Economy

Man walks past a flower installation set up for the upcoming Belt and Road Forum in front of the Chinese Foreign Ministry in Beijing
A man walks past a flower installation set up for the upcoming Belt and Road Forum in front of the Chinese Foreign Ministry in Beijing, China April 18, 2019. Picture taken April 18, 2019. Jia Tianyong/CNS via REUTERS

April 21, 2019

By John Ruwitch

SHANGHAI (Reuters) – World leaders meeting in Beijing this week for a summit on China’s Belt and Road initiative will agree to project financing that respects global debt goals and promotes green growth, according to a draft communique seen by Reuters.

The Belt and Road Initiative is a key policy of President Xi Jinping and envisions rebuilding the old Silk Road to connect China with Asia, Europe and beyond with massive infrastructure spending.

But it has proved controversial in many Western capitals, particularly Washington, which views it as merely a means to spread Chinese influence abroad and saddle countries with unsustainable debt through nontransparent projects.

The United States has been particularly critical of Italy’s decision to sign up to the plan last month, the first for a G7 nation.

In an apparent nod to these concerns, the communique reiterates promises reached at the last summit in 2017 for sustainable financing – but adds a line on debt, which was not included the last time.

“We support collaboration among national and international financial institutions to provide diversified and sustainable financial supports for projects,” the draft communique reads.

“We encourage local currency financing, mutual establishment of financial institutions, and a greater role of development finance in line with respective national priorities, laws, regulations and international commitments, and the agreed principles by the UNGA on debt sustainability,” it added, referring to the United Nations General Assembly.

The word “green” appears in the draft seven times. It was not mentioned once in the summit communique from two years ago.

“We underline the importance of promoting green development,” the draft reads. “We encourage the development of green finance including the issuance of green bonds as well as development of green technology.”

The Chinese government’s top diplomat, Wang Yi, said on Friday that the Belt and Road project is not a “geopolitical tool” or a debt crisis for participating nations, but Beijing welcomes constructive suggestions on how to address concerns over the initiative.

A total of 37 foreign leaders are due to attend the April 25-27 summit, though the United States is only sending lower-level representatives, reflecting its unease over the scheme.

The number of foreign leaders at the April 25-27 summit is up from 29 last time, mainly from China’s closest allies like Pakistan and Russia but also Italy, Switzerland and Austria.

China has repeatedly said Belt and Road is for the benefit of the whole world, and that it is committed to upholding globally accepted norms in ensuring projects are transparent and win-win for all parties.

“We emphasize the importance of the rule of law and equal opportunities for all,” the draft reads.

(Reporting by John Ruwitch; Writing by Ben Blanchard; Editing by Edwina Gibbs)

Source: OANN

Customers walk past Avianca airline check-in machines at Congonhas airport in Sao Paulo
FILE PHOTO – Customers walk past Avianca airline check-in machines at Congonhas airport in Sao Paulo, Brazil, April 12, 2019. REUTERS/Nacho Doce

April 20, 2019

BRASILIA (Reuters) – Avianca Brasil has canceled more than 1,300 flights, Brazilian media reported on Saturday, as the bankrupt airline was forced to reduce its fleet by more than two-thirds.

The cancellations, for April 19-28, are nationwide, with airports in Brasilia, Guarulhos in Sao Paulo, and Galeao in Rio de Janeiro, the hardest hit, O Estado de Sao Paulo reported.

Avianca, which filed for bankruptcy protection in December, has to return 18 leased planes after Easter, Brazil’s National Civil Aviation Agency said on Thursday, reducing its fleet to just eight aircraft.

Earlier this month, the airline had 35 planes.

(Reporting by Jamie McGeever; Editing by Richard Chang)

Source: OANN

Illustration photo of a Thomas Cook logo
The Thomas Cook logo is seen in this illustration photo January 22, 2018. REUTERS/Thomas White/Illustration

April 20, 2019

(Reuters) – Thomas Cook has been tentatively approached about a takeover of its tour operating unit, or the entire company, by several parties as its lenders prepare for crunch talks over the state of its finances, Sky News reported on Saturday.

The company, which has put its airline business up for sale, last month announced a review of its money division to help focus on its core holiday business after a rough 2018.

Citing unnamed sources, Sky News reported https://news.sky.com/story/bidders-try-to-land-thomas-cook-as-lenders-chart-new-course-11698817U.S. private equity firm KKR & Co and Swedish buyout group EQT Partners were potential bidders for the group, while China’s Fosun International was understood to be among those to have lodged a preliminary interest in the tour business.

Thomas Cook, the world’s oldest tour operator, has brought in advisers from AlixPartners to work on its balance sheet and cost-reduction plans, while its syndicate of more than a dozen lenders has hired FTI Consulting to advise on their financial exposure to the company, the report added.

Thomas Cook and KKR said they won’t be commenting on the report. EQT declined to comment, while Fosun could not be immediately reached for comment.

(Reporting by Sathvik N in Bengaluru; Editing by David Holmes)

Source: OANN

Larry Fink, Chief Executive Officer of BlackRock, stands at the Bloomberg Global Business forum in New York
Larry Fink, Chief Executive Officer of BlackRock, stands at the Bloomberg Global Business forum in New York, U.S., September 26, 2018. REUTERS/Shannon Stapleton

April 20, 2019

BERLIN (Reuters) – There are no signs that the global economy is sliding toward a recession in the next 12 months, BlackRock Inc’s Chief Executive Larry Fink said in remarks published on Saturday.

In an interview with German business daily Handelsblatt, Fink warned, however, that the global economy was in the late stage of a long growth cycle, suggesting that downturn was becoming more likely.

“I see no signs of a global recession in the coming 12 months,” said Fink, who leads the world’s largest asset manager.

“The central banks have loosened their policy above all because of the weak fourth quarter of 2018. We will go through a phase in which things are not great but also not bad.”

He added: “But we are naturally in a late phase of the economic growth cycle.”

The International Monetary Fund cut its global economic growth forecasts for 2019 this month and said growth could slow further due to unresolved trade disputes and the risk of Britain leaving the European Union without a deal.

The global lender said some major economies, including China and Germany, might need to take short-term actions to prop up growth and that a severe downturn could require coordinated stimulus measures.

German Finance Minister Olaf Scholz has ruled out taking on new debt to stimulate growth in Europe’s biggest economy, saying tax cuts, higher investments and a solid labor market will continue to provide growth impetus.

(Reporting by Joseph Nasr; Editing by Alison Williams)

Source: OANN

Ajay Singh, Chairman of Indian low-cost carrier SpiceJet, speaks with the media before the landing of an amphibious seaplane from Japan's Setouchi Holdings in the Arabian Sea as part of a demonstration by SpiceJet in Mumbai
FILE PHOTO: Ajay Singh, Chairman of Indian low-cost carrier SpiceJet, speaks with the media in Mumbai, India, December 9, 2017. REUTERS/Shailesh Andrade

April 19, 2019

(Reuters) – India’s SpiceJet Ltd said on Friday it will prioritize hiring employees of Jet Airways Ltd who are losing their jobs after the crisis-hit Indian airline halted all flight operations indefinitely this week.

“We have already provided jobs to more than 100 pilots, more than 200 cabin crew and more than 200 technical and airport staff,” said Ajay Singh, chairman and managing director of SpiceJet. “We will do more.”

Hundreds of Jet Airways employees protested in Delhi and Mumbai on Thursday to push its management for answers about their future after the airline shut down all flight operations on Wednesday having failed to secure new funding from its lenders.

Jet Airways has lost many employees as the crisis unfolded. About 400 pilots have moved to other airlines, leaving Jet with about 1,300 pilots, a senior Jet pilot told Reuters. About 40 engineers have also left, a senior engineer said.

Lenders, led by State Bank Of India, say they are hopeful of a successful bidding process for Jet. The carrier is saddled with about $1.2 billion in debt.

Low cost carrier SpiceJet, which pledged to add 27 planes over the next two weeks to help to fill in the slots left vacant by Jet’s grounding, said that it is making all possible efforts to minimize passenger inconvenience. The government plans to form a committee to temporarily allocate takeoff and landing slots left vacant by the grounding of Jet’s flights, a senior official said on Thursday. Local airlines including InterGlobe Aviation Ltd and state-run Air India are likely to benefit.

Air India on Thursday offered special fares to passengers stranded in international routes due to Jet’s grounding.

(Reporting By Arnab Paul in Bengaluru and Tanvi Mehta in Mumbai; Editing by Martin Howell)

Source: OANN

Logo of PrivatBank, the Ukraine's biggest lender, is seen on a bank's branch in Kiev
FILE PHOTO: Logo of PrivatBank, the Ukraine’s biggest lender, is seen on a bank’s branch in Kiev, Ukraine April 18, 2019. REUTERS/Vasily Fedosenko

April 19, 2019

KIEV (Reuters) – A Ukrainian court ruling that the nationalization of the country’s largest bank, PrivatBank, was illegal also said that parties related to the bank’s former owners should be excluded from the legal case, the central bank said on Friday.

The bank said that decision, if implemented, would allow parties related to the former owners to claim money from PrivatBank.

The central bank said it would appeal the decision.

The former owners of PrivatBank are fighting a series of legal battles against the Ukrainian authorities over the 2016 nationalization of the country’s largest lender.

(Reporting by Natalia Zinets; writing by Matthias Williams; Editing by Andrew Osborn)

Source: OANN

FILE PHOTO: U.S. House Speaker Pelosi visits Ireland
FILE PHOTO: U.S. House Speaker Nancy Pelosi speaks next to Ways and Means Commitee Chairman, Rep. Richard Neal (D-MA) as Mayor of Derry City John Boyle looks on near an anti-Brexit protest banner during her visit to the border between Ireland and Northern Ireland in Bridgend, Ireland April 18, 2019. REUTERS/Clodagh Kilcoyne

April 19, 2019

DUBLIN (Reuters) – An influential U.S. congressman has warned the European Union that any Brexit arrangement that undermines Northern Ireland’s 1998 peace agreement could endanger a proposed EU-U.S. trade deal, the Irish Times reported on Friday.

The European Union last week said it was ready to start talks on a trade agreement with the United States and aims to conclude a deal before year-end.

“If America wants a trade agreement with the European Union, which I think is very desirable – I want it – at the same time you are back to the same issue on the border if you do anything that dampens or softens the Good Friday Agreement,” Democratic Congressman Richard Neal was quoted as saying.

Neal is visiting Ireland with U.S. House of Representatives Speaker Nancy Pelosi, who on Wednesday said the United States would also not agree to any trade deal with Britain if future Brexit arrangements undermine peace in Ireland, reiterating comments made by the congressman in February.

The European Union has insisted it will not accept any British withdrawal agreement that results in any infrastructure on the border between Northern Ireland and Ireland, something that would anger Irish nationalists and could become a target for militants.

But some British politicians have called on Brussels to soften this demand to get a deal done.

Neal, chairman of the Congressional committee overseeing trade, said any Brexit deal must maintain the sanctity of the peace agreement, the Irish Times reported.

How to keep EU-member Ireland’s 500km (350 mile) border with Northern Ireland open after Brexit is proving the most intractable issue in Britain’s tortuous efforts to leave the EU.

British Prime Minister Theresa May’s government is in talks with the opposition Labour Party to build support for a Brexit divorce deal that parliament has already rejected three times, potentially delaying the UK’s departure date from the European Union until the end of October.

Much of the opposition to May’s deal within her own party is centered on fears that it would not provide a clean enough break to allow the United Kingdom to forge new trade deals around the world, especially with the United States.

(Reporting by Conor Humphries; Editing by Kirsten Donovan)

Source: OANN

FILE PHOTO: A worker cycles near a factory at the Keihin industrial zone in Kawasaki
FILE PHOTO: A worker cycles near a factory at the Keihin industrial zone in Kawasaki, Japan February 28, 2017. REUTERS/Issei Kato

April 19, 2019

TOKYO (Reuters) – Japan’s March factory output is forecast to have slipped for the first time in two months, a Reuters poll showed on Friday, though the central bank is expected to stand pat on policy as it bets on a gradual economic recovery despite rising risks to growth.

The poll of 17 economists predicted the Bank of Japan will retain its massive stimulus as well as the short-term interest rate target at minus 0.1 percent, while also maintaining its pledge to guide 10-year government bond yields around zero percent at its April 24-25 meeting.

The BOJ is facing a daunting task in its years-long efforts to help push up inflation toward its 2 percent goal, with a slowdown in global growth and trade making its task even more difficult.

Factories have been under strain in the past few months, and the poll forecast industrial production to have slipped 0.1 percent in March from the previous month after it rose 0.7 percent in February.

“Exports are weakening due to the global economic slowdown, which appears to have impacted on factory output,” said Yoshiki Shinke, chief economist at Dai-Ichi Life Research Institute.

“The economy is either at a temporarily lull or worsening slightly. But it requires more data to assess whether the economy contracted in the first quarter.”

The trade ministry will publish the factory output at 8:50 a.m. April 26, Japan time (2350 GMT April 25).

Data on the nation’s retail sector, due at the same time with the factory output numbers, is projected to show sales rising 0.8 percent last month from a year earlier, the poll found, accelerating from a 0.4 percent increase in February.

Recent gains in oil prices appear to have supported fuel retailers and demand from inbound tourists likely also boosted the overall retail sales, analysts said.

Yet the positive retail impulse would need to be sustained for some months to help boost inflation and overall consumption.

Indeed, the BOJ is expected to forecast next week that inflation will remain below its 2 percent target through the fiscal year that ends in March 2022, sources say.

The central bank is also seen sticking to its view that Japan’s economy will emerge from a soft patch and resume a moderate expansion in the second half of 2019.

“We forecast the BOJ won’t largely change its economic view, so the central bank will likely keep its current pace of stimulus policy,” said Shuji Tonouchi, senior market economist at Mitsubishi UFJ Morgan Stanley Securities.

The poll also found Tokyo’s core consumer prices (CPI) index, which includes oil products but excludes fresh food prices, rose 1.1 percent in April from a year earlier, the same pace as in March.

Price gains in oil related products probably contributed to Tokyo’s core CPI, while falls in costs of electricity and city gas weighed on the index, analysts said.

The poll showed the jobless rate pushed up to 2.4 percent in March from 2.3 percent in February, and the jobs-to-applicants ratio improved to 1.64, which would be an over 40-year high, from 1.63 in February.

The government will publish Tokyo’s core CPI and jobs data at 8:30 a.m. on April 26 (2330 GMT on April 25).

(Reporting by Kaori Kaneko; Editing by Shri Navaratnam)

Source: OANN

FILE PHOTO: Shipping containers are seen at Keelung port, northern Taiwan,
FILE PHOTO: Shipping containers are seen at Keelung port, northern Taiwan, March 20, 2016. . REUTERS/Tyrone Siu

April 19, 2019

TAIPEI (Reuters) – Taiwan’s export orders likely declined for a fifth month in March but at a slower pace than in the previous month, a Reuters poll showed, as a prolonged downturn in global tech demand hurts manufacturers in the trade-reliant economy.

The median forecast from the poll of 14 economists was for March export orders to drop 5.45 percent from a year earlier. Forecasts ranged from a decline of 10.3 percent to growth of 3.5 percent.

In February, Taiwan’s export orders fell 10.9 percent, the most in nearly three years due to cautious machinery orders from China as the United States-China trade dispute wears on, pointing to a further slowdown for the island’s economy.

Taiwan export orders are an indicator of demand for Asia’s hi-tech gadgets, and typically lead actual exports by two to three months.

(Poll compiled by Carol Lee; Reporting by Yimou Lee; Editing by Richard Borsuk)

Source: OANN

FILE PHOTO: A man rides an electric scooter past a wind turbine in Shanghai
FILE PHOTO: A man rides an electric scooter past a wind turbine in Shanghai, China August 11, 2017. REUTERS/Aly Song

April 19, 2019

BEIJING (Reuters) – China on Friday said it would promote using energy generated by the wind to help power heating systems during the bitterly cold winters seen in many parts of the country.

That comes as the world’s No.2 economy pushes to reduce carbon emissions from coal-burning as part of its battle against pollution.

The National Energy Administration urged local authorities to set annual targets for generating heating using energy from wind farms over the period form 2019 to 2021. It also said they should build infrastructure to promote the use of wind power.

Local governments will be given less than two months to draw up plans and submit them to Beijing.

Wind power generators that participate in winter heating projects could receive tax reductions or subsidies, the NEA said in the statement.

The NEA also called for grid companies to work on removing technical barriers to reducing power wastage due to insufficient transmission capacity.

(Reporting by Muyu Xu and Dominique Patton; Editing by Joseph Radford)

Source: OANN


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