YCLOAK

Halima Sheikh Ali is the proud owner of one of the few ATMs in Wajir town in northeast Kenya. But rather than doling out shilling notes, it dispenses something tastier: a fresh pint of camel milk.

“For 100 Kenyan shillings ($1), you get one liter of the freshest milk in Wajir County,” she says, opening a vending machine advertising “fresh, hygienic and affordable camel milk” in order to check the liquid’s temperature.

One of the world’s biggest camel producers, East Africa also produces much of the world’s camel milk, almost all of it consumed domestically.

In the northeast Kenyan county of Wajir, demand is booming among local people, who say it is healthier and more nutritious than cow’s milk.

“Camel milk is everything,” said Noor Abdullahi, a project officer for U.S.-based aid agency Mercy Corps. “It is good for diabetes, blood pressure and indigestion.”

But temperatures averaging 40 degrees Celsius (104 degrees Fahrenheit) in the dry season, combined with the risk of dirty collection containers, mean the liquid can go sour in a matter of hours, he added, making it much harder to sell.

To remedy this, an initiative is equipping about 50 women in Hadado, a village 80km from Wajir, with refrigerators to cool the milk that remote camel herders send them via tuk-tuk taxi, plus a van to transport it daily to Wajir.

There a dozen women milk traders, including Sheikh Ali, sell it through four ATM-like vending machines, after receiving training on business skills such as accounting.

“The (milk) supply and demand are there. We just have to make it easier for the milk to get from one point to another,” said Abdullahi.

The project, which is part of the Building Resilience and Adaptation to Climate Extremes and Disasters (BRACED) program, is funded by the U.K. Department for International Development (DFID) and led by Mercy Corps.

Fresh and Lucrative

Asha Abdi, a milk trader in Hadado who operates one of the refrigerators with 11 other women, said she used to have to boil camel’s milk — using costly and smoky firewood — to prevent it turning sour.

“I spent 100 shillings ($1) a day on firewood, and the milk would often go bad by the time it got to Wajir as the (public) transport took over three hours,” she said.

Now Abdi and the other women in her group send about 500 liters of fresh milk to Wajir every day — a trip that takes just over an hour by van. They then reinvest the profits in other ventures.

“With the milk money I bought 20 goats,” said Abdi as she rearranged bags of sugar in her crowded kiosk. “But my dream would be to export the camel milk to the United States,” she added. “I hear it’s like gold over there.”

Drought-safe Investment

Amid hundreds of camels roaming stretches of orange dirt outside of Hadado, Gedi Mohammed sits under the shade of a small acacia tree.

“The (tuk-tuk) drivers should be here soon to buy my camel milk,” he said, sipping the precious liquid from a large wooden bowl.

In Kenya’s largely pastoralist Wajir County, prolonged drought is pushing growing numbers of the region’s nomadic herders to see camels — and their milk — as a drought-safe investment.

Mohammed, who used to own over 100 cows, said he exchanged them a decade ago for camels, “which drink a lot of water but can then survive eight days without another drop, when a cow will die after two days.”

But even camels suffer when the weather is really dry, he added.

“Drought is bad for business because with less food and water the camels produce less milk,” he said, impatiently waving at a teenage boy to fetch a straying camel.

“Business would be better if I had a vehicle to transport the milk to buyers myself,” said Mohammed, who said he has to travel ever-longer distances to find pastures for his animals. “Right now I rely on the (tuk-tuk) drivers to find me, and you never know how long they will be.”

Technical Issues

Back in Wajir, Sheikh Ali said her group’s cooled milk ATM allows her to save about 5,000 shillings ($50) per month, as she no longer has to buy firewood to boil milk and can sell the fresh liquid at a higher price.

But although the vending machines are proving popular, they also have been plagued by technical issues, said Amina Abikar, who also works for Mercy Corps in Wajir.

“Sometimes the machines break down, or indicate that there is no milk left when there are still 100 liters” inside, she explained.

“So we have to wait for the machine supplier’s technician to travel all the way from Nairobi. It would be better to train someone locally,” she said.

Also slowing down business growth is the high rate of illiteracy among women involved in the project, Abikar said.

Sheikh Ali, who cannot read or write, relies on her son to operate the machine and check its various indicators.

“I would love to do it myself but I don’t know my ABCs,” she said, adding that she still feels “proud that I am one of the only fresh milk traders in Wajir.”
…

The European Union has warned the United States that President Donald Trump’s threat to impose a 20 percent tariff on imported European cars would seriously hurt the U.S. economy and invite retaliatory levies on up to $294 billion in U.S. exports.

In a 10-page letter sent to the U.S. Commerce Department last Friday, the European Union said that new tariffs on European-made vehicles and auto parts were unjustifiable and would be an economic mistake.

Trump has often attacked the EU trade surplus with the United States — $101 billion last year — and criticized the 28-nation bloc for its 10 percent tariff on U.S. car imports compared to the 2.5 percent levy the U.S. imposes.  In late May, Trump ordered the Commerce agency to investigate whether the 20 percent tariff should be imposed on national security grounds, although it was not immediately clear what security concerns there might be.

U.S. Commerce Secretary Wilbur Ross told CNBC on Monday it was “premature” to say whether Trump will go ahead with the tariff increase.

Meanwhile, Trump criticized the World Trade Organization, telling reporters at the White House, “They have been treating us badly for many, many years.”

He added, “If they don’t treat us fairly, we’ll be doing something,” but offered no further explanation.

The European Commission, the EU executive that handles trade issues, said Monday, “We’ll spare no effort, be it at the technical or political level, to prevent” the United States from imposing the higher tariffs on European car imports. Jean-Claude Juncker, the commission’s president, is headed to Washington later in July in an effort to try to persuade Trump officials to back off the new levies.

“We should de-dramatize these relations,” Juncker told a news conference last week.

On Sunday, Trump attacked EU trade practices, telling Fox News, “The European Union is possibly as bad as China, only smaller. They send a Mercedes in, we can’t send our cars in. Look what they do to our farmers.  They don’t want our farm products. Now in all fairness they have their farmers. … But we don’t protect ours and they protect theirs.”

Europe sent $43.6 billion worth of vehicles to the U.S. last year, compared to $7.1 billion worth of cars the U.S. shipped to Europe. In addition, the European Union says European companies manufactured nearly 2.9 million cars in the United States, directly supporting 120,000 U.S. jobs, or 420,000 jobs if car dealerships and car parts retailers are included.

The U.S.-EU tariff dispute on cars comes at a time Trump has feuded with the European Union, China and Canada over his imposition of new levies on steel and aluminum imports to the U.S.

Last week, the EU retaliated by imposing 25 percent tariffs on U.S. motorcycles, orange juice, bourbon, jeans and other products.

Canada said Sunday it has imposed higher tariffs on $12.6 billion worth of U.S. steel products, toffee, maple syrup, coffee beans and strawberries.

China and the United States, the world’s two biggest economies, are set Friday to impose tit-for-tat higher tariffs on $34 billion worth of goods the two countries export to each other.
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Tesla Inc nearly produced 5,000 Model 3 electric sedans in the last week of its second quarter, with the final car rolling off the assembly line on Sunday morning, several hours after the midnight goal set by Chief Executive Elon Musk, two workers at the factory told Reuters.

The 5,000th car finished final quality checks at the Fremont, California, factory around 5 a.m. PDT (1200 GMT), one person said. It was not clear if Tesla could maintain that level of production for a longer period.

Musk said the company hit its target of 5,000 Model 3s in a week, according to an email sent to employees on Sunday afternoon and seen by Reuters. Tesla also expects to produce 6,000 Model 3 sedans a week “next month.”

“I think we just became a real car company,” Musk wrote. The company hit the Model 3 mark while also achieving its production goal of 7,000 Model S and Model X vehicles in a week, Musk said in the email.

Tesla confirmed the contents of the email.

After repeatedly pushing back internal targets, Tesla vowed in January to build 5,000 Model 3s per week before the close of the second quarter on Saturday to demonstrate it could mass produce the battery-powered sedan.

Money-losing Tesla has been burning through cash to produce the Model 3, and delays have also potentially compromised Tesla’s first-to-market position for a mid-priced, long-range battery electric car as a host of competitors prepare to launch rival vehicles.

Production of the Model 3, which began last July, has been plagued by a number of issues, including problems from an over-reliance on automation on its assembly lines, battery issues and other bottlenecks.

As the end of the quarter neared, Musk spurred on workers, built a new assembly line in a huge tent outside the main factory, and fanned expectations that Tesla could hit its target, including tweeting pictures of rows of auto parts and robots over the final days of the quarter.

“It was pretty hectic,” said one worker who described the atmosphere as “all hands on deck.”

Another worker speaking after the 5,000th car was made described the factory as a “mass celebration.”

Tesla is likely to announce production and delivery numbers for the quarter later this week, and investors will watch to see whether the company can keep up its end-of-quarter production speed and increase efficiency to produce the cars at a profit.

Repeatable?

Tesla will have to prove to investors that it can sustain and increase its production pace, and some skeptics have bet against the company.

Short sellers lost over $2 billion in June due to Tesla’s rising share price and this latest achievement could buoy the company’s shares at market open on Monday.

Shares of Tesla, which closed on Friday at $342.95, are up 40 percent since a year low in April.

In recent months, the company has engaged in so-called “burst builds,” temporary periods of fast-as-possible production, which it uses to estimate how many cars it is capable of building over longer periods of time.

Analyst Brian Johnson of Barclays warned investors in March to be wary of brief “burst rates” of Model 3 production that were not sustainable.

One worker told Reuters that, to meet the goal, employees from other departments were dispatched to parts of the Model 3 assembly line to keep it running constantly, and breaks were staggered “so the line didn’t stop moving.”

The worker also said some areas within the factory were shut down to divert their workers to help out on the Model 3, such as the Model S line.

That suggests that Tesla was able to generally meet its production target through manual labor, rather than the automation Musk originally promised would make Tesla a competitive force in manufacturing. Earlier this year, Musk – who has described his vision for the Fremont factory as an “alien dreadnought” – acknowledged error in adding too much automation, too fast, to the Model 3 assembly line.

In May, Tesla sent a new battery assembly line via cargo planes to its Gigafactory battery plant outside Reno, Nevada, in order to speed production, as first reported by Reuters.

When first unveiled in March 2016, the Model 3 generated thousands of reservations from consumers in an unprecedented show of support for the new vehicle. Most recently in May, Tesla said that despite the delivery delays, its net Model 3 reservations – accounting for new orders and cancellations – exceeded 450,000 at the end of the first quarter.

Despite touting the Model 3 as a $35,000 vehicle, Tesla has yet to begin building that basic version and instead is currently building a higher-priced version. It is not clear how many of the orders are for the more premium version.

Steady progress has enthused others, however, and Tesla’s market value is close to that of General Motors Co.

The company has said it will not need to raise cash this year.

 
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Canada’s retaliatory tariffs on U.S. goods take effect Sunday following the Trump administration’s new tariffs on Canadian steel and aluminum.

Canadian Prime Minister Justin Trudeau’s office said in a statement that the prime minister “had no choice but to announce reciprocal countermeasures to the steel and aluminum tariffs that the United States imposed on June 1, 2018.”

Trudeau and U.S. President Donald Trump spoke late Friday to discuss trade and other economic issues, the White House said Saturday.

“The two leaders agreed to stay in close touch on a way forward,” according to the prime minister’s office.

The telephone conversation between the two leaders was their first encounter since the G-7 summit in Quebec in June. After that meeting, Trump tweeted that Trudeau was “weak” and “dishonest.”

Trudeau also spoke Friday with Mexican President Enrique Pena Nieto to keep him up-to-date on Canada’s response to the U.S. tariffs.

The American goods that Canada has placed tariffs on include ketchup, lawn mowers and motorboats.

Canadian Foreign Minister Chrystia Freeland said the tariffs are regrettable. She said, however, Canada “will not escalate and we will not back down.”

Some of Canadian tariffs on U.S. items are politically targeted.

For example, Canada imports $3 million in yogurt, most of it coming from a plant in Wisconsin, the home state of House Speaker Paul Ryan. U.S. yogurt will now be hit with a 10 percent duty.

Whiskey is also on Canada’s list of tariffs for the U.S. Whiskey comes largely from Tennessee and Kentucky.

Kentucky is the home state of Republican Senate leader Mitch McConnell.
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Iran is studying ways to keep exporting oil and other measures to counter U.S. economic sanctions, state news agency IRNA reported Saturday.

Since last month, when U.S. President Donald Trump pulled out of the nuclear deal that lifted most sanctions in 2015, the rial currency has dropped up to 40 percent in value, prompting protests by bazaar traders usually loyal to the Islamist rulers.

Speaking after three days of those protests, supreme leader Ayatollah Ali Khamenei said the U.S. sanctions were aimed at turning Iranians against their government.

Other protesters clashed with police late Saturday during a demonstration against shortages of drinking water.

“They bring to bear economic pressure to separate the nation from the system … but six U.S. presidents before him [Trump] tried this and had to give up,” Khamenei said on his website Khamenei.ir.

With the return of U.S. sanctions likely to make it increasingly difficult to access the global financial system, President Hassan Rouhani has met with the head of parliament and the judiciary to discuss countermeasures.

“Various scenarios of threats to the Iranian economy by the U.S. government were examined and appropriate measures were taken to prepare for any probable U.S. sanctions, and to prevent their negative impact,” IRNA said.

One such measure was seeking self-sufficiency in gasoline production, the report added.

Looking for buyers

The government and parliament have also set up a committee to study potential buyers of oil and ways of repatriating the income after U.S. sanctions take effect, Fereydoun Hassanvand, head of the parliament’s energy committee, was quoted as saying by IRNA.

“Due to the possibility of U.S. sanctions against Iran, the committee will study the competence of buyers and how to obtain proceeds from the sale of oil, safe sale alternatives which are consistent with international law and do not lead to corruption and profiteering,” Hassanvand said.

The United States has told allies to cut all imports of Iranian oil by November, a senior State Department official said Tuesday.

In the separate unrest, demonstrators protesting against shortages of drinking water in oil-rich southwestern Iran clashed with police late Saturday after officers ordered about 500 protesters to disperse, IRNA reported.

Shots could be heard on videos circulated on social media from protests in Khorramshahr, which has been the scene of demonstrations for the past three days, along with the nearby city of Abadan. The videos could not be authenticated by Reuters.

A number of protests have broken out in Iran since the beginning of the year over water, a growing political concern because of a drought that residents of parched areas and analysts say has been exacerbated by mismanagement.

Speaking before the IRNA report on the clash, Khamenei said the United States was acting with Sunni Muslim Gulf Arab states, which regard Shiite Muslim Iran as their main regional foe, to try to destabilize the government in Tehran.

“If America was able to act against Iran, it would not need to form coalitions with notorious and reactionary states in the region and ask their help in fomenting unrest and instability,” Khamenei told graduating Revolutionary Guards officers, in remarks carried by state TV.
…

U.S. President Donald Trump said in a tweet on Saturday that Saudi Arabia’s King Salman had agreed to his request to increase oil production “maybe up to

2,000,000 barrels” to offset production from Iran and Venezuela.

There was no immediate comment from Saudi authorities.

The world’s top oil exporter plans to pump up to 11 million barrels of oil per day (bpd) in July, an oil industry source told Reuters this week, after OPEC agreed with Russia and other

oil-producing allies to raise output by about 1 million bpd.

 
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President Donald Trump said Saturday that he had received assurances from King Salman of Saudi Arabia that the kingdom will increase oil production, “maybe up to 2,000,000 barrels” in response to turmoil in Iran and Venezuela. Saudi Arabia acknowledged the call took place, but mentioned no production targets.

Trump wrote on Twitter that he had asked the king in a phone call to boost oil production “to make up the difference…Prices to (sic) high! He has agreed!”

A little over an hour later, the state-run Saudi Press Agency reported on the call, but offered few details.

“During the call, the two leaders stressed the need to make efforts to maintain the stability of oil markets and the growth of the global economy,” the statement said.

It added that there also was an understanding that oil-producing countries would need “to compensate for any potential shortage of supplies.” It did not elaborate.

Oil prices have edged higher as the Trump administration has pushed allies to end all purchases of oil from Iran following the U.S. pulling out of the nuclear deal between Tehran and world powers. Prices also have risen with ongoing unrest in Venezuela and fighting in Libya over control of that country’s oil infrastructure.

Last week, members of the Organization of the Petroleum Exporting Countries cartel led by Saudi Arabia and non-cartel members agreed to pump 1 million barrels more crude oil per day, a move that should help contain the recent rise in global energy prices. However, summer months in the U.S. usually lead to increased demand for oil, pushing up the price of gasoline in a midterm election year. A gallon of regular gasoline sold on average in the U.S. for $2.85, up from $2.23 a gallon last year, according to AAA.

If Trump’s comments are accurate, oil analyst Phil Flynn said it could immediately knock $2 or $3 off a barrel of oil. But he said it’s unlikely that decrease could sustain itself as demand spikes, leading prices to rise by wintertime.

“We’ll need more oil down the road and there’ll be nowhere to get it,” said Flynn, of the Price Futures Group. “This leaves the world in kind of a vulnerable state.”

Trump is trying to exert maximum pressure on Iran while at the same time not upsetting potential U.S. midterm voters with higher gas prices, said Antoine Halff, a Columbia University researcher and former chief oil analyst for the International Energy Agency.

“The Trump support base is probably the part of the U.S. electorate that will be the most sensitive to an increase in U.S. gasoline prices,” Halff said.

Trump’s comments came Saturday as global financial markets were closed. Brent crude stood at $79.42 a barrel, while U.S. benchmark crude was at $74.15.

Saudi Arabia currently produces some 10 million barrels of crude oil a day. Its record is 10.72 million barrels a day. Trump’s tweet offered no timeframe for the additional 2 million barrels — whether that meant per day or per month.

However, Saudi Aramco CEO Amin Nasser told journalists in India on Monday that the state oil company has spare capacity of 2 million barrels of oil a day. That was after Saudi Energy Minister Khalid al-Falih said the kingdom would honor the OPEC decision to stick to a 1-million-barrel increase.

“Saudi Arabia obviously can deliver as much as the market would need, but we’re going to be respectful of the 1-million-barrel cap — and at the same time be respectful of allocating some of that to countries that deliver it,” al-Falih said then.

The Trump administration has been counting on Saudi Arabia and other OPEC members to supply enough oil to offset the lost Iranian exports and prevent oil prices from rising sharply. But broadcasting its requests on Twitter with a number that stretches credibility opens a new chapter in U.S.-Saudi relations, Halff said.

“Saudis are used to U.S. requests for oil,” Halff said. “They’re not used to this kind of public messaging. I think the difficulty for them is to distinguish what is a real ask from what is public posturing.”

The administration has threatened close allies such as South Korea with sanctions if they don’t cut off Iranian imports by early November. South Korea accounted for 14 percent of Iran’s oil exports last year, according to the U.S. Energy Department.

China is the largest importer of Iranian oil with 24 percent, followed by India with 18 percent. Turkey stood at 9 percent and Italy at 7 percent.

The State Department has said it expects the “vast majority” of countries will comply with the U.S. request.
…

Editor’s note: A look at the veracity of claims by political figures

President Donald Trump has elevated his tax cuts to an act of biblical proportions, misleadingly claiming at a White House speech Friday that they triggered an “economic miracle.”

Not quite.

Also Friday, the president’s top economics aide, Larry Kudlow, appeared on the Fox Business Network to address one of the major problems with the tax cuts — that they’ll heap more than $1 trillion onto the national debt. Kudlow falsely countered that the budget deficit was falling because of growth generated by the tax cuts. The deficit is actually rising.

A look at the statements and the fact:

TRUMP: “Six months ago, we unleashed an economic miracle by signing the biggest tax cuts and reforms … the biggest tax cuts in American history.”

THE FACTS: The president is exaggerating, if not being outright deceptive.

Rather than achieving a miracle, his tax cuts have helped stoke additional growth in an economic expansion that was already approaching its 10th year. The additional growth is largely fueled by government borrowing, as the federal deficit rises because of the tax cut. The pace of growth is expected to taper off after next year, according to the Congressional Budget Office, the Federal Reserve and outside analysts.

And while the $1.5 trillion worth of tax reductions over the next decade are substantial, they’re far from the largest in U.S. history as a share of the overall economy. The Trump tax cut ranks behind Ronald Reagan’s in the early 1980s, post-World War II tax cuts and at least several more, according to the Committee for a Responsible Federal Budget, which advocates for deficit reduction.

Trump proudly went through a list of economic achievements that build on the progress begun under former President Barack Obama. The 3.8 percent unemployment rate and the historically low level of requests for jobless aid are both the result of a steady and gradual recovery from the worst economic meltdown since 1929.

Several hundred companies responded to the tax cuts by paying workers bonuses or hiking hourly wages, but any significant income growth has yet to surface in the overall economy.

The tax cuts have added on average $17 a month to people’s incomes, according to an analysis by Ernie Tedeschi, head of fiscal policy analysis at the investment firm Evercore ISI and a former Treasury Department economist. The analysis is based off consumer spending, income and inflation data released Friday.

That $17 monthly gain is helpful, but it’s far from miraculous.

​KUDLOW: “As the economy gears up, more people working, better jobs and careers, those revenues come rolling in, and the deficit, which is one of the other criticisms, is coming down, and it’s coming down rapidly.”

THE FACTS: Nope.

Since the fiscal year started in October, Treasury Department reports show the federal government has recorded a $385.4 billion deficit, a 12 percent jump from the same period in the previous year.

The Congressional Budget Office was even more blunt in a long-term assessment released Tuesday.

It estimates that the national debt — the sum of yearly deficits — will be $2.2 trillion higher in 2027 than it had previously forecast, largely a consequence of Trump’s 10 year, $1.5 trillion tax cut. The size of the debt could be even higher if provisions of the tax cut that are set to expire are, instead, renewed.
…

General Motors Co warned on Friday that higher tariffs on imported vehicles under consideration by the Trump administration could cost jobs and lead to a “a smaller GM” while isolating U.S. businesses from the global market.

The administration in May launched an investigation into whether imported vehicles pose a national security threat, and U.S. President Donald Trump has repeatedly threatened to impose a 20 percent vehicle import tariff.

The largest U.S. automaker said in comments filed with the U.S. Commerce Department that overly broad tariffs could “lead to a smaller GM, a reduced presence at home and abroad for this iconic American company, and risk less — not more — U.S. jobs.”

Higher tariffs could also hike vehicle prices and reduce sales, GM said.

​Less investment, fewer workers

Its comments echoed those from two major U.S. auto trade groups Wednesday, when they warned that tariffs of up to 25 percent on imported vehicles would cost hundreds of thousands of auto jobs, dramatically raise prices on vehicles and threaten industry spending on self-driving cars.

Even if automakers opted not to pass on higher costs “this could still lead to less investment, fewer jobs, and lower wages for our employees. The carry-on effect of less investment and a smaller workforce could delay breakthrough technologies,” GM said.

GM operates 47 U.S. manufacturing facilities and employs about 110,000 people in the United States. It buys tens of billions of dollars worth of parts from U.S. suppliers every year, and has invested more than $22 billion in U.S. manufacturing operations since 2009.

Still, 30 percent of the vehicles GM sold on the U.S. market in 2017 were manufactured abroad, according to the Michigan-based Center for Automotive Research. Eighty-six percent of those vehicles came from Canada and Mexico, while others came from Europe and China.

Detroit automakers Ford Motor Co and Fiat-Chrysler Automobiles NV also import many of the vehicles they sell in the United States.

“The overbroad and steep application of import tariffs on our trading partners risks isolating U.S. businesses like GM from the global market that helps to preserve and grow our strength here at home,” GM said.

GM shares closed down about 2.8 percent on Friday at $39.40. 

National security probe

Some aides have said that Trump is pursuing the national security probe to put pressure on Canada and Mexico to agree to concessions in talks to renegotiate the North American Free Trade Agreement.

Toyota Motor Corp filed separate comments opposing the tariffs on Friday saying they would “threaten U.S. manufacturing, jobs, exports, and economic prosperity.”

The company noted that Trump has repeatedly praised the Japanese automaker for investing in the United States, including a new $1.3 billion joint venture assembly plant in Alabama with Mazda.

“These investments reflect our confidence in the U.S. economy and in the power of the administration’s tax cuts,” Toyota said.

Toyota noted that international automakers assembling vehicles in the United States are based in countries including Japan, German and South Korea “that are America’s closest allies.”

The Commerce Department plans two days of public hearings next month, and Commerce Secretary Wilbur Ross said last week he aimed to wrap up the probe into whether imported vehicles represent a national security threat by late July or August.

“We have received approximately 2,500 comments already,” Ross said in a statement Friday, adding that he expected more before a midnight deadline.

“The purpose of the comment period and of the public hearing scheduled for July 19th and 20th is to make sure that all stakeholders’ views are heard, both pro and con. That will enable us to make our best informed recommendation to the president,” the statement said.
…

Just days before the Trump administration’s tariffs on Chinese steel and aluminum imports are set to go into effect, trade analysts are watching for ripple effects across the automotive, manufacturing and technology sectors. VOA’s Elizabeth Cherneff has more from Washington.
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U.S. President Donald Trump said he expects a second tax overhaul to be unveiled in October or a bit earlier, and he is considering cutting the corporate tax rate to 20 percent from 21 percent.

In an excerpt of a Fox Business Network interview to be broadcast Sunday, Trump said: “We’re doing a phase two. We’ll be doing it probably in October, maybe a little sooner than that.”

“One of the things we’re thinking about is bringing the 21 percent down to 20, and for the most part the rest of it would go right to the middle class,” he said.

In December, Trump signed the biggest overhaul of the U.S. tax code in 30 years, slashing the corporate tax rate to 21 percent from 35 percent and giving temporary tax relief to middle-class Americans.

The sweeping bill passed the Republican-controlled Congress over the opposition of Democrats, who decried it as a giveaway to the wealthy that would add $1.5 trillion to the $20 trillion national debt.

Republicans, hungry to revisit the tax issue ahead of a November midterm election showdown for control of Congress, are to unveil the outline of new tax legislation over the summer in the House of Representatives.

But more tax cuts are unlikely to succeed in the closely divided Senate, where Democrats and conservative fiscal hawks could block such a measure.

The nonpartisan Congressional Budget Office warned this week that more tax cuts would hasten the growth of an already rapidly rising federal debt.

The debt, which equals 78 percent of U.S. gross domestic product, is on track to eclipse the 106 percent record set just after World War II in 2034.

House Ways and Means Committee Chairman Kevin Brady, who presides over the chamber’s tax policy debate, said this week that new legislation would aim to make permanent tax cuts for individuals that are to expire in 2026. He expects a House vote in the autumn.

The Texas Republican made no mention of plans for an additional 1 percentage point cut in the U.S. corporate rate, which analysts say would reduce government revenues by an additional $100 billion over a decade.
…

Canada struck back at U.S. steel and aluminum tariffs on Friday, vowing to impose punitive measures on C$16.6 billion ($12.63 billion) of American goods and unveiling a C$2 billion aid package for affected industries

and workers.

Foreign Minister Chrystia Freeland told a news conference the tariffs would come into effect on July 1.
…

U.S consumers increased their spending just 0.2 percent in May, a disappointing result after two months of much stronger gains. The weaker reading could raise questions about the extent of economic growth overall in the current April-June quarter.

The Commerce Department says the tiny rise in spending last month followed much stronger increases of 0.6 percent in March and 0.5 percent in April. It was the poorest showing since spending had fallen 0.1 percent in February.

Consumer spending accounts for 70 percent of economic activity, and economists are counting on solid gains to propel economic growth after a slow start to the year.

In a more hopeful sign, incomes grew a solid 0.4 percent in May, supported by strong growth in wages and salaries.
…

After a sharp sell-off, China’s yuan and stock markets attempted a modest recovery Friday, yet investors were grappling with some of their worst losses in years as a bitter Sino-U.S. trade row threatened to ruffle the world’s second-biggest economy.

The yuan was set for its biggest monthly fall on record. Chinese stocks, on a downward spiral since late January, were also poised for their largest monthly slide since January 2016.

The downturn highlighted the anxiety among investors as Washington and Beijing showed no signs of backing down from their tariff dispute.

The worry is that an extended selloff in stocks and the yuan could spark a bout of capital outflows, putting further strain on the economy and complicating policy making as authorities put up defenses against the trade battle with the United States.

Down 3 percent in month

The yuan has shed more than 3 percent of its value against the dollar in June, its biggest fall since the market exchange rate was unified in 1994. On Friday, it fell to its lowest since mid-November 2017, but pulled up to 6.6139 per dollar by 0600 GMT for a modest bounce of about 0.16 percent on the day.

Offshore, where the yuan trades more freely, the unit was up by about a quarter of a percent, at 6.6224 per dollar.

In equities, the benchmark CSI300 Index rebounded more than 2 percent, while the Shanghai Composite Index gained around 2 percent, though they were both down around 9 percent for the month. In Hong Kong, the benchmark Hang Seng Index was also up more than 1 percent.

Trump and trade

U.S. President Donald Trump has shaken the world trade order by seeking to renegotiate the terms of some of the United States’ trading relationships, in particular with China.

The U.S. is targeting $34 billion of Chinese goods for tariffs to take effect July 6, and has threatened tens of billions of dollars more for similar duties.

Chinese 10-year treasury futures for September delivery, the most traded contract, leapt 0.34 percent. A fixed income portfolio manager said the sharp rise was a result of central bank promises of “ample” liquidity.

“The central bank is expected to step up efforts to calm investors and slow the pace of the yuan depreciation that has sparked risk aversion across regional markets, including a possible reintroduction of the counter-cyclical factor,” Gao Qi, FX strategist at Scotiabank in Singapore, wrote in a note Friday.

He expected “strong resistance” at 6.70 yuan per dollar.

Hard-hit areas

Sectors and stocks that were exposed to the depreciating yuan have been hit hard this month.

Real estate was down 5.7 percent and poised for its fifth straight month of losses. The transport sector index, whose components include many leading airlines, tumbled 9.4 percent this month and was set for its steepest monthly drop since January 2016.

A trader at a regional bank in Shanghai who declined to be named said there had been some “filtering” of the midpoint fixing, which is set by the central bank each morning, in an apparent bid to keep the yuan from falling too sharply.

“It is too early to say whether the counter-cyclical factor has been revived. If market sentiment could recover by itself, there is no need to use the factor. Market still needs some time to digest,” the trader said.
…

Minnesota regulators on Thursday approved Enbridge Energy’s proposal to replace its aging Line 3 oil pipeline across the northern part of the state.

All five members of the Public Utilities Commission backed the project, though some cited heavy trepidation, and a narrow majority later approved the company’s preferred route despite opposition from American Indian tribes and climate change activists.

In discussion before the vote, several commissioners cited the deteriorating condition of the existing line , which was built in the 1960s, as a major factor in their decision.

“It’s irrefutable that that pipeline is an accident waiting to happen,” Commissioner Dan Lipschultz said ahead of the vote. “It feels like a gun to our head … All I can say is the gun is real and it’s loaded.”

Some pipeline opponents reacted angrily when it became clear commissioners would approve the project. Tania Aubid, a member of the Mille Lacs Band of Ojibwe, stood and shouted, “You have just declared war on the Ojibwe!” Brent Murcia, of the group Youth Climate Intervenors, added: “We will not let this stand.”

Opponents argue that the pipeline risks spills in pristine areas in northern Minnesota, including where American Indians harvest wild rice. Ojibwe Indians, or Anishinaabe, consider wild rice sacred and central to their culture.

Winona LaDuke, founder of Honor the Earth, said opponents would use every regulatory means possible to stop the project — and threatened mass protests if necessary.

“They have gotten their Standing Rock,” she said, referring to protests that drew thousands of people to neighboring North Dakota to rally against the Dakota Access pipeline. 

Others welcomed Thursday’s vote, including Bob Schoneberger, founder of Minnesotans for Line 3. He said Minnesota needs the line now “and will need it even more into the future.”

After commissioners agreed the pipeline upgrade was needed, the commission voted 3-2 in favor of Enbridge’s preferred route, which departs from the existing pipeline to largely avoid two American Indian reservations currently crossed.

The approved route does clip a portion of the Fond du Lac Band of Chippewa’s land, and commissioners said they would adjust the route if the Fond du Lac don’t agree. Tribal leaders had reluctantly backed a route that went much farther south as the least objectionable option.

After the commission’s work is formalized in the next few weeks, opponents may file motions asking it to reconsider. After that, they can appeal the decision to the state Court of Appeals. 

Several commissioners said the overall issue posed a difficult decision. Chairwoman Nancy Lange choked up and took off her glasses to wipe her eyes as she described her reasoning for approving the project. Another commissioner, Katie Sieben, said it was “so tough because there is no good outcome.”

The pipeline currently runs from Alberta, Canada, across North Dakota and Minnesota to Enbridge’s terminal in Superior, Wisconsin. Enbridge has said it needs to replace the pipeline because it’s increasingly subject to corrosion and cracking, and that it would continue to run Line 3 if regulators rejected its proposal.

Much of the debate has focused on whether Minnesota and Midwest refineries need the extra oil. Enbridge currently runs Line 3 at about half its original capacity of 760,000 barrels per day for safety reasons, and currently uses it only to carry light crude. 

The project’s opponents, including the Minnesota Department of Commerce, have argued that the refineries don’t need it because demand for oil and petroleum products will fall in the coming years as people switch to electric cars and renewable energy sources. Opposition groups also argue that much of the additional oil would eventually flow to overseas buyers.

Enbridge and its customers strongly dispute the lack of need in the region. They said Line 3’s reduced capacity is already forcing the company to severely ration space on its pipeline network, and that failure to restore its capacity would force oil shippers to rely more on trains and trucks, which are more expensive and less safe. Business and labor groups support the proposal for the jobs and economic stimulus. 

The Public Utilities Commission’s decision likely won’t be the final word in a long, contentious process that has included numerous public hearings and the filings of thousands of pages of documents since 2015. Lange said earlier this year that the dispute was likely to end up in court, regardless of what the commission decides.

Opponents have threatened a repeat of the protests on the Standing Rock Reservation against the Dakota Access pipeline, in which Enbridge owns a stake. Those protests in 2016 and 2017 resulted in sometimes violent skirmishes with law enforcement and more than 700 arrests. 

Similar concerns over the role of tar sands oil in climate change, indigenous rights and the risk of spills has fueled opposition to other pipelines out of Alberta’s oil sands region. Opponents of TransCanada’s Keystone XL pipeline to Nebraska are still fighting that project in court. The Canadian government agreed last month to buy Kinder Morgan’s Trans Mountain pipeline across Canadian soil to the Pacific Coast for $4.5 billion Canadian (US$3.4 billion) to ensure completion of the company’s plan to triple the line’s capacity. 

Enbridge has already replaced the short segment of Line 3 in Wisconsin and put it into service. Construction is underway on the short segment that crosses northeastern North Dakota and on the longer section from Alberta to the U.S. border, and Enbridge plans to continue that work. Enbridge has estimated the overall cost of the project at $7.5 billion, including $2.6 billion for the U.S. segment.

 
…

A U.S. delegation traveled to Kenya on Thursday to attend the inaugural economic summit of the American Chamber of Commerce, Kenya.

About 500 delegates, including Kenyan President Uhuru Kenyatta and Gilbert Kaplan, U.S. undersecretary of commerce for international trade, other high-ranking government officials from both nations and representatives from nearly 30 major U.S. corporations, gathered at the summit, which was aimed at creating partnerships between the two nations’ public and private sectors in order to foster economic growth. 

The Kenyan agenda was centered on advancing Kenyatta’s “Big Four” priorities — universal health care, manufacturing, food security and affordable housing — that he set out after his re-election to a second term last year.

American companies in attendance were looking for opportunities to expand and to increase trade and investment in Africa.

Kaplan told VOA that increasing business and economic development in Africa would benefit many Americans, which aligns with the promises of President Donald Trump’s “Make America Great Again” agenda. 

“If we can export more and do more transactions here, do more investment here, that’s going to be incredibly helpful for the United States, for the people back home, because we’ll be making profitable ventures, and that will naturally help,” he said.

But the U.S. delegation also had a strong message for Kenya: Real, meaningful economic growth can’t happen unless Kenya commits to fighting corruption.

‘It’s got to stop’

“Corruption is undermining Kenya’s future,” said Robert Godec, U.S. ambassador to Kenya. “It’s clearly a major problem for the country. We welcome President Kenyatta’s commitment and the push recently to address this problem. Corruption is theft from the people, and it’s got to stop.”

In his speech to the delegation, Kenyatta pledged to “fight this animal called corruption and ensure that it is a beast that shall never infect or inflict future generations” of Kenyans. 

Kaplan told VOA that the U.S. government was providing support and training to the Kenyan government to help tackle corruption.

“We’ve dealt with that — the Foreign Corrupt Practices Act, rule of law and international standards,” he said. “I think we can convince Kenya that following those rules is ultimately to their benefit because it brings more businessmen and women into the system and being able to be successful.” 

Part of the objective of the Foreign Corrupt Practices Act is to make it illegal for companies and their supervisors to influence foreign officials with personal payments or rewards.

C.D. Glin, president and chief executive of the U.S. African Development Foundation, told VOA that the U.S. government’s and private sector’s support of businesses in Africa that had ramped up under the previous administration was being continued by Trump.

For instance, the President’s Advisory Council for Doing Business in Africa, begun under the Barack Obama administration and still in force, “really is looking at Africa from a business standpoint and from an opportunity standpoint so that Africans can benefit from U.S. support, but also can support the U.S.,” Glin said.

Major boost

Nicholas Nesbitt, chairman of the Kenya Private Sector Alliance, said the increased U.S. private sector investment had been hugely beneficial for the Kenyan economy.

“We see a lot more tourism coming to Kenya, a lot more trade and a lot more business,” he said. “We’re very excited to see the numbers of American companies — small, midsize and even large corporations — looking at Kenya as a destination. It’s also a gateway to east Africa, where there are 200 million potential consumers. So, the investments, the energy, the excitement is absolutely tremendous today at this summit between American and Kenyan business.”

Six commercial deals between Kenyan and American companies were signed at the summit. Maxwell Okello, chief executive of the American Chamber of Commerce, Kenya, called that a sign that significant economic change would be driven by private sector innovation.

“I think at the end of the day, with what we’re hearing today here, it’s really down to what the private sector wants to do from a commercial engagement,” he said. “And I believe conversations such as this is really where you spark that interest, where you create those linkages and the sort of engagement that you need. And the opportunities are there for anyone. They’re obvious.

“So, I think that various policies aside, from a commercial business engagement perspective, the sky is wide open.” 
…

Importers of Iranian oil are facing pressure from the United States to find another energy source or be hit with sanctions.

The Trump administration is threatening other countries, including close allies such as South Korea, with the sanctions if they don’t cut off Iranian imports by early November, essentially erecting a global blockade around the world’s sixth-biggest petroleum producer.

South Korea accounted for 14 percent of Iran’s oil exports last year, according to the U.S. Energy Department. China is the largest importer of Iranian oil with 24 percent, followed by India with 18 percent. Turkey stood at 9 percent, and Italy at 7 percent.

A State Department official told reporters this week that the “vast majority” of countries will comply with the U.S. request. A group from the State Department and the National Security Council is delivering the president’s message in Europe. The official added that the group had not yet visited China or India.

President Donald Trump announced in May that he would pull the United States out of a 2015 agreement over Iran’s nuclear program, and would re-impose sanctions on Tehran. Previously, the administration said only that other countries should make a “significant reduction” in imports of Iranian crude to avoid U.S. sanctions.

European allies will reluctantly go along to avoid sanctions on their companies that do business in the U.S., said Jim Krane, an energy and geopolitics expert at Rice University. However, China, India and Turkey might be less likely to fully cut off Iranian imports, he said.

Antoine Halff, a researcher at Columbia University and former chief oil analyst for the International Energy Agency, said it’s not unusual for the U.S. government to seek cooperation from other importers of Iranian oil — President Barack Obama’s administration did it during a previous round of sanctions.

“The difference is that there was broad international support for the sanctions then,” while the move to restore sanctions now over Iran’s nuclear program “is a unilateral decision from the United States alone,” Halff said.

The Trump administration is counting on Saudi Arabia and other OPEC members to supply enough oil to offset the lost Iranian exports and prevent oil prices from rising sharply.

The State Department official, who spoke on condition of anonymity, said the U.S. will be talking in a week or so “with our Middle Eastern partners to ensure that the global supply of oil is not adversely affected by these sanctions.”

Members of the Organization of the Petroleum Exporting Countries agreed over the weekend to boost oil production by about 600,000 barrels a day. Iran exported about 1.9 million barrels a day during the first quarter of this year, according to OPEC figures. It is the world’s seventh largest oil exporter.

“It would not be a heavy lift for OPEC to replace Iran’s contribution to world oil markets — Saudi Arabia could probably do it on its own,” Krane said. “Saudi spare capacity protects the U.S. motorist from U.S. foreign policy.”
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President Donald Trump was highlighting his economic policies Thursday by taking part in the ceremonial ground-breaking for a $10 billion Foxconn factory complex that may bring thousands of jobs to a state he barely carried in the 2016 presidential election.

But Trump’s celebration comes amid less-rosy economic news, with Harley-Davidson’s announcement it’s moving some motorcycle production overseas to avoid European Union tariffs that are a product of Trump’s escalating trade dispute with long-standing U.S. allies.

The president was irked by the Milwaukee-based company’s announcement this week and tweeted about it for three straight days, writing that any shift in production “will be the beginning of the end” for the iconic American manufacturer and even threatening retaliatory taxes.

Trump’s presence in Wisconsin was the subject of protests both in Milwaukee, where he spent a rare weeknight away from the White House, and in Mount Pleasant, where final preparations were under way for the ground-breaking.

Chants of “Hey, hey, Ho, ho. Donald Trump has got to go” were heard near the Pfister Hotel, where Trump overnighted and attended a pair of closed-door campaign events before heading to the groundbreaking and tour of an existing Foxconn facility. Gov. Scott Walker and House Speaker Paul Ryan, R-Wis., were among those joining the president at the fundraisers. 

About 50 people walked from a downtown park to as close as they could get to the roped-off hotel, hoping Trump hears their calls to reunite migrant families separated at the U.S.-Mexico border after the president decide to prosecute everyone trying to enter the U.S. illegally.

As the president hobnobbed with supporters, his wife, Melania, was making her second trip in a week to the southern border to visit detention centers housing migrant children. She toured a Texas center last Thursday.

Christine Neumann-Ortiz, executive director of Voces de la Frontera, an immigrant rights organization, said the family separation issue is not unique to border communities. She said it’s also happening in the U.S. interior where deportations have increased.

“The scale of human rights violations that are being inflicted on children and families by the current administration should shake us to our core,” she said.

Protesters were also gathering near the Foxconn Technology Group campus in Mount Pleasant, about 30 miles south of Milwaukee.

Nearly 40 groups representing students, environmentalists, civil rights advocates, teachers, union workers and others have organized an event featuring dozens of speakers, a marching band, singers and musicians who plan to play ominous “Star Wars” music.

Foxconn is the world’s largest electronics contract manufacturer and assembles Apple iPhones and other products for tech companies. Based in Taiwan, it chose Wisconsin after being prodded by Trump and others, including Ryan, whose district will include the plant.

The project could employ up to 13,000 people, though opponents say it is costing Wisconsin taxpayers too much.

The ceremonial groundbreaking was supposed to be evidence that the manufacturing revival fueled by Trump’s “America First” policy is well underway. But Harley-Davidson’s announcement, spurred by the trans-Atlantic tariff fight, appears to have turned that on its head.

Walker is counting on a strong economy as part of his case for re-election in November. Wisconsin’s unemployment is at record-low levels and Walker argues that the Foxconn project, the largest economic development deal in state history, shows the state is on the right track.

When the deal, reached with assistance from the White House, was signed last year, Walker said critics could “suck lemons” and “all of us in the state should be smiling, Republican and Democrat, doesn’t matter.”

A year later, opinion polls show Wisconsin voters are split on the project and the state of the economy.

Trump carried Wisconsin by less than 1 point — just under 23,000 votes. He’s underwater in popularity, with only 44 percent of respondents in last week’s Marquette University Law School poll approving of the job he’s doing, while 50 percent disapproved.

Republicans were mostly unified in support of Foxconn, saying it is a once-a-generation opportunity to transform the state’s economy. But most Democrats — including all eight of those running against Walker — are against it, arguing the potential $4.5 billion in taxpayer subsidies was too rich. If paid out — they’re tied to jobs and investment benchmarks — the incentives would be the most paid to a foreign company in U.S. history.

Should Foxconn employ 13,000 workers as envisioned, it would be the largest private-sector employer in Wisconsin.

“Foxconn’s state-of-the-art products will be made in the U.S.A. — proudly in the state of Wisconsin!” Walker tweeted Tuesday, as he tried to shift the focus away from Harley-Davidson.

 
…

China defended its trade practices Thursday as being beneficial to the world as it tries to ease pressure from the United States and Europe to abandon what they consider to be Beijing’s protectionist policies.

China’s rapid economic growth “has brought great opportunities to trading partners all over the world,” Vice Commerce Minister Wang Shouwen said at a Beijing news conference.

Wang unveiled a report highlighting reforms China has taken since joining the World Trade Organization in 2001.He said Beijing has “carried out every promise” since joining the WTO.

Wang’s defense of China’s business practices come amid threats of a trade war with the United States and arguments by Europe and Washington that China limits access to emerging industries and steals or forces other countries to hand over technology.

Trump’s threat of tariff increases on Chinese goods worth up to $450 billion reflects fears that China’s actions are a threat to America’s technological leadership.Germany and other countries have complained that Beijing prohibits purchases of Chinese assets while Chinese companies engage in a worldwide spending spree.

The dispute with Trump has allowed China, which has the world’s second largest economy, to position itself as a defender of free trade.When asked about possible U.S. plans to limit Chinese investment in its technology sectors, Wang said, “We hope countries concerned can do the right thing and adopt policies that support free trade and investment.”

The U.S. and other trading partners maintain China’s emergence in the smartphone, solar and other technology sectors means it should no longer be afforded protections it was granted as a developing country when it joined the WTO.

China has offered to cut its multi-billion trade surplus with the United States, but has refused to abolish a strategy that its Communist leaders believe is a path to increased global influence and prosperity.

China and the European Union announced this week they will form a group to update WTO rules to keep pace with global economic developments.
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Jared Kushner’s family company is suing a New Jersey city, alleging it forced the delay of a major twin-tower project due to “political animus” toward President Donald Trump.

The federal lawsuit filed Wednesday by the Kushner Cos. claims Jersey City and the city’s redevelopment agency “put politics over principle” when they broke a contract with developers over the planned One Journal Square project, according to a report in the Jersey Journal.

Trump is a Republican. Jersey City Mayor Steven Fulop, a defendant in the suit, is a Democrat.

The Kushner Cos. previously threatened a lawsuit in April after the Jersey City Redevelopment Agency said developers were in default because they missed a deadline to begin construction on the project.

Fulop dismissed the lawsuit, saying it amounts to “hearsay nonsense.” He said “it’s not like the Kushners have a great deal of credibility in anything they say” and that “they will do anything to manipulate a situation.”

The lawsuit is seeking to stop the city from ending the project’s contract and declare the notice of default null and void. It calls the default threat a “transparent pretext to enhance Fulop’s status among the electorate of the city.”

Joseph Fiorenzo, the company’s lawyer, said the “outrageous conduct” of city officials “strikes at the very heart of our economic system which has, as its foundation, the freedom of people to organize their affairs by entering into contracts. This is the glue that holds our economic system together.”

The suit also names the city and the redevelopment agency as defendants.

 
…

Enslaved on a Thai fishing vessel for 11 years, Tun Lin saw his fellow workers lose their minds one after another, with one fisherman jumping into the sea to end his

life.

Some would start murmuring or laughing to themselves as they worked day and night in Indonesian waters on the cramped boat, often surviving on fish they caught and drinking water leaking from an onboard freezer.

“It was like a floating prison – actually, worse than prison,” the Burmese fisherman, who was sold into slavery, told the Thomson Reuters Foundation in Samut Sakhon, a Thai fishing hub some 40 km (25 miles) southwest of the capital Bangkok.

The 36-year-old, who was rescued in 2015 after losing four fingers and being stranded on a remote island for years without pay, is now lobbying for fishermen’s rights with the Thai and Migrant Fishers Union Group (TMFG).

Under growing consumer pressure, Thailand has introduced a raft of modern technologies since 2015 – from satellites to optical scanning and electronic payment services – to crack down on abuses in its multibillion-dollar fishing industry.

It is one of a growing number of countries using innovation to deal with modern slavery, from mobile apps in India to blockchain in Moldova, but experts warn against over-reliance on tech as a silver bullet without stronger workers’ rights.

“Technology can be a double-edged sword,” said Patima Tungpuchayakul, co-founder of the Labor Rights Promotion Network Foundation, a Thai advocacy group. “It has become an excuse the government is using to justify they have done something, but in practice they don’t use it to solve the problem.”

More than half the estimated 600,000 industry workers are migrants, often from poor neighboring countries such as Cambodia and Myanmar, United Nations (U.N.) data shows.

Tracking Devices

After the European Union threatened to ban fish exports from Thailand, and the U.S. State Department said it was failing to tackle human trafficking, the Southeast Asian country toughened up its laws and increased fines for violations.

It banned the use of workers aged below 18 and ordered fishermen to be given contracts and be paid through electronic bank transfers.

Authorities ordered Thai vessels operating outside national waters to have satellite communications for workers to contact their families or report problems at sea, plus tracking devices to spot illegal fishing.

“We are serious in law enforcement regarding human trafficking and illegal labor cases,” said Weerachon Sukhontapatipak, a Thai government spokesman. “There might not be abrupt change … it will take time.”

Thailand is also rolling out an ambitious plan, using iris, facial and fingerprint scans to record fishermen’s identities to make sure they are on the boats they are registered with and help inspectors spot trafficking victims.

Rights groups meanwhile have tried to use satellites to pinpoint the location of ships that remain at sea for long periods, potentially indicating enslavement.

But human trafficking expert Benjamin Smith said using satellites to tackle slavery at sea was not easy unless there is a lead on where to track in the vast ocean.

“I think people underestimate the size of the ocean and the ability to pinpoint where something as small as a boat is,” Smith from the U.N. Office on Drugs and Crime (UNODC) said. “If you have good information, intelligence, then satellite images can be good … It has to be a small part of a much bigger effort.”

Smith also highlighted difficulties prosecuting cross-border trafficking cases and maritime police funding shortages, adding that continued consumer pressure on firms to clean up their supply chains could be a potent force to help end slavery.

“That’s probably the best way you can start,” he said.

Good News

Fishermen remain at risk of forced labor and the wages of some continue to be withheld, the International Labor Organization (ILO) said in March.

To combat slavery, firms must improve workers’ lives, rather than cutting labor costs and recruiting informally to meet demand for cheaper goods, experts say.

“Smaller owners are getting squeezed, and still rely on brokers and agents, who dupe workers and keep them ignorant of their rights and conditions on the boat,” said Sunai Phasuk, a researcher with lobby group Human Rights Watch in Bangkok.

Workers are set to become more vocal with the May launch of the Fishers’ Rights Network, which aims to combat abuses, backed by the world’s largest canned tuna producer, Thai Union, and the International Transport Workers’ Federation (ITF).

“Without enforceable rights at the workplace and the strength that comes from being represented by a union, labor rights violations and the mistreatment will continue,” said Johnny Hansen, chairman of ITF’s fisheries section.

Thailand’s ratification this month of the ILO protocol on forced labor also offers hope. It is the first Asian country to promise to combat all forms of the crime, including trafficking, and to protect and compensate victims.

“We have … committed to changing the law to allow workers to form unions, so we can work together to solve the problems,” said Thanaporn Sriyakul, an advisor to the deputy prime minister. “But the process is long, and it will take time.”

Thailand has also pledged to ratify two other conventions on collective bargaining and the right to organize, which campaigners say would better protect seafood workers.

This would be good news for Lin’s fishermen’s group, which has helped rescue more than 60 people since 2015, but has no legal status as Thai law does not permit fisher unions, leading rights advocates to use other terms, like workers’ groups.

“There are still lots of victims, and I want to help them,” Lin said. “As fishermen who have suffered in a similar manner, we understand each other’s needs and are able to help better.”
…

U.S. stocks rose on Tuesday as gains in technology, consumer discretionary stocks and General Electric helped Wall Street recover from a sharp sell-off a day earlier on spiraling global trade tensions.

GE rose 8.2 percent, on track for its biggest one-day gain in over three years, after the company said it would spin off its healthcare business and divest its stake in oil-services company Baker Hughes.

Technology stocks rose, after plunging on Monday after reports of possible restrictions on foreign investment in U.S. technology firms. Apple was up 1.8 percent, Amazon rose 1.9 percent and Netflix gained 4.6 percent.

“We’re still in a tug-of-war between daily twists and turns of a potential trade war and the reality of a strong underlying U.S. economy,” Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management Co said.

Mnuchin turns to Twitter

The benchmark S&P 500 index on Monday saw its worst day in more than two months, dropping 1.37 percent after conflicting messages from Trump administration officials on the proposed foreign investment restrictions.

After initial reports that only Chinese investments would be curbed, U.S. Treasury Secretary Steven Mnuchin said on Twitter that restrictions would apply “to all countries that are trying to steal our technology.”

White House trade and manufacturing adviser Peter Navarro later said only China would be targeted.

Harley-Davidson fell 0.8 percent after U.S. President Donald Trump threatened the company with higher taxes, a day after the company said it would move production of motorcycles, shipped to the EU, to its international facilities.

At 12:57 p.m. ET the Dow Jones Industrial Average was up 81.61 points, or 0.34 percent, at 24,334.41, the S&P 500 was up 10.83 points, or 0.40 percent, at 2,727.90 and the Nasdaq Composite was up 46.43 points, or 0.62 percent, at 7,578.44.

Oil crude prices rise

Seven of the 11 major S&P sectors were higher, led by a 1.27 percent gain in the energy index.

Oil prices jumped over 2 percent as Washington pushed allies to halt imports of Iranian crude.

U.S. homebuilder Lennar jumped about 6.3 percent as strong housing demand helped it report better-than-expected quarterly results.

Advancing issues outnumbered decliners for a 1.89-to-1 ratio on the NYSE and for a 1.67-to-1 ratio on the Nasdaq.

The S&P index recorded five new 52-week highs and nine new lows, while the Nasdaq recorded 43 new highs and 44 new lows.
…

U.S. President Donald Trump said on Tuesday the government was completing a study about increasing import tariffs on cars from the European Union and suggested he would take action soon.

“We are finishing our study of Tariffs on cars from the E.U. in that they have long taken advantage of the U.S. in the form of Trade Barriers and Tariffs. In the end it will all even out – and it won’t take very long!” Trump tweeted.

On Friday Trump threatened to impose a 20 percent tariff on all imports of EU-assembled cars, a month after his administration launched an investigation into whether auto imports posed a national security threat.

On Saturday, a senior European Commission official said the EU would respond to any U.S. move to raise tariffs on cars made in the bloc.

The U.S. Commerce Department has a deadline of February 2019 to investigate whether imports of automobiles and auto parts pose a risk to U.S. national security.

U.S. Commerce Secretary Wilbur Ross said last Thursday the department aimed to wrap up the probe by late July or August.

Trump has repeatedly singled out German auto imports to the United States for criticism.

Trump told carmakers at a meeting in the White House on May 11 that he was planning to impose tariffs of 20 percent or 25 percent on some imported vehicles and sharply criticized Germany’s automotive trade surplus with the United States.

The United States currently imposes a 2.5 percent tariff on imported passenger cars from the EU and a 25 percent tariff on imported pickup trucks. The EU imposes a 10 percent tariff on imported U.S. cars.

 
…

After beer, the summer barbecue may now be under threat in northern Europe.

A shortage of carbon dioxide that has already drawn warnings from beer makers about potential production problems is also hitting food processing companies. Scotland’s biggest pork producer said Tuesday it would run out of the gas in a week.

Slaughterhouses use carbon dioxide to stun animals before slaughter, and also use it in packaging to increase shelf-life in stores.

The British government prioritizes carbon dioxide for use in hospitals and fire-extinguishers, so companies that use the gas for manufacturing — to make fizzy drinks or process meat, for example — are being supplied with less.

Industrial carbon dioxide is obtained as a byproduct in the production of fertilizers. That means that companies that use the gas, like breweries and slaughterhouses, have no say on how much is produced.

Production is usually lower in the summer because of the hot weather, but a string of problems across the sector have meant that fertilizer makers have shut down more of their plants than usual. In addition, overall production of carbon dioxide is under pressure as the market for the fertilizer ammonium nitrate has weakened, said Nick Allen, head of the British Meat Processors Association.

“If it’s not making much money, you basically don’t carry on producing it. Things are getting tight,” he said.

Allen said that if carbon dioxide is in short supply, “it might well affect the price of meat.” Many major suppliers “will have to make very serious decisions about their levels of production.”

Among smaller businesses, the shortage could hurt farmers. Alex Gordon, the manager of Maidland’s Farm in Scotland, said that the shortage would be detrimental to his business. As slaughterhouses set prices, Gordon worries the amount of money given to farmers “would hit the ground.”

“Farmers could make less money,” he said.

Zoe Davies, CEO of Britain’s National Pig Association, says the shortages could last weeks for some companies but is hopeful that the pig industry will not suffer lasting damage. Davies said no work is being canceled so far, with major farms moving their pigs to other slaughterhouses.

“I don’t think the customer would see any difference,” said Davies.

Even though meat manufacturers predict that carbon dioxide supplies will return to normal levels within the next few weeks, Davies sees the issue as a lesson for the industry: “We have to work out how on earth we got into this situation. Nobody ever imagined a situation where they would lose carbon dioxide completely.”
…