World Bank Approves $500M Grant Package for Afghanistan Projects

The World Bank on Tuesday approved financing worth more than $500 million for Afghanistan to support a string of projects to boost the economy, help improve service delivery in five cities and support Afghan refugees sent back from Pakistan.

The bank said the six grants, including donor money, worth some $520 million would help the Afghan government “at a time of uncertainty when risks to the economy are significant.”

The international troop withdrawal, which began in 2011, and political uncertainties have impacted Afghanistan’s economy, while a worsening security situation has added to budget pressures, the World Bank said.

“The package will help Afghanistan with refugees, expand private-sector opportunities for the poor, boost the development of five cities, expand electrification, improve food security and build rural roads,” the World Bank said in a statement.

In May, a World Bank report said economic growth in the country was likely to pick up this year but not enough to provide jobs needed by its growing population.

The largest chunk of the package, some $205.4 million, will go toward supporting communities affected by refugees returning from Pakistan, the World Bank said. Some 800,000 Afghans have been sent back from Pakistan and Iran, many of them left to rely on subsistence income in rural areas or low-paid work in towns.

In addition, $100 million will support reforms and business development for the poor; $20 million will go to improving services in five provincial capital cities; $29.4 million will help establish wheat reserves and improve grain storage; and $60 million will boost electricity in the western Herat province.

World Bank Approves $500 Million Loan for Tunisia

The World Bank on Tuesday approved a $500 million loan to support Tunisia’s budget, a government official for the North African country said on Tuesday.

The funding followed the release by the International Monetary Fund of a delayed $320-million tranche of Tunisia’s IMF loan, after the government agreed to speed up economic reforms.

Praised as a model of democratic transition following its 2011 uprising to oust autocrat leader Zine El-Abidine Ben Ali, Tunisia has so far mostly failed to deliver on planned economic reforms to help create jobs and cut public deficits.

In a statement, the World Bank said the funding would support economic reforms to improve the business environment and boost investor confidence, as well as help expand access to finance.

“Along with supporting the implementation of the new competition and investment laws, this development policy loan will help the government’s efforts to improve the efficiency of public investments and promote greater participation of the private sector through public-private partnerships,” said Abdoulaye Sy, the bank’s senior economist for Tunisia.

US Weighs Sanctions on Countries Doing Business with North Korea

The United States is weighing imposing sanctions on countries that do business with North Korea and looking for ways to revive strained relations with Russia, U.S. Secretary of State Rex Tillerson said on Tuesday.

At a committee hearing, he also defended President Donald Trump’s plans for steep reductions in U.S. spending on diplomacy and foreign aid. Senators from both major parties charged that such cuts would ultimately hurt America.

At the start Tillerson told lawmakers that North Korea had released Otto Warmbier, a U.S. university student held captive for 17 months, and the United States was seeking the release of three other detained Americans.

Washington has sought to increase economic and political pressure on Pyongyang because of its nuclear and ballistic missile programs. The North has conducted five nuclear tests and is believed to be making progress toward an intercontinental ballistic missile that could hit the United States.

Tillerson said Washington is discussing North Korea with all of its allies, and seeing some response from China, its biggest trading partner. He said North Korea would top the agenda at next week’s high-level talks between U.S. and Chinese officials.

Tillerson said the United States would have to work with other countries to deny North Korea access to basics such as oil and will have to consider whether to impose sanctions on those doing business with North Korea.

“We are in a stage where we are moving into this next effort of, ‘Are we going to have to, in effect, start taking secondary sanctions because countries we have provided information to have not, or are unwilling, or don’t have the ability to do that?'” Tillerson told the Senate Foreign Relations Committee.

Because the United States has no trade with the North, its strongest way to impose economic pressure is through “secondary sanctions” that threaten companies from third countries with losing access to the U.S. market if they deal with Pyongyang.

Ties With Russia at a Low

Asked whether the United States wanted to see an Iran-style global embargo to deny exports of petroleum and other products to North Korea, Tillerson said that this would only work if Russia and China, the North’s main suppliers, cooperated.

Tillerson repeated his view that U.S. relations with Russia were at an all time-low and still deteriorating. Ties have been strained by differences over Syria, Ukraine and allegations, denied by Moscow, of Russian efforts to influence the 2016 U.S. presidential election.

He said the administration was trying to find a way to re-establish a working relationship, notably on Syria.

It took years of diplomacy with Russia and China to achieve consensus among major powers to impose the sanctions on Iran and a similar result with the North seems unlikely given Beijing’s reluctance to destabilize its neighbors.

Asked if China had lived up to its pledges to crack down on the North, Tillerson said its actions had been “uneven,” but added: “They have taken steps, visible steps that we can confirm. We are in discussions with them about entities inside of China.”

The purpose of Tillerson’s appearance, his first of four congressional hearings this week, was to discuss the budget. In all, the Trump proposal cuts about 32 percent from U.S. diplomacy and aid budgets, or nearly $19 billion.

Committee members, including some of Trump’s fellow Republicans, spoke sharply against the plan. Republicans control both houses of Congress, which sets the federal government budget.

Separately, 16 retired senior generals and other ex-military officers said they would submit joint testimony to the Senate on Wednesday about the importance of foreign aid to national security.

Britain, France Announce Joint Campaign Against Online Radicalization

British Prime Minister Theresa May and French President Emmanuel Macron are joining forces in order to crack down on tech companies, ensuring they step up their efforts to combat terrorism online.

Britain and France face similar challenges in fighting homegrown Islamist extremism and share similar scars from deadly attacks that rocked London, Manchester, Paris and Nice.

May traveled to Paris on Tuesday to hold talks on counterterrorism measures and Britain’s departure from the European Union.

She said major internet companies had failed to live up to prior commitments to do more to prevent extremists from finding a “safe space” online. Macron urged other European countries, especially Germany, to join the effort to fight Islamist extremist propaganda on the Web.

The campaign includes exploring the possibility of legal penalties against tech companies if they fail to take the necessary action to remove unacceptable content, May said.

After the Islamic State group recruited hundreds of French fighters largely through online propaganda, France introduced legislation ordering French providers to block certain content, but it acknowledges that any such effort must reach well beyond its borders. Tech-savvy Macron has lobbied for tougher European rules, but details of his plans remain unclear.

Britain already has tough measures, including a law known informally as the Snooper’s Charter, which gives authorities the powers to look at the internet browsing records of everyone in the country.

Among other things, the law requires telecommunications companies to keep records of all users’ Web activity for a year, creating databases of personal information that the firms worry could be vulnerable to leaks and hackers.

Hungary Tightens Rules on Foreign-funded NGOs, Defying EU

Hungary defied the EU and human rights groups on Tuesday by approving strict new rules for non-governmental organizations with foreign funding that further escalates Budapest’s conflict with billionaire philanthropist George Soros.

The law drafted by right-wing populist Prime Minister Viktor Orban’s government requires NGOs that get money from abroad to register with the authorities.

The government says it wants to ensure greater transparency and protect Hungary from foreign influence, but NGOs say the bill stigmatizes them and is intended to stifle independent voices in the central European country.

Orban, 54, has especially focused on NGOs funded by Soros, an American-Hungarian, calling them a “mafia-like” network with paid political activists who threaten national sovereignty.

Foreign universities targeted

His government recently passed a law tightening controls over foreign universities in Hungary, which critics say is aimed at the Central European University founded by Soros.

“It is of vital public interest that society and citizens clearly see what interests these organizations represent,” the NGO law’s authors said in their reasoning. “Foreign interest groups strive to take advantage of civil organizations.”

Orban, who plans to seek re-election in April 2018, has taken control of much of the Hungarian media, curbed the powers of the constitutional court and placed loyalists in top jobs at public institutions since coming to power in 2010.

Along with his tough anti-immigrant rhetoric, such attacks on Soros fit well with Orban’s political agenda. His Fidesz party has a firm lead over the opposition in opinion polls.

Challenge planned

One of the NGOs affected, the Hungarian Civil Liberties Union (TASZ), said it would not comply with the law and would take any legal challenge to international courts.

“The law is a targeted attack and attempt to silence TASZ and all other organizations which have the courage to help those who are oppressed,” it said in a statement.

TASZ receives large contributions from Soros’ Open Society Foundations, as does another human rights group, the Hungarian Helsinki Committee, which also said it would boycott the law.

The laws regulating NGOs and foreign universities have triggered mass protests in recent months in Hungary, and the European Parliament has launched a process that could theoretically deprive Hungary of its EU voting rights — though in practice its ally Poland would be likely to veto such a move.

’Cosmetic’ changes

Orban has gained a reputation in Europe as a maverick leader who holds the liberal West in contempt while forging closer ties with Russia, which will build and finance a big new nuclear power plant in central Hungary.

Russian President Vladimir Putin is expected to visit Hungary for the second time this year in August for a judo world championship. Critics have often seen parallels between Orban’s policies and Putin’s moves in cracking down on his own opposition.

Hungary backtracks

Guy Verhofstadt, president of the liberal group in the European Parliament, urged EU action to protect the rights of civil society in all member states.

“The attempts by some EU governments to silence NGOs are shameful and contrary to the values of the European Union,” he wrote. “The European Commission should … do more to support NGOs inside the EU who face censorship.”

Last week Hungary backtracked on parts of the NGO legislation to meet some of the objections from the Council of Europe’s advisory panel, the Venice Commission.

However, Human Rights Watch (HRW) dismissed the amendments as “cosmetic” and said the law was about “silencing critical voices in society.”

“The amendments do not remove the provision to stigmatize organizations as ‘foreign funded,’ nor the risk of an organization being legally dissolved by the courts if it does not register as ‘foreign funded,’”  HRW said in a statement.

Serious risk to democracy

Soros’s Open Society Foundations, which disburse funding to several prominent NGOs in Hungary, also warned on Monday that the law posed serious risks to democracy in the country.

The law “attacks Hungarians who help fellow citizens challenge corruption and arbitrary power,” OSF director Goran Buldioski said.

The European Parliament adopted a resolution last month condemning Hungary for the “serious deterioration” in the rule of law and fundamental rights, and called on the government to withdraw the bill on foreign-funded NGOs.

 

Ankara Backs Qatar in Saudi-led Showdown

Turkish President Recep Tayyip Erdogan has placed himself at the forefront of the defense of Qatar, in the face of Saudi Arabia-led economic and diplomatic sanctions.

“A very grave mistake is being made in Qatar; isolating a nation in all areas is inhumane and against Islamic values,” Erdogan said in his weekly Tuesday address to his parliamentary deputies. “It’s as if a death-penalty decision has been taken for Qatar,” said Erdogan.

Erdogan is backing his increasingly tough rhetoric with action. A Turkish delegation flew Tuesday to Doha to prepare for the deployment of a military force in Qatar, which ultimately will rise to about 5,000 soldiers. Ankara already has sent large amounts food to break economic sanctions against Qatar.

“The risks, however, are high. If there is an escalation into a confrontation or any kind of hot conflict, this would expose those soldiers to all kinds of threats,” warned retired Turkish ambassador Unal Cevikoz, who heads the Ankara Policy Forum research group.

The Turkish army deployment is part of a military cooperation agreement with Qatar made before the crisis that also includes naval and air components. The army element of the deployment was brought forward by the onset of the crisis, with the Turkish parliament rushing through the required legislation to sanction it.

Playing down risk of military confrontation, analyst Sinan Ulgen a visiting scholar of the Carnegie Institute, points out that only a handful of Turkish soldiers initially will be deployed.

​Politics and diplomacy

“Political and diplomatic side, rather than the military side [of the deployment], will be most important,” said Ulgen, “because Turkey is seen to have adopted a position firmly in support of Qatar that is certainly going to cause complications with other GCC [Gulf Cooperation Countries], primarily Saudi Arabia and Egypt.”

Erdogan’s robust stance in support of Qatar, scotched his foreign minister Mevlut Cavusoglu’s offer to mediate.

“This approach, unfortunately, is becoming a trend and it has developed into a pattern in Turkey’s foreign policy conduct,” lamented Cevikoz. “It is not in line with Turkey’s traditional policy of impartiality toward the problems of the region. The consequences are dangerous, and it has already resulted with Turkey’s isolation in the international community, if not in the region.”

Ankara’s robust support for Qatar is a testament to the deepening relations between the countries. Qatar is fast becoming one of the most important investors in Turkey, buying up banks, media companies, and investing in property.

Those investments accelerated in the aftermath of last year’s failed coup in Turkey, which saw many foreign investors shying away.

But the relationship extends far beyond economics, and a strong relationship has developed between the country’s two leaders.

According to reports not denied by either country, Qatar sent 150 of its special forces to protect Erdogan in the days after the July coup.

Muslim Brotherhood

Foreign policy collaboration, though, is where cooperation appears to be most important.

“Turkey has aligned itself more closely on a number of foreign policy options, which would include support of the Muslim Brotherhood, support of Hamas,” pointed out analyst Ulgen.

Ankara could pay a heavy price for its loyalty to Qatar, however, coming at a time when Turkey already is facing strained relations with most of it Western allies and all of its southern neighbors. Turkish pro government media has been sounding alarm bells, warning that the pressure facing Qatar really is a plot aimed at Ankara and Erdogan.

Kemal Kilicdaroglu, the leader of Turkey’s main opposition Republican People’s Party, voiced concerns about the precarious position facing Turkey over Ankara’s support with Qatar for the Muslim Brotherhood.

“Egypt, Saudi Arabia and the United Arab Emirates are all regarding the Muslim Brotherhood as a terrorist organization,” said Kilicdaroglu, criticizing Erdogan’s public use of Muslim Brotherhood symbols.

Erdogan has made little secret of his support for the Brotherhood, a stance that plays well with his religious base of voters.

“Support of the brotherhood has become part of domestic politics,” pointed out Ulgen.

But Ulgen emphasizes that the pressure facing Qatar cannot be applied to Turkey, although he warns the present crisis likely will put Ankara in an awkward position.

President Donald Trump has been particularly outspoken in support of Saudi Arabia’s stance in demanding that Qatar end its support of the Muslim Brotherhood, along with other radical Islamist groups, but he has remained publicly silent over Ankara’s stance toward the brotherhood. According to Turkish media, Trump and Erdogan are scheduled to talk about Qatar in the coming days.

Trump Administration Looks to Curb CFPB Powers, Change Bank Rules

The Trump administration is proposing to curb the authority of the consumer finance watchdog created following the economic crisis as it drives toward easing restrictions on banks and financial institutions.

The Treasury Department issued Monday the first part of a review that was ordered by President Donald Trump in one of his earliest acts as president.

The report reviewing the Dodd-Frank financial oversight law also urges changes to rules for banks that were put in place under the 2010 law. The law aimed to restrain banks – which received hundreds of millions in taxpayer bailouts – from the kind of misconduct that many blamed for the crisis.

The law was enacted by President Barack Obama and Democrats in Congress to tighten regulation after the 2008-09 financial crisis that sparked the Great Recession that cost millions of Americans their jobs and homes.

Trump, however, has called Dodd-Frank a “disaster” that has crimped lending, hiring and the overall economy. He promised to do “a big number” on it.

“Properly structuring regulation of the U.S. financial system is critical to achieve the administration’s goal of sustained economic growth, and to create opportunities for all Americans to benefit from a stronger economy,” Treasury Secretary Steven Mnuchin said in a statement Monday.

The report outlines what it calls core principles of financial regulation – including overhauling the Consumer Financial Protection Bureau and having more “efficient” bank rules.

The CFPB oversees the practices of companies that provide financial products and services, from credit cards and payday loans to mortgages and debt collection. It has been a prime target of Republican lawmakers, who accuse it of regulatory overreach.

The new report urges Congress to remove the agency’s authority to supervise banks and financial companies, returning that power to other federal and state regulators, respectively. And it proposes enabling the president to remove the CFPB director at will without citing a cause for firing. That’s the subject of a battle now in federal court.

The CFPB’s structure and broad regulatory powers have led to “abuses and excesses,” and hindered consumer choice and access to credit, the report says.

The Treasury report comes a few days after the Republican-led House approved sweeping legislation to undo much of Dodd-Frank, repealing about 40 of its provisions. That was passed on a largely party-line vote of 233-186, but is unlikely to clear the Senate in its current form.

The administration’s report is narrower in scope and ambition than the House-passed legislation. It could provide a blueprint for regulators to rewrite the Dodd-Frank rules, as Trump continues to fill out his team of top financial overseers.

Mnuchin said in separate congressional testimony Monday that he expects to be able to work with the regulators on 70 to 80 percent of the proposed changes. But Congress would need to pass legislation to actually revamp the law – for example, to change the CFPB’s authority.

Among the banking rules, the new report focuses closely on the so-called Volcker Rule, established by Dodd-Frank to generally bar banks from trading for their own profit instead of for customers. The idea behind the rule was to prevent high-risk trading bets that could imperil federally insured deposits.

The report proposes exempting from the rule banks with less than $10 billion in assets and those that have over $10 billion with few trading assets. The House legislation would repeal it altogether.

So-called living wills, the plans that big banks must submit to regulators detailing how they would reshape themselves in the event of failure, should be required every two years instead of the current annual mandate, the report says.

Aaron Klein, a Treasury Department official in the Obama administration, said the proposed changes were unlikely to achieve the economic growth Trump is seeking.

“The financial regulatory system isn’t what is stopping 3 percent economic growth,” said Klein, now a fellow at the Brookings Institution. “If you’re looking in the wrong place, you’re not likely to find the answer.” Better for the administration to find ways to promote investment in the U.S., he suggested.

Klein said the changes proposed for the CFPB would inject more politics into financial regulation. He did see some positive ideas, however, such as increased coordination among financial regulators.

Bank industry groups, which had consulted with Mnuchin and other Treasury officials as they prepared the report, expressed approval of it Monday.

Looking outside Dodd-Frank, the report calls for a task force to reconsider the Community Reinvestment Act, a 1977 law designed to monitor banks’ practices in low-income and minority communities, such as new branch openings. Regulators can fine or sanction banks under the law when they find patterns of discrimination.

The law is widely promoted by Democratic lawmakers and community and civil rights groups.

US Senators Back Legislation Strengthening Russia Sanctions

A group of U.S. Senators agreed Monday on legislation to strengthen sanctions against Russia, including a provision that would require congressional review if the White House relaxed, suspended or terminated sanctions already in place.

The bipartisan agreement comes in the form of an amendment to legislation the Senate is already considering on sanctions for Iran.  The bill is expected to have strong support when it goes before the full Senate, and would have to then pass in the House of Representatives and be signed by President Donald Trump.

A statement from Republican and Democratic leaders on the Senate banking committee said the amendment “expands sanctions against the government of Russia in response to the violation of the territorial integrity of the Ukraine and Crimea, its brazen cyberattacks and interference in elections, and its continuing aggression in Syria.”

The measure would strengthen existing sanctions targeting Russian energy projects, while imposing new sanctions on those involved in serious human rights abuses, supplying weapons to the Syrian government, carrying out malicious cyber activities and doing business with Russian intelligence and defense.

The House and Senate, as well as a special counsel appointed by the Justice Department, are all investigating Russia’s activities related to last year’s U.S. elections, as well as potential links to Trump’s campaign.  The U.S. intelligence community concluded in a January report that Russian President Vladimir Putin ordered an influence campaign meant to hurt Democrat Hillary Clinton and help Trump’s chances of winning.

“These additional sanctions will also send a powerful and bipartisan statement to Russia and any other country who might try to interfere in our elections that they will be punished,” said Senate Democratic Leader Chuck Schumer.

Anne Franks’ Diary Still Resonates, 75 Years Later

“I hope I will be able to confide everything to you, as I have never been able to confide in anyone, and I hope you will be a great source of comfort and support.”

This is the first entry in The Dairy of Anne Frank. She wrote it on June 12, 1942 – her 13th birthday. At that moment, she was a normal teenager living with her family in the Netherlands, where they moved from Frankfurt after Hitler’s rise to power. This was one of Anne’s last diary entries as a carefree teenager. Less than a month later, on July 5, 1942, her family was summoned for deportation to the Westerbork concentration camp.  

“The entry that Anne made in the diary exactly 75 years ago, and what she wrote in the duration of that entire week – that is the last proof of normal life. Friends, plans, prosperity,” said Edna Friedberg, curator of the National Holocaust Museum in Washington. “Instantly, Anne will be in a nightmare world. She will have to literally disappear, physically disappear.”

She did just that, vanishing into an Amsterdam rowhouse. The canal-facing Opekta Building became a shelter for Anne’s family and a few more Jews. They hid in a 46 square meter room behind a door masked as a bookcase. Here, Anne wrote letters to her imaginary friend Kitty about everything that worried her: her relationship with her parents, her first love, arguments over food, violence in the streets below.

The Holocaust survivor Primo Levi wrote that there is a duty not to understand the Holocaust, “because to understand is to justify.” But, he maintained, “If understanding is impossible, knowing is imperative, because what happened could happen again.” Anne Frank’s account remains a terrifying part of truly “knowing” the Holocaust.

“Often in the evening, in the darkness, I see columns of innocent people walking, driven by a pair of scoundrels, who beat them and torture them until they fall to the ground,” wrote Frank. “They don’t spare anybody: the elderly, children, infants, the sick, pregnant women – everyone goes to face death …It’s a terrible feeling to suddenly be an excess.”

Frank’s diary became one of 35 objects included in the Memory of the World Register, a UNESCO World Heritage List. Currently, the book is translated into 67 languages. Every modern schoolchild knows the Jewish girl’s name.

“This is proof that history isn’t statistics and facts, it’s always the fates of people,” said Friedberg.

Anne wrote her last entry in the diary on August 1, 1944. Everybody who was hiding in the building was found, arrested and sent to a death camp. Anne died in the Bergen-Belsen concentration camp in March of 1945.

“In spite of everything, I still believe that people are really good at heart.”’ Friedman stopped reading and looked up. “That’s my favorite quote from her diary. It’s painful to think that the girl believed in humanity until her last days.”

The 15-year-old girl’s 7-month stay at the camp, punctuated by slave labor, hunger and finally death, hardly confirm her optimistic words. Anne’s father Otto was the only member of the family to survive the Holocaust. He decided to publish the diary as proof that his daughter lived, loved and hoped. Anne became the voice of 6 million Jews – the victims of the Holocaust.

“Just think about how many talented and smart children like that were destroyed,” said Friedman.

One-point-five million Jewish children died during the years of the Holocaust. “Multiply this number by a million,” they say at the Memorial Museum in Washington. The lost life of a child is lost generations. Proof of that is the fate of a girl named Louisa, who was in hiding on the same street as Anne Frank. She survived. Today, 75-year-old Louisa Lawrence lives in Bethesda, Maryland and has three daughters and six grandchildren. Most often today, she has to answer the question: How does she feel about the thought that she was able to survive, but Anne, the girl who lived next door, didn’t?

“I am truly sorry for her,” said Lawrence. “But at the same time I’m thankful that my family was able to survive. I remember when The Diary of Anne Frank was published, everyone was uncomfortable. They didn’t want to talk about it, because it was painful, and embarrassing for others. This diary, written with the truthful words of a young girl, forced the world to hear about the horrors of that time.”

Russian Police Detain Hundreds at Corruption Protest on National Day

Police in Russia have detained hundreds of protesters and some journalists at anti-corruption demonstrations in cities across the country on Russia’s national day.  The protests were organized by opposition leader Alexei Navalny, who was detained in Moscow as he left his home to try to join a demonstration in the capital.  VOA’s Moscow Correspondent Daniel Schearf reports that the White House condemned the detentions and said it is monitoring the situation.

Business Confidence Plummets as Political Crisis Grips Britain

Britain’s descent into political crisis just days before Brexit talks begin has sapped confidence among business leaders and infuriated bosses who were already grappling with the fallout from the vote to leave the EU.

The failure by Prime Minister Theresa May to win a parliamentary majority in last week’s election has pushed the world’s fifth largest economy towards a level of political uncertainty not seen since the 1970s.

May called the election to secure a mandate for her vision of a “hard Brexit” – driving down migration by taking Britain out of the single market and the customs union. Instead, she got a hung parliament in which no single party has a majority. Business leaders demanded a re-think.

“The U.K. has had a reputation, earned over the generations, for stability and predictability in its government,” a senior executive at a multi-national company listed on the London FTSE 100 told Reuters on condition of anonymity. “That reputation in 12 months has been destroyed, truly destroyed. First by Brexit and now through this election.”

A survey by the Institute of Directors (IoD) found only 20 percent of its nearly 700 members were now optimistic about the British economy over the next 12 months, compared with 57 percent who were quite or very pessimistic.

The IoD survey, taken after the election, found a negative swing of 34 points in confidence in the economy from its previous survey in May.

“It is hard to overstate what a dramatic impact the current political uncertainty is having on business leaders, and the consequences could — if not addressed immediately — be disastrous for the U.K. economy,” said Stephen Martin, director general of the IoD.

The collapse in confidence, which follows a short-term drop after last year’s Brexit vote, coincides with a slowdown in the wider economy that has taken hold since the start of this year, as rising inflation pushes up the price of goods.

Figures from credit card firm Visa showed British consumers turned more cautious even before the shock election result, with households cutting their spending for the first time in nearly four years last month.

The Confederation of British Industry (CBI) warned there was now a risk businesses would cut back on investment which has largely held up since last year’s Brexit vote.

And the trade group that represents manufacturers, the EEF, said its members were having to navigate the most uncertain political territory in Britain for decades.

Both groups called on the government to rethink its approach to Brexit, saying the country needed tariff-free access to the single market and a steady flow of migrant workers.

Some executives hoped the political paralysis would lead to a ‘softer Brexit’, with access to markets prioritized over a clamp down on immigration.

“Here we are again: another bolt from the blue, a political earthquake that we didn’t think used to happen in the U.K.,” CBI Director General Carolyn Fairbairn said at a conference hosted by the Resolution Foundation. “But I do think there are opportunities in this, and it is an opportunity to refocus back on the economy to talk about jobs, growth, future prosperity.”

Having slid to its lowest for nearly two months against the dollar on Friday, the pound fell broadly again on Monday.

Left in limbo

Business executives warned the political uncertainty could be felt across a wave of sectors.

Leaders of the drugs industry warned of the hazards of government limbo at a critical time for the highly regulated sector as companies seek clarity on the rules that will govern their business after Brexit.

Andy Bruce, the CEO of Lookers, one of Britain’s biggest car dealerships, said the lack of a clear result meant the highly successful industry had now entered “uncharted waters” in terms of how many new cars it could sell.

And Martin Sorrell, CEO of WPP, the world’s largest advertising agency, told Reuters he feared increased economic uncertainty, which meant “weak investment and postponement of decision making.”

“Now it seems that we could have no deal because of the short time fuse and lack of decisive government decision making, or a soft Brexit, the latter with more movement and membership of the single market,” he said.

Bankers, at the heart of London’s huge financial center, cautioned of the impact on takeover activity.

“So long as uncertainty is there I don’t see that as particularly positive for M&A in the short term,” Karen Cook, chairman of investment banking at Goldman Sachs said at the Reuters Global M&A summit.

Gareth Vale, marketing director at recruitment group Manpower, said its clients were very apprehensive, and had not yet fully grasped the impact that Brexit would have.

“I think the uncertainty around Brexit, and more recently the general election, has created a sense of almost inertia, which has prevented them from considering some of the bigger seismic shifts that are on the horizon.”

Treasury: Trump Has Plan If Debt Limit Not Raised by August

The Trump administration has a backup plan to keep the government from defaulting on its financial obligations even if Congress misses an August deadline to raise the debt limit, Treasury Secretary Steven Mnuchin told a congressional panel Monday.

Mnuchin had previously set an August deadline for the federal government to avoid a catastrophic default. Mnuchin said he still prefers that Congress increase the government’s authority to borrow before lawmakers leave on a five-week break in August.

However, he said he is “comfortable” that the Treasury Department can meet the government’s financial obligations through the start of September. Private analysts say Mnuchin probably has even greater leeway.

“If for whatever reason Congress does not act before August, we do have backup plans that we can fund the government,” Mnuchin said without elaborating. “So I want to make it clear that that is not the timeframe that would create a serious problem.”

The federal government technically hit the debt limit in March, but Treasury has been using accounting steps known as “extraordinary measures” to avoid a default.

Shortly before Mnuchin testified, a Washington think tank projected that despite the slowdown in revenues, the government will have enough cash to pay its bills until October or November.

The Bipartisan Policy Center says that revenue results from this month’s quarterly tax payments could clarify the deadline, but for now it forecasts that Mnuchin has sufficient maneuvering room to keep the government solvent into the fall. The policy center says a big Oct. 2 payment into the military retirement trust fund could trigger default.

As of Friday, the Treasury had a cash balance of $148 billion, down from $204 billion a month ago. The national debt is nearly $20 trillion, including money owed to several federal programs.

Vote on debt limit

Raising the debt limit has become a politically-charged vote in Congress, even though economists believe that an unprecedented default would be catastrophic for the economy. Republicans, who control Congress and the White House, are struggling to come up with a strategy to raise the debt limit, with some GOP members demanding spending cuts in exchange for their vote.

But since Republicans have many members who simply refuse to vote for a debt increase, GOP leaders such as Speaker Paul Ryan of Wisconsin may have no choice but to seek help from Democrats, who are demanding that any debt limit hike be “clean” of GOP add-ons.

Lawmakers are trying to deal with the debt limit while at the same time a House panel is beginning work on spending bills to fund the government.

Republicans controlling the House are taking the first steps to approve President Donald Trump’s big budget increase for veterans’ health care and the Pentagon.

Spending bill

At stake is an $89 billion spending bill for the Department of Veterans Affairs and Pentagon construction projects that’s scheduled for a preliminary panel vote on Monday. The bill would give the VA a 5 percent budget hike for the budget year beginning in October as the agency works to improve wait times and correct other problems.

The Defense Department, meanwhile, would receive a $2 billion, 10 percent increase for military construction projects at bases in both the U.S. and abroad.

“This legislation includes the funding and policies necessary to deliver on our promises to our military and our veterans,” said House Appropriations Committee Chairman Rodney Frelinghuysen, a Republican from New Jersey.

Republicans are still struggling to come up with a broader budget that would dictate spending levels for other agencies. Trump has proposed sharp cuts to many domestic agencies and foreign aid as a means to pay for increases for the military. But many GOP lawmakers have already signaled that they disagree with Trump.

Under Washington’s arcane budget rules, lawmakers are first supposed to pass an overall fiscal blueprint called a budget resolution before tackling the annual round of spending bills. This year, that budget plan is also the key to unlocking action later this year on legislation to overhaul the tax code, a top GOP priority.

Instead, Republicans are split into three camps on spending: defense hawks who want even more money for the military than proposed by Trump; pragmatists who are defenders of domestic programs; and conservatives who agree with Trump’s plan to cut domestic agencies and deliver the proceeds to the Pentagon.

For now, those GOP divisions have meant an impasse for Trump’s overall budget and tax agenda.

GE CEO Immelt Stepping Down, Flannery to Take Over Role

General Electric says Jeff Immelt is stepping down as CEO. John Flannery, president and CEO of the conglomerate’s health care unit, will take over the post in August.

 

The 61-year-old Immelt will stay on as chairman until his retirement from the position at the end of the year, with the 55-year-old Flannery stepping into the role after that.

 

In addition, Chief Financial Officer Jeff Bornstein was named vice chair.

 

GE said Monday that the moves were part of its succession plan.

 

Shares of General Electric Co. climbed more than 2 percent in premarket trading.

 

 

Polish Minister Hails Planned Trump Visit as Government Success

Poland’s defense minister is hailing an upcoming visit by U.S. President Donald Trump as an “enormous event” and a success of his conservative government.

 

The White House said Friday that Trump will visit Poland on July 6 before he joins the Group of 20 summit in Germany. It said the visit to Poland is meant to reaffirm America’s “steadfast commitment to one of our closest European allies.”

 

Defense Minister Antoni Macierewicz said late Sunday the upcoming visit, which Poland had sought, “is an enormous event showing how much Poland’s place in geopolitics and world politics has changed” under his party, Law and Justice, which took power in 2015.

 

The nationalist party shares Trump’s opposition to Muslims migrants and, like the U.S. leader, talks of restoring national greatness.

May Clings On As British Business Issues Warning

British business leaders are stepping up their Brexit-related demands, seeking to capitalize on last week’s election which saw Theresa May’s ruling Conservatives weakened and denied an outright parliamentary majority.

They are lobbying for the government to negotiate a much closer relationship with the European Union than previously planned by the embattled May, who appears determined to cling to power, at least in the short term, in the face of fury in the party over last week’s election result.

“We must have access to the European market — it is our biggest trading partner,” said Stephen Martin of the Institute of Directors, a lobbying group for business leaders. Business confidence has plunged since last Thursday’s upset election amid signs of a sharp economic slowdown, and company bosses blame uncertainty over the make-up of the government and over Brexit, according to a survey taken by the institute of its members.

Business demands

“It is hard to overstate what a dramatic impact the current political uncertainty is having on business leaders, and the consequences could — if not addressed immediately — be disastrous for the UK economy,” said Martin. Nearly 72 percent of IoD members said “reaching a new trade agreement with the EU” should be the highest priority of the new government.

Business leaders, who view the election result as a rebuff of May’s “hard Brexit” plan, are urging the prime minister to confirm quickly the residency rights of three million European nationals already living in Britain, arguing they are crucial for key sectors of the British economy. They also at the very least want non-tariff access to the Single Market.

Airbus, the aerospace giant, has laid out non-negotiable demands to the government on Brexit, including freedom of movement of their workers and maintaining regulatory harmonization with the EU, warning that if the demands aren’t met production will be shifted overseas. The company employs 10,000 workers in Britain and says another 100,000 British jobs are dependent on Airbus remaining in the country.

Uncertainties

But as business leaders demand a rethink of Brexit, it remains unclear what direction the twisting and turning May will take. The moves she has made so far to shore up her precarious position are sending mixed signals.

In a bid to stave off a leadership challenge, May has avoided making major changes to her Cabinet, leaving those most likely to challenge her for the leadership in the positions they held before last week’s election. Before the election she’d planned a major cabinet shake-up.

But she has brought into the Cabinet arch-Brexiter Michael Gove, while at the same time promoting longtime friend the pro-EU Damien Green to act as her deputy. It appears that May is searching for a way to balance the demands of moderates and hard Brexiters in a desperate bid to cling to power.

But threading the needle isn’t easy. She isn’t being helped by her Brexit minister, David Davis, who when asked in a television interview Monday whether the government should now listen to business and pursue a softer break with Europe insisted the hard Brexit plan hadn’t changed.

In a TV interview Sunday, Michael Fallon, the defense minister, had indicated the reverse, saying: “We want to work with business on this.”

In search of alliances

Senior party figures outside the Cabinet maintained a drumbeat of disapproval of May Monday, predicting she would have to leave shortly. Anna Soubry, a former minister who campaigned last June for Britain to stay in the EU during the Brexit referendum, said May’s position was “untenable.”

And Chris Patten, a former Conservative Party chairman, was highly critical of the parliamentary voting alliance May is concluding with Northern Ireland’s Protestant fundamentalist Democratic Unionist Party to boost her minority government, describing it as “lamentable.” “These are not people we can trust,” he said.

The ten Unionist lawmakers will give May a slight working majority in the House of Commons.

There are mounting fears that the voting alliance with the DUP risks unraveling the Northern Ireland peace process, which relies on the British government acting as a neutral broker between the DUP and the Catholic nationalist Sinn Fein.

Irish Republicans condemned Monday the voting arrangement being discussed between the DUP and the Conservatives, warning it would “end in tears.” Northern Ireland has been without a devolved administration for three months following the collapse of power sharing as a result of disputes between the DUP and Sinn Fein.

May was due late Monday to appear before the 1922 Committee, a gathering of backbench Conservative lawmakers. It will be crucial for her to convince the party she should stay on — at the very least to avoid another election or to give an opening to the Labour Party to form a minority government instead.

Russia Opposition Leader Navalny Arrested Ahead of Protest

Protests spearheaded by prominent opposition figure Alexei Navalny were taking place across the country on Monday, but Navalny himself was reportedly arrested outside his Moscow home en route to the centerpiece demonstration in the capital city.

 

Navalny’s wife, Yulia, said on his Twitter feed that he was arrested about a half-hour before the demonstration was to begin. There was no immediate statement from police.

 

Although city authorities had agreed to a location for the Moscow protest, Navalny called for it to be moved to Tverskaya Street, one of Moscow’s main thoroughfares. He said contractors hired to build a stage at the agreed-upon venue could not do their work after apparently coming under official pressure.

 

Tverskaya, known in Soviet times as Gorky Street, was closed off to traffic on Monday for an extensive commemoration of the national holiday Russia Day, including people dressed in historical Russian costumes.

 

After the change, Moscow police warned that “any provocative actions from the protesters’ side will be considered a threat to public order and will be immediately suppressed.”

 

A regional security official, Vladimir Chernikov, told Ekho Moskvy radio that police would not interfere with demonstrators on the street – as long as they did not carry placards or shout slogans.

 

More than 1,000 protesters were arrested at a similar rally March 26.

 

The protests in March took place in scores of cities across the country, the largest show of discontent in years and a challenge to President Vladimir Putin’s dominance of the country.

 

The Kremlin has long sought to cast the opposition as a phenomenon of a privileged, Westernized urban elite out of touch with people in Russia’s far-flung regions. But Monday’s protests could demonstrate that it has significant support throughout the vast country.

 

Navalny’s website reported Monday that protests were held in more than a half-dozen cities in the Far East, including the major Pacific ports of Vladivostok and Khabarovsk and in Siberia’s Barnaul. Photos on the website suggested turnouts of hundreds at the rallies.

 

Eleven demonstrators were arrested in Vladivostok, according to OVD-Info, a website that monitors political repressions.

 

Navalny has become the most prominent figure in an opposition that has been troubled by factional disputes. He focuses on corruption issues and has attracted a wide following through savvy use of internet video. His report on alleged corruption connected to Prime Minister Dmitry Medvedev was the focus of the March protests.

 

Navalny has announced his candidacy for the presidential election in 2018. He was jailed for 15 days after the March protests. In April, he suffered damage to one eye after an attacker doused his face with a green antiseptic liquid.

 

 

Uber Discussing Leave for CEO, Reports Say

The board of Uber was meeting Sunday to consider placing the CEO of the ride-hailing company on leave, according The New York Times and other news outlets.

 

The Times reported that three people with knowledge of the matter have confirmed that Uber’s board was meeting to consider recommendations from a law firm hired to review Uber’s corporate culture and that the board may decide to put CEO Travis Kalanick on temporary leave.

 

The newspaper said its sources requested anonymity because they were not authorized to speak for Uber.

 

Uber Technologies Inc. has been rocked by accusations that its management has fostered a workplace environment where harassment, discrimination and bullying are left unchecked.

 

Uber spokesman Matt Kallman said that he wasn’t sure the company would make a statement after the meeting.

 

Reuters and the tech blog Recode reported the board meeting earlier. The Wall Street Journal also was citing unnamed sources about the meeting.

 

Uber has hired the law firm of former Attorney General Eric Holder to review policies and recommend changes. A report by his firm, Covington & Burling, was expected to be made public soon.

 

Uber announced last week that it fired 20 employees for harassment problems.

 

Under CEO Kalanick, Uber has shaken up the taxi industry in hundreds of cities and turned the San Francisco-based company into the world’s most valuable startup. Uber’s valuation has climbed to nearly $70 billion.

 

Management style at issue

But Kalanick has acknowledged his management style needs improvement. The 40-year-old CEO said earlier this year that he needed to “fundamentally change and grow up.”

 

In February, former Uber engineer Susan Fowler wrote on a blog that she had been propositioned by her boss in a series of messages on her first day of work and that superiors ignored her complaints. Uber set up a hotline for complaints after that and hired the law firm of Perkins Coie to investigate.

 

That firm checked into 215 complaints, with 57 still under investigation.

 

Uber has been plagued by more than sexual harassment complaints in recent months. It has been threatened by boycotts, sued and subject to a federal investigation that it used a fake version of its app to thwart authorities looking into whether it is breaking local laws.

Kalanick lost his temper earlier this year in an argument with an Uber driver who was complaining about pay, and Kalanick’s profanity-laced comments were caught on video.

 

In a March conference call with reporters after that incident, board member Arianna Huffington expressed confidence that Kalanick would evolve into a better leader. But Huffington, a founder of Huffington Post, suggested time might be running out.

 

He’s a “scrappy entrepreneur,” she said during the call, but one who needed to bring “changes in himself and in the way he leads.”

 

The board meeting comes fresh on personal tragedy in Kalanick’s life. His mother was killed in late May after the boat she and her husband were riding in hit a rock. Kalanick’s father suffered moderate injuries.

 

The Wall Street Journal reported Sunday that Chief Business Officer Emil Michael is planning to resign as soon as Monday.

 

The company has faced high turnover in its top ranks. In March, Uber’s president, Jeff Jones, resigned after less than a year on the job. He said his “beliefs and approach to leadership” were “inconsistent” with those of the company.

 

In addition to firing 20 employees, Uber said Tuesday that it was hiring an Apple marketing executive, Bozoma Saint John, to help improve its tarnished brand. Saint John most recently was head of global consumer marketing for Apple Music and iTunes.

Nadal Wins 10th French Open, Makes Tennis History

Rafael Nadal defeated Stan Wawrinka in straight sets Sunday in the final match of the tennis French Open, winning the grand slam for the 10th time in his career.

“It is really incredible. To win La Decima is very, very special,” the 31-year-old Spaniard said shortly after becoming the only man in tennis history to win a major tournament 10 times.

Defeating Wawrinka of Switzerland 6-2, 6-3, 6-1, Nadal, often referred to as the “king of clay”, showed his dominance over the red clay courts of the French Open, also referred to as Roland Garros in Paris.

“The nerves, the adrenaline I feel when I play on this court, it is impossible to compare … it is the most important event in my career, to win again here is impossible to describe,” he said.

Just one day earlier, history was also made in Women’s Singles at the tournament when 20-year-old Latvian Jelena Ostapenko became the lowest ranked player ever to win the championship.

“I am really happy to win here. I think I’m still — I still cannot believe it, because it was my dream and now it came true,” she told reporters after defeating Simona Halep, who was seeded third in the tournament.

An unseeded player has not won the French Open since 1933.

 

Ukrainians Celebrate First Day of Visa-Free Travel to EU

Ukrainians celebrated the first day of visa-free travel to the European Union Sunday in what President Petro Poroshenko called “a final exit of our country from the Russian empire.”

“The visa-free regime for Ukraine has started! Glory to Europe! Glory to Ukraine!” he tweeted from his official account Sunday morning.

The arrangement will allow Ukrainians with biometric passports to enter all EU member states other than Britain and Ireland for up to 90 days every six months for tourism or to visit family and friends.

Poroshenko met with Slovak counterpart Andrej Kiska Saturday on their common border, opening a symbolic “door to the EU.”

“Welcome to Europe,” Kiska told a crowd. “I want to call on you to continue carrying out reforms.”

Thousands of Ukrainians had crossed into EU countries by midday, according to the Ukranian Foreign Ministry’s consular department.

“#Bezviz [no visa] is just the beginning!” Foreign Minister Pavlo Klimkin wrote on Twitter, accompanied by photos of himself crossing the border into Hungary.

The EU approved the arrangement last month after repeated delays since it promised to cement ties with Kyiv in 2014. Ukraine that year became the scene of the worst confrontation between Russia and the West in Europe since the Cold War, with Moscow annexing Crimea and backing separatist rebels in the east of the country.

Visa-free travel is seen as a step toward Ukraine’s accession to the European Union, though major hurdles remain based on economic instability and fears of furthering escalating the conflict with Russia.

Britain Denies That Trump State Visit Delayed

Prime Minister Theresa May’s office said on Sunday there had been no change to plans for U.S. President Donald Trump’s to come to Britain on a state visit, after the Guardian newspaper reported the trip had been postponed.

The paper, citing an unnamed adviser at May’s Downing Street office who was in the room at the time, reported Trump had told May by telephone in recent weeks that he did not want to come if there were likely to be large-scale protests.

“We aren’t going to comment on speculation about the contents of private phone conversations,” a spokeswoman for May’s office said. “The queen extended an invitation to President Trump to visit the UK and there is no change to those plans.”

The White House had no immediate comment on the report.

No date has been set for the visit, which was agreed during May’s visit to Washington in January, but British media had reported it was planned for October.

Trump has come under fire in Britain this month for his public criticism of London Mayor Sadiq Khan’s response to an attack by Islamist militants in London, in which eight people were killed. May found herself forced to defend Khan, who is from the opposition Labour party.

At that time, Foreign Secretary Boris Johnson said there was no reason to cancel the visit, while White House spokesman Sean Spicer said that Trump intended to go and that “he appreciates Her Majesty’s gracious invitation”.

Russia Warns US Not to Strike Syrian Pro-government Forces Again

Russia said on Saturday it had told the United States it was unacceptable for Washington to strike pro-government forces in Syria after the U.S. military carried out an airstrike on pro-Assad militia last month.

Russian Foreign Minister Sergei Lavrov relayed the message to U.S. Secretary of State Rex Tillerson in a phone call on Saturday initiated by the U.S. side, the Russian Foreign Ministry said in a statement.

U.S. officials told Reuters last month that the U.S. military carried out the airstrike against militia supported by the government of President Bashar al-Assad, which it said posed a threat to U.S. forces and U.S.-backed Syrian fighters in the country’s south.

Russia said at the time that the U.S. action would hamper efforts to find a political solution to the conflict and had violated the sovereignty of Syria, one of Russia’s closest Middle East allies.

“Lavrov expressed his categorical disagreement with the U.S. strikes on pro-government forces and called on him to take concrete measures to prevent similar incidents in future,” the ministry said.

The two men had also exchanged assessments of the situation in Syria, it added, and confirmed their desire to step up cooperation to try to end the conflict there.

The ministry said Lavrov and Tillerson had also discussed the need to try to mend the rift between Qatar and other Arab nations through negotiations, and had talked about the state of U.S.-Russia relations and planned meetings between officials from the two countries.

Amsterdam Police See No Terrorism in Car-pedestrian Incident

Amsterdam police said there was “no indication whatsoever” of terrorist involvement in an incident Saturday in which eight pedestrians were struck and injured by a car.

The car was parked illegally near Amsterdam Central Station, the city’s main rail terminal, police said. When officers approached the driver, the car lurched forward into a retaining wall, striking several pedestrians.

The police later tweeted, after speaking with the driver, that the incident appeared to have been unintentional. They said the driver had apparently been ill, but he was arrested.

Six of the injured people were hospitalized, a police spokeswoman said, adding that two were in serious condition.

Attacks over the past three weeks in England, beginning with a deadly suicide bombing at a concert hall in Manchester, and other terror-related incidents have put authorities in many European countries on high alert.

Trump to Visit Poland in July, Before G-20 Summit in Germany

U.S. President Donald Trump will visit NATO ally Poland before he heads to Germany for the Group of 20 (G-20) summit in July, the White House announced.

“The visit will reaffirm America’s steadfast commitment to one of our closest European allies and emphasize the administration’s priority of strengthening NATO’s collective defense,” the White House said in a statement late Friday.

Trump will deliver a major speech during the visit, and attend the Three Seas Initiative summit as a symbol of Washington’s “strong ties to Central Europe,” it said.

Leaders from several central, eastern and southern European countries are to meet in the city of Wroclaw in western Poland for the Three Seas summit on July 6-7.

The G-20 summit takes place in Hamburg on July 7-8.

UN: Cyprus Peace Talks to Resume in Geneva on June 28

Peace talks on divided Cyprus are to resume in Geneva on June 28, the United Nations said Friday, ending a stalemate on procedure that had threatened to derail two years of negotiations.

Talks between Greek Cypriot leader Nicos Anastasiades and Turkish Cypriot leader Mustafa Akinci stalled last month in disagreement about a conference in Geneva including Britain, Turkey and Greece that would address post-settlement Cyprus security issues.

Both leaders met with U.N. Secretary-General Antonio Guterres on Sunday in New York and agreed to resume talks.

They will both travel to Geneva for the negotiations later this month, U.N. spokesman Stephane Dujarric said in a statement Friday, along with Greece, Turkey and Britain as guarantor powers, and the European Union as an observer.

Cyprus was split in a Turkish invasion in 1974, triggered by a brief Greek-inspired coup.

Security issues related to the presence of up to 30,000 troops in the breakaway north of the island are a key sticking point in talks. Greek Cypriots perceive their presence after a settlement as a threat, while Turkish Cypriots say the troops are necessary for their security.

London Bridge Attacker Tried to Rent Larger Truck

The carnage of the London Bridge attack could have been worse: One of the attackers tried to rent a larger truck that could have killed more people, but his payment was declined. The bloodthirsty gang was also shot dead before they could make their way back to the van where their petrol bombs were stored.

In a rare glimpse into the weeklong investigation, police released details on Saturday that showed Khuram Butt originally tried to rent a 7.5 ton truck. The intended truck was smaller but similar to the one used in the Nice attack last year that killed 86 people and injured hundreds in the resort town in the south of France.

After his payment was declined, Butt and his two accomplices rented a smaller van that they used to plow into crowds before they leapt from the vehicle and went on a stabbing rampage in an attack that left eight people dead and nearly 50 people injured. It was the third such deadly attack in Britain in the three months.

​Knives featured pink blades 

After leaving the small white van, the men used 12-inch knives with bright pink blades, according to Dean Haydon, head of the Metropolitan Police’s Counter-Terrorism Command.

 

Police also disclosed that multiple petrol bombs were discovered in the van, and a copy of the Quran opened at a page “describing martyrdom” was found at one of the attackers’ houses.

Investigators believe three victims were killed on the bridge, including one man who was thrown into the Thames River, before the attackers left the vehicle and stabbed five people to death around London’s busy Borough Market, Haydon said. Police believe Butt was driving the van.

“When I come back to Butt trying getting hold of a 7.5 ton lorry — the effect could have been even worse,” he said.

Molotov cocktails found

More than a dozen wine bottles filled with flammable liquid and rags wrapped around them in the shape of Molotov cocktails were found in the van. Two blow torches were also found.

Haydon said the men may have been planning even more bloodshed if they had survived their stabbing spree and made it back to the van.

 

Police also found a number of office chairs, gravel and a suitcase in the van.

Detectives believe the gravel may have been placed in the vehicle to make it heavier, or as part of a cover to justify hiring it, while the chairs may have been used to convince family and friends they were moving furniture.

Butt, a 27-year-old Pakistan-born British citizen, and his two accomplices, Rachid Redouane, 30, who claimed to be Moroccan-Libyan, and Youssef Zaghba, a 22-year-old Italian national of Moroccan descent, were shot dead by armed police eight minutes after the first emergency call.

Fake suicide belts

The three attackers were wearing fake suicide belts consisting of plastic water bottles wrapped in grey duct tape.

Haydon described the pink knives as “pretty unusual” and appealed for anyone with information about where they came from to contact police.

Police raided Redouane’s small residence on Tuesday and said he had been renting it since April. This was the safe house where the attack was planned, police said. In the residence, police found an English language copy of the Quran opened at a page describing martyrdom, pieces of cloth which appeared to match material wrapped around the petrol bombs and water bottles similar to those used in the fake suicide vests, police said. Luggage straps, plastic retractable craft knives and rolls of duct tape were also found.

Eighteen people have been arrested in connection with last week’s attack. All but five have been released. Searches are continuing.

Questions remain

The question remains how the men met and knew one another but police said Saturday they did not suspect a wider plot.

 

“It looks as if it is pretty much a contained plot involving the three of them, which is supported by the forensic evidence we’ve got back so far,” Haydon said.

Butt, who police consider the attack ringleader, had been on bail after being arrested for fraud in a case in October of last year, police said. He had also been repeatedly reported to police for violent behavior and trying to recruit young children to the Islamic State group as well as featuring in the documentary, “The Jihadis Next Door,” where he was seen next to a group of men unfurling a black-and-white flag scrawled with Arabic script and associated with the Islamic State group.

Warned by police

 

“There was no evidence uncovered of any attack-planning in relation to him,’ Haydon said.

Butt had been warned by police on two occasions — once for fraud in 2008 and once in 2010 for assault. Still, he did not have any criminal convictions.

Zaghba and Redouane lacked any criminal convictions or such warnings in Britain.

“From what I’m seeing, there is nothing that suggests at the moment that we got that wrong,” Haydon said, referring to Butt.

 

US Commerce Chief Seen Imposing Mexico Sugar Deal Over Industry Objections

U.S. Commerce Secretary Wilbur Ross is likely to impose a new sugar trade deal with Mexico even if final revisions to it fail to win support from the U.S. industry, trade lawyers and experts say.

After announcing a deal this week that would dramatically cut the amount of refined sugar that Mexico ships to the United States, officials from the two countries are working with their industries on final language that would govern its operation.

At issue is a new right of first refusal granted to Mexico to supply all U.S. sugar needs not met by domestic suppliers or other foreign quota holders.

A coalition of American sugar cane and beet farmers and a major refiner want a more explicit guarantee that the U.S. Department of Agriculture, not Mexican producers, will dictate what type of sugar fills that gap. They are worried that a flood of refined sugar will pour in, rather than the raw sugar needed to keep U.S. mills running.

Sugar, lumber issues

The final sticking point stands in the way of resolving a years-long dispute over Mexican access to the highly regulated U.S. sugar market, which is protected by a complex web of subsidies and rationed quotas for foreign producers.

The sugar industry is known for its sway in Washington. But its point of view on Mexican imports is not shared by sugar users such as confectioners and soda makers.

The Trump administration wants to clear away the sugar dispute and a lumber trade row with Canada before starting full-scale negotiations to revise the North American Free Trade Agreement.

An industry rarely objects to a government-negotiated settlement of its anti-dumping case, and U.S. sugar producers could do little to stop the Commerce Department from implementing a final deal after a two-week comment period, said Seattle-based trade lawyer William Perry, who previously worked at Commerce and the U.S. International Trade Commission.

‘Never entirely happy’

While the industry could ask the International Trade Commission to overturn the settlement that suspends anti-dumping and anti-subsidy duty orders issued in 2014, chances for success look slim. The panel in 2015 rejected a challenge by two sugar refiners to the previous U.S.-Mexico pact.

“Petitioners are never entirely happy with suspension agreements like this,” Perry said. “They would rather have anti-dumping and countervailing duty orders with rates high enough to shut out imports.”

A Commerce spokesman said that Ross hoped the U.S. sugar industry would ultimately endorse the final agreement.

Willing to compromise

Gary Hufbauer, a trade expert at the Peterson Institute for International Economics, said the administration was probably willing to compromise on some industry-specific concerns to help reach its larger NAFTA goals of reducing U.S. trade deficits.

The U.S. sugar industry must probably present evidence of new Mexican dumping before going back to Commerce for more changes to the deal, said Daniel Pearson, a senior fellow of the libertarian Cato Institute and former International Trade Commission chairman.

“They would do well to take this agreement and run with it and see how it works,” Pearson said, noting that it raises prices and keeps U.S. refiners well-supplied with raw sugar.

Mexico OK with language

Mexico made major concessions to maintain its access to the lucrative U.S. market, agreeing to ship no less than 70 percent of its quota volume as raw sugar to U.S. refineries. It gave ground on nearly all of the U.S. producers’ demands.

American Sugar Alliance spokesman Phillip Hayes said the final hurdle should be easy to address by making clear that the USDA, not Mexico, can dictate the type and purity level of any additional imports.

But Juan Cortina, head of Mexico’s main sugar trade group, said there was no problem with the language because any additional needs would filled with raw sugar, as Mexican producers would have to keep higher inventories of that grade.

May Struggles to Hang On as Election Plunges Britain Into Political Chaos

Britain has been plunged into political chaos after a shock result in Thursday’s general election that saw the ruling Conservative Party’s majority wiped out.

Prime Minister Theresa May called a snap poll hoping to boost her mandate for talks on Britain’s exit from the European Union, due to start next week. But the Brexit timetable has been thrown into jeopardy as the opposition Labor Party saw its vote share soar.

May on Friday resisted calls to quit — calls that came even from senior figures in her party.

After visiting Queen Elizabeth II on Friday, a part of electoral procedure, May announced she would try to form a minority government supported by the Democratic Unionist Party, or DUP, from Northern Ireland.

“Our two parties have enjoyed a strong relationship over many years, and this gives me the confidence to believe that we will be able to work together in the interests of the whole United Kingdom,” May said.

Solid majority seen vital

The prime minister maintained that the Brexit talks would begin as planned next week, but with her party’s loss of 13 seats and its parliamentary majority, May will rely on the support of the DUP vote by vote. That is simply unsustainable, said political analyst Ian Dunt, author of the book Brexit: What the Hell Happens Now?

Minority governments in Britain “have very bad track records — they always get torn apart. The system doesn’t like it. When you’re doing that going into Brexit negotiations — some of the most brutal, arduous negotiations this country has ever faced — you don’t have a chance going up against it without really a strong majority.”

So is Britain’s EU exit now in doubt? No, Dunt said, but May’s vision of a so-called “hard Brexit” — in which the U.K. would most likely leave the single European Union market, take full control over its borders, strike new trade deals and apply laws within its own borders — has been rejected.

“She said, ‘Give me a mandate.’ And the answer was, ‘No.’ And that means we have to rethink everything, the entirety of the way we’re doing Brexit,” Dunt said.

The Conservatives’ losses were largely gains for the Labor opposition, which defied polls and predictions to gain 29 seats — a vindication for leader Jeremy Corbyn, whose grip on the party appears to have strengthened.

“We put forward our policies — strong and hopeful policies — and they’ve gained an amazing response and traction,” he said.

Youth vote energized

Among those was scrapping university tuition fees, which energized the youth vote. As one teaching student at the University of London told VOA, “I think most of us here were against Brexit last year. And I don’t feel like the current prime minister or, indeed, the Tory party, has any idea about what to do with Brexit at the moment.”

Elation in the Corbyn camp is tempered by electoral reality, said Dunt, making a comparison to last year’s U.S. presidential campaign.

“In a sort of Bernie Sanders way, he just created this sort of idealistic momentum around young people,” Dunt said. “He’s done something extraordinary. But he still doesn’t have that many seats.”

A year after the Brexit vote, Britain appears as divided as ever — between young and old, left and right, pro- and anti-Europe.

May’s campaign catchphrase of a “strong and stable government” has backfired. Britain looks set for months of political chaos.

L’Oreal Set to Sell The Body Shop to Brazil’s Natura in $1.1B Deal

French cosmetics and luxury goods group L’Oreal has started exclusive talks to sell The Body Shop business to Brazilian makeup company Natura Cosmeticos in a possible 1 billion euros ($1.1 billion) deal.

Earlier this year, L’Oreal had announced it was reviewing its strategy for The Body Shop, which it bought for 652 million pounds in 2006, and the sale of the business had attracted a wide range of bidders.

L’Oreal said on Friday it had received a firm offer from Natura Cosmeticos, and the proposed deal put an enterprise value (equity plus debt) of 1 billion euros on the four-decades-old beauty brand — an innovator in the mass marketing of cosmetics made without animal testing and with natural ingredients.

Founded in 1976 by British entrepreneur Anita Roddick, The Body Shop was a pioneer in its field but had since fallen victim to increased competition from newcomers offering similar products based on natural ingredients with no animal testing.

L’Oreal shares were up 0.7 percent in late session trading, as investors welcomed progress toward a deal and the price tag.

“It’s a good move, given that The Body Shop had been one of the least profitable parts of the L’Oreal business,” said Roche Brune Asset Management fund manager Gregoire Laverne.

Keren Finance fund manager Gregory Moore said the price tag had pleased L’Oreal investors, since earlier reports had stated it could be sold for around 800 million euros.

“The stock has reacted well to the news, because there were some people who thought it could be sold for less,” said Moore, whose firm owns L’Oreal shares in its portfolio.

Shares in Natura fell 2.4 percent on the Brazil stock exchange, with Natura saying it would take on loans to finance the deal.

Natura chief executive Joao Paulo Ferreira said The Body Shop would fit in well with Natura’s similar businesses, such as its Aesop brand.

L’Oreal shares are up around 10 percent so far in 2017, broadly in line with the CAC-40, with the stock having touched a record high earlier this month.

Britain Thrown Into Political Uncertainty; May Battles to Lead Minority Government

Britain was thrown into political uncertainty Friday after the Labour Party, the country’s main opposition, made an extraordinary electoral comeback, denying Prime Minister Theresa May and the ruling Conservatives a majority in the House of Commons, largely thanks to a surge in youth voters.

In what will rank as one of the most remarkable elections in modern British history, May’s gamble to expand her party’s parliamentary majority failed spectacularly, raising doubts that she will be able to persevere and lead a minority government with the support of Northern Ireland’s Unionists.

 

Calls mounted Friday from the Labour Party, the leaders of third parties and from some Conservatives for the prime minister to step down.

 

But May made clear she would struggle on and seek to govern after receiving Unionist assurances. Downing Street officials said May will head to Buckingham Place to ask the Queen for permission to form a government. Her plan is to govern with the support of Northern Ireland’s Unionists and she would have a one-seat majority.

 

May’s plan will be then to face a vote of confidence in the House of Commons next week.

 

Despite their anger at her decision to call a snap post-Brexit referendum election and her conduct of the party’s campaign, Conservative lawmakers appeared ready in the short-term to back her.

 

If May were to lose a Commons confidence vote next week, it would give Labour a chance to form a coalition government of its own, or seek to govern as a minority government, although it is unclear if Labour would be able to do so.

​Calls for May to step down

Labour leader Jeremy Corbyn, who was all but written off at the start of the election campaign 50 days ago, called on the prime minister to resign, saying she should “go and make way for a government that is truly representative of this country.” He said Labour had denied her a “hard Brexit” mandate.

 

“We are ready to do everything we can to put our program into operation,” he added:

 

Former Conservative finance minister George Osborne, removed from the Cabinet by May and now editor of the Evening Standard newspaper, told ITV: “I doubt she will survive in the long term as Conservative party leader.”

 

And former Conservative minister Anna Soubry said May should take personal responsibility for a “dreadful” campaign.

 

Among conservatives there was clear fury at the result, a seismic political shock that could trigger a second election within months. Few commentators appeared to believe that a minority Conservative government is sustainable for more than a few months. “Does she really think she can blunder on?” said Lord Ashcroft, a former Liberal Democrat leader.

​Brexit not the only issue

Exit polls on Thursday night suggesting Britain was heading for a hung parliament prompted gasps at Conservative Party headquarters in London.

 

May focused her party’s election campaign on Brexit, saying she would be able to bring the strength necessary to get the best deal for Britain with the European Union.

 

At the start of the campaign it looked as if she might pull off a landslide victory, but opinion polls showed the race tightening, and May came under criticism for running an aloof campaign that took the voters for granted.

 

A turning point in the campaign appeared to come when the parties unveiled their election manifestos. The Conservatives had to backtrack on plans to make the elderly pay more for residential and social care.

 

May spent more than half of the election campaign in Labour-held seats, demonstrating how confident she was of making gains from a Labour Party led by the most left wing leader in its history, a man the press sees as a throwback to the militant 1970s.

 

With 10 days to go before Brexit negotiations, it remains unclear whether Britain will have a government in place to take on the formal talks — or whether the government that starts the talks will be the government that finalizes them.

 

European officials and lawmakers warned Friday a hung parliament could be a “disaster” that hugely increases the chance of Brexit talks failing. They said political uncertainty would likely delay talks, with Michel Barnier, the EU’s chief negotiator, questioning whether he would have someone to really negotiate with about Brexit.

Guy Verhofstadt, the European parliament’s Brexit representative, described the result as “yet another own goal” for Britain.

Some analysts compared the political situation to 1923, when Conservative Stanley Baldwin failed to win a parliamentary majority, struggled on for a few months as prime minister and then lost a confidence vote in the House of Commons. The king then had to ask Labour to form a minority government.

 

The election result also throws into doubt whether Britain will now seek the hard Brexit that May and the right wing of her party have been advocating. There is now likely a majority across the parties in the new House of Commons for a softer Brexit, one that might see Britain remain in the single market.

 

“What it means is we will have pressure in the House of Commons for a soft Brexit,” said Jack Straw, a former Labour foreign minister. “The math and chemistry in the Commons will be pushing away from a hard Brexit,” he added.

Leading Brexit campaigner Nigel Farage complained about the election result in a tweet, saying May’s failure had put Brexit in jeopardy. Some commentators argued the election could be seen as a second referendum on Brexit, a vote about a ‘hard’ or ‘soft Brexit,’ certainly when it came to the youth vote.

 

Hundreds of thousands of people ages 18 to 34 registered to vote before last month’s closing date, including more than 450,000 on the final day. Voters ages 18 to 24 appear to have voted heavily in favor of Labour. 

China Bike-Share Revolution Brings Convenience, Headaches

Thanks to an explosion of bike share apps and providers, China is rediscovering its love of bicycles. In cities across the country and in the capital of Beijing, a colorful bike-share revolution is taking over on the streets, helping ease traffic snarls and keeping the air cleaner. It is also creating some problems.

China used to be called the “kingdom of bicycles,” and though cars have taken over in a major way, the growing popularity of bike-share apps seems to indicate two-wheelers are making a come back.

​Color revolution

For drab and dusty Beijing, the bike-share color revolution of yellows, oranges and blues is a welcome sight. People of all ages are enjoying the convenience the bikes provide, which combines cell phone technology, and GPS tracking in some cases, to help users find a ride.

Traveling by car across the sprawling, densely populated city is often a nightmare. Even distances of a few kilometers can take up to an hour when traffic is snarling.

Cheng Li, a bike-share user, said he has been driving his car less and using the metro more since he started using the service about six months ago.

“After I get off the metro, I usually have to walk another kilometer or two, so I’ll grab a bike share and go. It’s less stressful,” Cheng said.

For many, the convenience of cycling is its biggest attraction. Beijing’s city government has long had a bike-share program in place, but many of its bike-share stations were inconveniently located. Getting registered for the smart phone based apps is also much easier.

For Zhang Jian, the bike-share revolution is not only convenient, but nostalgic.

“Now, when we’re riding home from work, especially in the evening, when it’s not as rushed, it feels like we’re reliving the past,” Zhang said.

​Great Wall of bikes

But with a growing number of providers, competition is getting increasingly fierce. One key tactic of providers has been to flood the streets with bikes — so much so that sidewalks are almost blocked in some cases.

The surge of bikes has become a major headache for city governments. Users frequently leave bikes in the middle of the street or just dump them on the sidewalk blocking passageways in an already densely populated city.

In Beijing’s southern district of Daxing, authorities have been fighting the surge by seizing the illegally parked bikes that clog streets and metro exits, one transportation worker said.

“Bike sharing is really convenient, but no one is taking care of the problem of illegally parked bikes,” the worker said. Behind her are several thousand bikes that have been seized. It was unclear when or how they would be returned to the companies that made them.

“Since the Lunar New Year, the number of bikes has been growing rapidly. At least 10,000 bikes have been added to the streets (of Daxing) since then, and we’ve collected about a third of that total,” she said.

China’s two biggest operators, Ofo and Mobike, have deployed more than 3 million bikes in scores of cities across the country. And the numbers continue to grow.

Mobike aims to expand to 100 cities at home and abroad by the end of this year.

Bike hunters

While many complain the bike-share revolution has taken over city streets, some like Gao Xiaochao are taking matters into their own hands.

Gao is one of many who call themselves bike-share hunters. Bike-share hunters find and report stolen and vandalized bikes that users deliberately park outside their homes or inside gated communities. With some bike-share apps, riders can report illegally parked bikes or other problems the two-wheelers may have.

Gao uses his lunchtime to find, report and move illegally parked bikes.

“Bike hunting is like a game, a hobby, a way to get some exercise. It’s like a new way of living,” Gao said. “Sometimes, I spend two to three hours looking for illegally parked bikes and it’s just like talking a walk.”

Many like Gao are passionate about bike sharing and what it is doing to help transportation and the city’s notoriously smoggy air.

However, as complaints grow and competition gets increasingly cut-throat, they hope companies will do more to improve their service and not just focus on flooding the streets with bikes to edge out competitors.