Global airlines made a full-throated defense of globalization on Monday at their largest annual gathering, vowing not to give up on climate change agreements and calling for a swift resolution of a diplomatic rift threatening air travel in the Middle East.

Missing from the general meeting of the International Air Transport Association in Mexico was Qatar Airways Chief Executive Officer Akbar Al Baker. Usually a star of the show, he appeared to have left the summit amid a dispute between Arab powers.

Asked about Saudi Arabia and Bahrain’s move to ban Qatari planes from their airports and airspace, IATA Director General Alexandre de Juniac called for openness.

“We would like borders to be reopened, the sooner the better,” he told reporters, expanding on earlier remarks in the opening session.

“Aviation is globalization at its very best,” he had told executives from IATA’s more than 200 airlines. “As aviation’s leaders, we must bear witness to the achievements of our connected world.”

Qatar Airways could not be reached for comment.

The Arab rift was a stark reminder of the political risks to the airlines, which have run up healthy profits even as the global consensus they rely upon comes under the threat of nationalist and protectionist political currents.

Forecasting a third straight year of robust earnings, IATA raised its 2017 industry profit outlook on Monday to $31.4 billion, up from a previous forecast of $29.8 billion.

The IATA also raised its outlook for 2017 industry revenue to $743 billion from $736 billion on expectations that the global economy will post its strongest growth in six years.

The forecast underscored a new golden age for airlines’ profitability even as carriers scramble to meet fast-changing electronics restrictions, pressure to limit emissions and unprecedented scrutiny on social media over their every mistake.

A United Nations representative urged airline leaders to stand by an industry emissions accord known as CORSIA even as U.S. President Donald Trump breaks with a climate pact struck in Paris last year.

“We need to promote implementation of this historic agreement,” said Olumuyiwa Benard Aliu, president of the U.N.’s International Civil Aviation Organization.

IATA’s de Juniac said the airlines would hold fast to their commitments.

“The very disappointing decision of the U.S. to withdraw from Paris is not a setback for CORSIA,” he told the meeting.  “We remain united behind CORSIA and our climate change goals.”
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The U.S. government is investigating complaints that air bag control computers in some Jeep Liberty SUVs can fail, preventing the air bag system from operating properly in a crash.

The probe covers about 105,000 of the vehicles from the 2012 model year.

The National Highway Traffic Safety Administration says in documents posted Monday that it has received 44 complaints about the problem involving a computer that detects crashes and controls air bag deployment. No related injuries have been reported.

Many drivers told the agency that an air bag warning light came on. In some cases the problem was corrected by replacing the computer, while others kept driving their SUVs with the light on.

 
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On the border of China and Kazakhstan, an international free trade zone has become a showpiece of Chinese President Xi Jinping’s signature Belt and Road initiative to boost global trade and commerce by improving infrastructure and connectivity.

Chinese state media are filled with stories about the stunning success of Horgos, the youngest city of China’s new Silk Road. Last month at China’s Belt and Road Summit — its biggest diplomatic event of the year — promotional videos about Horgos’ booming economy ran on a loop at the press center.

But Chinese business owners and prospective investors who had recently visited the China-Kazakhstan Horgos International Border Cooperation Center (ICBC), told Reuters they were disappointed by the disconnect between the hype and reality.

Rather than the vibrant 21st century trading post of Beijing’s grand vision, Horgos is instead developing a reputation as China’s very own tax haven.

“We were so unimpressed by what we saw that after looking around for three hours, we turned around and drove eight hours straight back to Urumqi,” said a businessman from the capital of China’s far western region of Xianjiang, who only wanted to give his surname, Ma, due to the sensitivity of the topic.

Several business owners echoed complaints about poor design and low visitor numbers made by Ma, who visited Horgos to investigate the viability of opening a high-end clubhouse.

“You’ve got Kazakh farmers walking around with plastic bags full of cheap Chinese T-shirts and you want me to open a club for government officials and businessmen to meet inside the zone — which, by the way, you can’t drive your car into and doesn’t have any five-star hotels?” Ma said.

On the Chinese side of the border there are five malls selling cheap consumer goods, though traders complain there are not enough visitors.

“Sometimes I’ll sit here for a whole day and not make a single sale,” said Ma Yinggui, 56, who has a market stall selling clothes. “Some Kazakhs are rich but most are poor. They come and haggle over a 20 yuan [$2.93] T-shirt.”

More than five years after the 5.3-square-kilometer trade zone opened, much of the Kazakh side remains empty.

Only 25 of the 63 projects on the Kazakh side have investors, according to Ravil Budukov, ICBC press secretary on the Kazakh side. About 3,000 to 4,000 people enter from Kazakhstan each day and around 10,000 from China, he added.

The Xinjiang and Horgos governments declined to make officials available for comment to Reuters for this article.

Huang Sanping, a senior Xinjiang government official, told Reuters at a news conference in Beijing that he had just returned from a visit to Horgos, a city “performing extremely well. It’s full of vitality and flourishing.”

China’s tax haven

Beijing has bestowed numerous tax breaks and preferential policies on Horgos hoping to stimulate growth in this strategic border town in Xinjiang, a key link on the new Silk Road between China and Central Asia, where the government says it is battling to defeat Islamist extremism.

According to Horgos’ tax bureau, 2,411 companies registered in Horgos last year, taking advantage of five years of no company tax, and a further five years paying half rate.

At least half those companies are registered in Horgos solely for tax purposes, estimates Meng Shen, director of Chanson & Co, a boutique investment bank in Beijing.

Chinese celebrities are opting to register production companies in Horgos and an increasing number of financial services and IT companies are also registering there, according to Guan Xuemei from Shenzhou Shunliban, a tax advisory firm that recently opened an office there.

But with no obligation to operate from Horgos or even in Xinjiang, it is unlikely this policy will create jobs or bring money to what has long been an economic backwater, say experts.

“In theory this is a good policy because it aims to stimulate the local economy,” said Shen. “But Beijing didn’t think through the fact lots of companies wouldn’t actually want to operate from Horgos, which is very far away from China’s economic centers.”

Those who do trade in the “free trade zone” find they face restrictions from both sides.

The Russian-led Eurasian Economic Union (EEU) — of which Kazakhstan is a member — limits traders from the Kazakh side to importing up to 50 kg (110 lbs) of any goods per month duty-free.

China bans imports of many food products — the Kazakh goods most desired by Chinese consumers worried about food safety at home — and caps traders from taking more than 8,000 yuan ($1,175) worth of goods out each day.

“The EEU is a significant barrier because Russia and Kazakhstan and other Central Asia countries want to develop their own industries, they don’t want to constantly rely on cheap Chinese goods,” said a former Chinese government official turned businessman, who spoke on the condition of anonymity.

Mao Shishi, 44, who currently raises cattle in nearby Qingshuihe, wants to import wool and wild herbs used in traditional Chinese medicine from Kazakhstan to China through Horgos.

“I’m watching and waiting for any policy changes. Right now we can’t import lamb, fish or wild herbs into China,” Mao said.

Logistics thoroughfare

Plans to develop a parallel special economic zone in Khorgos — as it is known on the Kazakh side — as a logistics hub appear to be having more success.

Trade volumes are skyrocketing at the Khorgos Gateway dry port in Kazakhstan, where container freight is lifted off Chinese trains and onto Kazakh ones because of different gauge rail tracks.

“According to our plans, this year we are going to trans-ship around 100,000 TEUs, five times more than we are doing now,” said Asset Seisenbek, head of the commercial department at Khorgos Gateway, referring to “twenty-foot equivalent units,” an industry measure based on standard shipping container sizes.

Electronics giants HP and Foxconn both ship goods through the dry port, which is faster than sea freight but cheaper than air cargo. One container sent by sea to Europe is about three times cheaper than rail, while air freight is between five to 10 times more expensive, according to Seisenbek.

Last month, China’s COSCO Shipping and Lianyungang port took a 49 percent stake in Khorgos Gateway — which Seisenbek sees as an opportunity to attract more Chinese business.

This sort of investment is what Horgos/Khorgos should hang its hat on, according to Ma, the businessman underwhelmed by the international free trade zone.

“The free trade zone doesn’t need to be that successful if the intercontinental trains and roads take off,” he said. “In the grand scheme of things, that’s the main role for this part of the world.”
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The productivity of American workers was flat in the first three months of this year, while labor costs rose at the fastest pace since the second quarter of last year.

Productivity growth was zero in the January-March quarter after rising at a 1.8 percent annual rate in the fourth quarter, the Labor Department reported Monday. It was the weakest performance since productivity had fallen at a 0.1 percent rate in the second quarter of last year but an improvement from an initial reading of a 0.6 percent decline.

Productivity, the amount of output per hour of work, has been weak through most of the current recovery. Many analysts believe finding a way to boost productivity growth is the biggest economic challenge facing the country, but there is no consensus on the cause of the slowdown.

Labor costs rose at a 2.2 percent rate after having fallen at a 4.6 percent rate in the fourth quarter. It was the fastest gain since April-June of last year.

The revision in first quarter productivity had been expected because of the revision to first quarter gross domestic product, the economy’s total output of goods and services. The government initially reported that GDP had risen by a tepid 0.7 percent rate in the January-March perio. But that was revised to show a slightly better reading of a 1.2 percent gain. The boost in output led to the better reading for productivity.

Since 2007, productivity increases have averaged just 1.2 percent. That’s less than half the 2.6 percent average annual gains turned in from 2000 to 2007, when the country was benefiting from increased efficiency from greater integration of computers and the internet into the workplace.

Rising productivity means increased output for each hour of work, which allows employers to boost wages without triggering higher inflation.

The effort to boost productivity back to the levels since before the Great Recession will likely be a key factor in determining whether President Donald Trump will achieve his goal of boosting overall growth from the weak 2.1 percent average seen since the recession. The economy’s potential for growth is a combination of increases in the labor force and growth in productivity.

During the campaign, Trump pledged to double growth to 4 percent or better. Trump last month released a budget that projects faster economic growth will produce $2 trillion in deficit reduction over the next decade but that forecasts expects growth to rise over the next few years to a sustained pace of 3 percent annual gains.

 
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Diversification is a growing trend in some sectors of the agriculture industry. Some winemakers in the northwestern state of Oregon are branching out into marijuana as a new business venture. Faith Lapidus reports.
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The Trump administration is considering possible sanctions on Venezuela’s vital energy sector, including state oil company PDVSA, senior White House officials said, in what would be a major escalation of U.S. efforts to pressure the country’s embattled leftist government amid a crackdown on the opposition.

The idea of striking at the core of Venezuela’s economy, which relies on oil for about 95 percent of export revenues, has been discussed at high levels of the administration as part of a wide-ranging review of U.S. options, but officials said it remains under debate and action is not imminent.

The officials, speaking on condition of anonymity, told Reuters the United States could hit PDVSA as part of a “sectoral” sanctions package that would take aim at the OPEC nation’s entire energy industry for the first time.

Complicating factors

But they made clear the administration is moving cautiously, mindful that if such an unprecedented step is taken it could deepen the country’s economic and social crisis, in which millions suffer food shortages and soaring inflation. Two months of anti-government unrest has left more than 60 people dead.

Another complicating factor would be the potential impact on oil shipments to the United States. Venezuela is the third largest oil supplier for the U.S. after Canada and Saudi Arabia. It accounted for 8 percent of U.S. oil imports in March, according to U.S. government figures.

“It’s being considered,” one of the officials told Reuters, saying aides to President Donald Trump have been tasked to have a recommendation on oil sector sanctions ready if needed. “I don’t think we’re at a point to make a decision on it. But all options are on the table. We want to see the bad actors held to account.”

The U.S. deliberations on new sanctions come against the backdrop of the worst protests faced yet by socialist President Nicolas Maduro, who critics accuse of human rights abuses in a clampdown on the opposition.

Since Trump took office in January, he has stepped up targeted sanctions on Venezuela, including on the vice president, the chief judge and seven other Supreme Court justices. He has pressed the Organization of American States to do more to help resolve the crisis.

While Trump has taken a more active approach to Venezuela than his predecessor Barack Obama, he has so far stopped short of drastic economic moves that could hurt the Venezuelan people and give Maduro ammunition to accuse Washington of meddling.

The two administration officials said the United States is also prepared to impose further sanctions on senior officials it accuses of corruption, drug trafficking ties and involvement in what critics see as a campaign of political repression aimed at consolidating Maduro’s rule.

Oil sanctions big step

But broad measures against the country’s vital oil sector, for which the United States is the biggest customer, would significantly ratchet up Washington’s response. The United States has imposed sectoral sanctions against Russia’s energy, banking and defense industries over Moscow’s involvement in Ukraine’s separatist conflict.

The officials declined to specify the mechanisms under consideration and said the timing of any decision would depend heavily on developments on the ground in Venezuela.

Possibilities could include a blanket ban on Venezuelan oil imports and preventing PDVSA from trading and doing business in the United States, which would have a severe impact on PDVSA’s U.S. refining subsidiary Citgo.

A more modest approach, however, could be to bar PDVSA only from bidding on U.S. government contracts, as the Obama administration did in 2011 to punish the company for doing business with Iran. Those limited sanctions were rolled back after the 2015 international nuclear deal with Tehran.

The Venezuelan government and PDVSA did not respond to requests for comment.

U.S. officials recognize, however, that oil sanctions on Venezuela could exacerbate the suffering of the Venezuelan people without any guarantee of success against Maduro, who accuses Washington and Venezuelan opposition of fomenting an attempted coup.

Given the potential for regional spillover, any decision on oil sanctions would require consultation with Venezuela’s neighbors, the officials said.

“The concern we have is that it will be a very serious escalation,” one official said. “We’d have to be prepared to deal with the humanitarian consequences of essentially collapsing the government.”
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The restaurant business can cause serious heartburn. It’s a mixed salad of bureaucracy, money, and paperwork that keeps some chefs from ever selling that first plate of food. But there may be hope as “restaurant incubators” offer chefs an alternative menu for success. Arash Arabasadi reports from Washington.
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Rick Perry twice ran for president and appeared as a contestant on TV’s Dancing with the Stars.

But since becoming President Donald Trump’s energy secretary, Perry has kept a low profile and rarely has been seen publicly around Washington. Comedian Hasan Minhaj joked at the White House Correspondents’ Association dinner that Perry must be “sitting in a room full of plutonium waiting to become Spider-Man. That’s just my hunch.”

In truth, Perry has been busy — but far away from the capital.

He has toured Energy Department sites around the country, represented the Trump administration at a meeting in Italy and pledged to investigate a tunnel collapse at a radioactive waste storage site in Washington state.

Perry has visited a shuttered nuclear waste dump at Nevada’s Yucca Mountain and cautiously began a yearslong process to revive it.

Asia trip

On Thursday, Perry embarked on a nine-day trip to Asia, where he planned to check on the progress made since a 2011 nuclear meltdown in Fukushima, Japan, and reaffirm the U.S. commitment to help decontaminate and decommission damaged nuclear reactors. Perry also was to represent the United States at a clean-energy meeting in Beijing.

The former Texas governor says he’s having the time of his life running an agency he once pledged to eliminate. Perry has emerged as a strong defender of the department’s work, especially the 17 national labs that conduct cutting-edge research on everything from national security to renewable energy.

“I’m telling you officially the coolest job I’ve ever had is being secretary of energy … and it’s because of these labs,” Perry, 67, told an audience last month at Idaho National Laboratory, one of several he has visited since taking office in March.

“If you work at a national lab … you are making a difference,” Perry said.

The energy chief soon will have a chance to back up those words when he and other officials head to Capitol Hill to defend a budget proposal that slashes funding for science, renewables and energy efficiency.

Paris accord

Perry probably will be asked to defend Trump’s decision to withdraw from the landmark Paris climate accord. Perry said Thursday that the U.S. remains committed to clean energy and that he was confident officials could “drive economic growth and protect the environment at the same time.”

The administration has called for cutting the Office of Science, which includes 10 national labs, by 17 percent. The proposed budget would reduce spending for renewable and nuclear energy, eliminate the popular Energy Star program to enhance efficiency and gut an agency that promotes research and development of advanced energy technologies.

Perry, who served 14 years as Texas governor, likened the spending plan to an opening offer that he expects to see significantly changed in Congress.

“I will remind you this is not my first rodeo when it comes to budgeting,” he said during a recent tour of the Oak Ridge National Laboratory in Tennessee. “Hopefully we will be able to make that argument to our friends in Congress — that what DOE is involved with plays a vital role, not only in the security of America but the economic well-being of the country as we go forward.”

Energy lobbyist Frank Maisano said Perry’s actions show instincts honed in his tenure as Texas’s longest-serving governor.

“He’s trying to find out what he needs to find out — hearing about these issues from the front lines,” Maisano said.

While Perry will never match the scientific expertise of his most recent predecessors at the Energy Department, nuclear physicists Steven Chu and Ernest Moniz, his political skills may offset that knowledge gap, Maisano said.

Renewable energy support

During his Oak Ridge visit, Perry pledged to be “a strong advocate” for Oak Ridge and other labs. He has spoken out in favor of renewable energy, such as wind and solar power, noting that while he was governor, Texas maintained its traditional role as a top driller for oil and natural gas while emerging as the leading producer of wind power in the United States and a top 10 provider of solar power.

Abigail Hopper, president and CEO of the Solar Energy Industries Association, said she had “a very positive conversation” with Perry at a meeting in April.

“He was very interested in our technology and how it can be utilized,” she said in an interview.

Perry also “knew exactly where Texas was in solar installation,” Hopper said — No. 9 in the nation, compared with its top ranking among wind-producing states.

Hopper, a former Interior Department official under President Barack Obama, said she and Perry did not discuss her federal service — but did talk about how national labs can boost the solar industry.

“It was good to make that connection between the research and how it translates into the marketplace,” she said. “He gets it.”
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Dozens of U.S. companies spoke out against President Trump’s decision to pull the United States out of the Paris climate accord. Analysts say the improving economic case for renewables has boosted support for green energy in the once-skeptical business community; but, as VOA’s Jim Randle reports, some coal companies supported the president’s action.
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The U.S. trade deficit rose in April to the highest level since January. The politically sensitive trade gap with China registered a sharp increase.

The Commerce Department said Friday that the U.S. trade gap in goods and services climbed 5.2 percent to $47.6 billion in April from March. Exports dropped 0.3 percent to $191 billion, pulled down by a drop in automotive exports. Imports rose 0.8 percent to $238.6 billion as Americans bought more foreign-made cellphones and other consumer goods.

So far this year, the trade deficit is up 13.4 percent from a year earlier to $186.6 billion. Exports are up 6.1 percent to $765.6 billion this year, but imports are up more _ 7.5 percent to $952.2 billion. So far in 2017, the United States is running a $268.7 billion deficit in goods and an $82.1 billion surplus in services such as banking and tourism.

The deficit in goods with China rose by 12.4 percent to $27.6 billion in April.

The Trump administration has vowed to reduce the trade deficit, blaming the gap between exports and imports on abusive practices by America’s trading partners.

President Donald Trump recently has singled out Germany for criticism, saying it is unfairly benefiting from a weak euro. When a country’s currency is weak, its products enjoy a price advantage in foreign markets. The trade deficit with Germany rose 4.3 percent in April to $5.5 billion.

 
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The price of oil has fallen sharply as investors bet that President Donald Trump’s decision to pull the United States out of the Paris climate agreement will increase the country’s oil and gas production.

The cost of a barrel of crude slumped 2.4 percent, or $1.18, to $47.18 in electronic trading in New York on Friday, hours after Trump said the U.S. would immediately stop implementing the Paris deal. He said his administration could try to renegotiate the existing agreement or try to create a new one that is more favorable to the U.S.

The deal would have required the U.S. to reduce polluting emissions by more than a quarter below 2005 levels by 2025, potentially limiting the growth of high-emissions industries like oil and gas production. Economists, however, say that the climate deal would likely help create about as many jobs in renewable energy as it might cost in polluting industries.

U.S. oil production has already been increasing in recent months since the price of crude came off lows last year, making expensive shale oil extraction more economically viable.

“Now that U.S. President Trump has announced that the U.S. will be withdrawing from the Paris Climate Agreement, it is expected that the U.S. will expand its oil production even more sharply,” said analysts at German bank Commerzbank.

The increase in U.S. production is neutralizing the efforts of the OPEC cartel and other major oil-producing nations, like Russia, to support prices by limiting their output. OPEC and 10 other countries led by Russia agreed last week to extend for nine months, to March, a production cut of 1.8 million barrels a day initially agreed on in November.

On Friday, the head of Russia’s state-controlled Rosneft oil giant said that that a rise in shale oil output in the U.S. would likely offset the effect from the OPEC and Russian production cuts.

Speaking at an economic forum in St.Petersburg, Rosneft CEO Igor Sechin said that the OPEC and Russian cuts fall short of “systemic measures that would lead to long term stabilization.”

He said that thanks to increasing efficiency, U.S. shale oil producers would likely deliver an additional 1.5 million barrels of crude a day to the market in 2018.
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The heated debate over India’s cash ban continues, with critics saying it slowed an economy that was growing, while the government says economic momentum was barely affected.

Critics say the scrapping of 86 percent of the country’s currency last November cost India its status as the world’s fastest growing economy.

According to data released this week, from January to March, growth plunged to 6.1 percent – lower than China’s 6.9 percent growth in the same period.

Overall growth for the last financial year, which began in April 2016 and ended in March 2017, however, stood at 7.1 percent.

Finance Minister Arun Jaitley has tried to distance the disappointing economic numbers from the currency ban, citing other factors.

“There was some slowdown visible, given the global and domestic situation, even prior to demonetization in the last year,” he told reporters.

The slowdown affected almost all sectors of the economy, with farming, manufacturing and services all taking a hit. With people scrambling to get access to new notes, consumption slowed sharply, impacting both small shopkeepers and large businesses.

The government, however, is encouraged by forecasts that the economy is expected to recover swiftly on the back of monsoon rains, which are expected to be plentiful, and a slew of major reform measures.

As economists estimated growth this year will rebound to 7.4 percent, the government pointed out that India’s economy is still among the world’s top performers. Jaitley said given the global scenario, “7 to 8 percent growth, which at the moment is the Indian normal, is fairly reasonable and by global standards very good.”

There are widespread expectations of a major economic boost from India’s most ambitious tax reform action since independence – the launch of a nationwide tax that will replace a plethora of levies starting July 1.

The World Bank said this week the reform would lower the cost of doing business for firms and reduce logistics costs.

In the coming year, “we actually have very strong fundamentals of the Indian economy, GDP growth being up, exports have revived and there has been continued reform momentum,” said Frederico Gil Sander, a senior economist at the World Bank in New Delhi.

And while demonetization undoubtedly left its imprint on India by slowing down the economy, the government is optimistic there will be long-term gains because the move would help clean up an economy where many businesses and professionals evade taxes, resulting in the generation of what is known as “black money.”

“The message has gone loud and clear and it continues to this day that it is no longer safe to deal in cash,” said Jaitley.

Skeptics say only improved tax collections in the coming years will demonstrate whether that is true, or whether tax evasion remains a challenge in a country where cash transactions are the norm in large sectors of the economy.
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U.S. Treasury Secretary Steven Mnuchin said on Thursday he was confident that Congress would raise the federal debt limit  “before there’s an issue” with U.S. creditworthiness, and he pledged that the Trump administration’s tax reform plans would be paid for.

“We’re going to get it increased,” Mnuchin told Fox Business Network about the debt limit. “The credit of the United States is the utmost. I’ve said to Congress they should do it as quickly as they can. But we are very focused on working with them and I’m confident we’ll get there before there’s an issue.”

Mnuchin said last week that he wanted a “clean” debt ceiling increase before the start of Congress’ summer recess in early August.

Mnuchin said that it “makes no sense” to view the Trump administration’s tax reform plans through a “static” budget analysis that does not account for economic growth effects. He has previously pledged that increased economic growth would generate more revenue to offset lower tax rates.

“We’re about creating economic growth, we’re about broadening the base and we’re going to make sure that this is tax reform, not just tax cuts, and that they’re paid for,” Mnuchin said.
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President Donald Trump is moving the United States out of the Paris climate agreement, signed by nearly 200 other nations.

Trump said Thursday that the Paris agreement hurts U.S. economic growth, costs millions of American jobs and puts U.S. firms at a disadvantage. However, his decision contrasted with the views of hundreds of American business leaders who urged him to continue participating in the climate agreement.

While the president said Washington would stop implementing the Paris accord immediately, he added that he would begin negotiations aimed at rejoining the Paris accord or a similar agreement on terms more advantageous to the United States.  

“We will see if we can make a deal that’s fair,” Trump said. An audience at the White House Rose Garden warmly applauded his announcement.

Among the many corporations that opposed the move to bow out of the Paris Agreement were Mars, Nike, Levi Strauss and Starbucks. Their top corporate officers signed a letter to Trump several months ago, arguing that failing to build a low-carbon economy would put U.S. “prosperity at risk.”

WATCH: Trump: US ‘Will Cease All Implementation’ of Paris Climate Accord

Trump: ‘Fortune’ at stake

Trump said the climate agreement, as presently written, would cost U.S. businesses “a vast fortune” and lead to the loss of 7 million jobs by 2025.

Tesla founder Elon Musk tried to persuade the president to stay in the accord and said Wednesday that he would quit the White House business advisory council if Washington left the Paris Agreement.

GE chief Jeff Immelt has written that customers, partners and countries are demanding technology that generates electric power while improving energy efficiency and cutting costs.

Oil companies like Chevron and ExxonMobil recently argued that the Paris Agreement gives their firms a more predictable future, and therefore more manageable one. The oil companies and some coal firms also say remaining part of the accord helps maintain U.S. influence over future talks.  

Earlier this week, more than 60 percent of Exxon shareholders voted to require that the firm do more analysis and disclosure of the likely impact of tougher climate policies on company revenue. Previous efforts to force such disclosures failed to get a majority of votes from shareholders.  

Some other business, Republican and conservative groups agreed with Trump’s action. The Heritage Foundation, for example, said the accord produces “devastating” economic costs and “zero” environmental benefits.
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When General Motors CEO Mary Barra introduced the Chevrolet Bolt at the CES gadget show last year, she took a shot at Tesla.

Buyers can be confident because Chevy has 3,000 U.S. dealers to service the new electric vehicle, she said. The implication was that Tesla, with just 69 service centers nationwide, can make no such promise.

The uncharacteristic insult from Barra was designed to highlight the difference between 108-year-old GM and Tesla, a disruptive teenager. It also acknowledged a budding rivalry that could help determine whether Detroit or Silicon Valley sets the course for the future of the auto industry.

The tale of the tape favors GM. It has made billions in profits since returning to the public markets in 2010. GM got the Bolt, a $36,000 car that goes 238 miles per charge, to market before Tesla’s Model 3. Tesla, the 14-year-old company led by flamboyant CEO Elon Musk, has never posted an annual profit.

Yet, as both CEOs face shareholders for annual meetings Tuesday, it is Barra who must explain to skeptical investors why GM’s future is as bright as Tesla’s.

GM’s stock is trading around the $33 price of its initial public offering seven years ago. During that time, Tesla shares have soared more than tenfold to $335. Wall Street now values Tesla at about $55 billion, compared to around $50 billion for GM.

Despite efforts to paint themselves as technology companies, automakers can’t shake their giant, capital-intensive global manufacturing operations. The huge investment needed to build vehicles yields low profit margins compared with tech companies that make software or cell phones, says Michael Ramsey, an analyst with Gartner. GM’s net profit margin in 2016 was 5.7 percent. By comparison, Alphabet Inc., parent of Google, had a 22 percent margin.

Although it’s an automaker, Tesla started in the tech bucket and remains there in the eyes of investors and buyers, Ramsey says.

Tesla’s electric cars are the envy of the industry, and its semi-autonomous technology is among the most advanced on the road. Musk says Tesla’s California assembly plant – which used to be GM’s – will soon be among the most efficient in the world. And it’s branching into areas with potential for bigger returns, including solar panels, energy storage and trucking.

Tesla is absurdly overvalued if based on the past, but that’s irrelevant. A stock price represents risk-adjusted future cash flows,” Musk tweeted in April.

Still, Musk can’t risk any missteps as Tesla pivots from a niche manufacturer of 84,000 high-priced cars per year. The Model 3 sedan, Tesla’s first mainstream car, is due out later this year, but previous launches have been plagued with delays. Tesla has yet to prove it can build high-volume vehicles with quality and reliability, as GM does. Musk aims to make 500,000 vehicles per year in 2018; GM made more than 10 million cars and trucks last year.

GM, too, is stretching into new areas. Its Maven car-sharing service has 35,000 members in 17 North American cities, and it’s providing cars for ride-hailing services. GM is developing autonomous cars with Cruise Automation, a software company purchased last year. Its SuperCruise semi-autonomous driving system, due out this year, is designed to be safer than Tesla’s.

And GM isn’t the only automaker with a stagnant stock price. Of the seven best-selling carmakers in the U.S., only Toyota and Fiat Chrysler have seen significant growth in seven years. Ford, Honda and Hyundai all have lost value.

“Investors and the financial markets are much more interested in investing in the potential of what might be huge than in the reality of what’s already profitable and likely to remain so for years to come,” says Sam Abuelsamid, a senior analyst with Navigant Research.

Abuelsamid says GM could better trumpet its technology achievements. For instance, it scarcely markets the Bolt. By contrast, Musk builds hype with nightclub-like events for Tesla owners and Twitter banter with 8.8 million followers.

“The only way you can get people to perceive you in the same light as a company like Tesla is to demonstrate it,” Abuelsamid says.

Musk is crucial to Tesla’s success. The risk-taking billionaire founded PayPal and rocket company SpaceX before taking over Tesla. He espouses big ideas like Hyperloop high-speed transportation and colonizing Mars.

Barra, on the other hand, is a methodical engineer who rarely strays from script. She has only 29,500 Twitter followers. She’s a GM lifer who earned a company-paid MBA from Stanford; Musk left a Stanford graduate physics program after just two days to form a publishing startup.

“Mary is like a normal high-level performing executive,” Ramsey says. “Elon Musk is like an almost unrivaled superstar, even in comparison to Silicon Valley executives.”

Still, the big changes in the auto industry are in the early stages. Electric vehicles make up less than 1 percent of global auto sales and fully self-driving cars are years away. The economy can falter and company fortunes can shift. Already this year, sales in the U.S. and China are slowing, and GM pulled out of the European and Indian markets because they weren’t profitable.

GM knows the ups and downs of auto sales, but Tesla will have to learn to manage them. If the Model 3 is late and Tesla sales fall, its stock price could drop and reduce Tesla’s access to cheap capital, Ramsey says.

“I don’t think they’re completely immune to economic cycles,” he says. “That will be when we really know if Tesla can maintain this out-of-whack share value with their fundamentals.”
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Canada’s defense minister repeated a threat Wednesday to cancel the purchase of 18 fighter jets from Boeing Co. because of the company’s trade complaint against Canadian plane maker Bombardier.

Harjit Sajjan said Boeing’s action against Bombardier is “unfounded” and not the behavior of a “trusted partner.” He said buying the Super Hornet fighter jets “requires a trusted industry partner.”

Sajjan urged Boeing to withdraw the complaint. Canada’s foreign minister has also threatened to block the order.

“Our government — and I stress this — our government is disappointed in the action of one of our leading industry partners,” he said. 

Complaint could mean duties

Chicago-based Boeing’s trade complaint prompted a U.S. Commerce Department anti-dumping investigation that could result in duties being imposed on Bombardier’s new larger C Series passenger aircraft. Boeing insists the plane receives Canadian government subsidies that give it an advantage internationally.

Canada’s threat is coming amid increasing trade disputes with the U.S. 

Scott Day, a spokesman for Boeing, noted that Sajjan also recognized Boeing as a strong partner in the past and for the future. Day defended the company’s trade action. 

“This is a commercial matter that Boeing is seeking to address through the normal course for resolving such issues,” Day said in an email. 

Boeing petitioned the U.S. Commerce Department and the U.S. International Trade Commission to investigate subsidies of Montreal-based Bombardier’s C Series aircraft. Boeing says Bombardier has received more than US $3 billion in government subsidies that let it engage in “predatory pricing.”

Brazil has also launched a formal complaint to the World Trade Organization over Canadian subsidies to Bombardier. Sao Paolo-based Embraer is a fierce rival of Bombardier.

Government investment

The Quebec government invested US $1 billion in exchange for a 49.5 percent stake in the C Series last year. Canada’s federal government also recently provided a US $275 million loan to Bombardier, which struggled to win orders for its new medium-size plane. But Bombardier won a 75-plane order for the C Series from U.S.-based Delta Air Lines in 2016. Bombardier said its planes never competed with Boeing in the sale to Delta.

The Canadian government said late last year it would enter into discussions on buying 18 Super Hornet jet fighters from Boeing on an interim basis and hold an open competition to buy more planes over the next five years. Canada remains part of Lockheed Martin’s F-35 Joint Strike Fighter program. 

 
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Major investors put U.S. industry on notice Wednesday that climate change matters, even as reports emerged that President Donald Trump plans to withdraw the United States from an international pact to fight global warming.

A number of large institutional fund firms including BlackRock, the world’s largest asset manager, supported a shareholder resolution calling on ExxonMobil to share more information about how new technologies and climate change regulations could impact the business of the world’s largest publicly traded oil company. The proposal won the support of 62.3 percent of votes cast.

The victory, on such a wide margin, was hailed by climate activists as a turning point in their decades-long campaign to get oil and gas companies to communicate how they would adapt to a low-carbon economy.

Major investors see major risk

With major investors now seeing climate change as a major risk, activists said U.S. corporations will have to be more transparent about the impact of a warming planet even if the United States withdraws from the 2015 Paris climate accord, as Trump promised during his presidential campaign.

“Economic forces are outrunning any other considerations,” said Anne Simpson, investment director for sustainability at the California Public Employees’ Retirement System, one of the sponsors of the resolution.

She credited big investors in Exxon for the change, since at least some of them switched their votes after last year when a similar measure won just 38 percent support.

“We have seen a sea change in their viewpoint,” she said.

Many top investors now consider their votes on shareholder proposals “on merit, rather than considering it a test of loyalty to management,” she said.

Among Exxon’s top investors, Vanguard Group and BlackRock opposed last year’s call for climate change reporting. A spokeswoman for Vanguard, which has about 7 percent of Exxon’s shares, declined to comment on its voting this year.

A person familiar with the matter said funds run by BlackRock, which holds about 6 percent of Exxon shares, voted in favor of the climate resolution.

Filings showing their exact votes are not due for months.

But both fund firms and others have taken steps since last year to make it easier to support climate resolutions.

Doug Holt, a spokesman for Exxon’s ninth-largest investor Northern Trust Corp, said it voted in favor of the proposal, citing its own guidelines updated in 2016.

Vote from the street

The investment firms’ approach reflects a new interest in climate matters among their own investors, who have stuffed money into so-called green mutual funds and other vehicles that use environmental factors in their stock picking.

Wall Street’s priorities have shifted the terms of debate at a number of other energy and utility companies. A majority of shareholders voting at Occidental Petroleum Corp and PPL Corp called for similar reports on the risks of climate change. Votes on two more of the measures are scheduled for June 7 at Devon Energy and at Hess.

Michael Crosby, involved in corporate outreach for the Midwest Capuchin Franciscans, a religious order, said Wednesday’s vote was a rejection of Exxon’s arguments it already provides enough detail on its outlook.

“The Street is saying, you have to give better evidence,” Crosby said.

Exxon and the Paris deal

After the measure passed, Exxon Chief Executive Officer Darren Woods said its board would reconsider its climate communications.

The activists now face the task of maintaining alliances with leaders like Woods who opposed their resolutions but who in some cases support the 195-nation Paris agreement. Exxon said in a March 22 letter to the White House that the Paris deal is “an effective framework for addressing the risks of climate change.”

Trump had at least one ally at Exxon’s meeting in Dallas, Steven Milloy of Potomac, Maryland, who urged other investors to support his resolution that would make it harder to file proposals like the one on climate change.

Milloy said management should show less concern for climate issues, which he called misplaced, and cited Trump as a model.

“For the first time we have a president who actively opposes climate hysteria,” Milloy said.

According to Exxon, Milloy’s proposal received support from 1.6 percent of votes cast.
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The head of a New York-based advocacy group has called on President Donald Trump and his older daughter to help secure the release of three men who reported labor violations at a Chinese company that makes shoes bearing the Ivanka Trump brand.

“We appeal to President Trump, Ivanka Trump herself, and to her related brand company to advocate and press for the release of our activists,” Li Qiang, executive director of China Labor Watch, the men’s employer, said Wednesday.

The Ivanka Trump brand has declined to comment.  The White House and Ivanka Trump’s lawyer did not immediately respond to requests for comment.  Calls to provincial police in China were not answered. Chinese Foreign Ministry spokeswoman Hua Chunying said she was unaware of the situation and declined to make further comments.

Hua Haifeng and two other labor activists, Li Zhao and Su Heng, had been covertly investigating labor conditions at two Chinese factories that make shoes for Trump and other brands, in the cities of Ganzhou and Dongguan. They disclosed preliminary findings to China Labor Watch, indicating workers at the factories had been subject to extremely long hours.

Hua was arrested in Jiangxi province on suspicion of illegally using eavesdropping equipment; he and the other two men disappeared Saturday and were last seen in Ganzhou, in southern Jiangxi province, China Labor Watch reported Tuesday.

The arrest and disappearances came amid Chinese President Xi Jinping’s crackdown on the country’s advocacy groups and civil society. In the past year, dozens of human rights activists have been detained in China.

The global human rights group Amnesty International called for the release of the three men if they are being held only for investigating possible labor abuses at the factories, which are owned by Huajian International.

“Activists exposing potential human rights abuses deserve protection, not persecution,” said Amnesty International spokesman William Nee. “The trio appear to be the latest to fall foul of the Chinese authorities’ aggressive campaign against human rights activists who have any ties to overseas organizations, using the pretense of ‘national security.’ ”

The relationship between the Trump family and China has received widespread attention since last year’s presidential campaign.  While Trump has accused China of taking coveted manufacturing jobs from the U.S., the Trump family has sought to benefit financially from the Chinese market.

Trump recently obtained more than 75 trademarks in China. The family of Jared Kushner, Ivanka Trump’s husband, is attempting to raise money from Chinese investors for a real estate venture.
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Vietnamese Prime Minister Nguyen Xuan Phuc said Tuesday that he would sign deals for U.S. goods and services worth $15 billion to $17 billion during his visit to Washington, mainly for high-technology products and for services.

“Vietnam will increase the import of high technologies and services from the United States, and on the occasion of this visit, many important deals will be made,” Phuc told a U.S. Chamber of Commerce dinner.

Phuc, who is due to meet with U.S. President Donald Trump on Wednesday at the end of a three-day visit to the United States, did not provide further details of the transactions.

GE Power Chief Executive Officer Steve Bolze told the dinner that General Electric Co. would sign deals worth about $6 billion with Vietnam, but also offered no details.

Phuc’s comments came after U.S. Trade Representative Robert Lighthizer expressed concern about the rapid growth of the U.S. trade deficit with Vietnam, saying this was a new challenge for the two countries and that he was looking to Phuc to help address it.

“Over the last decade, our bilateral trade deficit has risen from about $7 billion to nearly $32 billion,” Lighthizer said. “This concerning growth in our trade deficit presents new challenges and shows us that there is considerable potential to improve further our important trade relationship.”

Reducing deficits

Lighthizer and other Trump administration trade officials have pledged to work to reduce U.S. bilateral deficits with major trading partners. The $32 billion deficit with Vietnam last year — the sixth-largest U.S. trade deficit — reflects growing imports of Vietnamese semiconductors and other electronics products in addition to more traditional sectors such as footwear, apparel and furniture.

The trade issue has become a potential irritant in a relationship where Washington and Hanoi have stepped up security cooperation in recent years, given shared concerns about China’s increasingly assertive behavior in East Asia.

Phuc’s meeting with Trump makes him the first Southeast Asian leader to visit the White House under the new administration.

It reflected calls, letters, diplomatic contacts and lower-level visits that started long before Trump took office in Washington, where Vietnam retains a lobbyist at $30,000 a month.

Vietnam was disappointed when Trump ditched the 12-nation Trans-Pacific Partnership (TPP) trade pact, in which Hanoi was expected to be one of the main beneficiaries, and focused U.S. trade policy on reducing deficits.
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Mexico’s foreign minister says the country is “inevitably” set to review rules of origin when renegotiating the North American Free Trade Agreement, giving a boost to President Donald Trump’s manufacturing push.

Foreign Relations Secretary Luis Videgaray said Tuesday at an event in Miami that NAFTA has allowed Mexican industry to enter the U.S. market with lax rules of origin. The rules dictate how much U.S. content a product assembled in Mexico must have in order to escape tariffs when being imported into the United States. Currently set at 62.5 percent for the auto industry, that number could increase.

“One part that must inevitably be reviewed is the chapter on rules of origin,” Videgaray said at the University of Miami. “Over time, the free trade agreement has sometimes been used — not always, of course, but sometimes — as a way to access the U.S. market perhaps with laxity in some ways of rules of origin.”

The Trump administration told Congress this month there would be 90 days of consultations on the renegotiation of the 23-year-old pact before beginning talks with Canada and Mexico. Annual trade of goods between Mexico and the U.S. was worth $525 billion in 2016, with the U.S. running a trade deficit of more than $63 billion.

The foreign minister said Mexico won’t entertain any talks on building a wall along the border. Videgaray maintained it is seen as an unfriendly sign and questioned its efficiency. Trump’s budget seeks $2.6 billion for border security technology, including money to design and build a wall along the southern border. Trump repeatedly promised voters during the campaign that Mexico would pay for a wall.
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A group of Senate Democrats sent a letter to U.S. President Donald Trump on Tuesday, requesting information about a raft of trademark approvals from China this year that they say may violate the U.S. Constitution’s ban on gifts from foreign governments.

“China’s rapid approvals after years of court battles have raised questions as to whether the trademarks will prevent you from standing up to China on behalf of American workers and their businesses,” the eight senators, led by Michigan Democrat Debbie Stabenow and Connecticut Democrat Richard Blumenthal, wrote.

China’s most recent nod for a Trump trademark, covering clothing, came on May 6, bringing to 40 the number of marks China has granted or provisionally granted to the president and a related company, DTTM Operations LLC, since his inauguration. If there are no objections, provisional approvals are formally registered after 90 days. China has also rejected or partially rejected nine Trump trademarks since the inauguration.

Trademarks give the holder monopoly rights to a brand in a given market. In many jurisdictions, like China, they can also be filed defensively, to prevent squatters from using a name. Because trademarks are granted at the discretion of foreign governments and can be enormously valuable, they can be problematic for U.S. officials, who are barred by the emoluments clause of the constitution from accepting anything of value from foreign states without congressional approval.

In their letter, the senators were particularly interested in any special efforts Trump, his Chinese lawyers, or the U.S. Embassy in China, which sometimes advocates for U.S. firms, may have made to secure approval for the president’s trademarks. They cited an Associated Press report quoting one of Trump’s lawyers in China, Spring Chang, who said that “government relations are an important part of trademark strategy in China.”

Concern about favoritism is particularly sharp in China, where the courts and bureaucracy are designed to reflect the will of the ruling Communist Party. China has defended its handling of Trump’s intellectual property interests, saying it followed the law in processing his applications, though some trademark lawyers viewed the pace as unusually quick and well-coordinated. In addition, China approved one trademark for Trump-branded construction services after a 10-year legal battle that turned in his favor only after he declared his candidacy.

Alan Garten, chief legal officer of The Trump Organization, did not respond immediately to a request for comment. He has previously said that Trump’s trademark activity in China predates his election and noted that Trump has stepped away from managing his company. However, the president retains an ownership stake in his global branding and real estate empire.

In April, Citizens for Responsibility and Ethics in Washington, a watchdog group, added “gratuitous Chinese trademarks” to its lawsuit against the president for alleged emoluments violations. Trump has dismissed the suit as without merit.
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Cross-border fighting between Afghanistan and Pakistan has suspended trade worth millions of dollars and stranded hundreds of trucks loaded with fruits and vegetables at the border, where the produce stands to spoil in the rising heat.

Pakistan had temporarily closed the Chaman border crossing, across from Afghanistan’s Spinboldak, after a frontier skirmish earlier this month between Afghan and Pakistani border guards left more than 10 people dead. Global economic institutions say South Asia is one of the world’s least economically connected regions, and the periodic closures of border crossings complicate things further.

Summer is peak time for fruit and vegetable production in the two countries. Under normal circumstances around this time of the year, a significant portion of Afghanistan’s grapes and pomegranates is ferried overland to Pakistan.

Pakistan’s mangoes and vegetables go the opposite direction, along with bilateral trade in many other commodities — some legal and some otherwise.

Part of the Afghan fruit produce is sold in Chaman and nearby villages; the remainder finds its way to markets across Pakistan.

It’s a long-established system that relies heavily on trust: Pakistani fruit traders send advance payments to their Afghan counterparts, who then send the fruit after it’s harvested. But so far this year, the Chaman businessmen say they have not cut the usual deals because the border closure have created the risk of coming up empty-handed.

Amant Khan, a fruit trader in Chaman, said he suffered losses last year as tensions rose between the two countries.

“This season we did not give the grape or melon dealers anything,” he said. “In fact, we decided not to do business with Afghanistan.”

For traders in Waish Mandi, a thriving Afghan market town across from Chaman, these are hard financial times, too. Hundreds of people, who used to benefit from border trade, have lost work. Unable to move their merchandise across the border, goods worth millions of dollars are stranded in truck containers.

Apart from the fruit trade, bilateral trade between Afghanistan and Pakistanonce worth $3 billion a year has dropped to $1.2 billion, said Khan Jan Alkozai, president of the Afghanistan Chamber of Commerce and Industry.

Pakistan’s own fruit exports to Central Asia via Afghanistan, which usually average 2 million pounds, also suffer because of border closures, Alkozai said.

Daro Khan, former vice president for the Afghanistan-Pakistan Joint Chamber of Commerce, said Pakistani farmers and businessman have not recovered from losses due to border closures last year.
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A new ban imposed by India’s government on the sale of cows and buffaloes for slaughter to protect animals considered holy by many Hindus is drawing widespread protests from state governments and animal-related industries.

Many state governments criticized the ban as a blow to beef and leather exports that will leave hundreds of thousands jobless and deprive millions of Christians, Muslims and poor Hindus of a cheap source of protein.

The rules, which took effect Friday, require that cattle traders pledge that any cows or buffalos sold are not intended for slaughter.

At least one state government is planning a challenge in court. Some have said the ban infringes on states’ commercial autonomy and are calling for a nationwide protest.

Others say the ban will hurt farmers who will be forced to continue feeding aged animals, and that millions of unproductive cattle will be turned out on the streets.

The new rules also propose the setting up of a vast animal monitoring bureaucracy, including animal inspectors and veterinarians, to ensure the rules are followed. Traditionally, cattle fairs and markets allow the sale of animals headed to abattoirs to provide raw materials used in dozens of industries, including leather making, soap and fertilizer.

The state governments have appealed to Prime Minister Narendra Modi to repeal the order, which they say was issued without consultations with them. Modi’s Bharatiya Janata Party has been pushing a Hindu nationalist agenda since it came to power in 2014.

Chief Minister Pinarayi Vijayan, the top elected official in southern Kerala state, wrote to Modi on Sunday describing the restrictions as a “drastic move” that would have “far-reaching consequences and would be detrimental to democracy.”

He said the move amounts to “an intrusion into the rights of the states” in India’s federal structure and violates the principles of the Indian Constitution.

The government of West Bengal state also protested the move, saying the Modi government cannot make such decisions unilaterally.

Chief Minister Mamata Banerjee said the state would not accept the imposition of such restrictions on its commercial authority. She described it as a step by the Modi government to “destroy the federal structure of the country.”

“We won’t accept the decision. It is unconstitutional. We will challenge it legally,” Banerjee told reporters Monday.

Hindus, who form 80 percent of India’s 1.3 billion people, consider cows to be sacred, and for many eating beef is taboo. In many Indian states, the slaughtering of cows and selling of beef is either restricted or banned. India has the highest number of vegetarians in the world as a result of Hinduism’s predominance, although not all Hindus are vegetarians.

While the eating of beef is not a crime in many states, slaughtering a cow carries a punishment of up to seven years in jail throughout the country. In Gujarat state, lawmakers have approved a bill increasing the punishment for killing a cow to life imprisonment.

Critics say the new rules, ostensibly to protect the way animals are treated and transported, are in keeping with demands of Hindu nationalists, who have long been pressing for a nationwide ban on the sale of beef. The past two years have also seen a rise in vigilante attacks on Muslims and lower caste Hindus involved in the cattle trade. Several deaths have occurred.

On Monday, police arrested seven people on suspicion of assaulting two Muslim men who were transporting meat in western Maharashtra state. The men were beaten and forced to chant Hindu slogans by a vigilante group on Sunday, police said.

Meanwhile, leather and meat industry groups said the ban could push them out of business.

Fauzan Alavi of the All India Meat and Livestock Exporters Association said beef exports, which had been growing rapidly, have already been affected. “Such a drastic move is bound to hit the industry,” Alavi said Sunday.

The government “has handed a death certificate to us,” said Ramesh K. Juneja of the Council of Leather Exports.

 
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British Airways passengers continue to face delays, cancellations, and overcrowding Sunday at Heathrow Airport as the airline reels from a computer failure.

The airline said that all long-haul flights will continue Sunday, but to avoid further overcrowding, passengers will only be allowed to enter the airport terminal 90 minutes before their scheduled departure.

Passengers should still expect delays and cancelations for shorter flights, British Airways chief executive Alex Cruz said, adding that the airline was at “near-full operation” Sunday.

“I know this has been a horrible time for customers,” Cruz said, apologizing in a video statement posted online.

 
The airline was forced to cancel flights Saturday at Heathrow and Gatwick airports as officials tried to fix a global computer failure.

British Airways has not said what caused the glitch, but did report there is no evidence pointing to a cyber attack.

The failure occurred on a particularly busy weekend in Britain, where a public holiday will be observed on Monday and when many children are starting their mid-term school breaks — prompting some stranded travelers to express their frustration on Twitter.

British Airways has experienced other recent computer glitches. Passengers were hit with severe delays in July and September last year because of problems with the airline’s online check-in systems.

 
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Saffron has long been one of the world’s most expensive spices. The saffron crocus that produces the spice grows mostly in parts of Europe, Iran and India. Now, a U.S. company seeking to “cultivate peace” is attracting attention to this historic spice and trying to develop new markets for saffron grown in Afghanistan. VOA’s Kane Farabaugh has more from Chicago.
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U.S. President Donald Trump has told “confidants,” including the head of the Environmental Protection Agency, Scott Pruitt, that he plans to leave a landmark international agreement on climate change, the Axios news website reported Saturday, citing three sources with direct knowledge.

On Saturday, Trump said in a Twitter post he would decide whether to support the Paris climate deal next week.

The White House did not immediately respond to a request for comment.

A source who has been in contact with people involved in the decision told Reuters that a couple of meetings were planned with chief executives of energy companies and big corporations and others about the climate agreement ahead of Trump’s expected announcement later in the week. It was unclear whether those meetings would still take place.

“I will make my final decision on the Paris Accord next week!” Trump tweeted on the final day of a Group of Seven (G-7) summit in Italy at which he refused to bow to pressure from allies to back the 2015 agreement.

Six against one

The summit of G-7 wealthy nations pitted Trump against the leaders of Germany, France, Britain, Italy, Canada and Japan on several issues, with European diplomats frustrated at having to revisit questions they had hoped were long settled.

Trump, who has previously called global warming a hoax, came under concerted pressure from the other leaders to honor the 2015 Paris Agreement on curbing carbon emissions.

Although he tweeted that he would make a decision next week, his apparent reluctance to embrace the first legally binding global climate deal, signed by 195 countries, clearly annoyed German Chancellor Angela Merkel.

“The entire discussion about climate was very difficult, if not to say very dissatisfying,” she told reporters. “There are no indications whether the United States will stay in the Paris Agreement or not.”
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Bitcoin, the controversial digital currency, recently made headlines for reaching a record high valuation of more than $2,700, but perhaps the bigger growth potential lies in blockchain. The technology behind bitcoin and similar cryptocurrencies is being explored by more conventional companies and businesses. VOA’s Tina Trinh reports from New York.
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The U.S. economy expanded at a slightly faster pace than first estimated during the first quarter of this year.

The Commerce Department’s Friday report shows expansion at a 1.2 percent annual rate in January, February and March. That is nearly twice as fast as the preliminary estimate, but slower than the end of last year, and much more slowly than the 3 percent rate of expansion that the Trump administration says it will achieve.

Officials routinely revise growth estimates as more complete data becomes available.

Many experts say the economy is growing slowly because aging baby boomers are leaving the work force to retire, and productivity growth has been disappointingly slow.

The chief economist of PNC Bank, Gus Faucher, says growth is “bouncing back” in the second quarter. Faucher says he expects the U.S. economic growth will bounce around somewhat and expand at a 2.3 percent rate this year. Faucher also expects the growth rate to be about the same next year. 

A separate report shows new orders for manufactured goods declined in April. The seven-tenths of a percent decrease followed several months of gains.
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Africa loses an estimated $50 billion a year to illicit financial flows, leaving governments strapped for cash and dependent on development aid.

The continent is “hemorrhaging” money because of the failure of countries to enact strong legislation to check money flows, says Rose Acha, Cameroon’s supreme state audit minister and secretary general of the African Organization of Supreme Audit Institutions.

Instead, uncontrolled transactions are common.

“Whatever the source of your money, we don’t know, but we welcome those who want to deposit money,” said Faison Winifred of Investment Fund, a local financial institution in Cameroon’s capital, Yaounde. “Why … do you discourage the person by asking where is your source of income? We encourage everybody who comes to deposit money. … There is no limit. Whatever amount you want to deposit, we like it.”

Acha says smuggling and trafficking during illegal commercial activity constitute 65 percent of Africa’s financial hemorrhage, while criminal activities — which consist of using funds for illegal purposes, like financing organized crime and terrorism — come next with 30 percent. She says corruption and tax evasion account for the remaining 5 percent of the money lost.

According to the United Nations High Level Panel on Illicit Financial Flows, Africa loses a staggering $50 billion annually. The panel says that is approximately double the amount of official development assistance Africa receives.

African tax and audit experts, meeting this week in Yaounde, said the worst offender is Nigeria, with an illicit outflow of $157 billion from 2003 to 2012. South Africa ranks second with $122 billion lost during that time period, and Egypt third with $37 billion.

Magagi Tanko of the supreme state audit office of Niger says that in Central and West Africa, huge sums of money are transferred illegally and public coffers are impoverished. In addition, illegal financial flows from drug trafficking have spiraled.

Exporters use under-invoicing so they can dodge taxes and bring in less foreign exchange, leaving the rest of their earnings in offshore accounts, he says.

Lagan Wort, executive secretary of the African Tax Administration, says a regional approach is key.

“Parts of the defense mechanism that African governments must employ is to build strong tax legislation and tax policy systems, including tax agreements between countries, especially inter-African countries,” Wort said.

The experts resolved to work with the Stolen Assets Recovery Initiative — a joint effort by the World Bank and U.N. Office on Drugs and Crime — to recover funds, but said the process is long and cumbersome, since many banks remain secretive about their transactions.

They said many of the illicit financial flows also end up funneled through complex criminal rings, severely limiting the ability of law enforcement and tax authorities to trace offenders and eventually recover the money.
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A budget proposal by the Trump administration in March outlines a commitment to the National Aeronautics and Space Administration’s (NASA) effort to send astronauts to Mars. About $3.7 billion is earmarked for development of the Space Launch System and the Orion capsule, crucial parts of NASA’s effort to send humans deeper into space. VOA’s Kane Farabaugh explores the effort of contractors working on the project, united by the commitment to “boldly go” further into the final frontier.
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