Month: March 2019

For the first time in recent years, Chinese Premier Li Keqiang’s annual Government Work Report did not mention Made in China 2025, the country’s ambitious plan to achieve high-tech dominance, and that has analysts asking whether Beijing is going to completely overhaul the plan or keep it going quietly behind the scenes. Made in China 2025 relies heavily on government subsidies to Chinese companies and their ability to acquire new technologies covering 10 different sectors such as electric cars, emerging bio-medicine, next-generation information technology, advanced robotics and artificial intelligence. The plan is part of China’s broader industrial policy outlined in the 13th Five-Year plan, which lays out government goals from 2016-2020. It raised concerns, however, because of China’s use of forced technology transfers and specific targets to capture market share…

Australia and Singapore have suspended the Boeing 737 Max 8 passenger jet from operating in their respective airspaces, joining a growing list of countries taking precautionary measures involving the troubled plane after its second fatal crash in five months.   Airlines in countries across the globe, including China, Indonesia, Brazil and Mexico, have grounded all the 737 Max 8 jets in their respective fleets after 157 passengers and crew were killed when a 737 Max 8 operated by Ethiopian Airlines crashed Sunday shortly after taking off from Addis Ababa. Statements from both Australia’s and Singapore’s civil aviation authorities say the suspensions are temporary while the investigation into Sunday’s tragedy continues. The suspensions affect Fiji Airlines and Singapore’s SilkAir, which was already suspended from operating by the city-state.   The Ethiopian…

North Korean leader Kim Jong Un may not be able to achieve his economic development goals given the divergent ideas over denuclearization exhibited by Washington and Pyongyang after the Hanoi summit, said experts. After the Hanoi summit broke down last month over discussions of Washington’s demand on denuclearization and Pyongyang’s demand on sanctions relief, Kim made a first public statement emphasizing economic development, a goal he set for this year during his New Year’s Day speech. If the sanctions are not lifted, North Korea and its citizens will likely to face tougher economic conditions this year. North Korea’s main state media outlet, Korea Central News Agency (KCNA), reported on Saturday that Kim stressed last week “the need to concentrate all efforts of information and motivation on accelerating socialist economic construction.”…

The United States should announce a Marshall Plan for South Asia if it wants to compete with China in projecting its "economic soft power" in the region, according to Pakistan's young political leader, Bilawal Bhutto-Zardari. "I think (the) United States and other powers that are now considering cutting and running from Afghanistan, instead of jealously trying to undermine CPEC or the One Belt One Road should come and compete in good old-fashioned capitalism," Bhutto-Zardari, the son of slain former Prime Minister Benazir Bhutto, said in an exclusive interview with VOA's Urdu service. The Marshall Plan was a recovery plan that helped rebuild war-ravaged Europe. Bhutto-Zardari now leads his mother's Pakistan People's Party, which now is one of the most important opposition parties in the country. CPEC - the China-Pakistan Economic…

The Turkish economy has fallen into recession for the first time in a decade, according to data released on Monday. The timing could not be worse for President Recep Tayyip Erdogan with critical local elections scheduled for the end of the month. According to state figures, the gross domestic product shrank by 2.4 percent in the last quarter, a sharper contraction than most predictions. The previous quarter saw a 1.6 percent decline, heralding two successive quarters of falling growth — the definition of a recession. The Turkish economy is still reeling from the aftermath of last year's currency collapse, triggered by U.S. President Donald Trump hitting Ankara with sanctions over the detention in Turkey of American pastor Andrew Brunson, who has since been released. While the sanctions lasted only a…

The U.S. on Monday sanctioned a Moscow-based bank jointly owned by Russian and Venezuelan state-owned companies for its support for Venezuela's embattled President Nicolas Maduro and the country's state-controlled oil industry. The U.S. Treasury said it was targeting Evrofinance Mosnarbank, which was founded in 2011 to help provide financing for joint Russia-Venezuela oil and infrastructure projects, for allegedly trying to circumvent U.S. sanctions on Venezuela. "This action demonstrates that the United States will take action against foreign financial institutions that sustain the illegitimate Maduro regime and contribute to the economic collapse and humanitarian crisis plaguing the people of Venezuela," Treasury Secretary Steven Mnuchin said in a statement. The U.S. and more than 50 other governments recognize opposition leader Juan Guaido as the interim president in Venezuela. They contend that Maduro,…

White House economic adviser Larry Kudlow says that President Donald Trump will call for a 5 percent "across the board" cut in domestic government spending in 2020 when he proposes his new budget on Monday. "It will be a tough budget," Kudlow told the Fox News Sunday show. "We're going to do our own caps this year and I think it's long overdue." Kudlow said that "some of these recent budget deals have not been favorable towards spending. So, I think it's exactly the right prescription." Trump's third budget proposal during his presidency, for the year starting in October, is expected to draw wide opposition from Democratic lawmakers and some Republicans, setting off months of debate just weeks after a record 35-day government shutdown over government spending in the current…

After months of Brexit deadlock, this is it: decision time. At least for now.   With Britain scheduled to leave the European Union in less than three weeks, U.K. lawmakers are poised to choose the country's immediate direction from among three starkly different choices: deal, no deal or delay. A look at what might happen:   Deal deja vu   The House of Commons has a second vote scheduled Tuesday on a deal laying out the terms of Britain's orderly departure from the EU. Prime Minister Theresa May and EU officials agreed to the agreement in December, but U.K. lawmakers voted 432-202 in January to reject it. To get it approved by March 29, the day set for Brexit, May needs to persuade 116 of them to change their minds —…

Federal Reserve Chairman Jerome Powell said Friday that the healthy U.S. economy and low inflation are allowing the central bank to take a “patient, wait-and-see approach” on interest rates. Speaking at Stanford University, Powell said the Fed is well along in its effort to normalize Fed operations by scaling back the extraordinary efforts it employed to support the economy’s recovery from the Great Recession. The Fed is trimming its sizable holdings of Treasury bonds and mortgage-backed securities. Officials are discussing a plan for wrapping up the efforts to reduce the central bank’s balance sheet later this year, Powell said, adding that the plan’s details should be announced soon. The Fed’s moves to reduce its balance sheet, which hit a peak of $4.5 trillion, are being watched closely by investors. Slimming…

Hiring tumbled in February, with U.S. employers adding just 20,000 jobs, the smallest monthly gain in nearly a year and a half. The slowdown in hiring, though, might have been depressed by harsh winter weather and the partial shutdown of the government. Last month's weak gain came after employers had added a blockbuster 311,000 jobs in January, the most in nearly a year. Over the past three months, job growth has averaged a solid 186,000, enough to lower the unemployment rate over time.   And despite the tepid pace of hiring in February, the government's monthly jobs report Friday included some positive signs: Average hourly pay last month rose 3.4 percent from a year earlier _ the sharpest year-over-year increase in a decade. The unemployment rate also fell to 3.8…

U.S. President Donald Trump says he will not sign a trade deal with China unless it is a "very good deal." Trump made the comments Friday as he left the White House to tour tornado damage in the southern U.S. state of Alabama. The United States and China have been battling over trade tariffs since last year. The White House is planning a summit between Trump and Chinese leader Xi Jinping in Florida later this year. "If this isn't a great deal, I won't make a deal," Trump said. Then he added: "We will do very well either way, with or without a deal." The trade dispute between the United States and China has begun to affect China's economic growth. China's exports and imports fell significantly more than expected in…

Wall Street has rewarded its most patient investors handsomely over the past 10 years. Is there more to come? The S&P 500, the U.S. market's benchmark index, has gained about 309 percent since bottoming out at 676.53 points in March 2009 during the Great Recession, according to FactSet. The index is now 5.4 percent below its recent peak of 2,930.75 set on Sept. 20.    This bull market's lifespan, the longest on record, speaks to financial markets' resiliency in the face of a variety of shocks, including a brutal fourth quarter of 2018. Whether the bull keeps running hinges on whether companies can continue raking in profits, a key driver of the stock market, and whether the U.S. economy can avoid sliding into a recession. Bull markets tend to wither…

The International Monetary Fund on Thursday called Venezuela one of the most "complex situations" it had ever seen.    IMF spokesman Gerry Rice described Venezuela and its economy as a combination of "food and nutrition crises, hyperinflation, a destabilized exchange rate, debilitating human capital and physical productive capacity, and a very complicated debt situation."    Rice said tackling this challenge would take "strong resolve" and "broad international support" from all 189 IMF members.    IMF Managing Director Christine Lagarde told The Economist Radio, a podcast, that the fund would help "as soon as we are asked by the legitimate authorities of that country."    "We will open our wallet, we will put our brain to it, and we will make sure our heart is in the right place to help…

Chinese tech giant Huawei has sued the U.S. government, arguing that legislation Congress passed last year restricting its business in the United States is "unconstitutional."  The case, which analysts see more as a public relations move, is the latest in an intensifying effort by the telecommunications company to fight U.S. security concerns that Huawei argues are unfair and unfounded. In its lawsuit, Huawei argues that Section 889 of the National Defense Authorization Act violates the constitutional principles of separation of powers and due process. By singling out the company and punishing it without a trial, the company also argues that the law violates the Constitution's the bill of attainder clause. Section 889 bans federal agencies and their contractors from purchasing equipment and services from Huawei as well as another Chinese…