The investigation into the final minutes of Ethiopian Airlines Flight 302 turned on Tuesday to the secrets in the cockpit voice recorder as Boeing and a shaken global aviation industry hung on the outcome.

The voices of Captain Yared Getachew and First Officer Ahmednur Mohammed could reveal what led to the March 10 crash of the Boeing 737 MAX that has worrying parallels with another disaster involving the same model off Indonesia in October.

The twin disasters killed 346 people.

Black box data was downloaded in France but only Ethiopian experts leading the probe have heard the dialogue between Getachew, 29, and Mohammed, 25. The data was back in Addis Ababa on Tuesday, sources familiar with the probe told Reuters.

Experts believe a new automated system in Boeing’s flagship MAX fleet — intended to stop stalling by dipping the nose — may have played a role in both crashes, with pilots unable to override it as their jets plunged downwards.

Both came down just minutes after take-off after erratic flight patterns and loss of control reported by the pilots.

However, every accident is a unique chain of human and technical factors, experts say.

The prestige of Ethiopian Airlines, one of Africa’s most successful companies, and Boeing, the world’s biggest planemaker and a massive U.S. exporter, is at stake.

Awkward questions for industry

Lawmakers and safety experts are questioning how thoroughly regulators vetted the MAX model and how well pilots were trained on new features. For now, regulators have grounded the existing fleet of more than 300 MAX aircraft and deliveries of nearly

5,000 more — worth well over $500 billion — are on hold.

Pressure on the Chicago-headquartered company has grown with news that federal prosecutors and the U.S. Department of Transportation are scrutinizing how carefully the MAX model was developed, two people briefed on the matter said.

The U.S. Justice Department was looking at the Federal Aviation Administration’s (FAA) oversight of Boeing, one of the people said. And a federal grand jury last week issued at least one subpoena to an entity involved in the plane’s development. The rest of the world is watching anxiously.

The European Union’s aviation agency EASA promised its own deep look at Boeing’s software updates and failure modes.

“We will not allow the aircraft to fly if we have not found acceptable answers to all our questions,” its executive director Patrick Ky told an EU parliament committee hearing.

“Whatever the FAA does. OK? This is a personal guarantee that I make in front of you.”

Canada said it would independently certify the MAX in future, rather than accepting FAA validation, and would also send a team to help U.S. authorities evaluate proposed design changes.

In the hope of getting its MAX line back into the air soon, Boeing said it will roll out a software update and revise pilot training. In the case of the Lion Air crash in Indonesia, it has raised questions about whether crew used the correct procedures.

The MAX, which offers cost savings of about 15 percent on fuel, was developed for service from 2017 after the successful launch by its main rival of the Airbus A320neo.

Argus Research cut Boeing stock to “hold” from “buy”, giving the planemaker at least its fourth downgrade since the crash, Refinitiv data showed. Its shares, however, were enjoying a rare respite on Tuesday, up 1.6 pct to $378 and cutting losses since the crash to under 11 pct.

Global ramifications

In the hot seat over its certification of the MAX without demanding additional training and its closeness to Boeing, the FAA has said it is “absolutely” confident in its vetting.

The crisis has put pressure on airline companies.

Norwegian Airlines has already said it will seek compensation after grounding its MAX aircraft.

Various firms are reconsidering Boeing orders, and some are revising financial forecasts given they now cannot count on maintenance and fuel savings factored in from the MAX.

Illustrating the hoops airlines were jumping through, Air Canada said it intends to keep its MAX aircraft grounded until at least July 1, would accelerate intake of recently acquired Airbus A321 planes, and had hired other carriers to provide extra capacity meantime.

Beyond the corporate ramifications, anguished relatives are still waiting to find out what happened.

Many have visited the crash site in a charred field to seek some closure, but there is anger at the slow pace of information and all they have been given for funerals is earth.

“I’m just so terribly sad. I had to leave here without the body of my dead brother,” said Abdulmajid Shariff, a Yemeni relative who headed home disappointed on Tuesday.
…

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Warner Bros. chief Kevin Tsujihara, one of the highest ranking Hollywood executives to be felled by sexual misconduct allegations, stepped down from the studio Monday following claims that he promised roles to an actress with whom he was having an affair.

WarnerMedia chief executive John Stankey announced Tsujihara’s exit as chairman and chief executive of Warner Bros., saying his departure was in the studio’s “best interest.”

 

“Kevin has contributed greatly to the studio’s success over the past 25 years and for that we thank him,” said Stankey. “Kevin acknowledges that his mistakes are inconsistent with the company’s leadership expectations and could impact the company’s ability to execute going forward.”

 

Earlier this month, WarnerMedia launched an investigation after a March 6 Hollywood Reporter story detailed text messages between Tsujihara and British actress Charlotte Kirk going back to 2013. The messages suggested a quid pro quo sexual relationship between the aspiring actress and the studio head in which he made promises that he’d introduce her to influential executives and she’d be considered for roles in movies and television.

 

In a memo to Warner Bros. staff on Monday, Tsujihara said he was departing “after lengthy introspection, and discussions with John Stankey over the past week.”

 

“It has become clear that my continued leadership could be a distraction and an obstacle to the company’s continued success,” said Tsujihara. “The hard work of everyone within our organization is truly admirable, and I won’t let media attention on my past detract from all the great work the team is doing.”

 

Tsujihara’s attorney, Bert H. Deixler, earlier stated that Tsujihara “had no direct role in the hiring of this actress.” He declined further comment Monday.

 

Tsujihara, who has headed the Burbank, California, studio since 2013, earlier pledged to fully cooperate with the studio’s investigation and apologized to Warner Bros. staff for “mistakes in my personal life that have caused pain and embarrassment to the people I love the most.”

 

The scandal unfolded just as Warner Bros. was restructuring on the heels of AT&T’s takeover of WarnerMedia, previously known as Time Warner. Tsujihara’s role had just been expanded on Feb. 28 to include global kids and family entertainment including oversight of Adult Swim and the Cartoon Network.

Kirk appeared in Warner Bros.’ “How to Be Single” in 2016 and “Ocean’s 8” in 2018. She has denied any inappropriate behavior on the part of Tsujihara or two other executives, Brett Ratner and James Packer, who she communicated with. “Mr. Tsujihara never promised me anything,” Kirk said in an earlier statement.

 

But the details of the leaked text messages between Tsujihara and Kirk immediately put his future at Warner Bros. in jeopardy. Kirk wrote in one 2015 message to him: “Are u going to help me like u said u would?” Tsujhara responded, “Richard will be reaching out to u tonight,” referring to Richard Brener, president of Warner Bros.’ New Line label.

 

Other exchanges suggested the kind of give-and-take of Hollywood’s “casting couch” culture. Kirk was introduced to Tsujihara by James Packer, the Australian billionaire. Warner Bros. was then finalizing a $450-million co-financing deal with Packer and Brett Ratner, the director-producer. In a message to Ratner, Kirk said she was “used as icing on the cake.”

 

WarnerMedia, the studio’s parent company, said Monday that its internal investigation into the situation, carried out by a third-party law firm, will continue.

 

Tsujihara’s exit follows other high-profile executive departures in the post-Harvey Weinstein (hash)MeToo era. CBS Chairman Leslie Moonves was pushed out after numerous women accused him of sexual harassment. Walt Disney Animation chief John Lasseter was ousted after he acknowledged missteps in his behavior with employees.

 

The 54-year-old Tsujihara, the first executive of Asian descent to head a major Hollywood studio, presided over a largely positive Warner Bros. era with little fanfare. A former home video and video game executive at the company, Tsujihara focused on franchise creation, some of which have worked, some of which haven’t.

 

After poor marks from fans and critics, the studio’s DC Comics films have recently been retooled and found their footing in hits like “Wonder Woman” and “Aquaman.” Other franchises — like “The Lego Movie” and the “Harry Potter” spinoff “Fantastic Beasts and Where to Find Them” — have seen diminishing returns on their latest incarnations. The studio has also fostered its connection with filmmakers like Christopher Nolan (“Dunkirk”) and Bradley Cooper (whose “A Star Is Born” was Warner Bros.’ top Oscar contender). Warner Bros. last year amassed $5.6 billion in global ticket sales, its best haul ever.

 

The studio will now begin a search for a new chief as it also prepares to launch a streaming service designed to compete with Netflix.
…

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Warner Bros. chief Kevin Tsujihara, one of the highest ranking Hollywood executives to be felled by sexual misconduct allegations, stepped down from the studio Monday following claims that he promised roles to an actress with whom he was having an affair.

WarnerMedia chief executive John Stankey announced Tsujihara’s exit as chairman and chief executive of Warner Bros., saying his departure was in the studio’s “best interest.”

 

“Kevin has contributed greatly to the studio’s success over the past 25 years and for that we thank him,” said Stankey. “Kevin acknowledges that his mistakes are inconsistent with the company’s leadership expectations and could impact the company’s ability to execute going forward.”

 

Earlier this month, WarnerMedia launched an investigation after a March 6 Hollywood Reporter story detailed text messages between Tsujihara and British actress Charlotte Kirk going back to 2013. The messages suggested a quid pro quo sexual relationship between the aspiring actress and the studio head in which he made promises that he’d introduce her to influential executives and she’d be considered for roles in movies and television.

 

In a memo to Warner Bros. staff on Monday, Tsujihara said he was departing “after lengthy introspection, and discussions with John Stankey over the past week.”

 

“It has become clear that my continued leadership could be a distraction and an obstacle to the company’s continued success,” said Tsujihara. “The hard work of everyone within our organization is truly admirable, and I won’t let media attention on my past detract from all the great work the team is doing.”

 

Tsujihara’s attorney, Bert H. Deixler, earlier stated that Tsujihara “had no direct role in the hiring of this actress.” He declined further comment Monday.

 

Tsujihara, who has headed the Burbank, California, studio since 2013, earlier pledged to fully cooperate with the studio’s investigation and apologized to Warner Bros. staff for “mistakes in my personal life that have caused pain and embarrassment to the people I love the most.”

 

The scandal unfolded just as Warner Bros. was restructuring on the heels of AT&T’s takeover of WarnerMedia, previously known as Time Warner. Tsujihara’s role had just been expanded on Feb. 28 to include global kids and family entertainment including oversight of Adult Swim and the Cartoon Network.

Kirk appeared in Warner Bros.’ “How to Be Single” in 2016 and “Ocean’s 8” in 2018. She has denied any inappropriate behavior on the part of Tsujihara or two other executives, Brett Ratner and James Packer, who she communicated with. “Mr. Tsujihara never promised me anything,” Kirk said in an earlier statement.

 

But the details of the leaked text messages between Tsujihara and Kirk immediately put his future at Warner Bros. in jeopardy. Kirk wrote in one 2015 message to him: “Are u going to help me like u said u would?” Tsujhara responded, “Richard will be reaching out to u tonight,” referring to Richard Brener, president of Warner Bros.’ New Line label.

 

Other exchanges suggested the kind of give-and-take of Hollywood’s “casting couch” culture. Kirk was introduced to Tsujihara by James Packer, the Australian billionaire. Warner Bros. was then finalizing a $450-million co-financing deal with Packer and Brett Ratner, the director-producer. In a message to Ratner, Kirk said she was “used as icing on the cake.”

 

WarnerMedia, the studio’s parent company, said Monday that its internal investigation into the situation, carried out by a third-party law firm, will continue.

 

Tsujihara’s exit follows other high-profile executive departures in the post-Harvey Weinstein (hash)MeToo era. CBS Chairman Leslie Moonves was pushed out after numerous women accused him of sexual harassment. Walt Disney Animation chief John Lasseter was ousted after he acknowledged missteps in his behavior with employees.

 

The 54-year-old Tsujihara, the first executive of Asian descent to head a major Hollywood studio, presided over a largely positive Warner Bros. era with little fanfare. A former home video and video game executive at the company, Tsujihara focused on franchise creation, some of which have worked, some of which haven’t.

 

After poor marks from fans and critics, the studio’s DC Comics films have recently been retooled and found their footing in hits like “Wonder Woman” and “Aquaman.” Other franchises — like “The Lego Movie” and the “Harry Potter” spinoff “Fantastic Beasts and Where to Find Them” — have seen diminishing returns on their latest incarnations. The studio has also fostered its connection with filmmakers like Christopher Nolan (“Dunkirk”) and Bradley Cooper (whose “A Star Is Born” was Warner Bros.’ top Oscar contender). Warner Bros. last year amassed $5.6 billion in global ticket sales, its best haul ever.

 

The studio will now begin a search for a new chief as it also prepares to launch a streaming service designed to compete with Netflix.
…

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U.S. prosecutors are looking into the development of Boeing’s 737 Max jets, a person briefed on the matter revealed Monday, the same day French aviation investigators concluded there were “clear similarities” in the crash of an Ethiopian Airlines Max 8 last week and a Lion Air jet in October.

 

The Justice Department probe will examine the way Boeing was regulated by the Federal Aviation Administration, said the person, who asked not to be identified because the inquiry is not public.

 

A federal grand jury in Washington sent a subpoena to someone involved in the plane’s development seeking emails, messages and other communications, the person told The Associated Press.

 

The Transportation Department’s inspector general is also looking into the FAA’s approval of the Boeing 737 Max, a U.S. official told AP. The official wasn’t authorized to discuss the matter publicly and spoke on condition of anonymity. The Wall Street Journal reported on the probe Sunday said the inspector general was looking into the plane’s anti-stall system. It quotes unidentified people familiar with both cases.

 

The anti-stall system may have been involved in the Oct. 29 crash of a Lion Air jet off of Indonesia that killed 189 people. It’s also under scrutiny in the March 10 crash of an Ethiopian Airlines jet that killed 157.

 

The Transportation Department’s FAA regulates Chicago-based Boeing and is responsible for certifying that planes can fly safely.

 

The grand jury issued its subpoena on March 11, one day after the Ethiopian Airlines crash, according to the person who spoke to The Associated Press.

 

Spokesmen for the Justice Department and the inspector general said Monday they could neither confirm nor deny the existence of any inquiries. The FAA would not comment.

 

“Boeing does not respond to or comment on questions concerning legal matters, whether internal, litigation, or governmental inquiries,” Boeing spokesman Charles Bickers said in an email.

 

The company late Monday issued an open letter from its CEO, Dennis Muilenburg, addressed to airlines, passengers and the aviation community. Muilenburg did not refer to the reports of the Justice Department probe, but stressed his company is taking actions to ensure its 737 Max jets are safe.

 

Those include an upcoming release of a software update and related pilot training for the 737 Max to “address concerns” that arose in the aftermath of October’s Lion Air crash, Muilenburg said. The planes’ new flight-control software is suspected of playing a role in the crashes.

The French civil aviation investigation bureau BEA said Monday that black box data from the Ethiopian Airlines flight showed the links with the Lion Air crash and will be used for further study.

 

Ethiopian authorities asked BEA for help in extracting and interpreting the crashed plane’s black boxes because Ethiopia does not have the necessary expertise and technology.

The Ethiopian Accident Investigation Bureau intends to release a preliminary report within 30 days.

The United States and many other countries have grounded the Max 8s and larger Max 9s as Boeing faces the challenge of proving the jets are safe to fly amid suspicions that faulty sensors and software contributed to the two crashes in less than five months.

 

Both planes flew with erratic altitude changes that could indicate the pilots struggled to control the aircraft. Shortly after their takeoffs, both crews tried to return to the airports but crashed.

 

Boeing has said it has “full confidence” in the planes’ safety. Engineers are making changes to the system designed to prevent an aerodynamic stall if sensors detect that the jet’s nose is pointed too high and its speed is too slow.

 

Investigators looking into the Indonesian crash are examining whether the software automatically pushed the plane’s nose down repeatedly, and whether the Lion Air pilots knew how to solve that problem. Ethiopian Airlines says its pilots received special training on the software.

Dennis Tajer, an American Airlines pilot and a spokesman for their union, said Boeing held a discussion with airlines last Thursday but did not invite pilots at American or Southwest, the two U.S. carriers that use the same version of the Max that crashed in Indonesia and Ethiopia.

 

Tajer said airline officials told the unions that Boeing intends to offer pilots about a 15-minute iPad course to train them on the new flight-control software on Max jets that is suspected of playing a role in the crashes. He called that amount of training unacceptable.

 

“Our sense is it’s a rush to comply — ‘let’s go, let’s go, let’s go,'” Tajer said. “I’m in a rush to protect my passengers.”

 

A spokesman for the pilots’ union at Southwest Airlines also said Boeing representatives told that union they expected the upgrade to be ready the end of January.

 

The spokesman, Mike Trevino, said Boeing never followed up to explain why that deadline passed without an upgrade. Boeing was expected to submit a proposed fix to the FAA in early January.

 

 

 
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U.S. prosecutors are looking into the development of Boeing’s 737 Max jets, a person briefed on the matter revealed Monday, the same day French aviation investigators concluded there were “clear similarities” in the crash of an Ethiopian Airlines Max 8 last week and a Lion Air jet in October.

 

The Justice Department probe will examine the way Boeing was regulated by the Federal Aviation Administration, said the person, who asked not to be identified because the inquiry is not public.

 

A federal grand jury in Washington sent a subpoena to someone involved in the plane’s development seeking emails, messages and other communications, the person told The Associated Press.

 

The Transportation Department’s inspector general is also looking into the FAA’s approval of the Boeing 737 Max, a U.S. official told AP. The official wasn’t authorized to discuss the matter publicly and spoke on condition of anonymity. The Wall Street Journal reported on the probe Sunday said the inspector general was looking into the plane’s anti-stall system. It quotes unidentified people familiar with both cases.

 

The anti-stall system may have been involved in the Oct. 29 crash of a Lion Air jet off of Indonesia that killed 189 people. It’s also under scrutiny in the March 10 crash of an Ethiopian Airlines jet that killed 157.

 

The Transportation Department’s FAA regulates Chicago-based Boeing and is responsible for certifying that planes can fly safely.

 

The grand jury issued its subpoena on March 11, one day after the Ethiopian Airlines crash, according to the person who spoke to The Associated Press.

 

Spokesmen for the Justice Department and the inspector general said Monday they could neither confirm nor deny the existence of any inquiries. The FAA would not comment.

 

“Boeing does not respond to or comment on questions concerning legal matters, whether internal, litigation, or governmental inquiries,” Boeing spokesman Charles Bickers said in an email.

 

The company late Monday issued an open letter from its CEO, Dennis Muilenburg, addressed to airlines, passengers and the aviation community. Muilenburg did not refer to the reports of the Justice Department probe, but stressed his company is taking actions to ensure its 737 Max jets are safe.

 

Those include an upcoming release of a software update and related pilot training for the 737 Max to “address concerns” that arose in the aftermath of October’s Lion Air crash, Muilenburg said. The planes’ new flight-control software is suspected of playing a role in the crashes.

The French civil aviation investigation bureau BEA said Monday that black box data from the Ethiopian Airlines flight showed the links with the Lion Air crash and will be used for further study.

 

Ethiopian authorities asked BEA for help in extracting and interpreting the crashed plane’s black boxes because Ethiopia does not have the necessary expertise and technology.

The Ethiopian Accident Investigation Bureau intends to release a preliminary report within 30 days.

The United States and many other countries have grounded the Max 8s and larger Max 9s as Boeing faces the challenge of proving the jets are safe to fly amid suspicions that faulty sensors and software contributed to the two crashes in less than five months.

 

Both planes flew with erratic altitude changes that could indicate the pilots struggled to control the aircraft. Shortly after their takeoffs, both crews tried to return to the airports but crashed.

 

Boeing has said it has “full confidence” in the planes’ safety. Engineers are making changes to the system designed to prevent an aerodynamic stall if sensors detect that the jet’s nose is pointed too high and its speed is too slow.

 

Investigators looking into the Indonesian crash are examining whether the software automatically pushed the plane’s nose down repeatedly, and whether the Lion Air pilots knew how to solve that problem. Ethiopian Airlines says its pilots received special training on the software.

Dennis Tajer, an American Airlines pilot and a spokesman for their union, said Boeing held a discussion with airlines last Thursday but did not invite pilots at American or Southwest, the two U.S. carriers that use the same version of the Max that crashed in Indonesia and Ethiopia.

 

Tajer said airline officials told the unions that Boeing intends to offer pilots about a 15-minute iPad course to train them on the new flight-control software on Max jets that is suspected of playing a role in the crashes. He called that amount of training unacceptable.

 

“Our sense is it’s a rush to comply — ‘let’s go, let’s go, let’s go,'” Tajer said. “I’m in a rush to protect my passengers.”

 

A spokesman for the pilots’ union at Southwest Airlines also said Boeing representatives told that union they expected the upgrade to be ready the end of January.

 

The spokesman, Mike Trevino, said Boeing never followed up to explain why that deadline passed without an upgrade. Boeing was expected to submit a proposed fix to the FAA in early January.

 

 

 
…

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Investigators into the Boeing 737 MAX crash in Ethiopia have found striking similarities in a vital flight angle with an airplane that came down off Indonesia, a source said, piling pressure on the world’s biggest planemaker.

The Ethiopian Airlines disaster eight days ago killed 157 people, led to the grounding of Boeing’s marquee MAX fleet globally and sparked a high-stakes inquiry for the aviation industry.

Analysis of the cockpit recorder showed its “angle of attack” data was “very, very similar” to that of the Lion Air jet that went down off Jakarta in October, killing 189 people, a person familiar with the investigation said.

The angle of attack is a fundamental parameter of flight, measuring the degrees between the air flow and the wing. If it is too high, it can throw the plane into an aerodynamic stall.

“If that’s the case, that does raise the possibility that there is a similar occurrence between the Lion Air and Ethiopian Airlines accidents,” said Clint Balog, a Montana-based professor at Embry-Riddle Aeronautical University.

Even then, it was too early to draw firm conclusions, he added.

A flight deck computer’s response to an apparently faulty angle-of-attack sensor is at the heart of the ongoing probe into the Lion Air crash.

Ethiopia’s Transport Ministry, France’s BEA air accident authority and the U.S. Federal Aviation Administration (FAA) have all pointed to similarities between the two disasters, but safety officials stress the investigation is at an early stage.

“Everything will be investigated,” Ethiopian Transport Ministry spokesman Musie Yehyies told Reuters.

Both planes were 737 MAX 8s and crashed minutes after takeoff with pilots reporting flight control problems.

Under scrutiny is a new automated system in the 737 MAX model that guides the nose lower to avoid stalling, while Boeing has raised questions in the Lion Air case about whether crew used the correct procedures.

Lawmakers and safety experts are asking how thoroughly regulators vetted the system and how well pilots around the world were trained for it when their airlines bought new planes.

Boeing Plans New Software

Boeing Chief Executive Dennis Muilenburg, facing the biggest crisis of his tenure, said on Monday the company understands that “lives depend on the work we do.”

Muilenburg also said a software upgrade for its 737 MAX aircraft that the planemaker started in the aftermath of the Lion Air deadly plane crash was coming “soon.”

The fix was developed when regulators suggested false sensor data could cause a system known as MCAS (Maneuvering Characteristics Augmentation System) to overreact and make the jet hard to control.

Canada is re-examining the validation it gave Boeing’s 737 MAX jets, following reports of a U.S. probe into the aircraft’s certification by the FAA, Canadian Transport Minister Marc Garneau said on Monday.

Acting FAA Administrator Dan Elwell said on Wednesday in a call with reporters that he was “absolutely” confident in the certification of the Boeing 737 MAX 8. The FAA did not immediately respond to a request for comment on Canada’s action.

The FAA finds itself in the hot seat, especially over its decision to certify the 737 MAX without demanding additional training. FAA and Boeing will face congressional questions about why the software upgrade took so long to complete and whether Boeing had too great a role in the certification process.

With the prestige of one of the United States’ biggest exporters at stake, Boeing has halted deliveries of its best-selling model that was intended to be the industry standard but is now under a shadow. Developed in response to the successful launch of the Airbus A320neo, some 370 MAX jets were in operation at the time of the Ethiopian crash, and nearly 5,000 more on order.

After a 10 percent drop last week that wiped nearly $25 billion off its market share, Boeing stock slid about 1.8 percent on Monday.

Weekend media reports intensified pressure on Boeing and its domestic U.S. regulator following a call last week by a U.S. flight attendants union for a “certification review.”

The Seattle Times said the company’s safety analysis of the MCAS system had crucial flaws, including understating power.

The Wall Street Journal reported that prosecutors and the U.S. Department of Transportation were scrutinizing the FAA’s approval of the MAX series, while a jury had issued a subpoena to at least one person involved in its development.

Boeing and the FAA declined to comment on that.

Last week, sources told Reuters that investigators found a piece of a stabilizer in the Ethiopian wreckage set in an unusual position similar to that of the Lion Air plane.

Future Orders at Stake

Ethiopia is leading the probe, although the black boxes were sent to France and U.S. experts are also participating.

Investigators were expected to select a handful of the roughly 1,800 parameters of flight data in their initial review, including those thrown up by the Lion Air investigation, before analyzing the rest in coming weeks and months.

Norwegian Airlines has already said it will seek compensation after grounding its MAX aircraft, and various companies are reconsidering orders.

Boeing’s main rival, Airbus, has seen its stock rise 5 percent since the crash, but cannot simply pick up the slack given the complicated logistics of plane-building.

For now, Boeing continues to build planes while keeping them parked.

Some airlines are revising financial forecasts, too, given the MAX had been factored in as providing around 15 percent maintenance and fuel savings.

WestJet Airlines Ltd. on Monday became the second Canadian carrier to suspend its 2019 financial projections, following Air Canada in light of the 737 MAX groundings.
…

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Investigators into the Boeing 737 MAX crash in Ethiopia have found striking similarities in a vital flight angle with an airplane that came down off Indonesia, a source said, piling pressure on the world’s biggest planemaker.

The Ethiopian Airlines disaster eight days ago killed 157 people, led to the grounding of Boeing’s marquee MAX fleet globally and sparked a high-stakes inquiry for the aviation industry.

Analysis of the cockpit recorder showed its “angle of attack” data was “very, very similar” to that of the Lion Air jet that went down off Jakarta in October, killing 189 people, a person familiar with the investigation said.

The angle of attack is a fundamental parameter of flight, measuring the degrees between the air flow and the wing. If it is too high, it can throw the plane into an aerodynamic stall.

“If that’s the case, that does raise the possibility that there is a similar occurrence between the Lion Air and Ethiopian Airlines accidents,” said Clint Balog, a Montana-based professor at Embry-Riddle Aeronautical University.

Even then, it was too early to draw firm conclusions, he added.

A flight deck computer’s response to an apparently faulty angle-of-attack sensor is at the heart of the ongoing probe into the Lion Air crash.

Ethiopia’s Transport Ministry, France’s BEA air accident authority and the U.S. Federal Aviation Administration (FAA) have all pointed to similarities between the two disasters, but safety officials stress the investigation is at an early stage.

“Everything will be investigated,” Ethiopian Transport Ministry spokesman Musie Yehyies told Reuters.

Both planes were 737 MAX 8s and crashed minutes after takeoff with pilots reporting flight control problems.

Under scrutiny is a new automated system in the 737 MAX model that guides the nose lower to avoid stalling, while Boeing has raised questions in the Lion Air case about whether crew used the correct procedures.

Lawmakers and safety experts are asking how thoroughly regulators vetted the system and how well pilots around the world were trained for it when their airlines bought new planes.

Boeing Plans New Software

Boeing Chief Executive Dennis Muilenburg, facing the biggest crisis of his tenure, said on Monday the company understands that “lives depend on the work we do.”

Muilenburg also said a software upgrade for its 737 MAX aircraft that the planemaker started in the aftermath of the Lion Air deadly plane crash was coming “soon.”

The fix was developed when regulators suggested false sensor data could cause a system known as MCAS (Maneuvering Characteristics Augmentation System) to overreact and make the jet hard to control.

Canada is re-examining the validation it gave Boeing’s 737 MAX jets, following reports of a U.S. probe into the aircraft’s certification by the FAA, Canadian Transport Minister Marc Garneau said on Monday.

Acting FAA Administrator Dan Elwell said on Wednesday in a call with reporters that he was “absolutely” confident in the certification of the Boeing 737 MAX 8. The FAA did not immediately respond to a request for comment on Canada’s action.

The FAA finds itself in the hot seat, especially over its decision to certify the 737 MAX without demanding additional training. FAA and Boeing will face congressional questions about why the software upgrade took so long to complete and whether Boeing had too great a role in the certification process.

With the prestige of one of the United States’ biggest exporters at stake, Boeing has halted deliveries of its best-selling model that was intended to be the industry standard but is now under a shadow. Developed in response to the successful launch of the Airbus A320neo, some 370 MAX jets were in operation at the time of the Ethiopian crash, and nearly 5,000 more on order.

After a 10 percent drop last week that wiped nearly $25 billion off its market share, Boeing stock slid about 1.8 percent on Monday.

Weekend media reports intensified pressure on Boeing and its domestic U.S. regulator following a call last week by a U.S. flight attendants union for a “certification review.”

The Seattle Times said the company’s safety analysis of the MCAS system had crucial flaws, including understating power.

The Wall Street Journal reported that prosecutors and the U.S. Department of Transportation were scrutinizing the FAA’s approval of the MAX series, while a jury had issued a subpoena to at least one person involved in its development.

Boeing and the FAA declined to comment on that.

Last week, sources told Reuters that investigators found a piece of a stabilizer in the Ethiopian wreckage set in an unusual position similar to that of the Lion Air plane.

Future Orders at Stake

Ethiopia is leading the probe, although the black boxes were sent to France and U.S. experts are also participating.

Investigators were expected to select a handful of the roughly 1,800 parameters of flight data in their initial review, including those thrown up by the Lion Air investigation, before analyzing the rest in coming weeks and months.

Norwegian Airlines has already said it will seek compensation after grounding its MAX aircraft, and various companies are reconsidering orders.

Boeing’s main rival, Airbus, has seen its stock rise 5 percent since the crash, but cannot simply pick up the slack given the complicated logistics of plane-building.

For now, Boeing continues to build planes while keeping them parked.

Some airlines are revising financial forecasts, too, given the MAX had been factored in as providing around 15 percent maintenance and fuel savings.

WestJet Airlines Ltd. on Monday became the second Canadian carrier to suspend its 2019 financial projections, following Air Canada in light of the 737 MAX groundings.
…

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Paris and Hong Kong for the first time joined Singapore as the world’s most expensive cities to live in, a study revealed on Tuesday, with utilities and transport driving up the cost of living.

Zurich, Geneva and Japan’s Osaka trailed closely, with emerging market cities like Istanbul and Moscow plummeting down the ranking due to high inflation and currency depreciation, said the Economist Intelligence Unit’s bi-annual survey of 133 cities.

It was the first time in more than 30 years that three cities shared the top spot, a sign that pricey global cities are growing more alike, said the report’s author, Roxana Slavcheva.

“Converging costs in traditionally more expensive cities … is a testament to globalization and the similarity of tastes and shopping patterns,” she said in a statement.

“Even in locations where shopping for groceries may be relatively cheaper, utilities or transportation prices drive up overall cost of living,” she said.

Rising costs in cities are often driven by a vibrant job market attracting skilled workers with high wages, said Anthony Breach, an analyst with the British think tank Center for Cities — which was not involved in the study.

Urban planners need to plan ahead and build more housing to keep prices affordable and overall costs down, Breach told the Thomson Reuters Foundation.

For the EIU survey researchers compared the cost of more than 150 items such as cars, food, rent, transport and clothing in 133 cities.

A woman’s haircut was about $15 in Bangalore, India, compared to $210 in New York, for example, while a bottle of beer was about half a dollar in Lagos, Nigeria, and more than $3 in Zurich.

British cities recovered a few positions a year after reaching the cheapest level in more than two decades due to Brexit uncertainty, with London ranking 22nd and Manchester 51st, up eight and five spots respectively.

Political turmoil in Venezuela plummeted Caracas to the bottom of the ranking, followed by Damascus, Syria, with Karachi, Pakistan, Buenos Aires, Argentina, and New Delhi also featuring among the 10 cheapest cities.

But a city’s drop in the index does not necessarily mean life automatically gets cheaper for people living there, as prices adjust to inflation often quicker than wages, said Gunes Cansiz of the World Resources Institute (WRI), a think tank.

“The cost of living in Istanbul, for example, might seem to have decreased, but since household expenses have increased, this has no positive reflection on the daily life of Istanbulites,” said Cansiz, director at WRI’s Turkey Sustainable Cities program.
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A Brazilian court has ordered Vale SA, the world’s largest iron ore miner, to suspend operations at two more dams, demanding that it prove the structures are stable.

The court decision dated Friday is the latest in a series of orders forcing Vale to halt operations at various dams that contain the muddy detritus of mining operations after one such barrier collapsed in January, killing some 300 people.

Vale has faced growing pressure to prove that its remaining dams are safe. The fatal disaster in the town of Brumadinho was the second of its kind in four years.

The company’s iron ore production is expected to be 82.8 million tons, or 21 percent, lower than was planned for the year due to the restrictions on its Brazil operations, including the planned decommissioning of all its upstream dams, according to data compiled by Reuters.

Karel Luketic, analyst for steel, iron ore and pulp at XP Investimentos, said on Monday he does not expect the impact on Vale’s earnings to be as large because iron ore prices are rising, which could compensate for lower volumes.

The miner said in a statement that the latest suspension, impacting its Minervino and Cordao Nova Vista dams, will not have a significant impact on its operations. It said that mining waste was already being shipped to “other structures,” which it did not identify.

Vale said on Friday it had received a court order to suspend activities at Ouro Preto dam.

Vale shares closed slightly lower in Sao Paulo, losing 0.18 percent to 50.46 reais, in contrast to a rally in rival miners Rio Tinto and BHP.

The company’s shares fell on the same day the Sao Paulo exchange’s main index reached 100,000 for the first time.

The restrictions to Vale operations in Brazil seem to have impacted shipments, something that was not clear in the first weeks after the disaster in Brumadinho.

According to trade ministry data released on Monday, Brazil’s iron ore shipments for the first two weeks of March were 1.29 million tonnes per day on average.

Shipments in February averaged 1.44 million tons per day while in March 2018 they averaged 1.42 million tons.
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A Brazilian court has ordered Vale SA, the world’s largest iron ore miner, to suspend operations at two more dams, demanding that it prove the structures are stable.

The court decision dated Friday is the latest in a series of orders forcing Vale to halt operations at various dams that contain the muddy detritus of mining operations after one such barrier collapsed in January, killing some 300 people.

Vale has faced growing pressure to prove that its remaining dams are safe. The fatal disaster in the town of Brumadinho was the second of its kind in four years.

The company’s iron ore production is expected to be 82.8 million tons, or 21 percent, lower than was planned for the year due to the restrictions on its Brazil operations, including the planned decommissioning of all its upstream dams, according to data compiled by Reuters.

Karel Luketic, analyst for steel, iron ore and pulp at XP Investimentos, said on Monday he does not expect the impact on Vale’s earnings to be as large because iron ore prices are rising, which could compensate for lower volumes.

The miner said in a statement that the latest suspension, impacting its Minervino and Cordao Nova Vista dams, will not have a significant impact on its operations. It said that mining waste was already being shipped to “other structures,” which it did not identify.

Vale said on Friday it had received a court order to suspend activities at Ouro Preto dam.

Vale shares closed slightly lower in Sao Paulo, losing 0.18 percent to 50.46 reais, in contrast to a rally in rival miners Rio Tinto and BHP.

The company’s shares fell on the same day the Sao Paulo exchange’s main index reached 100,000 for the first time.

The restrictions to Vale operations in Brazil seem to have impacted shipments, something that was not clear in the first weeks after the disaster in Brumadinho.

According to trade ministry data released on Monday, Brazil’s iron ore shipments for the first two weeks of March were 1.29 million tonnes per day on average.

Shipments in February averaged 1.44 million tons per day while in March 2018 they averaged 1.42 million tons.
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VOA’s Xu Ning contributed to this report.

Over the past several weeks, the U.S. government has launched a seemingly unprecedented campaign to block the Chinese telecom giant Huawei Technologies from competing in the global rollout of next-generation 5G mobile networking technology, claiming that the company is effectively an arm of the Chinese intelligence services.

In an effort that has included top-level officials from the departments of State, Justice, Defense, Homeland Security, and Commerce, as well as the president himself, the Trump administration has taken steps to curtail Huawei’s ability to operate within the U.S. It has also mounted an extraordinary effort to convince U.S. allies to bar the firm from operating on their soil.

Huawei has long been viewed with suspicion and distrust in many corners of the global economy. The company has a documented history of industrial espionage, and its competitiveness on the global stage has been boosted by massive subsidies from the government in Beijing. Still, the scope of the U.S. government’s current offensive against the company is remarkable.

“Huawei has been accused of many things for a very long time. This is nothing new. What is unique is the extent of the pressure campaign,” said Michael Murphree, assistant professor of International Business at the University of South Carolina’s Darla Moore School of Business. “In the grand scheme of international technology competition, this is certainly a very strong effort against a specific firm.”

The push to keep Huawei from playing a major role in the rollout of 5G comes at a time when the U.S. and China are in talks to end a costly trade war that the U.S. launched last year with the imposition of tariffs against hundreds of billions of dollars’ worth of Chinese exports. In another unprecedented move, President Donald Trump has even tied at least one of the government’s actions against Huawei — a federal indictment in which the company’s chief financial officer has been named — as a potential bargaining chip in trade discussions.

A corporate spokesman for Huawei declined to comment on the Trump Administration’s aggressive tactics.

The case against Huawei

U.S. officials cite a number of reasons to treat Huawei with extreme suspicion, some of them well-documented, others less so.

Top of the list is a National Intelligence law passed in China in 2017 that gives government intelligence services broad and open-ended powers to demand the cooperation of businesses operating in China in intelligence gathering efforts. U.S. policymakers argue that this presents an unambiguous threat to national security.

“In America we can’t even get Apple to crack open an iPhone for the FBI,” Florida Senator Marco Rubio said in a March 13 appearance on Fox Business Network. “In China, Huawei has to give the Chinese anything they ask for.” He added, “They should not be in business in America.”

And while Huawei has strongly denied that it operates as an arm of the Chinese intelligence services, at least two recent international espionage cases have come uncomfortably close to the firm.

 In January, the Polish government arrested a Huawei executive on charges of spying for China. The company itself has not been charged in the case, and Huawei announced that the employee, a sales manager, had been fired.

Early last year, the French newspaper Le Monde Afrique reported that over the course of several years, the computer systems in the Chinese-financed headquarters of the African Union in Addis Ababa were secretly transmitting data toservers in Shanghai every night, and that listening devices had been discovered implanted in the building. It was later revealed that the primary supplier of information and communications technology to the project had been Huawei.

No proof has ever been put forward that Huawei was involved in the data theft, and African Union officials have declined to go on the record confirming that the information transfers ever occurred.

One of the most frequent concerns expressed by U.S. officials about Huawei is the least substantiated: the idea that the company could install secret “backdoor” access to communications equipment that would give the Chinese government ready access to sensitive communications, or even enable Beijing to shut down communications in another country at will.

It’s a claim that Ren Zhengfei, Huawei’s 74-year-old founder and president, has personally ridiculed. The government would never make that request, and Huawei would never comply, he told the BBC recently. “Our sales revenues are now hundreds of billions of dollars. We are not going to risk the disgust of our country and our customers all over the world because of something like that. We will lose all our business. I’m not going to take that risk.”

The public battle over Huawei’s image

The sheer number of fronts on which the U.S. federal government is currently engaging with Huawei, sometimes very aggressively, is notable.

The most high-profile of these is a federal indictment of the company naming its Chief Financial Officer, Meng Wanzhou, in an alleged scheme to deceive U.S. officials in order to bypass U.S. sanctions on Iran. Meng was arrested in Canada at the request of U.S. prosecutors, and the Justice Department is seeking her extradition in order to have her face trial in New York. At the same time, a second federal indictment accusing the company of stealing trade secrets, was unsealed in the state of Washington.

It is the Meng case that President Trump has suggested he might use as leverage in ongoing trade talks. Speaking to reporters at the White House last month, he said, “We’re going to be discussing all of that during the course of the next couple of weeks. We’ll be talking to the U.S. attorneys. We’ll be talking to the attorney general. We’ll be making that decision. Right now, it’s not something we’ve discussed.”

There have also been active efforts to dissuade other countries from doing business with Huawei.

Last month, Secretary of State Mike Pompeo warned U.S. allies that if they use Huawei telecommunications equipment in their critical infrastructure, they will lose access to some intelligence collected by the United States “If a country adopts this and puts it in some of their critical information systems, we won’t be able to share information with them, we won’t be able to work alongside them,” Pompeo said in an interview with Fox Business Network.

On March 8, the U.S. Ambassador to Germany sent a letter to the German minister for economic affairs, reiterating the U.S. government’s concern about the potential for backdoors in Huawei systems and the threat of tampering during complex software updates. He said that U.S. intelligence sharing would be significantly scaled back if Germany uses Huawei products in its new telecommunications systems.

In February, the U.S. government sent a large delegation to MWC Barcelona, the telecommunications industry’s biggest trade show, where they publicly excoriated the company as “duplicitous and deceitful.” The U.S. delegation included officials from the departments of State, Commerce, and Defense, as well as Federal Communications Commission Chairman Ajit Pai. Also there were officials from the U.S. Agency for International Development, who made it clear that foreign aid dollars from the U.S. will not be available to help fund purchases from Chinese telecom firms.

In addition, a law signed by President Trump last year bars the federal government from buying equipment from Huawei and smaller Chinese telecom company ZTE. Trump has additionally floated the possibility of an executive order that would block Huawei from any participation at all in U.S 5G networks.

Huawei is fighting back, filing a lawsuit this month that claims it was unfairly banned from U.S. government computer networks. Deng Cheng, a senior research fellow at The Heritage Foundation in Washington, said the lawsuit may be aimed at determining what information the U.S. government is using to make its case.

 “There is information that the intelligence community may have that isn’t necessarily going to be made public,” he said. “What is admissible in court is not always the same as the information that is actually available. So I’m not really sure how this court case will even be adjudicated.”

Huawei’s lawsuit is likely also partly aimed at improving the firm’s reputation at a time when it is under siege by American officials.

The risk of pushback from China

At a time when the United States relations with even its closest traditional allies is under strain, Washington’s seemingly unilateral demand that a major global supplier be effectively shut out of an enormous marketplace is an audacious request.

For one thing, it is complicated by the fact that for countries and companies anxious to take advantage of 5G wireless technology, there may not be a ready substitute for the Chinese firm.

This seems to be reflected in recent reports that U.S. allies, in Europe, India, the United Arab Emirates and elsewhere, are showing real resistance to U.S, demands. A report in the New York Times late Sunday said that in Europe, the general sense is that any risk posed by Huawei is manageable through monitoring and selective use of the company’s products. The story noted that German Chancellor Angela Merkel’s response to the U.S. was a terse message that Germans would be “defining our standards for ourselves.”

And of course, there is always the possibility — even the likelihood — of Chinese retaliation against countries that accede to the United States’ requests. And in China, where the media is largely controlled by the Communist Party, and access to international news services is sharply limited, that retaliation would likely have widespread public support.

“The very strong perception is that Huawei is a great Chinese company that has done extraordinary things to move to the global frontier, in some respects to the head of the pack, and it is being unfairly treated and held back by the United States for specious reasons,” said Lester Ross, the partner-in-charge of the Beijing office of U.S. law firm Wilmer Hale.

 
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U.S. President Donald Trump is attacking General Motors, the country’s biggest automaker, for costing 5,400 factory workers their jobs when it closed a manufacturing plant where it built a compact model car that Americans were increasingly not interested in buying.

Trump said on Twitter he talked with Mary Barra, GM’s chief executive, on Sunday, telling her he was “not happy” that the automaker closed the manufacturing plant in the industrial heartland of the country in Lordstown, Ohio, where GM manufactured the Chevrolet Cruze, a smaller car the company says is still popular overseas but not in the U.S.

He said he was miffed that the Lordstown plant was closed earlier this month “when everything else in our Country is BOOMING. I asked her to sell it or do something quickly.”

The plant closure was an indication that prosperity is uneven geographically across the U.S., the world’s largest economy.

But with Trump facing several investigations surrounding his 2016 presidential campaign and his actions during the first 26 months of his presidency, he is counting on the country’s mostly robust economy as a key talking point to voters that he should be re-elected to another four-year term in the November 2020 election.

He wrote on Twitter that he is not happy about the closure.

Trump on Monday tweeted that GM, the fourth biggest automaker in the world, and the UAW are opening negotiations on a new contract in September and October.

But he demanded, “Why wait, start them now! I want jobs to stay in the U.S.A. and want Lordstown (Ohio), in one of the best economies in our history, opened or sold to a company who will open it up fast!”

About 4,500 workers at the Lordstown plant lost their jobs over the last two years as sales of the Cruze model declined sharply, along with another 900 at nearby car parts suppliers.

A small portion of the laid-off workers have found jobs at other GM plants far from the Ohio plant that was closed.

Some of the unemployed workers have sought retraining for new jobs, but often found their years of work on a manufacturing assembly line do not readily translate into the ability to handle jobs where newer technology-related skills are needed.

Annual sales of the Cruze in North America peaked at 273,000 in 2014, but last year totaled just 142,000, as Americans are buying fewer passenger cars and instead opting to purchase bigger sport utility vehicles or pickup trucks.

Even as it closed the Lordstown plant, GM is continuing to manufacture the Cruze model in Mexico, Argentina and China, where the wages it pays workers are substantially less than the wages it was paying the Lordstown employees.

GM says Cruze sales in foreign countries have remained stable, fallen less sharply than in the U.S.. or even increased, as is the case in South America.
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Oil producer group OPEC on Monday scrapped its planned meeting in April and will decide instead whether to extend output cuts in June, once the market has assessed the impact of U.S. sanctions on Iran and the crisis in Venezuela.

A ministerial panel of OPEC and its allies recommended that they cancel the extraordinary meeting scheduled for April 17-18 and hold the next regular talks on June 25-26.

The energy minister of OPEC’s de facto leader, Saudi Arabia, said the market was looking oversupplied until the end of the year but that April would be too early for any decision on output policy.

“The consensus we heard… is that April will be premature to make any production decision for the second half,” the Saudi minister, Khalid al-Falih, said.

“As long as the levels of inventories are rising and we are far from normal levels, we will stay the course, guiding the market towards balance,” he added.

The United States has been increasing its own oil exports in recent months while imposing sanctions on OPEC members Venezuela and Iran in an effort to reduce those two countries’ shipments to global markets.

Washington’s policies have introduced a new level of complication for the Organization of the Petroleum Exporting Countries as it struggles to predict global supply and demand.

“We are not under pressure except by the market,” Falih told reporters before the Joint Ministerial Monitoring Committee (JMMC) meeting in the Azeri capital, Baku, when asked whether he was under U.S. pressure to raise output.

U.S. President Donald Trump has been a vocal critic of OPEC, blaming it for high oil prices.

Trump’s sanctions policies have been the key factor behind a price rally, many OPEC members say, having removed more than 2 million barrels per day (bpd) of Iranian and Venezuelan crude from the market.

Brent oil prices hit a 2019 peak above $68 per barrel last week. Saudi Arabia needs a price of around $85 per barrel to balance its budget.

OPEC and its allies agreed in December to cut output by 1.2 million bpd — 1.2 percent of global demand — during the first half of this year in an effort to boost prices.

The JMMC, which also includes non-OPEC Russia, monitors the oil market and conformity with supply cuts.

Asked if he had been updated on whether Washington would extend its waivers for buyers of Iranian crude, which are due to end in May, Falih said: “Until we see it hurting consumers, until we see the impact on inventory, we are not going to change course.”

Inventory levels and oil investments are the two main factors guiding OPEC’s action, Falih said, adding that oil industry estimates show that $11 trillion of investments will be needed over the coming two decades to meet demand growth.

Oil inventories in developed countries continue to fluctuate, he said.

“Our goal is to bring global inventory levels down to more normal levels — and even more importantly, to proactively protect against a glut,” he said.

“Another important metric is the state of oil investments… we are not seeing an investment trend that will get us even closer to the required figures.”

 
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British Prime Minister Theresa May was making a last-minute push Monday to win support for her European Union divorce deal, warning opponents that failure to approve it would mean a long — and possibly indefinite — delay to Brexit.

Parliament has rejected the agreement twice, but May aims to try a third time this week if she can persuade enough lawmakers to change their minds. Her aim is to have the deal agreed before EU leaders meet Thursday for a summit in Brussels.

But there was no sign of a breakthrough, and the government faces a deadline of the end of Tuesday to decide whether they have enough votes to pass the deal, so that a vote can be held on Wednesday.

May’s spokesman, James Slack, said Monday that the government would only hold a vote if there is “a realistic prospect of success.”

May is likely to ask for a delay to Brexit at the Brussels summit. If a deal is approved, she says she will ask the EU to extend the deadline until June 30 so that Parliament has time to approve the necessary legislation. If it isn’t, she will have to seek a longer extension that would mean Britain participating in May 23-26 elections for the European Parliament — something the government is keen to avoid.

May’s goal is to win over Northern Ireland’s small, power-brokering Democratic Unionist Party. The DUP’s 10 lawmakers prop up May’s Conservative government, and their support could influence pro-Brexit Conservatives to drop their opposition to the deal.

Still, May faces a struggle to reverse the huge margins of defeat for the agreement in Parliament. It was rejected by 230 votes in January and by 149 votes last week.

Influential Conservative Brexiteer Jacob Rees-Mogg said he would wait to see what the DUP decided before making up his mind on whether to support May’s deal.

“No deal is better than a bad deal, but a bad deal is better than remaining in the European Union,” he told LBC radio.

British Foreign Secretary Jeremy Hunt said Monday he saw “cautious signs of encouragement” that the deal might make it through Parliament this week.

After months of political deadlock, British lawmakers voted last week to seek to postpone Brexit. That will likely avert a chaotic British withdrawal on the scheduled exit date of March 29 — although the power to approve or reject a Brexit extension lies with the EU, whose leaders are fed up with British prevarication.

EU leaders say they will only grant it if Britain has a solid plan for what to do with the extra time.

“We have to know what the British want: How long, what is the reason supposed to be, how it should go, what is actually the aim of the extension?” German Foreign Minister Heiko Maas told reporters in Brussels. “The longer it is delayed, the more difficult it will certainly be.”

Belgian Foreign Minister Didier Reynders agreed, saying: “We are not against an extension in Belgium, but the problem is — to do what?”

Opposition to May’s deal centers on a measure designed to ensure there is no hard border between the U.K.’s Northern Ireland and EU member Ireland after Brexit.

The mechanism, known as the backstop, is a safeguard that would keep the U.K. in a customs union with the EU until a permanent new trading relationship is in place. Brexit supporters in Britain fear the backstop could be used to bind the country to EU regulations indefinitely, and the DUP fears it could lead to a weakening of the bonds between Northern Ireland and the rest of the U.K.

Talks between the government and the DUP are aimed at reassuring the party that Britain could not be trapped in the backstop indefinitely.

May said in an article for the Sunday Telegraph that failure to approve the deal meant “we will not leave the EU for many months, if ever.”

“The idea of the British people going to the polls to elect MEPs (Members of the European Parliament) three years after voting to leave the EU hardly bears thinking about,” she wrote.

But May suffered a setback Monday when former Foreign Secretary Boris Johnson refused to support her deal.

Johnson, a staunch Brexiteer, used his column in the Daily Telegraph to argue that the backstop left the U.K. vulnerable to “an indefinite means of blackmail” by Brussels.
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After wrapping up thousands of town hall meetings, France starts a new chapter of its “great debate,” aimed to address longstanding public grievances and offer solutions to the yellow vest protest movement.

But the broader crisis lingers, seen with upsurge of violence in Paris Saturday, where about 10,000 yellow vests marked their 18th straight week of protests.

Demonstrators smashed and looted businesses on the iconic Champs Elysees and hurled cobble stones at police, who responded with tear gas and water cannons. Others participated in a peaceful climate march that brought together tens of thousand of people—underscoring the diffuse, unorganized complexity of the leaderless protest movement.

Eight weeks of citizen debates, launched in January by an embattled President Emmanuel Macron, have received mixed reviews. Some consider them a groundbreaking experiment in participative democracy. Others dismiss them as a public relations stunt.

The bigger question is whether and how Macron’s centrist government plans to transform the public feedback into tangible policy change that can address pent-up resentments and find an exit to the unrest.

“The problems start now” said analyst Jean Petaux of Sciences-Po Bordeaux University. “To totally finish with the yellow vests, the government has to address at least part of their demands, which are very disparate. And give the sense it is offering credible solutions.”

For Macron, the immediate takeaways have been largely positive. Up to half-a-million French participated in 10,000 town-hall-style meetings nationwide that tackled pre-set topics, ranging from taxes and pubic services, to democracy and the environment. Organizers also received more than 1.4 million online comments outlining other issues of public concern, including jobs and immigration.

“People are learning that politics and how to change a system is a very difficult process,” said Bernard Reber, an expert on participative citizenship at the Paris-based National Center for Scientific Research, citing one early achievement.

A mixed review

The debates have also given the president and his government some breathing room — time that will last through the current “phase two,” which ends in April. Citizens are being randomly selected to participate in regional meetings aimed to prioritize the myriad demands.

Surveys show the majority of French have broadly given the national debates a thumbs up. More than eight in 10 respondents said the meetings gave citizens an opportunity to express themselves, while smaller majorities said they addressed their personal problems and those aired by the yellow vests, according to a Harris Interactive-Agence Epoka poll published this week, echoing others.

But many appear skeptical that all the talking will amount to much. Another survey found roughly two-thirds doubt the government will ultimately take the public feedback into account.

France’s leading Le Monde newspaper, however, gave the effort a careful, initial thumbs up. Critics who dismissed the debates as a diversion “were misguided,” it wrote in an editorial, while the yellow vests “were eclipsed and marginalize by this exercise in democracy.”

“Macron has not yet won,” it added, “he needs to show he hasn’t just listened but heard the country.”

Government members insist that will happen.

“The idea we have to do things differently is obvious,” Territorial Collectives Minister Sebastien Lecornu, who helped to organizing the debates, told the weekly Le Journal du Dimanche. “We may beef up certain themes, accelerate or correct others.”

But Prime Minister Edouard Philippe offered a more cautionary note, those expecting a flurry of government measures emerging from the debates were misguided.

The months of yellow vest protests have slowed Macron’s reformist agenda. The protest movement, named after the fluorescent jackets French keep in their cars, has morphed well beyond its initial opposition to a planned fuel tax hike, to embrace a hodgepodge of grievances of a largely rural and working class France left behind.

The French president took an initial step back by repealing the fuel tax increase. Then in December, he went further, announcing billions of dollars of aid for the most vulnerable and laying out plans the debates. Yellow vests dismissed the announcements as insufficient, the most extreme calling for Macron’s resignation.

“Emmanuel Macron now has to show that his statements — that there is a before and and after the yellow vests — are translated into acts,” says analyst Petaux. “Otherwise, it’s just talk.”

The next step?

So far, there are at least stylistic changes. Often dismissed as arrogant and aloof, Macron has rolled up his sleeves — literally — and participated in roughly a dozen public debates, in a style reminiscent of his presidential campaign.

Political opponents grumble the French leader has hogged media coverage ahead of May European Parliament elections. And indeed, polls show Macron’s approval rating jumped eight points by early March, to reach 28 percent, and his Republic on the March party inching up to overtake the far-right opposition National Rally.

Still, some observers note the debates ultimately involved only a small slice of the population — including many elderly, with time on their hands. “The great majority of French stayed home,” said analyst Petaux. “It’s not that they were sidelined. It’s that they don’t care. They have other things to do.”

But analyst Reber, who attended roughly 30 of the town hall meetings, believes the debates should not be underestimated. “They’ve been unprecedented in every sense,” he said.

A few months ago, he said, many would have dismissed the idea that French would show up and hash out often deeply divisive issues. “But that’s not been the case,” Reber added. “People mobilized — and stayed for a long time. I don’t know many countries in the world that allow citizens to participate in hours-long debates.”

Macron is expected to announce the after-debate roadmap next month. So far, the French president has given little indication of his long-term exit strategy. Some believe he doesn’t yet have one.

 “I’m not sure the government has a clear idea of what it’s going to do with this mass of information” Reber said. “But it has all kinds of options.

A referendum may be the most obvious path, many analysts say. But it carries risks — not only in terms timing, notably whether to schedule such a vote during May European Parliament elections — but also the chance French may vote against it.

The next steps for the yellow vests are also unclear. A number of analysts believe the movement will slowly die out.

Some diehards will likely continue and harden the protests, Petaux believes, while another group will be absorbed into existing politics parties — mostly on the far right and far left.

A third “will relive the nostalgia of the Republic of roundabouts,” he said, remembering the solidarity and friendships struck during the protests.
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British Prime Minister Theresa May warned Sunday that it would be “a potent symbol of Parliament’s collective political failure” if a Brexit delay meant that the U.K. has to take part in May’s European elections — almost three years after Britons voted to leave the bloc.

Writing in the Sunday Telegraph, May also cautioned that if lawmakers failed to back her deal before Thursday’s European Council summit, “we will not leave the EU for many months, if ever.”

 

“If the proposal were to go back to square one and negotiate a new deal, that would mean a much longer extension… The idea of the British people going to the polls to elect MEPs [Members of the European Parliament] three years after voting to leave the EU hardly bears thinking about,” she wrote.

 

May is expected to try to win Parliament’s approval of her withdrawal agreement for the third time this week. After months of political deadlock, lawmakers voted on Thursday to seek to postpone Brexit.

 

That will likely avert a chaotic withdrawal on the scheduled exit date of March 29 — though power to approve or reject an extension lies with the EU. The European Commission has said the bloc would consider any request, “taking into account the reasons for and duration of a possible extension.”

 

By law, Britain is due to leave the EU on March 29, with or without a deal, unless it cancels Brexit or secures a delay.

 

May is trying to persuade opponents in her Conservative Party and its parliamentary allies to support the withdrawal agreement, which Parliament has already resoundingly defeated twice.

 

Opposition Labour leader Jeremy Corbyn said Sunday his party is against May’s deal — but indicated that it would back an amendment that supports the deal on condition it is put to a new referendum.

 

Corbyn has written to lawmakers across the political spectrum inviting them for talks to find a cross-party compromise.

 

He also told Sky News that he may propose another no-confidence vote in the government if May’s deal is voted down again.
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Brazil is considering granting an import quota of 750,000 metric tons of U.S. wheat per year without tariffs in exchange for other trade concessions, according to a Brazilian official with knowledge of the negotiations ahead of President Jair Bolsonaro’s visit to Washington. 

That is about 10 percent of Brazilian annual wheat imports and is part of a two-decade-old commitment to import 750,000 metric tons of wheat a year free of tariffs that Brazil made — but never kept — during the World Trade Organization’s Uruguay Round of talks on agriculture. 

Bolsonaro is scheduled to arrive in Washington on Sunday and meet with U.S. President Donald Trump at the White House on Tuesday.

Farm state senators have asked that wheat sales be on the agenda, in a letter to Trump seen by Reuters. They estimate such a quota would increase U.S. wheat sales by between $75 million and $120 million a year. 

Brazil buys most of its imported wheat from Argentina, and some from Uruguay and Paraguay, without paying tariffs because they are all members of the Mercosur South American customs union. Imports from other countries pay a 10 percent tariff. 

The Brazilian official, who asked not to be named so he could speak freely, said the wheat quota could be sealed during a meeting between Brazil’s Agriculture Minister Teresa Cristina Dias and U.S. Secretary of Agriculture Sonny Perdue on Tuesday. 

In return, the Brazilian government is hoping to see movement toward the reopening of the U.S. market to fresh beef imports from Brazil that was shut down after a meatpacking industry scandal involving bribed inspectors. 

Brazil is also seeking U.S. market access for its exports of limes that are facing phytosanitary certification hurdles. 

The world’s largest sugar producer also wants tariff-free access to the U.S. market. But Washington is not expected to budge on that issue until Brazil lifts a tariff it slapped on ethanol imports when they exceed 150 million liters in a quarter. 

That is a major demand by U.S. biofuels producers, who are the main suppliers of ethanol imported by Brazil. 
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Brazil is considering granting an import quota of 750,000 metric tons of U.S. wheat per year without tariffs in exchange for other trade concessions, according to a Brazilian official with knowledge of the negotiations ahead of President Jair Bolsonaro’s visit to Washington. 

That is about 10 percent of Brazilian annual wheat imports and is part of a two-decade-old commitment to import 750,000 metric tons of wheat a year free of tariffs that Brazil made — but never kept — during the World Trade Organization’s Uruguay Round of talks on agriculture. 

Bolsonaro is scheduled to arrive in Washington on Sunday and meet with U.S. President Donald Trump at the White House on Tuesday.

Farm state senators have asked that wheat sales be on the agenda, in a letter to Trump seen by Reuters. They estimate such a quota would increase U.S. wheat sales by between $75 million and $120 million a year. 

Brazil buys most of its imported wheat from Argentina, and some from Uruguay and Paraguay, without paying tariffs because they are all members of the Mercosur South American customs union. Imports from other countries pay a 10 percent tariff. 

The Brazilian official, who asked not to be named so he could speak freely, said the wheat quota could be sealed during a meeting between Brazil’s Agriculture Minister Teresa Cristina Dias and U.S. Secretary of Agriculture Sonny Perdue on Tuesday. 

In return, the Brazilian government is hoping to see movement toward the reopening of the U.S. market to fresh beef imports from Brazil that was shut down after a meatpacking industry scandal involving bribed inspectors. 

Brazil is also seeking U.S. market access for its exports of limes that are facing phytosanitary certification hurdles. 

The world’s largest sugar producer also wants tariff-free access to the U.S. market. But Washington is not expected to budge on that issue until Brazil lifts a tariff it slapped on ethanol imports when they exceed 150 million liters in a quarter. 

That is a major demand by U.S. biofuels producers, who are the main suppliers of ethanol imported by Brazil. 
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Iranian Oil Minister Bijan Zanganeh said on Saturday that frequent U.S. comments about oil prices had created market tensions, the ministry’s news website SHANA reported. 

U.S. President Donald Trump, who has made the U.S. economy one of his top issues, has repeatedly tweeted about oil prices and the Organization of the Petroleum Producing Countries. He has expressed concern about higher prices, including last month and ahead of OPEC’s meeting in December.

“Americans talk a lot and I advise them to talk less. They [have] caused tensions in the oil market for over a year now, and they are responsible for it, and if this trend continues, the market will be more tense,” SHANA quoted Zanganeh as saying. 

U.S. crude futures briefly hit a 2019 high on Friday but later retreated along with benchmark Brent oil as worries about the global economy and robust U.S. production put a brake on prices. 

OPEC and its allies including Russia, an alliance known as OPEC+, agreed last year to cut production, partly in response to increased U.S. shale output.

Washington granted waivers to eight major buyers of Iranian oil after the U.S. reimposed sanctions on Iran’s oil sector in November, after withdrawing from the 2015 Iran nuclear deal. 

“We do not know whether U.S. waivers would be extended or not. We will do our job but they [the U.S.] say something new every single day,” Zanganeh said. 

South Pars

Zanganeh was speaking at a news conference ahead of the planned inauguration on Sunday of four development phases at South Pars, the world’s largest gas field, by President Hassan Rouhani. 

He said Iran had invested $11 billion to complete the phases 13 and 22-24 of the giant field, which Tehran shares with Qatar, and expected to operate 27 phases by next March, SHANA reported. 

France’s Total and China National Petroleum Corp suspended investment in phase 11 of South Pars last year after the United States threatened to impose sanctions on companies that do business in Iran. 

But Zanganeh said talks with CNPC were continuing. 

“Negotiations are ongoing. A senior delegation from China is due to come to Iran for talks. They have promised to come to Iran soon,” said Zanganeh, according to the semiofficial news agency ISNA. 
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Iranian Oil Minister Bijan Zanganeh said on Saturday that frequent U.S. comments about oil prices had created market tensions, the ministry’s news website SHANA reported. 

U.S. President Donald Trump, who has made the U.S. economy one of his top issues, has repeatedly tweeted about oil prices and the Organization of the Petroleum Producing Countries. He has expressed concern about higher prices, including last month and ahead of OPEC’s meeting in December.

“Americans talk a lot and I advise them to talk less. They [have] caused tensions in the oil market for over a year now, and they are responsible for it, and if this trend continues, the market will be more tense,” SHANA quoted Zanganeh as saying. 

U.S. crude futures briefly hit a 2019 high on Friday but later retreated along with benchmark Brent oil as worries about the global economy and robust U.S. production put a brake on prices. 

OPEC and its allies including Russia, an alliance known as OPEC+, agreed last year to cut production, partly in response to increased U.S. shale output.

Washington granted waivers to eight major buyers of Iranian oil after the U.S. reimposed sanctions on Iran’s oil sector in November, after withdrawing from the 2015 Iran nuclear deal. 

“We do not know whether U.S. waivers would be extended or not. We will do our job but they [the U.S.] say something new every single day,” Zanganeh said. 

South Pars

Zanganeh was speaking at a news conference ahead of the planned inauguration on Sunday of four development phases at South Pars, the world’s largest gas field, by President Hassan Rouhani. 

He said Iran had invested $11 billion to complete the phases 13 and 22-24 of the giant field, which Tehran shares with Qatar, and expected to operate 27 phases by next March, SHANA reported. 

France’s Total and China National Petroleum Corp suspended investment in phase 11 of South Pars last year after the United States threatened to impose sanctions on companies that do business in Iran. 

But Zanganeh said talks with CNPC were continuing. 

“Negotiations are ongoing. A senior delegation from China is due to come to Iran for talks. They have promised to come to Iran soon,” said Zanganeh, according to the semiofficial news agency ISNA. 
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Veteran Conservative lawmaker Nigel Evans has been in Britain’s House of Commons for more than a quarter-of-a-century and, like most of his parliamentary colleagues, is stunned at the turn of Brexit events.

“I got elected in 1992 and I don’t know if I have known any time more uncertain than now,” he told VOA.

He’s flummoxed at what the next move should be for a Conservative government that has lost control of the Brexit process.

As a committed Brexiter, he fears Britain will end up staying in the European Union because of an impasse in the Commons that has seen the ruling Conservative government repeatedly rebuffed by lawmakers, including by a third of its own MPs, in a series of historic votes without precedent for the storied House of Commons.

Parliament is not alone in being hopelessly divided: Theresa May’s Cabinet is, too, with the British prime minister lurching between pro-EU rebel ministers and their pro-Brexit counterparts, trying to resuscitate a government that appears to be in terminal decline.

Divorce delayed

More than 20 ministers have resigned in the past two years — and at least another half-dozen are on the cusp of quitting. Midweek another minister resigned and four declined to vote with their own government — an unprecedented defiance left unpunished.

Britain’s newspaper headline writers are running out of superlatives and metaphors to describe the political havoc. “We’re becoming the laughing stock of the World,” fumes Andrew Pierce, the Daily Mail’s associate editor, in College Green, the patch of grass outside parliament which has become a media encampment of tents, wires and cameras besieged by chanting, dueling placard-waving protesters.

Britain was due to exit the EU in 16 days’ time, on March 29.

On Wednesday, the House of Commons voted against Britain exiting the EU without a deal — in effect delaying Brexit until further notice. That followed Tuesday’s crushing parliamentary defeat of Theresa May’s Brexit withdrawal agreement — the second time pro-EU and hardline pro-Brexit lawmakers have combined to reject it. Lawmakers Thursday are expected to pass a measure seeking formally to delay Brexit, at least to June 30. EU leaders are divided about accepting a request for delay.

Donald Tusk, the president of the EU Council, tweeted Thursday: “I will appeal to the EU27 to be open to a long extension if the UK finds it necessary to rethink its #Brexit strategy and build consensus around it.”

The Remainers hope to either block Brexit altogether or at least steer it in a gentler direction with Britain still closely aligned although not a member of its political institutions. Hardline Brexiters want a no-nonsense sharp break with the EU, ready to accept the economic damage to Britain that will wreak, at least in the medium term.

That Evans feels unable to predict what happens next is instructive. He is no junior lawmaker, but a so-called “Tory grandee”, and he helps to direct the 1922 Committee, of which all backbench Conservative lawmakers are members.

When the bosses of the 1922 Committee tell a Conservative leader to quit, their word has the force of the Lord High Executioner. The last time the 22, as its nicknamed, deposed a party leader was in 2003, ousting one of Theresa May’s predecessors for losing a general election.

Are they close to giving May the push now? Evans is guarded but makes little secret he thinks the time is close at hand. “Her authority is greatly weakened,” he says grimly.

Replacing May

Pro-Brexit Conservative bloggers and columnists are in vituperative mood, blaming May for mishandling the negotiations with the EU and, from their viewpoint, giving too much ground to Brussels. Gridlock has been the result, they say.

“I can see no scenario where she is the answer for taking the country forward. She should by rights go now. At some point in the next two or three weeks it will even dawn on Mrs. May that it is time to go,” Conservative blogger Iain Dale tells VOA.

WATCH:  British Leadership Change Possible in Wake of Brexit Chaos

Then what?

The vultures are circling. Half-a-dozen would-be replacements from inside May’s Cabinet have in effect been auditioning already for the job, delivering speeches carving out their vision for the country. Some contenders have advanced plans, including printing up campaign material for what they expect is an inevitable leadership election.

A Conservative grassroots favorite, Boris Johnson, the former foreign minister, has had a modern makeover and dispensed with his trademark tousle-haired slapdash look and is now sporting a stylish boyband haircut.

But it is not clear that replacing Theresa May will solve anything or break the political impasse, which is why the 1922 Committee has stayed its hand.

There is no obvious unity candidate to succeed her. A new leader will face the same splits inside the Conservative party between Remainers, Brexiters and the those who favor a so-called soft Brexit modeled on Norway’s relationship with the EU, which would see Britain remain in the bloc’s single market and customs union as well as accept freedom of movement.

And the deadlocked parliamentary arithmetic will remain the same.

Another try

In a final throw of the dice, May is planning to bring her contentious deal back to the Commons for a third time, hoping that she will prevail by sheer persistence. It is the continuation of her strategy of brinkmanship — to run the clock down and force Conservative Brexiters and a handful of allied Northern Irish lawmakers to give in, prompted to do so by the fear that otherwise Britain might never leave the EU in any form.

It is not clear that the pro-EU Speaker of the House, John Bercow, will allow her to do so — under parliamentary rules a government is not meant to keep asking the House to vote repeatedly on the same measure. “If she can pull it off, it will be the political equivalent of Lazarus rising from the dead,” admits a Downing Street official.

Some believe she has a chance of succeeding in this high-stakes game of chicken. Evans does not think so. “For some of the rebels it would be better to stay in the EU than accept this deal, which would have us at the beck and call of Brussels without any power,” he says. Another key Brexiter, Steve Barclay, says he and many of his colleagues will keep voting the deal down “whatever the pressure we’re put under.”

Keeping calm and carrying on?

Beyond Westminster, there is fear, exasperation and anger. And clear Brexit fatigue. BBC Radio Five Live has seen the volume of Brexit-related call-ins tail off recently. There are signs, according to some opinion polls, that the mood of the country may have shifted slightly in favor of remaining in the EU, suggesting that a second referendum would deliver a narrow win for Remain.

As yet there is no majority in the House of Commons for holding a re-run referendum. Nor are lawmakers keen on holding a snap general election, for fear that might result in an equally deadlocked parliament afterwards.

Business leaders were already fuming at all the Brexit uncertainty before this week’s upheaval. “Enough is enough. A new approach is needed by all parties. Jobs and livelihoods depend on it,” said Carolyn Fairbairn, the director-general of the Confederation of British Industry, a major business association.
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China’s top legislature is expected to pass the country’s first Foreign Investment Law this week at a time when negotiators from Beijing and Washington work to hammer out a trade deal.

Analysts and business groups say the legislation is a step in the right direction, but still falls short. In some ways, they add, it even raises new concerns that negotiators need to address before the two sides reach a deal.

For decades, China has been grappling with the question of just how far and how fast it should open up its state directed economy, and steps — while always welcome — have long lagged behind expectations. The Foreign Investment Law is not different.

In a statement, the American Chamber of Commerce in China (AmCham China) said it welcomes the law and appreciates the effort to improve the investment environment.

“We are concerned, however, that such an important and potentially far-reaching piece of legislation will be enacted without extensive consultation and input from industry stakeholders, including Foreign Invested Enterprises,” the statement said.

An earlier version of the law was put together in 2015, but later stalled during the review process, only to resurface more recently. When it did, the wording was more general and more vague, analysts note. By contrast, the first version had 171 articles, the new one has 41.

This some argue, helped pave the way for the bills speedy passage. NPC Observer, a website that closely follows China’s legislature or National People’s Congress, notes that by keeping the legislation vague, the government will have more room and time to craft implementing regulations after the law is enacted.

“The law is phrased and drafted with very general provisions. There are a number of things that are not covered in there, such as what percentage of foreign investment qualifies as foreign invested,” said Lester Ross, who heads AmCham China’s policy committee. “Another major concern is the requirement for security assessments even for non-mergers and acquisitions, even for greenfield investments, which seems unnecessary.”

Subsidies still an issue

The newer version of the law was fast-tracked as Washington and Beijing work to hammer out a trade deal. While the provisions in the legislation address some persistent concerns, such as forced technology transfers, equal access to government procurement and national treatment, it does not address other issues, such as subsidies for state owned enterprises.

Clearly though, the legislation was pushed through the system in part to address what is being discussed at the negotiation table, said Mats Harborn, president of the European Chamber of Commerce in China.

“It is more than a law, it is a document that states principles and it is a document that states principles that we [foreign investors] would like to hear. And it also states the principles that U.S. negotiators want to have on paper from China,” Harborn said. “But the proof in the pudding will be the implementation.”

National security concerns

And while the law echoes concerns that are part of what trade negotiators are discussing, issues such as the broad application of national security reviews and the mention of national security in the law are cause for concern, argues Austin Lowe, a Washington D.C.-based consultant and analyst.

In a recent article on the legal and national security website Lawfare, Lowe highlighted provisions in the legislation that foreign companies should not “harm national security or the public interest” and that businesses that affect national security should be subject to a review.

“Together, these provisions essentially give the state — and, in turn, the Chinese Communist Party — free rein to intervene in a wide range of investment activity, signaling to foreign investors that they are better off avoiding any investment in an area that may be construed as politically sensitive or threatening,” he wrote.

Ross notes that while security reviews have been in place since 2011, they have, so far, been used very selectively and largely for mergers and acquisitions.

“Now it looks like this is an additional hurdle that will apply across the board,” he said.

While it doesn’t mean that every investment could face such scrutiny, there are no bounds to how it can be applied, and in some cases that would require revealing a company’s intellectual property, Ross added.

“When you put national security into any document it creates a great deal of arbitrary judgement on what is national security and what is not,” notes the EU Chamber of Commerce’s Mats Harborn. “It is a very wide definition that creates uncertainty.”

Not only does it create uncertainty, but the questions the new law raises will add to the issues negotiators will need to resolve going forward, Ross said.

“While on the one hand it is a good thing that they are showing some significant degree of intention to reduce barriers to foreign investment and actually making some substantive changes, once the law is in place it may actually be more difficult to make departures from that in the course of the negotiations,” he said.
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