YCLOAK

U.S. homebuilders are feeling more optimistic than they have in months, looking past a recent slowdown in new home sales and the risk of rising labor and materials costs following hurricanes Harvey and Irma.

The National Association of Home Builders/Wells Fargo builder sentiment index released Tuesday rose four points to 68 this month. That’s the highest reading since May.

Readings above 50 indicate more builders see sales conditions as good rather than poor. The index has remained above 60 since September of 2016.

According to the latest survey by FactSet, the index easily exceeded expectations for a reading of 64 among industry analysts.

Readings gauging builders’ view of single-family home sales now and over the next six months rose from September. A measure of traffic by prospective buyers also rose.

The deadly hurricanes that swept into Texas, Louisiana and Florida raised concerns among builders that that their new-home projects could be delayed and face rising construction and materials costs as the focus turned to rebuilding properties that were flooded or damaged by the fierce winds and rainstorms. Homebuilders were grappling with a shortage of skilled construction labor before the hurricanes hit.

Those concerns remain, but builders appear to be drawing encouragement from the thin supply of homes on the market, which has helped lift sales of new homes ahead of last year’s pace.

“It is encouraging to see builder confidence return to the high 60s levels we saw in the spring and summer,” said Robert Dietz, the NAHB’s chief economist. “With a tight inventory of existing homes and promising growth in household formation, we can expect the new home market continue to strengthen at a modest rate in the months ahead.”

A shortage of homes for sale coupled with rising prices has turned affordability into a challenge for many would-be buyers.

Sales of new U.S. homes slid 3.4 percent in August to a seasonally adjusted annual rate of 560,000. It was the second straight monthly decline, though sales are running 7.5 percent higher year-to-date than in 2016, thanks to solid sales gains earlier this year. New-home sales figures for September are due out next week.

This month’s builder index was based on 323 respondents.

A measure of current sales conditions for single-family homes rose five points to 75, while an outlook for sales over the next six months climbed five points to 78. Builders’ view of traffic by prospective buyers increased one point to 48.

 
…

U.S. President Donald Trump’s net worth declined by some $600 million to $3.1 billion in the past year, according to Forbes magazine.

The biggest contributing factor to Trump’s declining fortune was his real estate holdings, much of which is in New York City. Several of his Manhattan properties have declined in value, reducing his fortune in this sector by nearly $400 million.

Some of Trump’s golf properties overseas and in the United States also have declined in value, the apparent result of potential guests being offended by Trump’s politics and bluster, Forbes reported.

The presidential campaign also contributed to a decline in Trump’s net worth. His cash holdings were reduced to about $100 million since last year after he spent $66 million on his campaign.

The reduction in Trump’s cash holdings also was the result of a $25 million payment Trump made to settle a lawsuit over Trump University.

Forbes said it calculated Trump’s net worth “after months of digging through financial disclosures and public property records and conducting dozens of interviews.”

Forbes now ranks Trump as the 248th richest person in the U.S., down from 156 in 2016.

Microsoft co-founder Bill Gates topped the list of wealthiest Americans for the 24th consecutive year with a net worth of $89 billion. Amazon’s Jeff Bezos came in number two with a net worth of $81.5 billion.
…

For the last year, the deli that Egyptian-American Hatem El-Gamasy owns in Queens, New York has been the backdrop to on-air discussions on U.S. foreign policy and Middle Eastern affairs that are broadcast in Egypt. But when Egyptian broadcasters caught wind of his daytime job, the calls suddenly stopped. But VOA’s Ramon Taylor reports that El-Gamasy’s dream to achieve journalistic success carries on.
…

The church was empty, except for the piano too heavy for one man to move. It had been 21 days since the greatest storm Wayne Christopher had ever seen dumped a year’s worth of rain on his town, drowning this church where he was baptized, met his high school sweetheart and later married her.

 

He had piled the ruined pews out on the curb, next to water-logged hymnals and molding Sunday school lesson plans and chunks of drywall that used to be a mural of Noah’s Ark. Now he tilted his head up to take in the mountain of rubble, and Christopher, an evangelical Christian and a conservative Republican, considered what caused this destruction: that the violent act of nature had been made worse by acts of man.

 

“I think the Lord put us over the care of his creation, and when we pollute like we do, destroy the land, there’s consequences to that,” he said. “It might not catch up with us just right now, but it’s gonna catch up. Like a wound that needs to be healed.”

 

Jefferson County, Texas, is among the low-lying coastal areas of America that could lose the most as the ice caps melt and the seas warm and rise. At the same time, it is more economically dependent on the petroleum industry and its emissions-spewing refineries than any other place in the U.S. Residents seemed to choose between the two last November, abandoning a four-decade-old pattern of voting Democratic in presidential elections to support Donald Trump.

 

Then came Hurricane Harvey. Now some conservatives here are newly confronting some of the most polarizing questions in American political discourse: What role do humans play in global warming and the worsening of storms like Harvey? And what should they expect their leaders — including the climate-skeptic president they helped elect — to do about the problem now?

Answers are hard to come by in a place where refineries stand like cityscapes. Nearly 5,000 people work in the petroleum industry. Some have described the chemical stink in the air as “the smell of money” — it means paychecks, paid mortgages and meals.

 

Christopher, like most people in Jefferson County, believed that global warming was real before the storm hit. Post-Harvey, surrounded by debris stretching for block after block, he thinks the president’s outright rejection of the scientific consensus is no longer good enough.

 

But how do you help the climate without hurting those who depend on climate-polluting industries?

 

“It’s a Catch-22 kind of thing,” he said. “Do you want to build your economy, or do you want to save the world?”

 

___

 

“Steroids for storms” is how Andrew Dessler explains the role global warming plays in extreme weather. Climate change didn’t create Hurricane Harvey or Irma or Maria. But Dessler, a professor of atmospheric sciences at Texas A&M University, and most scientists agree that warming and rising seas likely amplify storms that form naturally, feeding more water and more intensity as they plow toward land.

 

“It will be 60 inches of rain this time, maybe 80 inches next time,” Dessler said of Harvey’s record-setting rainfall for any single storm in U.S. history.

As a private citizen and candidate, Trump often referred to climate change as a hoax, and since taking office he and his administration have worked aggressively to undo policies designed to mitigate the damage. He announced his intention to pull out of the Paris climate agreement, a global accord of 195 nations to reduce carbon emissions, and his administration has dismantled environmental regulations and erased climate change data from government websites. This month, his Environmental Protection Agency administrator promised to kill an effort to limit carbon emissions from coal-fired plants.

 

Anthony Leiserowitz, a Yale University researcher, traces the politicization of the climate to 1997, when then-Democratic Vice President Al Gore brokered a commitment on the world stage to reduce greenhouse gases. The political parties have cleaved further apart ever since, and climate change denial reached a fever pitch as the Tea Party remade the GOP during President Barack Obama’s first term.

 

Americans tend to view the issue through their already established red-versus-blue lens, Leiserowitz said. But while there are fractions on each extreme, the majority still fall somewhere along a scale in the middle.

 

A new Associated Press-NORC Center for Public Affairs Research poll finds that 63 percent of Americans think climate change is happening and that the government should address it, and that two-thirds of Americans disapprove of the way Trump is handling the issue. Most Americans also think weather disasters are getting more severe, and believe global warming is a factor.

 

As the downpour from Hurricane Harvey stretched into its second day, with no end in sight, Joe Evans watched from the window of his home in the Jefferson County seat of Beaumont, and an unexpected sense of guilt overcame him: “What have we been doing to the planet for all of these years?”

Evans, a Republican, once ran unsuccessfully for local office. He ignored climate change, as he thought Republicans were supposed to do, but Harvey’s deluge left him wondering why. When he was young, discussions of the ozone layer were uncontroversial; now they’re likely to end in pitched political debate.

 

“I think it’s one of those games that politicians play with us,” he said, “to once again make us choose a side.”

 

Evans voted for Trump, but he’s frustrated with what he describes as the “conservative echo chamber” that dismisses climate change instead of trying to find a way to apply conservative principles to simultaneously saving the Earth and the economy. Even today, some Republicans in the county complain about Gore and the hypocrisy they see in elite liberals who jet around the world, carbon emissions trailing behind them, to push climate policies on blue-collar workers trying to keep refinery jobs so they can feed their families.

 

Evans isn’t sure if the disastrous run of weather will cause climate change to become a bigger priority for residents here, or if as memories fade talk of this issue will, too.

 

“I haven’t put so much thought into it that I want to go mobilize a bunch of people and march on Washington,” he said. “But it made me think enough about it that I won’t actively take part in denying it. We can’t do that anymore.”

 

___

 

Most in Texas didn’t believe climate change existed when Katharine Hayhoe, a climate scientist at Texas Tech University, began evangelizing about the issue years ago. Now studies estimate that 69 percent of Texans believe that the climate is changing, and 52 percent believe that has been caused by human activity. Most resistance she hears now is not with the science itself but over proposed solutions that mean government intrusion and regulation.

Jefferson County’s refineries produce 10 percent of the gasoline in the United States, 20 percent of diesel and half of the fuel used to fly commercial planes, said County Judge Jeff Branick, a Democrat who voted for Trump and then switched his party affiliation to Republican, in part because of his disagreement with the Democratic Party’s climate policies.

 

Branick doesn’t deny that climate change exists, but he calls himself a cheerleader for the petroleum industry and believes environmental policies are “job killers.”

 

John Sterman, a professor at MIT Sloan School of Management, said addressing climate change will invariably lead to gradual job losses in the fossil fuels industry. But communities have lost a dominant industry before, and those able to diversify can prosper. Jefferson County could look to the renewable energy industry, with jobs that require many of the skills refinery workers have, he said. Texas already produces more wind power than any other state.

 

Angela Lopez’s husband works in a refinery, so she understands the worry of the economic cost of addressing global warming. But her county is nicknamed “cancer alley” for its high levels of disease that residents have long attributed to living in the shadow of one of the largest concentrations of refineries in the world.

 

“It’s our livelihood, but it’s killing us,” Lopez said, standing in what used to be her dining room. Now her house in Beaumont is down to the studs. As Harvey’s floodwaters rose, she tried to save what she could. She piled the dresser drawers on the bed and perched the leather couch up on the coffee table. It did no good. The water didn’t stop until it reached the eaves, and the Lopezes lost everything they own.

 

Just about all of her relatives are conservatives, and indeed the political divides in the county run deep: Even as most of the communities along the Gulf Coast turned red years ago, Jefferson County clung to its Democratic roots. The county is ethnically diverse — 41 percent white, 34 percent black and 20 percent Hispanic — with a historically strong union workforce. Trump won Jefferson by just 419 votes.

 

“To come up with real solutions, you have to be honest with yourself about what causes something to happen,” Lopez said. “It’s not just because some storm came, it was bad and unprecedented. It was unprecedented for a reason, so we have to acknowledge that and start working toward being better. And part of that conversation should be climate change.”

On a porch outside another ruined house nearby, two neighbors who both lost everything to Harvey started having that conversation.

 

Gene Jones, a truck driver who didn’t vote, asked Wilton Johnson, a Trump supporter, if he thought climate change intensified the storm.

 

“I don’t think so, no,” Johnson said.

 

“You don’t? You don’t think about the chemical plants and the hot weather? You don’t think that has anything to do with it?”

 

“I can understand people believing that,” Johnson replied. But he blames natural weather cycles for upending their lives so completely.

 

Jones now lives in a camper in his driveway; Johnson’s father has been sleeping in a recliner in his yard to ward off looters.

 

Johnson feels like he’s gone through the stages of grief. At first, as he fled his home, he denied how devastating the storm might be. Then he got angry, when he realized nothing could be saved — not the family photos or the 100-year-old Bible that fell apart in his hands. He grew depressed and now, finally, he thinks he’s come to accept this new reality as something that just happened because nature is not always kind, and never has been.

 

And he remains unshaken in his support for Trump’s environmental agenda.

 

“We need to be responsible human beings to the Earth, but at the same time we shouldn’t sacrifice the financial freedoms,” he said. “What good is a great environment if we’re poor and living like cavemen? And vice versa, I understand the other side of that: What’s great about living in luxury when you can’t go outside?

 

“I just don’t think we should look at two storms and say, ‘We’re ruining the Earth! Shut the plants down!'”

 

___

 

When Wayne Christopher was a boy in Jefferson County, it got so hot he remembers frying eggs on the sidewalk. It has always been hot here, and there have always been hurricanes.

 

But it seems to him that something is different now. There is a palpable intensity in the air, in the haze that hangs over the interstate. The region has warmed about two degrees in his lifetime, according to the National Oceanic and Atmospheric Administration, and annual rainfall has increased by about 7 inches on average. Christopher counts the number of times a beach road he’s driven on all his life has had to be rebuilt because the ocean overtook it.

 

“The sea keeps moving in — water rising, land disappearing or eroding or whatever you want to call it — it’s happening,” said Christopher, who is 66 now and retired after toiling more than 40 years for the railroad. “I think Mother Nature can come back, but there’s a point to where, if we just keep on and keep on, I don’t know if she can come back.”

 

He thinks the president he helped put in office should do something: take the threat seriously, research before he talks or tweets, not dismiss established science as a hoax because acknowledging it’s real would mean acknowledging that something must be done.

 

But like many others here, Christopher is not pushing to stick with the Paris climate agreement or other global coalitions because he’s not sure it’s fair that the United States should invest in clean energy when other countries that pollute might not. He worries that could cause more job losses to overseas factories, put a squeeze on the middle class and forfeit a slice of American sovereignty.

 

His wife, who also supported Trump, cocked her head as she thought about that sentiment.

 

“I can see the pros, I can see the cons,” Polly Christopher said. “But if you were to simplify it to your children, and they say, ‘Well, everybody else is doing it, if I do it what difference is it going to make?’ you would just get on them and say, ‘You’ve got to do the right thing. Right is right, and wrong’s wrong.'”

 

For weeks, the couple have been gutting Memorial Baptist Church, a place they consider their home. The congregation dwindled over time to about 45, mostly older people, and it was so hard to make ends meet the church canceled a $19,000-a-year flood insurance policy just two months before Harvey hit. Now it could cost some $1 million to rebuild, meaning the church may never be rebuilt at all.

 

So when Christopher’s granddaughter came by to help, found the piano in the otherwise empty sanctuary, sat down and started to play, he was overcome with a sense of grief.

 

“In my head I was thinking the whole time, this could be the last time that piano is played inside the auditorium,” he said. Then she started to sing: “Amazing grace, how sweet the sound …”

 

“It did something to me,” he said.

 

Both he and his wife believe President Trump has a responsibility to look at the destruction Harvey left them with and act accordingly.

 

“He’s got a business mind. Whatever it takes to make money, that’s what he’s going to do to make America great again,” Christopher said, and that’s why he voted for Trump. “But it does make me wonder if he looks at global warming as a real harm. Because you can make all the money in the world here. But if you don’t have a world, what good is it going to do you?”
…

For months, the outlook for the eurozone economy has brightened thanks to a series of electoral defeats for populist parties in key states like France. Now, following votes in Germany and Austria and the uncertainty over the Spanish region of Catalonia, concerns are growing again about the potential impact of euroskeptic politics.

The euro has edged lower in recent weeks despite data showing that the eurozone economy is enjoying one of its strongest periods of growth since the global financial crisis exploded a decade ago. On Monday, it was down 0.3 percent at $1.1785, having been above $1.20 at the end of August for the first time in two years.

 

One of the reasons relates to the electoral success of populist forces, first in Germany in late-September when the anti-immigration Alternative for Germany received almost 13 percent of the vote and won representation into the country’s parliament for the first time. Though the center-right Christian Democrats came out on top, the authority of Chancellor Angela Merkel was somewhat undermined by AfD’s relative success and she has still to forge a new coalition.

 

The populist tide was further evidenced in Sunday’s Austrian election, which saw the right-wing Freedom Party come second with around 27 percent of the vote — enough to possibly become part of a government led by the People’s Party and its 31-year-old leader, Sebastian Kurz.

 

The impact of a coalition involving a party that has sought to downplay the country’s Nazi past could hinder efforts to further integrate the economies of the 19 countries that use the euro, as advocated for by new French President Emmanuel Macron.

 

“Even though Austria is highly integrated and depends on the eurozone’s structure and openness, a new Austrian government will make the eurozone’s life harder, trying to push through self-interests,” ING economist Inga Fechner said.

 

Also of potential concern to the unity of the eurozone is the uncertainty surrounding Catalonia following its disputed independence referendum earlier this month. On Monday, there was still a lack of clarity as to whether the region’s leader, Carles Puigdemont, has declared independence following the vote that Madrid has deemed illegal.

 

The Spanish government of Prime Minister Mariano Rajoy has repeatedly said it’s not willing to negotiate with Puigdemont if independence is on the table, or accept any form of international mediation. The government has threatened to activate Article 155 of Spain’s Constitution, which could see Madrid take temporary control of some parts of Catalonia’s self-government.

 

All these signs of populism come at a time when the European economy is enjoying one of its most sustained upswings for a decade. A run of economic indicators have shown that the recovery, especially among those countries that use the euro currency, has been gaining momentum through 2017. The recovery, which has also seen unemployment come off highs, has prompted speculation that the European Central Bank will start to ease back on some of its emergency stimulus measures in the coming months.

 

Many economists ascribe the improving economic backdrop to the defeat of populist politicians earlier this year, notably in France where National Front leader Marine Le Pen lost overwhelmingly in the presidential runoff against Macron. Her defeat come a few weeks after Geert Wilders’ anti-Islam Freedom Party fared worse than anticipated in Dutch elections.

 

At the start of this year, the rise of populism was considered by many economists as the gravest cloud hanging over Europe’s economic future, especially as worries over Greece had abated. The Brexit vote in Britain in the summer of 2016 had shown how vulnerable the region could be to populist movements. The great fear for those overseeing the euro currency is that a party may come into government seeking to get out of the single currency and revert to the country’s original currency.

 

What’s occurred in the past few weeks is evidence that those populist forces are not done yet.

 

Simon Derrick, chief currency strategist at BNY Mellon, said “it would make sense for the euro to weaken if concerns about populism in the eurozone re-emerged.”

 

The next potential worry is Italy, where elections have to be held by May 2018. The country has for years grown more slowly than other developed economies and there are concerns that a party seeking to blame the country’s problems on the euro could make headway in the elections, potentially triggering more volatility for a currency that’s spent years dodging crises. In August, former premier Silvio Berlusconi floated the idea of a parallel currency being introduced in Italy.

 

 
…

The world economy is the healthiest it’s been in years but could still use a little help from low-interest rates and higher government spending from countries that can afford it, the International Monetary Fund says. 

 

“There was a strong consensus that the global outlook is strengthening,” said Agustin Carstens, governor of the Bank of Mexico and outgoing chair of the IMF’s policy committee. “This does not mean we are declaring victory just yet.” 

 

The 189-member IMF and its sister agency, the World Bank, wrapped up three days of meetings Saturday. 

Broad recovery, risks

The IMF expects the global economy to grow 3.6 percent this year, up from 3.2 percent in 2016. And three-quarters of the global economy is growing, making this the broadest recovery in a decade. 

 

But IMF and World Bank officials pointed to risks that could derail global growth. Geopolitical risks are rising, including a confrontation between the United States and North Korea over Pyongyang’s nuclear weapons program. The income gap between rich and poor is growing, fueling political discontent with the free trade and global cooperation that the IMF and World Bank promote. 

 

So in a communique Saturday, the IMF’s policy committee called on world central banks to protect the fragile global recovery by keeping interest rates down in countries where inflation is too low and economies are performing below potential. 

 

IMF officials have also urged some countries with healthy finances, such as Germany and South Korea, to make investments that will spur growth. 

 

IMF Managing Director Christine Lagarde appealed to countries to enact reforms that will make their economies more efficient and spread prosperity to those who have been left behind. Specifically, Lagarde argued that countries could improve their economies and reduce inequality by putting more women to work, improving their access to credit and narrowing their pay gap with men. 

On Saturday, Ivanka Trump, the president’s daughter and a White House adviser, appeared with World Bank President Jim Yong Kim to launch a World Bank initiative to support women entrepreneurs. The World Bank fund has raised $350 million, which is designed to allow the World Bank to deploy at least $1 billion in capital to finance women-owned businesses. 

 

Ivanka Trump told the audience that she wanted to “spend a lot of time offering any value that I can as a mentor.” 

 

Adjusting to Trump

The World Bank and IMF delegates are still adjusting to the Trump administration, which is skeptical of international organizations and contemptuous of free trade agreements. This week, the United States pulled out of UNESCO, the United Nations’ cultural agency. It is has balked at providing additional capital to the World Bank unless the anti-poverty agency rethinks the way it distributes loans. It has scrapped an Asia-Pacific trade deal and is threatening to pull out of the North American Free Trade Agreement with Canada and Mexico. 

 

Treasury Secretary Steven Mnuchin said he carried in his pocket a list of all the G-20 nations and the size of the trade balances the United States has with each of those nations. With most of the G-20 countries, the United States is running a trade deficit.

 

In a speech Saturday to the IMF policy group, Mnuchin said he wanted to see the IMF be a more “forceful advocate” for strong global growth by taking a harder look at countries that abuse world trade rules. 
…

Throughout Northern California, where wildfires have raged for almost a week, killing at least 36 people and destroying about 6,000 buildings, residents are taking stock of what they have and what they have lost.

Many are feeling lucky to have survived with their lives. The fire’s path of destruction lacked rhyme or reason, destroying an entire winery in one case but leaving patio furniture outside the tasting room untouched.

Pierre Birebent, who has been a winemaker at the Signorello Estate for the past 20 years, said he feels lucky.

WATCH: Winemakers Vow to Rebuild Destroyed Winery

When the fire came to his winery on the Silverado Trail, the main artery of Napa’s Wine Country, Birebent grabbed a hose and tried to fight the flames himself. One of the winery’s owners, who was in the residence above the winery, had fled after alerting the staff to the fire.

Birebent lost the battle to save the winery, the tasting room, an office and the residence. 

“It was like fighting a giant,” he said.

​Damage unknown

It’s too early to know the extent of the damage to Northern California’s wine industry. Fires still burn around the hillsides, and pickers hurry to get the grapes off the vine before they are damaged by smoke, a condition known as “smoke taint.”

At Signorello, employees reported for work Friday, their first chance to see the damage.

Ray Signorello, the winery proprietor, went into Napa to rent temporary office space. He planned to keep the business going and rebuild.

“We can continue somewhat business as usual,” Signorello said.

“Our house is gone,” said Jo Dayoan, allocation director at the winery. “Our soul is not. We are family.”

Much to be thankful for

For Birebent, there are many things to be thankful for, among them, the 30-year-old vineyards, which didn’t burn.

“This is very important because it takes five years to plant the vineyard to get the first crop,” Birebent said.

Also spared by the fire was a warehouse where Signorello stored its 2016 vintage, as well as the last of the 2017 cabernet sauvignon grapes, which had been harvested just days before the fire and sat fermenting in 14 tanks at the edge of the parking lot.

But whether the wine inside the tanks is drinkable remains to be seen. Workers cleared leaves and ash from the outside of the tanks.

The wine from each of the tanks will be tasted and tested at a laboratory. The tanks hold 80 percent of the winery’s 2017 reds, which Birebent said was worth millions.

“It was so hot, we don’t know if the wine is still good or no,” he said.

As they take stock of the damage, the winemaker and the staff here are thinking about rebuilding, even as others continue to face wildfire dangers. The winery workers say they are lucky even as they stand in its ruins.
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In its 19th year, the Fortune Most Powerful Women Summit brought together women leaders from a variety of industries to discuss the opportunities and pitfalls for companies seeking to grow in a fast-paced business environment. VOA Correspondent Mariama Diallo reports.
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Recent comments by U.S. President Donald Trump have raised fears that NAFTA, the 2-decades-old trade pact between Canada, the U.S. and Mexico, may be on its last legs. Proponents of NAFTA warn that scrapping the three-nation deal could cause economic shocks around the globe. But others say that’s just a case of corporate fear mongering. Mil Arcega has more.
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The Trump administration Friday demanded that U.S.-made content account for half the value of the cars and trucks sold under the North American Free Trade Agreement, raising further doubts about any potential deal to renew the pact.

Three sources briefed on the protectionist U.S. proposal, which is in line with U.S. President Donald Trump’s goal of shrinking a trade deficit with Mexico and stemming the loss of U.S. manufacturing jobs, said it also seeks sharply higher North American automotive content overall.

The proposal was made during contentious talks in Washington, in the fourth of seven planned rounds of negotiations to overhaul the treaty. Mexican sources denounced it as absurd and unacceptable, underlining the gaps between NAFTA’s three members as they try to wrap up a deal by a year-end deadline.

Trump, who complains that the original 1994 pact has been a disaster for the United States, is threatening to walk away from the agreement unless major changes are made.

WATCH: Are NAFTA’s Days Numbered?

Sour mood, but no quitting

Washington’s auto industry gambit came hot on the heels of its demand that NAFTA also contain a so-called sunset clause.

That could mean any new deal expires in five years, an idea that Canada and Mexico also strongly oppose.

Although sources briefed on the talks describe the mood as sour, Mexican and Canadian politicians say there is no question of leaving the table for now.

A collapse of NAFTA would wreak havoc throughout the North American economy, disrupting highly integrated manufacturing supply chains and agricultural exports with steep tariffs that would snap back into place. Trade among the three countries has more than quadrupled since 1994 to more than $1.2 trillion annually.

One of the sources close to the talks said Washington wants to increase the North American content requirement for trucks, autos and large engines to 85 percent from 62.5 percent over a period of years. That is in addition to its insistence that 50 percent of content be U.S.-made within the first year of a signed deal.

​Proposal seen as unworkable

A Canadian official noted that senior government figures in Ottawa have rejected both ideas as unworkable.

Trump has made clear he prefers bilateral trade deals, and skeptics wonder whether the U.S. demands are part of an “America First” strategy designed to ensure the current talks fail.

The U.S. Chamber of Commerce has listed the U.S. auto industry demand among a number of “poison pill” proposals that it said would torpedo the talks to renew NAFTA. The chamber says the proposal would cost jobs, because automakers and parts suppliers would likely forgo NAFTA benefits and simply pay the 2.5 percent U.S. tariff for imported cars and many parts.

Unifor, a union that represents most of Canada’s autoworkers, said the U.S. proposals were deliberately untenable. 

“Frankly, I think this is a bully move by the American government,” president Jerry Dias said in a statement.

Trump aides say current rules are too lax and allowed auto companies to bring in too many cheap parts from China and other low-wage Asian countries.

Mexico needs NAFTA

Mexico is heavily dependent on the United States and NAFTA for its economic viability, and uncertainty over the outcome of the talks helped push the Mexican peso to near five-month lows this week.

Mexican Finance Minister Jose Antonio Meade, seeking to downplay any setbacks in the latest round of negotiations, said Friday that tension in the talks was only natural.

Canadian officials also said it was too soon to write off the deal-making process. They noted that U.S. Trade Representative Robert Lighthizer, Canadian Foreign Minister Chrystia Freeland and Mexican Economy Minister Ildefonso Guajardo were to meet in Washington on Tuesday to take stock of the negotiations.

Separately, U.S. negotiators Friday formally asked Canada to address a bilateral dispute over dairy pricing, a request the Canadians are set to resist, sources familiar with the talks said.
…

Disaster-prone countries that keep rebuilding homes, roads and utilities are in danger of becoming uninsurable unless their new infrastructure is built to survive further catastrophe, experts said Friday at a World Bank conference.

New construction must be low in carbon emissions and built on safe land at less risk of destruction as extreme weather intensifies under global warming, they said.

More infrastructure is about to be built in the next 20 years than was built in the past 2,000 years, said experts at the World Bank conference on infrastructure and resilience held in Washington.

The total cost of that infrastructure is seen at some $5 trillion a year.

“The expense of a constant construct, reconstruct, reconstruct, frankly, no country can afford,” said Christiana Figueres, former United Nations’ climate chief.

“Because we know we will be getting more of these effects, we cannot let ourselves get to a scenario where we are systemically uninsurable,” said Figueres.

Among recent disaster losses, no more than half were covered by insurance, she said.

Extreme weather such as flooding, severe storms and drought is increasing with global warming, experts say.

Mapping risky areas and determining the cost of making infrastructure resilient must be done before rebuilding, said Figueres.

She estimated the cost of making low-carbon infrastructure that can withstand shocks might be an additional 10 percent.

Although governments are increasingly aware of the need for resilient infrastructure, residents need incentive and encouragement to rebuild wisely, said Kamal Kishore, member of India’s National Disaster Management Authority.

“If you have a bridge across the River Ganges and you stop it for a day … the economic impact is huge,” he said. “We really have to make the case of life-cycle costs and benefits, not just the upfront costs of infrastructure.”

India has made considerable progress in reducing deaths from cyclones due to a combination of resilient infrastructure, community networks and scientific advances, he said.

Data indicating possible risk must be easily available to ensure infrastructure is not built on land prone to floods or other disasters, said Aris Papadopoulos, former chief executive of cement company Titan America. Papadopoulos recently set up a private-sector risk reduction network with the U.N.’s Office for Disaster Risk Reduction.

“We build in vulnerable locations to the same standards as were built in the safer location, and what’s the result? We have disaster,” he said.

Urging a modern-day Marshall Plan to rebuild the Caribbean devastated by recent hurricanes, British businessman Richard Branson said the islands need more hurricane-proof homes and stronger electricity systems.

The original Marshall Plan was a multibillion-dollar U.S. program that helped rebuild Western European after World War II.

Cutting dependency on costly fossil fuels and switching to solar or wind energy would free up resources for islands that spend as much as a quarter of their national expenditures on fuel, said Branson.

Branson is trying to set up a fund to help Caribbean nations replace fossil fuel-dependent utilities with low-carbon renewable energy sources.

“How much more destruction is needed to show that the way we treat our planet is having serious consequences and sadly will have even more serious consequences?” he asked.
…

The euro zone economy may be building up an impressive head of steam that shows no signs of cooling, but what policymakers at the European Central Bank really want – higher inflation – is still largely absent.

Industrial output in the bloc rose faster than anyone polled by Reuters expected in August, according to data on Thursday which followed a slew of forecast-beating releases and after the International Monetary Fund upgraded its outlook for global growth.

“Although the industrial sector only accounts for a quarter of GDP it has been the euro zone’s most cyclical sector historically, and so is an important indicator of the economy’s wider health,” said Christian Jaccarini at CEBR.

“With the economy gathering momentum, the European Central Bank should feel confident about starting to taper its asset purchase program at the beginning of next year.”

The economy is performing stronger than at any time since the global financial crisis so speculation the ECB will soon begin scaling back its massive stimulus program has been rife.

Policymakers at the Bank will announce on Oct. 26 a six-month extension to its asset purchase program but will cut how much it buys each month to 40 billion euros from January, a September Reuters poll predicted.  

Five people with direct knowledge of discussions told Reuters the ECB is homing in on extending its stimulus for nine months at the next meeting while scaling it back.

Yet the ECB’s key focus is inflation and numbers due on Tuesday will probably confirm prices only rose 1.5 percent in September on a year ago, still a lot weaker than the just below 2 percent rate-setters would like.

According to Reuters polls taken throughout 2017, which have been correct about how low it would remain this year, inflation won’t hit that ECB target for years.

“There is likely to be only a limited pick-up in inflationary pressures, meaning that interest rate hikes can be kept on hold until 2019 – later than markets seem to expect,” economists at Capital Economics wrote.

British dilemma

Across the Atlantic, U.S. Federal Reserve policymakers have already begun tightening but had a prolonged debate about the prospects of a pickup in inflation and slowing the path of future interest rate rises if it did not, according to minutes of the central bank’s last policy meeting.

“Many participants expressed concern that the low inflation readings this year might reflect… the influence of developments that could prove more persistent, and it was noted that some patience in removing policy accommodation while assessing trends in inflation was warranted,” the Fed said in the minutes.

Britain, however, has the opposite problem.

Since the vote in June 2016 to leave the European Union, the pound has lost around 13 percent of its value against the dollar, driving up the costs of imports and caused inflation to run well above the 2 percent the Bank of England would like it at.

In the referendum’s aftermath the Bank cut 25 basis points from borrowing costs, taking them to a record low 0.25 percent, hoping to stave off a predicted economic meltdown after the leave vote.

That meltdown never happened and Britain’s economy was one of the best performers last year although growth has since slowed sharply.

Still, at its November meeting the BoE will raise interest rates for the first time in a decade, according to economists in a recent Reuters poll taken after a barrage of hawkish rhetoric from BoE policymakers. However, most of them also said raising rates now would be a policy mistake.  

“On the strength of the MPC’s rhetoric and current market expectations, we continue to look for a November hike. But this assumes no significant downside surprises in the inflation and wage data next week,” said Allan Monks at JPMorgan.

“If the MPC is minded to back out of tightening in November – in response to the data or the Brexit process – we would expect at least some hint of this in any commentary between now and the next meeting on Nov. 2.”

Britain’s economy shows little sign of breaking out of its lethargy and it is “extraordinary” the BoE is considering raising interest rates, the British Chambers of Commerce said on Friday.

“We’d caution against an earlier than required tightening in monetary policy, which could hit both business and consumer confidence and weaken overall UK growth,” said Suren Thiru, BCC head of economics.

Divorce talks have this week ended in deadlock over a British refusal to clarify how much it will pay on leaving, EU negotiator Michel Barnier said on Thursday.

But EU leaders could hand beleaguered British Prime Minister Theresa May an olive branch in Brexit negotiations next week by launching their own internal preparations for a transition to a new relationship with Britain, giving her some hope.

 
…

China’s imports from North Korea fell 37.9 percent in September from a year earlier, marking the seventh consecutive month of decline, the customs office said Friday.

China-U.S. ties have been strained by President Donald Trump’s criticism of China’s trade practices and by demands that Beijing do more to pressure North Korea over Pyongyan’s nuclear and missile programmes.

China’s exports to North Korea in September dropped 6.7 percent from a year ago, a spokesman for the General Administration of Customs told a briefing, adding no seafood imports from North Korea were recorded last month.

China’s imports from North Korea fell 16.7 percent on-year to $1.48 billion in Jannuary-September, while exports to North Korea rose 20.9 percent to $2.55 billion in the same period.

That created a trade surplus with North Korea at $1.07 billion in the first nine months of this year.
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The wildfires burning through Northern California are sending visitors packing, threatening the $2 billion-plus spent annually by tourists on wine tours, fine food, limousine rides and much more, business leaders said.

At the Inn on First bed and breakfast in the famous wine town of Napa, co-owner Jamie Cherry was encouraging callers to postpone rather than cancel visits, as wildfires burned largely unchecked across the region.

“People are canceling as far as November already,” Cherry said. “It’s going to be devastating in terms of financial loss for everybody.”

The fast-moving fires have killed at least 26 people and left hundreds missing in an area less than an hour’s drive from San Francisco.

With hundreds of wineries, expensive restaurants and bucolic rolling scenery, the wine country of Sonoma and Napa counties is a major draw for visitors. Limousines and buses clog parking lots at weekends as visitors sip Chardonnay and Cabernet Sauvignons in towns known for their mix of rural and cosmopolitan vibes.

Now, with at least 13 burned wineries, shuttered tasting rooms and thick smoke in the air from nearly two dozen fires that have charred more than 190,000 acres across the state, it is unclear how quickly the region can lure back tourists.

‘We’d go back’

Napa Valley welcomed 3.5 million visitors last year, with overnight guests spending on average $402 per day, according to Visit Napa Valley, the region’s tourism marketing group.

“There is a good amount of infrastructure that has burned down, homes have burned down, wineries have burned. There are restaurants that are not going to open quickly,” said Clay Gregory of Visit Napa Valley.

On Thursday, tasting rooms remained closed and the famous Napa Valley Wine Train, which ferries tourists through the vineyards, said it planned to reopen Sunday.

Dozens of limousines and tour buses, their polish dulled by a film of ash, sat in a parking lot and warehouse on the outskirts of Napa. The company’s owner, Michael Graham, said the business had just hit peak demand of 100 reservations a day, but since the fires that had slumped to two.

Graham remains hopeful, however, citing tourism’s quick recovery after the 6.0 earthquake that hit Napa in 2014: “People were out wine-tasting the same day.”

Graham said the region was still largely intact, with vast swathes of countryside untouched by fire.

“It’s just smoky. As soon as they get this contained it will be back to business as usual,” he said.

Others agreed the effect of the fires on tourism would be short-lived.

Roseanne Rosen has fond memories of the trip with her husband to wine country that she just finished ahead of the fires. The couple from Kansas City has been coming for the last decade and has no plans to abandon that tradition.

“It’s one of our favorite destinations and I don’t see that changing,” Rosen said by telephone. “Once people are open and ready for business, we’d go back in an instant.”
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The government of Peru’s President Pedro Pablo Kuczynski said Thursday that it will request special powers to legislate economic policies from the opposition-ruled Congress, after growth slowed sharply during his first year in office.

During a presentation in Congress, Prime Minister Mercedes Araoz said her cabinet wants to legislate policies aimed at consolidating an incipient economic recovery and making Peru a member of the Organization for Economic Co-operation and Development (OECD), a wealthy-country think tank.

In Peru, Congress traditionally grants legislative powers to the executive branch at the start of a president’s term, and it is rare for a prime minister to seek them so far into an administration – underscoring ongoing worries about the economy.

Growth in Peru, one of the region’s most robust economies, faltered early this year after a corruption scandal halted public work projects and severe flooding destroyed billions of dollars in infrastructure.

The government and central bank now expect the economy to grow by about 2.8 percent this year thanks to better prices for Peru’s key copper exports, down from 3.9 percent last year.

Araoz said the economy should expand by at least 4 percent in coming years.

It was unclear whether the opposition would grant the government its request for new legislative powers following a political crisis in September that ended with Congress ousting Kuczynski’s former cabinet.

Kuczynski appointed a more socially conservative cabinet led by Araoz that won initial praise from the right-wing populist party Popular Force, which has an absolute majority in Congress.

But Congress must approve the new cabinet with a vote of confidence scheduled for Thursday.

Araoz said that she would present the request for legislative powers in coming days.

Congress gave Kuczynski legislative authority on economic policies in September 2016, which his government used to pass laws aimed at reducing and expediting bureaucratic permits.
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New research finds nearly 14 million people a year are losing their homes because of sudden onset disasters such as floods and cyclones.

The Internal Displacement Monitoring Center, which analyzed the impact of sudden onset disasters in 204 countries and territories, warns that homelessness will continue to rise unless significant progress is made in managing disaster risk.

According to the research — officially released on Friday, marking International Day for Disaster Reduction — eight of the 10 disaster-prone countries with the highest levels of displacement are in East, South or Southeast Asia. India and China top this list. The two countries outside this region are Russia, ranked ninth, and the United States, ranked 10th.

The head of data and analysis at the center, Justin Ginnetti, said the 13.9 million people displaced by sudden onset disasters excluded those told to evacuate an area before a disaster struck. He called this a conservative figure, since homelessness due to drought was not included in the data.

Floods chiefly repsonsible

“Most of this displacement is being driven by floods, which is on the increase in a globally warming world and where population growth is increasing in flood-prone areas,” Ginnetti said. “Population exposure is indeed a key component of displacement risk. More people are likely to be displaced by disasters in countries with large populations.”

The data show displacement associated with disasters will mainly affect developing countries. However, the chief spokesman for the U.N. International Strategy for Disaster Reduction, Dennis McClean, said economic losses would be greatest in the richer countries. He said this year would probably be the worst year on record in terms of economic losses.

“If we look just at the Atlantic hurricane season, which is still ongoing, we see that economic losses in the United States alone are probably in the region of about $300 billion,” McClean said. “That is what the initial estimates are telling us. And, of course, the losses are perhaps even more significant in small island states in the Caribbean, which have also been devastated by these events.”

Specialists in disaster risk reduction are urging nations to improve land zoning and the quality of buildings, especially in seismic zones and on land exposed to storms and floods. They note that good early warning systems may not save homes but will save lives.
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Washington has increased tensions in talks to renew the North American Free Trade Agreement by insisting that any new deal be allowed to expire after five years, two officials familiar with the negotiations said on Thursday.

Canada and Mexico both strongly oppose the concept of a so-called sunset clause, a provision that had been floated earlier.

But the officials, who asked not to be identified because the talks are confidential, said the U.S. side formally proposed it late on Wednesday during the fourth of seven scheduled rounds to update the rules governing one of the world’s biggest trade blocs.

The Trump administration says the clause, causing NAFTA to expire every five years unless all three countries agree it should continue, is to ensure the pact stays up to date.

But Mexico and Canada insist there is no point updating the pact with such a threat hanging over it, arguing the clause would stunt investment by sowing too much uncertainty about the future of the agreement.

“It’s a source of total uncertainty,” said one of the NAFTA government officials familiar with details of the negotiations.

U.S. President Donald Trump says NAFTA, originally signed in 1994, has been a disaster for the United States and has frequently threatened to scrap it unless major changes are made.

Business and farm groups say abandoning the 23-year-old pact would wreak economic havoc, disrupting cross-border manufacturing supply chains and slapping high tariffs on agricultural products.

Trade between the United States, Canada and Mexico has quadrupled under NAFTA, now topping $1.2 trillion a year. As well as the sunset clause, the United States wants to boost how much North American content autos must contain to qualify for tax-free status and eliminate a dispute settlement mechanisms that Canada insists must stay.

Some trade observers said it is difficult to see how negotiators could reach an agreement given U.S. demands that many see as nonstarters.

The head of Unifor, Canada’s largest private sector labor union, said it was clear the United States did not want a deal.

“NAFTA is not going anywhere. This thing is going into the toilet,” Jerry Dias told reporters on Thursday.

Despite clear signs of impatience from Canada in particular, U.S. negotiators have yet to submit their proposal on rules of origin for the auto sector. That looked unlikely to come before Friday, another official familiar with the talks said.

Trump on Wednesday repeated his warnings that he might terminate the pact and said he was open to doing a bilateral deal with either Canada or Mexico if three-way negotiations fail.

He was speaking at the White House with Canadian Prime Minister Justin Trudeau, who said Canada was “braced” for Trump’s unpredictability but taking a serious approach to the NAFTA talks.

Negotiators were also set to cover the difficult issue of government procurement on Thursday.

Canada and Mexico want their companies to be able to bid on more U.S. federal and state government contracts, but this is at odds with Trump’s “Buy American” agenda. U.S. negotiators have countered with a proposal that would effectively grant the other countries less access, people familiar with the talks say.

On automotive rules of origin, NAFTA negotiators face tough new U.S. demands to increase regional vehicle content to 85 percent from 62.5 percent, with 50 percent required from the United States, according to people briefed on the plan.

The rules of origin demands are among several conditions that the U.S. Chamber of Commerce has labeled “poison pill proposals” that threaten to torpedo the talks.

U.S. Commerce Secretary Wilbur Ross said on Wednesday that he believed higher percentages for automotive content would be achieved, and “car companies will adapt themselves to it.”

However, a study released on Thursday by the Motor Equipment Manufacturers Association, which represents U.S. auto parts makers, showed the higher content requirements would lead to the loss of up to 24,000 U.S. jobs, as some companies would forgo NAFTA’s tariff-free benefits and ship in more components from other countries.
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The European Union’s Brexit negotiator said Thursday that that little progress was made with the U.K. in a fifth round of talks on the country’s departure from the EU in 2019, and that he cannot yet recommend broadening negotiations to include trade.

 

Michel Barnier said that despite the “constructive spirit” shown in this week’s negotiations in Brussels, “we haven’t made any great steps forward.” On the question of how much Britain has to pay to settle its financial commitments, he said: “We have reached a state of deadlock, which is disturbing.”

 

Barnier said he would not be able to recommend to EU leaders meeting next week that “sufficient progress” has been made to broaden the talks to future EU-British relations like trade.

 

The leaders meet in Brussels on Oct. 19-20, and it had been hoped they would agree to widen the talks.

 

The EU says this can only happen when there has been progress on the issues of the financial settlement, the rights of citizens affected by Brexit and the status of the Northern Ireland-Ireland border.

 

But Britain says these issues are closely intertwined with their future relations like trade and must be discussed together.

 

“I hope the member states will see the progress we have made and take a step forward” next week, British Brexit envoy David Davis told reporters.

 

“We would like them to give Michel the means to broaden the negotiations. It’s up to them whether they do it. Clearly I think it’s in the interests of the United Kingdom and the European Union that they do,” Davis said.

 

Barnier said the two sides would work to achieve “sufficient progress” in time for a subsequent meeting of EU leaders in December.

 

Britain must leave the EU on March 29, 2019, but the negotiations must be completed within about a year to leave time for EU states’ national parliaments to ratify the Brexit agreement.

 

Barnier reaffirmed that parting with “no deal will be a very bad deal.”

 

“To be clear, on our side, we will be ready to face any eventualities, and all the eventualities,” he said.
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China has a new richest man, according to the annual Hurun rich list of the country’s top movers and shakers.

Xu Jiayin, the chairman of developer China Evergrande Group, has seized top spot – beating out more familiar faces such as Alibaba Group Holding Ltd’s Jack Ma and rival property magnate Wang Jianlin of Dalian Wanda Group.

Xu’s reported $43 billion wealth – a gain of around $30 billion against last year – comes on the back of a surge in Evergrande’s shares, up over 450 percent so far this year amid plans to cut debt and focus on profit over scale.

The Hurun Report, established in 1999, is the leading China-based organization ranking the wealth of the country’s rich and famous, and its list gives a temperature check on the winners and losers in China.

Growth in China stabilized this year, but while the world’s second largest economy averted a hard landing, some major corporations have buckled under the weight of their debt or been sanctioned by authorities over risky investments overseas.

Wanda’s Wang – who took top spot for the last two years – dropped to fifth in the list after Wanda sold off much of the firm’s hotel and theme park assets to rivals in July, after coming under regulatory scrutiny over its high leverage.

Close behind Evergrande’s Xu were China’s top tech titans – Alibaba’s Jack Ma and Tencent Holdings Ltd’s Pony Ma, who has seen his firm’s value rise on the popularity of its WeChat messaging app and its popular online games.

The list also underlined those who have fallen from grace in corporate China.

Jia Yueting, founder of sprawling conglomerate LeEco that once looked to rival both Tesla Inc and Netflix, dropped to 1,978th place from 31st last year.

Yang Kai, chairman of embattled Huishan Dairy – 66th last year – dropped off the list entirely as his firm fights off creditors amid billions of dollars of unpaid debt.

On the up was Wuxi Pharma Tech’s Li Ge and his wife, propelled by China’s push towards drug innovation, Zhang Lei of fast-growing online news portal Toutiao and Li Shufu of carmaker Geely Automobile Holdings Ltd.

“It has been a good year for manufacturing, cars, education, TMT and healthcare,” Hurun founder Rupert Hoogewerf said.

While many of those on the 2,000-strong list were members of the National People’s Congress and Chinese People’s Political Consultative Conference, only a few were delegates at the upcoming five-yearly Party Congress that begins next week.

These included corn magnate Li Denghai, alcohol billionaire Wu Shaoxun and Pan Gang of dairy giant Yili.

The list, with a combined wealth of $2.6 trillion, saw average wealth rising 12.5 percent – faster than broader economic growth – pointing to the growing financial muscle of China’s super-rich elite.
…

The Trump administration says coal is back and nuclear energy is cool. Not at the expense of natural gas, wind and solar, insists an unusual coalition of business and environmental groups.

Dow Chemical, Koch Industries and U.S. Steel Corp. are standing with environmentalists in opposing an Energy Department plan that would reward nuclear and coal-fired power plants for adding reliability to the nation’s power grid and are pressuring the administration to shift course.

Energy Secretary Rick Perry says the plan is needed to help prevent widespread outages such as those caused by Hurricanes Harvey, Irma and Maria and a 2014 “polar vortex” in the Eastern and Central U.S. The plan aims to reverse a steady tide of retirements of coal and nuclear plants, which have lost market share as natural gas and renewable energy flourish.

“The continued loss of baseload generation … such as coal and nuclear must be stopped,” Perry wrote in a Sept. 28 letter urging the Federal Energy Regulatory Commission to adopt the new rule. “These generation resources are necessary to maintain the resiliency of the electric grid” amid sharp shifts in the U.S. energy market.

Perry’s plan coincides with President Donald Trump’s vow to achieve U.S. “energy dominance” while ending what he and other Republicans call a “war on coal” waged by the Obama administration. Perry, who has said he wants to “make nuclear energy cool again,” is certain to face questions about the plan and the opposition at a congressional hearing Thursday.

Critics see a bailout

The plan would compensate power plant owners that maintain a 90-day fuel supply protected against the elements. Critics say it could result in subsidies worth billions of dollars.

Environmental groups say the plan would boost dirty fuels and harm consumers, while the energy industry warns about interference in the free market and manufacturers complain about higher energy prices that could be passed on to consumers.

“Rick Perry is trying to slam through an outrageous bailout of the coal and nuclear industries on the backs of American consumers,” said Kit Kennedy, an energy policy expert for the Natural Resources Defense Council. “This radical proposal would lead to higher energy bills for consumers and businesses, as well as dirtier air and increased health problems.”

A coalition of industry groups, ranging from the American Council on Renewable Energy to the American Petroleum Institute and the Natural Gas Supply Association, also blasted the plan, saying it could harm “entire industries and their tens of thousands workers.”

Amy Farrell, senior vice president of the American Wind Energy Association, said the proposal could “upend competitive markets that save consumers billions of dollars a year.”

Oil, gas: Let markets work

Marty Durbin, executive vice president of the petroleum institute, the top lobbying group for the oil and gas industry, said officials “need to be careful that government doesn’t put its thumb on the scale” in energy markets. “It’s better to let markets choose, which is what the United States is seeing with the growth of natural gas” as the leading U.S. electricity source, Durbin said.

The Industrial Energy Consumers of America, a trade group that represents Dow, Koch Industries and other manufacturing giants, is among those lobbying against the plan. In a letter to Congress, the group called the proposal “anti-competitive” and said it could distort or “destroy competitive wholesale electricity markets, increase the price of electricity to all consumers” and harm U.S. manufacturing.

The manufacturers and other critics say there is no evidence of a threat to the grid’s day-to-day reliability that would justify the emergency action Perry is seeking.

Indeed, in a report commissioned by Perry and delivered in August, the Energy Department said “reliability is adequate today despite the retirement of 11 percent of the generating capacity available in 2002, as significant additions from natural gas, wind, and solar have come online since then.”

Gerry Cauley, CEO of the North American Electric Reliability Corp., an international regulatory authority, said at a conference in June that “the state of reliability in North America remains strong, and the trend line shows continuing improvement year over year.”

Coal, nuclear groups hail plan

Even so, coal and nuclear groups hailed the plan. National Mining Association President and CEO Hal Quinn called Perry’s action “a long-overdue and necessary step to address the vulnerability of America’s energy grid,” while Maria Korsnick, president and CEO of the Nuclear Energy Institute, said disruptions caused by hurricanes and other extreme weather events show that “the urgency to act in support of the resiliency of the electric grid has never been clearer.”

The Energy Department seeks final action by mid-December, although industry groups and some members of Congress have pushed for a delay.

Sen. Maria Cantwell, D-Wash., said the energy commission should reject Perry’s plan.

“Secretary Perry has embraced an obsolete view of the grid (that) would bail out coal and nuclear power plants at the expense everyone else,” she said.
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The ranking of the 50 most powerful women by Fortune magazine is out. The list include such stalwarts as General Motors Mary Barra and PepsiCo’s Indra Nooyi. But it also seven newcomers, including the first foreign-born Latina CEO on the Fortune 500, Geisha Williams. VOA Correspondent Mariama Diallo was at their annual gathering in Washington this week and has this report.
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Billionaire philanthopist Michael Bloomberg has pledged an additional $64 million for the initiatives intended to slash the number of U.S. coal power plants. Bloomberg’s charity announced Wednesday the money will be donated to environmental groups working to replace coal-fired plants with cleaner forms of energy production. The move came after the Trump administration said it would repeal the Clean Power Plan. VOA’s Zlatica Hoke has this story.
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Over the past few years, Chinese companies have flooded the globe with investments, buying up everything from real estate to football clubs and entertainment companies. As a result, hundreds of billions of dollars in capital have flowed out of the country, draining China’s foreign exchange reserves. But that all has come to a halt this year with the Communist Party beginning to label such high-profile transactions a “national security” risk and bringing some of the country’s biggest dealmakers under scrutiny.

 

The first in a series of shockwaves came in January, when Xiao Jianhua, an eccentric and politically connected wealthy Chinese billionaire, was seized from his residence at the Four Seasons Hotel in Hong Kong by Chinese authorities.

When Xiao was taken away, reports suggested that he was helping Chinese authorities with an investigation into the country’s massive stock market crash of 2015 that saw stocks lose some $4 trillion in value.

But, it is Xiao’s reported ability to secretly move massive amounts of money and his political connections that most have focused on. In an earlier report, China analyst Willy Lam told VOA that Xiao is known as a “white glove” — a broker for powerful political families that include those with ties to former President Jiang Zemin.

The New York Times has described Xiao as a “banker for the ruling class and in 2013, the newspaper reported that he paid $2.4 million to buy shares in an investment firm held by the sister and brother-in-law of Chinese leader Xi Jinping. Xiao’s legal status is unclear and while he is believed to be helping authorities in China with investigations into the financial industry, authorities have made no formal statement about whether he is in custody.

A few months later, as the Communist Party, accompanied by state media, continued to hone its message about the financial risks of heavily-leveraged debt, and overseas investments started to slow dramatically, another jolt occurred with the detention of Wu Xiaohui, the chairman of Chinese financial and insurance giant Anbang.

One of China’s richest and most powerful companies, Anbang is known for its headline-grabbing overseas investments such as its purchase of New York’s iconic Waldorf Astoria Hotel and Manhattan’s JW Marriott Essex House Hotel — and ones that failed — like its $14 billion bid to purchase Starwood Hotels and Resorts Worldwide.

Anbang chairman Wu Xiaohui is married to Zhuo Ran, the granddaughter of former Chinese leader Deng Xiaoping. In a statement shortly after he was detained in early June, Anbang said Wu was temporarily stepping aside as chairman for “personal reasons.” Wu has not been seen in public since June.

 

Soon after Wu’s detention came a second and even broader shock, the ripples of which continue to be felt. News surfaced that China’s banking regulator was scrutinizing the investment and loan guarantees used to back the big overseas investments of not only Anbang, but other big dealmakers including HNA Group, Dalian Wanda Group and Fosun, whose chairman dubs himself the Warren Buffett of China.

 

Many of the companies, such as Dalian Wanda, have become the international face of China with their marquee acquisitions in recent years. Dalian’s shopping spree alone has been dazzling. Over the past two years, the company’s purchases have included the world’s largest cinema chain, a luxury yacht builder, a Spanish football club as well as Hollywood’s Legendary Entertainment media company.

 

So far, the heads of the four other companies appear to have avoided anything beyond scrutiny, and calls to sell off their assets overseas, but there are no signs that the pressure is easing.

When rumors surfaced online in early August that police detained Dalian Wanda chairman Wang Jianlin as he was about to leave China via private jet for London, the company had to work hard to stamp out the speculation.

 

The company called the accusations “groundless,” and noted that Wang was in China’s western province of Lanzhou.

 

Since his company came under scrutiny, Wang moved quickly and in July sold off 77 hotels and 13 theme parks to pay off nearly $10 billion in debt. Still, some continue to believe that he has been barred from leaving the country. In early September, Wang traveled to Hong Kong where he met with the port city’s former chief executive, Tung Chee-hwa. Pictures from the visit were posted on Dalian Wanda’s website.

 

According to Bloomberg, China has asked Anbang to sell its assets outside of the country. For now, the company says it has no plans to sell its overseas acquisitions.

 

 

 
…

 Economic growth in sub-Saharan Africa is expected to be 2.4 percent in 2017, the World Bank said on Wednesday, down from the 2.6 percent projected in April.

It said the downgrade was due to a number of reasons, including Nigeria’s failing to meet expectations but also broader conditions.

“Regional per capita output growth is forecast to be negative for the second consecutive year, while investment growth remains low, and productivity growth is falling,” it said.

Growth across the region, however, was seen rising 3.2 percent in 2018 and 3.5 percent in 2019, forecasts unchanged from earlier this year.

In its latest Africa Pulse report, the Bank said the region would be helped by better commodity prices. Sub-Saharan African economies have been hit by lower commodity prices which slowed growth in the last few years, cutting government revenues.

Albert Zeufack, World Bank chief economist for Africa, said the region’s growth recovery would partly be driven by the continent’s two largest economies — Nigeria and South Africa — exiting recession.

He said the two countries need “deeper reforms” to get back to pre-2014 levels of growth and their political uncertainty needs to be reined in. He said they make up about half of sub-Saharan Africa’s GDP growth.

The World Bank said Nigeria’s economy, the largest in the continent, was expected to expand by 1 percent in 2017.

South Africa’s economy, hit by political worries, was expected to grow just 0.6 percent this year.
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