YCLOAK

Large numbers of job seekers from around the world are filing applications at U.S. federal offices as the season opened Monday for H1-B visas for foreign workers.

H1-Bs allow employers – mostly high-tech firms – to hire skilled foreign workers for jobs in the United States for three years. Eighty-five thousand slots are available – 65,000 for applicants with bachelor’s degrees and 20,000 for those with master’s or more advanced degrees.

In recent years, there have been so many applications that the U.S. government stopped accepting them within a week. Visa winners are chosen by a computer-generated lottery.

This year, there is additional pressure because the program’s future is not clear.

President Donald Trump has vowed that he will not allow American workers to be displaced by foreigners holding H1-B visas.

On Monday, as the application process opened, the Department of Justice warned U.S. companies not to discriminate against American workers.

“U.S. workers should not be placed in a disfavored status, and the department is wholeheartedly committed to investigating and vigorously prosecuting these claims,” said Acting Assistant Attorney General Tom Wheeler of the Civil Rights Division.

At the same time, U.S. Citizenship and Immigration Services (USCIS) warned it will take a “more targeted approach” as it makes site inspections across the country.  What it will be targeting includes an inability to find an employer’s basic business information through commercially available data, employers who have a high ratio of H1-B employees to U.S. workers, and employers who petition for H1-B workers to work off-site.

Outsourcing

Overwhelmingly, India has been the biggest recipient of H1-B visas. The Department of Homeland Security (DHS) reports that 71 percent of H1-Bs went to Indians in 2015. China was a distant second with 10 percent of the visas.

India’s success is attributed to its huge outsourcing firms that submit thousands of applications every year, increasing their chances of winning the lottery. Outsourcing firms, which supply services to other companies, are controversial because they are not subject to a federal requirement that they not displace American workers if they pay the H1-Bs at least $60,000 a year.

The H1-B visa program has proponents who argue that there are not enough Americans to fill all the slots for which skilled workers are needed. A research brief filed Monday by the bipartisan group New American Economy said that there are “persistent and dramatic” worker shortages in science, technology, engineering and math.

The group of mayors and business leaders who support immigration reform said that in 2016, there were more than a dozen jobs posted in those fields for every one unemployed eligible U.S. worker.

Competing bills in the U.S. Congress both expand and curtail the H1-B visa program.

H1-B spouses

In the meantime, spouses of H1-B holders, who are allowed to work under a 2015 rule, are still in limbo regarding their eventual employment status.  

The Department of Justice, acting on behalf of the Department of Homeland Security, has asked for additional time to review the rule that allows spouses of H1-B visa holders to work.

Implemented under the administration of U.S. President Barack Obama, the rule has been challenged in court by Save Jobs USA, an organization of information technology workers who claim to have lost their jobs to H1-B visa holders. The group maintains that the rule threatens American jobs.

Before the rule, spouses, who hold H-4 visas, were not allowed to work.

In February, the DHS had asked for 60 days to review the rule. On Monday, that 60-day period closed and the Department of Justice requested a 180-day extension, promising to update the federal appeals court at 60 days.

Save Jobs USA filed a cross motion Monday asking that the additional time be denied.
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An innovator at Kenya’s Lake Victoria has turned an invasion of water hyacinth into a business opportunity, making paper from the weed that he sells in local shops. The initiative is creating jobs and supporting environmental sustainability.

Michael Otieno began making paper from water hyacinth ten years ago. The flowering weed is a nuisance to fishermen. It depletes fish stocks, affecting thousands of livelihoods.

Known as the ‘paper man’ by locals, Otieno has perfected his daily routine. Every morning, he goes into Lake Victoria to search for raw material. Once the hyacinth is harvested, it is cut into small pieces before being boiled to soften it.

Otieno started his Takawiri Initiative to provide income and jobs for locals.

According to the World Bank, Lake Victoria supports around 40 million people in East Africa, with nearly half of those residents living on less than $1.25 a day.

Otieno now employs up to 30 people, though the business has its challenges.

“One – is technology; the machines we are using are locally fabricated, and, two, we also, it’s a capital-intensive project, therefore it needs a lot of resources,” Otieno says.

Edward Orato, a local artists, runs a curio shop in Kisumu city on the banks of Lake Victoria. Since he started using the hyacinth paper, he hasn’t looked back.

“I like the paper since it’s not expensive. It’s also easily available. As an artist, I think it has a unique texture. The fibers give my paintings an edge. ”

The Takawiri Initiative got a start-up $60,000 grant from a Kenyan government agency tasked with environmental research and sustainability promotion. Joshua M’Anampiu, a top official with the National Environment Trust Fund (NETFUND), says assistance on the ground-level is important.

“Definitely, we understand the scarcity of finance or the inability of finance to trickle down to the people who really need it and that is why NETFUND is there, to ensure that even though there’s a lot of funding that is there for climate change, it must trickle down to the grassroots, to the people who really need it,” M’Anampiu says.

For Otieno and his staff, the water hyacinth is proving to be a blessing in disguise.
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Recent political turmoil in South Africa has come at a cost, with ratings agency S&P Global saying a controversial Cabinet reshuffle and growing pressure on the president to resign have lowered the country’s sovereign credit rating to “junk” status. Economists predict that will result in higher interest rates and higher prices on imported goods. It could, however, also give the South African leaders the opportunity to finally carry out their promise of radically transforming the economy away from minority ownership and toward a more equitable model.

The ratings agency did not mince words in its downgrade announcement, pinning the blame for South Africa’s poor credit rating squarely on controversial political decisions made by President Jacob Zuma.

On Tuesday, new Finance Minister Malusi Gigaba reassured the nation that under his leadership, South Africa’s economy would remain steady.

“We acknowledge that yesterday’s announcement was a setback. Despite our current challenges, now is not a time for despondency. We have many strengths that we can leverage to grow our economy inclusively,” said Gigaba.

News of the downgrade has sent the currency, the rand, tumbling. Top ratings agency Moody’s has also said it is considering downgrading South Africa, a move which will likely scare away international investors over fears that the nation won’t be able to honor its debts.

The latest dustup began last week, when the president suddenly announced sweeping changes to his Cabinet. The reshuffle included the dismissal of a well-regarded finance minister who had challenged the president, as well as several other ministers who openly called for Zuma to resign as he sank deeper in public opinion amid long-simmering corruption scandals.

The Cabinet changes were met with widespread disapproval — and not just from the usual suspects. In a rare break of party unity, Zuma’s own deputy president and the secretary-general of the party Zuma leads, the African National Congress, publicly criticized the reshuffle.

But, says associate economics professor Christopher Malikane of the University of the Witwatersrand, this downgrade could take pressure off South Africa to strive for the same financial policy goals as developed nations. South Africa’s history of oppression has left it with high levels of inequality, largely along racial lines, which is something the ANC has long vowed to address through a program of “radical economic transformation.”

This downgrade, Malikane said, could free up the government to do just that.

“The silver lining aspect of it, in my view, has to do with the fact that that this thing is now behind us. The leadership now has to be serious about articulating a clear program of transformation. If they had implemented this program anyway, they would have been downgraded because they would have tampered with the ownership structures that exist in the economy. Now that the downgrade has happened, I think it’s a green light for them to proceed and transform the economy in a radical way, but in a transparent and a well-articulated way so that investors know what concretely is going to happen going forward,” he said.

Political analyst Ralph Mathekga said he thinks Zuma and his supporters will dodge the fallout from this downgrade by simply reframing the argument.

“The ratings agencies are working on the paradigm that the ANC is beginning to reject openly, or at least some within the ANC. And by the end of the week you’re going to have to discuss, whether we like it or not, the discussion will be whether we should even worry about the ratings agencies,” he said.

The political turmoil is sure to continue. Zuma is facing growing clamor from the opposition for a no-confidence vote in parliament, which gained more momentum after the country’s top trade union coalition — a longtime ally of the ANC — said Tuesday that they, too, want him to resign.
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The U.S. plane maker Boeing said Tuesday it agreed to sell 30 of its 737 MAX jets to Iran’s Aseman Airlines, a deal worth $3 billion.

The sale marks the second such Boeing deal made possible by the 2015 nuclear agreement signed by former U.S. president Barack Obama to relieve sanctions on the Middle Eastern country.  IranAir struck a $16.6 billion deal with the company in December for 80 planes.

“Boeing confirms the signing of a Memorandum of Agreement with Iran Aseman Airlines, expressing the airline’s intent to purchase 30 Boeing 737 MAX airplanes with a list price value of $3 billion,” the plane maker said in a statement. “The agreement also provides the airline with purchase rights for 30 additional 737 MAXs.”

Aseman Airlines is scheduled to start receiving the aircraft in 2022, though the deal is still contingent on approval from the U.S. government.

The nuclear agreement limited Iran’s nuclear capabilities in exchange for the lifting of international economic sanctions. U.S. President Donald Trump heavily criticized the deal during his election campaign and has said he would like to see in renegotiated.

Aseman Airlines flies both domestic and international flights from Iran. The European Union banned the airline in December, citing safety concerns.

The deal is expected to create or sustain 18,000 jobs, Boeing said.

 
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South Korea’s Hyundai Motor Co. and Kia Motors Corp. have slashed vehicle production in China, sources said, as diplomatic tensions and competition from Chinese brands play havoc on sales and threaten earnings.

China, the world’s biggest auto market, accounted for over a quarter of the pair’s 2016 overseas sales but their March sales there were smashed by anti-Korean sentiment and competition from the likes of Geely Automobile Holdings Ltd.

Hyundai and Kia saw their combined China sales slump by 52 percent in March from a year earlier, Yonhap news agency reported on Tuesday, endangering not only the automakers’ earnings but those of South Korean suppliers.

Political tensions have soared since late February when South Korea’s Lotte Group agreed to provide land for a U.S.

missile defense system outside Seoul. The move angered Beijing, although Seoul says the system is a response to North Korea’s nuclear threat and is not aimed at China.

South Korean firms including Lotte Group have been targeted in a Chinese backlash involving boycott calls in state media, protests and suspensions of operations.

But analysts and sources said the row was just another headache for the South Korean carmakers, whose long-term challenge has been how to compete in China and the United States where their mainstay sedans have lost market share to sport utility vehicles.

“China is not the goose that lays the golden egg for Hyundai anymore,” said Lee Hang-koo, a senior research fellow at Korea Institute for Industrial Economics & Trade.

Hyundai’s problems were a result of its “failed global strategy,” he added.

 SHIFT CUTS Kia Motors has cut production shifts at its China factories, two of the sources familiar with the matter told Reuters.

Hyundai also had eliminated a second shift from its three factories in Beijing starting mid-March, one of the people said.

The sources declined to be identified because the matter was not public. The automakers declined to comment on Tuesday.

Hyundai had already suspended output at its factory in Hebei from March 24 to April 4. It was unclear how the shift cuts would affect employment.

Hyundai Motor has four passenger car factories in China, with one more plant scheduled to commence production later this year. Kia, Hyundai’s smaller affiliate, has three.

Poor consumer sentiment towards South Korean products in China had likely dragged down overseas sales in March, the companies said on Monday without putting a number on the falls.

One source said Kia Motors’ China sales likely more than halved in March from the year prior.

In the United States, Hyundai Motor posted a sales fall of 8 percent and Kia Motors slumped 15 percent in March from a year earlier. The U.S. market declined 2 percent in March.

Hyundai Motor shares fell 2.6 percent and Kia Motors declined 0.8 percent in the wider market, which was down 0.1 percent as of 0310 GMT.
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The U.S. Department of Homeland Security announced steps on Monday to prevent the fraudulent use of H1B visas, used by employers to bring in specialized foreign workers temporarily, which appeared to fall short of President Donald Trump’s campaign promises to overhaul the program.

Trump had promised to end the lottery system for H1B visas, which gives each applicant an equal chance at 65,000 positions each year.

Lobbyists for businesses who rely on H1B visas, commonly used by the tech sector, had expected Trump to upend the lottery in favor of a system that prioritized workers who are highly skilled and would be highly paid in the United States.

The lottery for fiscal year 2018 opened on Monday without changes.

The start of the lottery was seen by those watching the issue as the unofficial deadline for the Trump administration to enact H1B visa reform, and the failure to meet that deadline signals that Trump’s promised overhaul of the system may be off the table or long delayed.

“More oversight is a good start, but employers can still use the program legally to depress wages and replace American workers. That falls short of the promises President Trump made to protect American workers,” said Peter Robbio, a spokesman for Numbers USA, a Washington-based group that advocates for limiting immigration into the United States.

The White House could not immediately be reached for comment.

In keeping with the practice of former President Barack Obama’s administration, employers and foreign workers will enter a lottery system where 65,000 workers are permitted to enter the United States to work. An extra 20,000 H1B visas are reserved for workers with advanced degrees.

Last year, the lottery remained open less than a week before the program reached its cap.

Tech companies rely on the program to bring in workers with special skills and have lobbied for an expansion of the number of H1B visas awarded.

Proponents of limiting legal immigration, including Trump’s senior adviser Stephen Miller, have argued the program gives jobs that Americans could fill to foreign workers at a less expensive cost.

The measures announced by DHS on Monday focus on site visits by U.S. authorities to employers who use H1B visas.

In future site visits, U.S. Citizenship and Immigration Services agents will investigate incidents where an employer’s basic business information cannot be validated; businesses that have a high ratio of H1B employees compared with U.S. workers; and employers petitioning for H1B workers who work off-site.
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The effects of the 2008 financial crisis are still being felt, says the International Monetary Fund’s Managing Director Christine Lagarde. 

She cites a new IMF study showing global productivity has slowed to 0.3 percent over the last decade, lower than the pre-crisis average of about 1 percent growth per year. Had productivity growth followed pre-crisis trends, Lagarde says the overall GDP in advanced economies would be about 5 percent higher.

Lagarde attributes the slowdown in labor productivity — the amount of goods and services produced by an average worker per hour — to three major headwinds: an aging global population, the slowdown in international trade, and the lasting impact of the 2008 financial meltdown.

The slowdown has been particularly abrupt in continental Europe, where five Eurozone member countries — Greece, Portugal, Ireland, Spain and Cyprus — required various emergency bailouts after being unable to refinance their sovereign debt. 

Lagarde says strong policy actions, such as government-backed innovation, may be required to reverse the slowdown. For example, she says ramping up research and development by 40 percent could increase the gross domestic output (GDP) in advanced economies by as much as 5 percent, significantly improving demand at the same time in developing economies. 

But to be effective, Lagarde says governments must provide clear signals about future economic policy and boost investment in education, worker training and infrastructure.

Lagarde made her comments Monday at the conservative-leaning American Enterprise Institute in Washington, just two weeks before the World Bank and IMF annual spring meeting, at which member countries discuss challenges facing the global economy and ways to ensure financial stability around the world.
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Japanese big manufacturers’ business confidence improved for a second straight quarter to hit a one-and-a-half year high in March, a closely watched central bank survey showed, a sign the benefits of an export-driven economic recovery were broadening.

Service-sector sentiment improved for the first time in six quarters and companies remained upbeat on their capital expenditure plans, the Bank of Japan’s “tankan” survey showed, offering hope the economic recovery will gather momentum in coming months.

The data, which will be among factors the BOJ will scrutinize at its next rate review on April 26-27, reinforces a dominant market view the central bank’s next policy move would be to reduce rather than expand monetary stimulus.

“The tankan showed a balanced improvement in corporate sentiment at manufacturers and service-sector firms,” said Yuichiro Nagai, an economist at Barclays Securities. “Overall, the results support the BOJ’s rosy view on the economy.”

The headline index measuring big manufacturers’ business sentiment rose to plus 12 in March from plus 10 three months ago, the tankan showed on Monday, falling slightly short of market forecasts but marking the highest reading since December 2015.

The index gauging big non-manufacturers’ sentiment improved 2 points from plus 20, rising for the first time in six quarters and hitting the highest level since March 2016, the survey showed.

Brexit, Trump cloud outlook

Big manufacturers and non-manufacturers expect business conditions to deteriorate slightly in the coming three months, as risks to global trade such as Britain’s decision to leave the European Union and U.S. President Donald Trump’s protectionist statements cloud the outlook.

Still, the survey found big firms plan to increase capital spending by 0.6 percent in the fiscal year ending in March 2018, compared with a median market forecast for a 0.1 percent drop.

“There has been talk about the risks of protectionism, but so far Japanese companies are not taking any specific steps related to this,” said Norio Miyagawa, senior economist at Mizuho Securities.

“This tankan will reinforce expectations that the BOJ is on hold for the time being. We certainly don’t see the need to ease or tighten policy,” he said.

Signs of life

Japan’s economy has shown signs of life in recent months, with exports and factory output benefiting from a recovery in global demand.

With inflation expected to accelerate later this year, a growing number of analysts now predict the BOJ’s next move would be to start scaling back its massive monetary stimulus.

The tankan’s sentiment indexes are derived by subtracting the number of respondents who say conditions are poor from those who say they are good. A positive reading means optimists outnumber pessimists.

 
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Training for the Boston Marathon has left Tommy Race feeling spent. His bank account, too: Race’s Boston adventure will cost about $2,000.

“It’s a lot of money, but it’s also a vacation,” said Race, a high school math teacher from Bellingham, Washington. “For a runner like myself, I’d much rather throw down money to run Boston than go to Cancun or Europe or some other travel destination.”

Race (yes, that’s his real name) has plenty of company. Thirty-thousand athletes from 94 countries will participate in this month’s 121st running of America’s most venerable footrace, and organizers say they’ll pump $192 million into the local economy.

That’s the equivalent of $311 for every man, woman and child living in the city of Boston.

Sports industry experts say Boston’s payout is part of a lucrative global trend that’s been playing out in Chicago, New York, London and other cities that stage major marathons drawing competitors and spectators from around the world.

“People want to be a part of something that Olympians run in,” said Rich Harshbarger, CEO of Running USA, a nonprofit group that promotes the sport.

“You’re not going to be able to run the bases at Fenway. But at a big marathon, you get to line up and have the same experience that the pros do,” he said.

It’s an affluent bunch: Running USA’s latest national survey, done in 2015, found that more than seven in 10 marathon runners earn more than $75,000 a year, and most are college graduates.

Many in the field for the Boston Marathon on April 17 will bring their families along. Another 10,000 runners will descend on Boston for a sister 5K race, swelling not only the size of the crowds but the amount spent on hotels, restaurants, transportation and a weekend running expo hawking expensive gear and swag.

“Nearly everyone involved … will patronize local businesses,” said Tom Grilk, CEO of the Boston Athletic Association, which manages the marathon.

Included in the $192.2 million projection is $30 million that runners will raise to benefit dozens of charities.

And the Boston Marathon’s economic impact is steadily growing. Last year’s race generated $188.8 million, and the 2015 race brought in $182 million, the Association said.

Patrick Moscaritolo, president and CEO of the Greater Boston Convention & Visitors Bureau, calls race weekend “an extraordinary kick start” for the tourist season.

Other races that are part of the World Marathon Majors – a series that includes Berlin, Boston, Chicago, London, New York City and Tokyo – have an even bigger haul.

The TCS New York City Marathon says its economic impact in 2014, the most recent year for which figures were available, was $415 million. The Bank of America Chicago Marathon had an estimated $277 million impact in 2015, organizers say.

Getting to the start line is expensive, “but it’s worth every penny,” said Malinda Ann Hill, bereavement coordinator for Children’s Hospital of Philadelphia, who’s running her first Boston together with her twin sister.

After 12 attempts to qualify, Hill doesn’t care what it costs.

“My twin won’t total it up, though,” she said. “She doesn’t want to know.”
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 Iraq’s oil minister said on Sunday that his country plans to increase daily crude oil production to 5 million barrels by the end of this year, up from the current rate of about 4.4 million barrels per day, to secure sorely needed cash for its ailing economy.

Iraq, where oil revenues make up nearly 95 percent of the budget, has been reeling under an economic crisis since 2014, when oil prices began their descent from a high of above $100 a barrel. The Islamic State group’s onslaught, starting in 2014, has exacerbated the situation — forcing Iraq to divert much of its resources to a long and costly war.

Addressing an energy conference in Baghdad, Oil Minister Jabar Ali al-Luaibi didn’t give details on which of the country’s oil fields would supply the increased output.

Late last year, Iraq joined a deal by OPEC and non-OPEC members to lower production for six months by 1.8 million barrels a day in order to prop up global oil prices. The mutual production decrease began on Jan. 1. Iraq’s share in the deal is to reduce output by 210,000 barrels a day to 4.351 million barrels.

“There are positive elements in that deal and we achieved a lot of its targets,” al-Luaibi told reporters on the sideline of the conference. “Work and cooperation are underway … to reach the 1.8 [million barrels a day] reduction,” he added, without divulging whether Iraq is going to support an extension to that deal.

OPEC Secretary-General, Mohammed Barkindo, said the compliance among the participants was 86 percent in January and 94 percent in February. Barkindo told reporters that OPEC members would consider whether to extend the production decrease agreement at a meeting next month.

The deal propped up the crude price to around $50 per barrel.

Iraq holds the world’s fourth-largest oil reserves. This year, it added 10 billion barrels, bringing its total reserves up to 153.1 billion barrels.

Al-Luaibi also said that more 15 billion barrels are planned to be added by 2018.

Iraq’s 2017 budget stands at about 100.67 trillion Iraqi dinars, or nearly $85.17 billion, running with a deficit of 21.65 trillion dinars, or about $18.32 billion. That’s based on an estimated oil price of $42 per barrel and daily export capacity of 3.75 million barrels.

Iraq is also grappling with a major humanitarian crisis. The U.N. estimates that more than 3 million people have been forced from their homes since 2014. It also faces growing dissatisfaction among residents of areas recaptured from IS who have had their properties demolished and suffer from scarce public services.

 
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