and hotels have declined, making it friendly for senior travelers who seek to travel during off-peak periods.
    Tongcheng Travel said after the Spring Festival break, the company has received an increasing number of travel inquiries from senior travelers aged between 55 and 70. Compared with office employees and students, older travelers have more flexible schedules, and they are able to opt for off-peak travel periods to avoid crowds, the company said.
    During off-peak periods, some popular outbound destinations for Chinese travelers include Tokyo, Osaka and Sapporo in Japan; Seoul, South Korea; Bangkok, Thailand; Singapore; New Zealand; and Bali, Indonesia. In addition, cruise tourism products to Japan and South Korea, as well as Mediterranean cruises, have been sought after by consumers, the online travel agency found.

    MIL OSI China News –

    February 18, 2025
  • MIL-OSI USA: Waller, Disinflation Progress Uneven but Still on Track Rates Cuts on Track as Well

    Source: US State of New York Federal Reserve

    Thank you, Bruce, and thank you for the opportunity to speak to you today. It’s great being back in Sydney and seeing old friends—like the Opera House!
    As I look at the U.S. economy today, I see that the real side is doing just fine but progress on lowering inflation has come in fits and starts.1 After two good months of inflation data for November and December, January once again disappointed and showed that progress on inflation remains uneven. I continue to believe that the current setting of monetary policy is restricting economic activity somewhat and putting downward pressure on inflation. If this winter-time lull in progress is temporary, as it was last year, then further policy easing will be appropriate. But until that is clear, I favor holding the policy rate steady.
    Spending by households and businesses has proved to be resilient, we have solid growth in real gross domestic product (GDP) and the latest data on employment, including revisions to most of 2024, support the view that labor market is in a sweet spot. Meanwhile, last week’s January inflation data have a similar feel to that of January 2024, albeit to a smaller degree; they surprised on the high side and raised concerns that the progress we made in pushing inflation toward our 2 percent goal would stall out. But once we got past the first quarter of last year, we did see continued progress in reducing inflation in the latter part of the year. The question now is if we will see progress again later this year, as we did in 2024.
    Progress on inflation is an important consideration in policymakers’ judgment about whether monetary policy needs adjustment in the near term. The continued solid labor market is one reason why I supported the Federal Open Market Committee’s (FOMC) decision at the end of January to hold our policy rate steady. After two good inflation reports for November and December there was concern about a January bounce back in inflation. So based on good labor market data and concerns about a seasonal shock to inflation not fully adjusted in the data, I felt it was prudent to stand pat at our January meeting. Given last week’s inflation report, that concern was warranted.
    Let me pause here for a moment to address some commentary after the FOMC meeting that cited uncertainty about the new Administration’s policies as a leading reason for that decision. We must keep in mind that there is always a degree of uncertainty about economic policy, and we need to act based on incoming data even when facing great uncertainty about the economic landscape. We have done this in the past and will continue to do so in the future.
    Let me provide two recent examples where the FOMC acted in the face of great uncertainty. In March 2022, inflation was roaring, and rate hikes were on the table. Then Russia invaded Ukraine, which created tremendous economic uncertainty around the globe. Not only did the FOMC raise the policy rate in March 2022 for the first time since 2019, but in subsequent meetings we also implemented large rate hikes for several meetings. We could not wait for uncertainty about the war to be resolved.
    The second episode was in March of 2023 when stresses emerged in the U.S. banking system, stemming in part from the failures of Silicon Valley Bank and Credit Suisse, with the latter occurring the weekend before our March FOMC meeting. There was great uncertainty as to whether these events would lead to financial instability and a significant contraction of credit that could trigger a recession. Many forecasters projected a recession would hit in the second half of 2023 as a result. Consequently, there were calls to stop hiking the policy rate due to a tremendous amount of financial and banking uncertainty. But the Federal Reserve worked in concert with other government agencies and used its financial stabilization tools to deal with the banking issues and continued raising the policy rate to deal with inflation.2 So the moral of this story is that monetary policy cannot be put on hold waiting for these types of uncertainty to resolve.
    Putting uncertainty aside, let me turn to my view of the economic data. As I noted, real GDP continued to grow solidly in the fourth quarter, at a pace of 2.3 percent, and would have been nearly 1 percentage point stronger without a reduction in inventories, which tend to be volatile. Personal consumption expenditures (PCE), which are typically two-thirds of GDP, grew a robust 4.2 percent in the fourth quarter. As was noted in the Fed’s latest Monetary Policy Report to Congress, households have a solid level of liquid assets to sustain their spending. Based on the limited data we have for the first quarter of 2025 this solid growth seems to be continuing. The employment report for January, which I will focus on in a moment, indicated a continued strong labor market, which should support consumption. Retail sales are reported to have fallen back in January after a strong rise in December, but given how volatile these data can be, and given that the cold weather in January probably held down sales, I’m not putting much weight on that reading for the time being. Business sentiment, as reflected in surveys of purchasing managers in both manufacturing and non-manufacturing, was among the most consistently positive in a while. The index for manufacturing businesses was 50.9, the first time since October 2022 that these results topped 50, as sentiment indicators about orders, production, and employment were all expanding. The corresponding index for the large majority of businesses outside manufacturing also indicated expansion, as it has for some time. The Blue Chip consensus of private forecasters and the Atlanta Fed’s GDP Now forecast based on the data in hand predict growth this quarter similar to that of the end of last year. To circle back to my message earlier, many people predicted that tariffs proposed by the Administration on February 1 would have a significant effect on trade and consumption in the first quarter, not to mention prices, but after the postponement of some of those tariffs, it is unclear to me if and when that might show up in the data. I will, of course, be watching closely, but I haven’t altered my outlook based on what has been implemented to date.
    As I noted earlier, data on the labor market indicate that it is in a good spot, with employers having an easier time filling jobs than earlier in the expansion but with still ample demand for new workers and new jobs being created. The unemployment rate ticked down to 4 percent, which is just about where it has been for the past year. Employers added a net 143,000 jobs in January, down some from a 204,000 average for the final three months of 2024 but right around the 133,000 average for the quarter before that. Two factors that may have held down this number a bit were cold weather and the fires in Los Angeles, which prevented thousands of people from getting to or performing their jobs. Beyond payrolls, the ratio of job vacancies to the number of unemployed people stands at 1.1, close to the level before the pandemic.
    Wage growth continues to be strong, and it has considerably outpaced price increases, but is down from two years ago, and for a few reasons, I don’t judge recent data as indicating that wages are a factor preventing inflation from making continued progress toward 2 percent. Though the January reading of average hourly earnings was a bit elevated, this series is pretty volatile and the reading may have been held up by weather-related issues. Smoothing through the monthly fluctuations, we see wage growth fairly steady at 4 percent a month over the past year. Broader measures of worker compensation show a more distinct moderation in growth. The Labor Department’s employment cost index has fallen gradually but consistently from 4.2 percent at the end of 2023 to 3.8 percent at its last reading.
    As for whether 4 percent wage growth is consistent with 2 percent inflation, I will note, as I have before, that productivity has grown at roughly a 2 percent annual rate since the advent of the pandemic—and slightly faster than that in 2023 and 2024. Unless that productivity trend changes a lot, wage growth is consistent with bringing inflation down to 2 percent.
    Turning to inflation, last week’s data taken as a whole were mildly disappointing but not nearly so disappointing as a focus on the consumer price index (CPI) alone would have indicated. Total CPI inflation for January came in hot at 0.5 percent, and core was 0.4 percent, which brings the 12-month changes to 3.0 percent and 3.3 percent, respectively. These 12-month readings are lower than we had in January 2024, so we have made some progress over the past year, but they are still too high.
    However, we also received producer price data last week, and, combining that information with the CPI data, forecasts for January PCE inflation aren’t as alarming as the CPI inflation data. Estimates for total PCE inflation, the FOMC’s preferred measure, are about 0.3 percent and that for core PCE inflation was around 0.25 percent. These numbers will mean a bump-up in the monthly pace of core inflation of about one-tenth of 1 percentage point from readings of under 0.2 percent in November and December. And this would leave the 12-month and 6-month average core PCE inflation around 2.6 percent and 2.4 percent, respectively. These rates are lower than where they stood in January 2024, which is good, but progress has been slower than I expected on reducing inflation to our 2 percent target.
    As a policymaker, I rely on these data to help me judge how close we are to meeting our inflation target. And I’m thinking hard about how to interpret these recent numbers because there seems to be some pattern over the past few years of higher inflation readings at the start of the year. This pattern brings into question whether the inflation data have “residual seasonality,” which means that statisticians have not fully corrected for some apparent seasonal fluctuations in some prices. Many firms reset their prices at the beginning of each year, and the Commerce Department tries to factor this in, but even after this adjustment, there is a consensus among economists that some seasonality remains. Incidentally, this probably isn’t just a problem in January. Some recently updated research by the Fed staff shows that inflation in the first months of the year has been higher than in the second half for 16 of the last 22 years.3 I’m alert to this issue and will watch the data over the next few months to evaluate if we are having what looks like a repeat of high first quarter inflation data that could be followed by lower readings later in the year.
    Before I get to my outlook for monetary policy, I want to address a topic of some debate recently, which is the divergence between long-term interest rates and the FOMC’s policy rate since we started cutting rates in September. While the FOMC has reduced the policy rate 100 basis points since then, yields on the benchmark 10-year Treasury security have increased by a noticeable amount. In theory, longer-term rates should follow the expected path of the overnight policy rate set by the FOMC. But this relationship is based on the classic economic assumption of ceteris paribus, or “all other factors remaining constant.” The 10-year Treasury security trades in a deep, liquid global market, and its yield is affected by a variety of factors other than the path of the policy rate. This means that all other factors are not constant and that the 10-year Treasury yield may not follow the federal funds rate.
    Perhaps the most famous example of the divergence of market interest rates and policy rates began in the mid 2000’s. The FOMC was tightening monetary policy from 2004 to 2006 and raised the policy rate 425 basis points. Over that time, Treasury yields barely moved. This was so surprising that Fed Chairman Alan Greenspan referred to it as a “conundrum.” At about the same time, future Chair Ben Bernanke identified what he called a “global savings glut” that was pushing up foreign demand for Treasury securities and putting downward pressure on yields. Over time, this has come to be seen as a significant factor for the conundrum then and as a factor for low Treasury yields subsequently. This example is just to illustrate that the 10-year Treasury yield may not respond to the policy rate as expected because of a variety of factors that are beyond the control of the FOMC.
    So, what does my economic outlook mean for monetary policy? The labor market is balanced and remarkably resilient. If you want an example of a stable labor market with employment at its maximum level, it looks a lot like where we are right now. On the other side of the FOMC’s mandate, inflation is still meaningfully above our target, and progress has been excruciatingly slow over the last year. This tells me that we should currently have a restrictive setting of policy, as we do—to continue to move inflation down to our goal—but that setting should be getting closer to neutral as inflation moves closer to 2 percent and should allow the labor market to remain in a good place.
    So for now, I believe a pause in rate cuts is appropriate. Assuming the labor market continues to be in rough balance, I can wait and see if the higher inflation readings in January moderate, as they have in the past couple of years. If so, I’ll have to decide if this reflects residual seasonality that will go away later in the year and if the underlying trend in inflation is toward 2 percent, or if there is a different issue holding up inflation and how that may play out. Whichever case it may be, the data are not supporting a reduction in the policy rate at this time. But if 2025 plays out like 2024, rate cuts would be appropriate at some point this year.
    And while we are waiting on data to understand how the economy is moving relative to our objectives, we will learn more about Administration policies. My baseline view is that any imposition of tariffs will only modestly increase prices and in a non-persistent manner. So I favor looking through these effects when setting monetary policy to the best of our ability. Of course, I concede that the effects of tariffs could be larger than I anticipate, depending on how large they are and how they are implemented. But we also need to remember that it is possible that other policies under discussion could have positive supply effects and put downward pressure on inflation. At the end of the day, the data should be guiding our policy action—not speculation about what could happen. And if the incoming data supports further rate cuts or staying on pause, then we should do so regardless of how much clarity we have on what policies the Administration adopts. Waiting for economic uncertainty to dissipate is a recipe for policy paralysis.

    1. The views expressed here are my own and are not necessarily those of my colleagues on the Federal Reserve Board or the Federal Open Market Committee. Return to text
    2. See my March 2022 speech for a discussion of how the Federal Reserve oversees financial stability and macroeconomic stability using different tools. Speech by Governor Waller on the economic outlook – Federal Reserve Board. Return to text
    3. For a fuller discussion of residual seasonality in inflation data, see Ekaterina Peneva and Nadia Sadée (2019), “Residual Seasonality in Core Consumer Price Inflation: An Update,” FEDS Notes (Washington: Board of Governors of the Federal Reserve System, February 12). Return to text

    MIL OSI USA News –

    February 18, 2025
  • MIL-OSI Australia: Growth in demand for domestic flights outstrips seating capacity, leading to fuller flights

    Source: Australian Competition and Consumer Commission

    Virgin Australia and Jetstar reported strong passenger demand growth throughout most of 2024, which continued into the Christmas period, the ACCC’s latest Domestic Airline Competition report has found.

    Compared to December 2023, the number of domestic passengers flown by Virgin Australia in December 2024 increased by 15.8 per cent, while Jetstar’s passengers grew by 11.2 per cent. The number of passengers flown by Qantas increased by 3.2 per cent over the same period.

    “Despite some airlines increasing their seating capacity throughout the year, this was outstripped by the growth in passenger numbers, leading to fuller flights,” ACCC Commissioner Anna Brakey said.

    The report found that flights were fuller than they have been for some time. In November 2024, flights on services between metropolitan cities were 90.4 per cent full. This was the highest rate recorded since at least January 2019, the earliest month for which the ACCC has data.

    “While we recognise that delivery delays for new aircraft have presented significant challenges, we encourage all airlines to find other ways to increase their seating capacity to cater to the growing passenger demand.”

    Cancellation rates improve but flight delays continue

    The industry cancellation rate improved in December 2024, when 1.8 per cent of flights were cancelled. This was the third time in four months that the cancellation rate was better than the long-term average (2.2 per cent).

    The improved cancellation rate is primarily associated with Virgin Australia, which cancelled just 0.6 per cent of flights in December 2024. Qantas had the highest cancellation rate in December 2024, at 2.7 per cent.

    “Flight cancellations have been a real concern for passengers since the pandemic, so it is pleasing to see the improved performance in recent months by some airlines,” Ms Brakey said.

    “Virgin Australia, in particular, has reduced the frequency of cancellations across its network.”

    Airline cancellation rates – December 2022 to December 2024

    Source: BITRE, On-time performance time series – December 2024. Qantas figures include QantasLink and Virgin Australia figures include VARA.

    Note: A flight is regarded as a cancellation if it is cancelled or rescheduled less than 7 days prior to its scheduled departure time.

    While travellers experienced fewer cancellations, they continued to face flight delays, with the on-time arrival rate across all airlines being 74.7 per cent in December 2024.

    Rex had the most reliable on-time performance in December 2024, when 75.9 per cent of its flights arrived on time. Jetstar reported the worst on-time performance with 73.3 per cent of flights arriving on time.

    Airfares stabilise following a peak over October and November

    Average airfares across all fare types stabilised in December 2024 and were 3.0 per cent lower than what they were in December 2023. The fall in average revenue per passenger in December was more pronounced on major city routes (-4.4 per cent) than regional (-0.4 per cent) and remote (-2.3 per cent) routes.

    “Travellers had some relief from high airfares in December, after school holidays and other factors pushed up the average price of domestic travel in October and November,” Ms Brakey said.

    “The reduction in airfares is likely to have primarily benefitted business travellers, as high demand for leisure travel over the Christmas period often leads to a spike in the price of ‘best discount’ tickets.”

    Index of real average fare revenue per passenger – December 2019 to December 2024

    Source: ACCC calculations using data from the ABS and data collected by the ACCC from Bonza (up to March 2024), Jetstar, Qantas, Rex and Virgin Australia.

    Note: (1) Average revenue per passenger includes both economy and business fare revenue. It excludes data associated with ancillaries, such as baggage fees, fees for seat selection and food and drink sold on board. (2) Data has been adjusted for inflation using ABS CPI quarterly data up to December 2024. (3) Grey bars indicate December and Easter holiday periods.

    Changes to domestic airline competition over the past 30 years

    This quarter’s report includes an analysis of the state of competition in Australia’s domestic airline sector over the past 30 years.

    The industry’s competitive landscape has fluctuated throughout this time, and the report highlights how consumers have benefited during periods when there was stronger competition.

    Timeline of domestic aviation since 1990

    The report observed fierce competition in the early 2010s, when Virgin Blue rebranded to Virgin Australia to better compete with Qantas for business travellers. During this time, both airlines competed vigorously for market share by raising capacity and reducing airfares.

    At the same time, Tiger and Jetstar competed for the budget leisure customer segment of the domestic market.

    This competitive rivalry between the airlines declined in the mid-2010s, when Virgin Australia and Qantas abandoned their price war after incurring significant financial losses.

    At around the same time, service reliability began to worsen, as the average industry cancellation rate grew significantly over the next decade. In 2014, the average cancellation rate was above 2.0 per cent for just one month of the year, compared to nine months out of 12 in 2024.

    “Improved competition in the domestic airline industry is essential to ensure consumers can enjoy lower airfares, better service quality and more choice,” Ms Brakey said.

    Background

    On 6 November 2023, the Treasurer directed the ACCC to recommence domestic air passenger transport monitoring. Under this direction the ACCC is to monitor prices, costs and profits relating to the supply of domestic air passenger transport services for a period of three years and to report on its monitoring at least once every quarter.

    The ACCC collects data from Jetstar, Qantas, Rex and Virgin Australia for monitoring purposes.

    Rex entered voluntary administration in July 2024 but continues to operate its regional routes. The government is guaranteeing regional flight bookings for Rex customers throughout the voluntary administration process.

    MIL OSI News –

    February 18, 2025
  • MIL-OSI New Zealand: Popular Great Walks bookings to open

    Source: Department of Conservation

    Date:  18 February 2025

    Opening dates are staggered between 13 to 28 May to give people making multiple bookings a better chance of securing their preferred slot. 

    DOC has upgraded the booking system, so it is easier for people to use. This includes implementing a queue system on opening days, to smooth the experience for customers and to better manage very high demand at peak times.

    “New Zealand’s Great Walks are hugely popular both here and internationally. They offer diverse multi-day experiences across spectacular landscapes, on well-formed and maintained tracks,” says Director of Heritage and Visitors Cat Wilson.

    “Our newest Great Walk – Hump Ridge Track was recently named on a list of ‘Top 25 trails to explore around the globe in 2025’, the only walk to feature from Oceania.”

    “Around 50% of international visitors come here to experience our national landscapes and environment, and around 50% of international tourists visit New Zealand’s national parks”.

    The Heaphy, Kepler and Rakiura tracks are the first Great Walks to open on 15 May, Hump Ridge Track will open at the same time. The ever-popular Milford Track will open last on 28 May. DOC recommends people wanting to book a Great Walk have a profile set up before opening day.  

    The Great Walks mythbuster postexplains why some Great Walks book out faster than others.

    Bookings for other DOC accommodation will also open in this period, from 13 to 21 May. Bookings go live at 9:30am on the opening day.

    “It’s been a busy summer to date and it’s great seeing more people are enjoying Great Walks, with bookings up 5% on the previous year,” says Director of Heritage and Visitors Cat Wilson.

    “So far, 67% of all Great Walk bednights* booked were by New Zealanders, up from 60% pre-pandemic and 65% last summer. In all, New Zealanders booked over 45,000 bednights on the Great Walks between 15 December 2024 and 26 January 2025.”

    “We’re lucky to have mountains, forests, beaches, parks, lakes and rivers on our doorstep. With demand for spots on some of our Great Walks still very high, people should consider some of the less well-known walks which are just as spectacular”, says Cat Wilson.

    *One bednight = one person taking one berth/space for one night. Bednights are a standard reporting metric used across the global tourism industry.

    Background information

    Opening dates for Great Walk accommodation bookings (for stays from 1 July 2025 – 30 June 2026) 9.30 am NZST

    15 May – Heaphy Track, Kepler Track, Rakiura Track, Hump Ridge

    22 May – Whanganui Journey, Routeburn Track, Tongariro Northern Circuit

    27 May – Lake Waikaremoana Track, Abel Tasman Coast Track, Paparoa Track

    28 May – Milford Track

    Opening dates for all other accommodation bookings (for stays from 1 July 2025 – 30 June 2026) 9.30am NZST

    13 May – Backcountry huts, lodges, sole occupancy facilities

    20 May – Conservation campsites, except Tōtaranui, Momorangi, Anaura Bay campsites

    21 May – Momorangi campsite, Anaura Bay campsite

    4 June – Tōtaranui campsite 

    Contact

    For media enquiries contact:

    Email: media@doc.govt.nz

    MIL OSI New Zealand News –

    February 18, 2025
  • MIL-Evening Report: Australians are waiting 12 years on average before seeking help for a mental health problem – new research

    Source: The Conversation (Au and NZ) – By Louise Birrell, Researcher, Matilda Centre for Research in Mental Health and Substance Use, University of Sydney

    Pixel-Shot/Shutterstock

    Australians are waiting an average of 12 years to seek treatment for mental health and substance use disorders, our new research shows.

    While many of us are proactive in looking after our physical health, we appear to be seriously neglecting our mental health, suffering for many years before reaching out for help. Some people never seek help.

    In our research, the length of delay in seeking help varied depending on the type of mental health problem and other factors such as sex and age.

    But delays in getting help mean mental health problems can become more complex, severe and difficult to treat. So it’s important to understand why these delays occur – and how we can reduce them.

    Some key findings

    We used national data from the 2020–22 Australian National Study of Mental Health and Wellbeing, a nationally representative survey by the Australian Bureau of Statistics (ABS).

    Among the information collected in this survey, respondents were asked about their history of mental health and substance use problems, and when they first sought help from a medical doctor or other professional regarding their symptoms (if at all).

    The survey asked about the most common types of mental health and substance use problems in the general population under three broad categories: mood disorders (for example, depression and bipolar disorder), anxiety disorders (such as social anxiety disorder and obsessive compulsive disorder) and substance use disorders.

    People with mood disorders waited an average of three years before seeking treatment, those with substance use disorders waited an average of eight, and people with anxiety disorders waited the longest to seek treatment – 11 years on average.

    We found people experiencing panic disorder, a type of anxiety disorder, had some of the shortest delays (an average of two years), while those with social anxiety disorder waited the longest (13 years).

    The average delay across all mental health and substance use disorders – 12 years – was calculated based on the prevalence of different conditions. Anxiety disorders, particularly social anxiety disorder, are the most common, which brought up this average.

    We found younger people were more likely to seek help.
    Perfect Wave/Shutterstock

    We also looked at how many people would eventually seek help across their lifetime. Nearly everyone with depression (94%) eventually sought help, but only 25% of people with an alcohol use disorder ever did.

    Women were less likely than men to seek help for alcohol or other drug-related problems but were more likely to reach out for help with anxiety or mood-related concerns.

    Gen Z and millennials were much more likely to seek help than older generations. Compared to people born before 1972, those born between 1992 and 2005 were more than four times as likely to seek treatment for a drug or alcohol problem, more than twice as likely to seek help for a mood disorder, and nearly four times as likely to seek help for an anxiety problem.

    Some limitations

    While the ABS survey is one of the largest and most comprehensive in Australia, it relies on people remembering and accurately reporting when they first experienced symptoms of a mental health or substance use problem, and when they first sought support.

    It was also conducted during the COVID pandemic, a time of heightened stress and increased mental health challenges. However, the impact of this is probably small, given people were asked about their experiences across their entire lifetime.

    The survey also didn’t measure less common (but very impactful) mental health problems such as psychosis or eating disorders.

    How do delays compare to other countries?

    While this data is not perfect, the delays we observed are mostly in line with those seen in other countries. In some ways we are actually doing better.

    The relatively short delays for seeking help for a mood disorder (for example, depression, for which the average delay was three years) are largely consistent with similar studies in the United States, New Zealand, Europe and Asia.

    It’s often several years between when someone first experiences a mental health problem and when they seek treatment.
    Erik Mclean/Unsplash

    While still lengthy, the average delay of 11 years to seek treatment for an anxiety disorder in Australia appears similar if not shorter than in many other countries (ranging between 10–30 years).

    What’s more, when it comes to seeking help for problems with alcohol, things seem to be improving. While overall delays remain long, and most people still don’t seek help for alcohol problems, the delay in getting help appears to have shortened over time in Australia.

    The average time to seek treatment for alcohol use disorder is now eight years shorter than the 18-year delay reported in 2007. This may be due to increased awareness and education around the impact of alcohol use.

    Why do people delay reaching out for help?

    There are a range of reasons someone may delay seeking help. Services are not always available and many carry high out-of-pocket costs. Fear and stigma play a significant role, while many people simply may not know where to seek support or what might help.

    Finding the right treatment can be hard and while some people recover without help, for many these delays come at a huge cost. Delays mean problems can become more complex, severe and difficult to treat.

    We need to actively encourage early help-seeking, as well as continue efforts to reduce the stigma associated with poor mental health. Expanding anti-stigma campaigns and education to encourage people to seek help early could assist with this.

    Alongside these efforts it’s essential that effective treatment services are accessible when people do reach out for help. There has been chronic underinvestment in the mental health treatment system over many decades, while prevalence rates have increased. We need continued and increased investment in mental health treatment, prevention and early intervention.

    Ultimately, by empowering future generations to be proactive about their mental health, we hope we can make going to the doctor for anxiety as normal as doing so for the flu.

    Services available across Australia include the National Alcohol and Other Drug hotline (1800 250 015), Lifeline (13 11 14), Kids Helpline (1800 55 1800) and Head to Health. Each state and territory also has specialised mental health services.

    Louise Birrell receives funding from The National Health and Medical Research Council and The Australian Government Department of Health and Ageing.

    Cath Chapman receives funding from The National Health and Medical Research Council and The Australian Government Department of Health and Ageing.

    Katrina Prior receives funding from the National Health and Medical Research Council.

    – ref. Australians are waiting 12 years on average before seeking help for a mental health problem – new research – https://theconversation.com/australians-are-waiting-12-years-on-average-before-seeking-help-for-a-mental-health-problem-new-research-249159

    MIL OSI Analysis – EveningReport.nz –

    February 18, 2025
  • MIL-OSI Africa: African Development Bank: New report highlights Africa’s strengthening economic growth amid global challenges

    Source: Africa Press Organisation – English (2) – Report:

    ABIDJAN, Ivory Coast, February 17, 2025/APO Group/ —

    • Growth rates above 5 percent expected in close to half of the continent’s countries in 2025; 12 of world’s 20 fastest growing economies will be African

    Africa’s economic performance is showing signs of improvement but remains vulnerable to global shocks, according to the 2025 Macroeconomic Performance and Outlook (MEO) report released by the African Development Bank (www.AfDB.org/en) on Friday.

    The report, unveiled on the sidelines of the 38th Ordinary Session of the African Union Assembly in Addis Ababa, projects real GDP growth to accelerate to 4.1 percent in 2025 and 4.4 percent in 2026. The forecast is attributed to economic reforms, declining inflation, and improved fiscal and debt positions.

    Despite the positive trajectory, the report highlights that Africa’s growth remains below the 7 percent threshold required for substantial poverty reduction. The continent also continues to grapple with geopolitical tensions, structural weaknesses, climate-related disasters, and prolonged conflicts in regions such as the Sahel and the Horn of Africa. It estimated Africa’s average real GDP growth to be 3.2 percent in 2024, slightly higher than the 3.0 percent recorded in 2023.

    The report notes that while inflationary pressures persist, Africa’s average inflation rate is expected to decline from 18.6 percent in 2024 to 12.6 percent in 2025-2026 due to tighter monetary policies. Fiscal deficits have widened slightly from 4.4 percent of GDP in 2023 to 4.6 percent in 2024 but are projected to narrow to 4.1 percent by 2025-2026. Public debt levels have stabilized but remain above pre-pandemic levels, with nine countries in debt distress and eleven at high risk of distress.

    The MEO, published by the Bank biannually in the first and fourth quarters, responds to a critical need for timely economic data amid global uncertainty. It serves policymakers, development partners, global investors, researchers, and other stakeholders.

    The 2025 report identifies 24 African nations, including Djibouti, Niger, Rwanda, Senegal, and South Sudan, as poised to exceed 5 percent GDP growth in 2025. Additionally, Africa remains the world’s second-fastest-growing region after Asia, with 12 of the 20 fastest-growing economies projected to be on the continent.

    Ethiopia’s Finance Minister, Ato Ahmed Shide, praised the report’s depth of analysis. “It underscores the fragility of Africa’s economic growth, which is projected to hover around 4 percent in the near term,” he said, emphasizing the need for proactive policy measures to sustain growth and stability. 

    He said Ethiopia has taken bold steps to restore macroeconomic stability, build resilience, and accelerate growth, with the government prioritizing economic liberalization, private sector empowerment, and fiscal discipline.

    Strengthening Africa’s Resilience

    In her remarks at the report’s launch, Nnenna Nwabufo, Vice President for Regional Development, Integration, and Business Delivery at the African Development Bank, highlighted the continent’s potential for driving global economic expansion but said achieving this requires decisive and well-coordinated policies.

    “As Africa navigates an increasingly complex economic landscape, policymakers must adopt a forward-looking approach to reinforce resilience and drive sustainable growth. Africa’s economic resilience and growth prospects remain strong, but challenges persist,” said Nwabufo, who represented the Bank Group’s President, Dr. Akinwumi Adesina.

    Presenting the report, Prof. Kevin Urama, the Bank Group’s Chief Economist and Vice President for Economic Governance & Knowledge Management, underscored the need for stronger coordination between monetary and fiscal policies to manage inflation while fostering economic expansion.

    He urged countries to strengthen foreign reserves to shield economies from external shocks and currency depreciations, alongside pre-emptive debt restructuring to prevent defaults and enhance financial stability.  

    Medium- to long-term strategies should include increasing investments in integrated infrastructure to drive economic transformation and diversification. Governments must work to enhance the business environment through regulatory reforms and long-term strategies to attract private investment, Urama said.

    The 2025 MEO report outlines key policy recommendations, including implementing pre-emptive debt restructuring to enhance financial stability, investing in integrated infrastructure to support economic diversification and improving the business environment through regulatory reforms and investment strategies.

    Path Forward

    Panel discussions following the report’s launch underscored the importance of fully implementing continental development initiatives such as the African Continental Free Trade Area agreement. Discussions also focused on accelerating new initiatives like the proposed Africa Credit Rating Agency and the African Financial Stability Mechanism.

    The panel, moderated by Dr Victor Oladokun, Senior Advisor (Communications and Stakeholder Engagement) to the Bank Group President, included contributions from the African Risk Capacity Group, represented by its chair, Dr. Mothae Maruping. Gambian Finance Minister Seedy Keita highlighted the African Development Bank’s support in implementing the country’s fiscal reforms and domestic revenue mobilization.

    African Union Trade Commissioner Albert Muchanga called on the private sector to do more to support the African Continental Free Trade Area, including through increased investments in logistics and manufacturing. “What I would expect [African businesses] to do is come up with logistics centers and warehouses across Africa; I would also expect the African private sector to start planning to develop an African shipping line… We are sitting on potential; the business sector has not responded,” Muchanga said.

    Click here (https://apo-opa.co/3CYp6fd) for the 2025 MEO report.

    MIL OSI Africa –

    February 18, 2025
  • MIL-OSI USA: Bowman, Brief Remarks on the Economy and Accountability in Supervision, Applications, and Regulation

    Source: US State of New York Federal Reserve

    Thank you for the invitation to join you here in Phoenix at the ABA’s Conference for Community Bankers.1 For the past seven years, this conference provided an excellent forum for me and bankers to meet and interact with a range of state and federal regulators, policymakers, service providers, and other stakeholders. Today I would like to share a brief update on my views on monetary policy and the economy, before I turn to bank regulatory issues, and describe how I think that regulators should approach the important work of “maintenance” of the regulatory framework.
    Economic Outlook and Monetary PolicyToward the end of last year, the Federal Open Market Committee (FOMC) began the process of moving the target range for the federal funds rate to a more neutral setting to reflect the progress made since 2023 on lowering inflation and cooling the labor market. At our September meeting, the FOMC voted to lower the target range, for the first time since we began tightening monetary policy to combat inflation, by 50 basis points to 4-3/4 to 5 percent.
    You may remember that I dissented from that decision, the first time a Fed Governor dissented from an FOMC rate decision in nearly 20 years. I preferred a smaller initial cut to begin the policy recalibration phase. I explained my reasoning in a statement published after the meeting noting that the strong economy and a healthy labor market did not warrant a larger cut. In addition, moving the policy rate down too quickly could unnecessarily risk stoking demand, potentially reigniting inflationary pressures, and could be interpreted as a premature “declaration of victory” on our price-stability mandate.
    At the most recent FOMC meeting last month, my colleagues and I voted to hold the federal funds rate target range at 4-1/4 to 4‑1/2 percent and to continue to reduce the Federal Reserve’s securities holdings. I supported this action because, after recalibrating the policy rate by 100 basis points through the December meeting, I think that policy is now in a good place, allowing the Committee to be patient and pay closer attention to the inflation data as it evolves.
    In my view, the current policy stance also provides the opportunity to review further indicators of economic activity and get further clarity on the administration’s policies and their effects on the economy. It will be very important to have a better sense of these policies, how they will be implemented, and establish greater confidence about how the economy will respond in the coming weeks and months.
    For now, the U.S. economy remains strong, with solid growth in economic activity and a labor market near full employment. Core inflation is still somewhat elevated, but has appeared to resume its downward path, and my baseline expectation has been that it will moderate further this year. Even with this outlook, there are upside risks to my baseline expectation for the inflation path.
    In 2023, the rate of inflation declined significantly, but it has taken longer to see further meaningful declines since that time. The latest consumer and producer price index reports suggest that the 12-month measure of core personal consumption expenditures inflation—which excludes food and energy prices—likely moved down to around 2.6 percent in January, which would represent a noticeable stepdown from its 2.8 percent reading in December and 3.0 percent at the end of 2023. Progress had been especially slow and uneven since the spring of last year mostly due to rising core goods price inflation.
    After increasing at a solid pace, on average, over the first nine months of last year, gross domestic product appears to have risen a bit more moderately in the fourth quarter, reflecting a large drop in the volatile category of inventory investment. In contrast, private domestic final purchases, which provide a better signal about underlying growth in economic activity, maintained its strong momentum from earlier in the year, as personal consumption rose robustly again in the fourth quarter. Following strong readings in December, retail sales and sales of motor vehicles softened in January. However, these data can be noisy around this time of the year and sales were likely affected by the cold and wintery weather last month.
    Payroll employment gains have picked up since the summer of last year and averaged a strong pace of about 240,000 per month over the past three months, with last month’s gains likely held back by the Los Angeles wildfires and the harsh winter weather. The unemployment rate edged down further to 4.0 percent in January and has moved sideways since the middle of last year, remaining below my estimate of full employment.
    The labor market appears to have stabilized in the second half of last year, after it loosened from extremely tight conditions. The rise in the unemployment rate since mid-2023 largely reflects weaker hiring, as job seekers entering or re-entering the labor force are taking longer to find work, while layoffs have remained low. The ratio of job vacancies to unemployed workers has remained close to the pre-pandemic level in recent months, and there are still more available jobs than available workers. The labor market no longer appears to be especially tight, but wage growth remains somewhat above the pace consistent with our inflation goal.
    The recent revision of the Bureau of Labor Statistics labor data further vindicates my view that the labor market was not weakening in a concerning way during the summer of last year. Although payroll employment gains were revised down considerably in the 12 months through March 2024, job gains were little revised, on net, over the remainder of last year. It is crucial that U.S. official data more accurately capture structural changes in labor markets in real time, so we can confidently rely on these data for monetary and economic policymaking. But in the meantime, given conflicting economic signals, measurement challenges, and significant data revisions in recent years, I remain cautious about taking signal from only a limited set of real-time data releases.
    Assuming the economy evolves as I expect, I think that inflation will slow further this year. As the inflation data since the spring of last year show, its progress may be bumpy and uneven, and progress on disinflation may take longer than we would hope. I continue to see greater risks to price stability, especially while the labor market remains strong.
    With encouraging signs that geopolitical tensions may be abating in the Middle East, Eastern Europe, and in Asia, I will be monitoring global supply chains which could continue to be susceptible to disruptions, and lead to inflationary effects on food, energy, and other commodity markets. In addition, the release of pent-up demand following the election could lead to stronger economic activity, which could also influence inflationary pressures.
    Having entered a new phase in the process of moving the federal funds rate toward a more neutral policy stance, there are a few considerations that lead me to prefer a cautious and gradual approach to adjusting policy, as it provides us time to assess progress in achieving our inflation and employment goals.
    Given the current policy stance, I think that easier financial conditions from higher equity prices over the past year may have slowed progress on disinflation. And I am watching the increase in longer-term Treasury yields that has occurred since the start of policy recalibration at the September meeting. Some have interpreted it as a reflection of investors’ concerns about inflation risks and the possibility of tighter-than-expected policy that may be required to address inflationary pressures.
    There is still more work to be done to bring inflation closer to our 2 percent goal. I would like to gain greater confidence that progress in lowering inflation will continue as we consider making further adjustments to the target range. We need to keep inflation in focus while the labor market appears to be in balance and the unemployment rate remains at historically low levels. Before our March meeting, we will have received one additional month of inflation and employment data.
    Looking forward, it is important to note that monetary policy is not on a preset course. At each FOMC meeting, my colleagues and I will make our decisions based on the incoming data and the implications for and risks to the outlook and guided by the Fed’s dual-mandate goals of maximum employment and stable prices. I will also continue to meet with a broad range of contacts to help me interpret the signals provided by real-time data and as I assess the appropriateness of our monetary policy stance.
    Bringing inflation in line with our price stability goal is essential for sustaining a healthy labor market and fostering an economy that works for everyone in the longer run.
    Maintenance of the Regulatory FrameworkI will now turn to bank supervision, the bank applications process, and regulation. Community banks experience the burden of the regulatory framework most acutely when it is not appropriately tailored to their size, risk, complexity, and business model. While promoting safety and soundness in the banking system—particularly among community banks—is an important and necessary regulatory objective, we must also be cautious to ensure that the framework does not become an impediment to their operations, preventing them from providing competitive products and services, innovating, and engaging in appropriate risk-taking.
    During my tenure at the Board, I have laid out a wide range of issues and concerns that I see as critical components that are necessary to build and maintain an effective regulatory framework.2 While I will only address a subset of these issues today, I’d like to begin by clarifying what I mean by this.
    Our work to maintain an effective framework is never really complete. Just as complacency can be fatal to the business of a bank, complacency can also prevent regulators from meeting their statutory obligation to promote a safe and sound banking system that enables banks to serve their customers effectively and efficiently.
    System maintenance is not something that we should shy away from. In our everyday lives, we invest significant time in maintenance. We schedule regular oil changes for our cars, and we invest in the infrastructure that allows our economy to function. Devoting resources to maintenance often prevents more costly issues down the road—it’s easier to get oil changes than it is to rebuild an engine.
    So, what does maintenance look like in practice? To address this question, I think it’s helpful to look at three core areas in the bank regulatory framework: Supervision, Bank applications, and Regulation.
    Approach to SupervisionLet’s start with supervision. Supervision operates almost entirely outside of the public view. Much of the work involves the review of proprietary business information from banks, and the preparation of examination reports shielded from public scrutiny under the auspices of protecting confidential supervisory information. But confidentiality should not be used to prevent scrutiny and accountability in the assignment of ratings.
    So, today, I am going to dig a bit deeper into the realm of supervision to discuss supervisory ratings, accountability, and the troubling trend of inaction and opacity within the supervisory toolkit.
    Rational Standards & RatingsWhile there is some public disclosure of supervisory information, it is often difficult to get a true understanding of supervision based on data that may be released. In fact, this data often sends confusing and conflicting signals. For example, the Board’s Supervision and Regulation Report presented information stating that only one-third of large financial institutions maintained satisfactory ratings across all relevant ratings components in the first half of 2024.3 At the same time, this report noted that most large financial institutions met supervisory expectations with respect to capital and liquidity.4
    The odd mismatch between financial condition and overall supervisory condition as assessed by the prudential regulators raises a more significant issue, whether subjective examiner judgment—those evaluations based on subjective, examiner-driven, non-financial concerns—is driving the firm’s overall rating. Are ratings trends based on the materiality of the identified issues, or do they imply that the regulators see widespread fragility in the banking system?
    While this example highlights a large bank ratings framework issue, it is symptomatic of a broader issue that warrants scrutiny—whether the approach to supervision has led to a world in which core financial risks have been de-prioritized, and non-core and non-financial risks—things like IT, operational risk, management, risk management, internal controls, and governance—have been over-emphasized. These issues are important, and certainly worthwhile topics for examiners to consider, but their review should not come at the expense of more material financial risk considerations—and they should not drive the overall assessment of a firm’s condition. There is evidence that supervision has undergone such a shift, not only among large banks, but among regional and community banks as well.5 For all institutions, financial metrics are not among the primary findings determined from the examination process, and arguably they have been de-emphasized when assigning supervisory ratings.
    Prioritization is valuable in the supervisory process, both to inform how examiners allocate their time, but also in helping banks allocate resources to remediate issues identified during the supervisory process. The frequency of supervisory findings related to non-financial metrics may be a byproduct of how long it takes to remediate these issues, like longstanding issues with IT systems that have not been enhanced over many years of growth. However, we should also be vigilant and deliberate about any shift in supervisory focus from financial risk toward non-financial risks and internal processes, as this shift is not focused on fundamental safety and soundness issues and it is not cost-free.
    We should also not expect every firm to coalesce around a single set of products, internal processes, and risk-management practices. Variety in banking models is a strength and a necessity of the U.S. banking system, relying on management and boards of directors to determine bank strategy, rather than a bank’s business model effectively being set by supervisory directives.
    Supervisory practices like horizontal reviews can create examiner incentives to expect uniformity and “grade on a curve,” but this approach perversely punishes variation among bank practices, stifling competition and innovation. Supervisory findings also inform bank ratings, which can have follow-on effects like limiting options for mergers and acquisitions (M&A); raising the cost of liquidity; or diverting resources away from other, more important bank management priorities.
    Diagnostic AccountabilityTo maintain strong and appropriate supervisory standards and practices, we need to take a step back and diagnose the bank regulatory system in its entirety: what is working, what is broken, and what needs to be updated. When things go wrong, having an impartial check on subjective judgments can lead to a better diagnosis. Of course, a better diagnosis can produce more efficient and targeted improvements, and better promote accountability. Accountability is critical to maintaining an effective regulatory system, and yet it can be difficult to establish a regulatory culture that includes mechanisms to promote accountability for supervisors and regulators.6
    At every organizational level, from examiners to agency leadership, judgments are made that contribute to the overall effectiveness of the supervisory process. Reserve Bank examiners play a critical role in examining Fed-regulated institutions, both banks and holding companies. The Federal Reserve exercises its supervisory responsibilities by supervisory portfolio, with each portfolio relying on a combination of Board and Reserve Bank staff.7 But this split allocation of responsibility should not diminish the accountability for supervisory decision making. Responsibility for supervisory decisions must be coupled with accountability for these decisions. The misalignment of responsibility and accountability limits our ability to conduct effective supervision.
    This division of responsibility can pose a challenge to accountability. In the aftermath of the bank failures in 2023 and the broader stress to the banking system, the Board and other agencies proposed a variety of regulatory reform measures to remediate and address identified issues, based on internal reviews of the failures and banking stress. While I applaud efforts to hold ourselves accountable, we must ensure that self-reviews are credible, both in the causes they identify and in the reform agenda that they are used to support. An internal review process poses the temptation to avoid responsibility by assigning blame elsewhere, even when the review may be motivated by good intentions and with the outward appearance of impartiality.
    Many of the core problems in the lead-up to the bank failures involved well-known, core banking risks—interest rate risk, liquidity risk, and poor risk management. But if we look at the subsequent reform agenda, we see that the policy emphasis has been on broader regulatory changes rather than addressing supervisory program deficiencies. In my mind, this highlights the need to have a process that challenges the subjective judgments of those that were involved in oversight, not only in performing the diagnostics, but evaluating how identified issues can best be remediated.
    Purging Inaction and Opacity from the Supervisory ToolkitSupervision differs significantly from the regulatory process. Implementing new regulations, or amending existing ones, requires a public notice and comment process established by the Administrative Procedure Act. When done appropriately, regulations require regulators to “show their work” by providing extensive analytical and factual support for proposals and final rules and soliciting comment from the public and addressing those comments before finalizing a regulation. In contrast, the execution of bank examinations and the issuance of supervisory guidance lack these procedural safeguards, instead relying heavily on discretion and judgment with far lower standards for justifying actions taken with factual and analytical support under the veil of confidential supervisory information. The greater flexibility afforded in the supervisory process can lead to poor outcomes, often caused by the temptation to use inaction and opacity as supervisory tools. In my view, these tools, inaction and opacity, are not appropriate and must be subject to appropriate scrutiny or purged from the toolkit altogether.
    First let’s consider inaction. The exam process requires open communication between examiners and banks. Often interpretive questions arise during the exam process; how do existing rules and statutes apply in a particular circumstance? These questions arise when existing rules and guidance are unclear, which is a frequent occurrence. For example, how can a bank operate in a safe and sound manner while offering a new product or service, or when serving customers in particular business lines with unique needs? Banks go to great effort to meet all applicable requirements and regulatory expectations, and regulators should welcome banks seeking supervisory input and relying on a compliance-focused mindset.
    Open communication with regulated banks is a hallmark of good supervision, but regulators must live up to their end of the bargain by not leaving banks in “limbo” for extended periods of time. When a bank requests feedback and engages in good faith to provide information and respond to reasonable questions, regulators have an obligation to provide a clear response. Banks should not be left to wonder whether an interpretation of existing laws, regulations, and guidance is consistent with the understanding of regulators.
    Next, let’s consider opacity. Questions raised in the supervisory channel often result from supervisory expectations that lack sufficient clarity or the application of rules and regulations to new and emerging products and services. While regulators should not form an opinion without understanding the relevant facts and circumstances, they must also strive to provide clarity—not just to the bank being examined, but to all banks. Supervisory expectations should not surprise regulated firms, and yet transparency around expectations is often challenging to achieve.8
    The problem of opacity in supervisory expectations is exacerbated by the umbrella of confidential supervisory information, or CSI, which is the label given to most materials developed in the examination process. The rules designed to protect CSI limit the public’s visibility into shifting priorities and expectations in the supervisory process.9 Changes in supervisory expectations frequently come without the benefit of guidance, advance notice, or published rulemaking. In the worst-case scenario these shifts, cloaked by the veil of supervisory opacity, can have significant financial and reputational impacts or can disrupt the management and operations of affected banks.
    Opacity in supervisory expectations, or in the interpretation of applicable laws and regulations, should not be discovered only at the conclusion of an examination with the issuance of deficiencies, matters requiring attention, matters requiring immediate attention, or other shortcomings.
    Approach to ApplicationsSunshine is the best disinfectant when it comes to an approach that fosters transparency and accountability. So, I would like to spend a few minutes discussing how we can better shine a light into the dark corners of the bank applications process.
    De Novo FormationDe novo formation has essentially stagnated over the past several years. While many factors have contributed to the decline in the aggregate number of banks in the United States, one key factor has been the lack of new bank formation to replace banks that have been acquired or closed their doors. This lack of de novo bank approvals does not necessarily indicate a lack of demand for new charters though, particularly in light of ongoing demand for bank “charter strip” acquisitions where banks have been acquired just for their charters, the growing demand for banking-as-a-service partnerships, and the shift of activities outside of the banking sector into the non-bank financial system.10 We should consider whether the applications process itself has become an unnecessary impediment to de novo formation.
    How can we improve the process of de novo formation? As fewer applications come in, institutional muscle memory for how to deal with new bank charters erodes, and it becomes difficult to navigate and ultimately to overcome institutional inertia. A few steps like developing specialized expertise, streamlining the application process, and improving transparency can yield significant improvements.
    First, de novo formations are very different from other bank applications where there are existing institutions with established supervisory ratings and examination records. A de novo formation has no supervisory record of performance on which to base a decision or inform judgments about whether an application is consistent with approval. Instead, regulators must evaluate the proposal based on applicable statutory requirements: Is the business plan sound? Is appropriate bank leadership in place? Does the bank have a viable business plan and strategy? Is the bank’s proposal supported by sufficient capital? Should there be an expectation that all of these questions are answered exhaustively often well over a year before the bank would be formed, if it is approved?
    In recent years de novo formations have been rare, and therefore staff tasked with evaluating these proposals do not have a recent perspective or deep well of experience from which to draw. Under our current approach, regional Reserve Banks are the primary point of contact for de novo applicants. We should consider creating a specialized resource that can be utilized by any reserve bank to assist them during the pre-filing conversations with de novo applicants. Our goal should be to facilitate new bank creation—identifying and finding achievable pathways to yes, instead of expecting and insisting on increasing requirements to unachievable levels or those that are intended to deter applicants from filing or moving forward.
    We should also consider whether there are ways to streamline the application process, including, if needed, by recommending statutory changes. While the agencies use some common forms, de novo formations currently involve a range of regulatory approvals. A de novo applicant must apply for a bank charter from the Office of the Comptroller of the Currency or a state banking authority, deposit insurance from the Federal Deposit Insurance Corporation, and potentially membership or a parallel holding company formation application with the Federal Reserve.
    Each regulator may be focused on different aspects of the application, and each has the right to ask for additional information as part of the application review and analysis potentially significantly extending the review timeframe. We should have clear standards of review and approval—and coordinated actions—among the state and federal regulators involved in any application. This should include clear timelines for the point at which a regulator forfeits their opportunity to object due to inaction, delay, or stalling tactics.
    But standards for de novo approval are not always clear to applicants, which can lead to lengthy back-and-forth discussions with banking agency staff even after an applicant has prepared the information required by the appropriate application forms. The need for extensive additional information from de novo applicants can be caused by a failure to provide information requested in the application form, but I suspect the submission of incomplete information is often a product of forms that do not include all necessary information.
    We should not need to constantly supplement application forms with ad hoc information requests. If additional information is needed, we should modify the required application forms. One area where the lack of transparent and clear standards is most evident is with the amount of capital required to establish a de novo bank. Discussions around required capital often hinge on subjective assessments based on planned business model and growth, but they rarely involve regulators providing a minimum required capital amount. Standards for approval should not be shrouded in mystery.
    Reform of the de novo applications process should not be thought of as a deregulatory exercise. Clear and transparent standards do not imply “low” or inadequate standards. At the same time, if we want to encourage a pipeline of de novo bank formations, we should also be comfortable with the uncertainty that accompanies any new business, including the risk that some de novo banks will not succeed.
    The cost of eliminating the failure of de novo banks—or really of any banks at any time—is simply too great. Banking is fundamentally about appropriately managed risks, and regulators play a key role in promoting a system that is safe and sound while also serving to support the banking needs of customers and broader economic growth. Our goal should not be to create a banking system that is safe, sound, and ultimately irrelevant.
    Mergers and AcquisitionsThe issues with the banking applications process extend beyond de novo formations, but involve some of the same concerns, whether there are clear standards, and we are able to act in a timely manner. As a threshold matter, if regulators are clear about the information they need to process an application—for example, by updating applications forms to include the full set of information needed to analyze each statutory approval requirement—then we should also hold ourselves to fixed approval timelines. In my view, the purgatory of a long application process is another form of regulatory “inaction” that must be eliminated.
    We should also address aspects of the applications process that contribute to delay, including both the approach to competition and the public comment process.
    The banking agencies have long relied on competitive “screens” to evaluate the pro forma effect of a merger. This process looks at the standalone institutions, imagines a merger in which their operations are combined, and then looks at how measures of competition will change in the areas served by the merged institutions. Where there is overlap in markets served, there is the potential for tripping competitive screens and triggering additional scrutiny. At the Federal Reserve, when a competitive screen is triggered the application process takes more time, as staff reviews the conflict, and the matter is removed from the Reserve Bank-delegated processing track.
    Perversely, many banks that trigger additional scrutiny operate in rural markets and have less aggregate banking business over which institutions can compete. In these concentrated markets, the analytical approach may involve a counterfactual in which only two future states of the world exist—the banks continue to operate on a standalone basis, or the banks merge and operate as a consolidated whole. However, this framing ignores a possible third option, that one or both of the institutions will cease being viable and shut its doors, or be acquired by a credit union, similarly leading to an erosion of market competition and potentially greater disruption to the communities served. This analytical approach to evaluating competition no longer remains appropriate, and it needs to be reformed to better reflect actual market realities. This must include competition from credit unions, the farm credit system, internet banks, financial technology firms and other non-banks.
    Finally, many M&A applications come to the Board due to the receipt of an adverse comment from the public about the past supervisory record of one or both of the institutions involved in a merger. The receipt of an adverse comment causes substantial delays in the processing of an application, as this too removes an application from the “delegated” processing by the local Federal Reserve Bank, escalating the matter to the Board of Governors in D.C. While it is important that regulators take into account public feedback—and indeed, is required by applicable law—we should also be concerned about comments that may lack factual support or may solely rely on matters always considered in the review of a proposal, like the existing supervisory records of the acquirer and the target institution, and may be negated by the regulator’s own examination report.
    Approach to Regulation – Cleanup and the Statutory Regulatory ReviewSince the passage of the Dodd-Frank Act nearly 15 years ago, the body of regulations that all banks are subject to has increased dramatically. Many of the reforms made after the 2008 financial crisis were important and essential to ensuring a stronger and more resilient banking system. Yet, a number of the changes are backward looking—responding only to that mortgage crisis—not fully considering the potential future unintended consequences or future states of the world.
    With well over a decade of change in the banking system now behind us post-implementation, it is time to evaluate whether all these changes continue to be relevant. Some of the regulations put in place immediately after that financial crisis resulted in pushing foundational banking activities out of the banking system into less regulated corners of the financial system. We need to ask whether this is appropriate. These tradeoffs are complicated, and we must consider not only the changes that were made but also the evolution of and differences in the banking system today.
    Driving all risk out of the banking system is at odds with the fundamental nature of the business of banking. Banks, after all, are businesses. And they must be able to earn a profit and grow while also managing their risks. Adding requirements that impose more costs must be balanced with whether the new requirements make the correct tradeoffs between safety and soundness and enabling banks to serve their customers and run their businesses. The task of policymakers and regulators is not to eliminate risk from the banking system, but rather to ensure that risk is appropriately and effectively managed.
    In a well-functioning and appropriately regulated banking system, banks serve an indispensable role in credit provision and economic stability. The goal is to create and maintain a system that supports safe and sound banking practices, and results in the implementation of appropriate risk management. No efficient banking system can eliminate all bank failures. But well-designed and well-maintained systems can limit bank failures and mitigate the harm caused by any that occur.
    Maintenance of the regulatory framework is necessary to ensure that our regulations continue to strike the right balance between encouraging growth and innovation, and safety and soundness. One easily identifiable way to achieve this is using the Economic Growth and Regulatory Paperwork Reduction Act (EGRPRA) review process, which the agencies initiated in February last year.
    Although to-date it has not done so, the EGRPRA review requires the federal banking agencies to identify any outdated, unnecessary, or overly burdensome regulations and eliminate unnecessary regulations and take other steps to address the regulatory burdens associated with outdated or overly burdensome regulations. As I noted, prior iterations of the EGRPRA process have been underwhelming in their ability to result in meaningful change, but it is my expectation that this review, and eventually the accompanying report to Congress, will provide a meaningful process for stakeholders and the public to engage with the banking agencies in identifying regulations that are no longer necessary or are overly burdensome. It is also my expectation that regulators will be responsive to concerns raised by the public.
    Another area that is ripe for review are several of the Board’s rules that address core banking issues—from loans to insiders, to transactions with affiliates, to state member bank activities, and holding company requirements. Many of the Board’s regulations have not been comprehensively reviewed or updated in more than 20 years. Given the dynamic nature of the banking system and how the economy and banking and financial services industries have evolved over that period, it is imperative that we update and simplify many of the Board’s regulations, including thresholds for applicability and benchmarks.
    Finally, I want to address the unintended consequences of anti-money laundering requirements in the provision of banking services. I think we can agree that fighting money laundering, terrorist financing, and other illicit activities is not only a statutory responsibility of the banking system but it also serves important public policy goals. But while the regulatory framework prescribing how banks fulfill this role is not within the Federal Reserve’s responsibilities, it is important to consider how these requirements affect the ability of banks to serve customers. For example, the threshold for currency transaction reports (CTR) was established more than 50 years ago and has not been updated or indexed to inflation during that time. Just as an example, at the time it was implemented, a fully loaded Cadillac cost less than the CTR threshold. We’ve come a long way since 1972.
    It has also created a regime of more extensive and invasive reporting of customers’ transactions that may pose little actual risks related to tracking illicit activities. This reporting regime is also not cost-free, as banks may opt to avoid banking customers that trigger high volumes of CTR reporting, or that otherwise trigger the filing of suspicious activity reports. The calibration of reporting requirements, their effect on bank customers, and the growing problem of customer “de-banking,” warrant greater public attention.
    The Federal Reserve should review the supervisory messages given to banks and their holding companies about how supervisors will evaluate and consider the bank’s risks associated with customers that are caught in the Bank Secrecy Act or Anti-Money Laundering reporting web. I am concerned that this framework is being used to downgrade a bank’s condition based on a disproportionate weighting of its compliance with these requirements in comparison to its overall condition. There are separate examinations conducted for this purpose, and they should be viewed separately, not as a cudgel for downgrading a bank’s condition through the governance and controls mechanism or management assessment.
    Closing ThoughtsThe banking system can be an engine of economic growth and opportunity, particularly when it is supported by a bank regulatory framework that is rational and well-maintained. The work of rationalizing and maintaining this system is an ongoing cycle. While my remarks today have touched on a wide range of issues that require rationalization and “maintenance,” this is by no means an exhaustive list.
    Maintaining an effective framework is not only about ensuring the existing plumbing continues to work (and making it more efficient where possible) but it also must include promoting a system that is responsive to emerging threats and the needs of the banking system. As an example, the significant increase in fraud over the past few years has not generated the strong regulatory and governmental response necessary, even though fraud can become a source of material financial risk, particularly to smaller institutions.
    Thank you again for the opportunity to share my thoughts with you today. As always, it is a pleasure to be with you!

    1. The views expressed in these remarks are my own and do not necessarily reflect those of my colleagues on the Board of Governors of the Federal Reserve System or the Federal Open Market Committee. Return to text
    2. See, e.g., Michelle W. Bowman, “Bank Regulation in 2025 and Beyond (PDF)” (speech at the Kansas Bankers Association Government Relations Conference, Topeka, Kansas, February 5, 2025); Michelle W. Bowman, “Approaching Policymaking Pragmatically (PDF)” (speech at the Forum Club of the Palm Beaches, West Palm Beach, Florida, November 20, 2024); Michelle W. Bowman, “Building a Community Banking Framework for the Future (PDF)” (speech at the 2024 Community Banking Research Conference, St. Louis, Missouri, October 2, 2024); Michelle W. Bowman, “The Future of Stress Testing and the Stress Capital Buffer Framework (PDF)” (speech at the Executive Council of the Banking Law Section of the Federal Bar Association, Washington, D.C., September 10, 2024); Michelle W. Bowman, “Liquidity, Supervision, and Regulatory Reform (PDF)” (speech at “Exploring Conventional Bank Funding Regimes in an Unconventional World,” Dallas, Texas, July 18, 2024); Michelle W. Bowman, “The Consequences of Bank Capital Reform (PDF)” (speech to the ISDA Board of Directors, London, England, June 26, 2024); Michelle W. Bowman, “Innovation in the Financial System (PDF)” (speech at the Salzburg Global Seminar on Financial Technology Innovation, Social Impact, and Regulation: Do We Need New Paradigms?, Salzburg, Austria, June 17, 2024); Michelle W. Bowman, “Bank Mergers and Acquisitions, and De Novo Bank Formation: Implications for the Future of the Banking System (PDF)” (remarks at A Workshop on the Future of Banking, Kansas City, Missouri, April 2, 2024); Michelle W. Bowman, “Tailoring, Fidelity to the Rule of Law, and Unintended Consequences (PDF)” (speech at the Harvard Law School Faculty Club, Cambridge, Massachusetts, March 5, 2024); Michelle W. Bowman, “The Role of Research, Data, and Analysis in Banking Reforms (PDF)” (speech at the 2023 Community Banking Research Conference, St. Louis, Missouri, October 4, 2023). Return to text
    3. See Board of Governors of the Federal Reserve System, Supervision and Regulation Report (PDF) at 16-17 (Washington: Board of Governors, November 2024), (describing data for the first half of 2024, the most recent period for which data is available). Return to text
    4. Board of Governors of the Federal Reserve System, Supervision and Regulation Report. Return to text
    5. Board of Governors of the Federal Reserve System, Supervision and Regulation Report at 17, 20. Return to text
    6. See Michelle W. Bowman, “Accountability for Banks, Accountability for Regulators (PDF)” (Essay published in Starling Insights, February 13, 2024). Return to text
    7. “Understanding Federal Reserve Supervision,” Board of Governors of the Federal Reserve System, last modified April 27, 2023. Return to text
    8. See Michelle W. Bowman, “Approaching Policymaking Pragmatically (PDF)” (speech at the Forum Club of the Palm Beaches, West Palm Beach, Florida, November 20, 2024). Return to text
    9. See Michelle W. Bowman, “Reflections on the Economy and Bank Regulation (PDF)” (speech at the New Jersey Bankers Association Annual Economic Leadership Forum, Somerset, New Jersey, March 7, 2024). Return to text
    10. See Michelle W. Bowman, “The Consequences of Fewer Banks in the U.S. Banking System (PDF)” (speech at the Wharton Financial Regulation Conference, Philadelphia, Pennsylvania, April 14, 2023). Return to text

    MIL OSI USA News –

    February 18, 2025
  • MIL-OSI: naturalX secures €100 Million to fuel the future of Consumer Health in Europe

    Source: GlobeNewswire (MIL-OSI)

    Berlin, Feb. 17, 2025 (GLOBE NEWSWIRE) — Healthcare is undergoing a fundamental transformation, shifting from reactive sick care to proactive health management, with consumers firmly in the driver’s seat. While the U.S. market has seen the rise of consumer-centric healthcare champions like Hims/Hers, Headspace, and Function Health, Europe’s market remains underserved. Today, naturalX Health Ventures announced a €100 million fund to accelerate this revolution in Europe, becoming the first specialized fund focused exclusively on the intersection of consumer and health in the European market.

    The fund will focus primarily on Series-A investments while remaining flexible to participate in late Seed and Series-B rounds. Typical first investments range from €3-5 million, with up to €10 million available per company. naturalX can act as either lead investor or co-investor, targeting consumer health startups across Europe with selected investments in North America.

    naturalX Health Ventures founder Marvin Amberg (CREDIT: Yves Callewaert)

    naturalX was founded by Marvin Amberg, a German serial entrepreneur with experience launching consumer and health startups, in cooperation with Schwabe Group, a global leader in plant-based pharmaceuticals. The fund defines consumer health as the intersection of wellness and medicine, where science-backed products and services put the consumer in focus. During its 18-month ramp-up phase, naturalX has already made several investments, including mybacs, Flow Neuroscience, Kyan Health, and Meela, while also investing in healthcare-focused VC funds to build a strong ecosystem around their thesis.

    “I am very excited to double down on our thesis with the official launch of naturalX. The consumer health space has been overlooked by investors. We see an inflection point in Europe now, as consumers are finally taking more charge of their own health. Startups in the space need a partner with a shared vision,” said Marvin Amberg, founder of naturalX Health Ventures.

    The fund’s launch comes at a pivotal moment in consumer health. The COVID-19 pandemic has accelerated consumers focus on proactive health management, while rising health literacy – driven by mega-influencers like Andrew Huberman, Peter Attia and Bryan Johnson – has created more informed healthcare consumers who see health as a status symbol. Easier access to data through technology, including AI, is further driving the shift toward consumer-centric healthcare.

    naturalX targets solutions across proactive health, including sleep, gut health, prevention, and longevity. The fund also places special emphasis on mental health, recognizing the growing need for consumer-centric therapeutic solutions in this underserved area. The investment strategy bridges Schwabe Group’s deep pharmaceutical expertise with modern digital health innovation.

    “We analysed the U.S. health market and in many successful startups, the consumer is already at the centre. Our thesis is that this is just the beginning, and the European market will develop in a similar pattern. While we start to see some examples of consumer-focused healthcare companies in Europe reaching meaningful scale and significant funding, such as Oura or Neko Health, we think this market deserves more attention,” added Marvin Amberg.

    “naturalX led our Series-A round and has been an exceptional partner, bringing not only capital but also invaluable knowledge of the nutritional supplement and broader consumer health market. Their pragmatic, fast decision-making allows us to focus on growing our business,” said Carl-Philipp von Polheim, Founder of mybacs, a leading DTC probiotic subscription startup.

    “At Kyan Health, we are dedicated to proactive mental health management—empowering individuals before issues escalate. naturalX shares this vision, recognizing that prevention is key to lasting impact. Their deep expertise and strategic approach make them an ideal partner in driving meaningful change for millions,” said Vlad Gheorghiu, Founder of Kyan Health, a leading mental health platform for employees.

    Following the recent closing, the fund is now fully operational and actively building its cross-European investment team.

    Ends

    Media images can be found here. 

    About naturalX Health Ventures
    naturalX Health Ventures is a €100 million venture capital fund focused on Consumer Health startups that are reshaping the future of healthcare. The fund invests mainly across Europe at Series-A stage while also looking at late Seed and Series-B opportunities. naturalX is backed by Schwabe Group, a global leader in plant-based pharmaceuticals.

    The MIL Network –

    February 18, 2025
  • MIL-OSI Economics: Christodoulos Patsalides: Cyprus and the euro area – navigating growth, stability, and opportunities

    Source: Bank for International Settlements

    I would like to thank the Cyprus Shipping Chamber for giving me the opportunity to address this meeting today and discuss key economic developments. My remarks will begin with an overview of Cyprus’ economic performance. I will then discuss the notable progress achieved in the banking sector and underscore the critical role of the shipping industry in driving export revenues. Following this, I will turn to the broader economic outlook for the Euro Area, concluding with insights into the European Central Bank’s latest monetary policy decision on achieving price stability.

    Domestic economic outlook

    The Cypriot economy continues to exhibit robust growth, despite facing persistent external challenges in a turbulent and uncertain global environment. Geopolitical risks, such as the ongoing war in Ukraine, conflicts in the Middle East, and rising international tensions, have elevated economic uncertainty.

    Amidst these conditions, the Cypriot economy has consistently demonstrated remarkable resilience and flexibility. This is clearly reflected in its recent upgrades by credit rating agencies to the “A” category, further cementing its reputation in international financial markets. These upgrades underscore the growing confidence in Cyprus’s fiscal policies and the solid outlook for its economic and banking systems.

    Improved fiscal performance has been a cornerstone of these positive developments. Public debt has been reduced significantly, declining from 114% of GDP in 2020 to 74% in 2023, highlighting disciplined financial management. Projections from the Ministry of Finance indicate that this downward trajectory will continue, with public debt expected to fall below 50% of GDP by 2028. This progress strengthens fiscal sustainability and enhances the country’s ability to respond to future challenges, reflecting a strong commitment to long-term economic stability.

    According to the December 2024 projections of the Central Bank of Cyprus (CBC), economic growth for 2024 is expected to reach 3.7%, significantly higher than the projected Eurozone average of 0.7%. The expansion of productive sectors such as technology, trade, tourism, financial and professional services, shipping, and construction-particularly large private sector infrastructure projects-has been a key driver of growth.

    For the period 2025-2027, GDP is expected to grow by approximately 3% annually, driven primarily by a projected increase in domestic demand and, to a lesser extent, external demand. Domestic demand is expected to be supported by a rise in private consumption due to the increase in real disposable household income and the continued resilience of the labour market. Additionally, domestic demand will benefit from ongoing large-scale private non-residential investments, infrastructure projects aimed at supporting digital and green development, and other reform projects under the Recovery and Resilience Plan.

    Regarding the shipping sector in particular, our small island has a maritime history spanning hundreds of years, and it is rightly is considered as one of the main pillars of the Cypriot economy. The country’s maritime industry considerably contributes directly and indirectly to the country’s GDP. Based on 2023 data, the shipping sector ranks third with a share of 17.2% to the total value of exports of services, after the Information and Communication Technology sector, the financial services and the tourism sectors, with shares of 30.2%, 20.3% and 11,5% respectively. In view of the aforementioned figures, it is evident that the sector managed to stay focused and strong despite the unprecedented challenges faced in the last few years, namely the covid pandemic, the wars in Ukraine and Gaza as well as the tensions in the Red Sea. 

    The strength of the labour market further reinforces this positive narrative. Unemployment has declined to 5% in the first nine months of 2024, compared to 5.8% in 2023. It is projected to remain at 5% for the full year and to fall further to 4.6% by 2027, approaching levels indicative of full employment. These figures compare favourably to the euro area, where unemployment is forecast to stabilize at 6.1% by 2027.

    On the prices front, inflationary pressures have eased significantly, with inflation dropping to 2.2% in the first eleven months of 2024, compared to 4.1% in the same period of 2023. According to the CBC’s December 2024 projections, inflation is expected to stabilize near the 2% medium-term target, reaching 1.9% in 2025, 2.1% in 2026, and 2.0% in 2027.

    The Cyprus banking sector

    The Cyprus banking sector has demonstrated tangible progress and resilience, with key financial metrics reflecting a strong and sound performance. A primary indicator of this strength is the solid improvement in terms of solvency, with the Common Equity Tier 1 (CET1) ratio increasing from 21.5% in December 2023 to 23.5% in September 2024. This increase marks the highest CET1 ratio in the Union, surpassing the EU average of 16.0%.

    Despite the challenges posed by consecutive crises, no tangible signs of credit quality deterioration are observed up to this point. In fact, the Non-Performing Loans (NPL) ratio has continued its positive downward trend. As of September 2024, the NPL ratio stands at 6.5%, a marked improvement from 7.9% in December 2023. This reduction reflects the sector’s ongoing commitment to addressing legacy issues, bolstering the financial health of the asset side of its balance sheet, and reinforcing its capacity to support economic recovery. Yet, there is still some way to go, particularly considering that the average NPL ratio of the EU sector stands as of September 2024 at 1.9%. Furthermore, the improvement within the Cyprus banking sector has not been homogeneous across all institutions, with certain banks lagging behind. These institutions must therefore accelerate their efforts to align with the sector-wide advancements.

    Profitability metrics have been robust, with the Return on Equity (RoE) reaching 23.2% in September 2024 as opposed of 11,1% of the EU average. Operational efficiency has improved as the cost-to-income ratio declined to 35.5%, a notable reduction from previous years and lower than the EU average of 53%.

    Cyprus banks also exhibit some of the highest liquidity standings in the EU, reinforcing their ability to meet potential liquidity demands. The Liquidity Coverage Ratio (LCR), a measure of a bank’s ability to withstand large liquidity outflows under a stressed period, stands as of September 2024 at 336%, compared to the EU average of 161% and minimum requirement of 100%. Furthermore, the Net Stable Funding Ratio (NSFR), which assesses the stability of a bank’s funding base, stands also high at 187%, surpassing both the EU average of 127% and the minimum regulatory requirement of 100%. The Cypriot banking sector is thus well-positioned to face potential market disruptions and continue driving economic stability.

    Through the first 11 months of 2024, Cypriot banks granted €3.3 billion in new loans to households and non-financial corporations (NFCs), surpassing the already high €2.9 billion provided during the same period in 2023. A negative side effect of a strongly liquid banking sector in a small country is the slow adjustment of interest rates in response to ECB monetary policy actions. Banks must exhibit responsible pricing policies in the face of reputation risk and the need to support the competitiveness of the economy.

    Looking to the future, the banking sector faces challenges such as adapting to AI, mitigating cyber risks, addressing geopolitical uncertainties, and transitioning to a greener economy. Tackling these priorities is essential for sustaining the sector’s positive trajectory and remains central to our supervisory agenda.

    Economic Developments in the Euro Area

    The risks to economic growth continue to lean towards the downside. Increased disruptions in global trade may hinder euro area growth by suppressing exports and slowing the global economy. Additionally, reduced confidence could delay the recovery of consumption and investment beyond current expectations. The ECB’s December projections estimate economic growth of 0.7% in 2024, 1.1% in 2025, 1.4% in 2026, and 1.3% in 2027. This recovery is expected to be driven primarily by rising real incomes, which should enable households to boost consumption, alongside increased investment by firms.

    On the price front, euro area inflation rose to 2.4%, in December 2024, up from 2.2% in November, primarily driven by increased energy costs but this was expected due to energy-related upward base effects.

    Despite the upticks in recent months, the disinflation process is well on track. ECB Staff see headline inflation averaging 2.4 per cent in 2024, 2.1 per cent in 2025, 1.9 per cent in 2026 and 2.1 per cent in 2027 when the expanded EU Emissions Trading System becomes operational. Services inflation continues to be sticky at around 4%, largely stemming from the delayed catch-up adjustment of certain services prices to past inflation surges and ongoing wage pressures. At the same time, recent signals point to continued moderation in wage pressures and to the buffering role of profits.

    Inflation is expected to fluctuate around its current level in the near term. It should then settle sustainably at around the two per cent medium-term target. Easing labour cost pressures and the continuing impact of past monetary policy tightening on consumer prices should help this process. Most measures of longer-term inflation expectations continue to stand at around 2 per cent.

    ECB Monetary Policy

    Based on our updated assessment of the inflation outlook, underlying inflation dynamics, and the effectiveness of monetary policy transmission, we decided at our January Governing Council meeting to further reduce the three key ECB interest rates by 25 basis points. This adjustment brought the deposit facility rate-the primary tool for steering our monetary policy stance-to 2.75%

    Overall, the euro area’s economic environment remains intricate, with the risks to economic growth tilted to the downside and with both upside and downside risks to inflation present. The ECB continues to navigate these challenges through measured, careful adjustments in its monetary policy stance. Growth is a factor influencing inflation dynamics. It is crucial to ensure that the economy does not grow too slowly, as this could lead to inflation stabilizing below the target. As we move forward, in the current environment of elevated uncertainty stemming from potential global trade frictions and geopolitical tensions, the ECB’s prudent data-dependent meeting by meeting approach shall continue to be important in addressing the evolving economic conditions within the euro area to ensure the timely return to the inflation target in a sustainable manner. The ECB is not pre-committing to a particular rate path.

    Conclusion

    Let me now conclude: the Cypriot economy has shown resilience and adaptability, supported by strong performance, prudent fiscal policies, and a stable financial system, with key contributions from banking and shipping. As one of the pillars of our economy, the shipping sector continues to demonstrate global competitiveness and innovation, further strengthening Cyprus’s position as a leading maritime hub. Looking ahead, challenges like climate change and geopolitical risks demand strategic foresight, but Cyprus is well-prepared to sustain growth.

    At the Euro Area level, the economic outlook balances risks and opportunities, with the ECB ensuring price stability and sustainable growth through proactive, data-driven policies. By remaining data-driven and proactive, we can ensure that the monetary framework across the region remains resilient and responsive to evolving global dynamics.

    Thank you.

    MIL OSI Economics –

    February 18, 2025
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