South Korea’s unemployment rate hit an eight-year high in August as mandatory minimum wages rose, adding to economic policy frustrations and political challenges for President Moon Jae-in whose approval rating is now at its lowest since inauguration.

The unemployment rate rose to 4.2 percent in August from 3.8 percent in July in seasonally adjusted terms as the number of unemployed rose by 134,000 people from a year earlier.

This was the labor market’s worst performance since January 2010, when the economy was still reeling from the global financial crisis, when 10,000 jobs were lost.

Finance Minister Kim Dong-yeon said on Wednesday the government will need to adjust its wage policies, signaling some future soft-pedaling in the drive to raise minimum wages.

“(The government) will discuss slowing the speed of minimum wage hikes with the ruling party and the presidential office,” Kim Dong-yeon told a policy meeting in Seoul, adding he did not expect a short-term recovery in the job market.

Experts say the uproar over jobs could also cost Moon considerable political capital as he pursues closer ties with Pyongyang, as any good news from an inter-Korean summit may not be enough to offset public discontent over the lack of jobs and soaring housing prices.

More than 60 percent of respondents in a Gallup Korea survey criticized Moon’s handling of the economy, including his ‘inability to improve the livelihoods of ordinary citizens’ and ‘minimum wage increases.’

The jobs report showed the labor-intensive retail and accommodation sector, which lost 202,000 jobs in August from a year earlier, was the hardest hit.

A total 105,000 jobs were lost from manufacturing industries, the report said.

However, the agriculture, construction and transport sectors saw a rise in the number of employed, partly offsetting the rise in the number of workers laid off.

The overall number of employed people rose by just 3,000 – also the worst since January 2010.

Each month’s worsening jobs report has sparked a strong public backlash, with President Moon Jae-in’s approval rating falling below 50 percent for the first time on Sept. 7.

A weekly Gallup Korea survey released on Friday showed Moon’s support fell 4 percentage points to 49 percent, the lowest since he took office in May 2017.

“At this rate, we may not see any gains in the number of employed in September or the month after that,” said Oh Suk-tae, an economist at Societe Generale.

Oh said economists at the Korea Development Institute, a state-run think tank, believed this year’s 16 percent increase in the minimum wage – the biggest jump in nearly two decades – was discouraging employers from hiring.

“The president should be held responsible for this, nothing could change the trend unless the boss changes his mind about minimum wage hikes,” Oh said.

The workforce participation rate declined slightly to 63.4 percent from 63.6 percent in July, as more jobs were lost than created, Statistics Korea data showed.

 
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In Iraq, a major Middle East grain buyer, will cut the irrigated area it plants with wheat by half in the 2018-2019 growing season as water shortages grip the country, a government official told Reuters.

Drought and dwindling river flows have already forced Iraq to ban farmers from planting rice and other water-intensive summer crops. Water scarcity was one of the issues galvanizing street protests in the country this year.

An investigation by Reuters in July revealed how Nineveh, Iraq’s former breadbasket, was becoming a dust bowl after drought and years of war.

This latest move is likely to significantly raise wheat imports.

Deputy Agriculture Minister Mahdi al-Qaisi said irrigated land grown with winter grains, namely wheat and barley, would be halved.

“The shortage of water resources, climate change and drought are the main reasons behind this decision, our expectation is the area will shrink to half,” Qaisi said in an interview.

Iraq’s agricultural plan included 1.6 million hectares of wheat last 2017-2018 season. Of those, around one million hectares were irrigated and the rest relied on rainfall.

“We expect that the irrigated wheat area falls to half of what it was last year,” Qaisi said, implying plantings of 500,000 hectares.

The cut is expected to lower the country’s wheat production by at least 20 percent, implying a significantly higher import bill Fadel al-Zubi, the U.N. Food and Agriculture Organization Iraq Representative said.

Iraq already has an import gap of more than one million tonnes per year, with annual demand at around 4.5 million to 5 million tons.

“Imports will go up as a result of cutting down on production and also as a result of population increase,” Zubi said but he declined to give an exact estimate for size of imports next year.

Haidar al-Abbadi, the head of Iraq’s General Union of Farmers, confirmed the cut saying water shortage was the main reason behind it.

“Irrigated wheat will reach 2 million donhums (500,000 hectares) down from around 4 million last season,” he said.

Qaisi said it was too early to tell the area of land that could be grown with wheat relying on rainfall this season but he hoped it would make up for some of the shortfall.

“We will follow a few programs to increase the crop, like raising yields and bringing Nineveh province back to more production … that can partly make up for shortfall,” he said.

But the rains failed Iraq’s Nineveh last season with the government procuring a little over 100,000 tonnes of wheat this year from a region that used to produce close to one million tons annually before Islamic State took over in 2014.

Iraq imports wheat to supply a rationing program created in 1991 to combat U.N. economic sanctions, including flour, cooking oil, rice, sugar and baby milk formula.

The trade ministry is responsible for procuring strategic commodities, including wheat, for the program.

Trade ministry officials were not immediately available for comment on a potential rise in imports.
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Residents in a Bangkok neighborhood are trying out a renewable energy trading platform that allows them to buy and sell electricity between themselves, signaling the growing popularity of such systems as solar panels get cheaper.

The pilot project in the center of Thailand’s capital is among the world’s largest peer-to-peer renewable energy trading platforms using blockchain, according to the firms involved.

The system has a total generating capacity of 635 KW that can be traded via Bangkok city’s electricity grid between a mall, a school, a dental hospital and an apartment complex.

Commercial operations will begin next month, said David Martin, managing director of Power Ledger, an Australian firm that develops technology for the energy industry and is a partner in the project.

“By enabling trade in renewable energy, the community meets its own energy demands, leading to lower bills for buyers, better prices for sellers, and a smaller carbon footprint for all,” he said.

“It will encourage more consumers to make the switch to renewable energy, as the cost can be offset by selling excess energy to neighbors,” he told the Thomson Reuters Foundation.

Neighborhoods from New York to Melbourne are upending the way power is produced and sold, with solar panels, mini grids and smart meters that can measure when energy is consumed rather than overall consumption.

The World Energy Council predicts that such decentralized energy will grow to about a fourth of the market in 2025 from 5 percent today.

Helping it along is blockchain, the distributed ledger technology that underpins bitcoin currency, which offers a transparent way to handle complex transactions between users, producers, and even traders and utilities.

Blockchain also saves individuals the drudgery of switching between sending power and receiving it, said Martin.

For the pilot in Bangkok’s upmarket Sukhumvit neighborhood, electricity generated by each of the four locations will be initially used within that building. Excess energy can be sold to the others through the trading system.

If there is a surplus from all four, it will be sold to the local energy storage system, and to the grid in the future, said Gloyta Nathalang, a spokeswoman for Thai renewable energy firm BCPG, which installed the meters and solar panels.

Thailand is Southeast Asia’s leading developer of renewable energy, and aims to have it account for 30 percent of final energy consumption by 2036.

The energy ministry has encouraged community renewable energy projects to reduce fossil fuel usage, and the regulator is drafting new rules to permit the trade of energy.

The Bangkok Metropolitan Electricity Authority forecasts “peer-to-peer energy trading to become mainstream for power generation in the long run,” a spokesman told reporters.

BCPG, in partnership with the Thai real estate developer Sansiri, plans to roll out similar energy trading systems with solar panels and blockchain for a total capacity of 2 MW by 2021, said Gloyta.

“There are opportunities everywhere – not just in cities, but also in islands and remote areas where electricity supply is a challenge,” she said.
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Policymakers in Indonesia are grappling to deal with a weakened currency, the rupiah, which was valued at just 14,930 per U.S. dollar last week — its lowest point since the 1998 Asian financial crisis. But unlike 20 years ago, when economic turmoil led to major political upheaval in Indonesia, most observers say that Southeast Asia’s largest economy is now far better positioned to endure a poorly performing currency.

The United States Federal Reserve’s planned interest rate hikes have impacted emerging markets worldwide as investors sell assets in countries such as Indonesia in favor of American ones. The Argentine peso and Turkish lira both crashed in late August, crises that sent major shockwaves across developing economies. President Donald Trump’s trade war with Beijing has also seen a devaluation of the Chinese yuan.

These external factors have badly hit the Indonesian rupiah, already one of the weakest currencies in Asia. According to Bloomberg, the rupiah has lost around 9 percent of its value against the greenback during 2018. Like Turkey and Argentina, Indonesia also has a so-called “twin” deficit, meaning it is running both fiscal and current account deficits.

“Indonesia obviously is one of the frontline currencies alongside the Indian rupee and the Philippine peso, these are the three currencies most battered among the regional pack… in the latest turmoil,” said Prakash Sakpal, an economist from ING in Singapore.

Stronger 20 years on

In the late 1990s, the collapse of the rupiah exacerbated a severe economic crisis, which led to the fall of Indonesia’s longtime dictator Suharto.

“We know what we face with the rupiah is a really, really important problem,” the head of Research at the Jakarta-based brokerage and investment management firm Ekuator, David Setyanto, told VOA. “But if you compare with Turkey or Argentina, we are not the same with them because our fundamental economics are much stronger than these two countries.”

Dr. Tommy Soesmanto, an economics lecturer at Griffith University, told VOA that “Indonesians should not be overly concerned with the current situation,” as the economy is in a far stronger position than in 1998. During the Asian Financial Crisis, the rupiah fell from 3000 against the US dollar to 15,000 — a depreciation of some 500 percent from which it never recovered, hovering at around 10,000 per dollar in subsequent years.

Indonesia’s credit rating is now Triple B as opposed to 1998 when it was “considered junk”, Soesmanto said, while the country now has net capital inflow compared with “severe” capital outflow in 1998. Bank Indonesia holds foreign reserves worth some $118 billion compared with just $24 billion back then, allowing it greater leverage to finance debts and imports.

Charu Chanana, Deputy Head of Asia Research at Continuum Economics in Singapore, agreed. “We believe Indonesia is much stronger today fundamentally when compared to 1998,” she wrote in an email. “However, as external headwinds persist, we believe Indonesia’s currency will remain in the firing line due to a weak external position and high foreign exposure in the stock and bond markets.”

“I think it’s a little bit overblown,” said Sakpal of ING when asked about the severity of the currency crisis, noting that “economic fundamentals for most of the regional economies are still solid.”

“In Indonesia, growth has accelerated in the second quarter to 5.3 percent, which was the fastest in many quarters… all the recent turmoil is driven by external factors,” he said.

Unite for the rupiah

Bank Indonesia, the central bank, has responded aggressively to the latest currency problems by raising interest rates four times since May. For months it has also sold foreign currency and bought sovereign bonds in a bid to stabilize the currency.

The government, meanwhile, has now imposed higher import taxes of up to 10 percent on some 1000 consumer goods, including cosmetics and luxury cars.

“This is a good chance for local producers to penetrate our own domestic market that is usually filled with imported goods,” Indonesia’s Finance Minister Sri Mulyani Indrawati said last week.

The weak rupiah is likely to hit Indonesia’s manufacturing sector hardest, and accordingly, the government has imposed lower tax hikes of 2.5 percent on imported raw materials. The energy and resources ministry also announced it would delay $25 billion worth of power projects, aimed at producing an additional 35 gigawatts of electricity, which is expected to save $8 to $10 billion in import costs.

“We can come together for the success of the #AsianGames2018,” read a Facebook post from the Finance Ministry last week, accompanied by infographics urging Indonesians to buy local products, reduce their consumption of imports, change U.S. dollars for rupiah, travel within Indonesia and invest locally. “We can also #BersatuUntukRupiah [unite for the rupiah].”

 
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United States is a land of opportunity. We have all heard this saying, but what does it mean and how does it happen? A Kurdish-American family in the state of Virginia is seeing how their 13-year-old son has made the most of a unique opportunity. VOA’s Yahya Barzinji recently visited this family and filed this report narrated by Bezhan Hamdard.
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Japan will once again try to get the international ban on whale hunting overturned at the global conference of the International Whaling Commission (IWC), which opened in Brazil on Monday.

The proposal presented by Japan says, “Science is clear: there are certain species of whales whose population is healthy enough to be harvested sustainably.”

While the Japanese proposal is supported by other traditional whaling countries, such as Iceland and Norway, it faces fierce opposition from countries such as Australia and Brazil, and the European Union, as well as from numerous environmental groups.

Japan, which has pushed for an amendment to the ban for years, accuses the IWC of siding with anti-whaling nations rather than trying to reach a compromise between conservationists and whalers.

Whale meat has been a a traditional part of the Japanese diet for centuries.

After the IWC adopted a ban on commercial whaling in 1982, Japan, Norway and Iceland continued to hunt whales. Tokyo justified the practice as a part of scientific research, which was allowed by the moratorium.

But in 2014, the International Court of Justice ruled that Japan’s whaling practice had no scientific basis, but instead it was a way to keep the industry alive.

This year, Japan wants to establish a Sustainable Whaling Committee to oversee the hunting of healthy whale populations for commercial purposes.

But environmentalists say allowing even limited hunting of the mammoth mammals will only again push the species to the brink of extinction. Brazil introduced  proposal Monday that says hunting whales is “no longer a necessary economic activity.”

Australia has vowed to lead the charge against reinstatement of commercial whaling and it has the strong backing of New Zealand, the European Union and the United States.

Japan’s proposal will likely be put to a vote sometime before the conference ends on Sept. 14.
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Canadian Foreign Minister Chrystia Freeland will meet U.S. Trade Representative Robert Lighthizer in Washington on Tuesday for another round of talks to renew the NAFTA trade pact, an official said on Monday, as time runs short to seal a deal.

Freeland spokesman Adam Austen did not give details. After more than a year of negotiations, Canada and the United States are still trying to resolve differences over the North American Free Trade Agreement, which also includes Mexico.

U.S. officials say time is running out to agree on a text on which the current Congress can vote. Canadian officials say they are working on the assumption they have until the end of September.

Freeland spent three days in Washington last week and said on Friday as she prepared to leave that she and Lighthizer were making very good progress in some areas, although a deal remained out of reach.

U.S. President Donald Trump, who says he is prepared to tear up NAFTA, has struck a trade deal with Mexico and threatened to push ahead without Canada.

Uncertainly over the future of NAFTA, which underpins $1.2 trillion in trade, is weighing on markets as well as the Canadian and Mexican currencies.

Officials say the main sticking points are Canada’s dairy quota regime, Ottawa’s desire to keep a dispute-resolution mechanism, and Canadian media laws that favor domestically produced content.

U.S. Agriculture Secretary Sonny Perdue, speaking in an interview broadcast on Sunday, said Canada had to scrap a low-price milk proteins policy to reach a deal on NAFTA. U.S. farmers complain Canada is flooding export markets.

Austen, asked whether Freeland might return to Washington later in the week, said no decisions had been taken. She is due to attend a two-day meeting of legislators from the ruling Liberal Party in western Canada on Wednesday and Thursday.

Prime Minister Justin Trudeau said last Wednesday he did not see the need to attend the talks for the time being.
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Greece’s lead creditor warned the country on Monday not to stray from reforms agreed upon before the end of its international bailout, as European monitors arrived to check the nation’s finances.

The five-day inspection is expected to focus on government promises over the weekend to offer tax relief as well as plans to scrap promised pension cuts that are due to take effect in 2019.

Klaus Regling, managing director of the European Stability Mechanism, the eurozone’s rescue fund, told Austria’s Die Presse newspaper that Greece needed to stick to its commitments.

`We are a very patient creditor. But we can stop debt relief measures that have been decided for Greece if the adjustment programs are not continued as agreed,” he said. “The debt level appears to be frighteningly elevated. But Greece can live with that as the loan maturities are very long and the interest rates on the loans are much lower than in most other countries.”

Left-wing Prime Minister Alexis Tsipras is trailing opposition conservatives in opinion polls and must call a general election within the next 12 months. Amid large protest rallies led by labor unions over the weekend, the prime minister said that relief measures promised to taxpayers would not jeopardize fiscal performance targets and would be introduced gradually.

Greece has promised to deliver high primary surpluses — the budget balance before calculating the cost of servicing debt — for years to come, along with a series of reforms in exchange for better debt repayment terms.

The end of the bailout means Greece will have to return to international capital markets to finance itself. However, the country faces a troubled return after the financial turmoil in Turkey and Italy halted a decline in Greek borrowing rates. The yield on Greece’s 10-year-bond remains above 4 percent.

The bailout program ended August 20 but the country’s debt level remains near 180 percent of gross domestic product.
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Zimbabwe’s new finance minister has described his task of reviving the country’s moribund economy as extraordinarily difficult, but he is hopeful of success.

“It’s enormous, it is Herculean. I am very energetic and I am very up to the task. I am starting now, but in the process what I will do is listen,” said Finance Minister Mthuli Ncube, a former chief economist and vice president of the African Development Bank.

He spoke to VOA at the State House after being sworn into office Monday by President Emmerson Mnangagwa.

Nearby, 21-year-old Isaac Madyira is jobless. He dropped out of school seven years ago after his also parents, also unemployed, failed to pay the fees. He now sells cash, which has been in acute short supply for the past two years in Zimbabwe. He says he expects change from the new Cabinet Mnangagwa put into office Monday.

“What we want is corruption to be get rid of. We want development as quickly as possible. I think [on] the issue of money, we need our own currency which is valued as compared to other currencies, then bond notes must go [the last two words in Shona],” he said.

Zimbabwe started printing bond notes about two years ago to ease cash shortages. They were supposed to trade at par with the U.S. dollar, but on the black market the notes are worth about half as much as a dollar and cash shortages have not ended.

Almost as if Ncube had talked to Madyira, the new finance minister said he has to address the currency issue for Zimbabwe’s economy to get back on track.

“Restoring confidence in the economy, I make sure that international investors are interested in the Zimbabwean economy again,” said Ncube. “I will be rolling [out] a plan on the arrears clearance and the whole debt restructuring process, coupled with that is building credit lines globally. Internally I make that on the expenditure side we live within or means or move towards that. We need to strengthen our tax collection systems. Ultimately we need to have the Zimbabwe dollar that is stable, that people have confidence in. To have a domestic currency, you need to build reserves.”

Zimbabwe abandoned its worthless dollar in 2009 and has been using the U.S. dollar, South African rand and British sterling pound for trading.

An economist for the Labor and Economic Development Research Institute of Zimbabwe, Prosper Chitambara, says the Ncube is a good choice for the job.

“It is a good start. He is someone who is credible, a professional. But what has to be done is to begin real work,” he said. “To roll up his sleeves and begin to implement key fiscal policies that will bring back confidence into the economy. Reining down on recurrent expenditure. In general, what we need are fiscal consolidation reforms that curtail drastically recurrent government expenditure.”

Chitambara says Zimbabwe’s government spends much of its revenue on salaries, leaving social services sectors like education and health in dire need unless Western aid agencies, like USAID, assist. Chitambara says Ncube has to change that if the country is to recover.

 
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Ford says it has no plans to move production of a small car from China to the United States despite President Donald Trump’s enthusiastic tweet Sunday.

“It would not be profitable to the build the Focus Active in the U.S. given an expected annual sales volume of fewer than 500,000 units,” a Ford statement said.

Ford earlier announced it would not ship the cars from China to the United States because tariffs would make them too expensive, prompting a Trump tweet saying “This is just the beginning. This car can now be BUILT IN THE U.S.A. and Ford will pay no tariffs.”

Ford may keep building the Focus Active in China, but won’t not sell them in the United States.

Trump has imposed tariffs on $50 billion in Chinese imports to remedy what he calls unfair Chinese trade practices. China has retaliated and both countries threaten more tariffs.
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Greek Prime Minister Alexis Tsipras on Saturday unveiled plans for tax cuts and pledged spending to heal years of painful austerity, less than a month after Greece emerged from a bailout program financed by its European Union partners and the International Monetary Fund.

Tsipras, who faces elections in about a year, used a keynote policy speech in the northern city of Thessaloniki to announce a spending spree that he said would help fix the ills of years of belt-tightening and help boost growth.

But he said Athens was also committed to sticking to the fiscal targets pledged to lenders.

“We will not allow Greece to revert to the era of deficits and fiscal derailment,” he told an audience of officials, diplomats and businessmen.

Tsipras promised a phased reduction of the corporate tax to 25 percent from 29 percent from next year, as well as an average 30 percent reduction in a deeply unpopular annual property tax on homeowners, rising to 50 percent for low earners.

He also said a pledge to maintain a primary budget surplus at the equivalent of 3.5 percent of gross domestic product could be achieved without further pension cuts, and that he would discuss this with the European Commission.

The government had been expected to announce further pension cuts next year — a deeply controversial measure in a country where high unemployment means that pensioners are occasionally the primary family earners. It is also a group that has been targeted for cutbacks more than a dozen times since 2010.

The leftist premier said he would also reinstate labor rights and increase the minimum wage. And he said the state would either reduce or subsidize social security contributions for certain sections of the workforce.
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President Donald Trump concedes that some Apple Inc. products may become more expensive if his administration imposes “massive” additional tariffs on Chinese-made goods, but he says the tech company can fix the problem by moving production to the U.S.

“Start building new plants now. Exciting!” Trump said Saturday in a tweet aimed at the Cupertino, California, company.

This week, Apple said that a proposed additional round of tariffs on $200 billion in Chinese imports would raise prices on some of its products, including the Apple Watch and the Mac mini.

The company is highly exposed to a trade war between the U.S. and China. It makes many of its products for the U.S. market in China, and it also sells gadgets including the iPhone in China, making them a potential target for Chinese retaliation against the Trump tariffs.

Trump tweeted Saturday that “Apple prices may increase because of the massive Tariffs we may be imposing on China — but there is an easy solution where there would be ZERO tax, and indeed a tax incentive,” if the company made its products in the U.S. instead of China.

Apple didn’t immediately respond to a request for comment. The company has not announced plans to move manufacturing from China to the U.S.

‘Tax on U.S. consumers’

In its letter this week to the Office of the U.S. Trade Representative, Apple said that “because all tariffs ultimately show up as a tax on U.S. consumers, they will increase the cost of Apple products that our customers have come to rely on in their daily lives.”

The company said tariffs would hit “a wide range of Apple products,” including computers, watches, adapters, chargers and tools used in its U.S. manufacturing, repair and data centers. Apple said the tariffs would raise the cost of its U.S. operations and put it at a disadvantage to foreign rivals.

The White House has accused China of stealing U.S. intellectual property and forcing American companies to share their technology with Chinese companies. The tariffs would pressure China to stop that behavior, the administration has said. Apple said “it is difficult to see” how tariffs would advance the government’s goal.

The presidential tweet was the latest salvo in a dispute between the Trump administration and companies that fear tariffs will hurt their business.

The Trump administration has imposed tariffs on $50 billion worth of imports from China, mostly equipment and material used by manufacturers. CEO Tim Cook said in July that those measures had no effect on Apple. The company is concerned, however, about the Trump administration’s proposal to add 25 percent duties on another $200 billion in Chinese goods, including a wider assortment of consumer-related items.
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U.S. President Donald Trump said on Friday the United States and Japan have begun discussion over trade, saying that Tokyo “knows it’s a big problem” if an agreement cannot be reached, and that India has also asked to start talks on a trade deal.

“We’re starting that,” Trump told reporters aboard Air Force One. “In fact Japan has called us … they came last week.”

“If we don’t make a deal with Japan, Japan knows it’s a big problem,” he added.

Later in a speech in Sioux Falls, South Dakota, Trump said:

“India called us the other day. They said we’d like to start doing a trade deal. First time.”

“They wouldn’t talk about it with the previous administrations. They were very happy with the way it was,” he said without giving further details.

Trump, who is already challenging China, Mexico, Canada and the European Union on trade issues, has expressed displeasure about his country’s large trade deficit with Japan, but had not asked Tokyo to take specific steps to address the imbalance.

On Thursday, though, CNBC reported he had told a Wall Street Journal columnist he might take on trade issues with Japan, causing the dollar to slip against the yen. The White House said Trump would push for fair trade.

“The president has been clear that he will fight to promote free, fair, and reciprocal trade with countries around the world, including Japan, that impose a range of restrictions on U.S. market access,” White House spokeswoman Lindsay Walters said in a statement.

“The United States and Japan have been in close contact on ways to address such barriers, including through the U.S.-Japan Economic Dialogue.”
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China’s trade surplus with the United States reached a record $31 billion in August, despite hefty tariffs recently imposed on Chinese goods. 

The news of the surplus came just hours after U.S. President Donald Trump threatened to impose another $267 billion worth of tariffs on Chinese imports, which would cover virtually all the goods China imports to the United States. 

The potential tariffs would come on top of punitive levies on $50 billion in Chinese goods already in place as well as another $200 billion that Trump says “could take place very soon.”

He told reporters traveling with him to Fargo, North Dakota “behind that, there’s another $267 billion ready to go on short notice if I want.”

“That changes the equation,” he added.

Such a move would subject virtually all U.S. imports from China to new duties.

The president’s comments Friday came one day after a public comment period ended on his proposal to add duties on $200 billion of Chinese imports.

White House economic adviser Larry Kudlow said on Friday the Trump administration would evaluate the public comments before making any decisions on the new proposed tariffs.

The U.S. Trade Representative’s office received nearly 6,000 comments during seven days of public hearings on the proposal.

The Trump administration has argued that tariffs on Chinese goods would force China to trade on more favorable terms with the United States.

It has demanded that China better protect American intellectual property, including ending the practice of cyber theft. The Trump administration has also called on China to allow U.S. companies greater access to Chinese markets and to cut its U.S. trade surplus.

China has retaliated to the U.S. tariffs on $50 billion in Chinese imports with an equal amount of import taxes on U.S. goods. It has also threatened to retaliate against any potential new tariffs. However, China’s imports from the United States are $200 billion a year less than American imports from China, so it would run out of room to match U.S. sanctions.
…

U.S. President Donald Trump is threatening to impose tariffs on another $267 billion worth Chinese imports, which would cover virtually all the goods China imports to the United States.

The potential tariffs would come on top of punitive levies on $50 billion in Chinese goods already in place, as well as tariffs on another $200 billion worth of goods that Trump says “could take place very soon.”

He told reporters traveling with him to Fargo, North Dakota, on Friday that “behind that, there’s another $267 billion ready to go on short notice if I want.”

“That changes the equation,” he added.

Such a move would subject virtually all U.S. imports from China to new duties.

The president’s comments came one day after a public comment period ended on his proposal to add duties on $200 billion worth of Chinese imports. White House economic adviser Larry Kudlow said Friday that the Trump administration would evaluate the public comments before making any decisions on the new proposed tariffs.

The U.S. trade representative’s office received nearly 6,000 comments during seven days of public hearings on the proposal.

The Trump administration has argued that tariffs on Chinese goods will force China to trade on more favorable terms with the United States. It has demanded that China better protect American intellectual property, including ending the practice of cybertheft. The Trump administration has also called on China to allow U.S. companies greater access to Chinese markets and to cut its U.S. trade surplus.

China has retaliated against the U.S. tariffs on $50 billion in Chinese imports with import taxes on an equal amount of U.S. goods. It has also threatened to retaliate against any new tariffs. However, China’s imports from the United States are worth $200 billion a year less than American imports from China, so it would run out of room to match U.S. sanctions.
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Millions of people covered under the Affordable Care Act will see only modest premium increases next year, and some will get price cuts. That’s the conclusion from an exclusive analysis of the besieged but resilient program, which still sparks deep divisions heading into this year’s midterm elections.

The Associated Press and the consulting firm Avalere Health crunched available state data and found that “Obamacare’s” health insurance marketplaces seem to be stabilizing after two years of sharp premium hikes. And the exodus of insurers from the program has halted, even reversed somewhat, with more consumer choices for 2019.

The analysis found a 3.6 percent average increase in proposed or approved premiums across 47 states and Washington, D.C., for next year. This year the average increase nationally was about 30 percent. The average total premium for an individual covered under the health law is now close to $600 a month before subsidies.

For next year, premiums are expected either to drop or increase by less than 10 percent in 41 states with about 9 million customers. Eleven of those states are expected to see a drop in average premiums. In six other states, plus Washington, D.C., premiums are projected to rise between 10 percent and 18 percent.

Insurers also are starting to come back. Nineteen states will either see new insurers enter or current ones expand into more areas. There are no bare counties lacking a willing insurer.

Even so, Chris Sloan, an Avalere director, says, “This is still a market that’s unaffordable for many people who aren’t eligible for subsidies.”

Nearly nine in 10 ACA customers get government subsidies based on income, shielding most from premium increases. But people with higher incomes, who don’t qualify for financial aid, have dropped out in droves.

It’s too early to say if the ACA’s turnabout will be fleeting or a more permanent shift. Either way, next year’s numbers are at odds with the political rhetoric around the ACA, still heated even after President Donald Trump and congressional Republicans failed to repeal the law last year.

Trump regularly calls “Obamacare” a “disaster” and time again has declared it “dead.” The GOP tax-cut bill repealed the ACA requirement that Americans have health insurance or risk fines, effective next year. But other key elements remain, including subsidies and protection for people with pre-existing conditions. Democrats, meanwhile, accuse Trump of “sabotage,” driving up premiums and threatening coverage.

The moderating market trend “takes the issue away from Republican candidates” in the midterm elections, said Mark Hall, a health law and policy expert at Wake Forest University in North Carolina. “Part of the mess is now their fault, and the facts really don’t support the narrative that things are getting worse.”

Market stability also appears to undercut Democrats’ charge that Trump is undermining the program. But Democrats disagree, saying the ACA is in danger while Republicans control Washington, and that premiums would have been even lower but for the administration’s hostility.

“Voters won’t think that the Trump threat to the ACA has passed at all, unless Democrats get at least the House in 2018,” said Bill Carrick, a strategist for Sen. Dianne Feinstein, D-Calif., whose re-election ads emphasize her support for the health law.

As if seconding Democrats’ argument, the Trump administration has said it won’t defend the ACA’s protections for pre-existing conditions in a federal case in Texas that could go to the Supreme Court. A new Kaiser Family Foundation poll found that Americans regardless of partisan identification said those protections should remain the law of the land.

In solidly Republican Arkansas, Democratic state legislator and cancer survivor Clarke Tucker is using the ACA in his campaign to try to flip a U.S. House seat from red to blue. Tucker, 37, says part of what made him want to run is the House vote to repeal the ACA last year and images of Trump and GOP lawmakers celebrating at the White House.

Business analysts say the relatively good news for 2019 is partly the result of previous premium increases, which allowed insurers to return to profitability after losing hundreds of millions of dollars.

“They can price better, and they can manage this population better, which is why they can actually make some money,” said Deep Banerjee of Standard & Poor’s.

Repeal of the ACA’s requirement to carry insurance doesn’t seem to have had a major impact yet, but Banerjee said there’s “a cloud of uncertainty” around the Trump administration’s potential policy shifts. Yet some administration actions have also helped settle the markets, such as continuing a premium stabilization program.

April Box of Spokane Valley, Washington, lives in a state where premiums could rise substantially since insurers have proposed an 18 percent increase. In states expecting double-digit increases, the reasons reflect local market conditions. Proposed increases may ultimately get revised downward.

Box is self-employed as a personal advocate helping patients navigate the health care system. She has an ACA plan, but even with a subsidy her premiums are expensive and a high deductible means she’s essentially covered only for catastrophic illness.

“I’m choosing not to go to the doctor, and I’m saying to myself I’m not sick enough to go to the doctors,” Box said. “We need to figure out how to make it better and lower the price.”

Now in her 50s, Box was born with dislocated hips. She worries she could be uninsurable if insurers are allowed to go back to denying coverage for pre-existing conditions. She might need another hip surgery.

“It needs to be a level playing field for everybody,” said Box. “We need to have universal coverage – that is really the only answer.”

Tennessee is a prime example of the ACA’s flipped fortunes.

Last year, the state struggled to secure at least one insurer in every county. But approved rates for 2019 reflect an 11 percent average decrease. Two new insurers – Bright Health and Celtic_ have entered its marketplace, and two others – Cigna and Oscar – will expand into new counties.

Tennessee Republican Sen. Lamar Alexander called that a “welcome step,” but argued rates could have been even lower if congressional Democrats had supported a market stabilization bill. Democrats blame Republicans for the failure.

To calculate premium changes, Avalere and The Associated Press used proposed overall individual marketplace rate filings for 34 states and D.C., and final rates for 13 states that have already approved them. Data was not available for Massachusetts, Maryland and Alabama. The average rate change calculations include both on-exchange and off-exchange plans that comply with ACA requirements. The government isn’t expected to release final national figures until later this fall.

 
…

Hiring picked up in August as U.S. employers added a strong 201,000 jobs, a sign of confidence that consumers and businesses will keep spending despite the Trump administration’s conflicts with U.S. trading partners.

The Labor Department said Friday the unemployment rate remained 3.9 percent, near an 18-year low. 

Americans’ paychecks grew at a faster pace in August. Average hourly wages rose last month and are now 2.9 percent higher than they were a year earlier, the fastest year-over-year gain in eight years. Still, after adjusting for inflation, pay has been flat for the past year.

The economy is expanding steadily, fueled by tax cuts, confident consumers, greater business investment in equipment and more government spending. Growth reached 4.2 percent at an annual rate in the April-June quarter, the fastest pace in four years.

Most analysts have forecast that the economy will expand at an annual pace of at least 3 percent in the current July-September quarter. For the full year, the economy is on track to grow 3 percent for the first time since 2005. 

Consumer confidence rose in August to its highest level in nearly 18 years. Most Americans feel that jobs are widely available and expect the economy to remain healthy in the coming months, according to the Conference Board’s consumer confidence survey.

The buoyant mood is lifting spending on everything from cars to restaurant meals to clothes. Consumers’ enthusiasm is even boosting such brick-and-mortar store chains as Target, Walmart and Best Buy, which have posted strong sales gains despite intensifying competition from online retailers.

In August, factories expanded at their quickest pace in 14 years, according to a survey of purchasing managers. A manufacturing index compiled by a trade group reached its highest point since 2004. Measures of new orders and production surged, and factories added jobs at a faster pace than in July.

Not all the economic news has been positive. Higher mortgage rates and years of rapid price increases are slowing the housing market. Sales of existing homes dropped in July for a fourth straight month.

And wages are still rising only modestly, even after more than nine years of economic expansion and an ultra-low unemployment rate.

Many economists also worry President Donald Trump will soon follow through on a threat to impose tariffs of up to 25 percent on $200 billion of imports from China. That would be in addition to $50 billion in duties already imposed. That move could shave as much as a quarter-point off growth over the next year, Mark Zandi, chief economist at Moody’s Analytics, has estimated. 

For now, there’s little sign that companies are worried enough about a trade war to slow hiring. Businesses are increasingly reluctant to even lay off workers, in part because it would be difficult to replace them at a time when qualified job applicants have become harder to find.

On Thursday, the government said the number of people seeking unemployment benefits — a proxy for layoffs — amounted to just 203,000 last week, the fewest total in 49 years.
…

Trump administration officials and Canadian negotiators are resuming talks to try to keep Canada in a North American trade bloc with the United States and Mexico.

“We are looking forward to constructive conversations today,” Canadian Foreign Affairs Minister Chrystia Freeland told reporters as she entered a meeting with U.S. Trade Rep. Robert Lighthizer.

Last week, the United States and Mexico reached a preliminary agreement to replace the 24-year-old North American Free Trade Agreement. But those talks excluded Canada, the third NAFTA country.

Freeland flew to Washington last week for four days of negotiations to try to keep Canada within the regional trade bloc. The U.S. and Canada are sparring over issues including U.S. access to Canada’s protected dairy market and American plans to protect some drug companies from generic competition.

 
…

An international money transfer company has launched an online service for East Africans to send and receive money more easily. Analysts say WorldRemit will lower the cost of transferring money and boost African trade and economies.

Africa has become a thriving market for money transfer companies as its telecommunication facilities improve and its economies grow.

WorldRemit, a British-based money transfer company, recently launched a new digital service in four East African countries. The company facilitates the transfer of at least $1.6 billion to Africa each year.

The co-founder and the head of WorldRemit, Ismail Ahmed, told VOA how money transfers in Africa have changed over the years.

“When we launched our services, 99 percent of remittances were cash both on the sending and receiving side. But today that is changing fast and in the next few years we think as much as 50 to 60 percent of international remittances would move from traditional physical cash, traditional remittances, to digital. And that’s why our services has grown very fast in the last few years,” he said.

Ahmed said that as transactions become digital, the cost of each transfer comes down, and tracking money becomes easier.

“It’s easier for businesses and individuals to move within countries but also across countries. It’s easier to fight financial crime because once the transaction becomes digital, there is an audit trail compared to cash where there is no audit trail,” he said.

Gerrishon Ikiara is an international economic affairs lecturer at the University of Nairobi. He said digital money transfers will boost trade within Africa — but notes that some countries still lack the necessary connections.

“Obviously, the main challenge is the level of infrastructure, because a country without the good infrastructure in terms of electricity and telecommunication infrastructure will make it a bit difficult,” said Ikiara.

The World Bank says $37.8 billion was sent to Africa through remittances in 2017. This year, the amount is expected to be $39 billion.
…

First it was Argentina, quickly followed by Turkey. Now anxious investors and policy-makers are watching with alarm the plummeting currencies of several emerging-market economies, most of which have borrowed heavily in dollars.

The nosediving currencies are prompting fears of a repeat of the 1997 Asian financial crash or the “Tequila Effect” of Mexico’s 1994 financial crisis. Or is something even worse coming — a financial contagion to compare with 2008?

Argentina’s peso dropped 29 percent against the U.S. dollar in August, the worst performer among major emerging-market currencies. Turkey’s currency followed closely, with a 25 percent slide.South Africa’s rand saw an almost 10 percent drop. The Indonesian rupiah fell to its weakest level since the 1997 Asian financial crisis, while India’s currency slid into unprecedented territory against the dollar.

September has seen no major uplift in those currencies. The Turkish lira is down 40 percent to the U.S. dollar this year, sparking mounting alarm over the sustainability of the country’s sizable dollar-denominated debts held primarily by its banks and businesses rather than the government.

The foreign exchange markets are jittery with traders watching to see if more countries start joining the troubled list, which would indicate contagion is underway. African countries like Angola, Ghana, Ethiopia, and Mozambique could be vulnerable. And in a worst-case scenario even more developed economies like Chile, Poland and Hungary, which are also shouldering large foreign-currency debts above 50 percent of their GDPs, could be impacted, say some financial analysts.

Corporate debt in emerging and developing economies is significantly larger than it was before the 2008 global financial crisis.The bigger the debt, the harder the fall.

“The risk is increasing in those countries,” Bertrand Delgado, director of global markets for Societe Generale in New York, has warned.

There is general consensus why emerging markets are in turmoil. Three main developments are blamed:

1 – The impact on market sentiment from U.S. President Donald Trump’s tit-for-tat trade war with China and others

2 – Rising U.S. interest rate that has prompted global investors to exit emerging markets to chase yield in dollar investments

3 – The winding down of post-2008 quantitative easing by the U.S. Federal Reserve and the European Central Bank, which has reduced liquidity and the availability of cheap money for governments and businesses in emerging markets to borrow.

A global financial crash?

Marcus Ashworth of Bloomberg cautioned last week the emerging-markets sell-off looks contagious.

“The difficulties for emerging markets have entered a new phase.What were once clearly country-specific crises, well contained within their borders, are bleeding across the world,” he warned.

Ashworth, a columnist and a veteran of the banking industry, most recently as chief markets strategist at Haitong Securities in London, added, “One emerging country’s problems have become other emerging countries’ problems, and it’s hard to see how to break the cycle.”

Other analysts dispute that contagion is underway, saying each of the troubled states have their own idiosyncratic problems and country-specific challenges, although they acknowledge the turmoil could mount with the U.S. Federal Reserve expected to raise interest rates several times this year.

In a note to investors, DBS, a Singapore-based international financial services group, warned the currencies of Argentina and Turkey “have been struggling with rising U.S. rates since the start of the year, due to deficits in their fiscal and current account balances.

“Heightened trade tensions threatening to erupt into a full-blown trade war could prompt, DBS said, disorderly capital outflows leading to “financial instability, especially in countries that have high external debt levels.”

Britain’s The Economist magazine argues the weakness in emerging-market currencies “is not fundamentally contagious” and the fallout can be contained.Western lenders including banks will be impacted, it said, as emerging-market borrowers struggle to repay dollar and other foreign-currency debts now worth more in terms of their own currencies. “But it would not threaten their [Western lenders’] solvency,” it said.

Optimists say for all the wider currency woes and the economic weakness of Argentina and Turkey, many major emerging-market countries are doing well.

India’s GDP was growing at an 8 percent rate ending June. Mexico’s peso is steady and it appears to have concluded trade negotiations with the Trump White House, which markets are viewing favorably.

The optimists say the global scare is being fanned by screaming, doom-laden headlines, pointing out that in 2013, when the U.S. Federal Reserve started to cease Quantitative Easing, Brazil, India, Indonesia, Turkey and South Africa all suffered from currency depreciation, but they soon regained their footing.

The biggest emerging-market risk, though, is that rattled global investors could be so alarmed by currency turmoils that they ignore economic fundamentals and stampede away from emerging-market countries, compounding currency falls, triggering indirect contagion, and adding to debt burdens.
…

A tiny Alaska Native village has experienced a boom in tourism in recent years as polar bears spend more time on land than on diminishing Arctic sea ice.

More than 2,000 people visited the northern Alaska village of Kaktovik on the Beaufort Sea last year to see polar bears in the wild, Alaska’s Energy Desk reported Monday. 

The far north community is located on north shore of Barter Island on the Beaufort Sea coast in an area where rapid global warming has sped up the movement of sea ice, the primary habitat of polar bears. As ice has receded to deep water beyond the continental shelf, more bears are remaining on land to look for food. 

The village had fewer than 50 visitors annually before 2011, said Jennifer Reed of the Arctic National Wildlife Refuge.

“Today we’re talking about hundreds and hundreds of visitors, many from around the world, each year,” Reed said. 

Polar bears have always been a common sight on sea ice near Kaktovik, but residents started noticing a change in the mid-1990s. More bears seemed to stay on land, and researchers began taking note of more female bears making dens in the snow on land instead of on the ice.

U.S. Fish and Wildlife Service biologists began hearing reports of increasing numbers of polar bears in the area in the early 2000s, Reed said. As more attention was given to the plight of polar bears about a decade ago, more tourists stated heading to Kaktovik.

Bears stranded

Most tourists visit in the fall, when bears are forced toward land because sea ice is the farthest away from the shore. Some bears become stranded near Kaktovik until the sea freezes again in October or November.

The fall is also when residents of Kaktovik kill three bowhead whales. Bruce Inglangasak, an Inupiaq subsistence hunter who offers wildlife viewing tours, said residents were unsure how tourists would react to whaling. 

“The community was scared about, you know, activists that were going to try to get us to shut down the whaling — subsistence whaling,” Inglangasak said. “But that’s not true.”

Inglangasak said he’s been offering polar bear tours since 2003 or 2004. Most of his clients are from China and Europe, as well as from the Lower 48 U.S. states, and arrive in Katovik on charter planes from Anchorage and Fairbanks. 

Many tourists stay several days in the village, which has two small hotels, Inglangasak said.
…

If you already subscribe to digital services like Netflix to binge on TV shows and Spotify to groove to an endless mix of music, the auto industry might have a deal for you: Subscribe to your next car as well.

Make that cars, plural. Some of these packages — which charge a monthly fee for the bundled use of a car, insurance and maintenance — let you trade in your vehicle on a regular basis, sometimes almost as readily as you can skip to a new tune on Spotify.

These still-developing car subscription programs are gaining traction among motorists who don’t want to be locked into the hassles of car ownership or even multiyear leasing commitments. All they want is a vehicle available whenever they want or need it.

“It feels like Christmas morning every time they bring me a new car,” said Steve Barnes, a video producer who subscribes to a high-end vehicle subscription program offered through Clutch Technologies, a startup operating in the Atlanta area.

Although they’re still in their infancy, car subscriptions are hooking more motorists as both long-established automakers and startups roll out plans.

How it works

Ford, a 115-year-old automaker with a network of more than 3,000 dealers, expanded into car subscriptions about 16 months ago through Canvas, a subsidiary in San Francisco.

Canvas offers a variety of used, once-leased Ford and Lincoln models as subscriptions that cost anywhere from $379 per month (for a Ford Fiesta subcompact) to $1,125 per month (for a Lincoln Navigator luxury SUV).

Those plans, however, impose driving limits of 500 miles a month. Subscribers can pay extra for higher limits — $35 per month for an additional 350 miles, for instance, or $100 per month for unlimited travel. Unused miles in any given month can be rolled over to the next one. If Canvas customers exceed the monthly mileage limits under their plan, they are charged an additional 15 cents per mile for a Ford car and slightly more for a Lincoln vehicle.

So far, Canvas has limited subscriptions to the San Francisco and Los Angeles area. In its first 16 months in California, thousands of subscribers have signed up for its subscription service while collectively driving about 8.5 million miles, according to the company.

“People are generally changing the way they are working, they are changing the way they are living and they are generally changing the way they are consuming things,” Canvas CEO Ned Ryan said. “Subscriptions are going to be a very large and growing share of how people consume automobiles.”

About a third of Canvas customers decided to subscribe to cars after moving or some other major event that left them reluctant to make a bigger commitment to leasing or owning, Ryan said. Others just like the simplicity and convenience offered by a car subscription, he said.

Temporary arrangement

Liz Dreskin of San Rafael, California, signed up for Canvas earlier this year to help her college-age kids get around at home during their summer break. Both are under the company’s 21-year-old age limit, so Dreskin got a vehicle for herself while allowing her children to drive the BMW she already owned.

After starting off with a sports utility vehicle from Canvas, she decided to pay $99 to switch to a 2015 Mustang. Although she plans to suspend her $500 monthly subscription at the end of September, she intends to start it up again when her kids return for the holidays. She’s also recommending the service to a friend whose current car is breaking down.

“I could totally see myself doing this in the future so I don’t have to deal with car insurance and car payments,” said Dreskin, 52.

Luxury automakers such as BMW, Mercedes-Benz, Porsche and General Motors’ Cadillac brand also are offering subscription programs, but those are primarily catering to affluent drivers who want to try out a variety of expensive vehicles.

Barnes, the video producer, signed up with Clutch in 2016 for access to luxury vehicles. The divorced father will get a sports utility vehicle when he has custody of his daughters or a Tesla sports car or something else fun to drive when he’s headed out on the town with his current wife.

He pays about $1,400 per month for his Clutch subscription, substantially more than the roughly $900 per month he used to pay for a lease on a Tahoe and his insurance policy. But he says he can’t imagine ever owning or leasing a car again now that he’s driven dozens of different vehicles that he estimates would have cost him more than $1 million to own.

“I am definitely a ‘tech head’ who had always fantasized about being able to get whatever car you want,” Barnes said. 
…

U.S. manufacturing activity accelerated to more than a 14-year high in August, boosted by a surge in new orders, but increasing bottlenecks in the supply chain because of a robust economy and import tariffs could restrain further growth.

The Institute for Supply Management (ISM) survey was at odds with another survey published on Tuesday that suggested a peak in manufacturing and pointed to a slowdown in the months ahead against the backdrop of a strong dollar. Recent surveys have also signaled a cooling in regional factory activity.

“The surge in the ISM manufacturing index is difficult to square with other evidence, which indicate that growth in the factory sector has started to slow,” said Michael Pearce, a senior U.S. economist at Capital Economics in New York.

“With export orders now waning as a result of the dollar’s rapid appreciation over the past few months, we still think that growth in the factory sector will slow in the coming quarters.”

The ISM said its index of national factory activity jumped to 61.3 last month, the best reading since May 2004, from 58.1 in July. A reading above 50 indicates growth in manufacturing, which accounts for about 12 percent of the U.S. economy.

The ISM described demand as remaining “robust,” but cautioned that “the nation’s employment resources and supply chains continue to struggle.”

According to the ISM, survey respondents were “again overwhelmingly concerned about tariff-related activity, including how reciprocal tariffs will

impact company revenue and current manufacturing locations.”

President Donald Trump’s “America First” trade policy has led to an escalating trade war with China and tit-for-tat import tariffs with other trading partners, including the European Union, Canada and Mexico.

Trump has defended the duties on steel and aluminum imports and a range of Chinese goods as necessary to protect American industries from what he says is unfair foreign competition.

Economists have warned that the tariffs could disrupt supply chains, undercut business investment and slow the economy’s momentum. The economy grew at a 4.2 percent annualized rate in the second quarter, almost double the 2.2 percent in the January-March period.

The dollar rose against a basket of currencies, while prices of U.S. Treasuries fell. Stocks on Wall Street were trading lower.

​Impact of tariffs

The ISM’s new-orders sub-index increased to a reading of 65.1 last month from 60.2 in July. A measure of export orders, however, fell in August, most likely reflecting the dollar’s more than 5.0 percent rise this year against the currencies of the United States’ main trade partners.

The survey’s supplier deliveries index jumped to a reading of 64.5 last month, highlighting the rising bottlenecks in the supply chain, from 62.1 in July. It hit a 14-year high of 68.2 in June. Economists said the strong economy, marked by a labor market that is near or at full employment, as well as the import duties were behind the delays in deliveries.

“Bottlenecks in production will support inflation, but the constraints have yet to become overly binding,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania.

Factories reported hiring more workers last month, with production increasing sharply. That bodes well for August’s employment report, which is scheduled to be released Friday.

Manufacturing payrolls have increased solidly this year.

In the computer and electronic products industry, manufacturers said most suppliers were “waiting to re-evaluate potential price increases until September.”

Machinery manufacturers said while raw material costs appeared to be “leveling off,” and most suppliers “are willing and able to suppress cost increases,” the impact of tariffs remained a concern.

In a separate survey Tuesday, data firm Markit said its U.S. Manufacturing Purchasing Managers’ Index fell to a nine-month low of 54.7 in August from a reading of 55.3 in July.

Manufacturers reported a decline in new orders, with exports the main source of weakness. 

Markit said some of the slowdown in factory activity reflected widespread shortages of inputs, hauliers and labor, leading to a further buildup of backlogs of work.

It said tariffs were exacerbating supply shortages and also driving prices higher. Almost two-thirds of companies surveyed reporting higher input prices explicitly blamed tariffs for the increased costs, Markit said.

“When we look across the recent survey data, it appears that activity has cooled somewhat lately, but remains at a solid level,” said Daniel Silver, an economist at J.P. Morgan in New York.

A third report from the Commerce Department showed construction spending barely rose in July as increases in homebuilding and investment in public projects were overshadowed by a sharp drop in private nonresidential outlays.
…

Turkey saw the inflation rate rise to nearly 18 percent in August, a 15-year high fueled by a collapse in the Turkish lira, which fell more than 20 percent over the past few weeks.

The rising inflation and a falling currency are stoking fears Turkey is on the verge of financial and economic crisis.

“It’s the beginning of the slippery slope. It’s going to get worse unless there is a miraculous improvement in the exchange rate,” political analyst Atilla Yesilada of Global Source Partners said. “We’ve reached the stage where there is nothing to anchor price expectations. People simply can’t gauge what prices or wages or costs will be next month.”

“It’s a very dismal set of numbers. The likelihood is headline inflation will reach 20 percent in (the) coming months,” economist Inan Demir of Nomura Securities said. “This is clearly a set of numbers that warrant a monetary response from inflation targeting the central bank.”

The Turkish Central Bank, in a statement on its website, vowed to act, promising to use all tools at its disposal and reshape its monetary policy stance at a Sept. 13 meeting where they will discuss interest rates.

The lira recouped much of its initial heavy losses following the release of the latest inflation figures.

“This (the central bank statement) is seen as a signal for a rate hike in that meeting,” Demir said. “Even though the wording of the statement is very uncertain, the expectation of tightening are curbing lira weakness after bad inflation numbers.”

International criticism

International investors sharply criticized the central bank for failing to aggressively raise interest rates to rein in inflation and defend the currency. Turkish President Recep Tayyip Erdogan’s influence is widely seen as responsible for the failure of the bank to act. Erdogan has repeatedly voiced opposition to raising interest rates.

“There will be a massive sell-off to the point of panic if they don’t raise rates,” Yesilada said. “This time, they have no option, even if they meant something else (in their statement), as everyone interpreted it as rates will be hiked. But there are two questions: by how much, and will it help at all?” he added.

Investors and analyst claim the central bank needs to raise rates by at least 4 percent, while some suggest a 10 percent raise is needed to avoid further drops in the currency, which analysts warned would open the lira to further pressure.

“In such a scenario, Turkish residents would want to hold more FX (foreign exchange) rather than Turkish lira … to protect their savings. That is a big risk to the currency,” Demir said.

Already, 40 percent of individual accounts in banks are in foreign currency.

However, an aggressive increase in rates may not be enough to rein in inflation or defend the lira, analysts warned.

“The concerns are on multiple fronts,” Demir said. 

“What Turkish policy needs to do is straightforward,” he added. “They need to hike rates, tighten fiscal policy (cut government spending) and ease tensions with the United States, removing the threat of further sanctions by releasing (American) pastor (Andrew) Brunson.

“There is a way out of this, but it’s not obvious that the policymakers will take that way,” Demir said.

US trade tariffs 

Last month’s imposition of trade tariffs by U.S. President Donald Trump over the ongoing detention of Brunson was the trigger for the latest rout in the Turkish currency. Brunson is on trial on terrorism charges, a case dismissed by Washington as politically motivated.

Ignoring U.S. pressure, Turkey’s top appeals court judge, Rustu Cirit, on Monday supported Erdogan’s refusal to release Brunson, saying the pastor’s release is a matter only for the courts.

“To use brute force to reverse this fact, which is a basic principle of contemporary democracies and law of nations, would mean weakening human rights, rather than strengthening them,” Cirit said.

Trump is warning of further sanctions against Turkey if Brunson is not released. American regulatory authorities are considering reportedly a multibillion-dollar fine against Turkish state-controlled Halkbank for violations of Iranian sanctions.

Analysts warn the financial implications of an escalation of U.S.-Turkish tensions will continue to undermine confidence in the lira. However, Erdogan continues to take a robust stance against Washington, insisting the Turkish economy remains strong.

“The list of concerns is long, definitely, but the chief concern I have right now is the policymakers. They need to accept first that there is a significant problem that needs to be addressed,” Demir said. “But we heard this morning from finance minister (Berat) Albayrak that short-term fluctuations in inflation are normal. ”

Turkey already seems set to face a severe recession. Similar depreciations of the currency in past decades was accompanied by a double-digit contraction of the economy. 

Analysts warn the stress on the economy will only grow.

“Each day, Ankara lingers or prevaricates the likelihood of a disaster event increases. Right now, the threat is very low, it’s manageable. But as winter approaches, the likelihood increases exponentially,” Yesilada said.
…

Yemen’s government says it is giving civil servants and pensioners pay raises, after protests against the country’s woeful economy nearly paralyzed a major port city Sunday.

Officials have not said when the raises would take effect or how much they will be.

Demonstrations against the economy in the port of Aden continued Monday. Many shops were closed, and some people burned tires in the streets.

Some of the marchers demanded to be paid in dollars, accusing senior officials of taking their salaries in the U.S.-based currency while paying the rank-and-file in the increasingly weak Yemeni rial.

The rial has lost more than half its value against the dollar since Iranian-backed Houthi rebels seized the capital of Sanaa in 2014, sending the Western-recognized government into exile in Saudi Arabia.

It has since returned to set up shop in Aden.

Airstrikes

Meanwhile, the Houthis are demanding a war crimes investigation against the Saudi-led coalition after an airstrike last month that killed 40 children.

In an appeal Monday to the International Criminal Court, the Houthis asked the court to look into its “humanitarian conscience.”

A coalition missile struck a market in a Yemeni town near the Saudi border last month, killing 51 people. Among the dead were 40 children on a school bus coming back from a summer camp outing.

The coalition called the airstrike a “mistake.” It promised to hold those behind the attack legally responsible and to compensate the victims.

But the Houithis accuse the Saudis of being both the “judge and the jury” and “making light” of the civilian deaths.

U.N. human rights officials have said they believe both sides in Yemen may be responsible for war crimes.

The Saudi-led airstrikes have compounded the misery in Yemen, which is not only one of the world’s poorest nations, but is also on the edge of famine.

The U.N. has said about 80 percent of Yemeni civilians lack enough food and medical care.

The coalition airstrikes have obliterated entire neighborhoods, including hospitals and schools.
…

It’s coal people like miner Steve Knotts, 62, who make West Virginia Trump Country.

So it was no surprise that President Donald Trump picked the state to announce his plan rolling back Obama-era pollution controls on coal-fired power plants.

Trump left one thing out of his remarks, though: northern West Virginia coal country will be ground zero for increased deaths and illnesses from the rollback on regulation of harmful emission from the nation’s coal power plants.

An analysis done by his own Environmental Protection Agency concludes that the plan would lead to a greater number of people here dying prematurely, and suffering health problems that they otherwise would not have, than elsewhere in the country, when compared to health impacts of the Obama plan.

Knotts, a coal miner for 35 years, isn’t fazed when he hears that warning, a couple of days after Trump’s West Virginia rally. He says the last thing people in coal country want is the government slapping down more controls on coal — and the air here in the remote West Virginia mountains seems fine to him.

People here have had it with other people telling us what we need. We know what we need. We need a job,” Knotts said at lunch hour at a Circle K in a tiny town between two coal mines, and 9 miles down the road from a coal power plant, the Grant Town plant.

The sky around Grant Town is bright blue. The mountains are a dazzling green. Paw Paw Creek gurgles past the town.

Clean-air controls since the 1980s largely turned off the columns of black soot that used to rise from coal smokestacks. The regulations slashed the national death rates from coal-fired power plants substantially.

These days pollutants rise from smoke stacks as gases, before solidifying into fine particles — still invisible — small enough to pass through lungs and into bloodstreams.

An EPA analysis says those pollutants would increase under Trump’s plan, when compared to what would happen under the Obama plan. And that, it says, would lead to thousands more heart attacks, asthma problems and other illnesses that would not have occurred.

Nationally, the EPA says, 350 to 1,500 more people would die each year under Trump’s plan. But it’s northern two-thirds of West Virginia and the neighboring part of Pennsylvania that would be hit hardest, by far, according to Trump’s EPA.

Trump’s rollback would kill an extra 1.4 to 2.4 people a year for every 100,000 people in those hardest-hit areas, compared to under the Obama plan, according to the EPA analysis. For West Virginia’s 1.8 million people, that would be equal to at least a couple dozen additional deaths a year.

Trump’s acting EPA administrator, Andrew Wheeler, a former coal lobbyist whose grandfather worked in the coal camps of West Virginia, headed to coal states this week and last to promote Trump’s rollback. The federal government’s retreat on regulating pollution from coal power plants was “good news,” Wheeler told crowds there.

In Washington, EPA spokesman Michael Abboud said Trump’s plan still would result in “dramatic reductions” in emissions, deaths and illness compared to the status quo, instead of to the Obama plan. Obama’s Clean Power Plan targeted climate-changing carbon dioxide, but since coal is the largest source of carbon dioxide from fossil fuels, the Obama plan would have curbed other harmful emissions from the coal-fired power plants as well.

About 160 miles to the south of Grant Town, near the state capital of Charleston, shop owner Doris Keller figures that if Trump thinks something’s for the best, that’s good enough for her.

“I just know this. I like Donald Trump and I think that he’s doing the right thing,” said Keller, who turned out to support Trump Aug. 21 when he promoted his rollback proposal. She lives five miles from the 2,900-megawatt John Amos coal-fired power plant.

“I think he has the best interests of the regular common people at the forefront,” Keller says.

Trump’s Affordable Clean Energy program would dismantle President Barack Obama’s 2015 Clean Power Plan, which has been caught up in court battles without yet being implemented.

The Obama plan targeted climate-changing emissions from power plants, especially coal. It would have increased federal regulation of emissions from the nation’s electrical grid and broadly promoted natural gas, solar power and other cleaner energy.

Trump’s plan would cede much of the federal oversight of existing coal-fired power plants and drop official promotion of cleaner energy. Individual states largely would decide how much to regulate coal power plants in their borders. The plan is open for public review, ahead of any final White House decision.

“I’m getting rid of some of these ridiculous rules and regulations, which are killing our companies … and our jobs,” Trump said at the rally.

There was no mention of the “small increases” in harmful emissions that would result, compared to the Obama plan, or the health risks.

EPA charts put numbers on just how many more people would die each year because of those increased coal emissions.

Abboud and spokeswoman Ashley Bourke of the National Mining Association, which supports Trump’s proposed regulatory rollback on coal emissions, said other federal programs already regulate harmful emissions from coal power plants. Bourke also argued that the health studies the EPA used in its death projections date as far back as the 1970s, when coal plants burned dirtier.

In response, Conrad Schneider of the environmental nonprofit Clean Air Task Force said the EPA’s mortality estimates had taken into account existing regulation of plant emissions.Additionally, health studies used by the EPA looked at specific levels of exposure to pollutants and their impact on human health, so remain constant over time, said Schneider, whose group analyzes the EPA projections.

With competition from natural gas and other cleaner energy helping to kill off more than a third of coal jobs over the last decade, political leaders in coal states are in no position to be the ones charged with enforcing public-health protections on surviving coal-fired power plants, said Vivian Stockman of the Ohio Valley Environmental Coalition.

“Our state is beholden to coal. Our politicians are beholden to coal,” Stockman said outside Trump’s West Virginia rally, where she was protesting. “Meanwhile, our people are being poisoned.”

And when it comes to coal power plants and harm, Schneider said, “when you’re at Grant Town, you’re at Ground Zero.”

Retired coal miner Jim Haley, living 4 miles from the town’s coal-fired power plant, has trouble telling from the smokestack when the plant is even operating.

“They’ve got steam coming out of the chimneys. That’s all they have coming out of it,” Haley said.

Parked near the Grant Town post office, where another resident was rolling down the quiet main street on a tractor, James Perkins listened to word of the EPA’s health warnings. He cast a look into the rear-view mirror into the backseat of his pickup truck, at his 3-year-old grandson, sitting in the back.

“They need to make that safe,” said Perkins, a health-care worker who had opted not to follow his father into the coal mines. “People got little kids.”

 
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Tanned and wearing a swimsuit, So Myong Il walks to the barbecue pit and throws on some clams.

He obviously loves the beach he’s on as well as the rugged, emerald Chilbo mountains that rise abruptly behind it. He loves them enough to forget, for a moment at least, that he is a senior official sent to deliver an ideology-soaked pitch singing their praises and instead lets the natural beauty surrounding him speak for itself.

Comrade So sees great things for North Korean attractions like this.

Hotels, big and small. Tourists from all over the country, maybe the world. “As long as we have the leadership of our respected Marshal,” he says, referring to leader Kim Jong Un, “our future will be bright indeed.”

So wouldn’t think of questioning the leader, but there is a hint of apprehension in his voice. And he isn’t alone.

North Korea is pushing ahead with a new strategy of economic development and the intensified diplomacy with China, South Korea and the United States that such a move requires. But hopes for a better future are mixed with concern over potential downsides of political or social volatility, and something that’s harder to articulate: a fear of the unknown – even if it appears far more promising than the arduous path the country has been on for decades.

Even before announcing in January that he had sufficiently perfected his nuclear arsenal and could start to focus on other things, Kim has held economic development to be his primary long-term concern.

He has allowed markets and entrepreneurialism to flourish and, since succeeding his father as leader seven years ago, has dramatically transformed the skyline of the capital, Pyongyang, with several high-rise districts. The transformation in the east coast city of Wonsan, where Kim has a summer villa, has been almost as spectacular.

As Kim prepares for the 70th anniversary of North Korea’s founding on Sept. 9, his ambitious development plan is being implemented, from the small-time renovation of town halls to the almost biblical-scale mobilization of “soldier-builders,” who are working around the clock to turn the remote northern city of Samjiyon into yet another showcase of Pyongyang-style socialism.

Economic development – and how U.S. capital and know-how could speed it along – was President Donald Trump’s big carrot when he met with Kim in Singapore three months ago to try to negotiate a denuclearization deal.

But Kim’s diplomatic overtures aren’t intended to open the door to American capitalists, a scenario that would make any good party cadre shudder. They are aimed at breaking down support for sanctions and getting the U.S. to step out of the way. Kim’s game is to play China and the U.S. off each other, grab whatever concessions he can along the way and adjust his position as the situation evolves.

In the meantime, lest anyone get the wrong idea, the ruling Workers’ Party of Korea has begun churning out paeans to socialism in its daily newspaper along with anti-capitalism, anti-imperialism screeds that underscore North Korea’s official opposition to essentially anything that might be considered the American way of life. Or, as it’s known in the jargon of North Korea’s propaganda machine, “the imperialists’ bourgeois ideological and cultural poisoning.”

The past few months have been tense in Pyongyang.

Restrictions on some of the movements of foreign diplomats have been tightened, for example, and even requests by The Associated Press to interview government officials or to speak with regular citizens have mostly been denied.

Uncertain of where it might all end up, state-run media have provided only limited coverage of Kim’s meetings with Trump in June and his multiple summits with Chinese President Xi Jinping and South Korean President Moon Jae-in. Reports have portrayed Kim as the consummate statesman, firmly in charge of a carefully considered strategy to make his country safer and more prosperous.

Kim is ardently wooing South Korean investment to help him build the very things Trump was offering: infrastructure, particularly roads and railways, and the development of selected tourism zones. After a high-profile chill last year, he is also actively courting Beijing, which continues to be an essential source of fuel, a key market for North Korea’s coal and other natural resources and a fairly reliable check on U.S. power in the region.

Pyongyang’s explanation for the shift in its foreign policy has been consistent: Having successfully built a credible nuclear deterrent to U.S. aggression, Kim is reaching out to Seoul to join hands in a “for Koreans, by Koreans” effort to secure a lasting peace on the Korean Peninsula, unhindered by the meddling of foreign powers.

Undoubtedly, images of the leader smiling and shaking hands with Trump, whose face had never been on the front pages of their newspapers before, signaled a major and bewildering change to many North Koreans.

But officials have made sure they don’t have much time to ruminate on it.

Normal routines of work and study have been put on hold for large segments of the populace who have been mobilized for the development projects. Tens of thousands of people in Pyongyang, meanwhile, have spent the past several months feverishly preparing for mass rallies and mass games to mark the anniversary.

Mount Chilbo, a collection of rocky peaks and a stretch of largely untouched seashore on the country’s northeastern fringe, is one of North Korea’s most cherished natural wonders.

The first hotel for non-Korean visitors opened in the 1980s, followed in 2004 by homestay-style lodgings near the beach, said So, a North Hamgyong Province People’s Committee official. Together they have a capacity of fewer than 100 guests and only operate from April until early November.

Many North Koreans bring tents and sleep on the beach.

But even in this rustic corner of the country, the pressure to contribute to Kim’s grand development scheme is keenly felt.

So said he would soon travel to China to discuss possible areas of cooperation.

As an indicator of Kim’s success with Beijing, tourism from China is already on the rise. Pyongyang’s longer-term goal, however, is to tap the South Korean market. The idea is that, if handled properly, South Korean tourism would present a chance to promote the North in a positive light and boost its image within South Korea.

That’s a gamble too.

Back in the late 1990s and early 2000s, South Koreans were allowed to visit in a highly regulated and controlled manner, and massive investment from South Korean businesses helped the North fund infrastructure projects in the same Wonsan-Mount Kumgang area that Kim is focusing on now. But it ended badly in 2008 when a South Korean woman who entered a restricted area was shot to death by a North Korean soldier.

So said he believes Chilbo, like Kim’s pet projects in Wonsan, could be a big draw for tourists. But he worries about where the money will come from and what might be lost.

“Whatever we do, we need to protect the natural beauty of this place,” he said.”I think there will be many changes in the coming years. Plans are being discussed. But nothing is decided.”

 
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The International Organization for Migration reports more than 270 Nigerian migrants who recently returned from Libya have completed a skills training course to help them start their own businesses.

Migrants attending this weeklong event in the Nigerian capital Lagos have shared stories of the business frustrations that drove them to try to go to Europe in search of better economic opportunities.

U.N. migration agency spokesman, Paul Dillon, told VOA the migrants also have shared stories of the abuse and suffering they endured at the hands of smugglers and traffickers in Libya. At the same time, he said returnees enrolled in this business course have spoken of their hopes for the future.

“The goal of these types of initiatives is always to give people options and providing them with business skills training, for example. It certainly does that.Start up a small business at home, get hired on by a local company, build your life back in Nigeria. I think that is the goal and also to encourage formal migration efforts,” he said.

This is the 21st training course since the program was started in April 2017. IOM reports more than 2,000 Nigerian returnees have participated in courses given in Lagos, Edo, Nassarawa, Kano and Kaduna States.

Dillon said many of the returnees have become involved in collective reintegration schemes or community-based projects, such as fruit juice, palm oil and plantain processing factories.

He said training now is focused on creating more sustainable businesses, not just on regular trading, buying and selling. Therefore, he said there is greater concentration on agriculture-related businesses, which are more sustainable and more beneficial to the returnees’ communities.

He said IOM, together with the Ministry of Labor and the Lagos Chamber of Commerce and industry are organizing a job fair at the end of September.This, he said, will give returnees the opportunity to meet leaders in Nigeria’s private sector and to search for jobs to match their skills.
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Investment banks which lost out on big payouts for the work on the shelved listing of oil giant Aramco are lining up for a raft of other projects as Saudi Arabia pursues reforms.

Banks including JPMorgan and Morgan Stanley worked for months to prepare what would have been the biggest ever stock market debut. But the plan to sell 5 percent of the company for a targeted $100 billion was pulled.

The bankers were paid retainer fees but were expecting around $200 million would be shared among all the banks involved when the deal was done.

Now, they are pinning their hopes on other projects from a privatization program that is part of Riyadh’s economic reform plan to loosen its reliance on oil. Without the funds from the Aramco sale, the government is looking to raise money in other ways, creating new opportunities for the banks, bankers say.

Teams from JP Morgan and Morgan Stanley that worked on the IPO, have been shifted to advise on Aramco’ planned acquisition of up to $70 billion in petrochemicals firm Saudi Basic Industries (SABIC), three people familiar with the details of the transaction told Reuters.

HSBC, which was also an adviser on the Aramco IPO, is expected to play a role in putting together the debt to fund that purchase, they said.

One of the sources said the issue could exceed the 2016 sovereign bond issue of $17.5 billion, which was a record for the kingdom. Aramco said earlier this month it was in “very early-stage discussions” with the kingdom’s Public Investment Fund (PIF) to acquire the stake in SABIC but has not said how it will finance the deal.

Spokespeople for JP Morgan, Morgan Stanley and HSBC declined to comment on their role in the Sabic deal. None of those banks have confirmed they were involved in the Aramco IPO. Other deals are expected to be forthcoming.

“The PIF[sovereign wealth fund] has had to reconsider its budget in the last three months, after finding out that they wouldn’t be getting $100 billion from the Aramco IPO right away,” said a banker in Saudi Arabia.

“So there’s been a flurry of activity as they look to raise cash in other ways. A lot of these are smaller deals, $1 billion here and there, but all geared toward financing their commitments for big infrastructure projects without slowing down their timelines.”

The banker did not give details of the other deals. PIF officials did not respond to a Reuters request for comment.

After Reuters reported last week that the Aramco deal had been shelved, Energy Minister Khalid al-Falih said the government was committed to conducting the IPO at an unspecified date in the future.

Bankers wary

The bankers are nevertheless wary after the Aramco experience. It highlighted the hurdles of doing business in a country governed by an absolute monarchy where public protest and political parties are banned. It also added to uncertainty after scores of top royals, ministers and businessmen were rounded up in an anti-corruption campaign last November.

The preparation for the listing was launched by Crown Prince Mohammed bin Salman two years ago and some bankers had flown to the kingdom hundreds of times to work in the Dhahran camp, a gated compound for the oil group’s residents.

A different source said Aramco had demanded it deal only with the very top bankers.

Another person familiar with the Aramco deal said he had made more than 20 trips to Dhahran over 18 months but with little to show for it. He said his team would “give the same presentation each time without getting much feedback.”

Bankers also say the fees are modest in comparison to those paid by other countries.

“The deal flow is huge but there’s a worry that the fees coming from these projects are low,” said a Gulf-based banker who spoke on conditions of anonymity.

“Saudi Arabia is lower than Hong Kong and Dubai when it comes to fees,” he said. “It’s all substandard.”

Typical fees for banks doing IPOs in more developed markets are around 1 percent of the overall deal while estimates from bankers and analysts for an Aramco IPO was 0.2 percent.

The 35 banks who worked on Chinese internet giant Alibaba’s $21.8 billion float, led by six main underwriters, pocketed an estimated $300 million among them, according to Thomson Reuters data.

‘Plenty of deals’

Still, the rewards from a privatization that analysts expect to generate ($9 billion to $11 billion) by 2020 are too big for bankers to ignore.

HSBC is already advising Saudi International Petrochemical Company on a potential merger with Sahara Petrochemical, which is being advised by Morgan Stanley, according to disclosures from March.

U.S. bank Citigroup obtained a license to conduct capital markets business in Saudi Arabia last year after an absence of almost 13 years.

Moelis is preparing to apply for an advisory license in Saudi Arabia and U.S. boutique investment bank Evercore opened an office in Dubai in 2017.

The government is also trying to make it easier to do deals, changing the law to allow alternatives to traditional debt finance.

“There are plenty of deals to be made from bigger players looking to consolidate their market position and buy out competitors,” said Mohammed Fahmi, the Dubai-based co-Head of EFG Hermes Investment Banking.

“Good stories will continue to see a following.”
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The film industry organization that presents the Academy Awards is also developing young talent through a program called Academy Gold — an internship and mentoring program for students and young professionals from communities currently underrepresented in Hollywood. Some of the participants are either immigrants or children of immigrants who are trying to create an unorthodox career path for themselves. VOA’s Elizabeth Lee reports from Los Angeles.
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