Trump to Weigh New Tariffs Targeting China 

White House trade adviser Peter Navarro said Thursday that President Donald Trump would soon consider new punitive measures against China for its alleged “theft” of intellectual property.

U.S. officials, according to news accounts, are considering imposing as much as $60 billion in annual tariffs against Chinese information technology, telecommunications and consumer exports to the U.S. in an effort to trim its chronic annual trade deficit with Beijing by $100 billion. Last year, the U.S. says it imported Chinese goods worth $375 billion more than it exported to China.

“In the coming weeks, President Trump is going to have on his desk some recommendations,” Navarro told CNBC. “This will be one of the many steps the president is going to courageously take in order to address unfair trade practices.

“I don’t think there’s a single person … on Wall Street that will oppose cracking down on China’s theft of our intellectual property or their forced transfer,” Navarro said.

The new tariffs and other measures would be in addition to the 25 percent tariff on steel imports to the U.S. and 10 percent levy on aluminum that Trump announced last week, some of which affect China.

​At a political fundraiser Wednesday, Trump attacked several trading partners for the billions of dollars in trade surpluses they have built up against the U.S. He contended that China had become an economic power — the world’s second biggest economy — because of its trade surplus with the United States.

China warned it would likely retaliate against any new tariffs the U.S. imposes.

Foreign minister spokesman Lu Kang said, “History has proven that a trade war is in no one’s interest.”

He said that “if an undesirable situation arises, China has the intention of safeguarding its legitimate rights.”

Trump’s new tariffs on metal imports have led in recent days to volatility on U.S. stock exchanges, with wide day-to-day swings of hundreds of points in stock indexes. 

But Navarro said the U.S. can impose the tariffs in a way that can be good for the American people and good for the global trading system. We can do this in a way that is peaceful and will improve and strengthen the trading system. … Everybody on Wall Street needs to understand: Just relax.”

HSBC Has 59 Percent Gender Pay Gap, Biggest Among British Banks

HSBC will reveal a gender pay gap of 59 percent at its main U.K. banking operation, the biggest yet disclosed by a British bank, according to a copy of the lender’s report on the subject seen by Reuters on Thursday ahead of its publication.

The bank will also disclose a mean gender bonus gap of 86 percent at HSBC Bank Plc, which is the biggest of the lender’s seven entities in Britain and employs 23,507 people.

A spokeswoman for the bank confirmed the contents of the report.

The gender pay gap is the biggest yet reported by a British financial firm, according to government data, with some firms yet to provide figures ahead of an April deadline set by Prime Minister Theresa May last year.

Almost 50 years since the passage of Britain’s equal pay act, the continued gulf in earnings between men and women has attracted significant public attention over the past year or so.

In common with other banks, HSBC said its pay gap was largely accounted for by the bank having fewer women in senior roles.

The gender pay gap measures the difference between the average salary of men and women, calculated on an hourly basis.

HSBC said women held only 23 percent of senior leadership positions in its workforce in Britain, despite accounting for more than half of total staff.

The bank said it was taking a number of steps to reduce the pay gap, including committing to an aspirational target of women holding 30 percent of senior roles by 2020.

Last month, Asia-focused Standard Chartered reported a gap of 30 percent in Britain, while Virgin Money — the only major UK lender run by a woman — said its female staff earned on average 32.5 percent less per hour than its male workforce.

Lloyds Banking Group and Royal Bank of Scotland reported gender pay gaps of 32.8 percent and 37 percent respectively.

Barclays said last month it paid women in its international division, which houses its investment bank, on average 48 percent of what men earned in fixed pay.

The pay gaps have drawn criticism from lawmakers and are likely to spur questions from investors in the upcoming season for shareholder meetings, with stock prices and future earnings potential strongly linked to banks’ efforts to revive their reputations in the wake of the global financial crisis.

Germany Says Trade War Could Damage Global Recovery

Germany said on Thursday that any escalation of U.S. President Donald Trump’s tariffs on metal imports into a full-blown trade war could cause tangible damage to the global recovery, although the tariffs themselves should have only a limited effect.

Trump last week ordered the imposition of duties on incoming steel and aluminum and threatened to levy a tax on European cars if the European Union did not remove “horrific” tariffs and trade barriers on a range of goods.

“The German economic upswing is continuing at the beginning of 2018. The global economic environment is still favorable,” the Economy Ministry said in its monthly report. But it said U.S. trade policies were creating a sense of uncertainty.

The tariffs on steel and aluminum will affect trade flows in some regions, but their overall implications for the global economy are likely to be manageable, it said.

“But a possible escalation into a trade war and rising uncertainty among market participants could cause tangible damage,” it added.

European Council President Donald Tusk on Wednesday urged the United States to revive trade talks rather than escalate a dispute over tariffs on metals and cars.

And Swiss National Bank Chairman Thomas Jordan said on Thursday that U.S. protectionism could be a threat to the export-dependent Swiss economy and trigger safe-haven flows that would drive up the value of the Swiss currency.

‘At a crossroads’

Germany’s new economy minister, Peter Altmaier, said Trump was challenging the multilateral trade system as defined by the rules of the World Trade Organization (WTO).

“We are at a very important crossroads,” Altmaier said, warning of a scenario in which countries could start a spiral of tit-for-tat trade restrictions.

“This is a really huge challenge with implications for all of us,” Altmaier added. He said consumers in all countries would end up footing the bill because tariffs would push up prices for many kinds of products.

The threat of a full-blown trade war will also be on the agenda of the G-20 meeting in Argentina, where finance ministers and central bank governors from the world’s 20 biggest economies meet from March 17 to 20.

Germany’s new finance minister, Olaf Scholz, will meet his U.S. counterpart Steven Mnuchin on Sunday or Monday on the sidelines of the meeting to discuss trade, banking regulation and other issues, senior German officials said on Thursday.

“The minister will have bilateral meetings with all G-7 counterparts,” one of the officials said, on condition of anonymity, adding that multilateral trade would “certainly be a big topic” at the G-20 meeting.

The taxation of profits from digital business and regulation of crypto currencies will also be in focus, the official added.

 

Surge in Airline Hiring Boosts Interest in Aspiring Pilots

Major U.S. airlines are hiring pilots at a rate not seen since before 9/11, and that is encouraging more young people to consider a career in the cockpit.

Hiring is likely to remain brisk for years. Smaller airlines in the U.S. are struggling with a shortage that will continue as they lose pilots to the bigger carriers, which in turn will need to replace thousands of retiring pilots over the next few years.

 

Aircraft maker Boeing predicts that the U.S. will need 117,000 new pilots by 2036. Just a decade ago thousands of pilots were furloughed and some abandoned the profession.

 

The shortage has been felt most keenly at regional carriers where many pilots start their airline careers.

 

Last summer, Alaska Airlines subsidiary Horizon Air canceled more than 300 flights over two months for lack of pilots. Republic Airways filed for bankruptcy protection in 2016, citing a pilot shortage that forced it to ground flights.

 

Many regional carriers fly smaller planes for American Eagle, Delta Connection and United Express. Signing bonuses and higher pay have helped them hire more than 17,000 pilots in the past four years, but that only replaced those who moved up to the major carriers, according to the Regional Airline Association.

 

Demand at the major airlines is expected to grow as thousands of pilots at American, Delta, United and Southwest hit the U.S. mandatory pilot-retirement age of 65 in the next several years.

 

American Airlines CEO Doug Parker believes the industry will cope.

 

“Economics is going to take care of this, and I think that’s what is happening now,” Parker says. “The [flight] schools are starting to fill up with people who realize, ‘If I can get myself to 1,500 hours [the minimum flight hours needed to get an airline-pilot license], I can be assured of a career as a pilot.’ That’s not something people could convince themselves of from 9/11 on until now.”

 

Pilot hiring nosedived after the Sept. 11, 2001 terror attacks that led to a decline in travel, and again during the global financial crisis in 2008-2009. Major U.S. airlines hired only 30 pilots in 2009, according to Future & Active Pilot Advisors, a career-counseling business for pilots.

 

The job market didn’t pick up significantly until around 2014. Last year 10 of the largest U.S. passenger and cargo airlines hired 4,988 pilots, the most since 2000 when they hired 5,105.

 

“It’s the best sellers’ market I have seen in the last 45 years of monitoring airline pilot hiring,” says Louis Smith, a retired airline pilot who runs the pilot-counseling outfit.

 

Smith says forums for aspiring pilots that once drew a couple dozen people now sometimes attract more than 150. Some hope to make a mid-career change, which was rare just a few years ago.

 

Aaron Ludomirski is one of those career-changers. The 31-year-old from Asbury Park, New Jersey, says he always wanted to be a pilot but studied business instead because the bleak job opportunities for pilots in the years after 9/11 didn’t justify the cost of school and flight training. After college he started an online marketing business.

 

“Year after year I found myself less and less satisfied with my work,” he says. “I started thinking about what kind of career would really lead me to feeling fulfilled and accomplished, and I kept coming back to aviation.”

 

Ludomirski did some fresh research and learned that pilots were back in demand — and more would be retiring in the next few years. He quit his job and went to flight school. Now he is working as a flight instructor to gain the required flying time for an airline pilot.

 

“I can interview for and even accept a conditional letter of employment and know I have my dream job lined up for me when I’m ready,” he says.

 

Applications for commercial aviation majors at the University of North Dakota, a big aeronautical school, have more than doubled in the last three years, says Elizabeth Bjerke, an aviation professor and one of the authors of the university’s widely watched forecast on pilot supply.

 

Some students graduate early to take advantage of the job market and the chance to move up the seniority list quickly because so many older pilots are retiring.

 

“Our graduates will fly at the regionals for a very short period,” Bjerke said. “They are getting picked up by the major carriers in their mid-20s, which would have been just crazy to think of 15 or 20 years ago.”

 

Michael Wiggins, chairman of the aeronautical science department at Embry-Riddle Aeronautical University, says his school’s graduates are getting multiple job offers from regional airlines.

 

Pilots who become captains on jumbo jets that fly international routes can earn more than $300,000 a year. But for anyone starting out in the profession, the training is expensive — upward of $100,000.

 

A few years ago, those who made it faced starting pay for first officers or co-pilots at regional airlines in the low-$20,000s. With bonuses and higher hourly rates, some regionals now claim to offer starting pay of $80,000 or more, but even that might not be enough to meet future demand.

 

The Regional Airline Association is pushing to change a 2013 federal rule that requires 1,500 hours of flying time — usually in small, single-engine planes — by replacing some of it with supervised classroom instruction. The group’s president, Faye Malarkey Black, says supervised training would produce aviators with skills more relevant to piloting an airliner.

 

But a similar proposal appears stalled in Congress, partly due to opposition from families of the 50 people who died in the last deadly crash of a U.S. airliner, a Colgan Air plane in 2009. Black believes the Trump administration has the authority to change the minimum flight hours without waiting for Congress to act, but she admits that will be difficult “as long as those changes are successfully cast as rolling back safety.”

 

JetBlue Airways is beginning a small-scale program of training people with no flying experience — an approach used by Lufthansa and other international airlines. The JetBlue program costs about $125,000, however, the airline says it is looking into providing financial assistance.

 

Even with assistance, however, life for newcomers can be taxing. In addition to flying smaller planes for lower wages, they work on holidays and spend lots of time away from home.

 

Starting pilots need “a passion for flying that drives the thrill of going to work,” says Smith, the career adviser. “It’s certainly not for everyone.”

 

Amazon: Prime Video Lured Millions to Shopping Club

Amazon.com Inc.’s top television shows drew more than 5 million people worldwide to its Prime shopping club by early 2017, according to company documents, revealing for the first time how the retailer’s bet on original video is paying off.

The documents also show that Amazon’s U.S. audience for all video programming on Prime, including films and TV shows it licenses from other companies, was about 26 million customers.

Amazon has never released figures for its total audience.

The internal documents compare metrics that have never been reported for 19 shows exclusive to Amazon: their cost, their viewership and the number of people they helped lure to Prime.

Known as Prime Originals, the shows account for as much as a quarter of what analysts estimate to be total Prime sign-ups from late 2014 to early 2017, the period covered by the documents.

Viewers to shoppers

Core to Amazon’s strategy is the use of video to convert viewers into shoppers. Fans access Amazon’s lineup by joining Prime, a club that includes two-day package delivery and other perks, for an annual fee.

The company declined to comment on the documents seen by Reuters. But Chief Executive Jeff Bezos has been upfront about the company’s use of entertainment to drive merchandise sales.

The world’s biggest online retailer launched Amazon Studios in 2010 to develop original programs that have since grabbed awards and Hollywood buzz.

“When we win a Golden Globe, it helps us sell more shoes,” Bezos said at a 2016 technology conference near Los Angeles. He said film and TV customers renew their subscriptions “at higher rates, and they convert from free trials at higher rates” than members who do not stream videos on Prime.

​$5 billion in video

Video has grown to be one of Amazon’s biggest expenditures at $5 billion per year for original and licensed content, two people familiar with the matter said. The company has never disclosed how many subscribers it won as a result, making it hard for investors to evaluate its programming decisions.

The internal documents show what Amazon considers to be the financial logic of its strategy, and why the company is now making more commercial projects in addition to shows aimed at winning awards, the people said.

For example, the first season of the popular drama The Man in the High Castle, an alternate history depicting Germany as the victor of World War II, had 8 million U.S. viewers as of early 2017, according to the documents. The program cost $72 million in production and marketing and attracted 1.15 million new subscribers worldwide based on Amazon’s accounting, the documents showed.

Amazon calculated that the show drew new Prime members at an average cost of $63 per subscriber.

That is far less than the $99 that subscribers pay in the United States for Prime; the company charges similar fees abroad. Prime members also buy more goods from Amazon than non-members, Bezos has said, further boosting profit.

Amazon’s secret math

Precisely how Amazon determines a customer’s motivation for joining its Prime club is not clear from the documents viewed by Reuters.

But a person familiar with its strategy said the company credits a specific show for luring someone to start or extend a Prime subscription if that program is the first one a customer streams after signing up. That metric, referenced throughout the documents, is known as a “first stream.”

The company then calculates how expensive the viewer was to acquire by dividing the show’s costs by the number of first streams it had. The lower that figure, the better.

The internal documents do not show how long subscribers stayed with Prime, nor do they indicate how much shopping they do on Amazon. The company reviews other metrics for its programs as well. Consequently, the documents do not provide enough information to determine the overall profitability of Amazon’s Hollywood endeavor.

Still, the numbers indicate that broad-interest shows can lure Prime members cheaply by Amazon’s calculations. One big winner was the motoring series The Grand Tour, which stars the former presenters of BBC’s Top Gear. The show had more than 1.5 million first streams from Prime members worldwide, at a cost of $49 per subscriber in its first season.

The documents seen by Reuters reflect Prime subscribers in the United States, United Kingdom, Germany, Austria and Japan, where Amazon’s programs were available before Prime Video rolled out globally in December 2016.

Analysts estimate that 75 million or more customers have Prime subscriptions worldwide, including about half of all households in the United States.

Bigger bets

About 26 million U.S. Prime members watched television and movies on Amazon as of early 2017. Reuters calculated this number from the documents, which showed how many viewers a TV series had as a percentage of total Prime Video customers.

Rival Netflix Inc had twice that many U.S. subscribers in the first quarter of last year. It does not disclose how many were active viewers.

For years, Amazon Studios aimed to win credibility in Hollywood with sophisticated shows beloved by critics. Its marquee series Transparent, about a transgender father and his family, won eight Primetime Emmy Awards and created the buzz Amazon wanted to attract top producers and actors.

Yet Transparent lagged Amazon’s top shows in viewership.

Its first season drew a U.S. audience half as large as that of The Man in the High Castle, and it fell to 1.3 million viewers for its third season, according to the documents.

Similarly, Good Girls Revolt, a critically acclaimed show about gender inequality in a New York newsroom, had total U.S. viewership of 1.6 million but cost $81 million, with only 52,000 first streams worldwide by Prime members.

The program’s cost per new customer was about $1,560, according to the documents. Amazon canceled it after one season.

Amazon is now working on more commercial dramas and spin-offs with appeal outside the United States, where Prime membership has far more room to grow, people familiar with the matter said.

The effort to broaden Amazon’s lineup, long in the works, will be in the hands of Jennifer Salke, NBC Entertainment’s president whom Amazon hired last month as its studio chief.

Amazon’s Bezos has wanted a drama to rival HBO’s global hit Game of Thrones, according to the people.

In November, Amazon announced it will make a prequel to the fantasy hit The Lord of the Rings. The company had offered $250 million for the rights alone; production and marketing could raise costs to $500 million or more for two seasons, one of the people said.

At half a billion dollars, the prequel would cost triple what Amazon paid for The Man in the High Castle seasons one and two, the documents show. That means it would need to draw three times the number of Prime members as The Man in the High Castle for an equal payoff.

Washington State Directive Aims to Help Endangered Orcas

With the number of endangered Puget Sound orcas at a 30-year low, Washington Gov. Jay Inslee on Wednesday signed an executive order directing state agencies to take immediate and longer-term steps to protect the struggling whales.

The fish-eating mammals, also known as killer whales, that spend time in Puget Sound have struggled for years because of lack of food, pollution, noise and disturbances from vessel traffic. There are now just 76, down from 98 in 1995. 

Inslee said the orcas are in trouble and called on everyone in the state to do their part. His directive aims to make more salmon available to the whales, give them more space and quieter waters, make sure they have clean water to swim in and protect them from potential oil spills.

“The destiny of salmon and orca and we humans are intertwined,” the governor said at a news conference at the Daybreak Star Cultural Center in Seattle. “As the orca go, so go we.” 

An orca task force forming now will meet for the first time next month and will come up with a final report with recommendations by November. 

“This is a wake-up call,” said Suquamish Tribal Chairman Leonard Forsman, adding: “It’s going to take some pain. We’re going to have to make some sacrifices.”

Many people have been sounding the alarm about the plight of the closely tracked southern resident killer whales for years. The federal government listed the orcas as endangered in 2005, and more recently identified them as among the most at risk of extinction in the near future.

A baby orca has not been born in the past few years. Half of the calves born during a celebrated baby boom several years ago have died. Female orcas are also having pregnancy problems linked to nutritional stress brought on by a low supply of chinook salmon, the whales’ preferred food, a recent study found.

“We are not too late,” said Barry Thom, west coast regional administrator for NOAA Fisheries. “From a biology perspective, there are still enough breeding animals, but we need to act soon.”

Whale advocates welcomed the statewide initiative, saying it creates urgency and calls attention to the issue. But some also said it was long overdue.

“I think that everybody would have loved to have seen this five years ago,” said Joe Gaydos, science director for the SeaDoc Society. “It is a crisis. The fact that we’re responding is good.”

Under the order, state agencies will find ways to quiet state ferries around the whales, train more commercial whale-watching boats to help respond to oil spills and adjust fishing regulations to protect key areas and fish runs for orcas.

Orcas use clicks, calls and other sounds to navigate, communicate and forage mainly for salmon. Noise from vessels can interfere with that. 

The Legislature passed a supplemental budget Friday that includes $1.5 million for efforts such as increased marine patrols to see that boats keep their distance from the orcas and to boost hatchery production of salmon that the orcas prefer to eat by an additional five million.

Last year, the endangered orcas spent the fewest number of days in the central Salish Sea in four decades, mostly because there wasn’t enough salmon to eat, according to the Center for Whale Research, which keeps the whale census for the federal government.

“I applaud anything that helps (the orcas) through the short term, but the long term is what we really have to look at – and that’s the restoration of wild salmon stocks throughout Washington state,” Ken Balcomb, senior scientist with the Center for Whale Research, said Tuesday. 

Balcomb and others say aggressive measures are needed and they have called for the removal of four dams on the Lower Snake River to restore those salmon runs. 

J.T. Austin, the governor’s senior policy adviser on natural resources issues, said Inslee thus far does not support removing those dams. 

 

Senate Passes Bill That Eases Bank Reform Rules

The U.S. Senate voted 67 to 31 Wednesday to ease bank rules, bringing Congress a step closer to passing the first rewrite of the Dodd-Frank reform law enacted after the 2007-2009 global financial crisis.

The draft legislation now heads to the U.S. House of Representatives where Republicans in the majority say they want to add more provisions to ease financial regulations. Those changes have some of the bill’s backers worried that late alterations could upend the deal struck in the Senate between Republicans and Democrats.

The bill would ease tight restrictions on small banks and community lenders, and includes provisions beneficial to all but the largest U.S. banks.

The measure marks the first significant rewrite of financial rules since the passage of the 2010 Dodd-Frank financial reform law. The White House said in a statement that President Donald Trump would sign the bill into law if approved by the House.

GOP: Dodd-Frank too much

Republican critics say Dodd-Frank went too far and curbs banks ability to lend, while many Democrats say it provides critical protections for consumers and taxpayers.

The bill would raise the threshold at which banks are considered systemically risky and subject to stricter oversight from $50 billion to $250 billion. It also exempts banks with less than $10 billion in assets from rules banning proprietary trading, as well as exempts smaller banks from several other post-crisis rules.

The bill would allow custody banks such as BNY Mellon and State Street Corp to exempt the customer deposits they place with central banks from a stringent capital calculation requirement.

In House, 30 bills

In the House, conservative Republicans say they want to expand the bill to include additional regulatory relief, identifying roughly 30 bills they have passed for inclusion. But that insistence has some of the bill’s supporters concerned it could disrupt the bipartisan support it needs to become law.

“To expect that the House would have a desire to have some fingerprints on this final product is more than reasonable,” said Representative Bill Huizenga, a Michigan Republican, who wants additions to the bill.

Any changes made in the House would again have to pass the Senate, and Republican additions could drive away Senate Democrats whose support is needed for passage.

“There’s no guarantee that a modified bill would be able to pass the Senate,” said Paul Merski, executive vice president with the Independent Community Bankers of America, which supports the Senate bill. “That’s a real danger.”

U.N. Climate Projects in Congo Leave Locals Worse Off, Report Says

A large-scale United Nations program to halt deforestation in the Democratic Republic of Congo, home to the world’s second-largest rainforest, is harming local communities and failing to protect forests, land rights researchers said on Wednesday.

The U.S.-based group Rights and Resources Initiative (RRI) called on the World Bank to withhold funding from 20 current or pending projects in the province of Mai-Ndombe, which has been a test case for a U.N.-backed conservation scheme known as REDD+.

In an area rife with land conflict, an RRI report said the forest protection projects in this western province threatened the rights and incomes of rural women and indigenous groups, including about 73,000 pygmies.

“REDD+ was created to both halt deforestation and benefit local communities — yet the current projects in Mai-Ndombe fail to address both objectives,” said Marine Gauthier, the report’s author.

A spokesman for the U.N.’s REDD+ program did not respond to requests for comment.

One of the focal cases involves U.S. company Wildlife Works Carbon (WWC), which denied the accusations.

The company obtained a large land concession in order to protect a forest from loggers, and uses a share of the money earned from selling carbon credits to benefit people living there, said president Mike Korchinsky.

“Millions of dollars of benefits have gone to the communities,” he told the Thomson Reuters Foundation. He said WWC had built schools, invested in medical clinics, and provided years of agricultural support.

But Gauthier said local communities, which signed agreements with the company, were not properly consulted, and claimed the project had hindered their farming and other activities.

“These communities actually bear the burden of reducing deforestation,” she said.

The World Bank said the funding provided by REDD+ and its partners supported some of the poorest Congolese citizens, while contributing to meeting climate goals.

“We will review the report’s findings and have no plans to withhold funding at this time,” a World Bank spokesperson said in emailed comments.

“The work improves livelihoods, lessens pressure on native forests and reduces emissions of greenhouse gases from deforestation and forest degradation,” the World Bank said. RRI said women and minorities had been worst affected by the REDD+ projects that were up and running, because they often lack formal land rights and are not consulted about decisions.

REDD+, or reduced emissions from deforestation and degradation, was one of the solutions to climate change laid out in the 2015 Paris accord. It offers monetary incentives to scale back deforestation.

Congo could become the first country to sign a REDD+ deal with the World Bank this year, setting an example for more than 50 developing countries that plan to follow suit, said RRI.

However, it warned that deal could exacerbate conflict and set a dangerous global precedent if changes were not made. RRI said it had shared the results and that discussions with donors were underway.

Report: China Winning War on Smog, Will Step Up Efforts

Eastern China’s Jiangsu province will step up its war on pollution and focus on “high-quality development” following a spike in smog early this year, the China Daily reported, citing the provincial governor.

The province of Jiangsu is a major part of the Yangtze river delta manufacturing hub. Concentrations of breathable smog particles known as PM2.5 soared 20 percent in the region in January.

Jiangsu’s major heavy industrial center, Xuzhou, was also ranked China’s smoggiest city in December 2017, after a winter campaign to cut emissions in northern China led to a significant drop in PM2.5 concentrations in traditional smog zones.

Governor Wu Zhenglong promised “stricter strategies with higher standards” to control emissions, China Daily said.

Despite the January spike, average PM2.5 concentrations in the province still fell from 73 micrograms to 49 micrograms last year, the report added.

Late last month, an environment ministry official urged regions in the Yangtze delta and elsewhere to take responsibility for their air quality problems.

The Energy Policy Institute at the University of Chicago (EPIC), said in a report this week that China was winning its war on pollution after cutting average PM2.5 concentrations by 32 percent in just four years.

“The available evidence from our monitoring data indicate that pollution has decreased nearly across the board,” said Michael Greenstone, director of EPIC. “We estimate that just 4 percent of the 900 million residents covered by the monitor network saw pollution rise in their prefecture between 2013 and 2017,” he added.

10 Wolves Killed in Northern Idaho to Boost Elk Numbers

Federal officials have killed 10 wolves in northern Idaho at the request of the Idaho Department of Fish and Game to boost elk numbers, and state officials say more might be killed this winter.

The U.S. Department of Agriculture’s Wildlife Services said Wednesday that workers used a helicopter in the Clearwater National Forest in late February and early March to kill the wolves.

“At the request of Idaho, we did remove wolves in that region,” said agency spokeswoman Tanya Espinosa.

Idaho officials say the area’s elk population in what’s called the Lolo zone has plummeted in the last 25 years from about 16,000 to about 2,000, and that wolves are to blame along with black bears, mountain lions and a habitat transition to more forests.

Fish and Game has liberal harvest rules for bears and mountain lions, but wolves are more challenging to hunt. So in six of the last seven years, Fish and Game has sought to kill wolves to boost elk. Elk are a prominent big game species in Idaho and hunters have decried a scarcity of elk in the region. Elk are also a source of revenue through hunting license sales for Fish and Game.

“We’ve made an obligation to try to manage this elk herd at levels at maybe not peak levels, but at least bring it back to levels that we’ve seen in the past that were adequate for hunting,” said Jim Hayden, a biologist with Fish and Game.

Officials say Fish and Game license dollars paid for the federal agency to kill the wolves. State and federal officials didn’t have the cost immediately available.

Environmental groups blasted the killing of the wolves, focusing on the operation being made public only after it happened.

“Now more than ever, Wildlife Services and the Idaho Department of Fish and Game need to be up front with the public about their plans to kill wolves,” said Andrea Santarsiere, an attorney with the Center for Biological Diversity. “Idaho stopped monitoring wolves last year and stopped releasing annual reports revealing how many wolves remain in Idaho. It’s troubling to see this ever-increasing veil of secrecy fall over the management of Idaho’s wolves.”

The last intensive wolf count in Idaho was in 2015 when officials said the state had an estimated 786 wolves at the end of the year. That’s also the last year Fish and Game was required to do that type of count after wolves were removed from the Endangered Species List.

But Fish and Game has continued to monitor wolf populations. Hayden said that based on DNA samples from more than 700 wolf droppings, nearly 150 remote cameras and other information, at least 11 packs are in the Lolo zone. Hayden said the agency manages populations and doesn’t count individuals. But he said an Idaho wolf pack typically has six to nine wolves. That means there are roughly 65 to 100 wolves in the Lolo zone. 

Fish and Game estimates that statewide there are more than 90 packs, Hayden said, far above the state’s minimum requirement of 15 packs. The federal government could take back management of Idaho wolves if the population gets too low.

Hayden said the state and federal agencies do not announce wolf-kill operations out of concern for the safety of the helicopter crew as well as the last-minute nature of the operations. He said a snowy day must be followed by clear flying weather, and there’s a chance that if those conditions occur again this winter federal workers will try to kill more wolves in the Lolo zone.

“After you go after the first one, the wolves are scattering, so it’s not common to take a whole pack,” he said.

Reports: Toys ‘R’ Us to Shut or Sell All US Stores

Toys ‘R’ US plans to sell or close all of its US stores, potentially hitting 33,000 jobs, U.S. media reported Wednesday.

The debt-plagued retailer, which filed for bankruptcy protection in September, told employees that the retailer planned to file liquidation papers ahead of a Thursday court hearing, The Wall Street Journal and The Washington Post reported.

“We’re putting a for sale sign on everything,” CEO David Brandon said on a conference call with staff, according to the Journal.

Company officials did not immediately reply for a request for comment.

Started in 1948 amid the postwar US economic boom, Toys ‘R’ US has 881 stores in U.S. territories and nearly 65,000 employees globally, according to the company’s most recent press release last month.

The New Jersey-based company was saddled with debt following a leveraged buyout in 2005 by a consortium that included the KKR Group and Bain Capital.

Much like other retailers, Toys ‘R’ Us has also been bruised by competition from Amazon and other online retailers.

A weak holiday shopping season weighed on the company’s efforts to reorganize, analysts said.

Neil Saunders, managing director of GlobalData Retail, blamed the company’s woes on poor leadership.

“As the competitive dynamics of the toy market intensified, management failed to respond and evolve. As such, the brand lost relevance, customers and ultimately sales,” Saunders said in a note Wednesday.

“The main tragedy of liquidation will be the extensive loss of jobs. In our view, those on the shop-floor have been badly let down by management and those doing financial deals.”

The company is exploring strategies for keeping the brand alive, including the sale of 200 U.S. stores that could be packaged with its Canadian business, CNBC and the Journal reported.

Brandon outlined this and other possibilities at the New Jersey meeting, CNBC reported. Brandon also told workers they have 60 more days of employment at the company.

In February, the company’s British business announced plans for an “orderly wind-down” of the company’s store portfolio. Toys ‘R’ Us employs 3,200 people at 100 stores in Britain.

 

‘Panama Papers’ Law Firm to Shut Down After Tax Scandal

Mossack Fonseca, the Panamanian law firm at the center of the “Panama Papers” scandal, said Wednesday that it was shutting down because of the damage to its business and reputation inflicted by role in the global tax evasion debacle.

The Panama Papers, which consist of millions of documents stolen from Mossack Fonseca and leaked to the media in April 2016, provoked a global scandal after showing how the rich and powerful used offshore corporations to evade taxes.

“The reputational deterioration, the media campaign, the financial circus and the unusual actions by certain Panamanian authorities have occasioned an irreversible damage that necessitates the obligatory ceasing of public operations at the end of the current month,” the firm said in a statement.

Mossack Fonseca said a skeleton staff would remain in order to comply with requests from authorities and other public and private groups.

Nonetheless, the law firm said it would continue “fighting for justice,” adding it would also continue to cooperate with authorities.

Last month, Panamanian prosecutors raided the offices of Mossack Fonseca, seeking possible links to Brazilian engineering company Odebrecht. The Brazilian construction firm has admitted bribing officials in Panama and other countries to obtain contracts in the region between 2010 and 2014.

Ramon Fonseca, a partner at Mossack Fonseca, denied last month that his firm had a connection to Odebrecht, while accusing Panamanian President Juan Carlos Varela of directly receiving money from Odebrecht, Latin America’s largest engineering company.

Varela has denied taking any money from Odebrecht.

White House: US Pressing China to Cut Trade Surplus by $100B

The Trump administration is pressing China to cut its trade surplus with the United States by $100 billion, a White House spokeswoman said Wednesday, clarifying a tweet last week from President Donald Trump.

Last Wednesday, Trump tweeted that China had been asked to develop a plan to reduce its trade imbalance with the United States by $1 billion, but the spokeswoman said Trump had meant to say $100 billion.

The United States had a record $375 billion trade deficit with China in 2017, which made up two-thirds of a global $566 billion U.S. trade gap last year, according to U.S. Census Bureau data.

China reported its 2017 U.S. trade surplus as $276 billion, also about two-thirds of its reported global surplus of $422.5 billion.

The White House spokeswoman declined to provide details about how the administration would like China to accomplish the surplus-cutting goal — whether increased purchases of U.S. products such as soybeans or aircraft would suffice, or whether it wants China to make major changes to its industrial policies, cut subsidies to state-owned enterprises, or further reduce steel and aluminum capacity.

The request comes as the Trump administration is said to be preparing tariffs on imports of up to $60 billion worth of Chinese information technology, telecoms and consumer products as part of a U.S. investigation into China’s intellectual property practices.

It is also unclear if the requested $100 billion reduction would address U.S. complaints about China’s investment policies that effectively require U.S. firms to transfer technology to Chinese joint venture partners in order to gain market access.

The issue is a core part of the probe being conducted under Section 301 of the Trade Act of 1974, a provision seldom invoked since the World Trade Organization was founded in 1995. Trade experts have said tariffs imposed as a result of the China intellectual property probe may fall outside of WTO rules.

U.S. targets Indian subsidies

But Washington showed on Wednesday that it has not abandoned the global trade body, launching a WTO legal challenge to India’s export subsidies for domestic companies, including producers of steel, chemicals, pharmaceuticals, textiles and IT products.

U.S. Trade Representative Robert Lighthizer said India had failed to remove the subsidies as required by WTO rules after the country reached certain economic benchmarks.

The United States is expected to invoke a national security exception to WTO rules in imposing import tariffs of 25 percent on steel and 10 percent on aluminum announced by Trump last week.

U.S. Commerce Secretary Wilbur Ross told lawmakers on Wednesday his department would soon publish procedures for product-specific exemptions from the steel tariffs for items that are not available from domestic producers or in short supply. The procedures are due by Sunday.

Anne Forristall Luke, president of the U.S. Tire Manufacturers Association, said the group would be “pressing very hard” for an exemption from tariffs for high-strength wire rod used to make cord for steel tire belts that is not produced by U.S. mills.

The largest sources for the material are Japan and Brazil, she said, adding that U.S. tire producers will lose business to foreign competitors if their steel costs rise.

“We are working this from the product side and the country side. We think we have a very good case,” she told Reuters.

France to Fine Google, Apple Amid Broader Transatlantic Spat

France added more kindling to a growing commercial dispute between Europe and the United States, announcing Wednesday it would sue American tech giants Google and Apple over allegedly abusive business practices.

After peanut butter, cranberries and bourbon, Google and Apple are the latest American icons in Europe’s crosshairs. Speaking to French radio Wednesday, French Economy Minister Bruno Le Maire accused the two U.S. companies of unilaterally imposing prices and other terms on French startups.

Google and Apple may be powerful, Le Maire said, but they should not be able to treat French startups and developers the way they currently do.

France has taken legal action against the companies before. But this latest dispute comes amid a potential trade war, as Washington prepares to slap tariffs against steel and aluminum imports.

The European Union has vowed countermeasures on products such as peanut butter if the bloc is not exempted from the U.S. measures, which may take effect next week. But European Trade Commissioner Cecilia Malmstrom told the EU Parliament Wednesday she hopes that will not happen.

“As long as the measures have not entered into force, we hope to avoid a significant trade dispute,” she said. “The root problem, as many of you have said, is overcapacity in steel and aluminum sectors.”

Malmstrom said the European Union and the United States should instead work together to end unfair subsidies by some countries and level the trading field.

France has a mixed relationship with U.S. internet companies — both encouraging them to invest here, but also to pay more EU taxes — as it tries to build its home-grown industry.

Last year, it also threatened fines against Amazon for allegedly abusing its dominant position with suppliers. French justice has yet to rule on the case.

Microsoft Finds Few Gender Discrimination Complaints Valid

Only one of 118 gender discrimination complaints made by women at Microsoft was found to have merit, according to unsealed court documents.

The Seattle Times reports the records made public Monday illustrate the scope of complaints from female employees in technical jobs in the U.S. between 2010 and 2016.

And according to the court documents, Microsoft’s internal investigations determined only one of those complaints was “founded.”

The documents were released as part of an ongoing lawsuit by three current or former Microsoft employees alleging gender discrimination.

The plaintiffs are seeking class-action status for the case, claiming more than 8,600 women collectively lost out on $238 million in pay and 500 promotions because of discrimination in the company’s performance review process.

Microsoft’s case is one of several against giant companies in the technology industry, which has been criticized in recent years for its lack of female and minority employees and for a workplace culture that some say is hostile toward those groups.

The plaintiffs argue that men in similar roles with similar job performance were promoted faster and given more raises than their female colleagues.

Microsoft has said a class action isn’t warranted because there is no common cause for the employees’ complaints and plaintiffs have not identified systemic gender discrimination. The company has denied that systemic bias is taking place through its employee-review process.

In court documents, Microsoft also has stood behind its internal investigative process, which involves a four-person team that looks into each complaint filed with the company. In a statement Tuesday, a Microsoft said all employee concerns are taken seriously and that the company has a “fair and robust system in place” to investigate them.

U.S. District Judge James Robart is hearing the case in U.S. District Court in Seattle and is expected to decide on the class-action request in the next several months.

Information from: The Seattle Times.

China’s Huawei Says to Keep Investing in US Despite Setback

Chinese telecoms giant Huawei says it will continue to invest in the United States despite recent setbacks in its efforts to boost sales there.

Xu Qingsong, also known as Jim Xu, Huawei’s head of sales and marketing, told reporters in Shenzhen he was “confident” Huawei smartphone sales would triple this year in the U.S. from last year.

News reports in January said Huawei appeared to be on the verge of cracking the lucrative American market when it signed a deal with AT&T, but the agreement fell through under U.S. government pressure.

In the past, Huawei officials have rejected U.S. security complaints as politically motivated or possibly an attempt by competitors to keep it out of the market.

“I don’t know why they’re so nervous,” Xu said Tuesday, referring to the U.S. “They’re too nervous.”

Huawei sells some models in U.S. electronics stores and online but has a minimal share of an American market in which most sales are through carriers. Globally, the company trails Samsung and Apple in handset shipments but leads in China, the biggest market, and says it expects to ship a total of 150 million this year.

Huawei, the world’s biggest maker of network gear used by phone companies, suffered earlier setbacks in the American market when a congressional report in October 2013 said it was a security risk and warned telecom carriers not to use its equipment.

More recently, a new global struggle for influence over next-generation “5G” communications technology has brought Huawei under increasing scrutiny by the U.S. government. Many American officials are concerned Chinese companies such as Huawei could take a larger, or even a dominant, role in setting 5G technology and standards and practices.

Kevin Ho, president of Huawei’s handset product line, said they’ll instead focus on Europe and developing markets in Asia, especially India, where Huawei sees opportunities to expand the Shenzhen-based company’s market share.

“There are still some big countries where our market share is very, very low,” Ho said. “This is a hint of where we can raise our market share globally.”

On Tuesday, U.S. President Donald Trump blocked Singapore chipmaker Broadcom from pursuing a hostile takeover of prominent U.S. rival Qualcomm, a deal which officials believed could have hobbled the U.S.’s ability to make a quick transition to 5G.

When asked about the blocked deal, Xu declined to comment.

Separately, lawmakers in the U.S. House of Representatives introduced a bill on January 9 that would prohibit government purchases of telecoms equipment from Huawei Technologies and smaller rival ZTE, citing their ties to the Chinese military and backing from the ruling Communist Party.

At SXSW Africans Are Networking with Other Africans

South by Southwest (SXSW) is not just an annual music festival and tech conference in Austin, Texas, it also includes venues where people from specific countries or regions of the world can gather to share ideas. This is the inaugural year for Africa House at South by Southwest, and it’s providing valuable networking opportunities for Africans who come to experience and benefit from this eclectic festival. VOA’s Elizabeth Lee reports from Austin.

Africans Travel to SXSW in Texas to Network With Each Other

Brenda Katwesigye traveled thousands of kilometers from Uganda in eastern Africa to Austin, Texas with a vision. She wants to find help for Wazi Vision, the startup that she founded in 2016 to make eyeglasses more affordable. Katwesigye’s company, named for the Swahili word that means “clear,” says Wazi Vision makes the frames from recycled plastic and that they cost 80 percent less than what is currently on the market. 

“We need people that are here that can sell them in their stores. We need people with online e-commerce platforms that can help with logistics and everything,” she said.

Katwesigye hopes to find these partners at South by Southwest (SXSW), the music and film festival and tech conference held in Austin in the spring every year. Her home away from home at the event is Africa House, a venue where Africans can meet members of the diaspora in the United States and other Africans from Africa. 

“It’s quite incredible. We’ve traveled all the way from Africa to meet Africa here and to meet people that we otherwise would never have had a chance to meet back home.” Katwesigye added, “I’ve met some really meaningful contacts that I plan on following up on.”

Her trip would not be possible without the help of the United States African Development Foundation (USADF), which funded her travel.

“It’s a global environment. These are people here again, who are artisans and who are tech entrepreneurs and who are people who are really social change makers in the U.S. who want to meet African counterparts,” said C.D. Glin, president of USADF.

U.S.-born Bunmi Akinyemiju grew up in Nigeria, went to college in the U.S. and returned to Nigeria to become managing director and chief executive officer of Lagos-based Venture Garden Group, a payment and data analytics company.

“We look for new technologies. We look for new startups, so while we look for startups, that allows us to actually make investments in those startups that can collaborate with our parent company,” said Akinyemiju.

USADF and two other organizations have joined forces to sponsor the first Africa House at SXSW this year. The other two are U.S. public relations firm Insider, which works with emerging market entrepreneurs, and Temple Management Company, a talent and events management agency based in Lagos, Nigeria.

“Really to be able to showcase Africans and their social enterprises to the community at South by Southwest was something we felt like was a must do this year,” said Glin.

Azariah Mengistu is making a premium handcrafted leather sneaker in Ethiopia, in part to change Africa’s image abroad.

“We want everyone to challenge global perceptions of what people thought when they saw Africa. So we want people to engage with the product, something physical that was made with the best quality at the best standards with the best materials. We wanted it all to be done in Africa.”

For Nigerian musician 9ice, Africa House is a venue “to network. It is to make more fans.” 

Glin says that while this is the first Africa House at South by Southwest – it won’t be the last.

Doctors Hunt for Hidden Cancers with Glowing Dyes

It was an ordinary surgery to remove a tumor – until doctors turned off the lights and the patient’s chest started to glow. A spot over his heart shined purplish pink. Another shimmered in a lung. 

They were hidden cancers revealed by fluorescent dye, an advance that soon may transform how hundreds of thousands of operations are done each year. 

Surgery has long been the best way to cure cancer. If the disease recurs, it’s usually because stray tumor cells were left behind or others lurked undetected. Yet there’s no good way for surgeons to tell what is cancer and what is not. They look and feel for defects, but good and bad tissue often seem the same.

Now, dyes are being tested to make cancer cells light up so doctors can cut them out and give patients a better shot at survival.

With dyes, “it’s almost like we have bionic vision,” said Dr. Sunil Singhal at the University of Pennsylvania. “We can be sure we’re not taking too much or too little.” 

The dyes are experimental but advancing quickly. Two are in late-stage studies aimed at winning Food and Drug Administration approval. Johnson & Johnson just invested $40 million in one, and federal grants support some of the work. 

“We think this is so important. Patients’ lives will be improved by this,” said Paula Jacobs, an imaging expert at the National Cancer Institute. In five or so years, “there will be a palette of these,” she predicts.

Making cells glow

Singhal was inspired a decade ago, while pondering a student who died when her lung cancer recurred soon after he thought he had removed it all. He was lying next to his baby, gazing at fluorescent decals.

“I looked up and saw all these stars on the ceiling and I thought, how cool if we could make cells light up” so people wouldn’t die from unseen tumors, he said. 

A dye called ICG had long been used for various medical purposes. Singhal found that when big doses were given by IV a day before surgery, it collected in cancer cells and glowed when exposed to near infrared light. He dubbed it TumorGlow and has been testing it for lung, brain and other tumor types.

He used it on Ryan Ciccozzi, a 45-year-old highway worker and father of four from Deptford, New Jersey, and found hidden cancer near Ciccozzi’s heart and in a lung.

“The tumor was kind of growing into everything in there,” Ciccozzi said. “Without the dye, I don’t think they would have seen anything” besides the baseball-sized mass visible on CT scans ahead of time.

Singhal also is testing a dye for On Target Laboratories, based in the Purdue research park in Indiana, that binds to a protein more common in cancer cells. A late-stage study is underway for ovarian cancer and a mid-stage one for lung cancer.

In one study, the dye highlighted 56 of 59 lung cancers seen on scans before surgery, plus nine more that weren’t visible ahead of time. 

Each year, about 80,000 Americans have surgery for suspicious lung spots. If a dye can show that cancer is confined to a small node, surgeons can remove a wedge instead of a whole lobe and preserve more breathing capacity, said On Target chief Marty Low. No price has been set, but dyes are cheap to make and the cost should fit within rates hospitals negotiate with insurers for these operations, he said. 

Big promise for breast cancer

Dyes may hold the most promise for breast cancer, said the American Cancer Society’s Dr. Len Lichtenfeld. Up to one third of women who have a lump removed need a second operation because margins weren’t clear – an edge of the removed tissue later was found to harbor cancer. 

“If we drop that down into single digits, the impact is huge,” said Kelly Londy, who heads Lumicell, a suburban Boston company testing a dye paired with a device to scan the lump cavity for stray cancer cells.

A device called MarginProbe is sold now, but it uses different technology to examine the surface of tissue that’s been taken out, so it can’t pinpoint in the breast where residual disease lurks, said Dr. Barbara Smith, a breast surgeon at Massachusetts General Hospital. 

She leads a late-stage study of Lumicell’s system in 400 breast cancer patients. In an earlier study of 60 women, it revealed all of the cancers, verified by tissue tests later. 

But it also gave false alarms in more than a quarter of cases – “there were some areas where normal tissue lit up a little bit,” Smith said.

Still, she said, “you would rather take a little extra tissue with the first surgery rather than missing something and have to go back.”

Other cancers 

Blaze Bioscience is testing Tumor Paint, patented by company co-founder Dr. Jim Olson of Fred Hutchinson Cancer Research Center and Seattle Children’s Hospital. It’s a combo product – a molecule that binds to cancer and a dye to make it glow.

“You can see it down to a few dozen cells or a few hundred cells,” Olson said. “I’ve seen neurosurgeons come out of the operating room with a big smile on their face because they can see the cancer very clearly.”

Early-stage studies have been done for skin, brain and breast cancers in adults, and brain tumors in children. 

Avelas Biosciences of San Diego has a similar approach – a dye attached to a molecule to carry it into tumor cells. The company is finishing early studies in breast cancer and plans more for colon, head and neck, ovarian and other types.

Cancer drugs have had a lot of attention while ways to improve surgery have had far less, said company president Carmine Stengone.

“This was just an overlooked area, despite the high medical need.”

Theoretical Physicist Stephen Hawking Dies at 76

World-renowned British physicist Stephen Hawking, who sought to understand a range of cosmic topics from the beginning of the universe to the intricacies of black holes, died Wednesday at the age of 76.

A family spokesman said he died peacefully at his home in the city of Cambridge where he worked for decades as the Lucasian Professorship of Mathematics at the University of Cambridge.

“He was a great scientist and an extraordinary man whose work and legacy will live on for many years,” Hawking’s children, Lucy, Robert and Tim, said in a statement.

He was diagnosed with amyotrophic lateral sclerosis at the age of 21, a disease that eventually confined him to a wheelchair and took away this ability to speak, leaving Hawking to communicate through a voice synthesizer.

Doctors predicted he would only live a few years, but he instead thrived, focusing on his work that included seeking to bridge the gap between Albert Einstein’s General Theory of Relativity that describes the motion of large objects and the Theory of Quantum Mechanics dealing with subatomic particles.

“My goal is simple. It is a complete understanding of the universe, why it is as it is and why it exists at all,” Hawking said.

His 1988 book “A Brief History of Time” became an international bestseller and brought him widespread fame.

One of his most famous accomplishments came in his research on black holes, showing that small amounts of radiation could escape their gravitational pull. The phenomenon is now commonly known as Hawking radiation.

A sign of his popularity came in October when Cambridge put Hawking’s 1966 thesis online for the first time, and demand for the document was so high the university’s website crashed.

Hawking was also a proponent of human space travel to the Moon and Mars, an endeavor he said would help unite humanity in the shared purpose of spreading beyond Earth.

Hawking said making the first moves into space would “elevate humanity” because it would have to involve many countries.

“We are running out of space and the only places to go to are other worlds. It is time to explore other solar systems. Spreading out may be the only thing that saves us from ourselves. I am convinced that humans need to leave Earth,” he said last year. “If humanity is to continue for another million years, our future lies in boldly going where no one else has gone before.”

Futuristic Tire Fights Pollution and Produces Oxygen

Hundreds of exhibitors are showcasing their latest innovations at this year’s Geneva International Motor Show. Among the participants at the annual event which runs until March 18, 2018 is Goodyear, which introduced a new concept tire which literally cleans the air as you drive. As Faiza Elmasry tells us, Goodyear’s eco-friendly invention runs on living moss and has the added benefit of reducing airborne pollution. VOA’s Faith Lapidus narrates.

For Poor Venezuelans, a Box of Food May Sway Vote for Maduro

A bag of rice on a hungry family’s kitchen table could be the key to Nicolas Maduro retaining the support of poor Venezuelans in May’s presidential election.

For millions of Venezuelans suffering an unprecedented economic crisis, a monthly handout of a box of heavily-subsidized basic food supplies by Maduro’s unpopular government has offered a tenuous lifeline in their once-prosperous OPEC nation.

The 55-year-old successor to Hugo Chavez introduced the so-called CLAP boxes in 2016 in a signature policy of his rule, continuing the socialist government’s strategy of seeking public support with cash bonuses and other giveaways.

Now, running for re-election on May 20, Maduro says the CLAPs are his “most powerful weapon” to combat an “economic war” being waged by Washington, which brands him a “dictator” and has imposed sanctions.

Mariana, a single mother who lives in the poor hillside neighborhood of Petare in the capital Caracas, says the handouts will decide her vote.

“I and other women I know are going to vote for Maduro because he’s promising to keep giving CLAPs, which at least help fix some problems,” said the 30-year-old cook, who asked not to give her surname for fear of losing the benefit.

“When you earn minimum wage, which doesn’t cover exorbitant prices, the box helps.”

Maduro’s rule since 2013 has coincided with a deep recession caused by a plunge in global oil prices and failed state-led economic policies.

Yet the worse the economy gets, the more dependent some poor Venezuelans become on the state.

Life in the South American country’s poor ‘barrios’ revolves around the CLAP boxes. According to the government, six million families receive the benefit, from a population of around 30 million people.

Venezuelans, many of whom are undernourished, anxiously wait for their monthly delivery, and a thriving black market has sprung up to sell CLAP products.

The government sources almost all the CLAP goods from abroad, especially from Mexico, since Venezuela’s food production has shriveled and currency controls restrict private imports.

Critics, including Maduro’s main challenger for the May 20 vote, Henri Falcon, say the CLAPs are a cynical form of political patronage and are rife with corruption.

Erratic supply and control of distribution by government-affiliated groups have sown resentment among others.

“I can’t count on it. Sometimes it comes, sometimes not,” said Viviana Colmenares, 24, an unemployed mother of six struggling to get by in Petare.

“Instrument of the Revolution”

Stamped with the faces of Maduro and Chavez, the CLAP boxes usually contain rice, pasta, grains, cooking oil, powdered milk, canned tuna and other basic goods. Recipients pay 25,000 bolivars per box, or about $0.12 at the black market rate.

That is a godsend in a country where the minimum monthly wage is less than $2 at that rate – and would be swallowed up by two boxes of eggs or a small tin of powdered milk.

Inflation, at more than 4,000 percent annually according to opposition data, is pulverizing household income.

The administration of the CLAP — the Local Supply and Production Committees — does not hide its political motivation.

“The CLAPs are here to stay. They are an instrument of the revolution,” said Freddy Bernal, CLAP chief administrator.

“It has helped us stop a social explosion and enabled us to win elections and to keep winning them,” he told Reuters, referring to government victories in 2017 local polls.

Sometimes, though, the tactic backfires, as it did when promised free pork failed to arrive over Christmas, prompting street protests.

Maduro’s inability to halt rising hunger has jarred with the experience of many under Chavez, who won the presidency in 1998 and improved Venezuela’s social indicators with oil-fueled welfare policies.

Even though Maduro’s approval rating is only around 26 percent, according to one recent poll, his re-election looks likely as Venezuela’s opposition coalition is boycotting the vote on accusations it is rigged.

His most popular rivals are banned from standing and the election board favors the government.

Former state governor Falcon has broken with the coalition to stand. One survey by pollster Datanalisis in February showed that in a two-way race, he would defeat Maduro by 45.8 percent to 32.2 percent of likely voters.

Falcon’s critics counter that those numbers mean nothing in the face of electoral irregularities that could arbitrarily tip the balance in favor of Maduro.

Several other minor figures have registered for the single-round election, but have little chance of making an impact.

‘Can’t Depend on the Box’

Juan Luis Hernandez, a food specialist at the Central University of Venezuela, estimates the country generates just 44 percent of the basic food supplies it produced in 2008.

Meanwhile, food imports fell 67 percent between the start of 2016 and the end of 2017 as the crisis bit, he said.

Almost two-thirds of Venezuelans surveyed in a university study published in February said they had lost on average 11 kilograms (24 lbs) in body weight last year. Eighty-seven percent were assessed to live in poverty.

The same study found that seven out of 10 Venezuelans had received CLAPs.

“They (the government) don’t care about the food issue, just about getting people something to eat while they get through the elections,” said Susana Raffalli, a consultant with charity Caritas.

Some Venezuelans fear they would be found out should they vote against Maduro and be punished by no longer receiving food bags.

Already handouts are far from guaranteed.

A dozen recipients told Reuters that often they arrived half-full and would only come every few months. Outside of the capital Caracas, delivery was even more sporadic.

“I can’t depend on the box, otherwise I would die from hunger,” said Yuni Perez, a 48-year-old rubbish collector and mother of three.

Perez, who lives in a ramshackle house made from breeze blocks and corrugated steel at the top of Petare, said a CLAP box provided her family with food for a week. Often they would receive one every two months.

When her family is short of food, she hunts for leftovers dumped on the side of Petare’s winding streets. She said she had found several newborn babies discarded in the gutter, which she attributed to mothers unable to face providing food for another child.

Another Petare resident, mother-of-three Yaneidy Guzman said she dropped from 68kg to 48kg last year, despite receiving the CLAP.

“At least for 10 days you don’t have to think about finding food,” the 32-year-old said of the handouts, her cheekbones protruding from her face.