Are Immigrants Driving the Motor City?

Beside rows of rusting shipping containers, a decorative wrought iron fence surrounds Taquería Mi Pueblo, one of the first family-run Mexican restaurants in southwest Detroit, Michigan.

Its owner, Jalisco-native José de Jesús López, surveys the trees he planted and his ornamental roosters.

“Everything was abandoned, a dump over there,” he said, walking down Dix Street. When he first arrived as an undocumented immigrant in 1981, López recalls a drug-addict-infested lot and overrun lawn.

“Mexicantown,” as the area is affectionately and marketably called today, is one of Metro Detroit’s most vibrant dining scenes for locals and tourists — and a model for other immigrant neighborhoods.

Landing destination

Like López, many foreigners stumbled upon Detroit, viewing the city as an economically viable “second landing destination” — friendly to immigrants, but with cheaper housing and commercial space than traditional immigrant hubs like New York and San Francisco.

Through the 2008 recession and recovery, native-born residents fled. But immigrants kept coming, starting new businesses, hiring local residents and making their neighborhoods a safer place for children.

A June study by Global Detroit and New American Economy reveals that the city’s immigrant population grew by 12.1 percent between 2010 and 2014, at a time when the city’s overall population declined by 4.2 percent. Though the four-year increase in immigrants amounts to merely 4,137 individuals, the study claims the effects have been widely felt.

Watch: Beleaguered Detroit Relying on Immigrants to Revitalize City

“Immigrants are leading in the city’s recovery,” said Steve Tobocman, director of Global Detroit, “particularly in its neighborhoods like Mexicantown, in Banglatown, where new residents are moving in and helping to stabilize working-class communities by fixing up homes, opening up businesses, and creating more consumers.”

Depopulation, Tobocman adds, remains Detroit’s biggest challenge moving forward, while immigrants are “our best hope to rebuilding,” especially on the neighborhood level.

No ‘magic bullet’

According to Americas Society/Council of the Americas (AS/COA) and Fiscal Policy Institute, more than one-third of Detroit-area “Main Street” business owners were immigrants as of 2013.

But data measuring their economic contributions can be misleading, says Stanley Renshon, CUNY professor of political science.

“Any economic activity is grabbed by economists as positive,” Renshon told VOA. “Yes, you increase the overall financial numbers of the country, but the people who benefit most from that are the immigrants themselves, and that’s fine. We want them to prosper, but don’t tell me that what you’re doing is saving the country or the city or the town.”

Detroit’s ongoing struggles, including a long history of political corruption and one of the highest murder rates in the country, can’t be solved by new immigrants, he added.

Hurting American workers?

Last week, White House senior adviser for policy Stephen Miller announced the administration’s support for an immigration bill that would cut legal immigration by half.

Their premise that less-skilled immigrants take away work opportunities from native-born Americans is an “America first” message intended to resonate with President Donald Trump’s base in depressed rust belt towns like Detroit.

“How is it fair, or right or proper that if, say, you open up a new business in Detroit, that the unemployed workers of Detroit are going to have to compete against an endless flow of unskilled workers for the exact same jobs?” asked Miller during a White House press briefing Aug. 2.

Global Detroit’s Tobocman says Trump’s proposed policies won’t produce any new jobs and may cost the Michigan economy hundreds of millions of dollars.

“[Trump’s actions would choke] off a critical supply of talent, of investment, and of global connections that are critical to the future of Michigan, to us being a mobility capital for the world,” Tobocman said.

Detroit suffered an unemployment rate of 28.4 percent during the great recession, but had rebounded to 7.8 percent in June.

Banglatown

Following the likes of Mexicantown, Metro Detroit’s second-most populous foreign-born community, from Bangladesh, hopes to follow suit and create a cultural tourist destination of its own: Banglatown.

“You will hardly find any vacant spot right now,” said Ehsan Taqbeem, founder of Bangladeshi-American Public Affairs Committee (BAPAC), driving his Jeep Grand Cherokee past South Asian restaurants, fabric and fish shops in Detroit and neighboring Hamtramck.

“The value of the homes have gone up since [the recession], businesses have been thriving, and traffic has gone up tremendously,” he said.

Unlike Mexicantown, Banglatown is a concept still in its early stages. There are no traditional rickshaws carrying tourists down Conant Avenue — at least not yet.

But Taqbeem, who runs an automotive retrofitting service, along with other local business owners, sees the benefit of being a branded community in a global-minded city.

Mahabub Chowdhury, part-owner of Aladdin Sweets & Cafe, found success in nourishing his neighborhood and patrons, a majority of whom are non-Bangladeshis. One regular customer, whom he describes as a nice “American white person,” calls him directly.

“Sometimes his car is broken, and he calls us, ‘Can you pick me up from my house?’ And we go to his house and bring him to our restaurant,” Chowdhury said.

‘​Believing in Detroit’

In Mexicantown, Lopez’s eyes well as he recalls his early days on a Jalisco ranch, before finding eventual success in Detroit.

“My main dream was to be able to buy a truck for my dad,” Lopez said. “I worked all my life, and when I had the money, I didn’t have my father anymore.”

Now an American citizen, López, a father of four, says he accomplished the American Dream by creating something that will outlive him and provide for the community long after he has passed.

What Detroit still needs, he said, is more people to call it home. 

“That’s happening little by little,” Lopez said. “The greatest changes won’t happen overnight.”

“They happen slowly, and that’s part of believing in oneself, believing in Detroit,” he said.

 

Beleaguered Detroit Relying on Immigrants to Revitalize City

Detroit, Michigan, knows hardship and recovery. One of the hardest hit areas in the country during the Great Recession, the Midwestern Rust Belt city has since found an ingredient to its economic revitalization through empowerment of its immigrant communities. But not everyone is convinced that the solution is viable or helps anyone beyond the immigrants themselves. Ramon Taylor has more.

Turkmen Capital Targets Street Kids Ahead of International Games

Child beggars have long been part of the social fabric in Ashgabat, where some families acknowledge that they depend on such income for survival.

However, Ashgabat police have begun clearing the streets of those children as the Turkmen capital gears up for the Asian Indoor And Martial Arts Games (AIMAG) in September, according to residents and parents interviewed by RFE/RL.

Police officers, raiding the city in vans, order such children home and warn them not to return to the streets, said Ashgabat resident Amanmyrat Bugaev. 

An Ashgabat police officer within the juvenile-affairs department, who requested anonymity because he was not authorized to speak publicly, described the process as rounding up repeat offenders, taking them home in police vans, and warning the parents that forcing children to beg is a criminal offense.

The officer said that in some cases the department summons the parents and issues official warnings.

He acknowledged that the “main” goal was to preserve the country’s “image,” although he said the measures were also aimed at safeguarding children.

Only source of income

“A disabled person in a wheelchair begging for money damages the image of any country,” the officer said. “The main goal is to fight something that might damage the [national] reputation.”

Some parents who acknowledge benefiting from alms collected by their children complained that the government’s effort deprives their families of their only source of income.

Turkmenistan is a mostly rural, post-Soviet country whose jobs and economy are heavily dependent on the state. The wealth from its sizable natural-gas and other exports, including cotton, has largely failed to trickle down to its 5 million or so people.

RFE/RL’s Turkmen Service spoke with four parents — all Ashgabat residents — who said the money their children made on the streets helped the family survive.

“Apart from my disabled son, there are three other small children in our family,” said one unemployed woman whose disabled child spends hours in the streets every day seeking handouts from strangers. She said the family also “depends on the monthly social allowance he gets from the government.”

“We would work, but there are no jobs, so we send our children to the streets, hoping for kind people’s donations,” said the woman, who didn’t want to give her name.

Widespread unemployment

None of the parents would say how much their children made in a day on Ashgabat’s streets.

Unemployment is widespread in Turkmenistan, although the government doesn’t release official figures. Regional media have put the jobless rate in the country at around 50 to 60 percent. 

Turkmenistan wants to use the Asian Indoor and Martial Arts Games, the brainchild of President Gurbanguly Berdymukhammedov, to boost its image as a regional sports hub. The isolated nation expects tens of thousands of foreigners to visit during the September 17-27 event. 

In the months leading up to the games, authorities have restricted the movement of provinces’ residents to the capital, ordered former inmates to stay away from the games’ venues, and tried to clear the city of stray dogs and cats.

Farangis Najibullah wrote this article, based on a report by RFE/RL’s Turkmen service.

Relatives Of Kursk Submarine Sailors Mark 17th Anniversary Of Disaster

Residents of St. Petersburg on Saturday paid homage to sailors from the Kursk nuclear submarine, which sank in the Barents Sea exactly 17 years earlier.

Relatives and friends of crew members gathered for a memorial service and a commemorative meeting at St. Petersburg’s Serafimovskoye Cemetery.

All 118 crew members aboard the nuclear-powered Kursk submarine died on August 12, 2000, after an explosion occurred as the crew was preparing to fire a practice torpedo.

The Russian Navy’s final official report concluded that the explosion was caused by the failure of a torpedo.

The Kursk was raised from the bottom of the Barents Sea in 2001.

Reporting includes information from TASS and Interfax.

MSF Suspends Mediterranean Rescues as Migrant Dispute Mounts

Doctors Without Borders (MSF) said on Saturday it was suspending its migrant rescues in the Mediterranean because it felt threatened by the Libyan coastguard and the Italian government’s policies have made its job harder.

The aid group’s decision is the latest development in mounting tensions between Rome and NGOs as migration dominates Italy’s political agenda ahead of elections early next year.

“We are suspending our activities because now we feel that the threatening behaviour by the Libyan coastguard is very serious … we cannot put our colleagues in danger,” the president of MSF’s Italian arm Loris De Filippi told Reuters.

Almost 600,000 migrants have arrived in Italy over the past four years, the vast majority setting sail from lawless Libya in flimsy vessels operated by people smugglers. More than 13,000 migrants have died trying to make the crossing.

Charity boats have played a growing role in rescues, picking up more than a third of all migrants brought ashore so far this year against less than one percent in 2014.

However, Italy fears the groups are facilitating people smuggling and encouraging migrants to make the passage, and it has proposed a Code of Conduct governing how they operate.

Some groups, including MSF, have refused to sign the code.

They object to a requirement that Italian police officers be on their boats and that the boats must take migrants to a safe port themselves, rather than transferring them to other vessels to allow smaller boats to stay in the area for further rescues.

MSF operates one rescue ship in the Mediterranean, the Prudence, currently docked in the Sicilian port of Catania.

In the last six weeks the number of migrant arrivals in Italy has slowed sharply and Rome has begun collaborating more closely with the Libyan coastguard, which De Filippi said was threatening the NGOs and preventing them from working.

He said the Libyan coastguard had demanded the NGOs should leave an area of up to hundreds of kilometres around its coast, whereas previously they had been allowed to conduct search and rescue operations as close as 11 nautical miles to the mainland.

“Last year the coastguard fired 13 shots on our boat and that was in a situation that was much calmer than the present one,” said De Filippi.

He said MSF would continue its collaboration with another aid group, SOS Mediterranee, which operates a rescue ship in the Mediterranean with MSF doctors on board.

De Filippi said the Rome government’s Code of Conduct for NGOs and its support for the Libyan coastguard showed it was now mixing the humanitarian goal of saving lives with “a political and military intention” of reducing arrivals.

“We refuse to be co-opted into a system that blocks people from seeking safety and protection,” MSF tweeted, adding that the European Union’s immigration policies showed it was “determined to trap people in Libya.”

Oscar Camps, the founder of Proactiva Open Arms, another aid group active in the Mediterranean, also took aim at the EU, tweeting: “the first NGO out, this is just what the EU wants.”

An Italian government spokesman was not immediately available to comment, while Matteo Salvini, leader of the anti-immigrant Northern League, said MSF’s move meant there would be “thousands fewer illegal immigrants for Italians to maintain.”

Last week Italy began a naval mission in Libyan waters to train and support its coastguard, despite opposition from factions in eastern Libya that oppose the U.N.-backed government based in Tripoli.

General Khalifa Haftar, a commander aligned with an Eastern-based parliament, told Italian daily Corriere della Sera on Saturday the presence of Italian military vessels in Libyan waters was unacceptable but he would not attack them.

Electric Car Worry: Where Can You Charge It?

Around the world, support is growing for electric cars. Automakers are delivering more electric models with longer range and lower prices, such as the Chevrolet Bolt and the Tesla Model 3. China has set aggressive targets for electric vehicle sales to curb pollution; some European countries aim to be all-electric by 2040 or sooner.

Those lofty ambitions face numerous challenges, including one practical consideration for consumers: If they buy electric cars, where will they charge them?

The distribution of public charging stations is wildly uneven around the globe. Places with lots of support from governments or utilities, like China, the Netherlands and California, have thousands of public charging outlets. Buyers of Tesla’s luxury models have access to a company-funded Supercharger network. 

Charging stations scarce

But in many places, public charging remains scarce. That’s a problem for people who need to drive further than the 200 miles or so that most electric cars can travel. It’s also a barrier for the millions of people who don’t have a garage to plug in their cars overnight.

“Do we have what we need? The answer at the moment is, ‘No,’” said Graham Evans, an analyst with IHS Markit.

Take Norway, which has publicly funded charging and generous incentives for electric car buyers. Architect Nils Henningstad drives past 20 to 30 charging stations each day on his 22-mile (35-kilometer) commute to Oslo. He works for the city and can charge his Nissan Leaf at work; his fiancee charges her Tesla SUV at home or at one of the world’s largest Tesla Supercharger stations, 20 miles away.

It’s a very different landscape in New Berlin, Wisconsin, where Jeff Solie relies on the charging system he rigged up in his garage to charge two Tesla sedans and a Volt. Solie and his wife don’t have chargers at their offices, and the nearest Tesla Superchargers are 45 miles (72 kilometers) away.

“If I can’t charge at home, there’s no way for me to have electric cars as my primary source of transportation,” said Solie, who works for the media company E.W. Scripps.

Small percentage of electric vehicles

The uneven distribution of chargers worries many potential electric vehicle owners. It’s one reason electric vehicles make up less than 1 percent of cars on the road.

“Humans worst-case their purchases of automobiles. You have to prove to the consumer that they can drive across the country, even though they probably won’t,” said Pasquale Romano, the CEO of ChargePoint, one of the largest charging station providers in North America and Europe.

Romano says there’s no exact ratio of the number of chargers needed per car. But he says workplaces should have one charger for every 2.5 electric cars and retail stores need one for every 20 electric cars. Highways need one every 50 to 75 miles, he says. That suggests a lot of gaps still need to be filled.

Filling the charging gap

Automakers and governments are pushing to fill them. The number of publicly available, global charging spots grew 72 percent to more than 322,000 last year, the International Energy Agency said. Navigant Research expects that to grow to more than 2.2 million by 2026; more than one-third of those will be in China.

Tesla Inc., which figured out years ago that people wouldn’t buy its cars without roadside charging, is doubling its global network of Supercharger stations to 10,000 this year. BMW, Daimler, Volkswagen and Ford are building 400 fast-charging stations in Europe. Volkswagen is building hundreds of stations across the U.S. as part of its settlement for selling polluting diesel engines. Even oil-rich Dubai, which just got its first Tesla showroom, has more than 50 locations to charge electric cars.

But there are pitfalls. There are different types of charging stations, and no one knows the exact mix drivers will eventually need. A grocery store might spend $5,000 for an AC charge point, which provides a car with 5 to 15 miles of range in 30 minutes. But once most cars get 200 or 300 miles per charge, slow chargers are less necessary. Electric cars with longer range need fast-charging DC chargers along highways, but DC chargers cost $35,000 or more.

That uncertainty makes it difficult to make money setting up chargers, says Lisa Jerram, an associate director with Navigant Research. For at least the next three to five years, she says, deep-pocketed automakers, governments and utilities will be primarily responsible for building charging infrastructure.

There’s also the question of who will meet the needs of apartment dwellers. San Francisco, Shanghai and Vancouver, Canada, are now requiring new homes and apartment buildings to be wired for EV charging.

But without government support, plans for charging stations can falter. In Michigan, a utility’s $15 million plan to install 800 public charging stations was scrapped in April after state officials and ChargePoint objected.

Solie, the electric car owner in Wisconsin, likes Europe’s approach: Governments should set bold targets for electric car sales and let the private sector meet the need.

“If the U.S. were to send up a flare that policy was going to change … investments would become very attractive,” he said. 

Report: Trump to Announce China Trade Practices Investigation

U.S. President Donald Trump will call Monday for his chief trade adviser to investigate China’s intellectual property practices, the website Politico reported, citing an unnamed administration official.

Trump had been expected to order a so-called Section 301 investigation under the 1974 Trade Act earlier this month, but action had been postponed as the White House pressed for China’s cooperation in reining in North Korea’s nuclear program.

Politico said it was not clear how much detail Trump would provide in his announcement, but that administration officials expected U.S. Trade Representative Robert Lighthizer to open a Section 301 probe.

Officials at the White House and U.S. Trade Representative’s office were not immediately available for comment.

Trump has suggested he would go easier on China if it were more forceful in getting North Korea to rein in its nuclear weapons program.

While China joined in a unanimous U.N. Security Council decision to tighten economic sanctions on Pyongyang over its long-range missile tests, it is not clear whether Trump thinks Beijing is doing enough.

“We lose hundreds of billions of dollars a year on trade with China. They know how I feel,” he told reporters Thursday. “If China helps us, I feel a lot different toward trade.”

Trump will make a day trip to Washington, D.C., on Monday, briefly interrupting his 17-day August working vacation, a White House official said Friday.

Politico said the investigation would not mean immediate sanctions, but would ultimately lead to steep tariffs on Chinese goods.

 

US Stocks Post Gains Friday After Several Down Days

U.S. stock market indexes posted gains in Friday’s trading, a change in direction after several down days amid tensions between President Donald Trump and North Korea.

In New York, the Standard & Poor’s 500 index and the Dow Jones industrial average each advanced about one-tenth of a percentage point, while the Nasdaq composite index rose almost eight-tenths of a percentage point. Earlier, stocks in Paris and London were off 1 percent, while Hong Kong stocks fell 2 percent and Korean shares slid nearly as much.

Global stock prices had been falling for several days, losing nearly $1 trillion in value during angry exchanges between the U.S. and North Korea, which continued Friday.

Investors have reason for concern, according to Rajiv Biswas, Asia-Pacific chief economist of IHS Markit. He said the economic consequences of even a conventional conflict would most likely be “horrific” and “devastate” the South Korean economy, hurting that nation’s trading partners, particularly Japan.  

In an email exchange with VOA, Biswas called the possibility that North Korea could actually use nuclear weapons a “nightmare but still low probability scenario” and noted there had been prior incidents of rising tensions on the peninsula.  

A similar view came from Brad McMillan, chief investment officer for Commonwealth Financial Network, who wrote, “All parties, including the North Koreans, have substantial incentives to once again cut a deal rather than fight. Based on past crises, there will be a great deal of theater, only to end in some kind of deal.”

He wrote that military action was “unlikely” in the short term, suggesting “worry is overdone at the moment.” But he wrote that military action “is actually very possible in the medium term.”  

McMillan wrote that such a conflict could have “dramatic and substantial” impact on many economies because South Korea “is a major trading and manufacturing hub.” That means “disruption there would break supply chains around the world” and might last “for months or years.”  

He wrote that rising uncertainty would prompt money to move out of stocks and into less risky investments, which would drive down stock market prices: “Clearly, there are real reasons to try to avoid a war.”

US Calls for Confidence-building Measures in Nagorno-Karabakh

Sixteen months after deadly clashes erupted in Azerbaijan’s autonomous breakaway region of Nagorno-Karabakh, international mediators are saying it’s time for all parties to undertake confidence-building measures to jump-start the political settlement process.

Russia led mediation to settle the four days of shelling and rocket strikes between Azerbaijan’s military and Armenian-backed separatists over Nagorno-Karabakh. The clashes were the deadliest incidents since a 1994 cease-fire established the current territorial division. The brief but intense fighting of April 2016 claimed dozens of lives.

Since then, the United States, Russia and France, which co-chair the Organization for Security and Cooperation in Europe’s Minsk Group for conflict mediation, have continued advocating diplomacy to secure a binding peace resolution.

Steps toward demilitarization are essential to deterring accidental flare-ups of violence between the groups, said Ambassador Richard Hoagland, U.S. co-chairman of the Minsk Group.

“When you have two armed groups facing each other in difficult terrain not very far apart, there is always the chance for some kind of accident to happen that then spirals out of control,” he recently told VOA’s Armenian and Azeri services. “I know that at this point it will be difficult to ask for total demilitarization, although that would be good, so what we have to do is to look for those things that can help to reduce the possibility of some kind of military accident that then gets out of control.”

Removal of snipers along both sides of the Karabakh line of contact, which separates Nagorno-Karabakh and Azerbaijan, would be a logical first step, Hoagland said.

Allowing the presence of international observers and installing new electronic equipment that traces cease-fire violations, he said, would be a second realistic benchmark to achieve.

“There is an actual document [that maps out the peace process], and it’s a very comprehensive, but there are steps and steps and steps, and stages and stages,” he told VOA. “So I would hope that in the next highest level of negotiations, the two sides will look very seriously and say even if they can’t come to a final conclusion, here are things we can accomplish.”

U.S.-Russian coordination?

Although some observers describe the Nagorno-Karabakh conflict as a rare point of shared strategic interests between the U.S. and Russia, others are skeptical.

Hoagland, however, struck an optimistic tone, saying the United States was continuing to work with Russia on this issue despite deteriorating relations between the two countries.

“I have seen absolutely no change in how we work together and how we regard each other,” he told VOA. “Just because sometimes the politicians are bumping up against each other, for us, the work continues and we do it arm in arm.

“Maybe at the top the headline news doesn’t look good, but when you get down to specific issues, specific problems to work on together, where we do cooperate, that continues and it continues today on Nagorno-Karabakh,” he added.

Although the conflict has yet to come under the focus of the President Donald Trump’s administration, former Ambassador John Herbst, director of the Atlantic Council’s Dinu Patriciu Eurasia Center, told VOA that might change in the coming six to 12 months.

While a planned U.N. General Assembly meeting between Armenian President Serzh Sargsyan and Azerbaijani President Ilham Aliyev may signal a loosening of tensions between the groups, Herbst said, “I still do not see any grounds for a reasonable settlement of the conflict.”

“Everyone knows that the overwhelming majority of the population of Karabakh are Armenians and they will have substantial autonomy, and this should be the basis of the settlement,” he said.  

Competing interests

The main obstacle to full settlement of the Nagorno-Karabakh conflict is the fact that there are too many interests involved in the problem, said analyst Michael Rubin of the American Enterprise Institute, a public policy research group.

“If the problem was only about the two countries, it would probably have been settled, but states like Russia want to maintain the conflict,” he said.

Echoing that sentiment, Anna Borshchevskaya of the Washington Institute for Near East Policy said Armenian officials have complained that a Nagorno-Karabakh settlement has been hampered by Russian arms sales to both sides.

“Russia wants to play a serious role in this conflict, and if there is no conflict, there will be no such role,” she said.

Although Russian weapons deliveries to Baku remained a contentious issue throughout Armenia’s 2017 parliamentary elections, most political forces steered clear of the topic and the question of whether Armenia is more secure with Russia as an ally.

Russia plays an important role in the region as its former imperial and Soviet-era overlord. It is also the main seller of weapons to both Armenia, a close Moscow ally, and Azerbaijan, which has developed warm relations with ethnically kin Turkey.

The Kremlin has consistently stated that it intends to continue selling arms to both camps while supporting peaceful resolution of the conflict.

On July 17, Armenia’s president called Russian arms sales to Baku “the most painful side of Armenian-Russian relations.”

Baku

Armenian political scientist Suren Sargsyan said Baku officials need to assume a more proactive role in securing the front lines, touching on Hoagland’s calls for demilitarization as an example.

“Such an agreement has been reached between the parties,” she told VOA. “But the Azerbaijani side has not taken any practical steps in that direction for a long time. That is why the negotiation process goes to a deadlock.”

Fighting between ethnic Azeris and Armenians erupted in 1991 and a cease-fire was agreed to in 1994. But Azerbaijan and Armenia regularly accuse each other of carrying out attacks around Nagorno-Karabakh and along the Azeri-Armenian border.

On July 5, an Azeri woman and child were killed and another civilian wounded by Armenian forces near the boundary with Nagorno-Karabakh, Azerbaijan’s defense ministry said Wednesday.

Sporadic exchanges of fire in the fight for control over the region — inside Azerbaijan but controlled by ethnic Armenians — have stoked fears of a wider conflict breaking out in the South Caucasus, which is crossed by oil and gas pipelines.

This story originated in VOA’s Armenian service. Some information came from Reuters.

Interview: How North Korea Tensions Impact Stock Markets

Rising tensions between the United States and North Korea brought a wave of falling stock prices recently as worried investors moved money out of equities and into the perceived safety of gold, Swiss currency and similar products. At one point, this change of investment strategy cut $1 trillion from the value of global stock markets.

For some perspective on these concerns, VOA’s Jim Randle spoke with IHS Markit’s Rajiv Biswas in Singapore. IHS Markit employs thousands of financial, data, and other experts who track economic issues worldwide. Biswas is the company’s chief economist for APEC. His comments here were edited for brevity and clarity.

Randle: Why do rising nuclear tensions prompt falling stock prices?

Biswas: In the nightmare, but still low-probability scenario in which North Korea were to succeed in using nuclear weapons against South Korea, the devastation of the Korean peninsula would be catastrophic. Global financial markets would also suffer a tremendous shock in the short term, with massive flight to safe haven assets such as gold, USD and CHF. The humanitarian crisis and economic reconstruction of the Korean peninsula after such a nuclear conflict would require large-scale international cooperation led by China, the U.S. and EU, and would likely take over a decade to rebuild the economy.

Even a conventional war would result in considerable destruction to the South Korean economy… and likely result in tremendous casualties in both South and North Korea. The economic consequences … would likely be horrific, and … also result in a temporary shock to global financial markets. The greatest vulnerability would be for the South Korean financial markets and Korean won. Other regional East Asian financial markets would also be vulnerable, particularly Japanese financial markets, with risks of disruption to Northeast Asian regional trade and investment flows and manufacturing supply chains.

The South Korean economy accounts for around 1.9% of world GDP, and a severe drop in South Korean GDP … would have negative effects on key trade partners. Japan is also concerned that North Korea could launch missiles at Japanese targets, particularly… U.S. military bases in Japan. The reconstruction and rebuilding of South Korea’s economy after a major conflict would likely take many years, with significant international support needed to help South Korea with the reconstruction task.

Randle: Why do worried investors seek gold, oil, and Swiss currency?

Biswas: If international investors fear that the probability of a military conflict on the Korean peninsula is rising, they will likely reduce their exposure to global growth assets, such as Asian equities and Asian currencies…  as they fear that the world economy and Asian countries near North Korea could suffer economic dislocation and trade disruption in the event of a conflict.

In times of geopolitical crisis, the traditional safe haven assets for global investors are gold, U.S. dollars, U.S. Treasuries and Swiss francs, as these are very stable, internationally traded liquid assets. These safe haven assets tend to rise in value when investors fear that geopolitical crises could weaken global growth prospects as investors switch their investments out of global equities and emerging market currencies into the safe haven assets.

Randle: Are U.S. stocks ripe for a fall? 

Biswas: While geopolitical risks due to escalating tensions on the Korean peninsula have been reflected in some modest declines in some international equity markets in recent days, there has been many previous episodes of rising military tensions on the Korean peninsula. Global investors have previously shown considerable resilience to earlier bouts of geopolitical tensions on the Korean peninsula, such as North Korea’s sinking of the South Korean navy warship Cheonan and the North Korean artillery shelling of South Korea’s Yeonpyeong Island in 2010

During 2017 to date, the U.S. equity market has been driven by a wide range of positive factors, including sustained U.S. economic growth momentum, planned corporate tax cuts by the Trump administration, moderate inflation pressures and positive U.S. corporate earnings growth prospects, so geopolitical risks from North Korea are not the only factor impacting on the U.S. equity market outlook.

Randle: Even if actual hostilities don’t break out, could these nuke worries be enough, in theory, to spark a sharp drop in financial markets? 

Biswas: “The canary in the coal mine that will signal rising international financial markets’ risk aversion [worry] is likely to be South Korean asset classes. The South Korean stock market and the Korean won are likely to be most vulnerable to declines in response to rising international investor concerns that military tensions are escalating further. One measure of financial risk are the South Korean sovereign credit default swap (CDS) spreads, with IHS Markit data indicating that South Korean CDS spreads widened in July following North Korea’s ICBM tests, and spiked up further this week following North Korea’s threat to attack Guam. So far, these widening spreads only signal a moderate increase in financial markets perceptions of geopolitical risks on the Korean peninsula, but a sharp further widening of the South Korean sovereign CDS spread would be a clear signal of rising investor anxiety.”

Slovenia to Hold Presidential Election in October

The next presidential election in Slovenia will be held on October 22 and the incumbent is expected to run for a second term.

 

Parliamentary speaker Milan Brglez on Friday formally set the date for the vote which must be held in the autumn. Recent opinion polls predict that President Borut Pahor will likely be re-elected if he chooses to run.

 

The 53-year-old Pahor is a former fashion model who has become known for his use of social media while in office.

 

The Alpine nation of 2 million people is the homeland of U.S. first lady Melania Trump.

Aid Agencies Warn Displaced Against Premature Returns to Syria

The International Organization for Migration (IOM) is warning people against returning prematurely to war-torn Syria as the number of displaced going back to their homes reaches a record high.

An IOM report found more than 600,000 displaced Syrians have returned home in the first seven months of this year, nearly as many as the total number of returnees for all of 2016.

IOM spokeswoman Olivia Haedon said most of the returns are spontaneous, but not necessarily voluntary, safe or sustainable.

“As the security situation changes in different parts of the country, displacement can occur again,” she said. “As you noted, in the number of people who were displaced this year, which is over 800,000, some people are being displaced for the second or third time.”

The report said most of the people returning to their homes, 84 percent, are internally displaced, while 16 percent are returning refugees from Turkey, Lebanon, Jordan and Iraq. It said an estimated two-thirds have returned to Aleppo Governorate. Others have gone mainly to Idleb, Hama, Raqqa, and Rural Damascus Governorates.

Haedon said people cite a variety of reasons for their decision to go home.

“They are going back with the hope that they can stay to protect their property and engage in a better, improved economic situation, or, protect themselves if they are leaving because of the area that they were living was less secure than the place that they originated from,” she said. “So, we do see that the people are hoping that they can stay for a longer term.”

Haedon said humanitarian organizations agree organized returns to Syria are not yet an option. Syria is not safe, she added, and the places to which people return are not equipped to provide essential services.

She said the IOM is not encouraging Syrians to go home.

Israel, Land of Milk and Honey – and Now Whiskey?

Israel has been known as the land of milk and honey since Biblical times – but the land of single malt whiskey? One appropriately named distillery is trying to turn Israel into a whiskey powerhouse.

Smooth, honey-brown whiskey is not the first thing that comes to mind when most people think of Israel. However, at the Milk and Honey Distillery, rows of casks proudly stamped “Tel Aviv” hold liters of the stuff.

The country’s first whiskey distillery is preparing to release Israel’s first single malt whiskey.

 

“It’s a young whiskey,” said Eitan Attir, the distillery’s CEO.

 

Attir says the brew is aged for three years and two months in virgin oak and old bourbon barrels at the company’s renovated former bakery in a rugged industrial area of south Tel Aviv.

 

“It’s complex for its age,” he said. “The taste feels like more than three years, more like seven or eight and again the story is much more important in this case. This is the first ever single malt whiskey that any distillery has released from Israel.”

 

Although wine has been produced in the Holy Land for millennia, and modern Israeli wines have gained international renown in recent years, whiskey production is new to the country.

 

Milk and Honey was founded in 2013 and began distilling small experimental batches of whiskey a year later. One hundred bottles from their first cask of Single Malt are set to be sold at an online auction starting August 11.

 

Whiskey is universally acceptable for religious Jews to consume, Attir says, and Milk and Honey’s drink is “ultra-kosher.”

 

“We don’t work on Saturday, we don’t work on Yom Kippur or Passover,” he said. “And we want to symbolize our being Jewish or Israeli and then we called it the Milk and Honey Distillery.”  

 

Warmer climate more amenable

The single malt was made in Israel from start to finish, according to the company’s website, though the ingredients, barrels and equipment were imported from the U.S., U.K. and elsewhere. The warmer climate in Israel allows for a speedier aging process in the barrel than whiskey made in colder climates, according to Ran Latovicz, an Israeli whiskey connoisseur and bar owner.  

 

“In colder climates like Scotland or Ireland, whiskey usually ages for about seven to 10 to 12 years before it’s even bottled because [it is] just the way, you know, it gets to its full potential,” he said.

 

The distillery believes it is well positioned to ride a wave of growing international interest in new world whiskeys, like rising stars from Taiwan or India, and hopes this initial offering whets the appetites of aficionados everywhere.

“There’s a huge demand nowadays for whiskey from other places around the world – new world whiskey. There’s more than 70 countries now with a minimum of one distillery and one of them is Israel,” Attir said.

 

Gal Kalkshtein, Milk and Honey’s founder and owner, said he hopes that once the whiskey starts getting shipped abroad in 2019, it will create a buzz for Israeli whiskies.

 

“We want to be recognized for our quality, not the gimmick,” he said.

EU Calls a Meeting of Ministers Over Egg Contamination

The European Commissioner in charge of food safety called Friday for an emergency meeting of ministers to discuss eggs contamination, appealing for an end to finger-pointing among member states over the scandal.

“Blaming and shaming will bring us nowhere and I want to stop this,” EU Health Commissioner Vytenis Andriukaitis from Lithuania said.

Andriukaitis said he hoped to convene a meeting before the end of September of the ministers and representatives of various national food safety agencies.

Millions of eggs recalled

Millions of eggs and egg-based products have been pulled from European supermarket shelves in at least 11 countries, since the scandal went public Aug. 1. So far, no one has reported falling sick from the tainted eggs.

Some national regulators have voiced concern that eggs contaminated with the insecticide Fipronil, which can harm the kidneys, liver and thyroid glands, have entered the food chain, mainly through processed products such as biscuits and cakes.

Meanwhile, police in the Netherlands arrested two people Thursday for allegedly using a banned pesticide as the investigation of contaminated eggs continues.

Belgian and Dutch authorities conducted raids at a number of poultry farms Thursday, but authorities did not provide details about which companies were targeted.

Eggs found across Europe

British food safety authorities believe around 700,000 contaminated eggs have been imported into the country, and the Food Standards Agency has issued a list of products in which the eggs could be found.

Danish authorities said 20 tons of contaminated eggs had been sold in Denmark, but cautioned that the eggs posed no risk to humans.

Smaller numbers of eggs were reported in Luxembourg and Slovakia, but authorities in those countries either destroyed the products containing the eggs or sent them back to their producers.

Authorities in Sweden, Switzerland, Romania and France also reported having found contaminated eggs.

With the contaminated eggs starting to surface in countries across Europe, Dutch and Belgian officials are facing growing questions about how the scandal started and whether the public has been kept fully aware.

U.S. Considering Lethal Defensive Arms to Ukraine

U.S. President Donald Trump’s administration is considering arming Ukraine with lethal defensive weapons that Kyiv could use against Russia-backed separatists. Opponents argue arming Ukraine risks escalating the conflict while supporters say better weapons would act as a deterrence to Russian aggression and give a psychological and political boost to Kyiv. The debate comes as Trump’s new envoy on Ukraine, Kurt Volker, is to visit Russia soon. VOA’s Daniel Schearf reports from Washington.

Experts Debate Pros and Cons of Lethal Arms for Ukraine

U.S. military experts are lining up on either side of a debate on whether to supply lethal defensive weapons to Ukraine, a move that would mark a turning point in U.S. policy on Kyiv’s 3-year-old conflict with Russian-backed separatists.

Supporters of the move, which is under active consideration by President Donald Trump’s administration, argue that it is long overdue. The current policy of supplying only non-lethal military gear has neither deterred Russian aggression nor created an opening for cooperation with Moscow to resolve the conflict, they argue.

“I don’t think Russia has given us a window for more positive cooperation on Ukraine,” said Molly McKew, an independent analyst with consulting firm Fianna Strategies. “Maybe other places. But, I certainly don’t see it.So, I think it’s time to reconsider what our strategy has been and what that means.

“And … Ukraine is not asking for foreign troops to come and stand beside them,” she told VOA’s Ukranian Service. “They’re asking for the ability to fight the war in the way that they know they need to fight.”

Other advocates argue that sending a message of strength would be timely after Russia retaliated against U.S. sanctions by expelling U.S. Embassy staff from diplomatic property in Moscow and demanding their numbers be reduced by 755 people by September 1.

But opponents of the move worry that supplying lethal weapons to Ukraine could escalate the conflict and provoke retaliation from the Kremlin, which has already denounced the possibility.

“I think it would make much more sense to re-think some of the aid and capabilities that are being given … and not plan them for a short-term fight, since major battles in the fronts are now passed,” said Michael Kofman, a researcher at CNA Corporation, a private research organization.

He said the U.S. should “think much more about the medium and long term of the Ukrainian military and the kind of Ukrainian military we would like to help them build.”

Kurt Volker, the Trump administration’s special envoy to Ukraine, rejected the argument that lethal arms sales would provoke Russia during a July 25 interview with Current Time, a Russian-language network jointly operated by Radio Free Europe/Radio Liberty and VOA.

“I hear these arguments that it’s somehow provocative to Russia or that it’s going to embolden Ukraine to attack,” he said. “These are just flat out wrong. First off, Russia is already in Ukraine, they are already heavily armed. There are more Russian tanks in there than in Western Europe combined. It is a large, large military presence. And, there’s an even larger military presence surrounding Ukraine from Russian territory.”

Analysts on both sides agree that Russia’s overwhelming military advantage over Ukraine means the supply of U.S. weapons would provide more of a political and morale boost for Kyiv than a defense one.

Nevertheless, Moscow is likely to raise the issue with Volker, a former U.S. ambassador to NATO, when it gets the chance. Russian Foreign Minister Sergei Lavrov has said the special envoy is expected to visit Russia for talks on Ukraine in the near future, although U.S. officials have yet to confirm the trip.

“It will be interesting because Mr. Volker has been in a number of capitals already including Kyiv, Paris, Berlin, London,” Lavrov said. “We would be interested to see what impression the U.S. special envoy has on the current state of affairs.”

During a trip to Ukraine last month, Volker visited front-line areas in the east where Ukrainian troops have been in a stand-off against Russia-backed separatists for the past three years.

He blamed Russian aggression for the violence, which has killed more than 10,000 people since 2014, when Russian forces seized Ukrainian military bases in Crimea, annexed the Black Sea peninsula, and began covert support for separatists in eastern Ukraine.

EEOC Finds Reasonable Cause Cargill Violated the Rights of Somali-American Muslim Workers

The U.S. Equal Employment Opportunity Commission has determined there is reasonable cause that the civil rights of Somali-American Muslims were violated when agri-business giant Cargill refused to allow them to pray at a meatpacking plant it owns in the western state of Colorado.

The finding was reached almost two years after about 150 workers walked off the job after supervisors informed them they could no longer pray during lunch breaks. Cargill, the largest private company in the U.S., then fired the workers for violating attendance protocol at the meatpacking plant in the city of Fort Morgan.

Cargill has maintained the issue was misconstrued by supervisors and employees.

“We do what is required by law and go further to provide additional religious accommodation in our U.S. locations,” Cargill said in a statement Wednesday.

The EEOC, which enforces anti-discrimination federal laws, also determined last week that the local Teamsters union did not provide fair representation to the Muslim workers.

“The findings of the EEOC against Teamsters and Cargill reaffirms our strongly held belief that the Somali workers that were terminated were done so in violation of their federally protected rights,” said Qusair Mohamedbhai, a lawyer with a Denver-based law firm that is representing the employees.

The EEOC’s decisions were also applauded by the Council on American-Islamic Relations.

Clock Ticking to Avoid US Debt Default

U.S. lawmakers will have three weeks to raise America’s $20 trillion borrowing limit and avert a potential debt default when Congress gets back to work next month — the first such deadline to occur during the Trump administration.

 

If recent history is a guide, raising the debt ceiling will be anything but drama-free, with lawmakers demanding concessions in return for votes to prevent an outcome that could throttle global finances: the U.S. government unable to pay its bills.

 

The White House is pushing for a so-called “clean” debt ceiling increase with no conditions attached, something Congress delivered dozens of times prior to the Obama administration.

 

“I respectfully urge Congress to protect the full faith and credit of the United States by acting to increase the statutory debt limit as soon as possible,” Treasury Secretary Steven Mnuchin wrote to congressional leaders earlier this year.

Call for spending cuts

On Capitol Hill, Republican fiscal hawks are demanding spending cuts.

 

“Most Republicans want to do something to lower the trajectory of the debt,” Republican Congressman Tom Cole of Oklahoma said Tuesday on MSNBC. “A clean debt ceiling hike is like having a credit card and saying, ‘I’ve reached my [credit] limit. I’m going to make the limit higher without changing my spending habits.’”

 

“The biggest conflict we’ve seen so far on this issue isn’t between the parties,” noted political analyst Molly Reynolds of the Washington-based Brookings Institution. “It’s within the Republican Party, where some rank-and-file members, especially in the House, have been pushing back against the idea of a clean [debt ceiling] increase.”

 

Democrats

Some Democrats, meanwhile, have a demand of their own: that Republicans forgo any debt-incurring tax cuts.

 

“It’s going to be very hard to raise the debt limit if their [Republicans’] intent is to increase the debt by massive tax cuts on the very wealthy,” Senate Minority Leader Chuck Schumer, a New York Democrat, said last month.

In 2011, protracted congressional wrangling over the borrowing limit led to a downgrade of America’s creditworthiness. Much as they do today, Republicans demanded fiscal reforms as a condition for hiking the debt ceiling.

 

“At a time when we’re borrowing 40 cents out of every dollar we spend, we want to make sure we take a significant step to reduce spending,” Republican Senator Lamar Alexander of Tennessee said days before the 2011 fiscal deadline.

 

Congressional Democrats responded by accusing Republicans of taking the U.S. economy hostage through debt ceiling demands. At the White House, then-President Barack Obama argued that linking the debt ceiling to spending reforms was misguided.

 “It’s not a vote that allows Congress to spend more money,” Obama said. “Raising the debt ceiling simply gives our country the ability to pay the bills that Congress has already racked up. It gives the United States of America the ability to keep its word.”

 

Standoff feared

In the end, Congress raised the debt ceiling in 2011 while also imposing spending caps. Shortly thereafter, Standard and Poor’s downgraded the U.S. government’s credit rating based on what it saw as chronic political chaos in Washington.

 

That chaos could prove even more severe in the current debt ceiling standoff, according to analysts.

 

“Breaching the [debt] limit is sufficiently consequential that we should always be worried about whether Congress, especially in periods of dysfunction, can get it done,” Reynolds said. “Also, even if Congress has historically managed to do what’s necessary, how they’ve done that has come with consequences.”

 

In reality, the federal government reached its borrowing limit in March of this year. To avoid default, the Treasury Department took what it termed “extraordinary measures” such as postponing investments in a variety of pension programs for federal retirees.

 

Secretary Mnuchin has advised that Treasury’s ability to use bookkeeping slight-of-hand to avoid default runs out on September 29.

Freed Russian Activist Calls for Boycott of Presidential Elections

A Russian activist freed from prison this week after serving a four-and-a-half-year term said he plans to keep pressuring President Vladimir Putin, and he is encouraging activists to boycott next year’s elections.

Speaking Thursday at a press conference, Leftist Russian opposition figure Sergei Udaltsov said Russian elections are “dishonest” and called for a “consolidated boycott of the elections.”

“The authorities change electoral law like a swindler. They cut off candidates they don’t like from the polls,” he told reporters.

The 40-year-old Udaltsov led a banned leftist organization in street protests in 2011 and 2012 to oppose Putin’s election to a third presidential term. He was convicted in 2014 of fomenting mass riots and served his prison term in full.

Udaltsov said Thursday he would avoid participating in any street-level protests, but he would continue to oppose Putin’s government and press forward in support of various social issues.

“It would be short-sighted of me in my position to come out all guns blazing and call for people to protest,” he said. “You would laugh at me and think I lost my mind — that I spent too much time in jail and now I call for others to protest again.”

While Udaltsov said he would not engage in street protests, he did say he still would be active in the movement and “by fall you will hear about our protests and about our campaign.”

Putin is widely expected to run again in the March presidential contest, with his strongest opposition coming from Alexei Navalny, an anti-corruption politician. Navalny has announced his intentions to run, though he may be unable to participate given his arrest record.

Udaltsov said he would not support Navalny in the upcoming election.

Dutch Police Make Arrests in Contaminated Eggs Case

Dutch police arrested two suspects on Thursday as part of an investigation into the illegal use of a potentially harmful insecticide in the poultry industry, the Dutch prosecution service said.

Millions of chicken eggs have been pulled from European supermarket shelves as a result of the scare over the use of the insecticide fipronil, and hundreds of thousands of hens may be culled in the Netherlands.

Prosecutors said in a statement they had conducted raids at eight locations in the Netherlands and Belgium, confiscating cars and seizing bank accounts and real estate.

The arrested suspects were directors at Dutch company Chickfriend, which is at the center of the scandal. Officials at the company could not be reached for comment.

Raids were conducted at locations linked to Chickfriend, which allegedly used the pesticide, as well as potential suppliers.

The company directors are suspected of threatening public health and possession of a prohibited pesticide, prosecutors said.

The company directors are suspected of threatening public health and possession of a prohibited pesticide, prosecutors said.

 

Egypt Inflation Surges to 33 Percent After Fuel Subsidy Cuts

Egypt’s official statistics agency says the country’s inflation rate has jumped to 33 percent in July – up from 29.8 percent in June.

The announcement comes as Egyptians struggle in the face of steep price hikes as part of the government’s economic reform plan.

 

The Central Agency for Public Mobilization and Statistics made the announcement Thursday.

 

Economists believe the hike is driven by an increase in fuel prices. They expect inflation to remain above 30 percent over the next two months, especially after an increase in electricity, transportation and drinking water prices.

 

Egypt raised fuel prices in June by 55 percent for the commonly used 80-octane gasoline and diesel. It also doubled the price of the butane gas canisters, used in the majority of Egyptian households for cooking.

Hard-pedaling Soft Power, China Helps Launch $13B Belt and Road Rail Project in Malaysia

China and Malaysia broke ground on Wednesday on a $13 billion rail project linking peninsular Malaysia’s east and west, the largest such project in the country and a major part of Beijing’s Belt and Road infrastructure push.

The planned 688-km (430-mile) East Coast Rail Link will connect the South China Sea, large parts of which are claimed by China, at the Thai border in the east with the strategic shipping routes of the Straits of Malacca in the west.

It is among the most prominent projects in China’s controversial Belt and Road Initiative, which aims to build a modern-day “Silk Road” connecting the world’s second-largest economy by land corridors to Southeast Asia, Pakistan and Central Asia and maritime routes opening up trade with the Middle East and Europe.

“The ECRL is indeed yet another ‘game changer’ and a ‘mindset changer’ for Malaysia as it will significantly cut travel time to and from the east coast of the peninsula,” Malaysian Prime Minister Najib Razak said at the ceremony halfway along the route in Kuantan, which faces the South China Sea.

For China, the project is another expansion of its soft power in Malaysia, which also lays claim to some disputed South China Sea islands, and is critical for China’s geopolitical and strategic interests.

“The China government has attached great importance to the China-Malaysia relations and has always considered Malaysia a dear neighbor and trustworthy partner who is committed to seeking mutually beneficial cooperation and common development in the country,” Chinese State Councillor Wang Yong said at the ceremony, heading up a 100-strong delegation in Kuantan.

Najib said the project would be financed with an 85 percent loan from China Exim Bank and the balance through a “sukuk” Islamic bond program managed by local investment banks.

The project is being built by China Communications Construction Co. Ltd.

Beijing has repeatedly come to the rescue of Najib over the last year, as he sought foreign investment that would help him pay off a massive debt piled up by scandal-plagued state fund 1Malaysia Development Berhad (1MDB).

Najib has announced a spree of infrastructure projects in the last few months, many funded by China, as he builds up momentum for a general election that he has to call by mid-2018.

A Nomura research report last month said foreign direct investment inflows from China into Malaysia surged by 119 percent in 2016 and continued to grow at 64 percent year on year in the first quarter of 2017.

The growing closeness to China has raised eyebrows among Najib’s opponents who have argued that the country has become too reliant on Chinese funds.

But Najib dismissed the concerns in a speech on Tuesday, saying turning away from Chinese FDI made “no economic sense.”

There have been protests in Sri Lanka and Thailand over the Belt and Road initiative. A planned rail link through Thailand hit some resistance with what critics said were Beijing’s excessive demands and unfavorable financing.

But Thailand’s cabinet last month approved construction of the first phase of a $5.5 billion railway project to link the industrial eastern seaboard with southern China through landlocked Laos.

Venezuela Exchange Rate Fluctuation Sparks Price Surge

The extreme volatility of Venezuela’s exchange rate has the crisis-hit country’s shop owners hurriedly marking up their merchandise and consumers balking at the higher price tags.

Just last week, the bolivar currency fell around 70 percent on the black market, according to DolarToday, the opaque U.S.-based website that dictates the black market rate.

Although the currency roared back this week to around 10,387 bolivars to the U.S. dollar, prices for often imported products have already been adjusted, heaping more hardship on Venezuelans who often earn only a handful of dollars per month.

“How is it possible that I bought rice a few days ago at 8,000 bolivars, which was already expensive, and now it’s at 17,000,” said housewife Senovia Gonzalez, 64, standing in a line to buy food in the Paraguana Peninsula that juts out into the Caribbean.

The monthly minimum wage in Venezuela is 97,531 bolívars, or not even $1 per day on the parallel exchange rate, making it the lowest in Latin America despite President Nicolas Maduro’s frequent increases. To that is added a 153,000-bolivar food ticket.

His unpopular socialist government has dispatched inspectors to try to contain the price hikes with fines, but that strategy has been largely ineffective in the midst of an economic crisis with triple-digit inflation, recession, and food and medicine shortages.

“If we do not adjust prices, we have to close, fire employees, work for someone else or leave the country,” said Victor Moreno, a seller of home appliances at a mall in Paraguana.

The opposition-controlled parliament said Wednesday that inflation in the first seven months of the year was 248.6 percent. The Central Bank has not published official figures for almost two years, when numbers began to worsen.

Many Venezuelans are horrified at the weakening bolivar, which has lost well over 99 percent of its value in the last three years. Social media users promoted the hashtag #worktoeat this week.

‘Speculators’ threatened with jail

Maduro blames an “economic war” waged by U.S.-backed coup plotters seeking to bring him down. He has threatened to jail “speculators” who raise prices.

Critics say decade-old currency controls and excessive money printing contribute to inflation and a weakening exchange rate.

But with the government increasingly short of dollars to supply the currency control system, more imports are obtained using the black market rate.

In the first half of the year, about 25 percent of all imports were made by private companies using the black market, according to local consultancy Ecoanalitica.

That means Venezuelan prices are even more sensitive to changes on the black market.

“Prices are reacting with aggressive speed,” said the head of Ecoanalitica, Asdrubal Oliveros.

“Not only shop owners, but all the economic actors in the country see that although the rate has strengthened again, it is not sustainable in the long term and in a month will weaken again,” he added.

US Oil Industry Pushes Back on Sanctions Against Venezuela

The Trump administration’s decision on Wednesday to slap sanctions on eight members of Venezuela’s all-powerful constitutional assembly brings to 30 the number of government loyalists targeted for human rights abuses and violations of democratic norms since anti-government protests began in April.

But even as the list of targeted individuals grows longer, promised economic sanctions have yet to materialize amid an outcry by the U.S. oil industry that a potential ban on petroleum imports from Venezuela — the third-largest supplier to the U.S.  — would hurt U.S. jobs and drive up gas costs.

The sanctions announced Wednesday focused on current or former Venezuelan government officials accused by the U.S. of supporting President Nicolas Maduro’s creation of a special assembly charged with rewriting Venezuela’s constitution — a move the U.S. says is an attempt by Maduro to shore up his grip on power.

Since its election last month, the 545-member assembly has declared itself superior to all other government institutions and ousted Venezuela’s chief prosecutor, a vocal critic of Maduro.

The U.S. Treasury Department took the unusual step of sanctioning Maduro himself last month, freezing any assets he may have in the U.S. and blocking Americans from doing business with him.

Newest additions

The newest additions on Wednesday include Adan Chavez, the older brother of Hugo Chavez, who is credited with introducing the late president to Marxist ideology in the 1970s, and a national guard colonel lionized by the government after he physically shoved congress President Julio Borges during a heated exchange caught on video.

While most Venezuelan officials wear U.S. sanctions as a badge of honor — and are frequently rewarded with promotions as a result — Maduro faces a far greater threat if Trump follows through on economic sanctions against the OPEC nation.

For all of Maduro’s anti-capitalist rhetoric, Venezuela, which sits atop the world’s largest oil reserves, remains highly dependent on oil exports to the U.S., especially for importing food and medicine — items in short supply as crude prices have fallen and triple-digit inflation wreaks havoc on the economy.

The Trump administration warned last month that it would take “strong and swift economic actions” against Maduro if he went ahead with plans to seat the constitutional assembly.

But since the election last month, no such action has materialized, leading some of Maduro’s opponents to wonder whether the U.S. president has lost his nerve.

Venezuelan crude and the U.S.

The prospect of an import ban has alarmed U.S. oil companies that rely on Venezuelan crude.

Nine companies, including Chevron, Valero, Citgo and Phillips 66, currently process Venezuelan crude in more than 20 U.S. refineries, most of them located along the Gulf Coast, according to data from the U.S. Energy Information Administration. Many of these refineries are designed for the type of heavy crude that Venezuela exports and replacing those supplies would be disruptive and costly.

An influential industry group whose member include the nine companies has written two letters to Trump warning there is no guarantee that other key sources of U.S. crude imports — Canada, Mexico and Colombia — could provide enough additional supply to replace the Venezuelan oil. Many refineries would likely turn to Saudi Arabia but the higher costs associated with such a shift “could significantly impact fuel costs for U.S. consumers,” according to the letter by the American Fuel & Petrochemicals Manufacturers.

“We want to make sure that we don’t have the unintended consequence of doing more harm to U.S. refineries than the Maduro regime,” said Chet Thompson, the CEO of the group, which represents 95 percent of the U.S. refining sector.

He added that he is hopeful his lobbying is gaining traction.

“We think we’ve come a long way from early July when these sanctions were first being kicked around. … We think folks are a lot smarter on this issue than they used to be,” he said. “We certainly have not received any commitments or promises as far as what they are going to do. But we have done our job.”

The oil industry is finding allies in the U.S. Congress, particularly among lawmakers from the Gulf states.

Six Republican congressmen from three of the states that process Venezuela’s heavy crude — Texas, Mississippi and Louisiana — recently wrote a letter to Trump warning that banning Venezuelan oil imports would do more harm than good.  While applauding the president for his efforts to counter “the disturbing decline of democracy” in Venezuela, the lawmakers, led by Rep. Randy Weber of Texas, said that it could jeopardize 525,000 refining-related jobs along the Gulf Coast.

“We fear that potential sanctions will harm the U.S. economy, impair the global competitiveness of our energy business and raise costs to consumers,” according to the July 28 letter, a copy of which was provided to The Associated Press by a senior Venezuelan official and whose authenticity was confirmed by one of the signatories, Rep. Clay Higgins of Louisiana.

Some Senate Republicans could soon join the chorus. Sen. Bill Cassidy, a Louisiana Republican who sits on the Senate Committee on Energy and Natural Resources, is preparing a letter to Trump raising similar concerns about the impact on the U.S. fuel market, according to his spokesman, John Cummings, who said the senator is rounding up signatories.  

Energy analysts, however, have been more circumspect about the effect on global markets and prices at the pump. A recent analysis by Wells Fargo Securities concluded that one impact would be to raise foreign heavy crude prices by about $3.50 a barrel. However, the ban would not affect demand for gasoline or reduce the overall supply of crude on the global market, as Venezuela would likely redirect its shipments to countries in Asia and elsewhere, albeit at a painful discount.

“We do not believe there would be significant impact on retail prices to U.S. consumers given that the net availability of worldwide crude oil volumes would be unchanged,” the Wells Fargo report said.

Bosnia’s Muslims, Jews, Christians Chide Politicians

Bosnia’s religious leaders say politicians are standing in the way of peaceful coexistence between Muslim, Jewish and Christian communities trying to forgive and forget after the atrocities of a devastating 1990s war.

Hundreds of churches, mosques and synagogues bear witness to more than five centuries of Bosnia’s multi-faith past, and the capital Sarajevo is known locally as a “small Jerusalem” with its main ethnic groups – Orthodox Serbs, Catholic Croats and Muslim Bosniaks – all worshiping within meters of each other.

But Mufti Husein Kavazovic, head of the Islamic community in Bosnia, says people of faith cannot achieve peace alone.

“It is up to political elites to do more. For a start, it would be good that they stop their ideological manipulation of religion for their own political goals. It is up to us, of course, not to allow them to do that,” he said.

Even though nationalists from all three ethnic groups still insist on exclusivity for their own groups, religious leaders are keen to heal rifts after the 1992-1995 war in which about 100,000 civilians were killed and millions displaced.

Friar Zeljko Brkic at Kraljeva Sutjeska – among the oldest Franciscan monasteries in Bosnia and dating from 1385 – said: “Bosnia can only survive as a multi-ethnic state, no matter how much politicians try to convince us that this is not possible.”

His Orthodox, Jewish and Muslim peers agree.

“It is very important that we have here different cultures and religions, and that based on that we can easily build and verify our own identities,” said Nektarije, a deacon at the Orthodox monastery Zitomislici in what is now the Catholic Croat-dominated southern part of the country.

Jakob Finci, the president of the Jewish community in Bosnia, gives Sarajevo as an example of close cooperation, citing Muslims there helping Jews to hide during War World II and Jews providing food for people of all faiths in the three-year siege by Bosnian Serb forces.

“Sarajevo is the best proof that living together is possible and that it represents the only way of life for us,” he said.

This week, about 120 leaders from 27 countries arrived in Sarajevo to take part in a meeting of the youth-led Muslim Jewish Conference, founded by Ilja Sichrovski in Vienna in 2010.

“We feel at home here,” Sichrovski said.

Migrant Boy Called ‘Little Picasso’ Shows Works in Serbia

A 10-year-old refugee, who has been nicknamed “the little Picasso” for his artistic talent, is holding his first exhibition — and donating all the money raised to a sick Serbian boy.

Farhad Nouri’s drawings and photographs were put on display Wednesday in Belgrade, where he has lived in a crowded migrant camp with his parents and two younger brothers for the past eight months.

The family was forced to flee conflict and poverty in their home country of Afghanistan two years ago, traveling through Greece and Turkey before arriving in Serbia.

The boy’s gift for art was spotted during language and painting workshops in Belgrade that were organized by local aid groups for refugees and migrants.

“We quickly realized how talented he was and sent him to a painting school as well as a three-month photography workshop, so this is a retrospective of what he learned there,” said Edin Sinanovic from the Refugees Foundation, a local NGO.

Among Nouri’s works exhibited in the garden of a Belgrade cafe were his drawings of Pablo Picasso, Salvador Dali and Harry Potter. His photographs mostly include scenes from around Belgrade.

In addition to holding his first exhibition, “Farhad wanted to help someone, so he chose to dedicate it to a six-year-old Serbian boy who needs funds for his therapy after brain cancer,” Sinanovic said.

Nouri, who is dreaming of one day moving to Switzerland to become a painter and a photographer, said he wanted to help someone else as well to show how important it is to be good to other people.

“We all need kindness,” he said.

Polish President at Loggerheads With Ruling Party Over Army

Polish President Andrzej Duda has blocked the appointment of new generals, in a fresh sign of tension between the head of state and the ruling nationalist Law and Justice (PiS) party that originally backed him.

Duda cited problems with a proposed new command system under government reform plans as his reason on Tuesday for blocking the appointments. His move came two weeks after he unexpectedly vetoed two controversial bills intended to reform the judicial system.

A source close to Duda’s administration said the nominations concerned around a dozen generals.

Deputy Defense Minister Tomasz Szatkowski said his ministry had invited the National Security Bureau, which advises the president, to help work on the army reform proposals.

“We are always available to the Bureau for additional clarifications or consultations,” Szatkowski told Reuters.

But some security analysts said Duda – who won the presidency in 2015 thanks to the support of PiS – was keen to demonstrate again his independence as both president and as commander in chief of Poland’s armed forces.

“This is probably less about the generals and more about the fact that the president decided it would be appropriate to say loudly and publicly that all options for a dialogue with the Defense Ministry have been exhausted,” said Marek Swierczynski, a security analyst at Polityka Insight, a think-tank.

NATO frontline

The spat comes as Poland plays host to more NATO troops as part of efforts to bolster the alliance’s eastern flank in the face of a more assertive Russia. Moscow has seized Ukraine’s Crimea region and backs armed separatists in eastern Ukraine.

The Polish Defense Ministry presented a new defense concept in May that envisages significantly beefing up its armed forces and overhauling their command system. The president and the National Security Bureau have yet to respond to those plans.

Halina Szymanska, Duda’s chief of staff, told the state TVP Info news channel there was no conflict between the president and the Defense Ministry, but added: “First the work on building the new command and control structures needs to be completed and only then personnel decisions will be taken.”

Tomasz Siemoniak, a former defense minister in the Civic Platform government that lost power to PiS in 2015, said Duda’s stance was a challenge to the authority of PiS leader Jaroslaw Kaczynski, the most powerful man in Poland.

“The PiS leader is facing a difficult decision as to which side to support because this confrontation [between the president and Defense Ministry] is disastrous to the ruling camp and will be devastating for the military,” he told Reuters.

About a quarter of the Polish top brass has quit since PiS took power, citing disagreements with Defense Minister Antoni Macierewicz over personnel and other decisions.

Swierczynski put the current vacancy rate among generals at nearly 50 percent, and he added that Duda’s decision to make his disagreement with the Defense Ministry public could harm Poland’s image in NATO as a stable, reliable ally.

“If we show that we cannot reach a compromise on such a key issue as national security … what does that say?”

Putin in Abkhazia as Georgia Mourns Losses from War With Russia in 2008

Russian President Vladimir Putin traveled to Georgia’s breakaway province of Abkhazia Tuesday to express his support for separatists there and in South Ossetia on the ninth anniversary of a deadly five-day war between Moscow and Tbilisi.

The Georgian government protested against the Kremlin leader’s visit to Abkhazia’s Black Sea resort Pitsunda, and the foreign ministry in Tbilisi denounced Putin’s “cynical action.” NATO said Putin’s trip was “detrimental to international efforts to find a peaceful and negotiated settlement” of the war the two countries fought in 2008.

The foreign ministry said Putin’s trip to Abkhazia was a gesture meant only “for legitimization of forceful change of borders of the sovereign state (Georgia) through military aggression, ethnic cleansing and occupation.”

Georgia sees both Abkhazia and South Ossetia as its sovereign territory, and most of the world agrees. Russia is one of only four nations to recognize Abkhazia and South Ossetia as independent states. Venezuela, Nicaragua and Nauru are the only states to side with Russia on the issue.

Minister urges calm

Georgia maintains that Abkhazia and South Ossetia have been illegally integrated into Russia’s military, political, economic and social system.

Despite Putin’s appearance just 400 kilometers from Tbilisi Tuesday, some Georgian officials counseled calm. “We must not be provoked,” said Ketevan Tsikhelashvili, the minister for reconciliation and civil equality. Writing in the journal Foreign Policy, he noted: “We should keep the peace, as it is vitally important for us.”

Georgia and Russia have never restored diplomatic relations since the brief but deadly war nine years ago. A fact-finding mission commissioned by the European found that more than 400 Georgians were killed during five days of clashes, and nearly 1,750 others were wounded; casualties among Russians and residents of Abkhazia were in the same range, and overall, 150,000 Georgians were displaced from their homes.

Just outside Tbilisi, Georgian leaders marked the anniversary Tuesday by laying wreaths at a military cemetery to honor soldiers who died in the conflict.

Addressing the gathering, President Giorgi Margvelashvili vowed that no Georgian would ever tolerate Russian occupation, and he emphasized his government’s commitment to peaceful negotiations with the aim of fully reintegrating the entire country.

Multiple protests, in Georgia and abroad

Less than 400 meters from Russian military garrisons in South Ossetia, several hundred Georgians linked arms to form human chain along a main road leading into the Russian-controlled territory, according to BBC.

At United Nations headquarters in New York, Georgian-American demonstrators called for a coordinated international response to growing Russian military aggression in Eastern Europe.

Based on the bitter memories of subsequent Russian expansionist moves, such as its invasion of Crimea in 2014, Daniel Kochis of the Washington-based Heritage Foundation said the U.S. should have levied sanctions against Russia as far back as 2008, when it intervened in Georgia.

“I think the administration (of former President George W. Bush) was caught very flat-footed in Georgia,” Kochis said. “We didn’t learn a lesson from Russian actions; we didn’t impose any sort of sanctions and I don’t think we were strong enough discussing illegal actions by Russia. Again, we saw this sort of aggression a few years later in Crimea, and by then, of course, Russia had learned many lessons from the war with Georgia.”

Recent U.S. and EU sanctions against Russia for its actions in Ukraine suggest that Russia may now anticipate consequences for such actions.

US had few options in 2008

Jeffrey Mankoff of Washington’s Center for Strategic and International Studies said the U.S. administration in 2008 had few military or diplomatic choices.

“The U.S. denounced Russian actions in Georgia in 2008, but did not move in a kinetic way,” Mankoff said. “But I also think the U.S. did not have a lot of options: Russia moved very quickly and the fighting was over in five days.”

The Bush and Obama administrations’ efforts to normalize ties with Russia despite its aggressive move into Georgia, Mankoff said, may have militarily emboldened Moscow.

“It is an issue for debate and I do not fault any of them for going down that path [of seeking normalized relations), but the Russians took a lesson (away from Georgia),” Mankoff added. “They determined they could get away with a similar scenario in Ukraine. In some ways, it has been a miscalculation, and it got Russia bogged-down in a conflict in Ukraine. But, ultimately, it has also changed the contours of (Western relations with Russia) in pretty fundamental ways, in a way that the invasion of Georgia did not.”

Abkhazia broke away from Georgia in the early 1990s as the Soviet Union collapsed. In 2008, Russia sent troops into Abkhazia and South Ossetia, claiming that Georgian authorities had abused local residents.

Russia’s forceful intervention gave both regions de-facto independence from Tbilisi, and Moscow has since tightened its control. Despite international condemnation, Russia keeps thousands of troops in the breakaway regions; Georgia considers them an occupation force. The standoff is not static: Georgian authorities have accused Moscow and the separatists of seizing additional territory in recent months.

Pence visit contrasted with Putin’s

On his visit Tuesday, the third since the 2008 war, Putin said he would ease border controls and customs procedures between Russia and Abkhazia, to encourage travel and facilitate trade.

The Kremlin leader’s visit contrasted with U.S. Vice President Mike Pence’s trip last week to Tbilisi, where he was warmly received. Pence strongly reaffirmed Washington’s support for Georgia’s sovereignty and territorial integrity, and denounced Russia’s “aggression” and “occupation” of Georgian territory.

An independent fact-finding mission on the conflict by the Geneva Academy of International Humanitarian Law and Human Rights said the brief war killed 171 Georgian servicemen, 14 policemen, and 228 civilians, leaving 1,747 wounded.

“Sixty-seven Russian servicemen were killed, and 283 were wounded, and 365 South Ossetian servicemen and civilians (combined) were killed,” the report said. The conflict also left an estimated 150,000 people internally displaced.

This story originated in VOA’s Georgian Service.

Some information is from AP and Reuters.

 

History Unearthed as London’s Mail Rail Line Opens to Public

Deep below London’s bustling streets, a piece of once-vital communications technology will soon be roaring back into life after years of disuse — a train.

The train operates on the “mail rail” line — a 6.4-mile underground train track that once transported letters and parcels 70 feet below ground to and from sorting offices on the east and west sides of the city 22 hours each day.

The line, construction of which began in 1915, ceased operations in 2003. It will be opened to the public next month as a tourist attraction, part of the new Postal Museum in the city’s Clerkenwell district.

“Mail rail originally came about because mail was being delayed in London due to congestion in the streets above us,” Adrian Steel, director of the Postal Museum and mail rail, told Reuters.

Visitors can now ride a section of the old track in specially built trains, and explore an engineering depot turned exhibition space.

“One of the biggest jobs we’ve had is finding a way of taking people through these narrow tunnels that were never meant for people to pass through in a way that’s not completely uncomfortable or dangerous,” Steel said.

Apart from their role in delivering mail, the tunnels played a useful role during World War I and World War II.

Construction of the line was halted when war broke out and the space was instead used to store valuable artifacts, and was relied on heavily to avoid mail disruption during the blitz of World War II.

Aside from its unique history, another aspect of the mail rail line sets it apart from other London underground train lines — an absence of rats.

“It’s a rodent-free terminal and under London which is unusual,” Steel said. “Because there were no people on the trains, there is no food for the rats and mice.”

Rail mail at London’s Postal Museum opens to visitors on Sept. 4.

In Croatia, Harvesting Salt the Centuries-old Way

Dozens of glistening pools in a small village on Croatia’s Adriatic coast stand testament to its annual salt harvests from seawater, which use a method largely unchanged for centuries.

The salt works facility in Ston, which says it is the oldest in Europe, consists of 58 pools and covers about 430,000 square meters where the waters of the Adriatic are allowed to seep in and then evaporate, leaving salt behind.

The first of two salt harvests this year kicked off on Tuesday, with around 35 tourists, friends and family of workers raking salt across the pans into gleaming white piles, before transferring to a nearby warehouse by wooden carts.

They expect to harvest some 200 tons of salt in the harvest, with most of it used for industrial purposes while the rest is sold in local markets for use in cooking.