Starting this month, Chinese fishing vessels are allowed to exploit the open waters off the Somali coast, following the granting of licenses by Somalia’s government last month. Somali authorities say the permits will reduce illegal foreign fishing and help boost the economy.  But Somali fishermen worry the Chinese vessels now have the license to dominate the trade.  Mohamed Sheikh Nor reports from Mogadishu.
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The World Bank is downgrading its outlook for the global economy this year, citing rising trade tension, weakening manufacturing activity and growing financial stress in emerging-market countries.

In a report titled “Darkening Skies,” the anti-poverty agency said Tuesday that it expects the world economy to grow 2.9 percent in 2019, down from the 3 percent it forecast back in June. It would be the second straight year of slowing growth: The global economy expanded 3 percent last year and 3.1 percent in 2017.

‘Risks are rising’

“Global growth is slowing, and the risks are rising,” Ayhan Kose, the World Bank economist who oversees forecasts, said in an interview. “In 2017, the global economy was pretty much firing on all cylinders. In 2018, the engines started sputtering.”

The bank left its forecast for the U.S. economy unchanged at 2.5 percent this year, down from 2.9 percent in 2018. It predicts 1.6 percent growth for the 19 countries that use the euro currency, down from 1.9 percent last year; and 6.2 percent growth for China, the world’s second-biggest economy, versus 6.5 percent in 2018.

The bank upgraded expectations for the Japanese economy, lifting its growth forecast to 0.9 percent, up from 0.8 percent in 2018.

President Donald Trump, declaring that years of U.S. support for free trade had cost America jobs, last year slapped import taxes on foreign dishwashers, solar panels, steel, aluminum and $250 billion in Chinese products. Other countries retaliated with tariffs of their own in disputes that have yet to be resolved.

The exchange of tariffs is taking a toll on world trade. The bank predicts that the growth of world trade will slow to 3.6 percent this year from 3.8 percent in 2018 and 5.4 percent in 2017. Slowing trade is hurting manufacturers around the world.

Rising interest rates

Rising interest rates are also pinching emerging-market governments and companies that borrowed heavily when rates were ultra-low in the aftermath of the 2007-2009 Great Recession. As the debts roll over, those borrowers have to refinance at higher rates. A rising dollar is also making things harder for emerging-market borrowers who took out loans denominated in the U.S. currency.

“Now debt service is eating into government revenues, making it more difficult (for governments) to fund essential social services,” said World Bank CEO Kristalina Georgieva, who will replace bank president Jim Yong Kim on an interim basis when he leaves at the end of January.

The bank slashed its forecast for 2019 growth for Turkey, Argentina, Iran and Pakistan, among others.
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The World Bank is downgrading its outlook for the global economy this year, citing rising trade tension, weakening manufacturing activity and growing financial stress in emerging-market countries.

In a report titled “Darkening Skies,” the anti-poverty agency said Tuesday that it expects the world economy to grow 2.9 percent in 2019, down from the 3 percent it forecast back in June. It would be the second straight year of slowing growth: The global economy expanded 3 percent last year and 3.1 percent in 2017.

‘Risks are rising’

“Global growth is slowing, and the risks are rising,” Ayhan Kose, the World Bank economist who oversees forecasts, said in an interview. “In 2017, the global economy was pretty much firing on all cylinders. In 2018, the engines started sputtering.”

The bank left its forecast for the U.S. economy unchanged at 2.5 percent this year, down from 2.9 percent in 2018. It predicts 1.6 percent growth for the 19 countries that use the euro currency, down from 1.9 percent last year; and 6.2 percent growth for China, the world’s second-biggest economy, versus 6.5 percent in 2018.

The bank upgraded expectations for the Japanese economy, lifting its growth forecast to 0.9 percent, up from 0.8 percent in 2018.

President Donald Trump, declaring that years of U.S. support for free trade had cost America jobs, last year slapped import taxes on foreign dishwashers, solar panels, steel, aluminum and $250 billion in Chinese products. Other countries retaliated with tariffs of their own in disputes that have yet to be resolved.

The exchange of tariffs is taking a toll on world trade. The bank predicts that the growth of world trade will slow to 3.6 percent this year from 3.8 percent in 2018 and 5.4 percent in 2017. Slowing trade is hurting manufacturers around the world.

Rising interest rates

Rising interest rates are also pinching emerging-market governments and companies that borrowed heavily when rates were ultra-low in the aftermath of the 2007-2009 Great Recession. As the debts roll over, those borrowers have to refinance at higher rates. A rising dollar is also making things harder for emerging-market borrowers who took out loans denominated in the U.S. currency.

“Now debt service is eating into government revenues, making it more difficult (for governments) to fund essential social services,” said World Bank CEO Kristalina Georgieva, who will replace bank president Jim Yong Kim on an interim basis when he leaves at the end of January.

The bank slashed its forecast for 2019 growth for Turkey, Argentina, Iran and Pakistan, among others.
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Peru Attorney General Pedro Chavarry resigned on Tuesday after a public outcry over his handling of the high-profile corruption investigation involving Brazilian builder Odebrecht.

His departure from the public prosecutors office marks a fresh victory for President Martin Vizcarra and supporters of his measures to uproot entrenched corruption in one of Latin America’s fastest-growing economies.

Chavarry prompted widespread scorn and days of street protests after he announced on New Year’s Eve that he was removing two lead prosecutors from the Odebrecht inquiry, which has targeted former presidents and presidential candidates.

Vizcarra responded by sending Congress legislation to suspend Chavarry and overhaul the prosecutor’s office.

Resignation protects prosecutor?

Chavarry denied he was trying to meddle in the investigation and said he was stepping down to protect the independence of the prosecutor’s office, which he portrayed in his resignation letter as under attack by Vizcarra’s government.

Vizcarra had repeatedly called for Chavarry to step down since he was appointed by a panel of prosecutors in July despite his ties to an alleged criminal group of judges, lawmakers and businessmen. Chavarry was later named by a prosecutor in his office as a suspect in the probe. He denies wrongdoing.

A former vice president, Vizcarra has made fighting corruption a focus of his government since taking office last year to replace Pedro Pablo Kuczynski, who stepped down in one of several graft scandals to grip Peru in recent years.

Vizcarra, however, lacked the authority to dismiss Chavarry. Under Peru’s constitution, only Congress, where Chavarry enjoyed support with the opposition majority, can oust the attorney general.

Avalos is acting attorney general

Supreme Prosecutor Zoraida Avalos, one of several prominent prosecutors to call for Chavarry to resign in the past week, was named as acting attorney general on Tuesday.

The prosecutors whom Chavarry had dismissed last week — Rafael Vela and Jose Domingo Perez — were reinstated amid the outcry.

The two are seen as pivotal figures in the Odebrecht investigation and recently drew up a plea deal that commits the company to providing evidence on about $30 million in bribes it acknowledges it paid to local politicians.

‘Car Wash’ probe

Odebrecht is at the center of the “Car Wash” investigation in Brazil, which has rippled across Latin America and which U.S. prosecutors have said is the biggest political graft scheme ever uncovered.

In late 2016, Odebrecht acknowledged it had paid millions of dollars in bribes to officials in a dozen countries to secure public works contracts dating back over a decade. The company has committed to paying billions of dollars in fines.
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Peru Attorney General Pedro Chavarry resigned on Tuesday after a public outcry over his handling of the high-profile corruption investigation involving Brazilian builder Odebrecht.

His departure from the public prosecutors office marks a fresh victory for President Martin Vizcarra and supporters of his measures to uproot entrenched corruption in one of Latin America’s fastest-growing economies.

Chavarry prompted widespread scorn and days of street protests after he announced on New Year’s Eve that he was removing two lead prosecutors from the Odebrecht inquiry, which has targeted former presidents and presidential candidates.

Vizcarra responded by sending Congress legislation to suspend Chavarry and overhaul the prosecutor’s office.

Resignation protects prosecutor?

Chavarry denied he was trying to meddle in the investigation and said he was stepping down to protect the independence of the prosecutor’s office, which he portrayed in his resignation letter as under attack by Vizcarra’s government.

Vizcarra had repeatedly called for Chavarry to step down since he was appointed by a panel of prosecutors in July despite his ties to an alleged criminal group of judges, lawmakers and businessmen. Chavarry was later named by a prosecutor in his office as a suspect in the probe. He denies wrongdoing.

A former vice president, Vizcarra has made fighting corruption a focus of his government since taking office last year to replace Pedro Pablo Kuczynski, who stepped down in one of several graft scandals to grip Peru in recent years.

Vizcarra, however, lacked the authority to dismiss Chavarry. Under Peru’s constitution, only Congress, where Chavarry enjoyed support with the opposition majority, can oust the attorney general.

Avalos is acting attorney general

Supreme Prosecutor Zoraida Avalos, one of several prominent prosecutors to call for Chavarry to resign in the past week, was named as acting attorney general on Tuesday.

The prosecutors whom Chavarry had dismissed last week — Rafael Vela and Jose Domingo Perez — were reinstated amid the outcry.

The two are seen as pivotal figures in the Odebrecht investigation and recently drew up a plea deal that commits the company to providing evidence on about $30 million in bribes it acknowledges it paid to local politicians.

‘Car Wash’ probe

Odebrecht is at the center of the “Car Wash” investigation in Brazil, which has rippled across Latin America and which U.S. prosecutors have said is the biggest political graft scheme ever uncovered.

In late 2016, Odebrecht acknowledged it had paid millions of dollars in bribes to officials in a dozen countries to secure public works contracts dating back over a decade. The company has committed to paying billions of dollars in fines.
…

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Labor rights campaigners warned against complacency as the European Union on Tuesday withdrew its threat to ban Thai fishing imports into the bloc, saying that the country has made progress in tackling illegal and unregulated fishing.

The EU’s so-called “yellow card” on Thai fishing exports has been in place since April 2015 as a warning that the country was not sufficiently addressing the issues.

“Illegal, unreported and unregulated fishing damages global fish stocks, but it also hurts the people living from the sea, especially those already vulnerable to poverty,” Karmenu Vella, European Commissioner for environment and fisheries said.

“Today’s decision reverses the first step of a process that could have led to a complete import ban of marine fisheries products into the EU,” he said in a statement.

Thailand has amended its fisheries legal framework in line with international law, and improved its monitoring and surveillance systems, including remote monitoring of fishing activities and more robust inspections at port, the EU said.

The country’s multibillion-dollar seafood industry has also come under scrutiny for slavery, trafficking and violence on fishing boats and at onshore processing facilities.

After the EU threatened to ban fish exports, and the U.S. State Department said it was failing to tackle human trafficking, the Southeast Asian country toughened up its laws and increased fines for violations.

Thailand has introduced modern technologies — from satellites to optical scanning and electronic payment services — to crack down on abuses.

But the International Labor Organization said in March that fishermen remained at risk of forced labor, and the wages of some continued to be withheld.

The EU on Tuesday said it recognized efforts by Thailand to tackle human trafficking and to improve labor conditions in the fishing sector.

Thailand voted in December to ratify ILO convention 188 — which sets standards of decent work in the fishing industry — becoming the first Asian country to do so.

But important gaps remain, said Steve Trent, executive director at advocacy group Environmental Justice Foundation.

“We still have concerns about the workers. We need to see that the reforms are durable,” he said.

Thailand is yet to ratify two other ILO conventions on the right to organize and the right to collective bargaining, both of which are essential to protect workers, he told the Thomson Reuters Foundation.

This is particularly important in the fishing and seafood processing industries, as most of their estimated 600,000 workers are migrant workers.

“There is a risk that with the lifting of the yellow card, complacency will set in. We need to see a culture of compliance, and more being done to protect vulnerable workers in the industry,” Trent said.
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Labor rights campaigners warned against complacency as the European Union on Tuesday withdrew its threat to ban Thai fishing imports into the bloc, saying that the country has made progress in tackling illegal and unregulated fishing.

The EU’s so-called “yellow card” on Thai fishing exports has been in place since April 2015 as a warning that the country was not sufficiently addressing the issues.

“Illegal, unreported and unregulated fishing damages global fish stocks, but it also hurts the people living from the sea, especially those already vulnerable to poverty,” Karmenu Vella, European Commissioner for environment and fisheries said.

“Today’s decision reverses the first step of a process that could have led to a complete import ban of marine fisheries products into the EU,” he said in a statement.

Thailand has amended its fisheries legal framework in line with international law, and improved its monitoring and surveillance systems, including remote monitoring of fishing activities and more robust inspections at port, the EU said.

The country’s multibillion-dollar seafood industry has also come under scrutiny for slavery, trafficking and violence on fishing boats and at onshore processing facilities.

After the EU threatened to ban fish exports, and the U.S. State Department said it was failing to tackle human trafficking, the Southeast Asian country toughened up its laws and increased fines for violations.

Thailand has introduced modern technologies — from satellites to optical scanning and electronic payment services — to crack down on abuses.

But the International Labor Organization said in March that fishermen remained at risk of forced labor, and the wages of some continued to be withheld.

The EU on Tuesday said it recognized efforts by Thailand to tackle human trafficking and to improve labor conditions in the fishing sector.

Thailand voted in December to ratify ILO convention 188 — which sets standards of decent work in the fishing industry — becoming the first Asian country to do so.

But important gaps remain, said Steve Trent, executive director at advocacy group Environmental Justice Foundation.

“We still have concerns about the workers. We need to see that the reforms are durable,” he said.

Thailand is yet to ratify two other ILO conventions on the right to organize and the right to collective bargaining, both of which are essential to protect workers, he told the Thomson Reuters Foundation.

This is particularly important in the fishing and seafood processing industries, as most of their estimated 600,000 workers are migrant workers.

“There is a risk that with the lifting of the yellow card, complacency will set in. We need to see a culture of compliance, and more being done to protect vulnerable workers in the industry,” Trent said.
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Forest fires caused by climate change are costing insurers more than ever, with the deadly fire that ravaged northern California the single most expensive natural disaster in 2018, Munich Re said in its catastrophe report Tuesday.

The California wildfire that devastated the small town of Paradise in November caused losses of $16.5 billion, of which $12.5 billion were insured.

Worldwide natural disasters caused $160 billion in economic damage in 2018. That was down from $350 billion the previous year, but a number of devastating hurricanes had contributed to the high losses in 2017.

Insurers and reinsurers paid out $80 billion for natural disaster claims last year, down from $140 billion a year earlier but almost double the 30-year average of $41 billion, the reinsurer said.

Munich Re board member Torsten Jeworrek said that 2018 was marked by several severe natural disasters with high insured losses.

“These include the unusual coincidence of severe cyclones in the U.S. and Japan, and devastating forest fires in California,” he said, adding that climate change appears to be making such large fires more common.

Insurers spent $18 billion on two huge fires in the United States in 2018 — equivalent to one in every four dollars they paid out as a result of natural disasters.

Ernst Rauch, the reinsurer’s chief climatologist, told Reuters that forest fires were entering a whole new dimension, costing tens of billions of dollars.

“Higher and higher temperatures are leading to ever greater droughts, and high humidity in the winter means that shrubbery grows quickly, creating an easily flammable material in dry summers,” he said.

Rauch said it was questionable whether areas at high risk could continue to be populated without taking additional measures, such as building houses farther from forests and with better safety standards.

Reinsurers act as a financial backstop to insurance companies, paying a chunk of the big claims for storms or earthquakes in exchange for part of the policy premiums.

The review gave no claims figures for Munich Re itself. The reinsurer is due to report fourth-quarter results on Feb. 6.
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Forest fires caused by climate change are costing insurers more than ever, with the deadly fire that ravaged northern California the single most expensive natural disaster in 2018, Munich Re said in its catastrophe report Tuesday.

The California wildfire that devastated the small town of Paradise in November caused losses of $16.5 billion, of which $12.5 billion were insured.

Worldwide natural disasters caused $160 billion in economic damage in 2018. That was down from $350 billion the previous year, but a number of devastating hurricanes had contributed to the high losses in 2017.

Insurers and reinsurers paid out $80 billion for natural disaster claims last year, down from $140 billion a year earlier but almost double the 30-year average of $41 billion, the reinsurer said.

Munich Re board member Torsten Jeworrek said that 2018 was marked by several severe natural disasters with high insured losses.

“These include the unusual coincidence of severe cyclones in the U.S. and Japan, and devastating forest fires in California,” he said, adding that climate change appears to be making such large fires more common.

Insurers spent $18 billion on two huge fires in the United States in 2018 — equivalent to one in every four dollars they paid out as a result of natural disasters.

Ernst Rauch, the reinsurer’s chief climatologist, told Reuters that forest fires were entering a whole new dimension, costing tens of billions of dollars.

“Higher and higher temperatures are leading to ever greater droughts, and high humidity in the winter means that shrubbery grows quickly, creating an easily flammable material in dry summers,” he said.

Rauch said it was questionable whether areas at high risk could continue to be populated without taking additional measures, such as building houses farther from forests and with better safety standards.

Reinsurers act as a financial backstop to insurance companies, paying a chunk of the big claims for storms or earthquakes in exchange for part of the policy premiums.

The review gave no claims figures for Munich Re itself. The reinsurer is due to report fourth-quarter results on Feb. 6.
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Mexican President Andres Manuel Lopez Obrador said on Tuesday a military-assisted crackdown had dramatically reduced fuel theft and uncovered a secret pipe that was used to siphon gasoline out of one of the country’s refineries.

Such fuel theft has dropped from 787 truck loads per day to 177 since thousands of soldiers were sent to state-oil company Pemex’s installations last month, Lopez Obrador said at a daily news conference.

The crackdown on years of mounting fuel theft is the leftist government’s first major move against corruption and violence after taking office on December 1, but risks angering consumers and hurting the economy.

By closing off pipelines and refineries while it traced leakages, the government has triggered shortfalls and long lines at gas stations in at least six states, including Guanajuato, a major car-manufacturing hub in central Mexico.

Criminal groups and others who have tapped pipelines have long been blamed for billions of dollars of losses to public coffers over the past few years, but Lopez Obrador said last month that far more fuel was being stolen directly from Pemex installations by an internal network of corrupt officials.

Lopez Obrador said the military had discovered a 3-kilometer (1.9 mile)-long “hose” that was funneling fuel out of storage tanks at the Salamanca refinery in the central state of Guanajuato into a secret storage area.

He admitted there were complaints about the shortages, but said they were not widespread, and urged an end to “panic” buying and said shortages were an issue of distribution, not supply.

“This is not in vain,” Lopez Obrador said. “We are going to end corruption.”

Local media showed images of tanker trucks, escorted by federal police, heading from oil-rich costal states to the country’s interior.

It was not immediately clear what impact the crackdown will have on imports of fuel. Mexico is the top export destination for U.S. energy products, importing about 1.4 million barrels every day, or nearly a quarter of all U.S. overseas sales.
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Hospitals in Zimbabwe are turning away patients as a strike by doctors enters its sixth week. There is no end in sight to the strike, as President Emmerson Mnangagwa’s government says it cannot meet the doctors’ demands.

The Parirenyatwa Group of Hospitals, Zimbabwe’s largest treatment center, is largely empty as a doctors’ strike that began December 1 drags on.

Sixty-nine-year-old Kasirina Zibveka had a lung infection in September, according to her medical records. After numerous tests were done, it was confirmed that her right lung had gone bad and needed to be removed.

 

But by then, doctors were on strike. She was discharged December 13 and was told to return Monday for the ailing lung to be removed. But with the strike unresolved, that did not happen.

 

Her daughter, Margret Chikoti, says the family has paid for her treatment, but only nurses are attending to her mother.

 

“We have no idea what is really happening to her since December 13,” she said. “All we see is her discharging some blood stained stinking fluids [through a hole pierced by nurses under her right breast]. What is happening inside her body? Is it getting worse? We just give her painkillers and use ointment to clean her wound. We hope that their negotiations [doctors and government] bear fruit and they return to work.”

Doctors held a meeting Monday and resolved to remain on strike until their demands are met. The doctors want the government to equip hospitals with modern technology, sufficient medicine and protective clothing for doctors.

 

They also want to be paid in U.S. dollars instead of Zimbabwe’s depreciating currency, known as bondnotes.

 

“We will not accept the money that they are refusing. We want the money that buys,” Zimbabwe Hospital Doctors Association Vice President Marambire Sinaravo Jongwe said this to his members. “We are very understanding people, we are very lenient to our government. They are just trying to ignore us, they are very insincere to doctors. But yet we are saving the public, the general of Zimbabwe. For our patients we care, the government does not care.”

 

The doctors also say they do not want to prescribe drugs that are not in stock, a practice that forces patients to seek out black market drugs.

The Medicines Control Authority of Zimbabwe has warned about such drugs being fake, expired and unsafe to use.

 

The government, meanwhile, said last week it is not in a position to pay doctors or any civil servants in U.S. dollars.

Officials say they have imported medicines and are now stocking hospitals. But with doctors still on strike, that news might not be enough to help patients like Kasirina Zibveka.
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U.S. Commerce Secretary Wilbur Ross said there is “a very good chance” that the United States and China will reach a trade agreement. 

Ross told CNBC he is hopeful such a deal would address “all the key issues.”

Working-level trade talks between the United States and China began Monday in Beijing with negotiators for the world’s two biggest economies trying to resolve tariff disputes that have roiled world markets in recent weeks.

In a sign the meeting was off to a good start, China’s economic czar, Vice Premier Liu He, dropped by the talks on Monday to encourage the negotiators.

While Chinese officials expressed optimism at the start of the two-day talks, Beijing at the same time complained about the sighting of the U.S.S. McCampbell, a warship, in what it said were Chinese waters near disputed islands in the South China Sea.

Chinese Foreign Ministry spokesman Lu Kang said China had made “stern complaints” with the United States about the sighting of the destroyer, but the trade talks went ahead as scheduled.

There was no immediate U.S. response to the Chinese complaint.

Few details have emerged from the trade talks, which are scheduled to run through Tuesday.

​The trade talks are the result of an agreement last month between U.S. President Donald Trump and Chinese President Xi Jinping to stop the tit-for-tat tariff conflict between the two countries for 90 days starting on New Year’s Day. 

Trump said last week, “I think we’ll have a deal with China.” 

Lu said the two countries have agreed to hold “positive and constructive” discussions.

“From the beginning we have believed that China U.S. trade friction is not a positive situation for either country or the world economy,” Lu said. “China has the good faith, on the basis of mutual respect and equality, to resolve the bilateral trade frictions.”

​The talks are occurring as Chinese growth — 6.5 percent in the July-to-September period — fell to its lowest point in a decade. There are concerns that U.S. growth, 3.4 percent in the third quarter, is also slowing even as the country’s unemployment rate remains nearly at a five-decade low.

Even so, Lu said, “China’s development has ample tenacity and huge potential. We have firm confidence in the strong long-term fundamentals of the Chinese economy.”

The United States has long complained about access to the vast Chinese market and Beijing’s demands U.S. companies reveal their technology advances.
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Mexican President Andres Manuel Lopez Obrador said on Monday that his crackdown against fuel theft was yielding positive results, even as the intervention sparked severe fuel shortages in parts of the country and long lines of angry motorists.

In a bid to eliminate years of mounting theft, state oil firm Pemex has changed its distribution, triggering shortfalls in at least six states, including Guanajuato, a major car-making hub in central Mexico.

Guanajuato’s state government said that less than one third of the state’s gas stations were open on Monday.

Lopez Obrador told a news conference the government had not established a date for when operations would return to normal, but stressed that supply was not in danger.

“We are changing the whole distribution system, that’s the reason for the shortage. We have enough gasoline,” he said.

Mexican television showed long lines of drivers waiting to fill up in central states as well as Jalisco in the west and Tamaulipas in the north.

Years of fuel theft by criminal groups and others by tapping pipelines and stealing tanker trucks has led to losses totaling billions of dollars for public coffers.

Lopez Obrador’s government has ordered the armed forces to intervene in Pemex’s facilities, including one refinery.

“The supply will normalize, and at the same time we are going to guarantee that fuel is not stolen,” said Lopez Obrador, who took office in December. “We have seen a reduction in theft like never before … but we still have work to do.”

Guanajuato’s governor Diego Sinhue told local radio that of the state’s 415 gas stations, only 115 were open. In Leon, Guanajuato’s biggest city with a population of more than 1.5 million, only 7 of 196 stations were open on Sunday, he said.

“Fuel is becoming a serious problem,” said Sinhue, a member of the opposition center-right National Action Party (PAN). “People are really angry about this shortage.”

Sinhue said the army had informed him it had taken control of the state’s Salamanca refinery on Monday morning. There, members of the armed forces were monitoring tankers going in and out of the facility, as well as the pressure of pipelines.

Energy Minister Rocio Nahle offered an apology on Mexican radio for the shortages. Asked when the problem would be fixed, she said it was in the process of being “normalized.”
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Amazon has eclipsed Microsoft as the most valuable publicly traded company in the U.S. as a see-sawing stock market continues to reshuffle corporate America’s pecking order.

The shift occurred Monday after Amazon’s shares rose 3 percent to close at $1,629.51 and lifted the e-commerce leader’s market value to $797 billion. Meanwhile, Microsoft’s stock edged up by less than 1 percent to finish at $102.06, leaving the computer software maker’s value at $784 billion.

It marks the first time Amazon has held the top spot and ends Microsoft’s brief return to the pinnacle after it surpassed Apple in late November.

The repositioning has been triggered by mounting concerns that the Trump administration’s trade war with China and rising interest rates will bog down the worldwide economy. If that were to happen, it’s likely to slow the growth of companies in technology and other industries that generate a substantial chunk of their revenue outside the U.S.

That’s one reason most technology stocks are well off their peaks. Amazon, for instance, remains 21 percent below its high reached in September when the company’s stock value stood above $1 trillion. Apple was worth even more back then, but its stock has plunged by 37 percent since early October to erase about $400 billion of its market value.

Apple confirmed some of investors’ worst fears last week when it warned that disappointing demand for iPhones, especially in China, caused its revenue for its most recent quarter to fall well below the projections of its management and industry analysts.
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India’s cabinet on Monday backed proposals to reserve 10 percent of government jobs for Indians outside the higher income brackets, a plan the main opposition party suggested was an attempt by the government to lure back voters as an election nears.

The initiative is expected to mainly benefit the upper echelons of India’s centuries-old Hindu caste system, which has traditionally been a core voter base for Prime Minister Narendra Modi’s Hindu nationalist Bharatiya Janata Party.

Modi must call a national election by May and was dealt a setback in December when the BJP lost power to the opposition Congress party in three states, its biggest defeat since he took office in 2014.

Two BJP sources said the quota plan would benefit people from other religions not covered by existing affirmative action — the reason why lower caste Hindus and India’s indigenous tribes were excluded from it.

According to the government bill, the recipients must also be classed as “economically weak,” which the sources said was defined as anyone with annual income below 800,000 rupees ($11,500) and owning fewer than five acres of land.

In 2017, the average income in India was $1,939.60, according to the World Bank.

The states the BJP lost included Rajasthan, one of four — the others being Maharashtra, Gujarat and Haryana — in which upper caste land-owning farming communities have held large protests in recent years demanding quotas for government jobs.

More broadly, Modi has been criticized for failing to deliver jobs for young people and better conditions for farmers.

“The … Modi government has suddenly woken up to the woes of [the] economically poor, facing imminent defeat in the 2019 elections,” Congress spokesman Randeep Singh Surjewala said of the quota plan.

“Creating reservations in jobs may just prove to be one more ‘Jumla’ [gimmick] for the purpose of election promises.”

Ashwini Kumar Choubey, junior health minister and a BJP member, welcomed the proposal, calling it “historic.”

Caste system

Hindus, who account for about four-fifths of India’s 1.3 billion people, were traditionally grouped into thousands of castes, whose membership is determined by birth.

The lower castes have faced various forms of discrimination including segregation and social boycotts.

There have been attempts to reduce caste-related inequality, and the country has had many lower caste leaders, including current president Ram Nath Kovind.

But introducing quotas for lower castes has always been a contentious issue and has led to violent protests, though India’s income levels and expenditure patterns remain largely linked to caste.

The government is expected to submit the quota bill to the lower house of parliament on Tuesday. Modi’s BJP has a majority there, but not in the upper house.
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Tesla broke ground Monday on a new factory for its electric cars in China, the first of its factories to be located outside the United States.

Chief Executive Elon Musk appeared at a ceremony alongside local officials on the outskirts of Shanghai to mark the start of the project. He said the goal is to finish initial construction by summer and start production by the end of the year.

Tesla will build its Model 3 vehicles at the site and says it hopes to eventually have a production capacity of 500,000 vehicles per year. The factory is wholly owned by Tesla, a departure from usual Chinese policy for foreign businesses.

The new factory comes as the United States and China negotiate trade issues that have led each side to impose higher tariffs on the other’s goods, including the automotive sector.

By having a factory in China, Tesla will not have to worry about consumers there facing higher prices on cars imported from the United States.
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Tesla broke ground Monday on a new factory for its electric cars in China, the first of its factories to be located outside the United States.

Chief Executive Elon Musk appeared at a ceremony alongside local officials on the outskirts of Shanghai to mark the start of the project. He said the goal is to finish initial construction by summer and start production by the end of the year.

Tesla will build its Model 3 vehicles at the site and says it hopes to eventually have a production capacity of 500,000 vehicles per year. The factory is wholly owned by Tesla, a departure from usual Chinese policy for foreign businesses.

The new factory comes as the United States and China negotiate trade issues that have led each side to impose higher tariffs on the other’s goods, including the automotive sector.

By having a factory in China, Tesla will not have to worry about consumers there facing higher prices on cars imported from the United States.
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A U.S. trade delegation has arrived in Beijing.

The group is in China to hold two days of talks, beginning Monday, focusing on how best to carry out an agreement reached by U.S. President Donald Trump and Chinese President Xi Jinping to postpone new tariff hikes.

On December 1, the two leaders agreed to complete talks about technology, intellectual property and cyber theft issues within 90 days, and hold off on new tariffs in the meantime.

U.S. officials have said that if the talks fail to produce a satisfactory agreement Washington will increase tariffs on $200 billion of Chinese goods from 10 percent to 25 percent.

 

 

 
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China has sounded a positive note ahead of trade talks this week with Washington, but the two sides face potentially lengthy wrangling over technology and the future of their economic relationship.

Both sides have expressed an interest in settling their tariff fight over Beijing’s technology ambitions. Yet neither has indicated its stance has changed since a Dec. 1 agreement by Presidents Donald Trump and Xi Jinping to postpone further increases.

Envoys will have “positive and constructive discussions” during meetings Monday and Tuesday, said Chinese Foreign Ministry spokesman Lu Kang.

The American side is led by a deputy U.S. trade representative, Jeffrey D. Gerrish, according to the U.S. government. Neither side gave details of their agenda but Gerrish’s delegation includes agriculture, energy, commerce, treasury and State Department officials.

The Chinese government gave no details of who would represent Beijing.

The talks are going ahead despite tensions over the arrest of a Chinese tech executive in Canada on U.S. charges related to possible violations of trade sanctions against Iran.

Trump imposed tariff increases of up to 25 percent on $250 billion of Chinese imports over complaints Beijing steals or pressures companies to hand over technology. Beijing responded by imposing penalties on $110 billion of American goods, slowing customs clearance for U.S. companies and suspending issuing licenses in finance and other businesses.

Washington, Europe and other trading partners complain Beijing’s tactics violate its market-opening obligations.

The clash reflects American anxiety about China’s rise as a potential competitor in telecommunications and other technology. Trump wants Beijing to roll back initiatives like “Made in China 2025,” which calls for the state-led creation of global competitors in such fields as robotics and artificial intelligence. American officials worry those might erode U.S. industrial leadership.

The ruling Communist Party is reluctant to give up initiatives it sees as a path to prosperity and global influence.

China’s leaders have tried to defuse complaints by emphasizing the country’s potential as an export market. They have announced a series of regulatory changes over the past year to increase foreign access to their auto, finance and other industries.

Some Chinese officials suggest the technology initiatives might be opened to foreign companies. But they have given no details, leaving it unclear whether that will satisfy Washington.

Trump and Xi agreed to a 90-day postponement of additional tariff increases to take effect Jan. 1. But economists say that is too little time to settle all the disputes that bedevil U.S.-Chinese relations. They say Beijing’s goal probably is to show enough progress to persuade Trump to extend his deadline.

During that 90-day period, agreements “may not be reached until the last day,” said Tu Xinquan, director of the China Institute for World Trade Organization Studies at the University of International Business and Economics in Beijing.

This week’s talks will focus on technical details before higher-level leaders “make hard political decisions,” Tu said.

In the longer term, the final tariffs might “remain for several years,” Tu said. “I don’t think it will proceed that fast. It must take time.”

Cooling economic growth in both countries is turning up the pressure to reach a settlement.

Chinese growth fell to a post-global crisis low of 6.5 percent in the quarter ending in September. Auto sales tumbled 16 percent in November over a year earlier. Weak real estate sales are forcing developers to cut prices.

The U.S. economy grew at an annual rate of 3.4 percent in the third quarter, and unemployment is at a five-decade low. But surveys show consumer confidence is weakening because of concern that growth will slow this year.

Beijing has tried in vain to recruit France, Germany, South Korea and other governments as allies against Trump. They criticize his tactics but echo U.S. complaints about Chinese industrial policy and market barriers.

The European Union filed its own challenge in the World Trade Organization in June against Chinese rules that the 28-nation trade bloc said hamper the ability of foreign companies to protect and profit from their own technology.

For their part, Chinese officials are unhappy with U.S. curbs on exports of “dual use” technology with possible military applications. They complain China’s companies are treated unfairly in national security reviews of proposed corporate acquisitions, though almost all deals are approved unchanged.

Some manufacturers that serve the United States have shifted production to other countries to avoid Trump’s tariffs.

UBS said Friday that 37 percent of 200 manufacturers surveyed by the bank have shifted out of China over the past 12 months. The threat of U.S. tariff hikes was the “dominating factor” for nearly half, while others moved because of higher costs or tighter environmental regulation.

“Most firms expect the trade war to escalate,” the bank said.

 

 
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your ads here!

China has sounded a positive note ahead of trade talks this week with Washington, but the two sides face potentially lengthy wrangling over technology and the future of their economic relationship.

Both sides have expressed an interest in settling their tariff fight over Beijing’s technology ambitions. Yet neither has indicated its stance has changed since a Dec. 1 agreement by Presidents Donald Trump and Xi Jinping to postpone further increases.

Envoys will have “positive and constructive discussions” during meetings Monday and Tuesday, said Chinese Foreign Ministry spokesman Lu Kang.

The American side is led by a deputy U.S. trade representative, Jeffrey D. Gerrish, according to the U.S. government. Neither side gave details of their agenda but Gerrish’s delegation includes agriculture, energy, commerce, treasury and State Department officials.

The Chinese government gave no details of who would represent Beijing.

The talks are going ahead despite tensions over the arrest of a Chinese tech executive in Canada on U.S. charges related to possible violations of trade sanctions against Iran.

Trump imposed tariff increases of up to 25 percent on $250 billion of Chinese imports over complaints Beijing steals or pressures companies to hand over technology. Beijing responded by imposing penalties on $110 billion of American goods, slowing customs clearance for U.S. companies and suspending issuing licenses in finance and other businesses.

Washington, Europe and other trading partners complain Beijing’s tactics violate its market-opening obligations.

The clash reflects American anxiety about China’s rise as a potential competitor in telecommunications and other technology. Trump wants Beijing to roll back initiatives like “Made in China 2025,” which calls for the state-led creation of global competitors in such fields as robotics and artificial intelligence. American officials worry those might erode U.S. industrial leadership.

The ruling Communist Party is reluctant to give up initiatives it sees as a path to prosperity and global influence.

China’s leaders have tried to defuse complaints by emphasizing the country’s potential as an export market. They have announced a series of regulatory changes over the past year to increase foreign access to their auto, finance and other industries.

Some Chinese officials suggest the technology initiatives might be opened to foreign companies. But they have given no details, leaving it unclear whether that will satisfy Washington.

Trump and Xi agreed to a 90-day postponement of additional tariff increases to take effect Jan. 1. But economists say that is too little time to settle all the disputes that bedevil U.S.-Chinese relations. They say Beijing’s goal probably is to show enough progress to persuade Trump to extend his deadline.

During that 90-day period, agreements “may not be reached until the last day,” said Tu Xinquan, director of the China Institute for World Trade Organization Studies at the University of International Business and Economics in Beijing.

This week’s talks will focus on technical details before higher-level leaders “make hard political decisions,” Tu said.

In the longer term, the final tariffs might “remain for several years,” Tu said. “I don’t think it will proceed that fast. It must take time.”

Cooling economic growth in both countries is turning up the pressure to reach a settlement.

Chinese growth fell to a post-global crisis low of 6.5 percent in the quarter ending in September. Auto sales tumbled 16 percent in November over a year earlier. Weak real estate sales are forcing developers to cut prices.

The U.S. economy grew at an annual rate of 3.4 percent in the third quarter, and unemployment is at a five-decade low. But surveys show consumer confidence is weakening because of concern that growth will slow this year.

Beijing has tried in vain to recruit France, Germany, South Korea and other governments as allies against Trump. They criticize his tactics but echo U.S. complaints about Chinese industrial policy and market barriers.

The European Union filed its own challenge in the World Trade Organization in June against Chinese rules that the 28-nation trade bloc said hamper the ability of foreign companies to protect and profit from their own technology.

For their part, Chinese officials are unhappy with U.S. curbs on exports of “dual use” technology with possible military applications. They complain China’s companies are treated unfairly in national security reviews of proposed corporate acquisitions, though almost all deals are approved unchanged.

Some manufacturers that serve the United States have shifted production to other countries to avoid Trump’s tariffs.

UBS said Friday that 37 percent of 200 manufacturers surveyed by the bank have shifted out of China over the past 12 months. The threat of U.S. tariff hikes was the “dominating factor” for nearly half, while others moved because of higher costs or tighter environmental regulation.

“Most firms expect the trade war to escalate,” the bank said.

 

 
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A surge in U.S. job creation and some reassuring words from the head of the U.S. central bank sent U.S. stocks soaring Friday.  

The Labor Department reported a net gain of 312,000 jobs in December, far more than economists predicted. The unemployment rate, however, rose slightly, to 3.9 percent.

Many analysts said the rising unemployment rate was probably good news because rising wages prompted many jobless people to start looking for work.

People are not counted as officially unemployed unless they have searched for work in the past four weeks. In December, the labor force expanded by a healthy 419,000 people as wages rose 3.2 percent over the past year.

PNC Bank Chief Economist Gus Faucher said the data meant worries about a possible recession were probably “overblown.” Worried investors have sent stocks mostly downward in recent months in a series of drastic gains and losses driven in part by concern that the U.S. central bank might raise interest rates too quickly and choke off growth.

Federal Reserve Chair Jerome Powell said Friday that Fed officials were “listening carefully” to markets that were weighing the impact of “concerns on global growth and trade negotiations.”

Dec Mullarkey of Sun Life Investment Management wrote that “markets were reassured” because the Fed made it clear it was not on course to automatically raise rates and would “dynamically adjust as new data and trends emerge.”

By the close of trading, the Dow advanced more than 700 points, as the major U.S. indexes rose more than three percent.  
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your ads here!

A surge in U.S. job creation and some reassuring words from the head of the U.S. central bank sent U.S. stocks soaring Friday.  

The Labor Department reported a net gain of 312,000 jobs in December, far more than economists predicted. The unemployment rate, however, rose slightly, to 3.9 percent.

Many analysts said the rising unemployment rate was probably good news because rising wages prompted many jobless people to start looking for work.

People are not counted as officially unemployed unless they have searched for work in the past four weeks. In December, the labor force expanded by a healthy 419,000 people as wages rose 3.2 percent over the past year.

PNC Bank Chief Economist Gus Faucher said the data meant worries about a possible recession were probably “overblown.” Worried investors have sent stocks mostly downward in recent months in a series of drastic gains and losses driven in part by concern that the U.S. central bank might raise interest rates too quickly and choke off growth.

Federal Reserve Chair Jerome Powell said Friday that Fed officials were “listening carefully” to markets that were weighing the impact of “concerns on global growth and trade negotiations.”

Dec Mullarkey of Sun Life Investment Management wrote that “markets were reassured” because the Fed made it clear it was not on course to automatically raise rates and would “dynamically adjust as new data and trends emerge.”

By the close of trading, the Dow advanced more than 700 points, as the major U.S. indexes rose more than three percent.  
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