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Taiwan Steps up Asia Business to Reduce Dependence on China

Taiwan is offering visa waivers and setting up overseas investment offices across a swathe of countries to its south, the latest moves to deepen a rebalancing of economic relations away from political foe China.

Officials in Taipei hope to foster more tourism, trade and higher education links with 18 countries covering most of South and Southeast Asia plus Australia and New Zealand. Stronger ties in theory would reduce the role of China, which is Taiwan’s top trading partner now, as the two sides struggle over political differences.

In the latest phase of Taiwan’s effort, called the New Southbound Policy, Philippine citizens may visit Taiwan visa-free for 14 days during a trial period that starts next month and ends in July. Taiwan offered waivers to citizens of Brunei and Thailand in August 2016. Those efforts complement new investment offices, growth in the number of university students in Taiwan and more Taiwanese development aid.

“The purpose of the New Southbound Policy is for us to hold a more advantageous position in international society,” Taiwan President Tsai Ing-wen said in a National Day speech earlier this month. “I also want to use this opportunity to tell our friends from around the world that faced with a rapidly changing Asia-Pacific region. Taiwan is ready to play a more important role in shaping regional prosperity and stability.”

Shaky relations with China

Tsai announced the New Southbound Policy after taking office in May 2016 to rebalance relations for Taiwan’s $529 billion economy.

Taiwanese business people traditionally choose China for investment because of its relatively low costs, skilled workforce and cultural links. More than 93,000 Taiwanese businesses invested in China between 1988 and 2016, according to the American think tank Council on Foreign Relations.

But China claims sovereignty over Taiwan despite the island’s democratic self-rule, causing enough friction to stop dialogue under Tsai’s presidency.

How the New Southbound Policy works

Taiwan’s economic affairs ministry has established investment offices in Indonesia, Myanmar, Thailand, Vietnam and the Philippines to help investors find projects in those countries based on local needs.

The Taiwan government is offering as well credit guarantees for smaller businesses headed to Southeast Asia, where aid from Taipei will help pay for infrastructure and other major projects in those countries. The visa waivers facilitate travel to Taiwan, another boon to the economy.

Taiwan’s trade with the 18 countries covered by the policy had risen 20 percent this year compared to last, Tsai said in her speech without giving an exact time frame.

Tourist arrivals from New Southbound countries are rising as the headcount from China decreases, official data show. The number of postsecondary students in Taiwan from New Southbound Policy countries went up 10 percent over the six months to March from a year earlier, while the number of non-degree university students from China has eased since mid-2016.

Taiwan’s Investment Commission last year approved 252 applications for projects intended for China last year, down 21.5 percent from 2015.

But China remains Taiwan’s top trading partner thanks to a thriving consumer market and the maturity of its supply chain for the likes of tech and machinery. Imports and exports totaled $117.9 billion in 2016.

Feedback from South and Southeast Asia

Indonesia has been a bright spot for finding new investment projects, especially in agriculture, an economic affairs official in Taipei said earlier in the year. Thailand had already approved 274 Taiwanese investment applications, worth $1.39 billion, from 2010 to 2015.

About 3,500 Taiwanese investors had invested in Vietnam as early as 2011 because costs were rising in China while Vietnam was offering incentives to lure foreign capital.

The restart in May of Taiwanese-owned Formosa Plastics Group’s Vietnam steel plant could draw a “cluster” of related Taiwanese firms, said Liang Kuo-yuan, president of Taipei-based think tank Polaris Research Institute in Taipei. Factory work had stopped over a suspected toxic leak that killed fish.

The Philippines, an investment-thirsty Southeast Asian archipelago, is actively looking for Taiwanese companies, said Jonathan Ravelas, chief market strategist with Banco de Oro UniBank in Metro Manila. Taiwanese electronics firms consider the country an export manufacturing base, he said, while healthcare firms may find partners such as hospitals. The growing consumer base lures others.

“We’re seeing entrepreneurs from Taiwan looking into the Philippines, given that it’s a very big retail market,” Ravelas said.

But one Southeast Asian country, Cambodia, may fear angering China by veering too close to Taiwan. Beijing forbids its allies from establishing formal ties with Taipei. In February Cambodian Prime Minister Hun Sen declared a ban on raising the Taiwan flag. Two years earlier the government forbid Taiwan from establishing an informal trade office.

Still early days

Similar go-south policies fell flat under former Taiwan president Lee Teng-hui in 1993 and his successor, Chen Shui-bian, after 2000. China in those years was cheaper, with less competition from local companies, in turn drawing Taiwanese investors.

Today’s policy will struggle as Taiwan faces competition in the 18 target counties from other foreign investment sources, Liang said. Competitors include China, India, Japan and South Korea. China and India were less competitive before 2000. Taiwan lacks a material advantage, he said.

“The biggest problem is that Southeast Asia is not a blue ocean market,” Liang said. “There are too many competitors, so Taiwan can’t just use its point of view to go compete in that market. Taiwan after all has what strength?”

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Electric Vehicles Poised to Go Mainstream

The bumper sticker on the back of Scott Wilson’s car reads, “This is what the end of gasoline looks like.”

And what does that car look like? A sleek, sci-fi experimental vehicle? A $100,000 Tesla luxury car? 

Nope. It’s just a Kia Soul EV, the battery-powered version of the Korean automaker’s boxy hatchback.

Once the domain of concept cars and hobbyists, electric vehicles are no longer so exotic. And sales are picking up. A record 150,000 of them sold last year in the United States.

“It used to be I knew everyone I saw that was driving an electric car,” said Wilson, the vice president of the Electric Vehicle Association of Greater Washington, D.C. “Now, I don’t.”

There are about to be a lot more strangers in EVs on the roads, many experts say.

Big carmakers, big plans

Volvo says every car it makes in 2019 and beyond will have an electric motor. General Motors says the company “believes in an all-electric future.” Bloomberg New Energy Finance (BNEF) predicts that in just over two decades, EVs will make up more than half of all vehicles sold.

Other analysts have more modest expectations. But even Exxon Mobil sees EVs topping 10 percent of the market by 2040.

Automakers hit a significant milestone in the past year. In December, General Motors launched the Chevrolet Bolt EV, the first car with a price tag under $40,000 and a range of more than 320 kilometers.

Automakers hit a significant milestone in the past year. In December, General Motors launched the Chevrolet Bolt EV, the first car with a price tag under $40,000 and a range of more than 320 kilometers.

That range is “basically double anything else that’s available at a comparable price,” said Chevrolet spokesman Fred Ligouri. Those figures “do wonders for getting beyond” what’s known as range anxiety, potential buyers’ fear of draining the battery before reaching their destination.

One-third of buyers have never owned an electric vehicle before.

“They went from (an) internal combustion engine vehicle right into pure electric,” an encouraging sign, Ligouri said.

The Bolt’s performance has impressed critics as well. Motor Trend magazine named the Bolt the 2017 Car of the Year.

The Bolt beat industry upstart Tesla to the mid-priced market. A modest 15,000 or so have been sold so far. But nearly a half-million people have ordered the Tesla Model 3, the company’s entrant into the mass market, despite long waits and slow production.

“Those are signals that there’s unmet demand for some of these new technologies,” said the World Resources Institute’s Eliot Metzger.

Electrification is cheaper than ever as the price of lithium ion batteries plummets faster than analysts expected. As costs come down, experts are moving up the date when electric vehicles can compete with internal combustion engines on price. BNEF puts that date in the second half of the next decade.

“We’re much further along than most researchers (and) industry insiders would have projected just two or three years ago,” said Nic Lutsey at the International Council on Clean Transportation.

China syndrome

Another reason the industry is moving fast: China.

Officials in the world’s biggest auto market will require carmakers to meet an electric vehicle quota starting in 2019.

Beijing aims to increase EVs’ share of the market from 1 to 2 percent today to around 4 percent in 2020.

“That’s a very large scale up within just several years,” Lutsey noted, but automakers say they can do it.

The push for electric vehicles is part of the government’s plan to clean up the toxic air in China’s major cities. Chinese officials are considering a ban on gas- and diesel-powered cars.

But it’s not just China. Pollution concerns in France, the United Kingdom, and India have officials there considering bans, too.

In the United States, the Trump administration aims to relax vehicle emissions standards, though state policies will likely complicate those efforts.

Without a push from government, experts say electric vehicles will have a hard time making major gains as long as gas prices are relatively low.

But as electric vehicle driver Wilson points out, that can change at any time.

“After the next crisis, when gas is $5 a gallon, then there will be waiting lists for cars like this,” he said.

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Orange Is the New White? Unique Amber Wine Creates Buzz

The sloping vineyards of New York’s Finger Lakes region known for producing golden-hued rieslings and chardonnays also are offering a splash of orange wine.

 

The color comes not from citrus fruit, but by fermenting white wine grapes with their skins on before pressing – a practice that mirrors the way red wines are made. Lighter than reds and earthier than whites, orange wines have created a buzz in trendier quarters. And winemakers reviving the ancient practice like how the “skin-fermented” wines introduce more complex flavors to the bottle.  

 

“Pretty outgoing characteristics. Very spicy, peppery.  A lot of tea flavors, too, come through,” winemaker Vinny Aliperti said, taking a break from harvest duties at Atwater Estate Vineyards on Seneca Lake. “They’re more thoughtful wines. They’re more meditative.”

 

Atwater is among a few wineries encircling these glacier-carved lakes that have added orange to their mix of whites and reds. The practice dates back thousands of years, when winemakers in the Caucasus, a region located at the border of Europe and Asia, would ferment wine in buried clay jars. It has been revitalized in recent decades by vintners in Italy, California and elsewhere looking to connect wine to its roots or to conjure new tastes from the grapes. Or both. Clay jars are optional.

 

Aliperti has been experimenting with skin fermenting for years, first by blending a bit into traditional chardonnays to change up the flavor and more recently with full-on orange wines. This fall, he fermented Vignoles grapes with their skins in a stainless steel vat for a couple of weeks before pressing and then aging them in oak barrels.

Orange wines account for “far less than 1 percent” of what is handled by Southern Glazer’s Wine & Spirits, the nation’s largest distributor with about a quarter of the market, according to Eric Hemer, senior vice president and corporate director of wine education.

 

Hemer expects orange wines to remain a niche variety due to small-scale production, higher retail prices _ up to $200 for a premium bottle – and the nature of the wine.

 

“It’s not a wine that’s going to appeal to the novice consumer or the mainstream wine drinker,” Hemer said. “It really takes a little bit more of, I think, a sophisticated palate.”

 

The wines have caught on in recent years among connoisseurs who like the depth of flavors, sommeliers who can regale customers with tales of ancient techniques and drinkers looking for something different. Christopher Nicolson, managing winemaker at Red Hook Winery in Brooklyn, said the wines hit their “crest of hipness” a couple of years ago, though they remain popular.

 

“I think they’re viewed by these younger drinkers as, ‘Oh, this is something new and fresh. And they’re breaking the rules of these Van Dyke-wearing, monocled … fusty old wine appreciators,’” Nicolson said.

 

It’s not for everyone. The rich flavors can come at the expense of the light, fruity feel that some white wine drinkers crave. And first-time drinkers can be thrown by seeing an orange chardonnay in their glasses.

 

“Actually I wasn’t sure because of the color, but it has a really nice flavor,” said Debbie Morris, of Chandler, Arizona, who tried a sip recently at Atwater’s tasting room. “I’m not a chardonnay person normally, but I would drink this.”

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Trump Urges House Republicans to Move Quickly on Budget, Tax Cuts

President Donald Trump urged House Republicans to move swiftly on passing a budget bill during a conference call Sunday, clearing the way for what he described as an historic push for tax cuts.

 

Trump and Vice President Mike Pence both joined the House GOP call in which Trump called on members to adopt the budget passed by the Senate this week, so that they can move on to passing his tax reform plan.

 

Trump told the members they were on the verge of doing something historic, according to one Republican official on the call, who spoke on condition of anonymity because they were not authorized to discuss publicly what was intended as a private update for members.

 

Another GOP aide familiar with the conversation said that Trump told the members again and again that the party would have a steep price to pay in next year’s midterm elections if they failed to pass his plan, which would slash the corporate tax rate to 20 percent and double the standard deduction used by most average Americans. The president also said multiple times that, beyond the looming elections, his plan was the right thing to do for country, the person said.

 

The Senate last week passed a budget that includes rules that will allow Republicans to get tax legislation through the Senate without Democratic votes and without fear of a Democratic filibuster.

 

Desperate for legislative victory

Republicans are desperate to rack up a legislative win after a series of embarrassing failures that have come despite the fact that the party controls both chambers of Congress and the White House.

 

On the call, House Speaker Paul Ryan told members he hoped to pass a revised Senate budget bill this week to increase the changes that tax reform can be enacted by the end of the year.

Trump will also work to rally support for the plan on the Hill Tuesday at a lunch with Senate Republicans.

 

Congress also continues to wrestle with the health care system.

 

Senate Majority Leader Mitch McConnell said Sunday he’s willing to bring bipartisan health care legislation to the floor – if Trump makes clear he supports it. A proposal by two senators – Republican Lamar Alexander of Tennessee and Democrat Patty Murray of Washington – would extend for two years federal insurance payments that Trump has blocked. But Trump has offered mixed signals, alternately praising and condemning the effort – confusing Democrats and Republicans alike.

 

Asked whether he would bring the bill to the floor, McConnell said on CNN’s “State of the Union” that he was waiting “to hear from President Trump what kind of health care bill he might sign.”

 

“If there’s a need for some kind of interim step here to stabilize the market, we need a bill the president will actually sign.  And I’m not certain yet what the president is looking for here, but I will be happy to bring a bill to the floor if I know President Trump would sign it,” the Republican said. He added of Trump: “I think he hasn’t made a final decision.”

 

Compromise on health care?

The plan unveiled last week likely has 60 votes in the Senate, mostly from Democrats, and Senate Minority Leader Chuck Schumer on Sunday urged McConnell to bring it to the floor “immediately, this week.”

 

“This is a good compromise,” Schumer said on NBC’s “Meet the Press.” He predicted it would pass “by a large number of votes” and that the president would ultimately sign it to avoid the blame for rising insurance premiums.

 

“If Republicans think that if premiums go up they’re going to avoid the blame, if Senator McConnell thinks that, he’s wrong,” Schumer said.

Trump at first suggested he supported the temporary fix as he continues to hold out hope for the passage of legislation that would repeal and replace former president Barack Obama’s Affordable Care Act, which Republicans have repeatedly failed to achieve. But White House officials said later that Trump would only sign an interim bill that also lifts the tax penalties that Obama’s health care law imposes on people who don’t buy coverage and employers who don’t offer plans to employees. The White House also wants provisions making it easier for people to buy low-premium policies with less coverage. Top Senate Democrats reject those demands.

 

White House budget director Mick Mulvaney, who was also spotted at Trump’s Virginia golf course Sunday, said on CBS’ “Face the Nation” that Trump doesn’t want to back a plan “without also getting something for folks who are being hurt.”

 

“And I think the criticisms you’ve heard this week are like, ‘Look, I’m okay with doing a deal.’ This is the president now. ‘But I’m not getting enough for the folks who are getting hurt. So give me more by way of associated health plans. Give me more of the things that we know we can do for folks back home to actually help them,’” Mulvaney said.

 

“I think there’s actually a pretty good chance to get a deal,” he added. “It’s just Murray-Alexander in its current form probably isn’t far enough yet.”

 

McConnell, in his interviews, also but pushed back against former White House chief strategist Steve Bannon’s efforts to recruit candidates to challenge Republican incumbents who support McConnell’s leadership, arguing that what Republicans need is candidates who can win.

 

“Look, this is not about personalities. This is about achievement. And in order to make policy, you have to actually win the election,” he said on Fox News. “And some of these folks that you’ve been quoting, as I said are specialists on nominating people who lose.”

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Debate Sharpens in Washington on Nuclear Pact with Iran

Debate is sharpening in Washington on the merits and potential pitfalls, the risks and possible rewards, of the United States possibly pulling out of the international nuclear accord with Iran. VOA’s Michael Bowman reports, the U.S. Congress has decisions to make now that President Donald Trump has withheld certifying Iran’s compliance with the pact co-negotiated by the Obama administration.

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Key US Senators Call for More Information on Niger Attack

Key U.S. senators called Sunday for the White House to be more forthcoming about the country’s military involvement in Niger after four U.S. soldiers were killed in an ambush there earlier this month.

In separate interviews on NBC’s “Meet the Press” news show, Republican Lindsey Graham and Democratic Senate leader Charles Schumer said they support an effort last week by Republican Senator John McCain to find out the details of the attack as well as the scope of the U.S. campaign against Islamic State in the west African country. Both Graham and Schumer said they had been unaware of the substantial number of the U.S. troops in Niger.

“I didn’t know there was 1,000 troops in Niger,” Graham said. “This is an endless war without boundaries and no limitation on time and geography. You’ve got to tell us more.

“We don’t know exactly where we’re at in the world militarily and what we’re doing,” Graham said. “So John McCain is going to try to create a new system to make sure that we can answer the question, why were we there, we’ll know how many soldiers are there, and if somebody gets killed there, that we won’t find out about it in the paper.

“I can say this to the families,” Graham said. “They were there to defend America. They were there to help allies. They were there to prevent another platform to attack America and our allies.”

Schumer said, “We need to look at this carefully. This is a brave new world. There are no set battle plans.”

He said that he would favor revisiting the current congressional authorization for overseas military action that is 16 years old, an agreement stemming from the 2001 terror attacks on the U.S.

“There is no easy answer but we need to look at it,” he said. “The answer we have now is not adequate.”

Defense Secretary Jim Mattis told Graham and McCain, the chairman of the Senate Armed Services Committee, last week that the military is shifting its counter-terrorism strategy to focus more on Africa. The defense chief said military leaders want to expand their ability to use force against suspected terrorists.

U.S. officials believe the Niger attack was launched by a local Islamic State affiliate, but the Pentagon is still investigating the circumstances of how it occurred.

 

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Trump Defends Frequent Twitter Bickering with US Officials

President Donald Trump is defending his frequent bickering on Twitter with officials across the U.S. political spectrum, saying it sometimes pushes officials “to do what they’re supposed to be doing.”

Trump told Fox News anchor Maria Bartiromo in a wide-ranging interview that aired Sunday, “Sometimes it helps, to be honest with you.”

Republican lawmakers have often suggested Trump end his frequent tweets, but he said, “I doubt I would be here if it were not for social media, to be honest with you.”

He said he views social media as way to present his views unfiltered by the mainstream national media, “because there is a fake media out there. I get treated very unfairly by the media. You have to keep people interested also.

“You know what I find,” he said, “the ones that don’t want me to are the enemies. The people who really don’t like what happened with me and winning the election and of all the things.

“I don’t think I want to take any chances,” Trump said. “And we do get points out there. I mean, we get tremendous points. I can express my views when somebody expresses maybe a false view that they said I gave.

“It works, it just seems to work. I mean, it is a little unconventional,” he said.

On Sunday, Trump continued his attacks against a Florida congresswoman, Democrat Frederica Wilson, who quoted Trump as telling the widow of a U.S. soldier killed in Niger that he “knew what he was getting into” when he joined the military.

In a tweet, Trump said, “Wacky Congresswoman Wilson is the gift that keeps on giving for the Republican Party, a disaster for Dems. You watch her in action & vote” for Republicans.

In the interview, Trump said he wants Congress to move quickly on tax cuts and reforms.

“I will say this,” Trump said, “I want to get it by the end of the year, but I’d be very disappointed if it took that long.”

 

 

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