Category: Business

Canadian Foreign Affairs Minister Chrystia Freeland postponed her U.N. speech Saturday as free-trade talks between the U.S. and Canada intensified. Freeland had been scheduled to deliver Canada's address to the General Assembly in New York, but Canada exchanged the slot with another country. Freeland may or may not give the speech on Monday. A senior Canadian government official said they were making progress in the talks but that it wasn't certain that they would reach a deal soon. The official, who spoke on condition of anonymity, said Canada would sign only a good deal. Canada, the United States' No. 2 trading partner, was left out when the U.S. and Mexico reached an agreement last month to revamp the North American Free Trade Agreement. The U.S. and Canada are under pressure to…

U.S. consumer spending increased steadily in August, supporting expectations of solid economic growth in the third quarter, while a measure of underlying inflation remained at the Federal Reserve's 2 percent target for a fourth straight month. Economists said Friday's report from the Commerce Department should allay fears of the economy overheating and likely keeps the U.S. central bank on a gradual path of interest rate increases. The Fed raised rates Wednesday for the third time this year and removed the reference to monetary policy remaining "accommodative." "Growth is solid and inflation pressures modest," said Chris Rupkey, chief economist at MUFG in New York. "This is exactly the environment the Fed needs to move interest rates up at a gradual pace as further rate hikes start to look like tightening." Consumer…

Tesla without Elon Musk at the wheel? To many of the electric car maker's customers and investors, that would be unthinkable. But that's what government securities regulators now want to see. The Securities and Exchange Commission has asked a federal court to oust Musk as Tesla's chairman and chief executive officer, alleging he committed securities fraud with false statements about plans to take the company private. The agency says in a complaint filed Thursday that Musk falsely claimed in an Aug. 7 statement on Twitter that funding had been secured for Tesla Inc. to go private at $420 per share, a substantial premium over the stock price at the time. The SEC is asking the U.S. District Court in Manhattan to bar Musk from serving as an officer or director…

Italy’s stock market fell sharply Friday after the new populist, euroskeptic government announced a sharp public spending increase that will push the budget deficit to 2.4 percent of gross domestic product next year, risking a collision with the European Union. The benchmark FTSE MIB dropped 2.2 percent early Friday, hours after the government announced its first financial targets since taking office three months ago.  Italy’s government partners, the 5-Star movement and the League, pressed for money to fulfill campaign pledges, namely a basic citizen’s income for job seekers and a flat tax. Finance Minister Giovanni Tria, who is politically unaligned, had wanted to keep the budget deficit capped at no more than 2 percent. The leader of the 5-Star Movement, Luigi Di Maio, called the document approved early Friday by…

Puerto Rico Gov. Ricardo Rossello flew to New York this week on a mission: convince potential tourists that the hurricane-ravaged island was ready for their return. But Puerto Rico's recovery from last year's Hurricane Maria has been a "mixed bag," Rossello told Reuters on Thursday, acknowledging that the bankrupt U.S. territory, while improving, was far from out of the woods. Puerto Rico has received only a small fraction of the federal funding it needs to get back on its feet, Rossello said in a 75-minute interview, and getting access to the rest could take more than a decade. $4 billion or less His administration estimates that fixing Puerto Rico fully will require $139 billion, but the federal government has earmarked only about $60 billion to $65 billion for the recovery, he said. Of that, only about $3 billion to $4 billion has actually…

U.S. securities regulators on Thursday accused Tesla Inc. Chief Executive Elon Musk of fraud and sought to ban him as an officer of a public company, saying he made a series of "false and misleading" tweets about potentially taking the electric car company private last month. Musk, 47, is one of the highest-profile tech executives to be accused of fraud by the Securities and Exchange Commission. Losing its public face and guiding force would be a big blow for money-losing Tesla, which has a market value of more than $50 billion, chiefly because of investors' belief in Musk's leadership. Tesla shares tumbled 12 percent in after-hours trading. Company officials were not immediately available for comment. The SEC's lawsuit, filed in Manhattan federal court, came less than two months after Musk told his more than 22 million Twitter followers on Aug.…

The United States and Japan have agreed to begin negotiations on a bilateral free-trade agreement, reducing the prospect that Washington might impose tariffs against another trading partner. “We’ve agreed today to start trade negotiations between the United States and Japan,” U.S. President Donald Trump said at a summit with Japanese Prime Minister Shinzo Abe in New York on the sidelines of the U.N. General Assembly. “This was something that for various reasons over the years Japan was unwilling to do and now they are willing to do. So we’re very happy about that, and I’m sure that we will come to a satisfactory conclusion, and if we don’t, ohhhhhh,” Trump added. Fast-track authority The White House released a statement after the meeting, stating the two countries would enter into talks…

Ford chief Jim Hackett on Wednesday ramped up his warnings about the tariffs imposed by President Donald Trump, saying his company was seeing profits slashed by $1 billion. Hackett said the global automaker could face more damage if the trade confrontations were not resolved quickly. “The metals tariffs took about $1 billion in profit from us,” Hackett said in an interview on Bloomberg Television. “If it goes on longer, there will be more damage.” Trump in June imposed steep tariffs on steel and aluminum and has hit $250 billion in Chinese products with tariffs, prompting retaliation from US trading partners and raising costs for many industries. The company earlier this year estimated materials costs would be $1.5 billion over 2017, which had already seen a jump.  And in the July…

Somalia's finance minister says World Bank grants to the government are a sign the country has "trustable leadership" again after decades of chaos and corruption. The World Bank said Tuesday it will provide $80 million in grants to Somalia's federal government, the bank's first direct grants to a Somali central authority in 27 years. In an interview with VOA's Somali service, Finance Minister Abdirahman Duale Beileh said the grants are "proof of Somalia's merit." Beileh said $60 million will be used to increase the capacity of Somalia's financial institutions, and $20 million will go toward education and energy projects to build the country's resilience. He said the grants show that international financial agencies have faith the government is capable of fighting against corruption. "The work we have done and the…

The Federal Reserve on Wednesday raised a key interest rate for the third time this year in response to a strong U.S. economy and signaled that it expected to maintain a pace of gradual rate hikes. The Fed lifted its short-term rate — a benchmark for many consumer and business loans — by a quarter-point to a range of 2 percent to 2.25 percent. It was the eighth hike since late 2015. The central bank stuck with its previous forecast for a fourth rate increase before year's end and for three more hikes in 2019. The Fed dropped phrasing it had used for years that characterized its rate policy as "accommodative'' by favoring low rates. In dropping that language, the central bank may be signaling its resolve to keep raising…

The U.N. Conference on Trade and Development warns the world economy remains fragile, one decade after the collapse of the U.S. financial titan Lehman Brothers triggered a global economic crisis. In its report Trade and Development Report 2018: Power, Platforms and the Free Trade Delusion, UNCTAD says the world economy once again is under stress. It views trade wars and escalating tariffs as symptoms of a growing economic malaise. It warns the world economy is walking a tightrope between debt-fueled growth and financial instability. Lead author of the report Richard Kozul-Wright says many of the underlying problems that caused the 2008 financial crisis have not been addressed. He says footloose capital, precarious jobs, persistent inequality and rising debt remain problematic. “We see growing asset bubbles and emerging crises everywhere," he…

Trade conflicts, rising debt and the potential impact from rising interest rates in the U.S. will likely dampen growth in the coming year, the Asian Development Bank said Wednesday in an update of its regional economic outlook report.  The Manila, Philippines-based regional lender said Wednesday that it expects economic growth to remain at a robust 6.0 percent in 2018 but to slip to 5.8 percent next year.  It cited looming financial and trade shocks as the biggest sources of potential trouble. If the U.S. economy shows signs of overheating, interest rate hikes by the Federal Reserve could disrupt currency markets and other capital flows, leading to problems with bad loans.  Overly high housing prices also are risks for China, Hong Kong, Malaysia and South Korea, it said.  But it said…

After losing his job with a foreign food company in March, Alexander Costa surveyed Brazil's anemic labor market and decided to start selling cheap lunches by the beach in Rio de Janeiro to try and provide for his young family. "I could have stayed home, looking for work, sending out resumes, with few jobs and things very hard," Costa said. "But I didn't stand still. I decided to create something different ... to reinvent myself." Many other Brazilians have also had to reinvent themselves in recent years, as Latin America's largest economy struggles to overcome a jobs crisis more than a year after officially exiting recession. Nearly 13 million people - or more than the entire population of Greece - are out of a job, with the unemployment rate hovering…

The five remaining parties to the Iran nuclear deal have agreed to establish a special payment system to allow companies to continue doing business with the regime, bypassing new sanctions imposed by the United States. Envoys from Britain, France, Germany, Russia, China and Iran issued a statement late Monday from the United Nations announcing the creation of a "Special Purpose Vehicle" that will be established in the European Union. The parties said the new mechanism was created to facilitate payments related to Iranian exports, including oil.  Federica Mogherini, EU's foreign policy chief, told reporters after the deal was announced that the SPV gives EU member states "a legal entity to facilitate legitimate financial transactions with Iran...and allow European companies to continue to trade with Iran in accordance to European Union…

The “gig” economy might not be the new frontier for America’s workforce after all. From Uber to TaskRabbit to YourMechanic, so-called gig work has been widely seen as ideal for people who want the flexibility and independence that traditional jobs don’t offer. Yet the evidence is growing that over time, they don’t deliver the financial returns many expect. And they don’t appear to be reshaping the workforce. Over the past two years, for example, pay for gig workers has dropped, and they are earning a growing share of their income elsewhere, a new study finds. Most Americans who earn income through online platforms do so for only a few months each year, according to the study by the JPMorgan Chase Institute being released Monday. One reason is that some people…

Malawi continues to struggle to develop its tourism industry, despite having several attractions, including national parks, game reserves and mountains. But the government has developed a Tourism Strategic Plan that seeks to address challenges to attracting more tourists. Lameck Masina reports on Malawi's efforts to develop the industry, after attending a recent tourism street carnival in the country's commercial capital, Blantyre. ...

Secretary of State Mike Pompeo vows the United States will be victorious in any trade war with China, a day before the Trump administration's latest tariffs on Chinese imports go into effect. Pompeo told Fox News on Sunday. "We are going to get an outcome which forces China to behave in a way that if you want to be a power, a global power... you do not steal intellectual property." The Trump administration has argued tariffs on Chinese goods would force China to trade on more favorable terms with the United States. It has demanded that China better protect American intellectual property, including ending the practice of cyber theft. The Trump administration has also called on China to allow U.S. companies greater access to Chinese markets and to cut its…

Comcast beat Rupert Murdoch's Twenty-First Century Fox in the battle for Sky after offering 30.6 billion pounds ($40 billion) for the British broadcaster, in a dramatic auction to decide the fate of the pay-television group. U.S. cable giant Comcast bid 17.28 pounds a share for control of London-listed Sky, bettering a 15.67 offer by Fox, the Takeover Panel said in a  statement shortly after final bids were made Saturday. Comcast's final offer was significantly higher than its bid going into the auction of 14.75 pounds, and compares with Sky's closing share price of 15.85 pounds on Friday. Brian Roberts, chairman and chief executive of Comcast, coveted Sky to expand its international presence as growth slows in its core U.S. market. Owning Sky will make Comcast the world's largest pay-TV operator with around 52 million customers. "This is a great day…

British Prime Minister Theresa May's aides have begun contingency planning for a snap election in November to save both Brexit and her job, the Sunday Times reported. The newspaper said that two senior members of May's Downing Street political team began "war-gaming" an autumn vote to win public backing for a new plan, after her Brexit proposals were criticized at a summit in Salzburg last week. Downing Street was not immediately available to comment on the report. Meanwhile, opposition Labor leader Jeremy Corbyn said Saturday that his party would challenge May on any Brexit deal she could strike with Brussels, and he said there should be a national election if the deal fell short. The British government said Saturday that it would not "capitulate" to European Union demands in Brexit talks and again urged the bloc to engage with its…

Tensions between China and the United States escalated Saturday as China's Foreign Ministry summoned U.S. Ambassador to China Terry Branstad to issue a harsh protest against U.S. sanctions set for the purchase of Russian fighter jets and surface-to-air missiles. The move came hours after China canceled trade talks with the U.S. following Washington's imposition of new tariffs on Chinese goods. The statement on the Chinese Foreign Ministry's website called the imposition of sanctions "a serious violation of the basic principles of international law" and a "hegemonic act." The ministry also wrote, "Sino-Russian military cooperation is the normal cooperation of the two sovereign states, and the U.S. has no right to interfere." The U.S. actions, it said, "have seriously damaged the relations" with China.  China had earlier called on the U.S. to…

America's rediscovered prowess in oil production is shaking up old notions about the impact of higher crude prices on the U.S. economy. It has long been conventional wisdom that rising oil prices hurt the economy by forcing consumers to spend more on gasoline and heating their homes, leaving less for other things. Presumably that kind of run-up would slow the U.S. economy. Instead, the economy grew at its fastest rate in nearly four years during the April-through-June quarter. President Donald Trump appears plainly worried about rising oil prices just a few weeks before mid-term elections that will decide which party controls the House and Senate. "We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for…

China has canceled trade talks with the United States following Washington’s imposition of new tariffs on Chinese goods. The Wall Street Journal reports that China had planned to send Vice Premier Liu He to Washington next week for the talks, but has now canceled his trip along with that of a midlevel delegation that was to precede him. US was optimistic Earlier Friday, a senior White House official said the U.S. was optimistic about finding a way forward in trade talks with China. The official told reporters at the White House that China “must come to the table in a meaningful way” for there to be progress on the trade dispute. The official, speaking on condition of anonymity, said while there was no confirmed meeting between the United States and…

Canada and the United States showed scant sign on Thursday of closing a deal to revamp NAFTA, and Canadian officials made clear Washington needed to withdraw a threat of possible autos tariffs, sources said. The administration of U.S. President Donald Trump wants to be able to agree on a text of the three-nation North American Free Trade Agreement by the end of September, but major differences remain. "We discussed some tough issues today," Canadian Foreign Minister Chrystia Freeland told reporters after meeting with U.S. Trade Representative Robert Lighthizer. Freeland, who has visited Washington four weeks in a row to discuss NAFTA, gave no further details. Market fears over the future of the 1994 pact, which underscores $1.2 trillion in trade, have been regularly hitting stocks in all three nations, whose…

Seven years after the Arab Spring, little has been done to address youth unemployment in Tunisia, a key factor in extremist groups' ability to recruit marginalized youth, rights groups and experts warn. "Someone who is marginalized with nothing to lose, no stability in life, no vision of the future, no hope for change, can become a very easy target for terrorist groups," Amna Guellali, director of Human Rights Watch's Tunisia office, told VOA. The Arab Spring was ignited in Tunisia, in part because of deteriorating economic conditions. A frustrated street vendor set himself on fire outside a local municipal office in Sidi Bouzid to protest repeated harassment from authorities, who often confiscated his goods or fined him for selling without a permit.  Although economic conditions that force people to eke out a…

New U.S. claims for jobless benefits fell for the third week in a row, hitting their lowest level in nearly 49 years for the third straight week, the Labor Department reported Thursday. The new figures suggest the U.S. economy's vigorous job creation continued unabated this month as the data were collected during the survey week for the department's more closely watched monthly jobs report, due out next week. Amid a widely reported labor shortage, employers are reluctant to lay off workers who are difficult to replace. For the week ended September 12, new claims for unemployment insurance fell to 201,000, down 3,000 from the prior week. Economists had instead been expecting a result of 209,000. The result was the lowest level since November of 1969, whereas the prior week's level…

The world is making progress in its efforts to lift people out of extreme poverty, but the global aspiration of eliminating such poverty by 2030 is unattainable, a new report found. A World Bank report released Wednesday says the number of people living on less than $1.90 per day fell to a record low of 736 million, or 10 percent of the world’s population, in 2015, the latest year for which data is available. The figure was less than the 11 percent recorded in 2013, showing slow but steady progress. “Over the last 25 years, more than a billion people have lifted themselves out of extreme poverty, and the global poverty rate is now lower than it has ever been in recorded history. This is one of the greatest human…

Alibaba Chairman Jack Ma said Wednesday that the Chinese e-commerce giant had canceled plans to create 1 million jobs in the U.S., blaming the ongoing trade war for the decision, according to Chinese news agency Xinhua. "This commitment is based on friendly China-U.S. cooperation and the rational and objective premise of bilateral trade," Ma told Xinhua. "The current situation has already destroyed the original premise. There is no way to deliver the promise." Ma originally pledged to spur job growth by letting American small businesses and farmers sell their goods on Alibaba, which is one of the world's largest online retailers, when he visited then-President-elect Donald Trump early 2017. Trump imposed 10 percent tariffs on $200 billion worth of Chinese imports on Monday, threatening to place taxes on an additional…

Chinese technology billionaire Jack Ma has rescinded his offer to create 1 million new jobs in the United States, saying it is no longer possible with the escalation of trade disputes between the world's two biggest economies. The Alibaba chief made the U.S. jobs pledge to then-President-elect Donald Trump in January 2017 at Trump Tower in New York, just before Trump assumed power. The prospective U.S. leader declared, "Jack and I are going to do some great things." But in an interview published late Wednesday by Xinhua, China's official news agency, Ma said tit-for-tat tariffs imposed by Washington and Beijing, including new levies this week on billions of dollars of trade between China and the U.S., have scuttled his investment plans in the U.S.. "This promise was on the basis…