A Chinese company that manufactured Ivanka Trump shoes and has been accused of serious labor abuses is being celebrated in a blockbuster propaganda film for extending China’s influence around the globe.

 

The state-backed documentary “Amazing China” portrays the Huajian Group as a beneficent force spreading prosperity — in this case, by hiring thousands of Ethiopians at wages a fraction of what they’d have to pay in China. But in Ethiopia, Huajian workers told The Associated Press they work without safety equipment for pay so low they can barely make ends meet.

 

“I’m left with nothing at the end of the month,” said Ayelech Geletu, 21, who told the AP she earns a base monthly salary of 1,400 Birr ($51) at Huajian’s factory in Lebu, outside Addis Ababa. “Plus, their treatment is bad. They shout at us whenever they want.”

With epic cinematography, “Amazing China” — produced by China Central Television and the state-owned China Film Group Co. Ltd. — articulates a message of how China would like to be seen as it pursues President Xi Jinping’s vision of a globally resurgent nation, against a reality that doesn’t always measure up.

China’s ruling Communist Party recently announced it would take direct control of major broadcasters and assume regulatory power over everything from film and TV to books and news.

 

As the party deepens its ability to cultivate “unity of thought” among citizens, “Amazing China” demonstrates the scope of China’s propaganda machine, which not only crafted a stirring documentary about China’s renaissance under Xi but also helped manufacture an adoring audience for it.

 

The movie, which weaves together extraordinary feats of engineering and military, environmental and cultural achievements, hit theaters three days before China’s rubber-stamp legislature convened to amend the constitution and allow Xi to potentially rule China for life.

 

The star — duly noted by IMDb.com — is Xi himself, who appears more than 30 times in the 90-minute film.

 

“Amazing China” presents Huajian as an inspiring example of China exporting the success of its own economic miracle by creating transformative jobs for thousands of poor Ethiopians and sharing China’s knowledge, language and can-do discipline to build a new industrial foundation for Ethiopia’s economy.

The company is celebrated as a model of the inclusiveness at the heart of a much larger project: Xi’s signature One Belt One Road initiative, a plan to spread Chinese infrastructure and influence across dozens of countries so ambitious in scope that it’s been compared to the U.S.-led Marshall Plan after World War II.

 

“In opening to the outside world, China’s pursuit is not to only make our lives better, but to make the lives of others better,” the narrator says.

 

In the film, Huajian chairman Zhang Huarong stands before neat rows of Ethiopian workers singing a song about unity, describing himself as a father to his employees, who “like me very much.”

 

But four current and former Huajian employees told the AP their wages were so low that they struggled to pay their bills. They said they had no protective gear, were forced to work 12 hours a day and participate in military-style physical drills, were not permitted to form a union and were regularly yelled at by their Chinese managers.

 

All that made it hard for them to relate to the inspirational video about Huajian circulated by mobile phone with its sweeping shots of a gleaming factory and a soundtrack that repeats in operatic Mandarin: “Huajian has come, Huajian has come … holding the torch of hope.”

 

“If someone complains, he will be accused of disturbing the workplace and will be fired right away,” said Ebissa Gari, a 22-year-old who estimated he earns 960 Birr ($35) a month. “That’s why we keep quiet and work no matter how much we are subdued.”

Getahun Alemu, a 20-year-old who quit Huajian last year to continue his studies, complained of inadequate safety gear.

 

“There are chemicals that hurt our eyes and nose, and machines that cut our hands,” he said. “They have no idea about hand gloves! If you refuse to work without that protective gear, then you will be told to leave the company.”

 

Huajian declined the AP’s requests for comment. Ivanka Trump’s brand said it no longer does business with Huajian and “has always and continues to take supply chain integrity very seriously.”

 

Huajian’s investment in Ethiopia was part of a government-led industrialization drive. In the last few years, Ethiopia’s leaders and business allies came under intense criticism, with more than 300 businesses attacked by protesters who saw them as bolstering a repressive regime.

 

These days, armed soldiers stand guard at the entrance to the Eastern Industrial Zone in Ethiopia’s Oromia region, where Huajian opened its first factory.

 

Six years after the company’s arrival, the dream of turning Ethiopia into a shoe-manufacturing hub remains unrealized, and few harbor illusions about the main incentive for Huajian’s investment in a country where there is no legal minimum wage.

 

“These companies are moving out of Asia and coming to Africa to save labor costs,” said Fitsum Arega, who recently stepped down as head of the Ethiopian Investment Commission to become an adviser to the new prime minister. He praised Huajian for employing more than 5,000 Ethiopians, but said the company “could have done better.”

 

“I’m not saying all employees are happy and there are no abuses here and there,” Arega said, adding that the government pushes companies to protect workers. “There’s a labor law which actually the companies say favors the employees.”

 

The Chinese-owned Eastern Industrial Zone effectively took fertile land from Ethiopian farmers and handed it over to foreign investors — a strategy the Ethiopian government is rethinking, according to Nemera Mamo, a teaching fellow in economics at the University of London.

 

“You can clearly see that these industrial zones are absolutely favorable to the Chinese investors, but not to the local communities or the local private investors,” he said. Huajian workers told the AP they made 960 Birr ($35) to 1,700 Birr ($62) a month. A basic living wage in Ethiopia is about 3,000 Birr ($109) a month, according to Ayele Gelan, a research economist at the Kuwait Institute for Scientific Research.

 

In a post promoting “Amazing China” on its official WeChat account, Huajian claimed to be Ethiopia’s largest exporter — an exaggeration also promulgated by China’s official Xinhua News Agency.

Huajian is Ethiopia’s largest shoe exporter, shipping out $19.3 million worth of goods last fiscal year, according to Ethiopia’s Leather Industry Development Institute. But coffee producer Mullege PLC said it exported $42 million worth of coffee during the same period and that other companies export even more.

 

Huajian’s record within China also has been troubled. In at least five cases since 2015, Huajian sued workers in Chinese court rather than pay compensation mandated by a government arbitration panel. Huajian lost every case, court records show, and the court had to freeze Huajian’s assets to get one worker the 44,174 yuan ($7,000) he was owed.

 

Last year, Huajian found itself entangled in labor and human rights controversies that made global headlines but attracted little attention in China’s official media. Three men working with the New York-based non-profit group China Labor Watch were arrested after their investigation of Ivanka Trump’s suppliers zeroed in on Huajian. The men are out on bail, but remain under police surveillance.

 

China Labor Watch founder Li Qiang said Huajian’s factory in Ganzhou, in southeastern Jiangxi province, had some of the worst conditions he has ever encountered, including excessive overtime, low pay, and verbal and physical abuse.

 

Huajian has called those allegations “completely not true to the facts, taken out of context, exaggerated” and accused the investigators of conducting industrial espionage — a charge that was parroted in China’s party-controlled media.

Wei Tie, the director of “Amazing China,” said he wasn’t aware of the controversy surrounding Huajian until the AP informed him. That’s not too surprising given the years of positive coverage of Huajian in party-controlled media and the fact that many foreign news sites, especially Chinese-language ones, are blocked inside China.

 

Wei said he included the company in the film because it is “introducing China’s experience of prosperity to Africa.”

 

He said he prefers to focus on the good. “What I did was absorb the essence and discard the dross,” he said, citing a longstanding aphorism of Chinese political thought.

 

At first glance, Wei’s selective approach appears to have resonated with Chinese audiences. “Amazing China” smashed box-office records for documentary films, raking in 456 million yuan ($72 million) in its first five weeks, according to ticketing website Maoyan.com. It even thumped “Star Wars: The Last Jedi.”

 

Wei attributed this success to the “spontaneous feeling” of citizens inspired by the arc of tremendous progress they’ve witnessed, a national rejuvenation forged with sweat and skill that he compared to Europe’s Renaissance and the pioneering days of the American republic.

In Shanghai, midday screenings during the week sold out immediately, suggesting either unquenchable public appetite or organized bulk ticket sales.

 

None of the viewers surveyed by AP had purchased their own tickets. Instead, they said they got them from state-run companies, neighborhood committees or government departments that handed them out as part of their “party building work.”

 

Douban, a popular film review website, blocked users from rating and commenting on the movie. The only entries came from official media, which gave it an 8.5 out of 10 ranking. On IMDb.com, a subsidiary of Amazon, “Amazing China” earned only one star.

 

But for some, “Amazing China” is balm for old feelings of inferiority and a welcome reaffirmation that China is ready to resume its rightful place in the community of great nations.

 

“I did not know how good our country is until I watched this movie,” said Zuo Qianyi, a 68-year-old retiree. “I have been to many countries, Britain, Spain, and they are not as good as China, at least not as Shanghai. I am very happy, and I will love my country more.”
…

U.S. Commerce Secretary Wilbur Ross said on Tuesday that the Trump administration was prepared to levy tariffs on China if an American delegation heading to Beijing did not reach a negotiated settlement to reduce trade imbalances.

Ross, speaking to CNBC television before traveling to China for talks on Thursday and Friday with top Chinese officials, said he had “some hope” agreements could be reached to resolve the trade tensions between the world’s two largest economies.

But he added that U.S. President Donald Trump, who has made reducing the U.S. trade deficit with China a key part of his administration’s trade policy, would have to first approve any deals.

Top economic officials

The U.S. delegation to Beijing also includes Trump’s top economic officials, including Treasury Secretary Steven Mnuchin, U.S. Trade Representative Robert Lighthizer, White House trade and manufacturing adviser Peter Navarro, and top White House economic adviser Larry Kudlow.

Ross said Trump was ready to impose tariffs on Chinese steel and aluminum imports and to further punish Beijing over its intellectual property practices under so-called Section 232 and Section 301 trade investigations.

“If we don’t make a negotiated settlement, we will pursue the 232s and impose them, we will pursue the 301 and impose them. So, one way or another, we are going to deal with this recurring problem of trade with China,” Ross told CNBC.

No details

Ross did not provide details on the Trump administration’s specific demands on China but said, “We have a pretty good idea of what we need to come out with.”

Trump administration officials have called for a $100 billion reduction in the United States’ $375 billion trade deficit with China, a reduction in China’s car tariffs, and more U.S. access to the Asian nation’s vast markets.

“If they gave in on most of the things that we wanted, for sure there are some things that perhaps are not totally satisfactory, so this is going to come back to the president,” Ross said. “This won’t be, suddenly in Beijing, a breathtaking release (that) everything is solved.”
…

Workers and protesters throughout the world observed May Day Tuesday with rallies and strikes demanding their governments address better working conditions and other labor issues.

In addition to being an international day honoring workers or a traditional spring time festival, Tuesday is also International Worker’s Day in many countries.

Russia

In Moscow, about 120,000 people marched from Red Square to the main streets in a traditional May Day parade.

In St. Petersburg, Russia, several hundred citizens upset over the Kremlin’s efforts to restrict internet freedom, joined the official May Day celebration. They protested the ban of the messaging application Telegram, a move that triggered a rally in Moscow that was attended by 10,000 people.

Spain

Marches calling for gender equality, higher salaries and better pensions were held in more than 70 cities in Spain. Thousands of people turned out for the largest rally in Madrid, displaying a show of unity behind the slogan “Time to Win.”

General Union Workers’ Union of Spain leader Pepe Alvarez said meeting the demands of feminists, youths and workers are necessary to “redistribute wealth.”

Spain’s economy has been among the fastest growing in Europe in recent years.

United States

May Day Demonstrations for immigrant and labor rights were planned in California, New York, Florida and other U.S. cities.

“The Trump administration has made very clear that they’ve declared war on the immigrant community on all levels,” said Javier Valdez of the advocacy group Make the Road New York.

Immigration rights organizations have participated in May Day activities for over a decade to resist anti-immigration legislation. Now the advocates are focusing on voter turnout in the November mid-term elections.

South Korea

In downtown Seoul, South Korea, about 10,000 labor union members took to the streets to call for a higher minimum wage and to make other demands.

The rally, organized by the Korean Federation of Trade Unions, urged the government to approve a $9.34 minimum wage and convert non-regular workers to regular employees with equal pay.

Turkey

Dozens of demonstrators were detained during May Day events in Istanbul, most of whom tried to march toward the city’s main square in defiance of a government ban.

Citing security concerns, the Turkish government declared Taksim Square off-limits. Nevertheless, small groups of people chanting “Taskim cannot be off limits on May 1” tried to push their way into the square, resulting in scuffles and the detention of 45 demonstrators.

Taksim Square is symbolically significant to Turkey’s labor movement. Thirty-four people were killed there during a May Day event in 1977 when shots were fired into the crowd from a nearby building.

Indonesia

Some 10,000 workers rallied near the presidential palace in Jakarta, Indonesia, urging the government to raise wages and to refrain from outsourcing. They also called for a ban on foreign laborers in Indonesia, saying their presence reduces job opportunities for local workers.

Greece

Thousands of Greeks marched through central Athens in several May Day demonstrations.

Museums were closed and public transportation operated on a reduced schedule.

Police said at least 7,000 people attended one rally in Athens that was planned by the communist party-led union. They marched past parliament toward the United States Embassy.

Cambodia

Prime Minister Hun Sun observed May Day in Cambodia with about 5,000 garment workers just outside the capital of Phnom Penh.

About 2,000 other garment workers gathered at a park in Phnom Penh for a rally. They wanted to march to the National Assembly to convince lawmakers to assist them with labor issues, but the group was stopped by riot police.

Philippines

Some 5,000 people demonstrated near the presidential palace in Manila to protest Philippine President Rodrigo Duterte’s failure to fulfill a campaign promise to halt the practice of short-term employment.

They also demanded that the government provide higher wages and address joblessness and trade union repression.  

South Africa

Separate May Day marches organized by rival trade unions were held in the coastal South African city of Durban and in other parts of the country.

Riot police were deployed as members of the Congress of South African Trade Unions and the South African Federation of Trade Unions marched through routes that were designed to put distance between the two unions.

On Monday, COSATU President S’dumo Diamini said at a news conference, “We call upon all workers to work together. Their enemy is one: Monopoly capital.”
…

Pakistan has formally reopened a major trade route with landlocked Afghanistan after nearly four years.

Authorities had closed the remote Ghulam Khan border crossing in North Waziristan in 2014 after launching a major army-led counter-militancy offensive in the tribal district, once condemned as the “epicenter” of international terrorism.

Military officials say the Waziristan region has since been almost completely secured and rehabilitation as well as reconstruction activities are currently under way there.

Pakistani Prime Minister Shahid Khaqan Abbasi traveled to the tribal region on Monday and inaugurated a newly constructed terminal to formally resume cross-border trading activities.

Ghulam Khan is the third-largest official crossing point on the nearly 2,600-kilometer, largely porous frontier between Pakistan and Afghanistan.

Torkham and Chaman are the other two crossings that Afghans use for bilateral trade and transit through Pakistani land and sea routes. Additionally, the two installations are used by visitors traveling in either direction.

The United States and NATO also rely heavily on Pakistan’s ground and air lines of communications for ferrying supplies and non-lethal military equipment to thousands of international troops stationed in Afghanistan.

Pakistan’s relations with Afghanistan have deteriorated in recent years over mutual allegations of supporting militant attacks against each other.

Political tensions often have prompted Pakistani authorities to abruptly close the Torkham and Chaman border crossings, reducing bilateral trade to just over $1 billion from $2.6 billion about two years ago.

Officials and traders on both sides have welcomed resumption of trade through Ghulam Khan, hoping the move will help ease political tensions and increase bilateral trade.

Afghan and Pakistani traders have long urged their respective governments to “segregate” business and trade ties from political and security tensions for promoting mutual trust.

Lately, troubled relations have prompted Afghans to look for alternate routes and they have turned their attention to the India-funded Iranian port of Chabahar for transit trade, bypassing Pakistan.

The Pakistani port of Karachi, however, is still the most economical route for Afghan transit trade, say business leaders in both countries.
…

The third and fourth biggest U.S. wireless carriers, T-Mobile and Sprint, said Sunday they plan to merge, the third attempt they’ve made to join forces against the country’s two biggest mobile device firms, Verizon and AT&T.

The deal, if it happens this time, calls for T-Mobile to buy Sprint for $26 billion in an all-stock deal.

The combined carrier would have 126 million customers, still third in the pecking order of U.S. wireless carriers, but closer to the top two. Verizon has more than 150 million customers, and AT&T more than 142 million.

The latest agreement caps four years of on-and-off talks between T-Mobile and Sprint. Sprint dropped its bid for T-Mobile more than three years ago after U.S. regulators objected and another proposed merger fell through last November.

The new deal could help the combined companies slash costs to make the new business more competitive with industry leaders. But customers could also pay more for wireless coverage because the combined company may not have to offer as many deals to attract new customers.

U.S. regulators at the Federal Communications Commission are expected to take a close look at the merger’s effects on customers and whether the deal violates antitrust laws.
…

From T-shirts, socks and toys to knives and lanterns, a store in upstate New York takes pride in only selling goods that are made in America. Olga Loginova from VOA’s Russian service talked to the store owner about his business, which emerged after the 2008 financial crisis.
…

The U.S. economy likely slowed in the first quarter as growth in consumer spending braked sharply, but the setback is expected to be temporary against the backdrop of a tightening labor market and large fiscal stimulus.

Gross domestic product probably increased at a 2.0 percent annual rate, according to a Reuters survey of economists, also held back by a moderation in business spending on equipment as well as a widening of the trade deficit and decline in investment in homebuilding.

Those factors likely offset an increase in inventories. The economy grew at a 2.9 percent pace in the fourth quarter. The government will publish its snapshot of first-quarter GDP Friday at 8:30 a.m. 

Don’t lose sleep

The anticipated tepid first-quarter growth will, however, probably not be a true reflection of the economy, despite the expected weakness in consumer spending. First-quarter GDP tends to be soft because of a seasonal quirk. The labor market is near full employment and both business and consumer confidence are strong.

“I would not lose sleep over first-quarter GDP, there is the residual seasonality issue,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania. “Overall the economy is doing very well and will continue to do well this year and into 2019.”

Economists expect growth will accelerate in the second quarter as households start to feel the impact of the Trump administration’s $1.5 trillion income tax package on their paychecks. Lower corporate and individual tax rates as well as increased government spending will likely lift annual economic growth to the administration’s 3 percent target, despite the weak start to the year.

Federal Reserve officials are likely to shrug off weak first-quarter growth. The U.S. central bank raised interest rates last month in a nod to the strong labor market and economy, and forecast at least two rate hikes this year.

Minutes of the March 20-21 meeting published earlier this month showed policymakers “expected that the first-quarter softness would be transitory,” citing “residual seasonality in the data, and more generally to strong economic fundamentals.”

Consumer spending lackluster

Economists estimate that growth in consumer spending, which accounts for more than two-thirds of U.S. economic activity, braked to below a 1.5 percent rate in the first quarter. That would be the slowest pace in nearly five years and follows the fourth quarter’s robust 4.0 percent growth rate.

Consumer spending in the last quarter was likely held back by delayed tax refunds and impact of tax cuts. Rebuilding and clean-up efforts following hurricanes late last year probably pulled forward spending into the fourth quarter.

“Our new consumer survey found that 37 percent of consumers thought they didn’t get any extra income from the tax cut or did not know what to do with it,” said Michelle Meyer, head of U.S. economics at Bank of America Merrill Lynch in New York. “It is possible this means that there is a lag in the consumer response to tax cuts.”

Business spending

Business spending on equipment is forecast to have slowed after double-digit growth in the second half of 2017. The expected cooling in equipment investment partly reflects a fading boost from a recovery in commodity prices. Economists expect a marginal impact on business spending on equipment from rising interest rates and more expensive raw materials.

“While we do not expect rising rates to crush equipment spending, a slowdown nevertheless appears in store,” said Sarah House, a senior economist at Wells Fargo Securities in Charlotte, North Carolina. “Higher interest rates will hurt at the margin.”

Investment in homebuilding is forecast to have declined in the first quarter after rebounding in the October-December period. Government spending probably contracted after two straight quarterly increases. Spending is, however, expected to rebound in the second quarter after the U.S. Congress recently approved more government spending.

Trade was likely a drag on GDP growth for a second straight quarter after royalties and broadcast license fees related to the Winter Olympics boosted imports.

With consumer spending slowing, inventories probably accumulated in the first quarter. Inventory investment is expected to have contributed to GDP growth after subtracting 0.53 percentage point in the fourth quarter.
…

Amazon.com Inc. more than doubled its profit Thursday and predicted strong spring results as the world’s biggest online retailer raised the price for U.S. Prime subscribers, added U.S. football games and touted its cloud services for business.

The results showed the broad strength of the company, which has been expanding far beyond shipping packages, the business that has drawn the ire of U.S. President Donald Trump.

The forecast beat expectations on Wall Street, sending shares up 7 percent to a new record in afterhours trade and adding $8 billion to the net worth of Jeff Bezos, Amazon’s chief executive and largest shareholder.

Seattle-based Amazon is winning business from older, big box rivals by delivering virtually any product to customers at a low cost, and at times faster than it takes to buy goods from a physical store. It is expanding across industries, too, striking a $130 million deal to stream Thursday night games for the U.S. National Football League online and working to ship groceries to doorsteps from Whole Foods stores nationwide.

Sales jumped 43 percent to $51.0 billion in the quarter, topping estimates of $49.8 billion, according to Thomson Reuters.

Prime now $119

Prime, Amazon’s loyalty club that includes fast shipping, video streaming and other benefits, has been key to Amazon’s strategy. Its more than 100 million members globally spend above average on Amazon.

The company announced Thursday it will increase the yearly price of Prime to $119 from $99 for U.S. members this spring.

The fee hike is expected to add a windfall to Amazon’s subscription revenue, already up 60 percent in the first quarter at $3.1 billion.

“We do feel it’s still the best deal in retail,” Brian Olsavsky, Amazon’s chief financial officer, said on a call with analysts. He said the number of items Prime members can get within two days had grown fivefold since the last price increase four years ago.

Advertising and the cloud

Despite the surge in shopping, Olsavsky gave credit for Amazon’s $1.6 billion profit last quarter to two younger businesses: advertising and Amazon Web Services.

Revenue from third-party sellers paying to promote their products on Amazon.com was an unusually large bright spot during the quarter, with sales in the category, which includes some other items, growing 139 percent to $2.03 billion. This included $560 million from an accounting change.

Amazon Web Services (AWS), which handles data and computing for large enterprises in the cloud, won new business and saw its profit margin expand. It posted a 49 percent rise in sales from a year earlier to $5.44 billion, beating estimates.

Amazon remains the biggest in the space by revenue, and its stock trades at a significant premium to cloud-computing rival Microsoft Corp.

Amazon’s shares have also outperformed the S&P 500, rising 30 percent this year as of Thursday’s market close, compared with the S&P’s less than 1 percent decline.

More workers, spending

Notorious for running on a low profit margin, Amazon has still reaped rewards for shareholders as it has bet on new services like voice-controlled computing and has expanded across continents and industries.

Global headcount was up 60 percent from a year earlier at 563,100 full-time and part-time employees, thanks to a hiring spree and an influx of workers from Whole Foods Market.

The company plans to increase its video content spending this year, Amazon’s Olsavsky said, with a prequel to “The Lord of the Rings” in the works. The third quarter will also see extra spending to prepare for the busy holiday season.

Amazon is working with JPMorgan Chase & Co and Berkshire Hathaway Inc to determine how to cut health costs for hundreds of thousands of their employees.

And it is expanding its retail footprint outside the United States, particularly in India. Amazon’s international operating loss grew 29 percent to $622 million in the first quarter.
…

Much remains to be done before a new North American Free Trade Agreement is reached, Mexican Economy Minister Ildefonso Guajardo said Thursday, tempering hopes for a quick deal as ministers met in Washington for a third successive day.

Negotiators from the United States, Mexico and Canada have been working constantly for weeks to clinch a deal, but major differences remain on contentious topics such as autos content.

Complicating matters, the Trump administration has threatened to impose sanctions on Canadian and Mexican steel and aluminum on May 1 if not enough progress has been made on NAFTA.

President Donald Trump, who came into office in January 2017 decrying NAFTA and other international trade deals as unfair to the United States, has repeatedly threatened to walk away from the agreement with Canada and Mexico, which took effect in 1994.

“It is going, it’s going, but not easy — too many things, too many issues to tackle,” Guajardo told reporters after a meeting with U.S. Trade Representative Robert Lighthizer.

Now under way for eight months, the talks to revamp the accord underpinning $1.2 trillion in trade entered a more intensive phase after the last formal round of negotiations ended in March with ministers vowing to push for a deal.

Lighthizer is due to visit China next week, and when asked if a deal was possible before the USTR left, Guajardo said: “It will depend on our abilities and creativity. We are trying to do our best, but there are still a lot of things pending.”

Although Washington is keen for an agreement soon to avoid clashing with a July 1 Mexican presidential election, the three NAFTA members remain locked in talks to agree on new rules governing minimum content requirements for the auto industry.

Still, Canadian Foreign Minister Chrystia Freeland rejected the notion that discussion of the so-called rules of origin for the automotive sector was holding up the process.

“I would very much disagree with the characterization of the autos conversation as being log-jammed,” she said as she entered the USTR offices. “This is a week when very good, significant progress is being made on rules of origin for the car sector.”

Freeland said she would skip a planned visit to a NATO summit in Brussels on Friday, and vowed to stay in Washington for “as long as it takes.” Guajardo, too, said he was ready to remain in Washington this week for more talks.

Disagreements

The three sides are also trying to settle disagreements over U.S. demands to change how trade disputes are handled, to restrict access to agricultural markets and to include a clause that would allow a country to quit NAFTA after five years.

Bosco de la Vega, head of Mexico’s National Agricultural Council, the main farm lobby, said he believed the three would be able to reach an agreement on agricultural access.

But the auto sector rules were still contentious, he added.

“It’s the most important issue there,” he said, adding that he had earmarked May 10 as the deadline for a quick deal.

Separately, Canada on Thursday unveiled details of how it plans to prevent the smuggling of cheap steel and aluminum into the North American market in a bid to avoid the U.S. tariffs.

Prime Minister Justin Trudeau, who announced the plan last month, said Ottawa would hire 40 new trade officers to probe complaints, including those related to steel and aluminum.
…

Kenya’s economy is expected to rebound to 5.8 percent growth in 2018 after electoral uncertainty and drought cut last year’s expansion to the lowest level in more than five years, Finance Minister Henry Rotich said Wednesday.

The economy will benefit from increased investment in key areas like manufacturing, farming, housing and health care, he said.

President Uhuru Kenyatta won re-election in November in a second vote after the first in August was annulled by the Supreme Court citing irregularities. Around 100 people, mainly opposition supporters, were killed mainly by police during the prolonged election season.

“Despite the slowdown in 2017 our outlook is bright,” Rotich said at the launch of the annual economic survey. “We expect growth to recover to 5.8 percent in 2018, and over the medium term the growth is projected to increase by more than 7 percent.”

Growth slowed to 4.9 percent last year from a revised 5.9 percent in 2016, the statistics office said.

Kenya’s diversified economy is better able to withstand shocks like the commodity price drop that started in 2014 and hit oil-producing African countries such as Nigeria and Angola.

But its economy was hobbled by a severe drought in the first quarter of last year that was followed by poor rainfall.

The services sector including tourism grew strongly last year and that helped to offset the slowdown in farming and manufacturing, said Zachary Mwangi, director general of the Kenya National Bureau of Statistics.

Tourism is vital for hard currency and jobs and grew 14.7 percent while earnings surged 20 percent, he said.

In contrast, growth in the agriculture sector, which accounts for close to a third of overall output, slid to 1.6 percent in 2017 from 5.1 percent the year before.

The government says manufacturing is a priority due to its potential to create jobs, and it grew at 0.2 percent last year from 2.7 percent the year before.

Production of cement, sugar and processed milk slid as firms reeled from the impact of the election and high costs.

Rotich said the projected economic rebound is supported by favorable economic fundamentals including inflation, which has dropped to about 4 percent this year.

“The ongoing investments in infrastructure, improved business and factory confidence, and strong private consumption are expected to support growth,” he said.
…

The humble pecan is being rebranded as more than just pie.

 

Pecan growers and suppliers are hoping to sell U.S. consumers on the virtues of North America’s only native nut as a hedge against a potential trade war with China, the pecan’s largest export market.

 

The pecan industry is also trying to crack the fast-growing snack-food industry.

 

The retail value for packaged nuts, seeds and trail mix in the U.S. alone was $5.7 billion in 2012, and is forecast to rise to $7.5 billion by 2022, according to market researcher Euromonitor.

 

The Fort Worth, Texas-based American Pecan Council, formed in the wake of a new federal marketing order that allows the industry to band together and assess fees for research and promotion, is a half-century in the making, said Jim Anthony, 80, the owner of a 14,000-acre pecan farm near Granbury, Texas.

 

Anthony said that regional rivalries and turf wars across the 15-state pecan belt — stretching from the Carolinas to California — made such a union impossible until recently, when demand for pecans exploded in Asian markets.

Until 2007, most U.S. pecans were consumed domestically, according to Daniel Zedan, president of Nature’s Finest Foods, a marketing group. By 2009, China was buying about a third of the U.S. crop.

 

The pecan is the only tree nut indigenous to North America, growers say. Sixteenth-century Spanish explore Cabeza de Vaca wrote about tasting the nut during his encounters with Native American tribes in South Texas. The name is French explorers’ phonetic spelling of the native word “pakan,” meaning hard-shelled nut.

 

Facing growing competition from pecan producers in South Africa, Mexico and Australia, U.S. producers are also riding the wave of the Trump administration’s policies to promote American-made goods.

 

Most American kids grow up with peanut butter but peanuts probably originated in South America. Almonds are native to Asia and pistachios to the Middle East. The pecan council is funding academic research to show that their nuts are just as nutritious.

 

The council on Wednesday will debut a new logo: “American Pecans: The Original Supernut.”

Rodney Myers, who manages operations at Anthony’s pecan farm, credits the pecan’s growing cachet in China and elsewhere in Asia with its association to rustic Americana — “the oilfield, cowboys, the Wild West — they associate all these things with the North American nut,” he said.

 

China earlier this month released a list of American products that could face tariffs in retaliation for proposed U.S. tariffs on $50 billion worth of Chinese goods. Fresh and dried nuts — including the pecan — could be slapped with a 15-percent tariff, according to the list. To counter that risk, the pecan council is using some of the $8 million in production-based assessments it’s collected since the marketing order was passed to promote the versatility of the tree nut beyond pecan pie at Thanksgiving.

 

While Chinese demand pushed up prices it also drove away American consumers. By January 2013, prices had dropped 50 percent from their peak in 2011, according to Zedan.

U.S. growers and processers were finally able in 2016 to pass a marketing order to better control pecan production and prices.

 

Authorized by the Agricultural Marketing Agreement Act of 1937, federal marketing orders help producers and handlers standardize packaging, impose quality control and fund research, according to the U.S. Department of Agriculture, which oversees 28 other fruit, vegetable and specialty marketing orders, in addition to the pecan order.

 

Critics charge that the orders interfere with the price signals of a free, unfettered private market.

 

“What you’ve created instead is a government-sanctioned cartel,” said Daren Bakst, an agricultural policy researcher at the conservative Heritage Foundation.

 

Before the almond industry passed its own federal marketing order in 1950, fewer almonds than pecans were sold, according to pecan council chair Mike Adams, who cultivates 600 acres of pecan trees near Caldwell, Texas. Now, while almonds appear in everything from cereal to milk substitutes, Adams calls the pecan “the forgotten nut.”

 

“We’re so excited to have an identity, to break out of the pie shell,” said Molly Willis, a member of the council who owns an 80-acre pecan farm in Albany, Georgia, a supplement to her husband’s family’s peanut-processing business.
…

President Donald Trump’s trade fight with China moved inside the white marble walls of the U.S. Supreme Court on Tuesday, where lawyers for both countries faced off over whether Chinese companies can be held liable for violating U.S. antitrust laws.

The nine justices heard arguments in an appeal by two American companies of a lower court ruling that threw out claims of price fixing against two Chinese vitamin C manufacturers based on submissions by China’s government explaining that nation’s regulations.

The arguments provided both countries an opportunity to air their differences over an aspect of their trade relationship.

The Supreme Court took the unusual step on April 13 of granting China the ability to present arguments even though it is not an official party in the case. Typically, only the U.S. government is reserved that privilege.

The world’s two economic superpowers are engaged in an escalating trade fight. The United States, accusing China of unfair trade practices and theft of intellectual property, has threatened to impose tariffs on up to $150 billion of Chinese industrial and other imports. China has threatened comparable retaliation against U.S. exports if Washington pushes ahead with the tariffs.

None of the heated rhetoric over tariffs trickled into Tuesday’s arguments, which remained respectful. The lawyer representing China, Carter Phillips, urged the justices to defer to China’s explanation about Chinese regulations. A U.S. Justice Department lawyer said that such deference comes with limits.
…

Rice farmers in Kafr Ziada village in the Nile River Delta have ignored planting restrictions aimed at conserving water for years, continuing to grow a medium-grain variety of the crop that is prized around the Arab world.

A decision thousands of kilometers to the south is about to change that, however, in another example of how concern about water, one of the world’s most valuable commodities, is forcing change in farming, laws and even international diplomacy.

Far upstream, close to one of the sources of the Nile, Ethiopia is preparing to fill the reservoir behind its new $4 billion Grand Renaissance Dam, possibly as soon as this year.

How fast it does so could have devastating consequences for farmers who have depended on the Nile for millennia to irrigate strategic crops for Egypt’s 96 million people, expected to grow to 128 million by 2030.

Safeguarding Egypt’s share of the Nile, on which the country relies for industry and drinking water as well as farming, is now at the top of President Abdel Fattah el-Sissi’s agenda as he begins a second term.

At the same time, authorities are finally tackling widespread illegal growing of the water-intensive rice crop, showing a sense of urgency that even climate change and rapid population growth has failed to foster.

The crackdown means Egypt will likely be a rice importer in 2019 after decades of being a major exporter, rice traders say.

Cairo has decreed that 724,000 feddans (750,000 acres) of rice can be planted this year, which grain traders estimate is less than half of the 1.8 million feddans actually cultivated in 2017 — far in excess of the officially allotted 1.1 million feddans.

Police have started raiding farmers’ homes and jailing them until they pay outstanding fines from years back.

“The police came to my house at three in the morning and took me to the station to pay the fine,” said Mohamed Abdelkhaleq, head of the farming association in Kafr Ziada, some 125 km (80 miles) north of Cairo in Beheira governorate.

“Even if the fine is 1 Egyptian pound (5 U.S. cents), they’ll come to your house.”

Three other farmers reported similar experiences and said this year they would not plant rice.

Reda Abdelaziz, 50, said some people have become afraid to leave the village.

“If you’re traveling and they take your ID card and see you have a fine on you, they’ll put you in jail,” he said.

Abdelkhaleq took to the local mosque’s loudspeaker last month to say the government was doubling the fine for unauthorized rice cultivation to 7,600 pounds per feddan.

Mostafa al-Naggari, who heads the rice committee of Egypt’s agricultural export council, says if the government sticks to the new approach Egypt will likely have to import as much as 1 million tons of rice next year.

“The dam has opened the door for there to be more of an awareness of water scarcity issues, but Egypt has for a long time needed to review its water allocation policy,” he said.

No Agreement

Egypt has long considered the Nile its own, even though the river and its tributaries flow through 10 countries. Egyptian President Anwar Sadat famously said in 1979 that he was prepared to go to war over the Nile if its flow was ever threatened.

But any threat from Ethiopia in the past was empty — until now. The new dam, cutting through the Blue Nile tributary just before its descent into southeastern Sudan, will offer Addis Ababa immense political leverage over its downstream neighbors.

Sudan and Egypt are the biggest users of the river for irrigation and dams. Egypt wants to be assured that the dam will not affect the river’s flow, estimated at about 84 billion cubic meters on average per year.

Ethiopia aims to use the dam to become Africa’s biggest power generator and exporter, linking tens of millions to electricity for the first time.

The two countries have not been able to agree on a comprehensive water-sharing arrangement despite years of negotiations.

Ethiopia was not party to and does not recognize a 1959 agreement between Egypt and Sudan that gave Cairo the rights to the lion’s share of the river. For its part, Egypt refuses to sign on to a 2010 regional water-sharing initiative that takes away its power to veto projects that would alter allocations.

Ethiopia says that its dam won’t affect the Nile’s flow once its 79-billion-cubic-meter reservoir is filled. The issue is over how fast that happens. Ethiopia wants to do it in as little as three years; Egypt is aiming for seven to 10, sources close to the matter said.

There’s no doubt the flow of the Nile will be affected during those years. What’s not known is how dramatically, and there is little data available to answer that question.

Sources at Egypt’s irrigation ministry have estimated the loss of 1 billion cubic meters of water would affect 1 million people and lead to the loss of 200,000 acres of farmland.

On that basis, “if (the dam is) filled in 3 years it might destroy 51 percent of Egypt’s farmland, if in 6 years it will destroy 17 percent,” said Ashraf el Attal, CEO of Dubai-based commodities trader Fortuna and an expert on Egypt’s grain trade.

Be Ready to Adapt

The U.N.’s Food and Agriculture Organization has said Egypt requires an “urgent and massive” response to maintain food security in coming years for a number of reasons, including water scarcity, urbanization and the effects of climate change.

Talks among Egypt, Sudan and Ethiopia on the dam in early April stalled over what Sudan’s foreign minister called “technical issues”. No date has been set for the next round.

“The filling of the GERD is just the most critical issue for the three countries to decide upon, and now, ahead of the first filling,” said Ana Cascão, an independent researcher on Nile hydropolitics.

“A fair and equitable filling strategy must take into account different scenarios on climate and rainfall variability — if it will be one of drought, then the three countries are ready to agree on a slower filling,” said Cascão.

Rice farmers, who typically begin planting at the end of April, said they may now leave their lands fallow given the difficulty of quickly switching to other summer crops like cotton and corn that require different machinery and techniques.

Irrigation Minister Mohamed Abdel Aty told Reuters the situation posed a big threat to crops, livelihoods and even political stability if efforts to coordinate fail.

“Imagine to what extent these people will become vulnerable,” he said.

($1 = 17.6400 Egyptian pounds)
…

Amazon Chief Executive Jeff Bezos said Tuesday that it was right that big companies are scrutinized and that his firm would respond to any new regulations by finding new ways to please its customers.

Bezos was speaking in Berlin, where he received an award from German media company Axel Springer, and was responding to a question about how seriously he took recent criticism of Amazon by U.S. President Donald Trump.

“All large institutions should be scrutinized or examined,” Bezos said. “It is not personal.”

“We have a duty on behalf of society to help educate any regulators without cynicism or skepticism,” he added. “We will work with any set of regulations that we are given. … We will follow those rules and find a new way to delight customers.”

Trump has said he would take a serious look at policies to address what he says are the unfair business advantages of Amazon, accusing the firm of not operating on a level playing field and not paying enough sales tax.

“We humans, especially in the Western world, especially inside democracies, are wired to be mindful of big institutions. … It doesn’t mean you don’t trust them or they are evil or bad,” Bezos said.

Amazon has also come in for criticism elsewhere over its tax policies and treatment of warehouse staff, with hundreds of European workers protesting on Tuesday outside the building where Bezos was speaking over pay and conditions.

“I’m very proud of our working conditions and I’m very proud of the wages we pay,” Bezos said. “We don’t believe we need a union to be an intermediary between ourselves and our workers.”

Post ownership

Bezos also defended his ownership of The Washington Post, which Trump has called the “chief lobbyist” for Amazon. The Post is privately owned by Bezos, not Amazon.

Bezos said the need to scrutinize large organizations was one of the reasons that the Post’s work was so important, adding he had no problem with the newspaper pursuing critical reporting about Amazon and said he would never meddle in the newsroom.

“I would be humiliated to interfere,” he said. “I would turn bright red. I don’t want to. It would feel icky, it would feel gross.

“Why would I? I want that paper to be independent.”

Bezos, the world’s richest person with a fortune of more than $100 billion, added that he was not interested in buying other newspapers, despite receiving monthly requests to bail out other struggling media organizations.

He said he would keep liquidating about $1 billion of Amazon stock a year to fund his Blue Origin rocket company, saying he hoped to test a tourism vehicle with humans at the end of this year or the beginning of next year.

Asked about the scandal over the alleged misuse of the data of nearly 100 million Facebook users, Bezos said Amazon had worked hard on security: “If you mistreat your data, they will know, they will work it out. Customers are very smart.”
…

A cup of coffee is a good way for many to start the day. But it can also do far greater good. Manyang Kher, a former Sudanese child refugee – one of the so-called Lost Boys and now a US citizen – is passionate about helping refugees build a brighter future. And he does it with coffee. VOA’s June Soh talked with the founder of a social enterprise, 734 coffee. VOA’s Carol Pearson narrates her report.
…

Manyang Kher was three years old when he arrived at a refugee camp in Ethiopia’s Gambella region. During the 13 years, the South Sudanese native lived there, he observed lots of other children die. From hunger. From cholera. From attempting to flee the camp.

“You fear every day because you may die, too,” Kher says.

Kher is one of the so-called Lost Boys of Sudan, some 20,000 Sudanese children who escaped when their villages were attacked during the 1980’s civil war and made the 1600 kilometer-walk to Ethiopia.

Deeply affected by the camp, he has named his coffee company, 734 Coffee, after the geographical coordinates of the Gambella region: 7˚N 34˚E. Part of his larger humanitarian non profit project, Humanity Helping Sudan, 734 helps the 200,000 South Sudanese refugees still in the region.

“I know these people,” Kher says. “I speak the language; I know the struggles those refugees face every day.”

Kher is dedicating 80% of his coffee proceeds to helping them. “A cup of 734 coffee can buy; this cup can buy, one fishing net.” A fishing net is a dollar. It is also a tool that can help a refugee achieve self-sufficiency.

Kher’s aim is to help refugees help themselves. He wants them to be aid-free. 

“That’s why we give fishing nets because they can go to the river and fish for themselves. If you build more community gardens they can grow their own food. If you also build water wells, now you create a community because they can get the water there they can grow their own food there. They can also open their own market there. 200,000 refugees is a market.”

Delicious coffee

At age 16, Kher came to the U.S. as an unaccompanied minor refugee. While he was in college in Richmond, Virginia studying international law, he started Humanity Helping Sudan to raise awareness of the refugees. Now, the group has programs, including 734 Coffee, to help empower the displaced to become self-sufficient.

Kher operates 734 Coffee out of two warehouses in Virginia, but the coffee comes from a co-op of African owned and operated farms in the Gambella region. It is roasted by local, independent coffee roasters in the U.S.

He launched the company last year, selling coffee online, at events and to coffee shops. 

Megan Murphy who owns a bakery outside of Washington, serves 734 to her customers at Capital City Confectionery.

“The customers love it,” she says. “Whenever they find out about the project, about the mission, they connect right with it. The coffee tastes delicious, so it’s a win-win on both sides. You get to enjoy coffee (and) at the same time be part of the bigger project.”

Following the sun

When Kher’s South Sudanese village was attacked and burned in the early 1980’s, he was separated from his parents, who he never saw again. He and other orphaned children followed the sun. 

“Most people in my village believe that where the sun rises up, there is peace…The children go there and they just keep going.”

Kher and the others chased the sun to the refugee camp, a horrific journey. 

“Thousands of boys lost their lives to hunger, dehydration, and exhaustion. Some were attacked and killed by wild animals; others drowned crossing rivers and many were caught in the crossfire of fighting forces,” the International Rescue Committee says on its website.

“Too many children died along the way,” Kher summarizes.

But as he looks around his coffee warehouse, he seems to make some sense of it. “I never imagined I would be in a position to help anyone,” he says.
…

Former New York City Mayor Michael Bloomberg announced Sunday he is giving $4.5 million to the United Nations Climate Change Secretariat to cover a U.S. government funding gap for the international Paris climate accord.

Bloomberg’s charitable foundation said the money will support work developing countries are doing to achieve their targets under the agreement as well as “promoting climate action” among cities and businesses.

The 2015 treaty signed by more than 200 nations and entities vowed to curb carbon dioxide and other greenhouse gas emissions in order to try to limit global temperature rise.

Former President Barack Obama’s administration was among the signatories, but President Donald Trump said he would pull out of the agreement. Trump campaigned as a booster of fossil fuels and a skeptic of climate change science, and said the Paris accord would cause U.S. businesses to lose millions of jobs.

“This agreement is less about the climate and more about other countries gaining a financial advantage over the United States,” Trump said last year.

Bloomberg made a similar payment last year and pledged to continue the contributions. He told CBS News in an interview broadcast Sunday that Trump is capable of changing his position.

“But he should change his mind and say, look, there really is a problem here, America is part of the problem, America is a big part of the solution, and we should go in and help the world stop a potential disaster,” Bloomberg said.

The United States is among the world’s top emitters of carbon dioxide.

But in late March, U.N. Secretary-General Antonio Guterres said that because of the actions of businesses and local authorities, the U.S. “might be able to meet the commitments made in Paris as a country.” 

Guterres appointed Bloomberg as his special envoy for climate action in March. Guterres tweeted Sunday thanking Bloomberg “for his generous support to the United Nations but also for his global leadership on climate action.”

Last year was the third warmest year on record. Scientists increasingly see evidence of climate change in heat waves, storms and other extreme weather.
…

The World Bank’s shareholders on Saturday endorsed a $13 billion paid-in capital increase that will boost China’s shareholding but bring lending reforms that will raise borrowing costs for higher-middle-income countries, including China.

The multilateral lender said the plan would allow it to lift the group’s overall lending to nearly $80 billion in fiscal 2019 from about $59 billion last year and to an average of about $100 billion annually through 2030.

“We have more than doubled the capacity of the World Bank Group,” the institution’s president, Jim Yong Kim, told reporters during the International Monetary Fund and World Bank spring meetings in Washington. “It’s a huge vote of confidence, but the expectations are enormous.”

The hard-fought capital hike, initially resisted by the Trump administration, will add $7.5 billion paid-in capital for the World Bank’s main concessional lending arm, the International Bank for Reconstruction and Development.

Its commercial-terms lender, the International Finance Corp, will get $5.5 billion paid-in capital, and IBRD also will get a $52.6 billion increase in callable capital.

Lending rules

The bank agreed to change IBRD’s lending rules to charge higher rates for developing countries with higher incomes, to discourage them from excessive borrowing.

IBRD previously had charged similar rates for all borrowers, and U.S. Treasury officials had complained that it was lending too much to China and other bigger emerging markets.

U.S. Treasury Secretary Steven Mnuchin said earlier Saturday that he supported the capital hike because of the reforms that it included. The last World Bank capital increase came in 2010.

Cost controls

The current hike comes with cost controls and salary restrictions that will hold World Bank compensation to “a little below average” for the financial sector, Kim said.

He added that there was nothing specific in the agreement that targeted a China lending reduction, but he said lending to China was expected to gradually decline.

In 2015, China founded the Asian Infrastructure Investment Bank, and lends heavily to developing countries through its government export banks.

The agreement will lift China’s shareholding in IBRD to 6.01 percent from 4.68 percent, while the U.S. share would dip slightly to 16.77 percent from 16.89 percent. Washington will still keep its veto power over IBRD and IFC decisions.

Kim said the increase was expected to become fully effective by the time the World Bank’s new fiscal year starts July 1. Countries will have up to eight years to pay for the capital increase.

The U.S. contribution is subject to approval by Congress.
…

The European Union and Mexico reached an agreement Saturday on a new free trade deal, a coup for both parties in the face of increased protectionism from the United States under President Donald Trump.

Since its plans for a trade alliance with the United States were frozen after Trump’s election victory, the EU has focused instead on trying to champion open markets and seal accords with other like-minded countries.

The agreement in principle with Mexico follows a deal struck last year with Japan and comes ahead of talks next week with the Mercosur bloc of Argentina, Brazil, Paraguay and Uruguay.

“With this agreement, Mexico joins Canada, Japan and Singapore in the growing list of partners willing to work with the EU in defending open, fair and rules-based trade,” said European Commission President Jean-Claude Juncker.

For Mexico, a deal with the EU is part of a strategy to reduce its reliance on the United States, the destination of 80 percent of its exports. That has become more urgent, given Trump’s push to rewrite the North American Free Trade Agreement.

The EU and Mexico wanted to update a trade deal agreed to 21 years ago that largely covers industrial goods. The new deal adds farm products, more services, investment and government procurement, and include provisions on labor and environmental standards and fighting corruption.

The European Commission said that, under the deal struck Saturday, practically all trade in goods with Mexico will be duty-free, including for farm products such as Mexican chicken and asparagus and European dairy produce.

The deal will for example cut Mexican tariffs of up to 20 percent on cheeses such as gorgonzola and increase EU pork exports, the Commission said. 

It will also allow Mexican companies to bid for government contracts in Europe and EU companies for those in Mexico, including at the state level.

Mexican Economy Minister Ildefonso Guajardo said both sides had achieved a major update of their original accord.

“It needed to be more ambitious in the agricultural sector, it needed to be more ambitious in services, it needed to be more ambitious in many of the elements that in the end we managed to agree on after two years of work,” he said.

Guajardo said the deal would grant his country better access for products including orange juice, tuna, asparagus, honey, egg white albumin, as well as “equitable access” for meat products.

It is also set to recognize “geographical indications” for certain food and drink, a key EU demand.

Such indications protect agricultural produce, for example, dictating that the term “champagne” can only be used for sparkling wine from northern France.

It was not clear, however, how the divisive issue of “manchego” cheese had been settled. The EU says the term should only apply to sheep’s milk cheese from central Spain, but Mexico has its own “manchego” made from cow’s milk.

Negotiators from both sides will continue to work on technical details to produce a final text by the end of the year.
…

The International Monetary Fund’s policymaking committee said Saturday that a strong world economy was threatened by increasing tension over trade and countries’ heavy debt burden. Longer-term prospects are clouded, it said, by sluggish growth in productivity and aging populations in wealthy nations.

In a statement at the end of three days of meetings, the lending agency urged countries to take advantage of the broadest-based economic expansion in a decade to cut government debt and to enact reforms that will make their economies more efficient.

The IMF expects the world economy to grow 3.9 percent this year and next, which would be the strongest since 2011. But an intensifying dispute between the U.S. and China over Beijing’s aggressive attempt to challenge U.S. technological dominance has raised the prospect of a trade war that could drag down worldwide growth.

“Trade tensions are not to the benefit of anyone,” said Lesetja Kganyago, who leads the policymaking committee and is governor of the South African Reserve Bank.

The U.S. has resisted pressure to back off President Donald Trump’s protectionist “America First” trade policies.

Treasury Steven Mnuchin urged the IMF to do more to address what the Trump administration says are unfair trade practices and called on the World Bank to steer cheap loans away from China and toward poorer countries.

Unfair trade policies “impede stronger U.S. and global growth, acting as a persistent drag on the global economy,” Mnuchin said.

He appealed for the IMF to go beyond its traditional role as an emergency lender for countries in financial distress and said it should more closely monitor the practices of countries that persistently run large trade surpluses.

“The IMF must step up to the plate on this issue, providing a more robust voice,” Mnuchin said. “We urge the IMF to speak out more forcefully on the issue of external imbalances.”

The World Bank, he said, must not back away from shifting its lending from fast-growing developing countries such as China to poorer nations. In a speech prepared for the bank’s policy committee, Mnuchin urged the bank to aim its resources at “poorer borrowers and away from countries better able to finance their own development objectives.”

Many have used the finance meetings to protest Trump’s protectionist trade policies, which mark a reversal of seven decades of U.S. support for ever-freer global commerce.

“We strongly reject moves toward protectionism and away from the rules-based international trade order,” said Már Guðmundsson, governor of the Central Bank of Iceland. “Unilateral trade restrictions will only inflict harm on the global economy.”

While finance officials struggled to find common ground with Washington on trade, they agreed on the importance of coordinating other policies in an effort to sustain the strongest global economic expansion since the 2008 financial crisis.

“We have to keep this group working together,” said Nicolas Dujovne, Argentina’s treasury minister.

In addition to wrangling over trade, finance officials from the Group of 20 powerful economies focused on geopolitical risks and rising interest rates, two threats to growth. Dujovne, whose country is chairing the G-20 this year, met with reporters Friday to summarize talks held as a prelude to the IMF-World Bank meetings.

The U.S. has rattled financial markets with a series of provocative moves in recent weeks.

Last month, it imposed taxes on imported steel and aluminum, and later proposed tariffs on $50 billion in Chinese products as a punishment for Beijing’s aggressive efforts to obtain U.S. technology. China countered by targeting $50 billion in U.S. exports. Trump then ordered his trade representative to go after up to $100 billion more in Chinese products.

Finance leaders repeatedly sounded warnings about a potential trade war.

“The larger threat is posed by increasing trade tensions and the possibility that we enter a sequence of unilateral, tit-for-tat measures, all of which generate uncertainties for global trade and GDP growth,” Roberto Azevêdo, director-general of the World Trade Organization, told the IMF’s policy committee.

French Finance Minister Bruno Le Maire said the steel and aluminum tariffs could lead to retaliation by other countries and “a significant risk that the situation could escalate.” He said “tensions between the U.S. and China have taken a worrying turn.”
…

U.S. Treasury Secretary Steven Mnuchin said Saturday that he was contemplating a visit to China for discussions on issues that have global leaders concerned about a potentially damaging trade war.

“I am not going to make any comment on timing, nor do I have anything confirmed, but a trip is under consideration,” Mnuchin said at a Washington news conference during the International Monetary Fund and World Bank spring meetings.

Mnuchin said he discussed the possible trip and potential trade opportunities with the new head of China’s central bank.

Tensions have escalated between the U.S. and China over Beijing’s attempts to challenge America’s technological prowess, raising the prospects of a trade war that could hinder global economic growth. 

Mnuchin said he had spoken with a number of his counterparts who have been forced to deal with U.S. President Donald Trump’s “America First” trade policies, including U.S. tariffs on foreign aluminum and steel and on up to $150 billion in Chinese goods. Some of the leaders, he said, were focused on exemptions from the tariffs.

He said he emphasized that the U.S. was not trying to construct protectionist trade barriers with the tariffs. Instead, he said, “we are looking for reciprocal treatment.”

Mnuchin also said he wanted the IMF to do more to address what the Trump administration believes are unfair trade practices. He also called on the World Bank to redirect low-interest loans from China to more impoverished countries. 
…

China has strongly refuted suggestions its multibillion-dollar economic corridor now under construction with Pakistan has “hidden” military designs as well.  

Beijing has pledged to invest about $63 billion in Pakistan by 2030 to develop ports, highways, motorways, railways, airports, power plants and other infrastructure in the neighboring country, traditionally a strong ally.

 

The Chinese have also expanded and operationalized the Pakistani deep water port of Gwadar on the Arabian Sea, which is at the heart of the massive bilateral cooperation, known as the China-Pakistan Economic Corridor, or CPEC. The strategically located port is currently being operated by a Chinese state-run company .

China has positioned CPEC as the flagship project of its $1-trillion global Belt and Road Initiative, or BRI, championed by President Xi Jinping.

“I want to make it very clear, BRI initiative and with CPEC under it, it’s purely a commercial development project. We don’t have any kind of military or strategic design for that,” said Yao Jing, Chinese ambassador to Islamabad. He made the remarks in an exclusive interview with VOA.

Within five years of finalizing and launching CPEC, Jing said that 22 “early harvest” projects out of the 43 total projects under CPEC have been completed or are under construction, with a total investment of around $19 billion, the largest influx of foreign investment in Pakistan’s 70-year-old history. The projects have already brought 60,000 local jobs and effectively addressed the country’s once crippling energy crisis.

 

Power plants built under the joint venture, officials say, will have added more than 10,000 megawatts of electricity to the national grid by June, leading to a surplus of power.

While speaking to VOA, the Chinese diplomat urged the United States and India to “come to the CPEC project” and “witness the progress on the ground” for themselves, saying it will enable them overcome misunderstandings vis-a-vis CPEC.

“There are some kind of doubts that may be there are some things hidden in it. I think that when you have an objective lens to look at this project and to come to the ground to find this progress on the ground then you may have a better understanding of what we are doing here,” said Jing.

The Chinese envoy was responding to concerns expressed in Washington and New Delhi that Beijing could try to turn Gwadar into a military port in the future to try to dominate the Indian Ocean.

Jing explained that a state-to-state defense-related cooperation has for decades existed between the two allied nations and China through “normal channels” is determined to contribute to “military and strategic ability’ of Pakistan.

“We don’t want to make the CPEC as such a kind of platform,” the ambassador emphasized.

However, he added, it is “natural and understandable” that the project’s massive size and design has raised doubts and suspicions” about its aims.   

The skepticism about Chinese intentions stems from, among other things, a massive airport being built in Gwadar, with a landing strip of 12-kilometers. China has given nearly $300 million to Pakistan for the construction of the airport.

“Basically, it is for China and Pakistan to make this project a successful economic project, then we can make it clear our intention here,” Jing said.

India is also opposed to CPEC because a portion of the project is located on territory that is claimed by both New Delhi and Islamabad. But Pakistan and China both dismiss the objections as politically-motivated.

CPEC aims to link the landlocked western Chinese region of Xinjiang to Gwadar, allowing ships carrying China’s oil imports and other goods from the Persian Gulf to use a much shorter and secure route and avoid the existing troubled route through the Strait of Malacca.

There are currently up to 10,000 Chinese nationals working on CPEC-related projects in Pakistan. Ambassador Jing said that 21 new mega-projects, including the establishment of Special Economic Zones across the country, are ready to be launched in the next stage with particular emphasis on encouraging private engagement.

In the next five to seven years, officials estimate, CPEC will have created employment for half-a-million Pakistanis. The country’s troubled economy, lately impacted by insecurity and energy crisis, has grown 5.4 percent in the previous financial year, the fastest rate in a decade, and officials forecast the expected growth in the year ending June 2018 will be six percent.

Pakistan’s deepening cooperation with China comes as the country’s diplomatic relations with the U.S. continue to deteriorate. Washington complains that Islamabad is not doing enough to eliminate terrorist groups using the country’s soil for attacks against neighboring countries, including Afghanistan.

While U.S. economic assistance has significantly reduced in recent years, the Trump administration also suspended military assistance to Pakistan in January and linked its restoration to decisive actions against terrorist groups.

 

Pakistan strongly rejects the allegations and says it is being scapegoated for the U.S.-led coalition’s failures in ending the war in Afghanistan. .

China is also worried about the spread of regional terrorism in the wake of a low-level Muslim separatist insurgency in its troubled Xinjiang border region. But Beijing has steadfastly supported Islamabad’s counterterrorism efforts and dismisses U.S. criticism of them.

China’s arms exports to Pakistan have in recent years exponentially increased while exports of military hardware from the country’s traditionally largest supplier, the U.S., have reportedly declined to just $21-million in 2017 from $1-billion.

“China will never leave Pakistan. I shall say we have confidence in the future of Pakistan,” said Chinese Ambassador Jing, when asked whether terrorism-related concerns might also push Beijing away from Islamabad.

China’s investment under CPEC has also encouraged hundreds of private Chinese companies and thousands of Chinese nationals to arrive in Pakistan to look for business opportunities and buy property. The influx of the foreigners has raised alarms among local businesses and sparked worries that the Chinese labor force will take away local jobs.

Jing stressed that China and Pakistan are working together to promote mutual people-to-people connectivity through enhanced education and cultural linkages to improve mutual understanding.

Ambassador Jing says there are eight Chinese universities working to promote Pakistan’s official Urdu language while 12 Pakistan-study centers are working to promote mutual understanding between the two countries. There are 22,000 Pakistanis seeking education in China.

Pakistani officials say currently, about 25,000 students are learning Chinese language in 19 universities and four Confucius Institutes affiliated with the Chinese Ministry of Education.
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The European Union needs to be exempted from steel and aluminum tariffs announced by the United States in order to work with Washington on trade with China, France’s Finance Minister Bruno Le Maire said Friday.

“We are close allies between the EU and the United States. We cannot live with full confidence with the risk of being hit by those measures and by those new tariffs. We cannot live with a kind of sword of Damocles hanging over our heads,” Le Maire told a press conference during the International Monetary Fund and World Bank spring meetings. 

“If we want to move forward … if we want to address the issue of trade, an issue of the new relationship with China, because we both want to engage China in a new multilateral order, we must first of all get rid of that threat,” he said.

U.S. President Donald Trump announced a 25 percent tariff on steel imports and 10 percent tariff on aluminum imports last month to counter what he has described as unfair international competition.

Le Maire said the EU’s exemption from the tariffs should be “full and permanent.”

The EU is seeking compensation from the United States for the tariffs through the World Trade Organization. Brussels has called for consultations with Washington as soon as possible and is drawing up a list of duties to be slapped on U.S. products.
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The Justice Department has opened an antitrust investigation into whether AT&T, Verizon and a standards-setting group worked together to stop consumers from easily switching wireless carriers.

 

The companies confirmed the inquiry in separate statements late Friday in response to a report in The New York Times. 

 

The U.S. government is looking into whether AT&T, Verizon and telecommunications standards organization GSMA worked together to suppress a technology that lets people remotely switch wireless companies without having to insert a new SIM card into their phones. 

 

The Times, citing six anonymous people familiar with the inquiry, reported that the investigation was opened after at least one device maker and one other wireless company filed complaints.

Verizon, AT&T respond 

Verizon, which is based in New York, derided the accusations on the issue as “much ado about nothing” in its statement. It framed its efforts as part of attempt to “provide a better experience for the consumer.” 

 

Dallas-based AT&T also depicted its activity as part of a push to improve wireless service for consumers and said it had already responded to the government’s request for information. The company said it “will continue to work proactively within GSMA, including with those who might disagree with the proposed standards, to move this issue forward.”

 

GMSA and the Justice Department declined to comment.

Merger trial

 

News of the probe emerge during a trial of the Justice Department’s case seeking to block AT&T’s proposed $85 billion merger with Time Warner over antitrust concerns. That battle centers mostly on the future of cable TV and digital video streaming.

 

Verizon and AT&T are the two leading wireless carriers, with a combined market share of about 70 percent.
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