Peter G. Peterson, a billionaire and business executive who became one of the most prominent voices to argue for entitlement reform and reducing the U.S. national debt, died of natural causes early Tuesday, his family said. He was 91.

Born in the small town of Kearney, Nebraska, to Greek immigrants, Peterson was CEO of two major U.S. companies and co-founded one of the world’s largest private-equity firms.

He was a national figure in business by the early 1960s, serving as chairman and CEO of Bell and Howell, one of the largest manufacturers of movie cameras at the time.

He left Bell and Howell to work for the Nixon administration in the early 1970s, eventually serving as secretary of commerce from 1972 to 1973.

Lehman Brothers 

He took over as chief executive of the investment bank Lehman Brothers in 1973 after leaving the Nixon administration. In 1985, he co-founded the private-equity firm Blackstone Group with Stephen Schwarzman.

“His intelligence, wit and vision made him an inspirational leader who brought people together from the White House to Wall Street,” his family said in a statement.

Blackstone went on to become one of biggest private-equity firms in the world, with $434 billion in assets under management at the end of last year. When the firm went public in 2007, Peterson’s stake in the company made him a billionaire. His wealth was estimated at $2 billion, according to Forbes Magazine.

Fiscal challenges

Peterson dedicated the rest of his life to what he called “key fiscal challenges threatening America’s future,” donating $1 billion to create the Peter G. Peterson Foundation in 2007.

He never publicly endorsed the fiscal ideals of the Tea Party. However, his ideas did give him some common ground with them.

He long argued that the United States’ entitlement programs, principally Medicaid, Medicare and Social Security, had to be restructured or benefits cut back to avoid bankrupting the government. Through his foundation, he disseminated his ideas among the public and politicians.

“The fact he was able to start a serious debate about the future of Social Security and other entitlement programs was a huge accomplishment,” said Fred Bergsten, founder of the Peterson Institute for International Economics, who worked with Peterson in various capacities going back to the 1970s.

Raising taxes

Peterson was not considered ideological when it came to dealing with Social Security and Medicare. A life-long Republican, he still believed that raising taxes should be considered as part of any major restructuring of the U.S. budget, Bergsten said.

The foundation quickly became a major voice on all budget-related matters, repeatedly quoted in national media outlets. In 2008, his organization helped bankroll the documentary “I.O.U.S.A,” with the goal of making the federal government’s ballooning national debt, then around $10 trillion, a central campaign issue.

“What is most significant is most of our challenges are not really being discussed,” Peterson told The Associated Press in 2008 when he created his foundation. “I’ve been a very lucky beneficiary of the American dream as the son of immigrants. And, the more I look at some of these problems, the more persuaded I am they will pose a serious threat to this country.”

Peterson is survived by his wife, Joan Ganz Cooney, who co-founded the Children’s Television Workshop, and children John Peterson, Jim Peterson, David Peterson, Holly Peterson and Michael Peterson, and nine grandchildren.
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The World Bank agreed on a $600 million loan and grant for Ethiopia on Tuesday to pay for roads and other infrastructure in urban areas.

The Washington-based bank said the funds would “help strengthen the capacity and performance of local urban governments, expand sustainable urban infrastructure and services, as well as promote local economic development.”

Ethiopia’s urban population is growing by 3.8 percent annually on average, one of the fastest rates in sub-Saharan Africa, and that is presenting challenges to infrastructure, services and jobs, the bank said.

“To successfully manage urbanization … cities are likely to require fiscal transfers for the foreseeable future. This program will help cities to realize their revenue potential,” Abebaw Alemayehu, the World Bank’s team leader for the project, said in a statement.

The program will also support projects in 73 towns and benefit more than 6.6 million people, he said.

Under a 2015-2020 development plan, Ethiopia plans to set up thousands of “rural development centers” in a bid to ease the influx of people to its capital, Addis Ababa.

Earlier this month, the World Bank also approved a $375 million loan to Ethiopia to fund a national electrification project.
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Alphabet’s Google is launching the Google News Initiative to weed out fake news online and during breaking news situations, it said in a blog post Tuesday.

Google said it plans to spend $300 million over the next three years to improve the accuracy and quality of news appearing on its platforms. 

The changes come as Google, Facebook and Twitter face a backlash over their role during the U.S. presidential election by allowing the spread of false and often malicious information that might have swayed voters toward Republican candidate Donald Trump.

In a separate blog post, Google said it was launching a tool to help subscribe to news publications.

Subscribe with Google will let users buy a subscription on participating news sites using their Google account and manage all their subscriptions in one place.

Google said it would launch the news subscription with the Financial Times, The New York Times, Le Figaro and The Telegraph among others. The search engine said it plans to add more news publishers soon.
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An Egyptian court on Tuesday ordered authorities to revoke the operating licenses of the Uber and Careem ride-hailing services and block their mobile apps and software.

The government and the companies are expected to appeal the administrative court verdict, which would prevent it from being implemented until a higher court weighs in.

The administrative court in Cairo ruled that it is illegal to use private vehicles as taxis.

Both companies provide smartphone applications that connect passengers with drivers who work as independent contractors.

In a brief statement posted on its Facebook account, Careem said it “hasn’t been notified officially to stop its operations” and was operating normally. There was no immediate comment from Uber.

Uber was founded in 2010 in San Francisco, and operates in more than 600 cities across the world. Careem was founded in 2012 in Dubai, and operates in 90 cities in the Middle East and North Africa, Turkey, and Pakistan.

The applications took off in Cairo, a city of 20 million people with near-constant traffic and little parking. The services have recently started offering rides on scooters and tuk-tuks, three-wheeled motorized vehicles that can sometimes squeeze through the gridlock.

The apps are especially popular among women, who face rampant sexual harassment in Egypt, including from some taxi drivers. Cairo’s taxi drivers are also notorious for tampering with their meters or pretending the meters are broken in order to charge higher rates.

In 2016, taxi drivers protested the ride-hailing apps. They have complained that Uber and Careem drivers have an unfair advantage because they do not have to pay the same taxes or fees, or follow the same licensing procedures.
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Indonesian president Joko “Jokowi” Widodo has instructed ministers to keep fuel prices stable over the next two years, said Energy Minister Ignasius Jonan, which would, in effect, continue a controversial fuel subsidy scheme that analysts say has negatively impacted growth and the environment. 

The Ministry said it would increase the per-liter subsidy for diesel and regular petrol from 500 Indonesian rupiah (about $0.35) to 700-1000 rupiah ($0.49-$0.70) while keeping pump prices unchanged.

The measure indicates how protectionist measures have been hard to shake for the initially reform-minded Jokowi, who made several inroads against subsidies in 2014 and 2015. 

Meanwhile, the rupiah continues to sink in the global market, due in part to Indonesia’s widening current-account deficit. On Monday, Credit Suisse said “the rupiah is among the most vulnerable emerging market currencies in Asia.”

Political Context

“Subsidizing fuel does tend to exacerbate currency depreciation, because the bulk of Indonesia’s petrol is imported,” said Kevin O’Rourke, a veteran Indonesian political analyst. “Fixed retail prices cause over-consumption, as the price remains the same even though the currency is declining; ordinarily, what should happen is that petrol prices rise as the currency declines, thereby discouraging consumption of the imports.”

In 2014, the year he was elected president, Jokowi raised fuel prices and capped the diesel subsidy within months of taking office. Last year he also pushed to phase out electricity subsidies, but was already facing pushback from consumers amid rising inflation. Consumer expectations are perhaps looming larger now that he is in the latter half of his term, and gearing up for a competitive reelection campaign in 2019. 

“Widodo hopes to keep retail prices stable through the April 2019 election, despite the gap between the Indonesia Crude Price (ICP) and the budget’s oil price assumption,” said O’Rourke. “Ostensibly, this subsidization aims to preserve consumer purchasing power; in reality, Widodo clearly hopes to avoid sacrificing popularity ahead of his re-election bid.” Ironically, he said, artificially low fuel prices end up creating inflation anyway, since people tend to then over-consume imported petrol, which further sinks the rupiah.

The subsidy may also imperil Indonesia’s public transport ambitions, said Jakarta-based energy policy researcher Lucky Lontoh. “Jokowi’s massive infrastructure development actually was started with a fuel subsidy reduction back in 2014, which freed some fiscal space needed to fund the infrastructure projects. More subsidies means the government will have less money to fund other development activities.” 

Environmental Impact

Fuel subsidies are considered a regressive form of spending because their benefits are captured by people wealthy enough to drive and own vehicles, said Paul Burke, an economist at Australian National University who focuses on energy and transportation. 

But they also aggravate traffic jams — including in cities like the notoriously traffic-choked Jakarta — air pollution, and oil dependence, said Burke, citing a recent paper he authored on the topic. 

Burke said Indonesia’s substantial progress on electricity subsidies are a hopeful sign and possible roadmap for fuel subsidy reform. 

“Over recent years, Indonesia has achieved substantial success in reducing electricity subsidies, by increasing some electricity tariffs to cost-reflective levels,” he said. “Poor households are among those that have been exempted from the reforms… [which] have made an important contribution to improving the efficiency of Indonesia’s electricity use. As electricity prices have increased, electricity use has shifted to a lower-growth trajectory. This has helped Indonesia to avoid the need to build too many expensive new power stations.”

In the fuel realm, Burke said a reform option that economists often suggest is a “fuel excise,” which is a tax on the sale of fuel and the opposite of a fuel subsidy. “Fuel excise would be a progressive form of revenue raising, would help to reduce pollution and traffic jams, and would help Indonesia reduce its budget deficit and fund key priorities.”

Fossil fuel subsidies have existed in Indonesia since its independence in 1949 and, per the International Energy Agency, accounted for nearly 20 percent of fiscal expenditure by the 1960’s. In that context, the reforms of modern-day Indonesia and the Jokowi administration are not inconsiderable: by 2014, about 3 percent of the GDP was spent on fossil fuel subsidies, and by 2016, after Jokowi’s initial spate of reforms, it was less than 1 percent. 

But, due to consumer expectations, the political climate, and the unique challenges of the fuel industry — Indonesia both has a lot of natural resources itself and a burgeoning consumer class — the current subsidy apparatus may prove sticky for the near future. 
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Air bags in some Hyundai and Kia cars failed to inflate in crashes and four people are dead. Now the U.S. government’s road safety agency wants to know why.

The National Highway Traffic Safety Administration says it’s investigating problems that affect an estimated 425,000 cars made by the Korean automakers. The agency also is looking into whether the same problem could happen in vehicles made by other companies.

In documents posted on its website Saturday , the safety agency says the probe covers 2011 Hyundai Sonata midsize cars and 2012 and 2013 Kia Forte compacts. The agency says it has reports of six front-end crashes with significant damage to the cars. Four people died and six were injured.

Electrical circuits 

The problem has been traced to electrical circuit shorts in air bag control computers made by parts supplier ZF-TRW. NHTSA now wants to know if other automakers used the same computer.

On Feb. 27, Hyundai recalled nearly 155,000 Sonatas because of air bag failures, which the company blamed on the short circuits.Hyundai’s sister automaker Kia, which sells similar vehicles, has yet to issue a recall.

In a statement Saturday, Kia said that it has not confirmed any air bag non-deployments in its 2002-2013 Kia Forte models arising from “the potential chip issue.” The company said it will work with NHTSA investigators.

“Kia will act promptly to conduct a safety recall, if it determines that a recall would be appropriate,” the company said.

But a consumer complaint cited in NHTSA’s investigation documents said Kia was informed of a crash near Oakland in which air bags failed to deploy and a passenger was killed.

In October 2015, the complainant told NHTSA that a 2012 Forte was involved in a serious front-end crash that occurred in July 2013. A passenger was killed and the driver was injured. According to the complaint, Kia was notified, the air bag computer was tested and it was “found not to be working.”

Kia spokesman James Bell said he could not comment beyond the company’s statement.

Hyundai recall

In addition, no deaths or injuries were disclosed in Hyundai’s recall documents, which were posted by NHTSA in early March.

Hyundai spokesman Jim Trainor says the problem occurred in rare high-speed head-on collisions that were offset from the center of the vehicles. “It’s very unusual to have that kind of collision,” he said Saturday.

Dealers will consider offering loaner cars to owners until the problem can be repaired, he said. “We certainly would do everything we can to help our customers,” Trainor said.

Hyundai said in a statement that the air bag control circuitry was damaged in three crashes and a fourth crash is under investigation.

ZF-TRW said in a statement that it is prevented by confidentiality agreements from identifying other automakers that bought its air bag control computers. The company said it is working with customers and supports the NHTSA investigation.

According to NHTSA, Hyundai investigated and found the problem was “electrical overstress” in the computers. The company didn’t have a fix developed at the time but said it was investigating the problem with ZF-TRW. Hyundai does not yet have a fix for the problem but said it expects the Sonata recall to start April 20. The problem also can stop the seat belts from tightening before a crash.

In the documents, NHTSA said it understands that the Kia Fortes under investigation use similar air bag control computers made by ZF-TRW. The agency noted a 2016 recall involving more than 1.4 million Fiat Chrysler cars and SUVs that had a similar problem causing the air bags not to deploy. Agency documents show those vehicles had air bag computers made by ZF-TRW.
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The pot revolution is alive and well in the state of Colorado where recreational cannabis has been legal since 2014. While the full impact of legal marijuana in Colorado has yet to be determined, what is clear is that cannabis has become a giant moneymaker for the state. And as Paula Vargas reports from Denver, women entrepreneurs — weed warriors, as some have called them — are leading the way.
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Britain should consider a limited extension to its exit process from the European Union if needed to ensure details of its future relationship with the

bloc are agreed, a committee of lawmakers said in a report.

Prime Minister Theresa May formally notified the EU of Britain’s intention to leave by triggering Article 50 of the membership treaty on March 29, 2017, setting the clock ticking on a two-year exit process.

Britain has said it wants to have the basis of a trade deal set out with the EU by October, but the Exiting the EU Committee said in a report published Sunday that deadline would be tight.

“In the short time that remains, it is difficult to see how it will be possible to negotiate a full, bespoke trade and market access agreement, along with a range of other agreements, including on foreign affairs and defense cooperation,” the committee said.

“If substantial aspects of the future partnership remain to be agreed in October, the government should seek a limited extension to the Article 50 time to ensure that a political declaration on the future partnership that is sufficiently detailed and comprehensive can be concluded.”

The report also said it should be possible to prolong, if necessary, the length of any post-Brexit transition that’s agreed upon by Britain and the EU.

Britain has said it is confident it can reach a deal on the transition period at an EU summit this month. It expects the transition to last around two years after its departure date, although the European Union has said it should be shorter,

ending on Dec. 31, 2020.

The Exiting the EU committee, made up of lawmakers from all the main political parties, also called on the government to present a detailed plan on how a “frictionless” border between Northern Ireland and the Republic of Ireland would work.

The Irish border is a key sticking point in negotiations between the U.K. and the EU, as Britain has said it wants to leave the customs union but does not want a “hard” land border with customs checks.
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A former midlevel employee of German industrial giant Siemens pleaded guilty Thursday of conspiring to pay tens of millions of dollars to Argentine officials to win a $1 billion contract to create national ID cards.

Eberhard Reichart, 78, who worked for Siemens from 1964 to 2001, appeared in federal court in New York to plead guilty to one count of conspiring to violate the anti-bribery Foreign Corrupt Practices Act and to commit wire fraud.

Reichart was arraigned last December in a three-count indictment filed in December 2011 charging him and seven other Siemens executives and agents with participating in the decadelong scheme, the Justice Department said Thursday. 

The men were accused of conspiring to pay more than $100 million in bribes to high-level Argentine officials to win the contract in 1998. 

As part of his guilty plea, Reichart admitted in court that he engaged in the bribery conspiracy and that he and his co-conspirators used shell companies to conceal the illicit payments to Argentine officials.

The Argentine government terminated the contract in 2001, but the Siemens executives “sought to recover the profits they would have reaped” through an illicitly obtained contract, said Preet Bharara, former U.S. attorney for the Southern District of New York, in 2011. 

“Far too often, companies pay bribes as part of their business plan, upsetting what should be a level playing field and harming companies that play by the rules,” acting Assistant Attorney General John Cronan said Thursday.

In 2008, Siemens pleaded guilty of violating the Foreign Corrupt Practices Act in connection with the Argentine bribery scheme, agreeing to pay the Justice Department and Securities and Exchange Commission $800 million in criminal and civil penalties.

The company paid the German government another $800 million to settle similar charges brought by the Munich Public Prosecutor’s Office.

The Foreign Corrupt Practices Act bars U.S. companies and foreign firms with a presence in the U.S. from paying bribes to foreign officials.

Last year, 11 companies paid just over $1.92 billion to resolve charges brought under the anti-bribery law, according to data compiled by the FCPA Blog.
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White House trade adviser Peter Navarro said Thursday that President Donald Trump would soon consider new punitive measures against China for its alleged “theft” of intellectual property.

U.S. officials, according to news accounts, are considering imposing as much as $60 billion in annual tariffs against Chinese information technology, telecommunications and consumer exports to the U.S. in an effort to trim its chronic annual trade deficit with Beijing by $100 billion. Last year, the U.S. says it imported Chinese goods worth $375 billion more than it exported to China.

“In the coming weeks, President Trump is going to have on his desk some recommendations,” Navarro told CNBC. “This will be one of the many steps the president is going to courageously take in order to address unfair trade practices.

“I don’t think there’s a single person … on Wall Street that will oppose cracking down on China’s theft of our intellectual property or their forced transfer,” Navarro said.

The new tariffs and other measures would be in addition to the 25 percent tariff on steel imports to the U.S. and 10 percent levy on aluminum that Trump announced last week, some of which affect China.

​At a political fundraiser Wednesday, Trump attacked several trading partners for the billions of dollars in trade surpluses they have built up against the U.S. He contended that China had become an economic power — the world’s second biggest economy — because of its trade surplus with the United States.

China warned it would likely retaliate against any new tariffs the U.S. imposes.

Foreign minister spokesman Lu Kang said, “History has proven that a trade war is in no one’s interest.”

He said that “if an undesirable situation arises, China has the intention of safeguarding its legitimate rights.”

Trump’s new tariffs on metal imports have led in recent days to volatility on U.S. stock exchanges, with wide day-to-day swings of hundreds of points in stock indexes. 

But Navarro said the U.S. can impose the tariffs in a way that can be good for the American people and good for the global trading system. We can do this in a way that is peaceful and will improve and strengthen the trading system. … Everybody on Wall Street needs to understand: Just relax.”
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HSBC will reveal a gender pay gap of 59 percent at its main U.K. banking operation, the biggest yet disclosed by a British bank, according to a copy of the lender’s report on the subject seen by Reuters on Thursday ahead of its publication.

The bank will also disclose a mean gender bonus gap of 86 percent at HSBC Bank Plc, which is the biggest of the lender’s seven entities in Britain and employs 23,507 people.

A spokeswoman for the bank confirmed the contents of the report.

The gender pay gap is the biggest yet reported by a British financial firm, according to government data, with some firms yet to provide figures ahead of an April deadline set by Prime Minister Theresa May last year.

Almost 50 years since the passage of Britain’s equal pay act, the continued gulf in earnings between men and women has attracted significant public attention over the past year or so.

In common with other banks, HSBC said its pay gap was largely accounted for by the bank having fewer women in senior roles.

The gender pay gap measures the difference between the average salary of men and women, calculated on an hourly basis.

HSBC said women held only 23 percent of senior leadership positions in its workforce in Britain, despite accounting for more than half of total staff.

The bank said it was taking a number of steps to reduce the pay gap, including committing to an aspirational target of women holding 30 percent of senior roles by 2020.

Last month, Asia-focused Standard Chartered reported a gap of 30 percent in Britain, while Virgin Money — the only major UK lender run by a woman — said its female staff earned on average 32.5 percent less per hour than its male workforce.

Lloyds Banking Group and Royal Bank of Scotland reported gender pay gaps of 32.8 percent and 37 percent respectively.

Barclays said last month it paid women in its international division, which houses its investment bank, on average 48 percent of what men earned in fixed pay.

The pay gaps have drawn criticism from lawmakers and are likely to spur questions from investors in the upcoming season for shareholder meetings, with stock prices and future earnings potential strongly linked to banks’ efforts to revive their reputations in the wake of the global financial crisis.
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Cooking is Chris Spear’s passion. He’s been professionally cooking since he was 16. Over the years, he worked for big restaurants and reached a point where he had almost 100 employees reporting to him. That’s when he missed flexibility and wanted to be more creative. So, he quit working for restaurants and founded his own catering company, Perfect Little Bites in Frederick, Maryland.

“Not that having your business is easy, but I want to have the flexibility to say, ‘It’s Valentine’s Day, and it’s more important to me to stay home with my wife,’ or to be home cooking for someone. I really wanted something that I felt was mine,” Spear explained.

Spending long hours in the kitchen doesn’t tire Spear, but he had often been concerned that becoming an independent chef would make him feel lonely. That inspired him to found Chefs Without Restaurants, an online resource for chefs. 

“I’ve been thinking about the Chefs Without Restaurants for about five years now, even before I took Perfect Little Bites full time, because I kept thinking about, ‘Well, when I do this full time, who are going to be my colleagues? Who are going to be the people who I can bounce ideas off? Who am I going to be able to [get to] do things like cater an event that’s maybe outside my range of 30 people? Like, do I have a resource where I can pull in one or two other people?’ ” he said. ” … And what I started to see was other independent chefs were referring customers to me, [and] I started to do that back to them. I kind of thought, ‘There’s got to be an easier way to do this.’ ”

Dozens have joined

Since the group started last January around 100 chefs have joined it.

“We’re caterers,” he said. “We’re personal chefs. We run food trucks. We have awesome food specialty shops.” Spear said he wanted to find an arrangement that would be beneficial to all such groups but didn’t cost them any money. 

So now he has a Facebook group where he can post information about, for instance, a potential customer who wants to arrange a dinner in a given location and within a certain price range, and he can offer interested chefs more information.

Customers can also benefit from this network. Spear said he’s building a website where customers will be able to check out profiles of the Chefs Without Restaurants members, learn about their specialties and see what kinds of events they can cater, large or small.

Lana and Bobby Browner are a wife-and-husband team who own their own catering company, Bent and Bent Events, in Frederick.

“We’ve been doing this for five years, since he graduated from a culinary school,” Lana Browner said.

“We specialize in Creole cuisine, Caribbean cuisine. So we blend flavors and bring a nice flavor, a different flavor in the field of food in Frederick County,” Bobby Browner said.

When the Browners heard about Spear’s group, they decided to become members. 

“I think the biggest hurdle for a lot of chefs is that they don’t really form an alliance because they’re all kind of competing with each other, but you don’t have that in this group,” Lana Browner said. “What we’ve experienced so far is a lot of learning about different chefs in the area. It’s even been interesting to get feedback from chefs that are not in this immediate area.”

Her husband added, “It’s a really competitive field,” but there’s “a lot of camaraderie, a lot of openness and a lot of sharing” within the group.

Shared kitchen

The group is also bringing more business to local facilities, like a shared kitchen called Maryland Bakes where members often meet and work. Terri Rowe, a food entrepreneur and owner of Maryland Bakes, said the group brings more energy to the small food businesses in the area.

“They bring connections,” she said. “They bring a variety of talents and gifts. They bring creative ideas and just the whole network of independent people joining together. So it’s a big community.”

The whole local food community seems to embrace Chefs Without Restaurants.

Oil & Vinegar Frederick is one of the local shops Spear likes. The place often hosts events to introduce cooking ideas and chefs to their customers.

Store owner Sharon Streb said small businesses should help one another succeed. 

When other chefs and businesses come to her store, “they get in front of our customers and hopefully we get in front of their customers. That’s a win-win for both of us,” she said. “It’s tough out there for a small business, and not a lot of small businesses succeed. It’s important that we can work together and be successful, both of us.”

That’s the goal for Spear, who wants to carve out a space for independent chefs on the food map in the area.
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U.S. Trade Representative Robert Lighthizer said Wednesday that the United States would challenge Indian government export subsidies because they hurt American workers and manufacturers.

Lighthizer said he had requested “dispute settlement consultations” with the Indian government at the World Trade Organization because the subsidies allow India to sell goods at lower prices.

He said his office “will continue to hold our trading partners accountable by vigorously enforcing U.S. rights under our trade agreements and by promoting fair and reciprocal trade through all available tools, including the WTO.”

The announcement is the latest step in President Donald Trump’s trade offensive.The White House has announced tariffs on imported steel and aluminum as well as on imports of solar panels and washing machines.

Lighthizer’s office said India offers benefits valued at $7 billion annually to domestic exporters, such as duty, tax and fee exemptions. Producers of steel, information technology and textiles are among the recipients.

Consultations are the first step in WTO’s dispute settlement process, but Trump has said he does not favor resorting to dispute resolutions at the WTO, where he contends the United States is at a disadvantage.

The administration has instead concentrated efforts on tariffs and remedies as allowed under domestic U.S. law.
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General Motors, Fiat Chrysler, Volkswagen and Mercedes all knew of problems with dangerous exploding Takata air bag inflators years before issuing recalls, according to three class actions filed Wednesday with the federal court in Miami.

The lawsuits cite company documents obtained through previous legal actions against other automakers over faulty Takata inflators. The plaintiffs allege that automakers were informed of inflator defects during tests but delayed taking action. Allegations against GM are among the most serious. Takata documents showed that GM employees expressed concerns about inflators rupturing as early as 2003.

Messages were left Wednesday seeking comment from GM, VW and Mercedes. Fiat Chrysler declined comment, saying it had not been served with the lawsuit.

Takata uses the chemical ammonium nitrate to create small explosions to inflate air bags. But the chemical can deteriorate when exposed to high temperatures and airborne moisture. That causes it to explode with too much force, blowing apart a metal canister and hurling shrapnel. At least 22 people have died worldwide and more than 180 have been hurt.

The problem touched off the largest series of automotive recalls in U.S. history, with 19 automakers having to recall up to 69 million inflators in 42 million vehicles. The problem brought a criminal conviction and fine against Takata and forced the Japanese company into bankruptcy protection.

The lawsuits, which consolidate individual claims that were filed previously, allege that owners paid higher prices for their vehicles than they would have if the defect had been disclosed.

They allege that manufacturers picked Takata to supply inflators because the cost was less than other air bag makers who used different, less volatile chemicals as propellants. According to the lawsuits, manufacturers had employees who questioned the quality and performance of Takata’s inflators well before any vehicles were recalled.

“These auto manufacturers were well aware of the public safety risks posed by Takata’s airbags long ago, and still waited years to disclose them to the public and take action,” Peter Prieto, lead counsel for the plaintiffs, said in a statement. The lawsuits “are an important step forward in holding them accountable.”

Early concerns

In an April 2003 communication with Takata, GM was concerned about “ballistic variability,” which is a tendency for the air bags to either underinflate or explode when deployed, the lawsuit against GM said. A GM engineer raised concerns about inadequate testing, moisture control and the inability of Takata to meet GM specifications after a 2003 visit to Takata’s factory in Moses Lake, Washington, according to the lawsuit.

In 2004, Takata employees met with GM officials about a tendency for the inflators to shoot flames when they ruptured, and in March of 2006, Takata reported that inflators tested for GM vehicles continued to show “aggressive behavior,” including the escape of “molten propellant” when they ruptured. A Takata employee admitted “we cannot get good results” with the inflator design, the lawsuit stated.

Yet GM didn’t issue any recalls until June of 2014 when it recalled 29,000 Chevrolet Cruze compact cars from the 2013 and 2014 model years, according to the lawsuit. That recall came after Takata reported three exploding inflators in 2010. “Defendants did nothing to meaningfully investigate the problem, notify the appropriate regulators or notify the class [car owners],” the lawsuit stated.

GM also received reports of real-world problems in 2011 and 2014, including one case in which a Cruze driver was blinded in one eye by an exploding inflator, according to the lawsuit. GM and Takata blamed the trouble on a manufacturing problem instead of the deteriorating ammonium nitrate. “Rather than publicize the truth, both Takata and New GM blamed the ruptures on a manufacturing problem,” the lawsuit alleged.

Old GM, the company that existed before seeking bankruptcy protection in 2009, knew of the problems, and New GM, the company that emerged from bankruptcy, kept employees who knew and had the same knowledge, according to the lawsuit.

More recalls

Volkswagen, the lawsuit alleged, had repeated quality issues with Takata dating to 2003, even rejecting products after an audit. Yet no recalls were issued until 2016, the plaintiffs claimed. Daimler AG, maker of Mercedes-Benz vehicles, had concerns about the integrity of Takata inflators in 2003, according to company emails. In 2004, Mercedes engineers agreed to “forego key performance variables” and allow use of Takata inflators, the lawsuit stated. The company didn’t do any recalls until 2016.

Fiat Chrysler didn’t issue its first recall until 2014, even though its engineers expressed concerns about Takata inflators during the early 2000s, the lawsuit stated.

Last year Toyota, BMW, Mazda, Subaru, Nissan and Honda settled similar economic loss class actions for millions of dollars.
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Behind the U.S. move to block Singapore-based Broadcom’s hostile bid for U.S. chipmaker Qualcomm lies a new global struggle for influence over next-generation communications technology — and fears that whoever takes the lead could exploit that advantage for economic gain, theft and espionage.

In the Broadcom-Qualcomm deal, the focus is on so-called “5G” wireless technology, which promises data speeds that rival those of landline broadband now. Its proponents insist that 5G, the next step up from the “4G” networks that now serve most smartphones, will become a critical part of the infrastructure powering everything from self-driving cars to the connected home.

5G remains in the early stages of development. Companies including Qualcomm, based in San Diego, and China’s Huawei have been investing heavily to stake their claim in the underlying technology. Such beachheads can be enormously valuable; control over basic technologies and their patents can yield huge fortunes in computer chips, software and related equipment.

“These transitions come along almost every decade or so,” said Jon Erensen, research director for semiconductors at research firm Gartner. “The government is being very careful to ensure the U.S. keeps its leadership role developing these standards.”

President Donald Trump said late Monday that a takeover of Qualcomm would imperil national security, effectively ending Broadcom’s $117 billion buyout bid. Broadcom said that it is studying the order and that it doesn’t believe it poses any national security threat to the U.S.

Higher stakes

It’s the second recent U.S. warning shot across the bow of foreign telecom makers. At a Senate Intelligence Committee meeting in February, FBI Director Christopher Wray said any company “beholden to foreign governments that don’t share our values” should not be able to “gain positions of power” inside U.S. telecommunications networks.

“That provides the capacity to exert pressure or control over our telecommunications infrastructure, it provides the capacity to maliciously modify or steal information and it provides the capacity to conduct undetected espionage,” he said.

Lawmakers in the U.S. House introduced a bill on Jan. 9 that would prohibit government purchases of telecoms equipment from Huawei Technologies and smaller rival ZTE, citing their ties to the Chinese military and backing from the ruling Communist Party. A few years earlier, a congressional panel recommended phone carriers avoid doing business with Huawei or ZTE.

The stakes are even higher in the 5G race. “Qualcomm/Broadcom is like the Fort Sumter of this technology battle,” said GBH Insights analyst Dan Ives, referring to the battle that kicked off the Civil War.

Although its name isn’t widely known outside the technology industry, San Diego-based Qualcomm is one of the world’s leading makers of the processors that power many smartphones and other mobile devices. Qualcomm also owns patents on key pieces of mobile technology that Apple and other manufacturers use in their products.

Compared to earlier generations of wireless technology, “we’re seeing China emerge and start to play a bigger role in the standards developing process,” Erensen said. Given a wave of consolidation in the telecom-equipment industry, fewer companies are involved “and the stakes are bigger,” he said.

National security

The Committee on Foreign Investment in the United States, which reviews the national security implications of foreign investments in U.S. companies, cited concerns about Broadcom’s penchant for cutting costs such as research spending. That could lead to Qualcomm losing its leadership in telecom standards, the committee wrote in a letter earlier in March.

Should that happen, Chinese companies such as Huawei, which the CFIUS has previously expressed concerns about, could take a larger, or even a dominant, role in setting 5G technology and standards and practices. That’s where national security concerns come in.

“Over time, that would mean U.S. government and U.S. technology companies could lose a trusted U.S. supplier that does not present the same national security counterintelligence risk that a Chinese supplier does,” said Brian Fleming, an attorney at Miller & Chevalier and former counsel at the Justice Department’s national security division.

Blocking the deal doesn’t eliminate Chinese influence on 5G development, of course. But it might slow it down, Fleming said: “They honestly believe they are helping to protect national security by doing this.”
…

Sao Paulo investment firm SouthRock Capital has signed an agreement with Starbucks that gives it the right to develop and operate branches of the Seattle-based chain in Brazil, the companies said late on Monday.

With the agreement, whose value was not disclosed, all of Starbucks’ retail operations in Latin America are now wholly licensed rather than directly managed, the companies said.

SouthRock founder Ken Pope said in a statement the fund would eye expansion opportunities in new and existing markets.

Starbucks now has 113 stores across the populous states of Sao Paulo and Rio de Janeiro.

“With Starbucks, we see continued opportunities for growth in existing markets … as well as new markets like Brasilia and the South,” he said.

SouthRock, founded in 2015, also owns Brazil Airport Restaurants, which operates in the country’s biggest airports.

Shares in Starbucks opened up 0.5 percent but closed down 0.58 percent. The S&P 500 Index fell 0.64 percent.
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“Dona Edir, Dona Edir” — the call is heard frequently in the narrow lanes of Canaa, a slum on the outskirts of Rio de Janeiro.

It is for Edir Dariux Teixeira, who is well known among the residents, having spent more than a third of her life trying to improve infrastructure and basic services in the ramshackle settlement.

At the heart of that fight are legal property titles to the residents’ homes — or, more accurately, the lack of them.

“Without these documents we have no rights,” she told the Thomson Reuters Foundation, sitting close to a fan to alleviate the near-40C (104°F) heat funneling from her asbestos roof.

Debates on how to manage property rights in the world’s informal settlements are becoming ever more pressing, as millions of people move into cities from rural areas every year and many end up in fast-growing slums.

Rio has about 1,000 slums, known locally as favelas. They are home to nearly one in four of the city’s population and typically lack a range of infrastructure and services, experts say.

In Canaa, having title would bring certainty of tenure, and also help to get services provided: sewerage, basic sanitation, and tarred streets, said Teixeira.

“I am anxious. I pray every day [for land titles],” the 59-year-old said.

When she moved to the area 22 years ago, there was a lack of all basic infrastructure in Canaa, including clean water, pavements and lighting.

Teixeira realized change had to be driven by the residents’ themselves and took the lead in trying to improve the area.

“There was nothing here. It was all jungle,” said housewife Glaucia Milani, who has been living in the favela for 25 years. “Now things are getting better because of Dona Edir’s help.”

Milani said apart from helping residents to get legal title to their land, Teixeira has been organising food and clothes donations for the favela and its 300 families.

“Dona Edir is a great mother to us. Anything she can help us, she helps… Dona Edir solves everything for us,” Milani, 31, said. “Dona Edir is a warrior.”

Complex situation

Getting land titles for the residents is no easy task, Teixeira said, not least because some residents have bought land from private owners, while others are squatting.

Her own plot of land was donated by an uncle of her ex-husband but neither Teixeira nor the other residents have official proof of ownership.

ITERJ, the government body in charge of managing land in the state of Rio de Janeiro and responsible for Teixeira’s request to get titles for Canaa’s residents, did not respond to requests for comment.

Most of the favela’s streets got temporary pavements about five years ago but Teixeira said it happened only after she asked a politician for help because taxis were refusing to enter Canaa because the roads were full of potholes.

Despite Teixeira’s efforts, the residents in the favela about 65 kilometers (40 miles) from Rio’s city center are still waiting for the streets to be fully paved, sidewalks to be built and manholes to be constructed.

Teixeira has asked the city to fully pave the streets, provide sewerage infrastructure and a health post for the favela.

In emailed comments to the Thomson Reuters Foundation, Rio’s city hall said the favela was “urbanized” four years ago but did not immediately respond to requests for details about which services were provided to the area.

Fighting for justice

A “very shocking scene” at school when Teixeira was eight years old prompted her decision to dedicate her life to fighting justice, she said.

While she and a boy were having a snack during a school break, another girl asked the boy to give her a piece.

“The boy said: only if you spread your legs,” she said. “Then she immediately spread her legs and … he gave her a bite. That broke my heart.”

At 15, Teixeira was raped and later witnessed the rape of a friend, experiences she said strengthened her resolve to help women.

Teixeira has been working for many years as a volunteer at a charity that distributes food in Rio’s poor neighborhoods, including Canaa.

She was honored for her work with a prize from the Federação de Mulheres Fluminenses, a Rio-based women’s federation.

Meanwhile, Teixeira, who survives on her father’s pension and cleans houses to make money, spends whatever she can of her income — equivalent to $300 a month — on building a school in the patio of her house.

“I do the construction works myself. When there is any money left I pay a professional to do the harder things,” she said.

Beyond literacy, her school will offer a range of classes: cooking, sewing, handicrafts and theater.

“That is my dream. … My dream is to take the kids off the street … because they have nothing to do [here],” she said in tears.

“There are lots of volunteers. What is missing is money to finish the school.”

Teixeira hopes the city will officially recognize Canaa as the favela’s name — it is the Portuguese version of Canaan and was chosen by her in reference to a passage from the Bible of a land promised by God to chosen people.

“We have to have faith. The faith in God is what keeps me standing. And the victories make me keep going,” said Teixeira.
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The daily commute from Mexico to California farms is the same as it was before Donald Trump became president. Hundreds of Mexicans cross the border and line the sidewalks of Calexico’s tiny downtown by 4 a.m., napping on cardboard sheets and blankets or sipping coffee from a 24-hour doughnut shop until buses leave for the fields.

For decades, cross-border commuters have picked lettuce, carrots, broccoli, onions, cauliflower and other vegetables that make California’s Imperial Valley “America’s Salad Bowl” from December through March. As Trump visits the border Tuesday, the harvest is a reminder of how little has changed despite heated immigration rhetoric in Washington.

Trump will inspect eight prototypes for a future 30-foot border wall that were built in San Diego last fall. He made a “big, beautiful wall” a centerpiece of his campaign and said Mexico would pay for it.

But border barriers extend the same 654 miles (1,046 kilometers) they did under President Barack Obama and so far Trump hasn’t gotten Mexico or Congress to pay for a new wall.

Trump also pledged to expand the Border Patrol by 5,000 agents, but staffing fell during his first year in office farther below a congressional mandate because the government has been unable to keep pace with attrition and retirements. There were 19,437 agents at the end of September, down from 19,828 a year earlier.

In Tijuana, tens of thousands of commuters still line up weekday mornings for San Diego at the nation’s busiest border crossing, some for jobs in landscaping, housekeeping, hotel maids and shipyard maintenance. The vast majority are U.S. citizens and legal residents or holders of “border crossing cards” that are given to millions of Mexicans in border areas for short visits. The border crossing cards do not include work authorization but some break the rules.

Even concern about Trump’s threat to end the North American Free Trade Agreement is tempered by awareness that border economies have been integrated for decades. Mexican “maquiladora” plants, which assemble duty-free raw materials for export to the U.S., have made televisions, medical supplies and other goods since the 1960s.

“How do you separate twins that are joined at the hip?” said Paola Avila, chairwoman of the Border Trade Alliance, a group that includes local governments and business chambers. “Our business relationships will continue to grow regardless of what happens with NAFTA.”

Workers in the Mexicali area rise about 1 a.m., carpool to the border crossing and wait about an hour to reach Calexico’s portico-covered sidewalks by 4 a.m. Some beat the border bottleneck by crossing at midnight to sleep in their cars in Calexico, a city of 40,000 about 120 miles (192 kilometers) east of San Diego. 

Fewer workers make the trek now than 20 and 30 years ago. But not because of Trump. 

Steve Scaroni, one of Imperial Valley’s largest labor contractors, blames the drop on lack of interest among younger Mexicans, which has forced him to rely increasingly on short-term farmworker visas known as H-2As. 

“We have a saying that no one is raising their kids to be farmworkers,” said Scaroni, 55, a third-generation grower and one of Imperial Valley’s largest labor contractors. Last week, he had two or three buses of workers leaving Calexico before dawn, compared to 15 to 20 buses during the 1980s and 1990s.

Crop pickers at Scaroni’s Fresh Harvest Inc. make $13.18 an hour but H-2As bring his cost to $20 to $30 an hour because he must pay for round-trip transportation, sometimes to southern Mexico, and housing. The daily border commuters from Mexicali cost only $16 to $18 after overhead.

Scaroni’s main objective is to expand the H-2A visa program, which covered about 165,000 workers in 2016. On his annual visit to Washington in February to meet members of Congress and other officials, he decided within two hours that nothing changed under Trump. 

“Washington is not going to fix anything,” he said. “You’ve got too many people – lobbyists, politicians, attorneys – who make money off the dysfunction. They make money off of not solving problems. They just keep talking about it.”

Jose Angel Valenzuela, who owns a house in Mexicali and is working his second harvest in Imperial Valley, earns more picking cabbage in an hour than he did in a day at a factory in Mexico. He doesn’t pay much attention to news and isn’t following developments on the border wall.

“We’re doing very well,” he said as workers passed around beef tacos during a break. “We haven’t seen any noticeable change.”

Jack Vessey, whose family farms about 10,000 acres in Imperial Valley, relies on border commuters for about half of his workforce. Imperial has only 175,000 people and Mexicali has about 1 million, making Mexico an obvious labor pool.

Vessey, 42, said he has seen no change on the border and doesn’t expect much. He figures 10 percent of Congress embraces open immigration policies, another 10 percent oppose them and the other 80 percent don’t want to touch it because their voters are too divided.

“It’s like banging your head against the wall,” he said. 
…

Chile’s new government is preparing belt-tightening measures after inheriting a larger-than-anticipated fiscal deficit from its predecessor, but the measures will stop short of “mega-adjustments,” Finance Minister Felipe Larrain said on Monday.

Conservative billionaire Sebastian Pinera took office on Sunday vowing to combat economic “stagnation” and calling for a return to “fiscal equilibrium” as he seeks to transform Chile into a developed nation within a decade.

“We’re in a period of tight budgets, with levels of public debt that have doubled, which means we must begin with austerity measures, followed by a reassigning resources, in order to finance the president’s program,” Larrain told reporters as he entered the finance ministry for his first day on the job.

Shortly before leaving office, outgoing President Michelle Bachelet’s government reported it had left a fiscal deficit of 2.1 percent of gross domestic product, instead of 1.7 percent as targeted.

Chile’s Congress this year authorized an increase in public spending of 3.9 percent, which Pinera had previously criticized as “high.”

“These austerity measures, and the wise use of resources, are always welcome and are necessary. But we’re not talking about mega-adjustments, we’re talking about austerity measures,” Larrain said.

During his campaign, Pinera, who also governed from 2010 to 2014, said he hoped to guide the country to fiscal equilibrium within six to eight years.
…

U.S. President Donald Trump is blocking Singapore-based Broadcom, maker of computer and smartphone chips, from taking over U.S. chipmaker Qualcomm.

Trump cited national security grounds in stopping the takeover, following the recommendation of the Committee on Foreign Investment in the United States (CFIUS). The committee reviews national security implications when foreign entities purchase U.S. corporations.

The president’s order said there is “credible evidence” that the takeover “might take action that threatens to impair the national security of the United States.”

Broadcom made an unsolicited bid last year to take over Qualcomm for $117 billion.

The company has been in the process of moving its legal headquarters from Singapore to the United States to help it win approval for the takeover.

Qualcomm, which is based in San Diego, has emerged as one of the biggest competitors to Chinese companies, such as Huawei Technologies, making it an attractive asset for potential buyers in the semiconductor industry.

Companies in the industry are racing against each other to develop 5G wireless technology to transmit data at faster speeds.
…

Labor strikes. Nationwide protests. Bank failures.

In recent months, Iran has been beset by economic problems despite the promises surrounding the 2015 nuclear deal it struck with world powers.

Its clerically overseen government is starting to take notice. Politicians now offer the idea of possible government referendums or early elections. Even Supreme Leader Ayatollah Ali Khamenei acknowledged the depths of the problems ahead of the 40th anniversary of Iran’s Islamic Revolution.

“Progress has been made in various sectors in the real sense of the word; however, we admit that in the area of ‘justice’ we are lagging behind,” Khamenei said in February, according to an official transcript. “We should apologize to Allah the Exalted and to our dear people.”

Whether change can come, however, is in question.

​An economy run by the state

Iran today largely remains a state-run economy. It has tried to privatize some of its industries, but critics say they have been handed over to a wealthy elite that looted them and ran them into the ground.

One major strike now grips the Iran National Steel Industrial Group in Ahvaz, in the country’s southwest, where hundreds of workers say they haven’t been paid in three months. Authorities say some demonstrators have been arrested during the strike.

More than 3.2 million Iranians are jobless, government spokesman Mohammad-Bagher Nobakht has said. The unemployment rate is more than 11 percent.

Banks remain hobbled by billions of dollars in bad loans, some from the era of nuclear sanctions and others tainted with fraud. The collapse last year of the Caspian Credit Institute, which promised depositors the kinds of returns rarely seen outside of Ponzi schemes, showed the economic desperation faced by many in Iran.

​Or in security services’​ grip

Meanwhile, much of the economy is in the grip of Iran’s security services.

The country’s powerful Revolutionary Guard paramilitary force, which answers only Khamenei and runs Iran’s ballistic missile program, controls 15 to 30 percent of the economy, analysts say.

Under President Hassan Rouhani, a relatively moderate cleric whose government reached the nuclear accord, there has been a push toward ending military control of some businesses. However, the Guard is unlikely to give up its power easily.

Some suggest hard-liners and the Guard may welcome the economic turmoil in Iran as it weakens Rouhani’s position. His popularity has slipped since winning a landslide re-election in May 2017, in part over the country’s economic woes.

Analysts believe a hard-line protest in late December likely lit the fuse for the nationwide demonstrations that swept across about 75 cities. While initially focused on the economy, they quickly turned anti-government. At least 25 people were killed in clashes surrounding the demonstrations, while nearly 5,000 reportedly were arrested.

​A rare referendum?

In the time since, Rouhani has suggested holding a referendum, without specifying what exactly would be voted on.

“If factions have differences, there is no need to fight, bring it to the ballot,” Rouhani said in a speech Feb. 11. “Do whatever the people say.”

Such words don’t come lightly. There have been only two referendums since the Islamic Revolution. A 1979 referendum installed Iran’s Islamic republic. A 1989 constitutional referendum eliminated the post of prime minister, created Iran’s Supreme National Security Council and made other changes.

A letter signed by 15 prominent Iranians published a day after Rouhani’s speech called for a referendum on whether Iran should become a secular parliamentary democracy. The letter was signed by Iranians living inside the country and abroad, including Nobel Prize laureate Shirin Ebadi.

“The sum of the experiences of the last 40 years show the impossibility of reforming the Islamic Republic, since by hiding behind divine concepts … the regime has become the principal obstacle to progress and salvation of the Iranian nation,” read the letter, which was posted online.

But even among moderates in Iran’s clerical establishment, there seems to be little interest in such far-reaching changes, which would spell the end of the Islamic Republic. Hard-liners, who dominate the country’s security services, are adamantly opposed.

“I am telling the anti-Islamic government network, the anti-Iranians and those runaway counterrevolutionaries … their wish for a public referendum will never come true,” Tehran Friday prayer leader Ayatollah Ahmad Khatami said Feb. 15, according to the state-run IRNA news agency.

​Take responsibility

Yet there are signs that authorities realize that something will have to give. Khamenei’s apology in February took many by surprise, especially as the country’s true hard-liners believe he is the representative of God on earth.

Khamenei’s apology came after a letter from Mehdi Karroubi, an opposition activist who remains under house arrest, demanding that the supreme leader take responsibility for failures.

“You were president for eight years and you have been the absolute ruler for almost 29 years,” Karroubi wrote in the letter, which was not reported on by state media. “Therefore, considering your power and influence over the highest levels of state, you must accept that today’s political, economic, cultural and social situation in the country is a direct result of your guidance and administration.”

Iran’s former hard-line President Mahmoud Ahmadinejad, blamed by many for the country’s economic woes, has come out for early elections. He also demanded they be “free and fair,” while continuing his own campaign against Khamenei, whom he ignored in his attempt to run in the 2017 presidential election.

However, Ahmadinejad’s action drew immediate criticism, as his own widely disputed 2009 re-election sparked unrest and violence that killed dozens.
…

China said Sunday it does not intend to ignite a trade war with the U.S. because the move would be disastrous for the entire world.

“There are no winners in a trade war,” Minister of Commerce Zhong Shan said on the sidelines of China’s annual parliamentary session.

“China does not wish to fight a trade war, nor will China initiate a trade war, but we can handle any challenge and will resolutely defend the interests of our country and our people,” Zhong said.

President Donald Trump signed proclamations Thursday imposing a 25 percent tariff on imported steel and a 10 percent tariff on imported aluminum, with the new taxes set to go into effect this month.

​US, Japan, EU talk

Trade representatives for Japan and the European Union met with the U.S. trade representative Saturday in an effort to avoid a trade war over Trump’s new tariffs on aluminum and steel.

At the meeting in Brussels, U.S. Trade Representative Robert Lighthizer, EU Trade Commissioner Cecilia Malmstrom and Japanese counterpart Hiroshige Seko discussed the tariffs as part of a trilateral effort to combat unfair trade practices.

The EU said in a statement that both Brussels and Tokyo had serious concerns about the U.S. tariffs. Both powers, two of the biggest trade partners with the United States, have asked for exemptions from the tariffs.

After the meeting, Malmstrom tweeted, “No immediate clarity on the exact U.S. procedure for exemption … so discussions will continue next week.”

“I firmly and clearly expressed my view that this is regrettable,” Seko said at a news conference following the meeting. “… I explained that this could have a bad effect on the entire multilateral trading system.”

Saturday afternoon, Trump accused the EU of treating “the U.S. very badly on trade.” He said if they drop their “horrific barriers & tariffs on U.S. products… we will likewise drop ours,” he wrote in a tweet.

If they don’t, he warned the U.S. would tax European cars and other products.

​Exemptions unclear

On Friday, the European Union said it is not clear whether the bloc will be exempt from Trump’s steel and aluminum tariffs.

EU Trade Commissioner Malmstrom said Friday in Brussels, “We hope that we can get confirmation that the EU is excluded from this.”

Canada and Mexico were given specific exemptions from the tariffs for an indefinite period while negotiations continue on the North American Free Trade Agreement (NAFTA).

Brazil, South Korea and Australia have also asked for exemptions or special treatment.

Trump imposed the tariffs despite pleas from friends and allies who warned the new measure could ignite a trade war.
…

Trade representatives for Japan and the European Union met with the U.S. trade representative Saturday in an effort to avoid a trade war over President Donald Trump’s new tariffs on aluminum and steel.

At the meeting in Brussels, U.S. Trade Representative Robert Lighthizer, EU Trade Commissioner Cecilia Malmstrom and Japanese counterpart Hiroshige Seko discussed the tariffs as part of a trilateral effort to combat unfair trade practices.

The EU said in a statement that both Brussels and Tokyo had serious concerns about the U.S. tariffs. Both powers, two of the biggest trade partners with the United States, have asked for exemptions from the tariffs.

After the meeting, Malmstrom tweeted, “No immediate clarity on the exact U.S. procedure for exemption … so discussions will continue next week.”

Seko said at a news conference following the meeting, “I firmly and clearly expressed my view that this is regrettable. … I explained that this could have a bad effect on the entire multilateral trading system.” 

Saturday afternoon, Trump accused the EU of treating “the U.S. very badly on trade.” He said if they dropped their “horrific barriers & tariffs on U.S. products … we will likewise drop ours.”

If they don’t, he warned, the United States will tax European cars and other products.

On Friday, the European Union said it was not clear whether the bloc would be exempt from Trump’s steel and aluminum tariffs.

Malmstrom said Friday in Brussels, “We hope that we can get confirmation that the EU is excluded from this.”

Trump signed proclamations Thursday imposing a 25 percent tariff on imported steel and a 10 percent tariff on imported aluminum, with the new taxes set to go into effect in two weeks. 

Canada and Mexico were given specific exemptions from the tariffs for an indefinite period while negotiations continue on the North American Free Trade Agreement.

Brazil, South Korea and Australia have also asked for exemptions or special treatment.

Trump imposed the tariffs despite pleas from friends and allies who warned the new measure could ignite a trade war.
…

Several Asian nations that are major trading partners with the U.S. reacted strongly Friday to a U.S. decision to impose tariffs on metal imports, raising concerns of global trade conflicts.

China, a key target of U.S. trade concerns, said it was “resolutely opposed” to the U.S. tariff decision, with Japan warning of the impact on bilateral ties.

South Korea said it may file a complaint to the international trade dispute body, the World Trade Organization (WTO). South Korea is the third-largest steel exporter to the U.S. after Canada and Brazil.

Several Southeast Asian nations say they fear a wave of import dumping of steel and aluminum products.

U.S. President Donald Trump, turning aside warnings from economists and members within the Republican Party, signed an order Thursday for new tariffs of 25 percent on steel and 10 percent on aluminum imports to the U.S., saying the measures were necessary to protect U.S. industry.

Trump has exempted key exporters of steel and aluminum, Canada and Mexico, while negotiating changes to the North American Free Trade Agreement (NAFTA), and other countries such as Australia also may be spared.

The U.S. is the world’s largest importer of steel, totaling 35 million tons of raw material in 2017, with South Korea, Japan, China and India accounting for 6.6 million tons.

Global reaction

Thai economist Wisarn Pupphavesa, a senior adviser to the Thai economic think tank, the Thailand Development Research Institute (TDRI), called the tariff aiming to protect U.S. industry a “very bad situation.”

“The U.S. has been a leader in the multilateral system, the leader in the trade liberalization, and the U.S. played a most important role in writing all the rules that are governing the global market now. But now President Trump decided to break those rules … so this is a very bad situation,” Wisarn told VOA.

Economists at London-based Capital Economics said in a release Friday the major concern over U.S. steps to increase tariffs is they mark a “turning point in U.S. policy to a much broader and deeper shift toward protectionism.”

Malaysia’s Second International Trade and Industry Minister, Datuk Seri Ong Ka Chuan, says the government is monitoring the impact of the tariff increase, although steel and aluminum contributed to less than one percent of Malaysia’s total exports.

But Thailand’s Federation of Thai Industries (FTI) said the threat lies in import dumping of steel and aluminum to the Southeast Asian market.

FTI secretary general, Korrakod Padungjit, told local media there were several leading exporters — Taiwan, Japan, South Korea, India, China, Vietnam and Turkey — that may now target Southeast Asia.

The vice president of the ASEAN [Association of South East Asian Nations] Iron and Steel Council, Roberto Cola, told media that excess steel supplies from China would head to Southeast Asia.

High demand

Southeast Asia’s fast-growing economies, such as the Philippines and Vietnam, face a high demand for steel to meet growing infrastructure and development needs.

Japan at 11 percent and China at 14 percent are reported to be the largest Asian exporters of aluminum to the U.S. A shift in exports to Asia would put producers in South Korea, Indonesia, Vietnam and Thailand under competitive pressure.

Thanomsri Fongarunrung, an economist at the Bangkok-based Phatra Securities, said Thailand already was facing steel import “dumping” by China. She said another fear lies in indirect impacts from any escalation into “tit-for-tat” trade protection measures from other regions, such as the European Union (EU).

The EU already has said it will seek to impose tariffs on selected U.S. imports ranging from alcohol to motorbikes.

But the TDRI’s Wisarn says the economic growth in Southeast Asia in the past decade, with its focus on China, will shield the region from major moves by the U.S. to boost trade protectionism.

“East Asia [has] become the new growth core of the global economy. So the impact of the U.S. action, in fact, would have very little impact as far as East Asia is concerned,” he told VOA.

As a result, the role of the economies of China, Japan and South Korea, as well as Australia and New Zealand, will be enhanced by the U.S. decision.

Trade war

But analysts say the greater concern for regional trade and potential conflict lies ahead with a battle over intellectual property theft, especially targeting China.

Economists say the region’s economic growth potential could be hit by a trade war. The World Bank in a January assessment said growth in East Asia and Pacific is forecast at 6.2 percent in 2018, down slightly from 6.4 percent in 2017.

The World Bank, while upbeat, says “rising geopolitical tension, increased global protectionism” a tightening of global financial conditions, or a “steeper-than-expected” slowdown in major economies, including China, pose a downside risk to the regional outlook.
…