YCLOAK

On the border of China and Kazakhstan, an international free trade zone has become a showpiece of Chinese President Xi Jinping’s signature Belt and Road initiative to boost global trade and commerce by improving infrastructure and connectivity.

Chinese state media are filled with stories about the stunning success of Horgos, the youngest city of China’s new Silk Road. Last month at China’s Belt and Road Summit — its biggest diplomatic event of the year — promotional videos about Horgos’ booming economy ran on a loop at the press center.

But Chinese business owners and prospective investors who had recently visited the China-Kazakhstan Horgos International Border Cooperation Center (ICBC), told Reuters they were disappointed by the disconnect between the hype and reality.

Rather than the vibrant 21st century trading post of Beijing’s grand vision, Horgos is instead developing a reputation as China’s very own tax haven.

“We were so unimpressed by what we saw that after looking around for three hours, we turned around and drove eight hours straight back to Urumqi,” said a businessman from the capital of China’s far western region of Xianjiang, who only wanted to give his surname, Ma, due to the sensitivity of the topic.

Several business owners echoed complaints about poor design and low visitor numbers made by Ma, who visited Horgos to investigate the viability of opening a high-end clubhouse.

“You’ve got Kazakh farmers walking around with plastic bags full of cheap Chinese T-shirts and you want me to open a club for government officials and businessmen to meet inside the zone — which, by the way, you can’t drive your car into and doesn’t have any five-star hotels?” Ma said.

On the Chinese side of the border there are five malls selling cheap consumer goods, though traders complain there are not enough visitors.

“Sometimes I’ll sit here for a whole day and not make a single sale,” said Ma Yinggui, 56, who has a market stall selling clothes. “Some Kazakhs are rich but most are poor. They come and haggle over a 20 yuan [$2.93] T-shirt.”

More than five years after the 5.3-square-kilometer trade zone opened, much of the Kazakh side remains empty.

Only 25 of the 63 projects on the Kazakh side have investors, according to Ravil Budukov, ICBC press secretary on the Kazakh side. About 3,000 to 4,000 people enter from Kazakhstan each day and around 10,000 from China, he added.

The Xinjiang and Horgos governments declined to make officials available for comment to Reuters for this article.

Huang Sanping, a senior Xinjiang government official, told Reuters at a news conference in Beijing that he had just returned from a visit to Horgos, a city “performing extremely well. It’s full of vitality and flourishing.”

China’s tax haven

Beijing has bestowed numerous tax breaks and preferential policies on Horgos hoping to stimulate growth in this strategic border town in Xinjiang, a key link on the new Silk Road between China and Central Asia, where the government says it is battling to defeat Islamist extremism.

According to Horgos’ tax bureau, 2,411 companies registered in Horgos last year, taking advantage of five years of no company tax, and a further five years paying half rate.

At least half those companies are registered in Horgos solely for tax purposes, estimates Meng Shen, director of Chanson & Co, a boutique investment bank in Beijing.

Chinese celebrities are opting to register production companies in Horgos and an increasing number of financial services and IT companies are also registering there, according to Guan Xuemei from Shenzhou Shunliban, a tax advisory firm that recently opened an office there.

But with no obligation to operate from Horgos or even in Xinjiang, it is unlikely this policy will create jobs or bring money to what has long been an economic backwater, say experts.

“In theory this is a good policy because it aims to stimulate the local economy,” said Shen. “But Beijing didn’t think through the fact lots of companies wouldn’t actually want to operate from Horgos, which is very far away from China’s economic centers.”

Those who do trade in the “free trade zone” find they face restrictions from both sides.

The Russian-led Eurasian Economic Union (EEU) — of which Kazakhstan is a member — limits traders from the Kazakh side to importing up to 50 kg (110 lbs) of any goods per month duty-free.

China bans imports of many food products — the Kazakh goods most desired by Chinese consumers worried about food safety at home — and caps traders from taking more than 8,000 yuan ($1,175) worth of goods out each day.

“The EEU is a significant barrier because Russia and Kazakhstan and other Central Asia countries want to develop their own industries, they don’t want to constantly rely on cheap Chinese goods,” said a former Chinese government official turned businessman, who spoke on the condition of anonymity.

Mao Shishi, 44, who currently raises cattle in nearby Qingshuihe, wants to import wool and wild herbs used in traditional Chinese medicine from Kazakhstan to China through Horgos.

“I’m watching and waiting for any policy changes. Right now we can’t import lamb, fish or wild herbs into China,” Mao said.

Logistics thoroughfare

Plans to develop a parallel special economic zone in Khorgos — as it is known on the Kazakh side — as a logistics hub appear to be having more success.

Trade volumes are skyrocketing at the Khorgos Gateway dry port in Kazakhstan, where container freight is lifted off Chinese trains and onto Kazakh ones because of different gauge rail tracks.

“According to our plans, this year we are going to trans-ship around 100,000 TEUs, five times more than we are doing now,” said Asset Seisenbek, head of the commercial department at Khorgos Gateway, referring to “twenty-foot equivalent units,” an industry measure based on standard shipping container sizes.

Electronics giants HP and Foxconn both ship goods through the dry port, which is faster than sea freight but cheaper than air cargo. One container sent by sea to Europe is about three times cheaper than rail, while air freight is between five to 10 times more expensive, according to Seisenbek.

Last month, China’s COSCO Shipping and Lianyungang port took a 49 percent stake in Khorgos Gateway — which Seisenbek sees as an opportunity to attract more Chinese business.

This sort of investment is what Horgos/Khorgos should hang its hat on, according to Ma, the businessman underwhelmed by the international free trade zone.

“The free trade zone doesn’t need to be that successful if the intercontinental trains and roads take off,” he said. “In the grand scheme of things, that’s the main role for this part of the world.”
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The productivity of American workers was flat in the first three months of this year, while labor costs rose at the fastest pace since the second quarter of last year.

Productivity growth was zero in the January-March quarter after rising at a 1.8 percent annual rate in the fourth quarter, the Labor Department reported Monday. It was the weakest performance since productivity had fallen at a 0.1 percent rate in the second quarter of last year but an improvement from an initial reading of a 0.6 percent decline.

Productivity, the amount of output per hour of work, has been weak through most of the current recovery. Many analysts believe finding a way to boost productivity growth is the biggest economic challenge facing the country, but there is no consensus on the cause of the slowdown.

Labor costs rose at a 2.2 percent rate after having fallen at a 4.6 percent rate in the fourth quarter. It was the fastest gain since April-June of last year.

The revision in first quarter productivity had been expected because of the revision to first quarter gross domestic product, the economy’s total output of goods and services. The government initially reported that GDP had risen by a tepid 0.7 percent rate in the January-March perio. But that was revised to show a slightly better reading of a 1.2 percent gain. The boost in output led to the better reading for productivity.

Since 2007, productivity increases have averaged just 1.2 percent. That’s less than half the 2.6 percent average annual gains turned in from 2000 to 2007, when the country was benefiting from increased efficiency from greater integration of computers and the internet into the workplace.

Rising productivity means increased output for each hour of work, which allows employers to boost wages without triggering higher inflation.

The effort to boost productivity back to the levels since before the Great Recession will likely be a key factor in determining whether President Donald Trump will achieve his goal of boosting overall growth from the weak 2.1 percent average seen since the recession. The economy’s potential for growth is a combination of increases in the labor force and growth in productivity.

During the campaign, Trump pledged to double growth to 4 percent or better. Trump last month released a budget that projects faster economic growth will produce $2 trillion in deficit reduction over the next decade but that forecasts expects growth to rise over the next few years to a sustained pace of 3 percent annual gains.

 
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The Trump administration is considering possible sanctions on Venezuela’s vital energy sector, including state oil company PDVSA, senior White House officials said, in what would be a major escalation of U.S. efforts to pressure the country’s embattled leftist government amid a crackdown on the opposition.

The idea of striking at the core of Venezuela’s economy, which relies on oil for about 95 percent of export revenues, has been discussed at high levels of the administration as part of a wide-ranging review of U.S. options, but officials said it remains under debate and action is not imminent.

The officials, speaking on condition of anonymity, told Reuters the United States could hit PDVSA as part of a “sectoral” sanctions package that would take aim at the OPEC nation’s entire energy industry for the first time.

Complicating factors

But they made clear the administration is moving cautiously, mindful that if such an unprecedented step is taken it could deepen the country’s economic and social crisis, in which millions suffer food shortages and soaring inflation. Two months of anti-government unrest has left more than 60 people dead.

Another complicating factor would be the potential impact on oil shipments to the United States. Venezuela is the third largest oil supplier for the U.S. after Canada and Saudi Arabia. It accounted for 8 percent of U.S. oil imports in March, according to U.S. government figures.

“It’s being considered,” one of the officials told Reuters, saying aides to President Donald Trump have been tasked to have a recommendation on oil sector sanctions ready if needed. “I don’t think we’re at a point to make a decision on it. But all options are on the table. We want to see the bad actors held to account.”

The U.S. deliberations on new sanctions come against the backdrop of the worst protests faced yet by socialist President Nicolas Maduro, who critics accuse of human rights abuses in a clampdown on the opposition.

Since Trump took office in January, he has stepped up targeted sanctions on Venezuela, including on the vice president, the chief judge and seven other Supreme Court justices. He has pressed the Organization of American States to do more to help resolve the crisis.

While Trump has taken a more active approach to Venezuela than his predecessor Barack Obama, he has so far stopped short of drastic economic moves that could hurt the Venezuelan people and give Maduro ammunition to accuse Washington of meddling.

The two administration officials said the United States is also prepared to impose further sanctions on senior officials it accuses of corruption, drug trafficking ties and involvement in what critics see as a campaign of political repression aimed at consolidating Maduro’s rule.

Oil sanctions big step

But broad measures against the country’s vital oil sector, for which the United States is the biggest customer, would significantly ratchet up Washington’s response. The United States has imposed sectoral sanctions against Russia’s energy, banking and defense industries over Moscow’s involvement in Ukraine’s separatist conflict.

The officials declined to specify the mechanisms under consideration and said the timing of any decision would depend heavily on developments on the ground in Venezuela.

Possibilities could include a blanket ban on Venezuelan oil imports and preventing PDVSA from trading and doing business in the United States, which would have a severe impact on PDVSA’s U.S. refining subsidiary Citgo.

A more modest approach, however, could be to bar PDVSA only from bidding on U.S. government contracts, as the Obama administration did in 2011 to punish the company for doing business with Iran. Those limited sanctions were rolled back after the 2015 international nuclear deal with Tehran.

The Venezuelan government and PDVSA did not respond to requests for comment.

U.S. officials recognize, however, that oil sanctions on Venezuela could exacerbate the suffering of the Venezuelan people without any guarantee of success against Maduro, who accuses Washington and Venezuelan opposition of fomenting an attempted coup.

Given the potential for regional spillover, any decision on oil sanctions would require consultation with Venezuela’s neighbors, the officials said.

“The concern we have is that it will be a very serious escalation,” one official said. “We’d have to be prepared to deal with the humanitarian consequences of essentially collapsing the government.”
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The restaurant business can cause serious heartburn. It’s a mixed salad of bureaucracy, money, and paperwork that keeps some chefs from ever selling that first plate of food. But there may be hope as “restaurant incubators” offer chefs an alternative menu for success. Arash Arabasadi reports from Washington.
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Diversification is a growing trend in some sectors of the agriculture industry. Some winemakers in the northwestern state of Oregon are branching out into marijuana as a new business venture. Faith Lapidus reports.
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The U.N. Security Council increased international pressure on North Korea on Friday to give up its pursuit of a nuclear bomb, adding 14 individuals and four companies to its sanctions lists.

The council unanimously voted to impose travel bans and asset freezes following North Korea’s stepped-up ballistic missile launches this year. The tests, including three last month alone, violate existing council resolutions demanding that Pyongyang cease such activity.

The United States, which drafted the resolution in consultation with China, took a strong stance, with U.S. Ambassador Nikki Haley declaring that “all options for responding to future provocations must remain on the table.”

“Beyond diplomatic and financial consequences, the United States remains prepared to counteract North Korean aggression through other means, if necessary,” Haley said.

Future launches ‘unacceptable’

“The United States is fully committed to defending ourselves and our allies against North Korean aggression,” she added.  

Haley said future ballistic missile launches or nuclear tests would be “absolutely unacceptable,” and she urged Pyongyang to choose “a more constructive path toward stability, security and peace.”

Several of the individuals added to the sanctions list were elderly, including one man, Ri Yong Mu, 92. He is listed as the vice chairman of a state commission that deals with military and security affairs, including acquisition and procurement. At least two other designees are in their 80s, and two are 79.

“The individuals and entities that will be subject to the travel ban and asset freeze by this resolution include the senior DPRK officials and its core military operators that are directly responsible for the regime’s illicit nuclear and ballistic missile programs,” South Korea’s U.N. ambassador, Cho Tae-yul, told the council.

Sanctions have financial sting

“Some DPRK businessmen and commercial entities are also newly designated, which I believe will help further restrict the DPRK’s ability to finance its illicit activities,” he added. DPRK is the customary acronym in English for North Korea’s formal name, the Democratic People’s Republic of Korea.

There is growing frustration in the international community with North Korea for its continued defiant behavior. Since January, Pyongyang has test-fired nine ballistic missiles, some landing close to South Korea, Japan and even Russia.

Even Beijing is reportedly increasingly weary of its rogue ally. China has condemned the launches and repeatedly called for a reduction in tensions on the Korean Peninsula and a return to talks.

“The current situation on the Korean Peninsula is complex and sensitive,” China’s Ambassador Liu Jieyi said. “At the same time, there is a critical window of opportunity for the nuclear issue of the peninsula to come back to the right track of dialogue and negotiations.”

US targets Russians

On Thursday, the United States imposed unilateral sanctions on three Russian firms and one individual for their support of North Korea’s weapons program. Russia’s deputy U.N. ambassador, Vladimir Safronkov, expressed his government’s anger at the move.

“This step is something that is very puzzling and deeply disappointing,” Safronkov said, demanding an explanation from the United States.  

“It’s been shown that this is a destructive approach when instead of diplomatic instruments, the sledgehammer of sanctions is being used as a universal way of resolving issues,” Safronkov said. “And this fully applies to the current decision made by Washington; it is not helpful in settling the situation in the Korean Peninsula.”

He noted Moscow’s disappointment that relations with Washington had not improved since the start of the Trump administration and that sanctions remained a constant of U.S. policy.

“Instead of trying to work through the bilateral backlog in our work, Washington is doing exactly the opposite, and undertaking unfriendly steps which make it more difficult to normalize our dialogue and make it more difficult to cooperate in international affairs,” he added.

The United States’ unilateral sanctions on Moscow for its invasion and annexation of Ukraine’s Crimea region in March 2014 remain in effect as well.
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The European Union and China recommitted Friday to the 2015 Paris climate deal, one day after the United States announced it would withdraw from it.

In a joint statement, the EU and China said climate change and clean energy “will become a main pillar” of their bilateral partnership.

European Council President Donald Tusk said the fight against climate change would continue, with or without the United States:

“Today, China and Europe have demonstrated solidarity with future generations and responsibilities for the whole planet,” he said. “We are convinced that yesterday’s decision is a big mistake.”

Chinese Premier Li Keqiang, in Brussels for an EU-China business summit, said it was important for China and EU relationships to become more stable.

“We believe that there have been changes in the international situation, and there will be rising uncertainty and destabilizing factors,” he said. “This requires our efforts to resolve existing issues.”

Other issues

Besides climate change, other issues discussed at the summit included trade, investment, the migration crisis, North Korea and the security partnership in Africa.

Li had expressed China’s continued support for the global climate deal on Thursday during his meeting with German Chancellor Angela Merkel, saying, “China will stand by its responsibilities on climate change.”

European Commission President Jean-Claude Juncker said China agreed with the EU on the “unhappiness” about America’s unilateral decision to abandon the climate agreement.

The 2015 agreement, signed by 195 countries, calls for reducing the impact of climate change by keeping the global temperature rise this century well below 2 degrees Celsius above pre-industrial levels.

The EU and China committed to actions related to climate change, such as developing ways to change into zero-emissions economies, promoting zero-carbon transitions in developing countries and developing long-term decarbonization plans.

Wendel Trio, director of the Climate Action Network Europe, called the EU-China statement a milestone in the history of global climate diplomacy.

“This historic partnership to push forward with the Paris Agreement is a significant advance in the fight against climate change. Through deeper cooperation on climate action, the EU and China can propel the global clean energy transition,” Trio said.

China and the EU are two of the three biggest economies in the world with a large carbon footprint. If one of them were to follow the U.S. withdrawal, it’s unlikely that the Paris accord would lead to large-scale reduction of emissions.

Push from Greenpeace

Ansgar Kiene of the environmental activist group Greenpeace said it was clear from the global response to the American decision that leaders around the world were united in the fight against climate change. But Kiene urged leaders to translate their words into actions.

“The EU and China are switching to clean energy production too slowly to keep global temperature rises below levels that will cause catastrophic changes in our climate,” Kiene said. “The EU’s investment in renewable energy, once the highest in the world, has dropped off in recent years as its targets for renewables were too low compared to the real rate of growth.”

China still produces 62 percent of its energy with coal, according to Greenpeace. But despite its bad record in the past, China’s investments in recent years in solar and wind energy have been much larger than those of any other country. Investments in renewable energy in Europe, though, have dropped by half in the past six years.

In withdrawing the United States from the climate accord, which was signed by his predecessor, Barack Obama, U.S. President Donald Trump cited the predicted economic burden and job losses associated with complying with the accord as some of his reasons.

“The Paris climate accord is simply the latest example of Washington entering into an agreement that disadvantages the United States to the exclusive benefit of other countries,” Trump said.

Renegotiation spurned

Trump said the U.S. could re-enter negotiations on the climate pact, but that idea was dismissed by the EU Commissioner for Climate Action Miguel Arias Cañete, who said Friday that “the 29 articles of the Paris Agreement are not to be renegotiated, they are to be implemented.”

China and the European Union wrote in their joint statement that they thought investing in tackling climate change would actually contribute to job creation, investment opportunities and economic growth.

Many world leaders have condemned the U.S. withdrawal. French President Emmanuel Macron even invited scientists to relocate to France, saying in a speech televised in English, “Make our planet great again.”

The United States joined Nicaragua and Syria as the only countries in the world that are not part of the Paris Agreement.
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The U.S. trade deficit rose in April to the highest level since January. The politically sensitive trade gap with China registered a sharp increase.

The Commerce Department said Friday that the U.S. trade gap in goods and services climbed 5.2 percent to $47.6 billion in April from March. Exports dropped 0.3 percent to $191 billion, pulled down by a drop in automotive exports. Imports rose 0.8 percent to $238.6 billion as Americans bought more foreign-made cellphones and other consumer goods.

So far this year, the trade deficit is up 13.4 percent from a year earlier to $186.6 billion. Exports are up 6.1 percent to $765.6 billion this year, but imports are up more _ 7.5 percent to $952.2 billion. So far in 2017, the United States is running a $268.7 billion deficit in goods and an $82.1 billion surplus in services such as banking and tourism.

The deficit in goods with China rose by 12.4 percent to $27.6 billion in April.

The Trump administration has vowed to reduce the trade deficit, blaming the gap between exports and imports on abusive practices by America’s trading partners.

President Donald Trump recently has singled out Germany for criticism, saying it is unfairly benefiting from a weak euro. When a country’s currency is weak, its products enjoy a price advantage in foreign markets. The trade deficit with Germany rose 4.3 percent in April to $5.5 billion.

 
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The price of oil has fallen sharply as investors bet that President Donald Trump’s decision to pull the United States out of the Paris climate agreement will increase the country’s oil and gas production.

The cost of a barrel of crude slumped 2.4 percent, or $1.18, to $47.18 in electronic trading in New York on Friday, hours after Trump said the U.S. would immediately stop implementing the Paris deal. He said his administration could try to renegotiate the existing agreement or try to create a new one that is more favorable to the U.S.

The deal would have required the U.S. to reduce polluting emissions by more than a quarter below 2005 levels by 2025, potentially limiting the growth of high-emissions industries like oil and gas production. Economists, however, say that the climate deal would likely help create about as many jobs in renewable energy as it might cost in polluting industries.

U.S. oil production has already been increasing in recent months since the price of crude came off lows last year, making expensive shale oil extraction more economically viable.

“Now that U.S. President Trump has announced that the U.S. will be withdrawing from the Paris Climate Agreement, it is expected that the U.S. will expand its oil production even more sharply,” said analysts at German bank Commerzbank.

The increase in U.S. production is neutralizing the efforts of the OPEC cartel and other major oil-producing nations, like Russia, to support prices by limiting their output. OPEC and 10 other countries led by Russia agreed last week to extend for nine months, to March, a production cut of 1.8 million barrels a day initially agreed on in November.

On Friday, the head of Russia’s state-controlled Rosneft oil giant said that that a rise in shale oil output in the U.S. would likely offset the effect from the OPEC and Russian production cuts.

Speaking at an economic forum in St.Petersburg, Rosneft CEO Igor Sechin said that the OPEC and Russian cuts fall short of “systemic measures that would lead to long term stabilization.”

He said that thanks to increasing efficiency, U.S. shale oil producers would likely deliver an additional 1.5 million barrels of crude a day to the market in 2018.
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The heated debate over India’s cash ban continues, with critics saying it slowed an economy that was growing, while the government says economic momentum was barely affected.

Critics say the scrapping of 86 percent of the country’s currency last November cost India its status as the world’s fastest growing economy.

According to data released this week, from January to March, growth plunged to 6.1 percent – lower than China’s 6.9 percent growth in the same period.

Overall growth for the last financial year, which began in April 2016 and ended in March 2017, however, stood at 7.1 percent.

Finance Minister Arun Jaitley has tried to distance the disappointing economic numbers from the currency ban, citing other factors.

“There was some slowdown visible, given the global and domestic situation, even prior to demonetization in the last year,” he told reporters.

The slowdown affected almost all sectors of the economy, with farming, manufacturing and services all taking a hit. With people scrambling to get access to new notes, consumption slowed sharply, impacting both small shopkeepers and large businesses.

The government, however, is encouraged by forecasts that the economy is expected to recover swiftly on the back of monsoon rains, which are expected to be plentiful, and a slew of major reform measures.

As economists estimated growth this year will rebound to 7.4 percent, the government pointed out that India’s economy is still among the world’s top performers. Jaitley said given the global scenario, “7 to 8 percent growth, which at the moment is the Indian normal, is fairly reasonable and by global standards very good.”

There are widespread expectations of a major economic boost from India’s most ambitious tax reform action since independence – the launch of a nationwide tax that will replace a plethora of levies starting July 1.

The World Bank said this week the reform would lower the cost of doing business for firms and reduce logistics costs.

In the coming year, “we actually have very strong fundamentals of the Indian economy, GDP growth being up, exports have revived and there has been continued reform momentum,” said Frederico Gil Sander, a senior economist at the World Bank in New Delhi.

And while demonetization undoubtedly left its imprint on India by slowing down the economy, the government is optimistic there will be long-term gains because the move would help clean up an economy where many businesses and professionals evade taxes, resulting in the generation of what is known as “black money.”

“The message has gone loud and clear and it continues to this day that it is no longer safe to deal in cash,” said Jaitley.

Skeptics say only improved tax collections in the coming years will demonstrate whether that is true, or whether tax evasion remains a challenge in a country where cash transactions are the norm in large sectors of the economy.
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Long the preserve of geeky enthusiasts, bitcoin is going mainstream in Asia, attracting Mrs Watanabe — the metaphorical Japanese housewife investor — South Korean retirees and thousands of others trying to escape rock-bottom savings rates by investing in the cryptocurrency.

Asia’s moms and pops, regular investors in stock and futures markets, have been dazzled by bitcoin’s 100 percent surge so far this year. In comparison, the broader Asian stocks benchmark has gained 17 percent over the same period.

Even after a tumble from last week’s record $2,779.08 high, bitcoin rose more than 60 percent in May alone, driven higher in part by investors in Japan and South Korea stepping in as China cooled after a central bank crackdown earlier this year.

Legal tender in Japan

Over the last two weeks, and encouraged by Japan’s recognition of bitcoin as legal tender in April, exchanges say interest has jumped from the two countries. Bitcoin trades at a premium in both, because of tough money-laundering rules that make it hard for people to move bitcoin in and out.

“After I first heard about the bitcoin scheme, I was so excited I couldn’t sleep. It’s like buying a dream,” said Mutsuko Higo, a 55-year-old Japanese social insurance and labor consultant who bought around 200,000 yen ($1,800) worth of bitcoin in March to supplement her retirement savings.

“Everyone says we can’t rely on Japanese pensions anymore,” she said. “This worries me, so I started bitcoins.”

Thriving investment culture

Asia has proved fertile ground for bitcoin because of the region’s thriving retail investment culture, where swapping investment tips is common. China, Japan and South Korea are home to several of the world’s busiest cryptocurrency exchanges, according to a ranking by CoinMarketCap.

“Right now, it’s a form of speculation, like stocks,” said Park Hyo-jin, a 27-year-old South Korean who owns around 3 million won ($2,700) of bitcoin. “I don’t think anybody in South Korea buys bitcoin to use it.”

The risks, though, are rising too.

Bitcoin is largely unregulated across Asia, while rules governing bitcoin exchanges can be patchy.

In Hong Kong, bitcoin exchanges operate under money service operator licenses, like money changers, while in South Korea they are regulated similar to online shopping malls, trading physical goods. Often there are no rules on investor protection.

Park and Higo were drawn into bitcoin by friends. Others are attracted through seminars, social media groups and blogs penned by amateur investors.

Noboru Hanaki, a 27-year-old Japanese web marketer and bitcoin investor, said his personal finance blog gets around 30,000 page views each month. The most popular post is an explanation of bitcoin, he said, noting that when the bitcoin price surged last month, readership of the article doubled.

Rachel Poole, a Hong Kong-based kindergarten teacher, said she read about bitcoin in the press, and bought five bitcoins in March for around HK$40,000 ($5,100) after studying blogs on the topic. She kept four as an investment and has made HK$12,000 tax-free trading the fifth after classes.

“I wish I’d done it earlier,” she said.

Not everyone’s making money.

Scams, pyramid schemes

The bitcoin frenzy has spawned scams, with police in South Korea last month uncovering a $55 million cryptocurrency pyramid scheme that sucked in thousands of homemakers, workers and self-employed businessmen seduced by slick marketing and promises of wealth.

Leonhard Weese, president of the Bitcoin Association of Hong Kong and a bitcoin investor, warned amateur investors against speculating in the digital currency.

Some larger exchanges have voluntarily adopted security measures and compensation guarantees, according to their websites, although there are dozens of smaller platforms operating more or less unchecked.

In South Korea, the Financial Services Commission (FSC) has set up a task force to explore regulating cryptocurrencies, but it has not set a timeline for publishing its conclusions, an official there said.

In Japan — where memories are still fresh of the spectacular 2014 collapse of Mt. Gox, the world’s biggest bitcoin exchange at the time — the Financial Services Agency (FSA) said it supervises bitcoin exchanges, but not traders or investors.

Some professional investors say bitcoin can be a useful hedge to help diversify a portfolio, but investors should be cautious.

“This is an extremely volatile and innovative asset class,” said Pietro Ventani, managing director of APP Advisers, an asset allocation strategy firm.
…

Exactly eight years after the Great Recession ended, the U.S. job market has settled into a sweet spot of steadily solid growth.

The 4.4 percent unemployment rate matches a decade low. Many people who had stopped looking for jobs are coming off the sidelines to find them. More part-timers are finding full-time work. About all that’s still missing is a broad acceleration in pay. 

On Friday, when the government releases the jobs report for May, that pattern is likely to extend itself. The consensus expectation of economists is that the Labor Department will report that employers added 176,000 jobs, according to a survey by FactSet, a data provider. That’s right in line with the monthly average of 174,000 over the past three months.

All told, it’s evidence of an American economy that is running neither too hot nor too cold, with growth holding at a tepid but far from recessionary 2 percent annual rate. Few economists foresee another downturn looming, in part because the recovery from the recession has been steady but grinding, with little sign of the sort of overheated pressures that normally trigger a recession.

May jobs expectations high

Separate reports Thursday solidified expectations that job growth for May was healthy. Payroll processor ADP reported that in a private survey of companies, it found that a hefty 253,000 jobs were added in May, mostly among companies with fewer than 500 workers.

Nor are layoffs much of a concern. Weekly applications for unemployment benefits, which tend to reflect the pace of layoffs, averaged a low 238,000 over the past four weeks, according to the Labor Department.

The government’s monthly jobs report produces a net gain by estimating how many jobs were created and comparing that figure with how many it estimates were lost.

The unemployment rate is expected to have remained in May at 4.4 percent, a low figure that historically has reflected a healthy job market. If hiring maintains its current pace, it would exceed population growth, and the unemployment rate should eventually fall even further.

Mark Zandi, chief economist at Moody’s Analytics, estimates that monthly job growth above 80,000 or so should cause the unemployment rate to fall.

“I think 4 percent unemployment is dead-ahead, and we’ll probably go past that,” he said. 

Other measures of unemployment

Still, the jobs report produces several different measures of unemployment, and the broadest gauge might be most critical to watch Friday. This particular measure includes not only the officially unemployed but also part-time workers who would prefer full-time jobs and people who want a job but aren’t actively looking for one and so aren’t counted as unemployed.

Known as the “U-6” rate, this measure is one of the favorite metrics for Trump administration officials. The U-6 has plunged since January to 8.6 percent in April, a 0.8 point decline.

The decline in that measure is an encouraging sign that jobless people who had given up hope of working are now being hired. If that trend continued in May, a falling U-6 would point to a strengthening economy despite weak growth during the first three months of the year.

But the influx of job seekers can also inflict a drag on pay growth. As more people start seeking jobs, employers begin to have less incentive to raise pay. It’s only when employers face a shallow pool of job applicants that they tend to feel compelled to raise pay in hopes of hiring people who fit their needs.

Annual growth in average hourly earnings was a so-so 2.6 percent in April. And whatever meaningful pay raises that exist are going disproportionately to managers and supervisors. For workers who aren’t supervisors, average hourly pay has risen just 2.3 percent. In a healthy economy, average pay gains would typically grow roughly 3.5 percent a year.

The Trump administration has designated the pace of hiring for good-paying skilled jobs in construction, manufacturing and mining as among the key categories it monitors for economic health. Those three sectors were relatively weak in April.
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A jail in Chicago is serving some of the best Italian pizza in town. Inmates are making gourmet pizzas for their fellow prisoners. It’s part of a training program called Recipe for Change in which the inmates can acquire skills to get jobs after they are released. VOA’s Deborah Block has more.
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U.S. Treasury Secretary Steven Mnuchin said on Thursday he was confident that Congress would raise the federal debt limit  “before there’s an issue” with U.S. creditworthiness, and he pledged that the Trump administration’s tax reform plans would be paid for.

“We’re going to get it increased,” Mnuchin told Fox Business Network about the debt limit. “The credit of the United States is the utmost. I’ve said to Congress they should do it as quickly as they can. But we are very focused on working with them and I’m confident we’ll get there before there’s an issue.”

Mnuchin said last week that he wanted a “clean” debt ceiling increase before the start of Congress’ summer recess in early August.

Mnuchin said that it “makes no sense” to view the Trump administration’s tax reform plans through a “static” budget analysis that does not account for economic growth effects. He has previously pledged that increased economic growth would generate more revenue to offset lower tax rates.

“We’re about creating economic growth, we’re about broadening the base and we’re going to make sure that this is tax reform, not just tax cuts, and that they’re paid for,” Mnuchin said.
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President Donald Trump is moving the United States out of the Paris climate agreement, signed by nearly 200 other nations.

Trump said Thursday that the Paris agreement hurts U.S. economic growth, costs millions of American jobs and puts U.S. firms at a disadvantage. However, his decision contrasted with the views of hundreds of American business leaders who urged him to continue participating in the climate agreement.

While the president said Washington would stop implementing the Paris accord immediately, he added that he would begin negotiations aimed at rejoining the Paris accord or a similar agreement on terms more advantageous to the United States.  

“We will see if we can make a deal that’s fair,” Trump said. An audience at the White House Rose Garden warmly applauded his announcement.

Among the many corporations that opposed the move to bow out of the Paris Agreement were Mars, Nike, Levi Strauss and Starbucks. Their top corporate officers signed a letter to Trump several months ago, arguing that failing to build a low-carbon economy would put U.S. “prosperity at risk.”

WATCH: Trump: US ‘Will Cease All Implementation’ of Paris Climate Accord

Trump: ‘Fortune’ at stake

Trump said the climate agreement, as presently written, would cost U.S. businesses “a vast fortune” and lead to the loss of 7 million jobs by 2025.

Tesla founder Elon Musk tried to persuade the president to stay in the accord and said Wednesday that he would quit the White House business advisory council if Washington left the Paris Agreement.

GE chief Jeff Immelt has written that customers, partners and countries are demanding technology that generates electric power while improving energy efficiency and cutting costs.

Oil companies like Chevron and ExxonMobil recently argued that the Paris Agreement gives their firms a more predictable future, and therefore more manageable one. The oil companies and some coal firms also say remaining part of the accord helps maintain U.S. influence over future talks.  

Earlier this week, more than 60 percent of Exxon shareholders voted to require that the firm do more analysis and disclosure of the likely impact of tougher climate policies on company revenue. Previous efforts to force such disclosures failed to get a majority of votes from shareholders.  

Some other business, Republican and conservative groups agreed with Trump’s action. The Heritage Foundation, for example, said the accord produces “devastating” economic costs and “zero” environmental benefits.
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A Chinese company that makes shoes for Ivanka Trump and other brands denied allegations Thursday of excessive overtime and low wages made by three activists who have been arrested or disappeared.

The Associated Press reported Tuesday that Hua Haifeng, an investigator for China Labor Watch, a New York-based nonprofit, had been arrested on a charge of illegal surveillance while his two colleagues — Li Zhao and Su Heng — are missing and rights groups fear they have been detained. They were investigating Huajian Group factories in the southern Chinese cities of Ganzhou and Dongguan.

“We are shocked,” Long Shan, a spokeswoman for the Huajian Group, said in an email to The Associated Press. “As a renowned global media outlet, you have put out many untrue reports not based on facts and without our consent.”

China Labor Watch executive director Li Qiang said Thursday he still had not been able to confirm the status of the two men. Huajian was contacted before AP’s initial reports were published but issued no statement until Thursday.

Long said the company had stopped producing Ivanka Trump shoes months ago. She said that Hua Haifeng joined the group’s factory in Dongguan on May 20, but left after less than a week, and Su Heng began working at their Ganzhou factory on April 28, but also left after a short time. She said she did not know their current whereabouts.

“By coming to Huajian to work, they are Huajian employees. Huajian staff must comply with China’s laws and regulations and Huajian’s rules,” she said, adding that at least one of the men “used methods like taking photographs and video to obtain the company’s trade secrets, which is not in line with the company’s regulations. Our company has the right to hold him accountable.”

She said reports of managers verbally abusing workers, including insults and a crude reference in Chinese to female genitalia, were based on misunderstanding. “It is the local dialect being used as management language,” she said.

She said Huajian was looking into allegations of improper use of student interns.

Ivanka Trump’s brand declined to comment on the allegations or the arrest and disappearances. Marc Fisher, which produces shoes for Ivanka Trump and other brands, said it was looking into the allegations.

China Labor Watch has been exposing poor working conditions at suppliers to some of the world’s best-known companies for nearly two decades, but Li said his work has never before attracted this level of scrutiny from China’s state security apparatus.

The arrest and disappearances come amid a crackdown on perceived threats to the stability of China’s ruling Communist Party, particularly from sources with foreign ties such as China Labor Watch. Faced with rising labor unrest and a slowing economy, Beijing has taken a stern approach to activism in southern China’s manufacturing belt and to human rights advocates generally, sparking a wave of critical reports about disappearances, public confessions, forced repatriation and torture in custody.

 
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The business relationship between China and Europe is showing several contradictory trends as Beijing seeks to protect its own state-owned enterprises (SOEs) and its leaders seek foreign investments promising further liberalization in rules.

Chinese Premier Li Keqiang was in Berlin on Wednesday calling for joint efforts to promote trade liberalization and investment facilitation. On the same day, a European industry body in China expressed concerns about discrimination against foreign investors and painted a bleak picture of investment growth by Europe-based companies.

Li’s itinerary, which includes a visit to the European Union headquarters in Brussels, comes in the midst of rising political demand for ensuring reciprocity in business dealings with China. Some European countries are asking the EU to make laws enabling them to closely scrutinize Chinese investments and weed out the dubious ones.

 “The discussion in itself shows that there is a lot of frustration in Europe on the lack of reciprocity,” said Mats Harborn, president of the European Chamber. “We have open bets for Chinese investments while for us to go to China is a whiling road, so this is causing now political discussions in Europe,” he said. 

Given such political conditions, Li’s agenda may seem very ambitious unless China is ready to offer major trade-offs. He is trying to persuade European leaders to accord the status of “market economy” to China, and relax their actions on the dumping of Chinese goods. He also wants the EU to grant a certificate of airworthiness for a China-developed large passenger plane, the C919.

Thomas Gatley, head of research at Beijing-based Gavekal Dragonomics, said the central government in Beijing does make some efforts to open up investment sectors by tweaking the negative list. But these actions are not implemented on the ground.

 “We have seen some measures in the form of revised negative list, slowly sub-sector by sub-sector, China opening up to foreign investment in the official capacity,” Gatley told VOA. “But the (foreign) firms continue to find that when they try to operate in these previously closed areas, there is a lot of de facto barriers to success. That continues to be the substance of complaints by foreign companies.”

European companies have reported much better performance in China in the past year. Harborn said this had to do with the government’s stimulus package in 2016, and there are questions if the high growth scenario will continue in the coming months.

Julian Evans-Pritchard, China economist for Capital Economics, said the Chinese economy showed signs of recovery in 2016 because of a generous flow of credit by financial institutions. But this may not continue as the government is cracking down on risky lending.

“We had quite a sharp slowdown in credit over the past half year, particularly since the start of the year, they have been cracking down quite hard on financial risks on bank and financial institutions,” Evans-Pritchard told VOA. 

A business confidence survey conducted by the European Chamber revealed over 60 percent of its member-companies regard China’s slowing economy as the number one cause for concern. This is a significant change from past years when the focus of complaints was discriminatory treatment of foreign companies and regulatory controls.

But several members of the Chamber continue to worry about discrimination, saying environmental enforcement agencies are still a lot tougher with foreign companies than they are with local ones.

Another new source of worry for foreign firms is the increasing competitiveness of Chinese companies, which is something that will increase with time as Beijing goes about implementing the China 2025 plan to push the local industry into using the next generation of technology.

“European companies in China acknowledge that Chinese companies are getting increasingly innovative. Rather than a challenge, this should be perceived as an opportunity,” said Denis Depoux, Roland Berger Co-Head for Asia. 
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Canada’s defense minister repeated a threat Wednesday to cancel the purchase of 18 fighter jets from Boeing Co. because of the company’s trade complaint against Canadian plane maker Bombardier.

Harjit Sajjan said Boeing’s action against Bombardier is “unfounded” and not the behavior of a “trusted partner.” He said buying the Super Hornet fighter jets “requires a trusted industry partner.”

Sajjan urged Boeing to withdraw the complaint. Canada’s foreign minister has also threatened to block the order.

“Our government — and I stress this — our government is disappointed in the action of one of our leading industry partners,” he said. 

Complaint could mean duties

Chicago-based Boeing’s trade complaint prompted a U.S. Commerce Department anti-dumping investigation that could result in duties being imposed on Bombardier’s new larger C Series passenger aircraft. Boeing insists the plane receives Canadian government subsidies that give it an advantage internationally.

Canada’s threat is coming amid increasing trade disputes with the U.S. 

Scott Day, a spokesman for Boeing, noted that Sajjan also recognized Boeing as a strong partner in the past and for the future. Day defended the company’s trade action. 

“This is a commercial matter that Boeing is seeking to address through the normal course for resolving such issues,” Day said in an email. 

Boeing petitioned the U.S. Commerce Department and the U.S. International Trade Commission to investigate subsidies of Montreal-based Bombardier’s C Series aircraft. Boeing says Bombardier has received more than US $3 billion in government subsidies that let it engage in “predatory pricing.”

Brazil has also launched a formal complaint to the World Trade Organization over Canadian subsidies to Bombardier. Sao Paolo-based Embraer is a fierce rival of Bombardier.

Government investment

The Quebec government invested US $1 billion in exchange for a 49.5 percent stake in the C Series last year. Canada’s federal government also recently provided a US $275 million loan to Bombardier, which struggled to win orders for its new medium-size plane. But Bombardier won a 75-plane order for the C Series from U.S.-based Delta Air Lines in 2016. Bombardier said its planes never competed with Boeing in the sale to Delta.

The Canadian government said late last year it would enter into discussions on buying 18 Super Hornet jet fighters from Boeing on an interim basis and hold an open competition to buy more planes over the next five years. Canada remains part of Lockheed Martin’s F-35 Joint Strike Fighter program. 

 
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Major investors put U.S. industry on notice Wednesday that climate change matters, even as reports emerged that President Donald Trump plans to withdraw the United States from an international pact to fight global warming.

A number of large institutional fund firms including BlackRock, the world’s largest asset manager, supported a shareholder resolution calling on ExxonMobil to share more information about how new technologies and climate change regulations could impact the business of the world’s largest publicly traded oil company. The proposal won the support of 62.3 percent of votes cast.

The victory, on such a wide margin, was hailed by climate activists as a turning point in their decades-long campaign to get oil and gas companies to communicate how they would adapt to a low-carbon economy.

Major investors see major risk

With major investors now seeing climate change as a major risk, activists said U.S. corporations will have to be more transparent about the impact of a warming planet even if the United States withdraws from the 2015 Paris climate accord, as Trump promised during his presidential campaign.

“Economic forces are outrunning any other considerations,” said Anne Simpson, investment director for sustainability at the California Public Employees’ Retirement System, one of the sponsors of the resolution.

She credited big investors in Exxon for the change, since at least some of them switched their votes after last year when a similar measure won just 38 percent support.

“We have seen a sea change in their viewpoint,” she said.

Many top investors now consider their votes on shareholder proposals “on merit, rather than considering it a test of loyalty to management,” she said.

Among Exxon’s top investors, Vanguard Group and BlackRock opposed last year’s call for climate change reporting. A spokeswoman for Vanguard, which has about 7 percent of Exxon’s shares, declined to comment on its voting this year.

A person familiar with the matter said funds run by BlackRock, which holds about 6 percent of Exxon shares, voted in favor of the climate resolution.

Filings showing their exact votes are not due for months.

But both fund firms and others have taken steps since last year to make it easier to support climate resolutions.

Doug Holt, a spokesman for Exxon’s ninth-largest investor Northern Trust Corp, said it voted in favor of the proposal, citing its own guidelines updated in 2016.

Vote from the street

The investment firms’ approach reflects a new interest in climate matters among their own investors, who have stuffed money into so-called green mutual funds and other vehicles that use environmental factors in their stock picking.

Wall Street’s priorities have shifted the terms of debate at a number of other energy and utility companies. A majority of shareholders voting at Occidental Petroleum Corp and PPL Corp called for similar reports on the risks of climate change. Votes on two more of the measures are scheduled for June 7 at Devon Energy and at Hess.

Michael Crosby, involved in corporate outreach for the Midwest Capuchin Franciscans, a religious order, said Wednesday’s vote was a rejection of Exxon’s arguments it already provides enough detail on its outlook.

“The Street is saying, you have to give better evidence,” Crosby said.

Exxon and the Paris deal

After the measure passed, Exxon Chief Executive Officer Darren Woods said its board would reconsider its climate communications.

The activists now face the task of maintaining alliances with leaders like Woods who opposed their resolutions but who in some cases support the 195-nation Paris agreement. Exxon said in a March 22 letter to the White House that the Paris deal is “an effective framework for addressing the risks of climate change.”

Trump had at least one ally at Exxon’s meeting in Dallas, Steven Milloy of Potomac, Maryland, who urged other investors to support his resolution that would make it harder to file proposals like the one on climate change.

Milloy said management should show less concern for climate issues, which he called misplaced, and cited Trump as a model.

“For the first time we have a president who actively opposes climate hysteria,” Milloy said.

According to Exxon, Milloy’s proposal received support from 1.6 percent of votes cast.
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The head of a New York-based advocacy group has called on President Donald Trump and his older daughter to help secure the release of three men who reported labor violations at a Chinese company that makes shoes bearing the Ivanka Trump brand.

“We appeal to President Trump, Ivanka Trump herself, and to her related brand company to advocate and press for the release of our activists,” Li Qiang, executive director of China Labor Watch, the men’s employer, said Wednesday.

The Ivanka Trump brand has declined to comment.  The White House and Ivanka Trump’s lawyer did not immediately respond to requests for comment.  Calls to provincial police in China were not answered. Chinese Foreign Ministry spokeswoman Hua Chunying said she was unaware of the situation and declined to make further comments.

Hua Haifeng and two other labor activists, Li Zhao and Su Heng, had been covertly investigating labor conditions at two Chinese factories that make shoes for Trump and other brands, in the cities of Ganzhou and Dongguan. They disclosed preliminary findings to China Labor Watch, indicating workers at the factories had been subject to extremely long hours.

Hua was arrested in Jiangxi province on suspicion of illegally using eavesdropping equipment; he and the other two men disappeared Saturday and were last seen in Ganzhou, in southern Jiangxi province, China Labor Watch reported Tuesday.

The arrest and disappearances came amid Chinese President Xi Jinping’s crackdown on the country’s advocacy groups and civil society. In the past year, dozens of human rights activists have been detained in China.

The global human rights group Amnesty International called for the release of the three men if they are being held only for investigating possible labor abuses at the factories, which are owned by Huajian International.

“Activists exposing potential human rights abuses deserve protection, not persecution,” said Amnesty International spokesman William Nee. “The trio appear to be the latest to fall foul of the Chinese authorities’ aggressive campaign against human rights activists who have any ties to overseas organizations, using the pretense of ‘national security.’ ”

The relationship between the Trump family and China has received widespread attention since last year’s presidential campaign.  While Trump has accused China of taking coveted manufacturing jobs from the U.S., the Trump family has sought to benefit financially from the Chinese market.

Trump recently obtained more than 75 trademarks in China. The family of Jared Kushner, Ivanka Trump’s husband, is attempting to raise money from Chinese investors for a real estate venture.
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When Rajnish Dhall’s driver wanted to borrow money to buy a home, Dhall suggested he go to a bank. But without proof of income or tax returns to show his credentials, the driver said no bank would lend to him.

It was the start of a whole new business for Dhall, a former banker whose firm aims to help the hundreds of millions of informal workers who make up the bulk of India’s labor force.

They are the newly emerging home-owning class.

“My driver was earning a steady income and could have paid back the loan easily, yet none of the banks would lend to him because he didn’t have the necessary paperwork,” Dhall told Reuters. “The housing problem is very real and visible, especially in a city like Mumbai. There is certainly aspiration to own a home, but without finance, there is no way to realize the aspiration.”

Dhall lent his driver the money, then looked more closely at home loans for a host of other workers in the informal sector.

Of India’s 470 million-strong workforce, about 90 percent is in the informal sector. They include domestic help, street vendors, daily wage earners and small business operators, who may have no collateral and whose incomes are irregular.

They have few options besides borrowing from money lenders and employers, Dhall found. So he set up Micro Housing Finance Corp. to give home loans to low-income and informal workers.

Housing for all

More homes are desperately needed.

Already, one in three Indians live in cities, many in crowded slums and other informal settlements. Every year, tens of thousands of villagers migrate to cities in search of jobs, and the pace of urbanization is set to rise.

India has a shortage of about 20 million urban homes; the shortfall disproportionately affects families earning less than 16,000 rupees ($248) a month, according to consultancy KPMG.

Prime Minister Narendra Modi has made affordable housing a priority, offering incentives such as subsidized loans to meet a 2022 target of “Housing for All,” even as critics say the plan bypasses the homeless.

The government plan aims to create 20 million new urban homes and 30 million rural homes.

An affordable home is typically about 250 square feet (23 square meters) in size, and can cost up to 1.2 million rupees ($18,600). It is aimed at families earning 8,000-25,000 rupees a month, and is usually located in the outskirts of the city where land is cheaper.

In recent years, developers including the Tata group, Mahindra and TVS group have entered the affordable housing market, enticed by government incentives and future potential.

These big firms have enhanced the quality and reputation of affordable homes, which were once described as “vertical slums.”

About 15 micro home finance companies have also launched, with reputable builders and more ready finance combining for better results for low-income earners.

Increasingly, it is a choice between “owning a good-quality, formal home in the periphery of the city over a badly made or informal home in the city,” said Vikram Jain, director of social consultancy FSG, which has studied the segment.

“With more developers and better access to finance, they are well designed, quality constructions that residents take pride in owning,” he told Reuters.

From chalk to pigeons

India’s micro housing finance companies have a loan portfolio of more than $160 million, with near-zero defaults, Jain estimates.

But micro home loans of up to 1 million rupees for low-income clients only account for a quarter of home loans.

Micro home finance companies lend up to 90 percent of the value of the property, at slightly higher interest rates of about 13 percent, on average. The repayment term can be up to 25 years.

Since its founding, MHFC has dispensed about 14,000 home loans, Dhall said.

Its customers represent 600 diverse professions — from a man selling grains to feed pigeons, to one making marking chalk for tailors, and a grass seller for people with cows at home.

At Aadhar Housing Finance — owned in part by the World Bank’s International Finance Corporation — more than three-quarters of customers did not have a credit history when they asked for a loan, said Chief Executive Deo Shankar Tripathi.

Aadhar has given more than 50,000 home loans, mostly in India’s poorest states where customers typically buy a plot of land and build a modest home, Tripathi said.

The high cost of land needed to build homes can be a challenge to affordable housing. Rising construction costs and limited financing for developers are other constraints.

But Tripathi said nobody should be deterred.

“Owning a home is a dream for everyone. For the low-income segment, a home means security, empowerment and greater inclusion in society,” Tripathi said.

“We cannot give them a big bungalow like Mukesh Ambani’s [India’s wealthiest man], but we can make a decent home within the reach of everyone,” he said.
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A group of Senate Democrats has sent a letter to U.S. President Donald Trump requesting information about a raft of trademark approvals from China this year that they say may violate the U.S. Constitution’s ban on gifts from foreign governments.

“China’s rapid approvals after years of court battles have raised questions as to whether the trademarks will prevent you from standing up to China on behalf of American workers and their businesses,” the eight senators, led by Michigan Democrat Debbie Stabenow and Connecticut Democrat Richard Blumenthal, wrote in the letter Tuesday.

China’s most recent nod for a Trump trademark, covering clothing, came on May 6, bringing to 40 the number of marks China has granted or provisionally granted to the president and a related company, DTTM Operations LLC, since his inauguration. If there are no objections, provisional approvals are formally registered after 90 days. China has also rejected or partially rejected nine Trump trademarks since the inauguration.

Trademarks give the holder monopoly rights to a brand in a given market. In many jurisdictions, like China, they can also be filed defensively, to prevent squatters from using a name. Because trademarks are granted at the discretion of foreign governments and can be enormously valuable, they can be problematic for U.S. officials, who are barred by the emoluments clause of the constitution from accepting anything of value from foreign states without congressional approval.

In their letter, the senators were particularly interested in any special efforts Trump, his Chinese lawyers, or the U.S. Embassy in China, which sometimes advocates for U.S. firms, may have made to secure approval for the president’s trademarks. They cited an Associated Press report quoting one of Trump’s lawyers in China, Spring Chang, who said that “government relations are an important part of trademark strategy in China.”

Concern about favoritism is particularly sharp in China, where the courts and bureaucracy are designed to reflect the will of the ruling Communist Party. China has defended its handling of Trump’s intellectual property interests, saying it followed the law in processing his applications, though some trademark lawyers viewed the pace as unusually quick and well-coordinated. In addition, China approved one trademark for Trump-branded construction services after a 10-year legal battle that turned in his favor only after he declared his candidacy.

Alan Garten, chief legal officer of The Trump Organization, did not respond immediately to a request for comment. He has previously said that Trump’s trademark activity in China predates his election and noted that Trump has stepped away from managing his company. However, the president retains an ownership stake in his global branding and real estate empire.

In April, Citizens for Responsibility and Ethics in Washington, a watchdog group, added “gratuitous Chinese trademarks” to its lawsuit against the president for alleged emoluments violations. Trump has dismissed the suit as without merit.
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Vietnamese Prime Minister Nguyen Xuan Phuc said Tuesday that he would sign deals for U.S. goods and services worth $15 billion to $17 billion during his visit to Washington, mainly for high-technology products and for services.

“Vietnam will increase the import of high technologies and services from the United States, and on the occasion of this visit, many important deals will be made,” Phuc told a U.S. Chamber of Commerce dinner.

Phuc, who is due to meet with U.S. President Donald Trump on Wednesday at the end of a three-day visit to the United States, did not provide further details of the transactions.

GE Power Chief Executive Officer Steve Bolze told the dinner that General Electric Co. would sign deals worth about $6 billion with Vietnam, but also offered no details.

Phuc’s comments came after U.S. Trade Representative Robert Lighthizer expressed concern about the rapid growth of the U.S. trade deficit with Vietnam, saying this was a new challenge for the two countries and that he was looking to Phuc to help address it.

“Over the last decade, our bilateral trade deficit has risen from about $7 billion to nearly $32 billion,” Lighthizer said. “This concerning growth in our trade deficit presents new challenges and shows us that there is considerable potential to improve further our important trade relationship.”

Reducing deficits

Lighthizer and other Trump administration trade officials have pledged to work to reduce U.S. bilateral deficits with major trading partners. The $32 billion deficit with Vietnam last year — the sixth-largest U.S. trade deficit — reflects growing imports of Vietnamese semiconductors and other electronics products in addition to more traditional sectors such as footwear, apparel and furniture.

The trade issue has become a potential irritant in a relationship where Washington and Hanoi have stepped up security cooperation in recent years, given shared concerns about China’s increasingly assertive behavior in East Asia.

Phuc’s meeting with Trump makes him the first Southeast Asian leader to visit the White House under the new administration.

It reflected calls, letters, diplomatic contacts and lower-level visits that started long before Trump took office in Washington, where Vietnam retains a lobbyist at $30,000 a month.

Vietnam was disappointed when Trump ditched the 12-nation Trans-Pacific Partnership (TPP) trade pact, in which Hanoi was expected to be one of the main beneficiaries, and focused U.S. trade policy on reducing deficits.
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Mexico’s foreign minister says the country is “inevitably” set to review rules of origin when renegotiating the North American Free Trade Agreement, giving a boost to President Donald Trump’s manufacturing push.

Foreign Relations Secretary Luis Videgaray said Tuesday at an event in Miami that NAFTA has allowed Mexican industry to enter the U.S. market with lax rules of origin. The rules dictate how much U.S. content a product assembled in Mexico must have in order to escape tariffs when being imported into the United States. Currently set at 62.5 percent for the auto industry, that number could increase.

“One part that must inevitably be reviewed is the chapter on rules of origin,” Videgaray said at the University of Miami. “Over time, the free trade agreement has sometimes been used — not always, of course, but sometimes — as a way to access the U.S. market perhaps with laxity in some ways of rules of origin.”

The Trump administration told Congress this month there would be 90 days of consultations on the renegotiation of the 23-year-old pact before beginning talks with Canada and Mexico. Annual trade of goods between Mexico and the U.S. was worth $525 billion in 2016, with the U.S. running a trade deficit of more than $63 billion.

The foreign minister said Mexico won’t entertain any talks on building a wall along the border. Videgaray maintained it is seen as an unfriendly sign and questioned its efficiency. Trump’s budget seeks $2.6 billion for border security technology, including money to design and build a wall along the southern border. Trump repeatedly promised voters during the campaign that Mexico would pay for a wall.
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