Biden Highlights Hyundai Announcement of $10B US Investment

President Joe Biden tended to both business and security interests Sunday as he wraps up a three-day visit to South Korea, showcasing Hyundai’s pledge to invest at least $10 billion in electric vehicles and related technologies in the United States.

Before visiting U.S. and South Korean troops monitoring the rapidly evolving North Korean nuclear threat, Biden said the U.S. was ready for any provocation that Kim Jong Un might deliver.

Hyundai’s investment includes $5.5 billion for an electric vehicle and battery factory in Georgia.

Appearing with Biden, Hyundai CEO Euisun Chung said Sunday his company would spend another $5 billion on artificial intelligence for autonomous vehicles and other technologies.

“Electric vehicles are good for our climate goals, but they’re also good for jobs,” Biden said. “And they’re good for business.”

The major U.S. investment by a South Korean company is a reflection of how the U.S. and South Korea are leveraging their longstanding military ties into a broader economic partnership.

Biden said he was not concerned about any possible provocation by North Korea while he is touring the region.

“We are prepared for anything North Korea does,” Biden said in response to a reporter’s question. “We’ve talked through how we’d respond to whatever they do so I am not concerned, if that’s what you’re suggesting.”

The U.S. president has made greater economic cooperation with South Korea a priority, saying on Saturday that “it will bring our two countries even closer together, cooperating even more closely than we already do, and help strengthen our supply chains, secure them against shocks and give our economies a competitive edge.”

The pandemic and Russia’s invasion of Ukraine in February has forced a deeper rethinking of national security and economic alliances. Coronavirus outbreaks led to shortages of computer chips, autos and other goods that the Biden administration says can ultimately be fixed by having more manufacturing domestically and with trusted allies.

Biden’s meeting Sunday with Hyundai’s chief comes after the president made an earlier stop at a computer chip plant run by Samsung, the Korean electronics giant that plans to build a $17 billion production facility in Texas.

Hyundai’s Georgia factory is expected to employ 8,100 workers and produce up to 300,000 vehicles annually, with plans for construction to begin early next year and production to start in 2025 near the unincorporated town of Ellabell.

But the Hyundai plant shows that there are also tradeoffs as Biden pursues his economic agenda.

The president earlier in his term tried to link the production of electric vehicles to automakers with unionized workers. As part of a $1.85 trillion spending proposal last year that stalled in the Senate, Biden wanted extra tax credits to go to the buyers of EVs made by unionized factories. That would have provided a boost to the unionized auto plant owned by General Motors Co., Ford Motor Co. and Stellantis NV at a vital moment when union membership nationwide has been steadily decreasing.

During the Samsung visit, Biden called on Korean companies building plants in the U.S. to hire union workers. In addition to its coming Texas plant, Samsung has a deal in place with Stellantis to build an electric vehicle battery manufacturing plant in the U.S.

“I urge Samsung and Stellantis and any company investing in the United States to enter into partnerships with our most highly skilled and dedicated and engaged workers you can find anywhere in the world: American union members,” he said.

There so far has been no guarantee that the Hyundai Georgia plant’s workers will be unionized.

Katie Byrd, the press secretary for Georgia Gov. Brian Kemp, noted in an email that the state is “Right-to-Work,” which “means that workers may not be required to join a union or make payments to a union as a condition of employment.”

A Hyundai spokesperson did not respond to an email asking if the Georgia plant would be unionized. A senior Biden administration official, who briefed reporters on the condition of anonymity, said there was no contradiction between Biden encouraging investors to embrace union workforces while his administration does “whatever it can” to encourage investment and bring jobs to the U.S.

Before meeting Hyundai’s CEO, Biden attended Mass at his hotel in Seoul along with some White House staff. Biden will also meet with service members and military families at Osan Air Base and address U.S. and Korean troops. Biden and Korean President Yoon Sook Yeol on Saturday announced they will consider expanded joint military exercises to deter the nuclear threat posed by North Korea.

The push toward deterrence by Biden and Yoon, who is less than two weeks into his presidency, marks a shift by the leaders from their predecessors. President Donald Trump had considered scrapping the exercises and expressed affection for North Korean leader Kim Jong Un. And the last South Korean president, Moon Jae-in, remained committed to dialogue with Kim to the end of his term despite being repeatedly rebuffed by the North.

Biden decided to skip a visit to the demilitarized zone on the North and South’s border, a regular stop for U.S. presidents when visiting Seoul. Instead, Biden, who had visited the DMZ as vice president, was more interested in visiting Osan to see an installation “where the rubber hits the road” for U.S. and South Korean troops maintaining security on the Korean Peninsula, said White House national security adviser Jake Sullivan.

Yoon campaigned on a promise to strengthen the U.S.-South Korea relationship. He reiterated at a dinner on Saturday in Biden’s honor that it was his goal to move the relationship “beyond security” issues with North Korea, which have long dominated the relationship.

“I will try and design a new future vision of our alliances with you, Mr. President,” Yoon said.

Biden heads to Tokyo later Sunday. On Monday, he will meet with Japanese Prime Minister Fumio Kishida and lay out his vision for negotiating a new trade agreement called the Indo-Pacific Economic Framework.

A central theme for the trip, Biden’s first to Asia as president, is to tighten U.S. alliances in the Pacific to counter China’s influence in the region.

But within the Biden administration, there’s an ongoing debate about whether to lift some of the $360 billion in Trump-era tariffs on China. Earlier this week, Treasury Secretary Janet Yellen said some of the tariffs are doing more harm to U.S. business and consumers than they are to China.

Sullivan said the president’s national security and economic teams were still reviewing “how to move beyond the trade approach of the previous administration.”

On Tuesday, Japan will host Biden at a summit for the Quad, a four-country strategic alliance that also includes Australia and India.

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Stocks End Lower but Not Quite in Bear Market

Another volatile day on Wall Street ended with more losses for stocks Thursday, drawing the S&P 500 closer to its first bear market since the beginning of the pandemic. 

A bear market means that an individual stock or a stock index, like the S&P 500, has fallen at least 20% from a recent high point. 

The index, a benchmark for many funds, fell 0.6% Thursday after easing off a deeper stumble. The latest decline came a day after the S&P 500 had its biggest drop in nearly two years. It’s now down 18.7% from the record high it set early this year.

The Dow Jones Industrial Average fell 0.8% and the Nasdaq slipped 0.3%. 

The indexes remain in a deep slump as investors worry that the inflation that’s hurting people as they are shopping for groceries and filling their cars with fuel is also walloping profits at U.S. companies. 

“There’s just still a significant amount of uncertainty,” said Lindsey Bell, chief markets and money strategist at Ally Invest, “especially in regard to what the [Federal Reserve] is going to do, how that’s going to impact growth in the future, and additionally, where the heck is inflation going from here.”

The S&P 500 fell 22.89 points to 3,900.79. The Dow dropped 236.94 points to 31,253.13. The Nasdaq slid 29.66 points to 11,388.50. The three indexes are on pace to extend a string of at least six weekly losses. 

Gainers

Smaller-company stocks held up better than the broader market. The Russell 2000 rose 1.38 points, or 0.1%, to 1,776.22. 

Rising interest rates, high inflation, the war in Ukraine and a slowdown in China’s economy have caused investors to reconsider the prices they’re willing to pay for a wide range of stocks, from high-flying tech companies to traditional automakers.  

Wall Street is also worried about the Federal Reserve’s plan to fight the highest inflation in four decades. The Fed is raising interest rates aggressively, and investors are concerned that the central bank could cause a recession if it raises rates too high or too quickly. 

The 10-year Treasury pulled back to 2.85% from 2.88% late Wednesday, but it has been generally rising as investors prepare for a market with higher interest rates. That has also pushed up mortgage rates, which is contributing to a slowdown in home sales. 

The pile of concerns on Wall Street has made for very choppy trading and big swings between gains and losses within any given day. 

Technology stocks have been some of the most volatile holdings. The sector includes heavyweights like Apple that have lofty valuations, which tend to push the market more forcefully up or down. Technology stocks fell Thursday, accounting for a big share of the S&P 500’s drop. 

Household goods companies, grocery store operators and food producers fell broadly. General Mills fell 2.1% and Clorox fell 5.3%. 

Retailers and other companies that rely on direct consumer spending mostly rose. Amazon added 0.2% and Expedia climbed 5.3%.

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New Zealand Hands Out Extra Cash to Fight ‘Inflation Storm’

New Zealand’s government said Thursday it will hand out an extra few hundred dollars to more than 2 million lower-income adults to help them navigate what it describes as “the peak of the global inflation storm.” 

The payments are part of a package of new measures announced in the government’s annual budget. Other plans include increasing health spending by a record amount, putting more money into reducing greenhouse gas emissions and boosting defense spending. 

A report by Treasury painted a rosy picture of the nation’s economy through next year but warned growth would slow markedly from 2024 due to rising interest rates, a reduction in the government’s pandemic spending, and supply issues made worse by Russia’s invasion of Ukraine. 

A Treasury report forecast unemployment would hit a low of 3.1% this year before rising to 4.7% by 2026. It predicted inflation would fall from its current 30-year high of 6.9% to 2.2% over the next four years. 

The inflation payments of 350 New Zealand dollars ($220) over three months begin in August and are targeted at the half of all adults who earn less than 70,000 New Zealand dollars ($44,000) per year. The government also decided to extend other temporary measures aimed at combatting spiraling living costs, including a cut to gas taxes and half-price public transportation fares. 

“Our economy has come through the COVID-19 shock better than almost anywhere else in the world,” said Prime Minister Jacinda Ardern in a statement. “But as the pandemic subsides, other challenges both long-term and more immediate have come to the fore.” 

Ardern has been isolating at her Wellington residence this week after catching the virus. Her office said she’d experienced moderate symptoms and was improving, and at this point still planned to travel to the U.S. next week for a trade trip and to give the commencement speech at Harvard University. 

The record 1.8 billion New Zealand dollars ($1.1 billion) boost to health spending next year comes as New Zealand overhauls its publicly funded system by getting rid of a patchwork of 20 district health authorities in favor of a single system. The extra money will help pay off the debts of the district authorities, rebuild three hospitals, and boost medicine spending. 

“This is going to make a massive difference to every New Zealander, in terms of the health care that they get,” said Finance Minister Grant Robertson. 

Treasury predicted the government’s books would return to the black by 2025 after it borrowed heavily during the pandemic. New Zealand’s net government debt is forecast to remain much lower than in most developed nations, peaking at 20% of GDP in 2024 before dropping to 15% two years later. 

Earlier this week, the government announced a new initiative to help pay for lower-income families to scrap their old gas guzzlers and replace them with cleaner hybrid or electric cars as part of a sweeping plan to reduce greenhouse gas emissions. 

The budget plan also included a boost of 660 million New Zealand dollars to defense spending over four years to cover the cost of depreciating assets. 

Conservative opposition leader Christopher Luxon said the governing liberal Labour Party had an addiction to spending and the budget plans would put the economy into reverse, with New Zealanders experiencing the worst cost-of-living crisis in a generation. 

The budget plan was expected to be quickly approved by lawmakers since the Labour Party holds a majority of seats in the Parliament. 

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US Stocks Fall Sharply on Renewed Inflation Fears

Stocks closed sharply lower Wednesday on Wall Street as dismal results from Target renewed fears that inflation is battering U.S. companies.

The S&P 500, the benchmark for many index funds, fell 4%.

Target lost a quarter of its value, dragging other retailers down with it, after saying its profit fell by half in the latest quarter as costs for freight and transportation spiked. That comes a day after Walmart cited inflation for its own weak results.

The Dow Jones Industrial Average dropped 1,164 points, or 3.6% and the tech-heavy Nasdaq pulled back 4.7%. Treasury yields fell as investors sought safer ground.

“A lot of people are trying to guess the bottom,” said Sam Stovall, chief investment strategist at CFRA. “Bottoms occur when there’s nobody left to sell.”

Retailers were among the biggest decliners after Target plunged following a grim quarterly earnings report.

The weak reports stoked concerns that persistently rising inflation is putting a tighter squeeze on a wide range of businesses and could cut deeper into their profits.

Technology stocks, which led the market rally a day earlier, were the biggest drag on the S&P 500. Apple lost 5.9%.

All told, more than 95% of stocks in the S&P 500 were down. Utilities also weighed down the index, though not nearly as much as the other 10 sectors, as investors shifted money to investments that are considered less risky.

The disappointing report from Target comes a day after the market cheered an encouraging report from the Commerce Department that showed retail sales rose in April, driven by higher sales of cars, electronics and more spending at restaurants.

Stocks have been struggling to pull out of a slump over the last six weeks as concerns pile up for investors. Trading has been choppy on a daily basis and any data on retailers and consumers is being closely monitored by investors as they try to determine the impact from inflation and whether it will prompt a slowdown in spending. A bigger-than-expected hit to spending could signal more sluggish economic growth ahead.

The Federal Reserve is trying to temper the impact from the highest inflation in four decades by raising interest rates. On Tuesday, Fed Chair Jerome Powell told a Wall Street Journal conference that the U.S. central bank will “have to consider moving more aggressively” if inflation fails to ease after earlier rate hikes.

Investors are concerned that the central bank could cause a recession if it raises rates too high or too quickly. Worries persist about global growth as Russia’s invasion of Ukraine puts even more pressure on prices for oil and food while lockdowns in China to stem COVID-19 cases worsens supply chain problems.

The United Nations is significantly lowering its forecast for global economic growth this year from 4% to 3.1%. The downgrade is broad-based, which includes the world’s largest economies such as the U.S., China and the European Union.

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Nigeria Becoming Destination for Africa’s Promising Tech Startups

In February, the Nigerian technology startup CrowdForce announced a big break: It had received $3.6 million from investors to expand its financial services operations to many more underserved communities.  

Co-founder and Chief Executive Officer Tomi Ayorinde said new funding will boost its mobile agent network from 7,000 to 21,000 this year.

“We were looking to scale faster and really gain market share,” Ayorinde said. “And what we’re doing is also very impact-related because we’re creating jobs, avenues for people to make extra income in their communities. So, it was also very interesting for impact investors to be part of what we’re trying to do.” 

When Ayorinde helped launch CrowdForce seven years ago, he intended it to be a data collection company. But after about two years, the company overhauled its business model when Ayorinde realized it could fill a need for bank accounts.   

“When we collected data of 4.5 million traders what we saw was, a lot of them didn’t have bank accounts and the ones that have bank accounts had a very tough time accessing the cash that was sent to them,” said Ayorinde.”That’s when we kind of realized that there’s a bigger problem to solve here.”

Experts say about 60% of Africa’s 1.2 billion people lack access to banks or financial services. Technology startups in Africa are trying to fix that, said the African Private Equity and Venture Capital Association known as AVCA.   

In a recent report, the industry group said African startups attracted $5.2 billion in venture capital last year, and that West Africa – led by Nigeria – accounted for the largest share of investments.    

AVCA research manager Alexia Alexandropoulou said investors are looking to tap into Africa’s huge population of young people.    

“Africa is the world’s most youthful population, so as the proportion of skilled labor increases, then the result will be more human capital in order to power African businesses and also the industrial development within the continent,” said Alexandropoulou.

AVCA’s report also cites increased internet penetration in Africa and more favorable government policies as contributing to increased investments in financial technology services knwoFintech.  

But Fintech Digital Marketing Expert Louis Dike said there are obstacles to overcome, such as weak currencies and policies.  

“Africa is not a perfect place because it’s still made up of virgin markets,” said Dike. “The standard of living is quite low, our regulations are not consistent, today the government will say this and tomorrow they will change the law and restrict some startup activities.”  

But with new talents emerging in technology, more startups with big dreams are emerging in Nigeria and elsewhere in Africa. 

 

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Americans Return to the Office With Willingness and Trepidation 

As cases of coronavirus continue to decline in the United States, many businesses have told their employees it’s time to return to the office.  

Some people are already doing the daily grind, while others are splitting their time between home and the office as part of a hybrid plan.  

The office routine was normal for millions of Americans before the pandemic. Now, some two years later, it is regarded as a new normal, after those employees worked full-time from their residences. 

Morning Consult, a global business intelligence company, has been polling U.S. consumers about returning to the workplace.  

Charlotte Principato, a financial services analyst for the organization, said the latest poll showed 73% of remote workers felt comfortable returning to the office. The remaining 27% wanted to remain at home where, they said, they work more efficiently.  

“The return to the office is experienced differently depending on each person’s situation,” and introverts may have a harder time getting used to it than extroverts, said Debra Kaplan, a therapist in Tucson, Arizona.  

She told VOA many people will experience stress adjusting to an office environment after working from home. 

Mark Gerald, a psychoanalyst in New York, likens it to a child going to school for the first time.  

There’s almost childlike anxiety that’s related to change and fears of going into the world, he said. 

The fears include contracting the coronavirus, as well as being away from family during the workday. 

That’s true for Imani Harris, a federal government employee in Washington who has two young children. 

“I wear a mask at work because I don’t feel safe being at the office,” she said. “I’d rather be at home because I accomplish more, and get to spend quality time with the kids — plus it’s harder financially since I have to spend money on child care.” 

Another drawback is exhaustion.  

“At first, returning to the office can be really draining because you haven’t seen the people you work with in person for a long time,” said Karestan Koenen, a psychiatric epidemiology professor at Harvard University’s School of Public Health. 

“Psychologically and emotionally, the transition is not comfortable but should eventually become more comfortable as time goes on,” she added.  

Still, many workers favor a hybrid approach in which they work more at home than in the office.  

“We tend to see that younger folks are more likely to want a hybrid environment where they feel they’re more productive and have more flexibility and control,” Principato said.  

They also don’t think their jobs need to be done in the office and want to work in a way that feels better for them, Kaplan said.  

For Ethan Carson, who is in his 20s and works for a technology firm in Falls Church, Virginia, going to his office “is more of a bother” than working from home. “I don’t need to be in my building to do my job,” he said, “and the commute is difficult with the horrible traffic.” 

Other employees, however, think it’s easier for them to get their job done around their peers than at home, where there may be more distractions.  

For some, the office makes them feel they are part of a community again.  

“There is a hunger for human connection and sometimes the human touch,” Gerald said.  

“People have realized that socializing is helpful for their mental health,” Kaplan said. “They often feel positive about seeing their colleagues,” talking to them face-to-face, and not just on Zoom, she explained.  

Angela Morgensen, a communications consultant in Bethesda, Maryland, is relieved to be back at the office. 

“I’m enjoying talking to the people I work with and feel more like I’m part of the company again,” she said. “I used to hate meetings, but I’m finding it stimulating to share ideas.” 

Gerald points out that the pandemic has made people think more about a better work-life balance, including how many hours they want to spend in the office. 

“They are not returning as the same person they were before the pandemic happened. Some wonder, ‘Is this job fulfilling and the workplace a good environment for me?'”  

And that’s reflected in seeing hybrid work becoming more of the norm, he said. 

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US Calls for More Economic Support for Ukraine

U.S. Treasury Secretary Janet Yellen is calling on allies to boost their economic support for Ukraine, saying the support pledged so far will not be enough to meet the country’s basic needs.

In comments prepared for the Brussels Economic Forum, Yellen says while Ukraine will eventually need “massive support,” for now it needs “budget funding to pay soldiers, employees and pensioners, as well as to operate an economy that meets its citizens’ basic needs.”

Yellen adds that Ukraine’s “financing needs are significant,” while crediting the bravery and ingenuity of the country’s officials to keep its economy going.

Help could come Wednesday with the European Union expected to propose a set of loans that would help Ukraine both with short-term financing and its rebuilding effort in the longterm.

Some information came from Reuters.

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EU Cuts Eurozone Growth Forecast As Ukraine War Bites

The European Commission on Monday sharply cut its eurozone growth forecast for 2022 to 2.7 percent, blaming skyrocketing energy prices caused by Russia’s invasion of Ukraine.

The war also spurred the EU’s executive to revisit its eurozone inflation prediction for 2022, with consumer prices forecast to jump by 6.1 percent year-on-year, much higher than the earlier forecast of 3.5 percent.

“There is no doubt that the EU economy is going through a challenging period due to Russia’s war against Ukraine, and we have downgraded our forecast accordingly,” EU executive vice president Valdis Dombrovskis said.

“The overwhelming negative factor is the surge in energy prices, driving inflation to record highs and putting a strain on European businesses and households,” he added.

The EU warned that the course of the war was highly uncertain and that the risk of stagflation -– punishing inflation with little or no growth — remained a real risk going forward.

If Russia, the EU’s main energy supplier, should cut off its oil and gas supply to Europe completely, the commission warned that the forecast would worsen considerably.

“Our forecast is subjected to very high uncertainty and risks,” EU commissioner Paolo Gentiloni told reporters.

“Other scenarios are possible under which growth may be lower and inflation higher than we are projecting today. In any case, our economy is still far from a normal situation,” he said.

For the EU as a whole, including the eight countries that do not use the euro as their currency, the commission had also forecast growth of four percent in February, but has now cut this to 2.7 percent, the same level as for the eurozone.

The sharp reduction in expectations is in line with the forecast made in mid-April by the International Monetary Fund, which predicted 2.8 percent growth for the eurozone this year.

The EU’s warning for the months ahead lands as the European Central Bank is increasingly expected to increase interest rates in July to tackle soaring inflation.

Critics warn that this could put a brake on economic activity just when the economy faced the headwinds from the war in Ukraine.

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US, EU to Boost Coordination on Semiconductor Supply, Russia

The United States and the European Union plan to announce on Monday a joint effort aimed at identifying semiconductor supply disruptions as well as countering Russian disinformation, officials said.

The U.S. officials are visiting the French scientific hub of Saclay for a meet up of the Trade and Technology Council, created last year as China increasingly exerts its technology clout.

U.S. officials acknowledged that Russia’s invasion of Ukraine has broadened the council’s scope, but said the Western bloc still has its eye on competition from China.

The two sides will announce an “early warning system” for semiconductors supply disruptions, hoping to avoid excessive competition between Western powers for the vital tech component.

The industry has suffered from a shortage of components for chipmaking, blamed on a boom in global demand for electronic products and pandemic snarled supply chains.

“We hope to agree on high levels of subsidies — that they will not be more than what is necessary and proportionate and appropriate,” Margrethe Vestager, the European Commissioner for Competition, told reporters Sunday.

The aim is that “as both Washington and Brussels look to encourage semiconductor investment in our respective countries, we do so in a coordinated fashion and don’t simply encourage a subsidy race,” a U.S. official said separately, speaking on condition of anonymity.

The United States already put in place its own early warning system in 2021 that looked at supply chains in Southeast Asia and “has been very helpful in helping us get ahead of a couple of potential shutdowns earlier this year,” the US. .official said.

The official added that the two sides are looking ahead to supply disruptions caused by pandemic lockdowns in China — the only major economy still hewing to a zero-Covid strategy.

The European Union and United States will also announce joint measures on fighting disinformation and hacking, especially from Russia, including a guide on cybersecurity best practices for small- and medium-sized companies and a task force on trusted technology suppliers, the official said.

“It’s not a European matter but a global matter,” she said.

U.S. Commerce Secretary Gina Raimondo and U.S. Trade Representative Katherine Tai are visiting for the talks.

Secretary of State Antony Blinken attended an opening dinner on Monday before cutting short his visit to head to Abu Dhabi for the funeral of late leader Sheikh Khalifa.

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Convicted Killer Turned Tech Whiz Confronts His Sordid Past

When he was 20 years old, Harel Hershtik planned and executed a murder, a crime that a quarter of a century later is still widely remembered for its grisly details.

Today, he is the brains behind an Israeli health-tech startup, poised to make millions of dollars with the backing of prominent public figures and deep-pocket investors.

With his company set to go public, Hershtik’s past is coming under new scrutiny, raising questions about whether someone who took a person’s life deserves to rehabilitate his own to such an extent.

“When I was young, I would say that I was stupid and arrogant,” said Hershtik, now 46. “You can be a genius and yet still be very stupid and the two don’t contradict each other.”

Today, Hershtik is the vice president of strategy and technology at Scentech Medical, a company he founded in 2018, while behind bars, which says its product can detect certain diseases through a breath test.

In a three-hour interview with The Associated Press, he repeatedly expressed remorse for his crime.

Hershtik was convicted of murdering Yaakov Sela, a charismatic snake trapper he met when he was 14. The two had a bumpy relationship.

Sela was known for having numerous girlfriends at once, one being Hershtik’s mother. Hershtik said he felt uneasy with how Sela treated some of the women, including his mother.

In early 1996, Sela discovered that Hershtik had stolen 49,000 shekels (about $15,000 at the time) from him, and the two agreed that instead of involving the police, Hershtik would pay him back double that amount. Court documents say Hershtik instead planned to murder Sela.

Pulled over during a drive to gather the money, an accomplice of Hershtik’s fired three shots at Sela, using Hershtik’s mother’s pistol. He then handed Hershtik the gun, according to the documents, and Hershtik shot Sela in the head at close range.

The pair shoved Sela’s body into the trunk and buried it in a grove in the Golan Heights, according to the documents. Weeks later, hikers saw a hand poking up from the earth, and Sela’s body was found.

The sensational crime gripped the nation.

In court documents, prosecutors say Hershtik lied repeatedly in his attempt to distance himself from the murder.

Hershtik said he was compelled to lie so that he could protect the others involved in the scheme, which included his mother.

Hershtik was sentenced to life in prison for premeditated murder and obstructing justice, among other crimes.

He would serve 25 years, during which time Hershtik earned two doctorates, in math and chemistry, and got married three separate times. He said he established 31 companies, selling six of them.

But prison was also a fraught time for Hershtik. He said he spent 11 years in quarantine because of health issues. He was punished twice for setting up internet access to his cell, in one case building a modem out of two dismantled DVD players.

Last year, a parole board determined he had been rehabilitated and no longer posed a danger to society.

As part of his early release and until 2026, he is under nightly house arrest from 11 p.m. to 6 a.m. He must wear a tracking device around his ankle at all times and is barred from leaving the country.

A free man, Hershtik sat recently with the AP in his office in the central city of Rehovot, Israel.

His start-up is waiting for regulatory approval to merge with a company called NextGen Biomed, which trades on the Tel Aviv Stock Exchange and would make Scentech public.

Hershtik said the company’s product is being finalized for detecting COVID-19 through a patient’s breath, and it is working to add other diseases such as certain cancers as well as depression. The product is meant to provide on-the-spot results in a non-invasive way.

The company has received a patent for its technology in Israel and said it is preparing to apply for FDA approval soon.

Hershtik said the merger values the company at around $250 million and that he has raised more than $25 million in funding over the last two years through private Israeli investors. A large part of the investment is from Hershtik’s own money, although he won’t say how much. Prisoners in Israel aren’t barred from doing business, but

Hershtik’s success is rare.

His company is backed by prominent Israeli names, including Yaakov Amidror, who chairs NextGen and is a former chief of the country’s National Security Council.

“According to the rules of the country, the man is allowed to rehabilitate. He paid his price and he rehabilitated. So there is no reason not to help him rehabilitate,” Amidror, who testified to the parole board on Hershtik’s behalf, told the AP.

But Hershtik’s past is already haunting him. Hershtik was demoted from CTO earlier this year to his current position, in part because he didn’t want his crime to scare away investors.

“Harel has always said if for some reason his presence is a problem and the company would be better off without him, that he’s willing to leave the company,” said Drew Morris, a board member and investor.

As Scentech seeks to take its product to market, investors will need to decide whether Hershtik’s rap sheet influences where they put their money.

Ishak Saporta, a senior lecturer at Tel Aviv University’s Coller School of Management, said he believed investors would be drawn to the company’s potential for profit rather than deterred by Hershtik’s history.

“What concerns me here is that he became a millionaire. He paid his debt to society in jail. But does he have a commitment to the victim’s family,” Saporta asked.

Tovia Bat-Leah, who had a child with Sela, suggested he help fund her daughter’s education or create a reptile museum in Sela’s name.

“He served his time but he should also make some kind of reparation,” she said.

Hershtik sees the good that could come about from the company as the ultimate form of repentance. He said he could have used his smarts to create any sort of company with no benefit to society but chose health tech instead.

“Trust me, this is not for the money,” he said.

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African Union Chief Wants Pan-African Credit Ratings Agency

Senegal President Macky Sall called Sunday for the creation of a pan-African credit ratings agency, saying that the “very arbitrary” nature of the system of assessment by international organizations made it more expensive for African countries to borrow on global debt markets.

Sall, who is currently head of the African Union, told private radio RFM that there was a need — “given the injustices, the sometimes very arbitrary ratings” by international agencies — “to have a pan-African” body.  

His comments came on the eve of the Dakar Economic Conference 2022, organized by African economists. 

“In 2020, when all economies were suffering fallout from the COVID-19 pandemic, 18 of the 32 African economies rated by at least one of the big agencies saw their ratings downgraded,” he said.

That meant that 56% of African countries saw their credit ratings downgraded, compared with 31% of countries globally over the same period, Sall argued.

“Studies show that at least 20% of the ratings criteria for African countries are based on more subjective factors, cultural or linguistic ones for example, which bear no relation to the parameters used for measuring economic stability,” he said. 

As a result, “the perception of investment risk in Africa is always much higher than the real risk. That means our insurance premiums are higher and that makes our credit more expensive.” 

African countries continued to pay much higher interest rates as a result of this unfair system, Sall said.

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Egypt to Privatize Key State Companies as Inflation Surges

Egyptian Prime Minister Mostafa Madbouli announced Sunday a string of planned privatizations of state-owned companies, as Cairo grapples with an economic crisis and inflation at almost 15%.

Following years of accusations of state companies crowding out private investments, the government announced a roadmap to more than double the private sector’s share in the economy.

Madbouli laid out plans for 10 state-owned companies and two army-owned companies to be listed on the stock market later this year.

Two new holding companies, to incorporate “the seven largest ports” and “Egypt’s top hotels” will also be formed, percentages of which “will be listed on the stock exchange,” he told reporters.

By 2025, the government hopes to see “private sector contribution in investment grow to 65%,” up from 30% today.

President Abdel Fattah al-Sissi last month announced plans to “double its support to the private sector” in a program aimed to attract $10 billion annually over the next four years.

Earlier this month, American firm S&P Global released its latest Egypt Purchasing Manager’s Index, which showed the state’s non-oil private sector economy contracting for the 17th straight month.

Inflation hit a three-year high of 14.9% in April, a month after the Egyptian pound lost 17% of its value overnight.

The state’s grip on the Egypt’s economy has been criticized as creating unfair competition.

Business magnate Naguib Sawiris last year warned of the effects of an unfair playing field, arguing that “the state has to be a regulator, not an owner” of economic activity.

Madbouli on Sunday said there was “no alternative” to the state’s involvement in the economy, considering the “instability” of recent years, alluding to security concerns surrounding Sissi’s rise to power, and more recently the COVID-19 pandemic.

Since Sissi became president in 2014, the former army general has embarked on massive national infrastructure projects, where the key but opaque role the army has played in Egypt’s economy for decades took center stage.

Although no official figures are published about the army’s financial interests, the new push for privatization of military-owned companies could seek to correct a skewed investment environment.

Since Russia’s invasion of Ukraine in late February sent global commodity prices soaring, Egypt — the world’s largest importer of wheat — has been reeling from mounting economic pressures, pushing the country to apply for a new loan from the International Monetary Fund.

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Pricey Tortillas: Latin America’s Poor Struggle to Afford Staples

No item is more essential to Mexican dinner tables than the corn tortilla. But the burst of inflation that is engulfing Latin America and the rest of the world means that people like Alicia García, a cleaner at a restaurant in Mexico City, have had to cut back.

Months ago, García, 67, would buy a stack of tortillas weighing several kilograms to take home to her family every day. Now, her salary doesn’t go so far, and she’s limiting herself to just one kilogram (2.2 pounds).

“Everything has gone up here,” she told The Associated Press while standing outside a tortilla shop. “How am I, earning minimum wage, supposed to afford it?”

Just as inflation isn’t limited to tortillas, whose prices in the capital have soared by one-third in the past year, Mexico is hardly alone. Latin America’s sharpest price spike in a generation has left many widely consumed local products suddenly hard to attain. Ordinary people are reckoning with day-to-day life that has become a more painful struggle, without any relief in sight.

Countries had already been absorbing higher prices because of supply chain bottlenecks related to the COVID-19 pandemic and government stimulus programs. Then Russia’s invasion of Ukraine in late February sent fertilizer prices sharply higher, affecting the cost of agricultural products including corn. Global fuel prices jumped, too, making items transported by truck to cities from the countryside costlier.

In Chile, annual inflation was 10.5% in April, the first time in 28 years the index has hit double digits. Colombia’s rate reached 9.2%, its highest level in more than two decades. In Argentina, whose consumers have coped with double-digit inflation for years, price increases reach 58%, the most in three decades.

In beef-crazy Buenos Aires, some households have started seeking alternatives to that staple.

“We never bought pork before; now, we buy it weekly and use it to make stew,” Marcelo Gandulfo, a 56-year-old private security guard, said after leaving a butcher’s shop in the middle-class neighborhood of Almagro. “It’s quite a bit cheaper, so it makes a difference.”

Last year, the average Argentine consumed less than 50 kilograms of beef for the first time since annual data were first collected in 1958, according to the Argentine Beef Promotion Institute. Over the past few months, prices have been “increasing a lot more than normal,” said Daniel Candia, a 36-year-old butcher.

“I’ve been in this business for 16 years, and this is the first time I’ve seen anything like this,” he said.

Latin America as a whole is suffering from “sudden price spikes for necessities,” the World Bank’s President David Malpass said during an online conference Thursday. He noted that energy, food and fertilizer prices are rising at a pace unseen in many years.

Across the world, central banks are raising interest rates to try to slow inflation. Brazil’s central bank has undertaken one of the world’s most aggressive rate-raising cycles as inflation has topped 12% — its fastest pace since 2003. Besides the factors that are stoking regional inflation, Brazil’s agricultural products have become costlier because of drought and frost. The price of tomatoes, for example, has more than doubled in the past year.

Higher rates are a government’s primary tool to fight high inflation. But jacking up rates carries the risk of weakening an economy so much as to cause a recession. Last year, the World Bank estimated that the region’s economy grew 6.9% as it rebounded from the pandemic recession. This year, Malpass said, it’s projected to grow only 2.3%.

“That’s not enough to make progress on poverty reduction or social discontent,” he added.

Brazilian newspapers are telling their readers which foods they can substitute for their usual products to help stretch family budgets further. But some items, like coffee, are irreplaceable — especially in the nation that produces more of it than any other in the world.

Ground coffee has become so expensive that shoplifters have started focusing their sights on it, said Leticia Batista, a cashier at a Sao Paulo supermarket.

“It breaks my heart, but I told many of them to give the powder back,” Batista said in the upscale neighborhood of Pinheiros.

In her own humbler neighborhood, she said, the cost of coffee “is a big problem.”

On the more upscale end of the java spectrum, Marcelo Ferrara, a 57-year-old engineer, used to enjoy a daily espresso at his local bakery. Its cost has shot up 33% since January, to 8 reais ($1.60). So he’s cut his intake to two each week.

“I just can’t afford too many of these,” Ferrara said as he gulped one down.

It has been decades since the region’s countries simultaneously suffered soaring inflation. A key difference now is that the global economies are much more interconnected, said Alberto Ramos, head of Latin America macroeconomic research at Goldman Sachs.

“Interest rates will need to go up; otherwise, inflation will run wild and the problem will get even worse,” Ramos said. “Governments cannot be afraid of using rates. It is a proven medicine to bring inflation down.”

So far, though, higher rates aren’t providing much hope that inflation will decline significantly in the near term. The International Monetary Fund last month projected that average inflation in the region, excluding Venezuela, will slow to 10% by year end. That’s not much below the 11.6% rate registered at end-2021 and still more than twice the 4.4% expected for advanced economies, according to the IMF’s World Economic Outlook.

“It will take at least a couple of years of relatively tight monetary policy to deal with this,” Ramos said.

That means belt-tightening and going without some consumer staples, for now, is likely the new norm for the poorest members of society in the notoriously unequal region. More than one-quarter of Latin America’s population lives in poverty — defined as living on less than $5.50 a day — and that’s expected to remain unchanged this year, according to a World Bank study published last month.

Sara Fragosa, a 63-year-old homemaker in Mexico City, didn’t hide her anger at rising prices during an interview at one market’s stall.

“Those who are the poorest are the worst off, while the rich only rise,” said Fragosa, who said she has replaced her regular beef purchases with quinoa and oats.

“You’re not used to it,” she said, “but you don’t have a choice.”

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India Bans Wheat Exports, Irks G7

India banned wheat exports without government approval Saturday after its hottest March on record hit production, in a blow to countries reeling from supply shortages and soaring prices since Russia’s invasion of Ukraine.

The announcement drew sharp criticism from the Group of Seven industrialized nations’ agriculture ministers meeting in Germany, who said that such measures “would worsen the crisis” of rising commodity prices.

“If everyone starts to impose export restrictions or to close markets, that would worsen the crisis,” German Agriculture Minister Cem Ozdemir said at a press conference in Stuttgart.

Global wheat prices have soared on supply fears following Russia’s February invasion of Ukraine, which previously accounted for 12% of global exports.

The spike in prices, exacerbated by fertilizer shortages and poor harvests, has fueled inflation globally and raised fears of famine and social unrest in poorer countries.

It has also led to concerns about growing protectionism following Indonesia’s halting of palm oil exports and India putting the brakes on exports of wheat.

India, the world’s second-largest wheat producer, said that factors including lower production and sharply higher global prices meant it worried about the food security of its own 1.4 billion people.

Export deals agreed to before the directive issued Friday could still be honored, but future shipments need government approval, it said.

But exports could also take place if New Delhi approved requests from other governments “to meet their food security needs”.

“We don’t want wheat to go in an unregulated manner where it may either get hoarded and is not used for the purpose which we are hoping it will be used for –- which is serving the food requirements of vulnerable nations and vulnerable people,” said BVR Subrahmanyam, India’s commerce secretary.

On Thursday New Delhi said it was sending delegations to Morocco, Tunisia, Thailand, Vietnam, Turkey, Algeria and Lebanon “for exploring possibilities of boosting wheat exports from India”.

It was unclear whether these visits would still take place.

Global help

Possessing major buffer stocks, India previously said it was ready to help fill some of the supply shortages caused by the Ukraine war.

“Our farmers have ensured that not just India but the whole world is taken care of,” Commerce and Industry Minister Piyush Goyal said in April.

India said that it planned to increase wheat exports this financial year, starting April 1, to 10 million tons from seven million tons the year before.

While this is a tiny proportion of worldwide production, the assurances provided some support to global prices and soothed fears of major shortages.

Egypt and Turkey recently approved wheat imports from India.

But India endured its hottest March on record – blamed on climate change – and has been wilting in a heatwave in recent weeks, with temperatures upwards of 45 degrees Celsius.

This has hit farmers hard, and this month the government said that wheat production was expected to fall at least five percent this year from 110 million tons in 2021 — the first fall in six years.

Indian wheat exports in the past have been limited by concerns over quality and because the government buys large volumes at guaranteed minimum prices.

The country’s exports have also been held back by World Trade Organization rules that limit shipments from government stocks if the grain was bought from farmers at fixed prices.

Urgent need

The Ukrainian agriculture minister has traveled to Stuttgart for discussions with G-7 colleagues on getting its produce out.  

About “20 million tons” of wheat were sitting in Ukrainian silos and “urgently” needed to be exported, Ozdemir said.

Before the invasion, Ukraine exported 4.5 million tons of agricultural produce per month through its ports – 12% of the planet’s wheat, 15% of its corn and half of its sunflower oil.

But with the ports of Odesa, Chornomorsk and others cut off from the world by Russian warships, the supply can only travel on congested land routes that are much less efficient.

G-7 ministers urged countries not to take restrictive action that could pile further stress on the produce markets.  

They “spoke out against export stops and call as well for markets to be kept open”, said Ozdemir, whose nation holds the rotating presidency of the group.

“We call on India to assume its responsibility as a G-20 member,” Ozdemir added.

The agriculture ministers would also “recommend” the topic be addressed at the G-7 summit in Germany in June, which India’s prime minister, Narendra Modi, has been invited to attend.

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China Faces Grim Economic Prospects, Experts Say

Chinese Premier Li Keqiang has suggested that China’s current job market is “complicated and severe” as the country maintains “unswerving adherence” to the “zero-COVID” policy, whose lockdowns are causing a severe economic contraction throughout the nation.

Derived from a survey of 430 private industrial companies, the Caixin purchasing managers’ index, a reliable indicator for assessing the economy, fell to 36.2 in April from 42 in March, according to a survey released by IHS Markit last week. A reading below 50 indicates contraction, while anything above that gauge shows expansion.

“Demand was under pressure, external demand deteriorated, supply shrank, supply chains were disrupted, delivery times were prolonged, backlogs of work grew, workers found it difficult to return to their jobs, inflationary pressures lingered, and market confidence remained below the long-term average,” said Wang Zhe, senior economist at Caixin Insight Group.

“Keeping market players and securing jobs will win the future,” Li said Saturday, during a national video and teleconference on stabilizing employment, according to the China Daily, a state-controlled news outlet.

Li, who holds the number two position in the Chinese Communist Party (CCP), urged all regional government departments to “conscientiously implement the decisions and arrangements” of the party’s Central Committee and the State Council to maintain jobs and economic stability.

“Stabilizing employment is critical to people’s livelihood and is the key support for the economy to run within a reasonable range,” he said, as he recommended steps for local and provincial governments.

Li asked enterprises to resume production while adhering to the controls designed to contain the spread of COVID-19.

Lockdowns in more than 20 cities, including Shanghai, have frustrated residents and constrained China’s economic growth. WHO Director-General Tedros Adhanom Ghebreyesus said on Tuesday that China’s zero-tolerance strategy was not sustainable, a comment Foreign Ministry spokeperson Zhao Lijian called “irresponsible” a day later.

Global banks such as UBS, Standard Chartered, DBS, Barclays and Bank of America have downgraded their 2022 GDP (gross domestic product) forecasts for China.

China’s first-quarter GDP for 2022 expanded by 4.8% year-on-year, higher than expected but still below Beijing’s full-year target of 5.5%, according to Xinhua, a state-affiliated news outlet.

Liu Meng-chun, managing director at Chung-Hua Institution for Economic Research in Taipei, Taiwan, said the slowdown is attributable not only to China’s COVID policies but also to a crackdown on private enterprise, especially in the technology sector.

He foresees the state taking a financial stake in some of the technology giants to get more control over their operations but said the change would be more one of style than of substance.

“If 1% equity is used to enter the core decision-making circle of its (technology companies) and becomes internal supervision, it represents a change in the supervision model,” Liu said.

Ming-Fang Tsai, a professor at the Department of Industrial Economics at Tamkang University in Taipei, said that even if Beijing stops suppressing tech giants, it would be difficult to return to the era of rapid economic growth.

“Alibaba and Tencent are laying off workers significantly, and now (Beijing) has said that it will stop (the suppression). It will not have any impact on China’s economy,” Tsai told VOA Mandarin.

The tech layoffs fit into a larger picture as China’s economy has been hit by the “five crises” of employment, exports, private investment, real estate and debt defaults, leading its economy into a downward cycle, according to Wu Jialong, a Taipei economist.

Reduced demand for China’s exports, “will reduce employment, income and consumption power, which will affect real estate,” Wu said. “In addition, industrial supervision and common prosperity will also make things worse, which will hurt the willingness and ability of private investment and eventually lead to a crisis of debt default.”

According to Taiwanese economist Liu, if China’s zero-COVID policy lasts for a long time, industries such as real estate, finance and technology will be hit hard, as will retail and consumer services. The combination, he said, will delay the country’s “common prosperity” campaign launched by President Xi Jinping.

“The control of the epidemic will make income distribution more uneven. Polarization will become more serious,” Liu told VOA Mandarin.

According to Xie Tian, an associate professor of marketing at the University of South Carolina Aiken, even if the zero-COVID policy caused the Chinese economy to collapse, Chinese authorities would be more likely to return to the planned economy of the Mao Zedong era than to adjust to current forces.

“Now the CCP has launched a lot of ‘supply and marketing cooperatives,’ ‘unified purchase and unified sales,’ just to deal with the economic impact that the city lockdowns may bring, because it wants to suppress the people, and the government controls all goods, sources of goods and channels to achieve its political goals.” Xie told VOA Mandarin.

“Unified purchase and unified sales” refers to a policy implemented by China from the 1950s to the 1980s to exert state control over agricultural resources such as grain and cotton. The Chinese government purchased these products in rural areas and rationed them out to city dwellers.

In July last year, China began a pilot program of “supply and marketing cooperatives.” This recalls how the CCP acted as it established a government in 1949 during a post-civil war period of material scarcity.

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Musk Says $44-billion Twitter Deal Temporarily On Hold

Elon Musk said on Friday his $44-billion deal for Twitter Inc was temporarily on hold, citing pending details on spam and fake accounts.

“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Musk said in a tweet.

Shares of the social media company fell 20% in premarket trading. Twitter did not immediately respond to a request for comment.

The company had earlier this month estimated that false or spam accounts represented fewer than 5% of its monetizable daily active users during the first quarter.

It also said it faced several risks until the deal with Musk is closed, including whether advertisers would continue to spend on Twitter.

Musk, the world’s richest man and the chief executive of Tesla Inc, had said that one of his priorities would be to remove “spam bots” from the platform.

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