YCLOAK

U.S. and Mexican trade ministers were set to resume talks over the North American Free Trade Agreement in Washington on Tuesday in a final push for a deal on autos that would open the door for Canada to return to negotiations this week.

If Mexican Economy Minister Ildefonso Guajardo and U.S. Trade Representative Robert Lighthizer can resolve remaining bilateral issues, “the plan is to try to incorporate Canada into the discussions,” possibly as early as Thursday, said a Mexican source close to the talks.

Though NAFTA is a trilateral trade deal, “there are issues that are really bilateral issues between Mexico and the United States,” said the source. In rules of origin for autos “Mexico clearly had to look for flexibilities because Canada was relatively comfortable with the original [U.S.] proposal.”

In the meantime, Canada has remained sidelined from the talks.

“We are making progress in the chapters that will modernize our agreement, and Mexico will continue working constructively on all fronts,” Mexico’s chief NAFTA negotiator Kenneth Smith said Tuesday on Twitter.

The United States and Mexico are close to a deal to increase North American automotive content thresholds, with substantial requirements for content produced in high-wage areas, namely the United States and Canada, said the source.

The deal is expected to lift the requirement for North American content in regionally made vehicles to at least 70 percent from the current 62.5 percent. It will also likely require that some 40 percent of the value come from high-wage locations paying at least $16 an hour, meaning the United States and Canada.

Mexican and U.S. negotiators were also close to agreeing on a 5-year phase-in period for implementing the changes in the auto industry, the source said.

Opposition

Still, foreign-brand automakers with U.S. plants oppose the move to raise the amount of local content in North American-made vehicles and could throw a monkey wrench in negotiators’ plans to secure a bilateral deal this week.

The carmakers, including Toyota, Volkswagen AG and Hyundai, sent a letter to top trade-focused members of U.S. Congress expressing their concern.

The letter could spark resistance to a revamped NAFTA from lawmakers in southern states, where foreign manufacturers have built auto plants.

U.S. President Donald Trump, who launched the renegotiation of the 1994 pact a year ago, has said he wants the reworked deal to bring manufacturing jobs back to the United States, particularly in autos and auto parts.

Other key unresolved issues include the dispute settlement mechanism and a U.S. demand for a “sunset” clause that forces a renegotiation every five years, which critics argue would make long-term investment decisions more difficult.

Guajardo last month expressed hope that there could be a preliminary NAFTA deal by the end of August, but he has since appeared to pull back from that position.
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Large real-estate developments in India should be subject to the same scrutiny as industrial projects given their environmental impact, according to city planners and campaigners.

A proposal to redevelop parts of New Delhi that required the felling of thousands of trees recently provoked fierce protests, court petitions and night patrols to guard the trees.

While projects measuring more than 20,000 square meters require impact assessments, exemptions are often made and public hearings are never held, analysts said.

“Large construction projects have a huge environmental and social footprint, and deserve scrutiny for their impact on energy and water use, and urban infrastructure,” said Kanchi Kohli at New Delhi think tank Centre for Policy Research.

“Cities are already dealing with severe air pollution, water shortages and traffic congestion. Residents deserve a say in these projects,” she told Reuters.

Worldwide, cities occupy 2 percent of the land mass, but account for more than 70 percent of carbon dioxide emissions.

India is forecast to overtake China by 2024 as the world’s most populous country, with tens of millions of citizens cramming into already crowded cities.

As developers rush to cash in, unplanned urban sprawl is leading to congestion, flooding and more slums, analysts say.

Authorities have introduced stricter environmental laws for businesses in recent years, but analysts say they are poorly implemented in a rush to lure investors.

But it is not all one way.

Chirayu Bhatt, an urban planner at CEPT University in Ahmedabad, said large developments — be they residential or commercial — can be good for future generations even if today’s city dwellers often pay the price.

“While the costs of a project are borne by current residents, the benefits accrue to future residents — migrants, our children and grandchildren. We must recognize that,” he said.

In New Delhi, the National Green Tribunal — which decides on environmental matters — last week ordered that no trees be felled while the redevelopment case is examined.

Developers say subjecting real estate projects to the same scrutiny as large industrial developments is “not justified.”

“There are already stringent environmental clearances that are required, and measures such as rain water harvesting and sewage treatment plants have been made mandatory,” said Anuj Puri, chairman of Anarock Property Consultants.

But excluding citizens is not right, Kohli said.

“Citizens must be a part of the review process; more so now, because the drawing of ground water, the discharge of effluents, the use of public spaces affects us all.”
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Washington is prepared to impose more economic pain on Russia if it does not change its behavior, Trump administration officials said on Tuesday, as U.S. lawmakers pushed for stronger measures to counteract “malign” Russian activities.

“Though Russia’s malign activities continue, we believe its adventurism undoubtedly has been checked by the knowledge that we can bring much more economic pain to bear using our powerful range of authorities — and that we will not hesitate to do so if its conduct does not demonstrably and significantly change,” Acting Deputy Treasury Secretary Sigal Mandelker told the Senate Banking Committee.

U.S. President Donald Trump has repeatedly said he would like better ties with Moscow, but although he met Russian President Vladimir Putin last month, relations between the two countries have come under further strain.

Members of Congress, where both chambers are controlled by Trump’ fellow Republicans, have called for more action — including threatening sanctions “from hell” — to punish Russia for actions including its annexation of Crimea, involvement in Syria’s civil war and cyberattacks seeking to influence U.S. elections.

Two U.S. Senate committees held simultaneous hearings on Russia on Tuesday, where some lawmakers chastised administration officials for failing to sufficiently answer their questions, and for sending conflicting messages and doing too little to change Russian behavior.

Both Republicans and Democrats in Congress have criticized Trump, particularly after his summit with Putin in Helsinki last month, for failing to stand up to Moscow on issues including what they see as Trump’s failure to hold the Russian president accountable for Moscow’s meddling in the 2016 U.S. election.

Microsoft Corp said late Monday that hackers linked to the Kremlin sought to launch cyberattacks on the Senate and conservative American think tanks, warning of broader attacks ahead of congressional elections in November. 

The Kremlin rejected the Microsoft allegations and said there was no evidence to support them. Moscow has repeatedly denied attempting to influence U.S. elections, including the 2016 presidential vote that brought Trump into office. U.S. intelligence agencies have concluded that Russia interfered in the 2016 campaign, seeking to tilt the vote in Trump’s favor.

Cost to Russia

U.S. administration officials told the Senate hearings that existing sanctions were having an effect on Russia’s economy, despite continuing behavior that concerns Washington.

Separately, the Treasury Department imposed new sanctions on two Russians, one Russian company and one Slovakian firm over actions it said helped another Russian company avoid sanctions over cyber-related activities.

The United States also announced sanctions on Russian shipping over the transfer of refined petroleum products to North Korea in violation of U.N. restrictions.

Assistant Secretary of State Wess Mitchell told the Foreign Relations Committee that concern about sanctions has cost Russia $8 to $10 billion in arms deals. Without the American measures, Moscow’s behavior would be further “off the charts,” Mitchell said.

Mitchell also said foreign direct investment in Russia has fallen by 80 percent since 2013, “which is a pretty stunning number.”

“I think this administration has been clear that we are prepared to take additional steps,” Mitchell said. “There is an escalatory ladder to sanctions. We are aware of what additional steps would be needed to make an even bigger point.”

Marshall Billingslea, assistant Treasury secretary for terrorism financing, told the Foreign Relations panel it was important that European allies, particularly in eastern Europe, do more to combat money laundering.

“There is an enormous amount of money that is still being exfiltrated from Russia by both organized crime and cronies surrounding Putin,” Billingslea said.

In an interview with Reuters on Monday, Trump said he would only consider lifting sanctions against Russia if it were to do something positive for the United States, for instance in Syria or in Ukraine.
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South Africa’s state-owned Land Bank said on Monday a plan to allow the state to seize land without compensation could trigger defaults that could cost the government 41 billion rand ($2.8 billion) if the bank’s rights as a creditor are not protected.

Land Bank is a specialist bank providing financial services to the commercial farming sector and other agricultural businesses.

President Cyril Ramaphosa announced on Aug. 1 that the ruling African National Congress (ANC) is forging ahead with plans to change the constitution to allow the expropriation of land without compensation, as whites still own most of South Africa’s land more than two decades after the end of apartheid.

Land Bank Chairman Arthur Moloto said in the company’s 2018 annual report that the bank has approximately 9 billion rand of debt, which includes a standard market clause on “expropriation” as an event of default.

Moloto said if expropriation without compensation were to materialize without protection of the bank’s rights as a creditor, it would be required to repay 9 billion rand immediately.

“A cross default clause would be triggered should we fail to pay when these debts fall due because of inadequate liquidity or lack of alternative sources of funding,” Moloto said.

“This would make our entire 41 billion rand funding portfolio due and payable immediately, which we would not be able to settle. Consequently, government intervention would be required to settle our lenders.”

Moloto said the bank was generally funded by the local debt and capital markets, and more recently international multilateral institutions such as the African Development Bank and World Bank.

“A poorly executed expropriation without compensation could result in the main sources of funding drying up as investors might not be willing to continue funding Land Bank in particular, or agriculture in general,” he said.

Some investors are concerned that the ANC’s reforms will result in white farmers being stripped of land to the detriment of the economy, as happened in Zimbabwe, although Ramaphosa has repeatedly said any changes will not compromise food security or economic growth.

Since the end of apartheid in 1994, the ANC has followed a “willing-seller, willing-buyer” model under which the government buys white-owned farms for redistribution to blacks. Progress has been slow.

($1 = 14.6363 rand)
…

The bull market in U.S. stocks is about to become the longest in history.

 

If stocks don’t drop significantly by the close of trading Wednesday, the bull market that began in March 2009 will have lasted nine years, five months and 13 days, a record that few would have predicted when the market struggled to find its footing after a 50 percent plunge during the financial crisis.

 

The long rally has added trillions of dollars to household wealth, helping the economy, and stands as a testament to the ability of large U.S. companies to squeeze out profits in tough times and confidence among investors as they shrugged off repeated crises and kept buying.

 

“There was no manic trading, there was no panic buying or selling,” said Jack Ablin, chief investment officer of Cresset Wealth Advisors. “It’s been pretty steady.”

 

The question now is when the rally will end. The Federal Reserve is undoing many of the stimulative measures that supported the market, including keeping interest rates near zero. There are also mounting threats to global trade that have unsettled investors.

 

For such an enduring bull market, it shares little of the hallmarks of prior rallies.

 

Unlike earlier rallies, individual investors have largely sat out after getting burned by two crashes in less than a decade. Trading has been lackluster, with few shares exchanging hands each day. Private companies have shown little enthusiasm, too, with fewer selling stock in initial public offerings than in previous bull runs.

 

Yet this bull market has been remarkably resilient. After several blows that might have killed off a less robust rally — fears of a eurozone collapse, plunging oil prices, a U.S. credit downgrade, President Donald Trump’s trade fights — investors soon returned to buying, avoiding a 20 percent drop in stocks that by common definition marks the end of bull markets.

 

“I don’t think anyone could have predicted the length and strength of this bull market,” said David Lebovitz, a global market strategist at JPMorgan Asset Management.

One of the market’s biggest winners in recent years, Facebook, wasn’t even publicly traded when the bull market began. Facebook’s huge run-up of more than 350 percent since going public in 2012, Apple’s steady march to $1 trillion in value, and huge gains by other tech companies like Netflix have helped push the broader market higher.

 

Since the rally officially began on March 9, 2009, the Standard and Poor’s 500 has risen 321 percent. In the 1990s bull market, the current record holder for the longest, stocks rose 417 percent.

 

From the start, the Federal Reserve was a big force pushing markets higher. It slashed short-term borrowing rates to zero, then began buying trillions of dollars of bonds to push longer-term rates down, too. Investors frustrated with tiny interest payments on bonds felt they had no alternative but to pile into stocks.

 

Companies moved fast to adapt to the post-financial-crisis world of sluggish U.S. growth.

 

They slashed costs and kept wage growth low, squeezing profits out of barely growing sales. They bought back huge amounts of their own stock and expanded their sales overseas, particularly to China’s booming economy. Profit margins reached record levels, as wages sunk to record lows as measured against the size of economy.

 

“What people missed was how quickly U.S. corporations were restructuring and right-sizing themselves to regain profitability,” said money manager James Abate, who publicly urged investors to start buying stocks in early 2009 when most were dumping them. “It was really a catalyst for turning things around.”

 

China’s surging growth helped the market, too. Its boom drove up the price of oil and other commodities, helping to lift stocks of U.S. natural resource companies — for a while at least.

 

Then came a downgrade of the U.S. credit rating in August 2011, which caused stocks to swoon, and 2013 brought another fall as Fed Chairman Ben Bernanke talked of easing off stimulus policies. In the second half 2014, oil plunged 50 percent, which rattled investors again.

 

Profits started falling the next year, but investors kept their nerve and didn’t sell and waited for profits to rise again. In 2016, stocks gained 10 percent then jumped 19 percent the next year. Since the start of 2018, they have risen 6.6 percent, boosted by surging profits following the massive cut in corporate tax rates earlier this year.

 

Several dangers threaten the rally.

 

The Fed has hiked its benchmark lending rate twice since January, and is expected raise it twice more by the end of the year.

 

Stocks could suffer as higher interest on bonds convinces investors to start shifting money into this safer alternative. Higher rates also increase costs for business and make expanding operations more difficult.

More worrisome, rising rates can trigger recessions, which often kill bull markets. Three of the past five recessions were preceded by rate hikes by the Federal Reserve.

 

With stocks richly priced, there isn’t much room for things to go wrong.

 

The prices investors are paying per share for companies are 2.2 times revenue per share, near historic peaks. And prices compared to long-term earnings are much higher than in 2007 before the market crashed.

 

For all its longevity and gains, the final verdict on the bull market won’t be known until it ends.

 

The financial crisis of 2008 that ended the last bull market laid bare just how much debt and risk-taking had fueled gains in the previous seven years. The dot-com bust that ended the 90s rally showed how reckless investors had been.

 

This time, many of the unanswered questions concern the Fed’s monetary stimulus.

 

How much did it help boost stocks, and thus the broader economy? Will the gains it helped manufacture prove ephemeral? What are the long-term costs of its unprecedented economic rescue effort as it faces the tricky task of unwinding its stimulus program?

 

Another question is the wisdom of so many buybacks. Companies have spent trillions in recent years repurchasing their own stock, which has helped lift prices in the short term but does nothing to expand operations, train workers and generally improve their business. Many of the purchases were made with borrowed money, adding to already sizable debts.

 

Abate, the money manager who urged people to buy early in 2009, says stock prices are too high given the threat to profits from higher borrowing costs as rates climb, higher input costs from Trump’s tariffs and, possibly, bigger raises for workers in the future.

 

“Profits are peaking and valuations are extreme,” said Abate, chief investment officer of Centre Asset Management.

 

His prediction is that stocks will plunge by the end of the year and a bear market will begin.

 

Others are more optimistic.

 

JPMorgan’s Lebovitz takes comfort in the fact investors have been skeptical of the rally all along, which he says has allowed none of the excesses of prior bull markets to build up.

 

“This is a bull market that people love to hate,” he said. “Blind exuberance hasn’t been a characteristic.”

 

Asked how much longer the rally will last, he said: “At least another year, but two might be a bit of stretch.”
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The space company of billionaire Microsoft co-founder Paul Allen on Monday unveiled details of medium-lift rockets and a reusable space cargo plane it is developing, injecting more competition into the lucrative launch services market.

With its rockets, Allen’s Stratolaunch Systems is trying to cash in on higher demand in the coming years for vessels that can put satellites into orbit. But his vehicles will have to compete domestically with other space entrepreneurs and industry stalwarts such as Elon Musk’s SpaceX and United Launch Alliance — a partnership between Boeing and Lockheed Martin.

Seattle-based Stratolaunch, founded by Allen in 2011, said in a news release its launch vehicles will make satellite deployment “as easy as booking an airline flight,” though the first rocket launch is not slated until 2020 at the earliest and the massive airplane it is building to deploy the rockets is  still in pre-flight testing.

Rather than blasting off from a launch pad, Stratolaunch’s rockets will drop at high altitude from underneath the company’s six-engine, twin-fuselage airplane — the largest ever built by wingspan.

That launch method is similar to the one being developed by billionaire Richard Branson’s Virgin Galactic.

Stratolaunch’s plane is designed to carry a rocket and payload with a combined weight of up to 550,000 pounds (250,000 kg), on par with what a SpaceX Falcon 9 rocket can launch from the ground.

Timing is everything

Around 800 small satellites are expected to launch annually beginning around 2020, more than double the annual average over the past decade, according to Teal Group space analyst Marco Caceres.

Stratolaunch announced plans for the plane years ago with the goal of flying Northrop Grumman Corp’s small-payload Pegasus rocket in 2020, and some in the aerospace industry expected Stratolaunch to eventually make its own rockets after partnerships with other manufacturers fell through.

Stratolaunch said its new medium-lift rocket with a capacity of about 3,400 kg (7,500 pounds) would fly as early as 2022. It said it was in the early stages of developing a variant with a payload capacity of 6,000 kg. It made no mention of launch customers and declined to say how much it would cost to develop its space vehicles.

Stratolaunch acknowledged it was designing a reusable space plane to carry cargo to and from Earth and a follow-on variant could carry people.
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Cuba’s decision to change its constitution and allow private property ownership has been shrugged off by small farmers, who say the island will never feed itself without far broader reform of state-run agriculture.

Economists would expect farmers to welcome the shift towards private property after decades of strict government control left the island dependent on food imports and farmers unable to earn a decent living.

And though older Cubans are wary of change, younger farmers have indeed welcomed the recent reforms to recognize private property ownership, even if few expect huge dividends.

With 30 hectares of well-maintained guava trees, sweet potato plants and concrete pig pens, Alexei Gonzales has a deep desire to buy the farmland he currently rents from the state.

But a complex web of bureaucracy — be it currency controls, fuel shortages or a lack of private credit — mean Gonzales and six other farmers who spoke with the Thomson Reuters Foundation do not expect to reap big gains from owning their own land.

“Making it easier to buy land won’t really change much if I can’t get diesel,” said 41-year-old Gonzales, pointing to his idle Soviet-made tractor. “They (lawmakers) give lots of speeches but nothing changes… My whole life is working on the land, and I have nothing to show for it.”

On July 22, Cuba’s government voted in favor of a draft for a new constitution that includes the right to own private property.  The reforms were presided over by Miguel Diaz-Canel, who became Cuba’s president in April, replacing brothers Fidel and Raul Castro, who had governed the island since 1959.

The changes are part of a broader shift as Cuba tries to woo foreign investment, boost growth and cut poverty, all while keeping political control in the hands of a single party.

Rich Soil, Slim Pickings

Despite rich soil and 20 percent of its population working in agriculture, Cuba imports more than 60 percent of its food, at an annual cost of about $2 billion.

Cubans, who on average earn about $30 a month, receive a monthly package of subsidized food from the state, including rice, beans, eggs and milk for young children.

To make up for shortfalls at state-run stores – which worsened after the collapse of its Soviet benefactor – Cubans were encouraged to grow urban gardens or cultivate small plots of land for personal consumption.

Today, Cubans can buy food from market stalls, but workers who earn the minimum government salary often cannot afford the bananas, plantain and pork sold in the private sector.

Prior to the constitutional changes approved by lawmakers last month, the state owned about 80 percent of Cuba’s farmland, leasing most of it to farmers and cooperatives.

The rest is owned by small farmers whose families received allotments from the government after Cuba’s 1959 revolution.

With sluggish economic growth, and renewed tensions with Washington hampering foreign investment, the government is eager to wean Cuba’s 11 people million off costly food imports.

The constitutional change allowing for private land ownership still needs to pass a referendum, to be held some time in coming months. The draft document will be submitted for public consultations and the final document, which could include changes, will then be put to a national referendum.

The reforms will help food production but private property rights alone will not give agricultural output a substantial boost, said Mario Gonzalez-Corzo, an economics professor at City University of New York, whose family own farms in Cuba.

In other countries, farmers can use their land as collateral for loans to buy equipment, seeds or fertilizer.

“Private ownership does not mean you can use land as collateral: in Cuba, there is no such thing as a private bank,” Gonzalez-Corzo said, so the reforms will not make it easier for farmers to buy the fuel or fertilizer they crave.

Price controls on how much farmers get for their products and other strict rules compound the inefficiencies, he added.

“The government has extensive control over agriculture, which creates massive distortions.”

Fallow Fields

Yasmany Falcon Bacallao farms 26 hectares in Matanzas, Cuba’s second largest province and home to the tourist hotspot of Varadero.

Living the inefficiencies on a daily basis, he supports private property reforms, but is not optimistic they will change his daily reality in the fields.

Much of the land inherited from family members lies fallow; he cannot find workers willing to accept $20 per month to toil in the fields or enough diesel to run his farm machinery.

Bacallao sells most of his produce to a government agency, “but often they don’t even have boxes for the mangoes when they arrive, so I can’t sell anything,’ the 37-year-old said.

Cuba’s National Association of Small Farmers, a government-linked body responsible for agriculture, declined requests for interviews or additional information about the changes.

The United Nations Food and Agriculture Organization in Cuba declined to comment on the proposed reforms, underlining the sensitivity of the issue in the socialist state.

Generational Shift

While young farmers tend to support greater private property rights, in principle at least, older Cubans are skeptical.

“I don’t want to see the big time selling of land,” said 82-year-old Miguel Barroz Lozano, sitting on the porch of the farmhouse he inherited in 1962.

“I was here before the revolution and it’s better for farmers now,” said the fruit grower, recounting how his father had toiled on a plantation owned by a rich, absentee owner.

Unease about possible exploitation has caused the government to move slowly with reform, said John Finn, a professor who studies Cuban agriculture at Christopher Newport University in the U.S. state of Virginia.

“Land reform was massively important for the ideology of the revolution,” Finn said. “They (officials) are trying to maintain the broad structures of a socialist economy, while harvesting the obvious power of entrepreneurship.”
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Foreign-brand automakers with U.S. plants do not support Trump administration rules to raise the amount of local content in North American-made vehicles, a group representing companies including Toyota, Volkswagen AG and Hyundai has told key U.S. lawmakers.

Talks between Mexican Economy Minister Ildefonso Guajardo and U.S. Trade Representative Robert Lighthizer are due to resume on Tuesday in Washington to try to resolve remaining bilateral issues so that Canada, which has been sidelined for weeks from the negotiations, can return to the bargaining table.

The automakers’ position was in a previously unreported Aug. 16 letter from their “Here for America” group to top trade-focused members of Congress. The letter could raise resistance to a revamped North American Free Trade Agreement from lawmakers in southern states, where foreign manufacturers have built auto plants.

“We remain concerned that, without further clarifications, assurances and modifications, many of those companies producing vehicles in multiple states will not be in a position to support legislation implementing a NAFTA 2.0,” the group said in the letter, signed by John Bozzella, president of the Association of Global Automakers.

Automotive experts have said that some foreign brand automakers with smaller North American manufacturing footprints and fewer U.S. research and development staff may have difficulty meeting the more stringent content requirements for years.

The group said its members, which also include Honda, Daimler, BMW, Nissan, Kia Motors, Subaru, and Volvo, a unit of China’s Geely Automobile Holdings , account for nearly 50 percent of U.S. vehicle production.

Detroit supportive

At the same time, the American Automotive Policy Council, which represents Detroit’s Big Three automakers is “encouraged by the direction of the discussions,” said Matt Blunt, who heads the trade group.

“We share the administration’s overall goals of strengthening U.S. auto manufacturing and creating jobs and given the importance of NAFTA to U.S. industry we urge the negotiators to quickly complete the negotiations,” added Blunt, whose group represents General Motors, Ford and Fiat Chrysler.

The United States and Mexico are closing in on a bilateral deal on autos that would lift the requirement for North American content in regionally made vehicles to at least 70 percent from the current 62.5 percent.

The deal is expected to require that some 40 percent of  the value come from high wage locations paying at least $16 an hour, meaning the United States and Canada, a Mexican source close to the talks told Reuters.

USTR officials have been meeting in recent days with individual automakers to secure support for potential changes, according to auto industry sources.

A USTR spokeswoman declined comment.

U.S. President Donald Trump, who launched the renegotiation of the 1994 pact a year ago, has said he wants the reworked deal to bring manufacturing jobs back to the United States, particularly in autos and auto parts.

Other key unresolved issues include the phase-in time for the new automotive rules to take effect and whether the U.S. demand for a “sunset” clause that forces a renegotiation every five years is adopted, making long-term investment decisions more difficult.

The letter from the ad-hoc “Here for America” group also raised concerns that national security tariffs on autos, auto parts, steel and aluminum would undermine the benefit of a NAFTA agreement.
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Iran’s oil minister says France’s oil giant Total SA has pulled out of Iran after cancelling its $5 billion, 20-year agreement to develop the country’s massive South Pars offshore natural gas field over renewed U.S. sanctions.

The parliament’s website ICANA.ir quoted Oil Minister Bijan Zanganeh as saying on Monday that since Total first announced its decision a while ago, Iran has been in the process of “looking for an alternative” to Total. He didn’t elaborate.

 

There was no immediate comment from TotaI.

 

Earlier this month, Iran said China’s state-owned petroleum corporation took a majority 80 percent share of the project. CNPC originally had some 30 percent of shares in the project.

 

The renewed U.S. sanctions took effect in August, after America’s pullout from the nuclear deal in May.

 

 
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Vietnam is trying to get a grip on inflation that might otherwise threaten its quick economic growth again as it did a decade ago, analysts and domestic media say.

Consumer prices in June were 4.67 percent higher than in the same month last year following an increase of 3.29 percent in the first half of 2018, the Vietnamese General Statistics Office said. The legislature had set a target of no more than 4 percent.

Prices of commodities, including crude oil, are contributing heavily to inflation, and a fuel tax proposed for October would exacerbate it, the VnExpress International news website said. Currency weakness, a rising middle class and credit growth are further raising prices.

“I think generally the trend has been upward and that’s just a result of increased spending power on behalf of Vietnamese people,” said Maxfield Brown, senior associate with the business consultancy Dezan Shira & Associates in Ho Chi Minh City.

Inflation of more than 20 percent in 2008 throttled Vietnamese economic growth over the following three years. The target of 4 percent inflation is aimed at stopping a repeat.

“It’s something to watch,” Brown said. “Obviously, if things go way, way high, then that’s a problem. But that’s not what’s happening right now.”

Noticeable change in prices

Consumers notice the higher fuel prices when pumping gas for cars and scooters. Some also found that rice prices didn’t fall as expected after a 10 percent hike before the major annual Tet holiday in February this year, said Vietnamese consumer Phuong Hong, communications director with a tech firm in Ho Chi Minh City.

Electricity costs more every year, she added, while salaries do not necessarily help common people afford the increases.

“Normally the rate of price rising is always too much and always higher than the rate we’ve got from salary support,” she said.

Vietnam raised its minimum wage 6.5 percent this year with plans for another 5.3 percent in 2019. About a third of the 93 million Vietnamese will be middle-class or above by 2020, the Boston Consulting Group estimates. Rising wealth reflects creation of jobs, a function of economic growth driven by manufacturing.

The country faces pressure to keep wages in check as low labor costs drive foreign investors to the country from around Asia, as well as a few giant American firms.

Vietnam’s GDP in the first half of this year grew about 7 percent after several years near 6 percent. The Asian Development Bank estimates 7.1 percent growth for the full year.

Risk of fallout, government follow-up

Last year “marked a breakthrough” in government work to manage prices of electricity, fuel, formula milk and healthcare fees, VnExpress International said.

Government agencies “should closely monitor price movements,” take a lead in readying goods for Tet so prices stay controlled and “set out rational measures” to stabilize the market, the Communist Party of Vietnam’s website Nhan Dan said. Last month legislators were reexamining the fuel tax.

Officials are on guard for a relapse of inflation in 2008, which followed an influx of foreign currency into the export-reliant country due to the demand for imports, analysts say. Inflation then rippled into the broader economy until 2011.

Prices have been rising now since 2015.

The inflation of 2008 prompted hundreds of wildcat labor strikes by workers who wanted more pay. Prices, strikes and a devalued Vietnamese currency then took the annual economic growth rate down to 5.3 percent before it began to rebound.

Those pressures sparked a fall in pledges for foreign direct investment – the likes of factories that make garments, furniture and car parts. Pledges fell in 2011 to $14.7 billion, from $19.9 billion in 2010, and the amount of actual foreign direct investment plummeted 35 percent that year.

Vietnam’s growth is one of the fastest in Asia today.

Analysts expect Vietnam to weather the current price hikes without the blowup of 10 years ago but warn against currency deflation that has swept other parts of Asia – partly because of the Sino-U.S. trade war. Weaker currencies usually push prices up.

“At the moment we don’t expect really a ramp-up of inflationary pressure,” said Marie Diron, managing director with Moody’s Investors Service in Singapore. But, she said, “with the weakening of the currency, inflation is likely to go up a bit further in Vietnam and other countries.”
…

“For the first time since early 2010, Greece can stand on its own feet,” the European Stability Mechanism (ESM) rescue fund said as Athens exited its final, three-year international bailout program on Monday.

The ESM allocated about $71 billion over the past three years, after an agreement was reached in August 2015 to help the country cope with fallout from an ongoing debt crisis.

“Today we can safely conclude the ESM program with no more follow-up rescue programs,” Mario Centeno, the chairman of the ESM’s board of governors, said in a statement. “This was possible thanks to the extraordinary effort of the Greek people, the good cooperation with the current Greek government and the support of European partners through loans and debt relief.”

In 2010, Greece was declared at risk of default after struggling with massive debt, loss of investment and huge unemployment. Overall, nearly $300 billion in emergency loans were provided in three consecutive bailout packages from a European Union bailout fund and the International Monetary Fund (IMF). In exchange, Athens was required to put in place severe austerity-based measures and reforms.

The completion of the loan program is a major accomplishment for Greece, but the country still faces an uphill battle to regain its economic stability.

 

The office of Prime Minister Alexis Tsipras described the final bailout loan last week as the “last act in the drama. Now a new page of progress, justice and growth can be turned.”

“Greece has managed to stand on her feet again,” his office said.

 

Economic growth in Greece is slowly growing again, tourism is up nearly 17 percent in Athens this year, and once-record levels of joblessness are finally receding.

 

However, the country still faces massive challenges, including weak banks, the highest debt load in the European Union at 180 percent of GDP, and the loss of about a half-million mostly younger Greeks to Europe’s wealthier neighbors. Greece will also need to continue to repay its international loans until 2060.

The country’s three international bailouts took Europe to the brink of crisis.

 

The financial troubles exposed dangers in the European Union’s common currency and threatened to break the bloc apart. The large debt that remains in Greece and an even larger debt in Italy continue to be a financial danger to the EU.

The bailouts also led to regular and sometimes violent demonstrations in Athens by citizens angry at the government’s budget measures required by international lenders in return for the bailouts.

 

While Greece has begun to make economic progress, economics say the bulk of the austerity measures will likely need to remain in place for many years for the country to tackle its massive debt.

Some international economists have called for part of Greece’s loans to be written off in order for Greece to keep its ballooning debt payments in check. However, any kind of loan forgiveness would be a tough sell in Germany where the initially bailouts were unpopular.

The austerity measures included massive tax hikes as high as 70 percent of earned income and pension cuts that pushed nearly half of Greece’s elderly population below the poverty line.

Pensioner Yorgos Vagelakos, 81, told Reuters that five years ago he would go to his local market with 20 euros in his pocket, while today, he has just 2 euros. He says for him, the bailout will never end.

“It’s very often that just like today, I struggle, because I see all the produce on display at the market and I want to buy things, but when I don’t have even a cent in my pocket, I get really sad,” Vagelakos said.
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Americans drink a lot of beer, according to the Beer Institute, almost 100 liters for every drinking age American each year. That’s a lot of malted barley, the main ingredient that gives beer its alcoholic kick. Even smaller craft breweries in the U.S. alone, throw out some two million tons of the spent grain each year into landfills. But one entrepreneur has found other uses for all that wasted grain. She’s recycling spent barley into flour. VOA’s Jill Craig has more.
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Uncertainty reigned in Venezuela Saturday after President Nicolas Maduro unveiled a major economic reform plan aimed at halting the spiraling hyperinflation that has thrown the oil-rich, cash-poor South American country into chaos.

Ahead of a major currency overhaul Monday, when Caracas will start issuing new banknotes after slashing five zeroes off the crippled bolivar, Maduro detailed other measures he hopes will pull Venezuela out of crisis.

Those measures include a massive minimum wage hike, the fifth so far this year.

But analysts say the radical overhaul could only serve to make matters worse.

“There will be a lot of confusion in the next few days, for consumers and the private sector,” said the director of the Ecoanalitica consultancy, Asdrubal Oliveros. “It’s a chaotic scenario.”

​‘Pure lie’

The embattled Maduro, a former bus driver and union leader, said the country needed to show “fiscal discipline” and stop the excessive money printing that has been regular practice in recent years.

The new currency, the sovereign bolivar — to distinguish from the current, and ironically named, strong bolivar — will be anchored to the country’s widely discredited cryptocurrency, the petro.

Each petro will be worth about $60, based on the price of a barrel of Venezuela’s oil. In the new currency, that will be 3,600 sovereign bolivars, signaling a massive devaluation.

In turn, the minimum wage will be fixed at half a petro (1,800 sovereign bolivars), starting Monday. That is about $28, more than 34 times the previous level of less than a dollar at the prevailing black market rate.

Maduro also said the country would have one fluctuating official exchange rate, also anchored to the petro, without saying what the starting level would be.

As it stands, the monthly minimum wage, devastated by inflation and the aggressive devaluation of the bolivar, is still not enough to buy a kilo of meat.

In the capital Caracas, residents were skeptical about the new measures.

“Everything will stay the same, prices will continue to rise,” 39-year-old Bruno Choy, who runs a street food stand, told AFP.

Angel Arias, a 67-year-old retiree, dubbed the new currency a “pure lie!”

1 million percent inflation

The International Monetary Fund predicts inflation will hit a staggering 1 million percent this year in Venezuela, now in a fourth year of recession, hamstrung by shortages of basic goods and crippled by paralyzed public services.

Maduro blames the country’s financial woes on opposition plots and American sanctions, but admits that the government will “learn as we go along” when it comes to the currency redenomination.

His government pushed back Saturday against criticism of the economic reform plan.

“Don’t pay attention to naysayers,” Information Minister Jorge Rodriguez said. “With oil income, with taxes and income from gasoline price hikes … we’ll be able to fund our program.”

Electronic transactions are set to be suspended from Sunday to facilitate the introduction of the new notes.

Economy in turmoil

Oil production accounts for 96 percent of Venezuela’s revenue, but that has slumped to a 30-year low of 1.4 million barrels a day, compared to its record high of 3.2 million 10 years ago.

The fiscal deficit is almost 20 percent of GDP while Venezuela struggles with an external debt of $150 billion.

Venezuela launched the petro in a bid for liquidity to try to circumvent US sanctions that have all but stamped out international financing.

But there’s a good reason the redenomination hasn’t generated renewed hope or investor confidence: Venezuela has done this before.

Maduro’s predecessor Hugo Chavez stripped three zeroes off the bolivar in 2008, but that failed to prevent hyperinflation.

Also, Cryptocurrency rating site ICOindex.com has branded the petro a scam, and the U.S. has banned its nationals from trading in it.
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A budding trade war between the U.S. and Turkey over a detained American pastor is having global consequences. A sharp drop in Turkey’s lira, inflation and the threat of loan defaults, could drag down other economies, particularly in emerging markets. Turkey’s troubles are causing ripple effects in countries as far away as Argentina and Indonesia, while weighing on Asian currency rates and triggering currency fluctuations. VOA’s Diplomatic Correspondent Cindy Saine reports from Washington.
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Turkey’s currency this month has suffered heavy falls triggered by U.S.-Turkish tensions over the ongoing detention of an American pastor. Washington’s threat to impose new economic sanctions sparked another steep currency drop Friday. Dorian Jones reports on the economic fall out for people in Istanbul.
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Tesla shares dropped nearly 9 percent in value Friday, amid reports of CEO and co-founder Elon Musk meeting with the U.S. Securities and Exchange Commission (SEC).

Musk wrote on Twitter last week of his plans to take the company private for a price of $420 per share, writing that he had “funding secured.” On Monday, in a blog post, Musk admitted that was not true, as he was still waiting on a finalized deal with his investors, a Saudi Arabian foreign investment fund.

“I continue to have discussions with the Saudi fund, and I also am having discussions with a number of other investors, which is something that I always planned to do since I would like for Tesla to continue to have a broad investor base,” Musk wrote.

Since Musk’s original tweet, the company’s shares have dropped 12 percent overall, and reports of subpoenas being issued by the SEC have sent the company into turmoil.

In a New York Times interview Thursday, Musk said, “This past year has been the most difficult and painful year of my career.” The Times also reported that members of Tesla’s board are concerned with Musk’s drug use, notably his use of the sleep aid Ambien, which some believe have contributed to Musk’s controversial Twitter statements.

Last month, Musk came under fire for calling one of the cave divers who rescued 12 Thai soccer players and their coach a pedophile, citing no evidence. He later apologized for that remark.
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Stocks rose late in the day Friday as investors welcomed signs of progress in resolving the trade dispute between the U.S. and China. The Wall Street Journal reported that the countries hope to have a resolution by November.

Industrial, health care and basic materials companies made some of the biggest gains. The report came a day after China said it will send an envoy to Washington for the first talks between the countries since early June.

Marina Severinovsky, an investment strategist at Schroders, said stocks could jump if the U.S. and China make real progress toward a trade agreement. But stocks in emerging markets might make even bigger gains.

“The rally that could come, if there is a better outcome, would be in emerging markets,” she said. “China has suffered pretty greatly … the U.S. has held up pretty well.”

The late gains came in spite of weak results for several chipmakers. Electric car maker Tesla took its biggest drop in two years on reports of a wider government investigation into the company and concerns about CEO Elon Musk’s health.

The S&P 500 index rose 9.44 points, or 0.3 percent, at 2,850.13. The Dow Jones Industrial Average added 110.59 points, or 0.4 percent, to 25,669.32. The Nasdaq composite edged up 9.81 points, or 0.1 percent, to 7,816.33. The Russell 2000 index of smaller-company stocks gained 7.19 points, or 0.4 percent, to 1,692.95.

The Wall Street Journal cited officials in both the U.S. and China as it said negotiators want to end the trade war before U.S. President Donald Trump and Chinese President Xi Jinping meet at multilateral events in November.

Industrial companies made some of the biggest gains after agricultural equipment maker Deere posted stronger than expected sales. Its stock rose 2.4 percent to $140.59.

Construction equipment maker Caterpillar rose 2.3 percent to $139.34 and engine maker Paccar added 2.3 percent to $67.16.

Chipmakers fell after two companies gave weaker forecasts for the third quarter. Nvidia said it no longer expects much revenue from products used in mining digital currencies, and its stock fell 4.9 percent to $244.82. Applied Materials slumped 7.7 percent to $43.77.

While big names like Netflix, Facebook and Amazon slipped, Apple led technology companies slightly higher overall. Apple stock rose 2 percent to $217.58.

Nordstrom jumped 13.2 percent to $59.18 after raising its annual profit and sales forecasts and posting better earnings and sales than analysts expected. It’s been a mostly difficult week for department stores as Macy’s and J.C. Penney both plunged after issuing their quarterly reports.

The S&P 500 finished this week with a solid gain of 0.6 percent, but it took a difficult path to get there. Stocks fell early this week due to worries about Turkey’s currency crisis, and later investors fretted about China’s economic growth.

The recovery started Thursday as investors hoped the upcoming talks between the U.S. and China will help end the impasse that has resulted in higher tariffs from both countries.

The Hang Seng index in Hong Kong has fallen 13 percent since early June as the dispute has dragged on, and other emerging market indexes have also taken a hit. The S&P 500 has risen over that time.

Tesla was hit with a series of reports that concerned shareholders. The Wall Street Journal reported that the Securities and Exchange Commission started investigating the electric car maker last year to determine if it made false statements about production of its Model 3 sedan.

The SEC is also reportedly looking into CEO Elon Musk’s comment on Twitter about possibly taking the company private.

Tesla stock rose from about $345 a share to about $380 following Musk’s tweet last week, which said Tesla could go private for $420 a share. On Friday it dropped 8.9 percent to $305.50.

Musk also gave an emotional interview to the New York Times, published Friday, about the stress he’s experienced as the company tries to ramp up production. He said this year has been “excruciating” and described working up 120 hours a week, raising concerns about his health.

Bond prices rose. The yield on the 10-year Treasury note fell to 2.86 percent from 2.87 percent.

U.S. crude picked up 0.7 percent to $65.91 a barrel in New York. Brent crude, the standard for international oil prices, added 0.6 percent to $71.83 per barrel in London.

Wholesale gasoline dipped 0.3 percent to $1.98 a gallon. Heating oil inched up 0.1 percent to $2.10 a gallon. Natural gas rose 1.3 percent to $2.95 per 1,000 cubic feet.

Gold was little changed at $1,184.20 an ounce. Silver fell 0.6 percent to $14.63 an ounce. Copper added 0.5 percent to $2.63 a pound.

The dollar dipped to 110.60 yen from 110.88 yen. The euro rose to $1.1443 from $1.1365.

The German DAX lost 0.2 percent and France’s CAC 40 fell 0.1 percent. The FTSE 100 in Britain was little changed.

Japan’s Nikkei 225 index added 0.4 percent and Hong Kong’s Hang Seng gained 0.4 percent. In South Korea, the Kospi gained 0.3 percent.
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Unions at Air France-KLM voiced concern after the company appointed Benjamin Smith as the new CEO with the support of the French state.

The company said Thursday that Smith, who is 46 and was previously Air Canada’s chief operating officer, will fill the role by Sept. 30.

Vincent Salles, unionist at CGT-Air France union, said on France Info radio that unions fear Smith’s mission is to implement plans that would “deteriorate working conditions and wages.”

The previous CEO, Jean-Marc Janaillac, resigned in May after Air France employees held 13 days of strike over pay and rejected the company’s wage proposal, considered too low.

Finance Minister Bruno Le Maire welcomed an “opportunity” for Air France-KLM and expressed his confidence in Smith’s ability to “re-establish social dialogue.”
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President Donald Trump says he’s asking federal regulators to look into the effectiveness of the quarterly financial reports that publicly traded companies are required to file.

In a tweet early Friday, Trump said that after speaking with “some of the world’s top business leaders,” he’s asked the U.S. Securities and Exchange Commission to determine whether shifting to a six-month reporting regimen would make more sense.

The SEC requires such companies to share profit, revenue and other figures publicly every three months.

Some believe executives are making decisions based on short-term thinking to satisfy the market at the expense of the long-term viability of their companies.

There are also tremendous expenses tied to preparing quarterly and annual reports.
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As summer comes to a close and kids prepare to head back to school, retailers are counting on novelty items such as scented markers and glitter glue to help win back some of the market share they’ve lost to iPads and popular electronic gadgets. VOA’s Jill Craig takes a look at retailers back to school strategy.
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A potential ban on the popular herbicide glyphosate in Brazil over concerns it may cause cancer in humans would be a “disaster” for the country’s agricultural industry, Agriculture Minister Blairo Maggi said on Thursday.

A Brazilian court ruled on Aug. 3 that new products containing the chemical could not be registered in the country and existing registrations would be suspended starting from September, until health authority Anvisa issues a decision on its re-evaluation of glyphosate’s safety.

Maggi said that glyphosate is used on around 95 percent of soy, corn and cotton harvested in the country and that there is no readily available substitute. Brazil is the world’s top exporter of soy and a major producer and exporter of corn.

“Glyphosate makes it viable for us to plant and grow crops.

What is the alternative?” Maggi said at an event in Rio de Janeiro.

Brazil’s Solicitor General’s office has said it is preparing an appeal to the court decision with the Agriculture Ministry’s backing. Maggi said he is confident the ruling will be overturned on appeal.

The Brazilian court case is part of a global pushback against the chemical. A U.S. judge ruled last week that Monsanto must pay $289 million in damages to a man who alleged its glyphosate-based products like Roundup caused his cancer.

Monsanto, taken over earlier this year by Bayer AG , said in a statement that more than 800 reviews, including those by the U.S. environmental and health authorities, support that glyphosate does not cause cancer. The company is appealing the U.S. court ruling.

Brazil federal prosecutors brought the case to force Anvisa to make a decision in its re-evaluation of glyphosate, which it started in 2008, said Marco Antonio Delfino de Almeida, a member of a prosecutors’ working group on pesticides.

A 2015 assessment by the World Health Organization’s International Agency for Research on Cancer determined glyphosate probably causes cancer in humans, which provides a basis for reconsidering its safety, Almeida said.

If the Brazil ban on existing product registrations goes into effect, it could disrupt farmers who are set to begin planting soy in September.

The sale of glyphosate products would be halted and farmers who use products with suspended registrations could face legal risks, said Brazil-based agribusiness lawyer Frederico Favacho.

Anvisa told Reuters it is prioritizing its re-evaluation of glyphosate but did not give a timeframe for announcing its findings.
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Finance Minister Berat Albayrak assured international investors on Thursday that Turkey would emerge stronger from its currency crisis, insisting its banks were healthy and signalling it could ride out a dispute with the United States.

In a conference call with thousands of investors and economists, Albayrak — who is President Tayyip Erdogan’s son-in-law — said Turkey fully understood and recognised all its domestic challenges but was dealing with what he described as a market anomaly.

With Ankara locked in a complex rift with Washington, he also played down a decision by President Donald Trump to double tariffs on imports of Turkish metals. Washington later said it was ready to impose further economic sanctions on Turkey.

Many countries had been the target of similar U.S. trade measures, Albayrak said, and Turkey would navigate this period with other parties such as Germany, Russia and China.

Turkey, he said, has no plans to seek help from the International Monetary Fund or impose capital controls to stop money flowing abroad in response to the recent collapse of its lira currency.  Before he spoke, the lira strengthened more than 3 percent, despite signs that the dispute with the United States is as wide as ever.

The lira held steady during Albayrak’s conference call but later weakened when Treasury Secretary Steven Mnuchin said the United States was prepared to levy more sanctions on Turkey if detained American pastor Andrew Brunson was not freed.

The Turkish currency was trading at 5.85 at 1740 GMT, more than 1 percent stronger on the day. Turkey’s sovereign dollar bonds extended their gains.

The lira hit a record low of 7.24 to the dollar earlier this week, down 40 percent this year, as investors fretted over Erdogan’s influence over monetary policy and the row with the United States.

Turkey’s foreign minister said Ankara did not want any problems with Washington.

“We can solve issues with the United States very easily, but not with the current approach,” Mevlut Cavusoglu told a news conference in Ankara late on Thursday.

Facing Turkey’s gravest currency crisis since 2001 in his first month in the job, Albayrak has the daunting task of persuading investors that the economy is not hostage to political interference.

Albayrak, a 40-year-old former company executive with a doctorate in finance, said Turkey would not hesitate to provide support to the banking sector. The banks were capable of managing the volatility, and there had been no major flow of cash out of deposits lately, he added.

Qatari pledge

Economists gave Albayrak’s comments a qualified welcome, and praised his ambition to get inflation down into single figures next year from above 15 percent now. But his father-in-law’s opposition to higher interest rates may complicate that quest.

“He said all the right things, but it’s one thing saying them and another thing doing them,” said Sailesh Lad at AXA Investment Managers. “He said capital controls weren’t part of the agenda, and never will be. I think a lot of the market liked hearing that.”

The lira gained some support from the announcement late on Wednesday of a Qatari pledge to invest $15 billion in Turkey. Trump has used trade tariffs in a series of disputes ranging from with Turkey and China to the European Union.

In a sign that Turkey may hope to make common cause with other affected countries, Erdogan and French President Emmanuel Macron spoke by phone on Thursday, discussing developing economic and trade ties and boosting bilateral investment, a Turkish presidential source said.

Albayrak will also meet his German counterpart Olaf Scholz in Berlin on Sept. 21.

However, in a potential complication, a foreign ministry source in Berlin said Turkish police had arrested a German citizen. ARD TV reported the man was accused of “terrorist propaganda” after criticising the government on social media.

In another element of the row with Washington, a U.S. court sentenced a senior executive of state-owned Turkish lender Halkbank to 32 months in prison in May for taking part in a scheme to help Iran evade U.S. sanctions. That case has increased speculation that the bank itself could be fined for sanctions-busting.

Halkbank has said all of its transactions were lawful and Albayrak played down the risk. “We are not expecting any fines on Halkbank for sure,” he said. “But hypothetically speaking, …if one of our public banks need help, the government will stand strong by it for sure.”

The White House said on Wednesday that it would not remove steel tariffs on Turkey, appearing to give Ankara little incentive to work for the release of Brunson, a pastor on trial in Turkey on terrorism charges.

Washington wants the evangelical Christian freed but Turkish officials say the case is a matter for the courts.

The pastor row is one of several between the NATO allies, including diverging interests in Syria and U.S. objections to Ankara’s ambition to buy Russian defence systems, that have contributed to instability in Turkish financial markets.

Economic war

Erdogan has repeatedly told Turks to exchange gold and hard currency into lira, saying the country was involved in an economic war with enemies.

However, Turks appeared not to be heeding his appeal. Central bank data showed foreign currency deposits held by local investors rose to $159.9 billion in the week to Aug. 10, from $158.6 billion a week earlier.

Erdogan has called for a boycott of U.S. electronic goods and Turkish media have given extensive coverage to anti-U.S. protests, including videos on social media showing Turks apparently burning dollar bills and destroying iPhones.
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A federal court in New York has charged 22 Chinese importers with smuggling nearly half-a-billion dollars in counterfeit goods into the United States from China.

The fake products include such popular luxury items as Louis Vuitton bags, Michael Kors wallets, and Chanel perfume.

Twenty-one of the defendants were arrested Thursday.

U.S. attorneys say the suspects allegedly smuggled the China-made counterfeit goods in large shipping containers disguised as legitimate products and brought them into ports in New York and New Jersey.

The defendants apparently intended to sell the fake products across the United States with a street value of nearly $500 million.

Along with smuggling and trafficking in counterfeit goods, the suspects are also charged with money laundering and immigration fraud.

“The illegal smuggling of counterfeit goods poses a real threat to honest business,” assistant attorney general Brian Benczkowski said. “The Department of Justice is committed to holding accountable those who seek to exploit our borders by smuggling counterfeit goods for sale on the black market.”
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Russia says the latest U.S. sanctions imposed on Russian, Chinese, and Singaporean companies are “destructive” and “useless.”  

The U.S. penalized the three companies Wednesday, accusing them of helping North Korea avoid international sanctions.

The Russian Foreign Ministry said Thursday the new U.S. sanctions come when “joint international efforts” are needed toward a settlement in North Korea. Moscow said the sanctions could undermine denuclearization talks.

The U.S. has accused a Chinese trading company and its affiliate in Singapore of falsifying documents aimed at easing illegal shipments of alcohol and cigarettes into North Korea. The companies are said to have earned more than $1 billion.

A Russian company was also sanctioned for providing port services to North Korean-flagged ships engaged in illegal oil shipments.

The sanctions freeze any assets the companies may have in the United States and bars Americans from doing business with them.
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