Cindy Saine at the State Department contributed to this report. 

 

U.S. President Donald Trump said late Friday that the United States and Mexico had reached a deal on migration to avert tariffs.

“I am pleased to inform you that The United States of America has reached a signed agreement with Mexico. The Tariffs scheduled to be implemented by the U.S. on Monday, against Mexico, are hereby indefinitely suspended,” he tweeted.

“Mexico, in turn, has agreed to take strong measures to stem the tide of Migration through Mexico, and to our Southern Border. This is being done to greatly reduce, or eliminate, Illegal Immigration coming from Mexico and into the United States,” Trump said.

Earlier Friday, Trump had tweeted that there was a “good chance” the two sides would reach a deal to avert tariffs over the surge of migrants across the U.S. border. However, he added, “If we are unable to make the deal, Mexico will begin paying Tariffs at the 5% level on Monday!”  

U.S. and Mexican officials returned to the negotiating table Friday for a third day of talks to find a way to stem the migrant flow.

Effect on hiring?

Trump’s trade wars with Mexico and other countries appeared to have spooked American companies into putting the brakes on hiring. They added just 75,000 jobs in May, far fewer than the 180,000 economists expected, the Labor Department reported Friday.  

 

Although the jobless rate held steady at a 50-year low of 3.6%, Friday’s figures were the latest signal that the U.S. economy, while healthy, is weakening. Manufacturers, which are particularly sensitive to trade disputes, added only 3,000 jobs, extending an anemic streak of hiring in the sector.

U.S. and Mexican officials discussed a deal calling for Mexico to sharply increase patrols of its border with Guatemala to curb migration, The Washington Post reported, with the deployment of 6,000 National Guard troops. The newspaper said Mexico and the U.S. could overhaul asylum rules throughout the region, requiring Central Americans to first seek refuge in Mexico rather than traveling through it to reach the U.S. 

 

With such a plan in place, the United States could send Guatemala asylum seekers to Mexico, and those from Honduras and El Salvador to Guatemala.  

Earlier Friday in Mexico City, President Andres Manuel Lopez Obrador reiterated his own optimistic position. 

Causes of ‘chaos’

 

“There is dialogue and an agreement can be reached,” Lopez Obrador said. “I’m optimistic we can achieve that.” He added it was a mistake, though, for the U.S. to link migration with trade, saying again that migration must be addressed by solving social and economic problems in Central America.

“The causes of the migratory chaos aren’t being analyzed, only the effects,” he said.  

U.S. authorities have said more than 100,000 undocumented migrants, mostly from the three Central American countries, have crossed into the United States in recent months. The U.S. government announced Wednesday that in May, 144,000 migrants were detained at the border, up 32% from April. It was the highest monthly figure in 13 years. 

 

Some Republican lawmakers, normally close political allies of Trump, had said they would try to block any potential tariffs with legislation, which would have drawn wide support from opposition Democrats. Numerous lawmakers feared rising consumer costs for Americans if the tariffs were imposed on Mexican goods, including cars and numerous food products exported to the U.S.
…

your ads here!

Uber is parting ways with two of its top executives less than a month after the company’s rocky stock market debut.

CEO Dara Khosrowshahi told employees in an email Friday that he plans to be more involved in day-to-day operations now that the initial public offering of stock has passed. He said the heads of the company’s global rides and food-delivery teams will report directly to him, and Chief Operating Officer Barney Harford will leave the company.

Khosrowshahi said he plans to combine the marketing, communications and policy teams, and Chief Marketing Officer Rebecca Messina also will leave the company.

“It’s increasingly clear that it’s crucial for us to have a consistent, unified narrative to consumers, partners, the press and policymakers,” Khosrowshahi said.

Stock struggling

San Francisco-based Uber’s stock has struggled since its initial public offering last month. The company posted strong revenue growth in its first quarter as a public company, but also $1 billion in losses.

The stock closed Friday down 76 cents, or 1.7%, at $44.16. It went public at $45 a share.

“This is Dara asserting more control over the company and taking over the wheels at a time the company really needs to execute in the eyes of the public investors,” said Dan Ives, managing director of equity research at Wedbush Securities. “It’s a double-edged sword for him, because it’s going to put that much more pressure on the success of Uber riding on his shoulders.”
…

your ads here!

Two key U.S. legislators want answers from Boeing and federal regulators about why the company waited more than a year to disclose that a safety alert in its 737 Max plane wasn’t working properly. 

 

U.S. Reps. Peter DeFazio of Oregon and Rick Larsen of Washington sent letters to Boeing and the Federal Aviation Administration seeking details on what they knew when, and when airlines were told. 

 

The feature is designed to warn pilots when a sensor provides incorrect information about the pitch of the plane’s nose. 

 

Boeing admitted in May that within months of the plane’s 2017 debut, engineers realized that the sensor warning light worked only when paired with a separate, optional feature. 

 

The sensors malfunctioned during flights in Indonesia and Ethiopia. Both planes crashed, killing 346 people in all.
…

your ads here!

Finance ministers and central bank governors meeting in Japan this weekend will try to make headway on long-standing issues such as how much global giants like Facebook and Amazon should pay in taxes. 

 

They’re likely to end up focusing a large share of their attention on how to keep global growth on track when the world’s two biggest economies are entrenched in an escalating trade war. 

 

U.S. Treasury Secretary Steven Mnuchin, who has headed trade talks with Beijing along with U.S. Trade Representative Robert Lighthizer, was due to meet with Yi Gang, governor of China’s central bank, on the sidelines of the G-20’s annual financial gathering in Fukuoka in southern Japan. 

 

But it was unclear if their meeting, a possible prelude to talks at the G-20 summit later this month between President Donald Trump and Chinese President Xi Jinping, might lead to a restart of those talks after weeks of stalemate. 

China’s ability to endure

 

As the Trump administration prepares to expand retaliatory tariff hikes of up to 25% to another $300 billion of Chinese products, Beijing has sought to highlight China’s capacity to endure and overcome hardship.  

 

Yi told Bloomberg Television in an interview broadcast Friday that he expected the meeting with Mnuchin to be “difficult.” But he said China’s central bank, the People’s Bank of China, had plenty of room to maneuver to help keep the economy growing despite the pounding the country’s export manufacturers are taking as the toll from higher tariffs mounts. 

 

Speaking Thursday in France, Trump said he plans to make a decision about ramping up tariffs on China after speaking with Xi at the summit in Osaka at the month’s end.

“I will make that decision, I would say, over the next two weeks — probably right after the G-20,” he said.

The Trump administration began slapping tariffs on imports of Chinese goods nearly a year ago, accusing China of resorting to predatory tactics to give Chinese companies an edge in advanced technologies such as artificial intelligence, robotics and electric vehicles. These tactics, the U.S. contends, include hacking into U.S. companies’ computers to steal trade secrets, forcing foreign companies to hand over sensitive technology in exchange for access to the Chinese market and unfairly subsidizing Chinese tech firms.

Trade deficit

Trump has also complained repeatedly about America’s huge trade deficit with China — a record $379 billion last year — which he blames on weak and naive negotiating by previous U.S. administrations.

The United States now is imposing 25% taxes on $250 billion in Chinese goods. Beijing has counterpunched by targeting $110 billion worth of American products, focusing on farm goods such as soybeans in a deliberate effort to inflict pain on Trump supporters in the U.S. heartland.

Unease over trade tensions and their potential impact on other economies has deepened since Trump announced he would impose a 5% tax on Mexican products starting Monday — a tax that would reach 25% by Oct. 1 if the Mexican government fails to stop the flow of Central American migrants into the United States.

While the tariffs have taken a minor toll on the U.S. economy, the uncertainty and slowing demand are rippling across the globe. Earlier this week, the World Bank downgraded its forecast for the global economy in light of trade conflicts, financial strains and unexpectedly sharp slowdowns in wealthier countries.

Slashing rates

The weakness has prompted central banks, most recently in Australia and India, to slash interest rates to fend off recession. 

 

Japan, hosting the G-20 for the first time since it was founded in 1999, has plumbed the limits of that strategy. The Bank of Japan’s policy interest rate has been at minus 0.1% for years, to keep credit cheap and support a modest pace of expansion.

As the trade conflicts percolate, the officials gathering in Fukuoka, a bustling port city on the southern main island of Kyushu, will carry on chipping away at financial reforms and other perennial issues. 

 

Some European members of the G-20, especially, want to see minimum corporate tax rates for big multinationals. 

 

Japan’s Kyodo News service reported Friday, citing a draft communique, that the finance leaders are also discussing the issue of how developing countries are handling debts incurred through major construction projects, efforts to combat money laundering, and efforts to prevent terrorist groups from using cybercurrencies as a source of funding.
…

your ads here!

Russian President Vladimir Putin has criticized the United States for using pressure and sanctions to maintain its economic supremacy.

Speaking Friday at an investment forum in St. Petersburg, Putin said the U.S. attempt to “spread its jurisdiction to the entire world” challenges the global order.

He said globalization “becomes a parody of itself when common international rules are replaced with laws, administrative and judicial mechanisms of one country or a group of countries.”

Flanked by Chinese President Xi Jinping at the forum’s panel, Putin said the U.S. action against Chinese telecom giant Huawei represented an attempt to “blatantly squeeze it out of the global market.”

It is, he said, “the first technological war of the digital era.”

Putin warned that the “fragmentation of the global economic space, the policy of unrestrained political egoism” paves the way to “endless conflicts and trade wars … fights without rules between all.”

He specifically criticized U.S. attempts to hamper the construction of the Nord Stream 2 pipeline intended to carry Russian natural gas to Germany and further on in Europe, saying it reflects the U.S. desire to win advantages for itself.

Xi said Russia and China would coordinate their efforts in the energy sphere more closely.
…

your ads here!

Italian-U.S. carmaker Fiat Chrysler on Thursday pulled the plug on its proposed merger with Renault, saying negotiations had become “unreasonable” because of  political resistance in Paris.  

 

Fiat Chrysler Automobiles, or FCA, had stunned the markets last week with a proposed “merger of equals” with the French group that would — together with Renault’s Japanese partners, Nissan and Mitsubishi Motors — create an auto giant spanning the globe.  

 

The French government, which controls 15 percent of Renault, gave the deal a conditional green light, with analysts suggesting it wanted more control over the combined group alongside Fiat’s Agnelli family. 

 

FCA said late Wednesday that it “remains firmly convinced of the compelling, transformational rationale” of the tie-up, which it said was “carefully balanced to deliver substantial benefits to all parties.”

 

“However it has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully,” it said in a statement.  

 

On Thursday, FCA chief John Elkann stood by the decision to start, and then leave, the merger talks. 

 

“When it becomes clear that the conversations have been brought to the point beyond which it becomes unreasonable to go, it is necessary to be equally brave to interrupt them,” Elkann wrote in a letter to employees published by Italian media.  

Renault expressed its “disappointment” at the turnabout. 

 

“We view the [Fiat] opportunity as timely, having compelling industrial logic and great financial merit, and which would result in a European-based global auto powerhouse,” it said in a statement. 

 

The combined group, including Nissan and Mitsubishi, would have been by far the world’s biggest, with total sales of 15 million vehicles, compared with both Volkswagen and Toyota, which sell around 10.6 million apiece. 

 

Shares in Renault plunged by more than 6 percent on the Paris stock exchange. In Milan, FCA shares also initially slid but then recovered to close up 0.1 percent.

Nissan holds key

Despite the verbal sparring that erupted after FCA’s announcement, industry experts did not rule out talks being resumed.  

 

“The collapse of the proposed Fiat Chrysler/Renault merger leaves both firms exposed to the shifting dynamics of a sector at a crossroads,” Ilana Elbim, credit analyst for Hermes Investment Management, said in a note.  

 

Pointing to falling sales volumes in major auto markets, she said “mega-mergers designed to save on capital expenditures remain inevitable.” 

 

On Tuesday, Renault’s board had said it was studying FCA’s offer “with interest,” but held off final approval pending further deliberations.  

 

By Wednesday, all Renault directors had come around in favor of the merger, with the exception of the employee representative affiliated with the powerful CGT union and two from Nissan who abstained, according to a source close to Renault.   

The two Nissan directors were said to have asked for more time to approve the deal. There was no official comment from Nissan headquarters in Tokyo. 

 

Relations between Renault and Nissan have come under strain since the arrest in November of their joint boss, Carlos Ghosn, who awaits trial in Japan on charges of financial misconduct. 

 

French Finance Minister Bruno Le Maire had laid down conditions for the tie-up with FCA, insisting there be no plant closures and that the Renault-Nissan alliance be preserved.  

 

The Renault source said Le Maire had asked for another board meeting next Tuesday following his return from a trip to Japan, where he was to discuss the proposal with his Japanese counterpart at a meeting of G-20 finance ministers.  

Blame game

A source close to FCA said it was the “sudden and incomprehensible” objections by Le Maire’s ministry that had caused the deal to collapse. 

 

Italian Deputy Prime Minister Luigi Di Maio said: “When politics tries to intervene in economic procedures, they don’t always behave correctly, I don’t want to say any more.”   

But Le Maire stressed that, of his conditions, only the explicit approval of Nissan remained to be secured, while aides denied that the ministry had played politics with the deal. 

 

A source close to the finance ministry said the French government “regrets the hasty decision of FCA.” 

 

“Despite significant progress, a short delay was still necessary so that all conditions set by the state could be met,” it said. 

 

Le Maire indicated the French government was amenable to changes at Renault despite FCA’s U-turn. 

 

“We remain open to the prospect of industrial consolidation, but once again, in calmness, without haste, to guarantee the industrial interests of Renault and the industrial interests of the French nation,” he told the French parliament. 

 

For his part, Elkann said FCA “will continue to be open to opportunities of all kinds that offer the possibility of strengthening and accelerating the realization of this strategy and creating value.” 
…

your ads here!