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China’s factories picked up their pace and retail sales also gained momentum in August, the government reported Friday, suggesting the economy may be gradually recovering from its post-pandemic malaise.

However, despite busy activity in restaurants and stores, the figures showed continuing weakness in the all-important property sector, where real estate developers are struggling to repay heavy loads of debt in a time of slack demand. Investment in real estate fell 8.8% in August from the year before. The decline has been worsening since the beginning of the year.

Acting to relieve the burden on banks, the People’s Bank of China, or central bank, announced late Thursday that the reserve requirement for most lenders would be cut by 0.25 percentage points as of Friday.

That would free up more money for lending, “In order to consolidate the foundation for economic recovery and maintain reasonable and sufficient liquidity,” the central bank said.

Friday’s report showed retail sales rose 4.6% in August from a year earlier, with auto sales climbing 5.1%. Retail sales rose a meager 2.5% in July.

Consumers grew more cautious about spending in the past year, even as China loosened stringent policies to contain outbreaks of COVID-19.

Industrial output grew at a 4.5% annual pace, up from 3.7% in July and the fastest rate since April.

“Overall, in August, major indicators improved marginally, the national economy recovered, high-quality development was solidly advanced, and positive factors accumulated,” Fu Linghui, spokesperson for the National Bureau of Statistics, told reporters.

But Fu added that there were “still many external factors of instability and uncertainty” and that domestic demand remains weak, so that “the foundation for economic recovery still needs to be consolidated.”

The trends in August were somewhat better than expected, Julian Evans-Pritchard of Capital Economics said in a report.

“Fiscal support shored up investment, but the real bright spot was a healthy pick-up in consumer spending, suggesting that households may be turning slightly less cautious,” he said.

China’s economy expanded by 0.8% in the three months ending in June compared with the previous quarter, down from 2.2% in January-March. That is equivalent to a 3.2% annual rate, which would be among the weakest pace in decades.

Roughly one in five young workers is unemployed, a record high, adding to pressures on consumer spending.

The downturn in the housing market, which spills into many other sectors in addition to construction and materials, also has weighed on China’s recovery from severe disruptions of the past several years as the ruling Communist Party tried to eliminate waves of COVID-19 infections.

Share prices advanced Friday after the figures were released, with Hong Kong’s Hang Seng gaining 1.7% while the Shanghai Composite index rose 0.3%.

“There’s a growing sense of optimism among a cohort of investors who believe that Beijing’s recent initiatives to stimulate the economy and stabilize financial markets are showing signs of success,” Stephen Innes of SPI Asset Management said in a commentary. 
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About 13,000 U.S. auto workers stopped making vehicles and went on strike Friday after their leaders couldn’t bridge a giant gap between union demands in contract talks and what Detroit’s three automakers are willing to pay.

Members of the United Auto Workers union began picketing at a General Motors assembly plant in Wentzville, Missouri, a Ford factory in Wayne, Michigan, near Detroit, and a Stellantis Jeep plant in Toledo, Ohio.

It was the first time in the union’s 88-year history that it walked out on all three companies simultaneously as four-year contracts with the companies expired at 11:59 p.m. Thursday.

The strikes will likely chart the future of the union and of America’s homegrown auto industry at a time when U.S. labor is flexing its might and the companies face a historic transition from building internal combustion automobiles to making electric vehicles.

If they last a long time, dealers could run short of vehicles and prices could rise. The walkout could even be a factor in next year’s presidential election by testing Joe Biden’s proud claim to be the most union-friendly president in American history.

“Workers all over the world are watching this,” said Liz Shuler, president of the AFL-CIO, a federation of 60 unions with 12.5 million members.

The strike is far different from those during previous UAW negotiations. Instead of going after one company, the union, led by its pugnacious new president, Shawn Fain, is striking at all three. But not all of the 146,000 UAW members at company plants are walking picket lines, at least not yet.

Instead, the UAW targeted a handful of factories to prod company negotiators to raise their offers, which were far lower than union demands of 36% wage increases over four years. GM and Ford offered 20% and Stellantis, formerly Fiat Chrysler, offered 17.5%.

Even Fain has called the union’s demands audacious, but he maintains the automakers are raking in billions and can afford them. He scoffed at company statements that costly settlements would force them to raise vehicle prices, saying labor accounts for only 4% to 5% of vehicle costs.

“They could double our raises and not raise car prices and still make millions of dollars in profits,” Fain said. “We’re not the problem. Corporate greed is the problem.”

In addition to general wage increases, the union is seeking restoration of cost-of-living pay raises, an end to varying tiers of wages for factory jobs, a 32-hour week with 40 hours of pay, the restoration of traditional defined-benefit pensions for new hires who now receive only 401(k)-style retirement plans, pension increases for retirees and other items.

Starting in 2007, workers gave up cost-of-living raises and defined benefit pensions for new hires. Wage tiers were created as the UAW tried to help the companies avoid financial trouble ahead of and during the Great Recession. Even so, only Ford avoided government-funded bankruptcy protection.

Many say it’s time to get the concessions back because the companies are making huge profits and CEOs are raking in millions. They also want to make sure the union represents workers at joint-venture electric vehicle battery factories that the companies are building so workers have jobs making vehicles of the future.

Top-scale assembly plant workers make about $32 per hour, plus large annual profit-sharing checks. Ford said average annual pay including overtime and bonuses was $78,000 last year.

Outside the Ford plant in suburban Detroit, worker Britney Johnson, 35, has worked for the company about 3 1/2 years and has yet to reach top union wages. “I like the job. It’s just that we deserve more,” she said.

She’s after higher pay, the return of pensions, cost of living raises and an end to different tiers of wages.

Johnson said this is her first strike, but she’s been preparing for it for months and putting away money. “It’s not fun. There are a lot of people who are not going to get paid,” she said. She guesses that the strike will last a couple of weeks.

“We’re the ones for the last 20 years who have been kind of hoping things would change and we would get back some of the stuff that we lost with the bankruptcy,” said Tommy Wolikow, who delivers parts to an assembly line at GM’s pickup truck plant in Flint, Michigan, which is still making vehicles. “And every contract, it just seemed like we didn’t get what we deserved.”

Wolikow called this year’s talks huge, and said meeting the company in the middle isn’t good enough. “I think it needs to be a little bit closer to the top of what were asking for,” he said.

The automakers, however, say they’re facing unprecedented demands on capital as they develop and build new electric vehicles while at the same time making gas-powered cars, SUVs and trucks to pay the bills. They’re worried that labor costs will rise so much that they’ll have to price their cars above those sold by foreign automakers with U.S. factories.

GM CEO Mary Barra told workers in a letter Thursday that the company is offering historic wage increases and new vehicle commitments at U.S. factories. GM’s offer, she wrote, “addresses what you’ve told us is most important to you, in spite of the heated rhetoric from UAW leadership.”

The limited strikes will help to preserve the union’s $825 million strike fund, which would run dry in about 11 weeks if all 146,000 workers went on strike.

Under the UAW strategy, workers who go on strike would live on $500 per week in strike pay from the union, while others would stay on the job at full pay. It’s unlikely the companies would lock the remaining workers out of their factories because they want to keep building vehicles.

But Fain has said the union would increase the number of plants on strike if it doesn’t get fair offers from the companies.

It’s tough to say just how long it will take for the strikes to cut inventories at dealers and start hurting the companies’ bottom lines.

Jeff Schuster, head of automotive for the Global Data research firm, said Stellantis has the most inventory and could hold out longer. The company has enough vehicles at or en route to dealers to last for 75 days. Ford has a 62-day supply and GM has 51. All have been building as many highly profitable pickup trucks and big SUVS as they can.

Still, Schuster predicted the strikes could last longer than previous work stoppages such as a 2019 strike against GM that lasted 40 days.

“This one feels like there’s a lot more at risk here on both sides,” he said.
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Italy is considering whether to leave the Belt and Road Initiative, Beijing’s multibillion-dollar global trade and infrastructure program, by the end of the year. The dilemma comes amid geopolitical pressures from Western allies and domestic disappointment that the program has not delivered the economic benefits that the country hoped for.

Italian Prime Minister Giorgia Meloni spoke to reporters after meeting the Chinese delegation at last week’s G20 summit in New Delhi.

“There are European nations which in recent years haven’t been part of the Belt and Road but have been able to forge more favorable relations [with China] than we have sometimes managed,” Meloni said. “The issue is how to guarantee a partnership that is beneficial for both sides, leaving aside the decision that we will take on the BRI.”

BRI benefits?

Italy signed on to China’s BRI in 2019, the only member of the Group of 7 most advanced economies — including Canada, France, Germany, Japan, the United Kingdom and the United States — to do so. But Italy has not received the expected economic benefits, Filippo Boni, a lecturer in politics and international studies at the Open University in England, told VOA.

“From the Italian side, the idea was to both try and boost its exports but also to make a political move towards Brussels, as a signal that Italy was able to sign successful deals with third countries independently from the European Union,” Boni said, adding that Meloni is seeking to make a clear break with previous [Italian] governments by forging new relationships with China and the EU.

“There is a growing realization that the memorandum of understanding that was signed with China in March 2019 did not really bring the benefits that were expected,” he said. “Trade balance is still heavily tilted in China’s favor, and Italian exports to China did not pick up, did not see the increase that those who wanted [the BRI] were envisaging and hoping for.”

Geopolitics

There are also geopolitical reasons for Italy rethinking its membership in China’s BRI, said Luigi Scazzieri, a senior research fellow at the Centre for European Reform.

“There’s come to be a certain diplomatic stigma attached to it, partly because the whole of the West is rethinking its relationship with China,” Scazzieri told VOA. “And Italy being the only G7 country having signed up to the Belt and Road makes it, on the other hand, look like it’s trying to get closer to Beijing.”

Italy’s Western allies are reducing their reliance on some Chinese imports and restricting the sale of technologies such as advanced semiconductors to Beijing.

In recent years, Italy’s government has blocked the sale of some of its biggest companies to Chinese firms, such as the tire maker Pirelli, under its so-called Golden Power rules.

“It’s really a clear signal the government in Rome is sending to its partners in the European Union, and Washington most importantly, about Italy’s position on the international chess board,” Boni said.

China’s response

Questioned about Italy’s potential departure from the BRI this week, China’s Foreign Ministry insisted the program brings benefits to its members.

“The Belt and Road Initiative has attracted more than 150 countries and a wide range of partners in various fields over the past 10 years and has brought tangible benefits to the people of all countries,” Foreign Ministry spokesperson Mao Ning told reporters. “It is in the interests of all participating countries to further tap the potential of cooperation.”

Italy is choosing its language carefully and said it wants to boost trade with Beijing outside the BRI, Scazzieri said.

“The fear of Beijing reacting in a negative way has been precisely why Meloni has been quite careful about how to go about extracting Italy from BRI,” he said.

Italy already has a strategic partnership with China, an agreement Beijing has signed with many countries aimed at fostering economic and cultural ties. It’s likely Rome will seek to amend that document in the hope of replacing its BRI membership with a looser relationship.

“Given the centrality that ‘strategic partnerships’ have in China’s foreign policy — as of the end of last year, there were 110 strategic partnerships that China signed with countries globally — I think it might be a good way out of the Belt and Road Initiative for both countries to say, ‘We’re still engaged in bilateral cooperation,’ ” Boni said.
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All About America explores American culture, politics, trends, history, ideals and places of interest.

While the COVID-19 pandemic dramatically transformed the way Americans work, with millions of people now working a hybrid schedule, the office itself remains stuck in pre-pandemic times.

“The offices that we have have largely been designed as a place that people need to come. Many of them are cube farms that are really boring, unexciting, and nobody wants to be there,” says Aditya Sanghvi, senior partner at McKinsey & Company, who leads the management consulting firm’s real estate practice. “The office has suddenly become a choice. It’s an option. And the office has to be better for someone than working from home and enduring the commute to come into the office.”

More Americans than ever have a hybrid schedule, splitting time between working from home and going into the office. A spring 2022 survey of 25,000 Americans by McKinsey & Company found that 58% of respondents were able to work from home at least one day a week. The U.S. Department of Labor reported that more than one-third of Americans, 34%, worked from home at least some of the time in 2022.

Despite these changes in how Americans work, the workplace has largely remained the same.

“If you’re going to be working in a cubicle, you might as well be working from home. You won’t have to engage in the commute, which is a productivity killer,” says Ryan Luby, an associate partner at McKinsey & Company who co-authored the report. “And then when you get to the office, if you’re not engaging with anyone else, you might as well not be there.”

Enter the U.S. federal government. Even though the government is often perceived as an unwieldy bureaucracy where little changes, the U.S. General Services Administration (GSA), the agency that oversees federal buildings, is among those taking the lead to determine what the office of the future will look like.

“What we’re trying to do is create a workplace and an environment that allows you to be as productive as you can be without getting in the way. And that means a variety of spaces for a variety of the people that work for us,” says Chuck Hardy, GSA’s chief architect.

Hardy is overseeing GSA’s Workplace Innovation Lab, a 25,000-square-foot space, located inside the organization’s Washington headquarters, where federal workers can try out the latest in workplace furnishings and technology, supplied by private vendors. During the yearlong experiment, federal workers from across the government can sign up to work in the lab, testing out the different layouts and latest innovations. In return, they are asked to provide feedback on their experience.

“The office should be a magnet not a mandate. We’re looking to have an office that brings people back to it purposefully,” Hardy says. “It’s not a one-size-fits-all. And in certain agencies and certain offices, it can be multiple solutions. And so, we’re looking at what is that mix of a solution?”

Some spaces in the lab feature comfortable chairs and sofas. Others look more like traditional workspaces. Almost everything can be moved around. The air quality is monitored, and sustainable technology solutions are being tested. Hardy says the office of the future also needs to have advanced acoustics and technology.

Sanghvi foresees more seamless meeting spaces.

“There needs to be immersive conference rooms where it almost feels like there’s no difference between whether or not someone’s sitting with you in the office or somebody’s by video,” he says. “And I assume over the next 10 years, we’ll get a great evolution in that.”

The office needs to change because the role of the workplace has changed, according to Luby.

“The office should be a place where you’re doing group work, where you’re doing community-oriented collaborative activities,” Luby says. “That space should be suited for collaboration, community gathering and facilitating those moments that matter. It’s going to be much more group oriented. It’s going to be a more flexible space, more modular.”

The office of the future might even help workers with their errands.

“One of the reasons that a lot of people work from home is that they have to pick up the kids or do dry cleaning. They have to take care of the dog,” Sanghvi says. “And so, what if there were pet care in the building? What if there was child care in the building?”

Sanghvi believes landlords have to take a more active role in transforming workspaces for the new post-pandemic reality.

“We all trust our hotels to help us with services when we stay in a hotel,” he says. “Many retailers trust the shopping mall owners with doing marketing on behalf of everyone and driving traffic. So, it’s just a different motion for offices, but it’s pretty well-established elsewhere.”

Office planners of the future will likely try to address three main criteria, according to Hardy at the GSA.

“It has to be quality, has to be serving a purpose, but it still has to be beautiful,” he says. “And so, that’s what we’re looking for here — you don’t want to go into a building that looks like you’re in a basement. … You’re seeing office settings that have similarities to a living room setting or have similarities to a den. You’re seeing furniture that’s a little more comfortable.”

Which means the office of the future could feel a little bit more like home.
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The COVID-19 pandemic changed the way Americans work. With millions of people now working from home at least part of the time, experts say offices must evolve to meet their needs. The U.S. General Services Administration, the agency that oversees federal buildings, is trying to determine what that means. VOA’s Dora Mekouar visited its Workplace Innovation Lab to learn more. Camera: Adam Greenbaum.
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U.S. consumer prices jumped by the most in more than a year in August, mostly riding higher on an increase in gasoline prices, the government said Wednesday. However, analysts say underlying price pressures were tame enough that the country’s central bank may not see the need to increase its benchmark interest rate at next week’s meeting.

The country’s consumer price index edged higher last month by 3.7% on an annualized basis, after a 3.2% increase in July, the Labor Department said. Prices were up six-tenths of a percentage point in August over July after increasing by 0.2% for two straight months.

Even with the higher prices, analysts said policymakers at the central bank, the Federal Reserve, could refrain from increasing their benchmark interest borrowing rate at next week’s meeting as they wait for further evidence of the country’s inflation track.

The Fed has raised the rate 11 times in the last year and a half to curb borrowing and spending to tame inflation, which reached a recent peak of 9.1% in June 2022. The Fed’s key borrowing rate courses through the U.S. economy, helping establish interest rates for business and consumer loans.

Greg McBride, the chief financial analyst at Bankrate.com, said in a statement, “The Federal Reserve is poised to hold interest rates steady at their meeting next week but there are still some concerns within this [consumer price] report — gasoline prices, motor vehicle insurance, maintenance and repair — that the Fed won’t dispel the idea of an additional interest rate hike before year-end.”

The key culprit in the August inflation increase was the rising price of gasoline for motorists at service stations, where prices peaked at nearly $4 a gallon (3.8 liters) in the third week of the month.

U.S. President Joe Biden, campaigning for reelection in 2024, took note of the economic trends in a statement, “Overall inflation has also fallen substantially over the last year, but I know last month’s increase in gas prices put a strain on family budgets.”

In national polling, Americans who are particularly conscious of their household expenses have given Biden poor marks for his handling of the economy. Biden in turn noted in his statement, “Unemployment has remained below 4% for 19 months in a row, the share of working-age Americans with a job is the highest in 20 years, and real wages are higher now than they were before the pandemic.”

The Federal Reserve attempts to adopt policies that keep the increase in U.S. consumer prices at an annualized rate of 2%.

With the rate currently higher than that, U.S. economic fortunes are certain to be a key factor in next year’s presidential contest, with Biden’s Republican opponents blaming him for higher inflation because of increased government spending that he supported. Biden said the money for infrastructure repairs helped create thousands of new jobs and was needed to fix deteriorating roads and bridges.
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Nigerians are praising the lifting of a visa ban by the United Arab Emirates following a meeting in Abu Dhabi this week between President Bola Tinubu and United Arab Emirates President Mohamed bin Zayed Al Nahyan.

Nigerian authorities also secured an investment deal worth billions of dollars, according to the presidency.

Nigerian presidential spokesperson Ajuri Ngelale said Nigeria and the United Arab Emirates have established a framework for investments worth billions of dollars across multiple sectors, including defense and agriculture.

Speaking to Lagos-based Channels Television, Ngelale said the pact also resulted in the immediate lifting of a visa ban imposed by the UAE in October 2022.

“What we’ve done today is to not only normalize relations but then to add new dimensions to that relationship or partnership that are mutually beneficial to both nations,” he said. “And I think as we move forward, the details of those investments will become clear.”

The UAE imposed the visa ban on Nigeria in connection with a number of diplomatic disputes.

Dubai’s Emirates airline also suspended flight operations to Nigeria over Abuja’s inability to send the UAE an estimated $85 million in revenue that Dubai said had been blocked in the African nation. The monies could not be repatriated due to dollar shortages.

Additionally, the UAE’s Etihad Airways stopped flights to Nigeria.

But Ngelale said Emirates and Etihad airlines are expected to resume operations immediately without any payment by the Nigerian government.

The spokesperson also said Tinubu successfully negotiated a new foreign exchange liquidity program with the UAE.

Nigerian experts such as economist Emeka Orji welcomed the president’s move as a step that could reverse negative economic trends.

“It should be a no-brainer for them to reverse it,” Orji said. “The major chunk of their tourism, whether it is education or for holidays, Nigeria would show up on the list of its major tourism income-earning countries.”

In a recent statement, the UAE’s official Emirates News Agency noted that its leader and Tinubu explored opportunities for further bilateral collaboration in areas that served the sustainable economic growth of both countries.

The statement, however, did not go into detail about the lifting of the visa ban on Nigerians and the resumption of flights.

Orji says there will be a positive impact.

“International relations between the two countries will likely lead to an increase in economic activity,” he said. “There may be some interest in investing in some sectors in Nigeria. That would be an obvious gain for Nigeria.”

For now, experts said they hope the new pact is fully implemented for both countries to benefit.
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In a historic move, the African Union has secured a permanent place in the Group of 20, also known as the G20, a development that could have major implications for Africa’s role in global geopolitics. 

As the continent faces an array of challenges, ranging from climate change to political instability and economic inequality, experts disagree on how big an impact G20 membership will have as the AU joins 20 of the world’s largest economies.

Robert Besseling, chief executive officer of Pangea-Risk, an intelligence advisory group based in South Africa and Britain, told VOA it is more of a symbolic development than a substantive event.

“The AU seat at the G20 will be meaningless,” Besseling said, if the African body cannot react decisively to events that include “the spree of military coups and irregular elections that have set back Africa’s democratic trajectory in recent months.”

Seven African countries have experienced military-led coups since 2020, most recently Gabon and Niger, raising questions about political stability, the lack of which makes it harder to address pressing issues like terrorism and food shortages in many countries.

Dennis Matanda, adjunct professor of American politics and international business at Catholic University, told VOA English to Africa Service’s TV program “Africa 54” that Africa’s membership in the G20 could pay dividends.

“There is a real opportunity here for the African Union to come to the table. And that is a strength, and that is the opportunity,” he said. He added that “the significance here is that for the first time, the African Union is being juxtaposed with the European Union.”

Besseling, however, has doubts about the AU’s ability to act cohesively.

He also said the AU’s membership in the G20 is mainly driven by tensions on the world stage between competing alliances.

“The G20 is increasingly becoming a counterweight to the China-led BRICS, and the AU’s entry should be viewed in that same context of geopolitical rivalry,” Besseling said.

On a more positive note, Besseling said the AU’s entry into the G20 may help diversify global alliances and open new avenues for cooperation.

Matanda said it is time for African nations to defend their own interests and not be used to further the objectives of global powers.

“I think we need to stop thinking about what the other places want, what China wants, what Europe wants, and start the process of generating Africa’s own narrative,” Matanda said. “Africa, the African Union, needs to undertake a comprehensive assessment of its opportunities. And the primary opportunity here is the region’s development finance institutions.”

As the G20 evolves into a forum of considerable influence, the AU’s presence amplifies the continent’s voice within this arena, he said.

“If they’re going to have global capital playing in Africa, you need to come to the table with the best people who can actually control the finances and basically channel those resources to the opportunities that achieve the most effective impact for the region,” Matanda said. “And from that perspective, we need to remember that the African Union can be all it wants to be, but it needs to have more power.”

This story originated in the Africa Division. English to Africa’s Esther Githui-Ewart contributed to the report.
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The European Commission – the European Union’s executive branch – has downgraded its economic forecast for the Eurozone, saying inflation is still too high, consumer spending is down and Germany, the continent’s largest economy, is in recession.

At a news conference in Brussels Monday, EU Economy Commissioner Paolo Gentiloni said they are now predicting the gross domestic product (GDP) of the 27-nation EU will expand at eight-tenths of one percent for 2023, and at 1.3 percent in 2024.

Those numbers are down from the May projections of 1.1 and 1.6 percent, respectively.

Gentiloni said Germany’s GDP was significantly weaker than expected in the first half of this year, with declining wages driving down consumer spending, and lower external demand leading to subdued exports.

He said the German economy is now projected to shrink by 0.4 percent in 2023, “a significant downward revision” from a May prediction of 0.2 percent growth.

He said they are forecasting that Italy’s and the Netherlands’ economies will also grow more slowly this year, with GDP expansion of 0.9 percent and 0.5 respectively, down from earlier projections of 1.2 percent and 1.8 percent.

But the commission said the economies of France and Spain will grow faster than previously expected this year, projecting 1.0 percent and 2.2 percent growth respectively, instead of the previously seen 0.7 percent and 1.9 percent.

Some information for this report was provided by the Associated Press, Reuters and Agence France-Presse.

 
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Richie Olsten has been in Maui’s helicopter tour business for a half century, so long he’s developed a barometer for the tourism-dependent economy: rental cars parked at the island’s airport.

There are so many since wildfires killed at least 115 people in the historic town of Lahaina that Olsten is worried about a full-blown economic catastrophe. Restaurants and tour companies are laying off workers, and unemployment is surging.

State tourism officials, after initially urging travelers to stay away, are now asking them to come back, avoid the burn zone and help Maui recover by spending their money. Airlines have started offering steep discounts, while some resorts have slashed room rates by 20% or are offering a fifth night free.

“I know what a terrible disaster that was. But now we’re in crisis mode,” Olsten said. “If we can’t keep the people that have jobs employed, how are they going to help family members and friends that lost everything?”

The number of visitors arriving on Maui sank about 70% after the Aug. 8 fire, down to 2,000 a day.

Olsten’s Air Maui Helicopters now operates one or two flights a day, compared with 25 to 30 before the fires.

As Air Maui’s director of operations, Olsten said his company has laid off seven of its 12 dispatchers. Pilots have been spared because they only get paid when they work. Typically, they fly eight times a day, four to five days a week. That has fallen to one day a week, and only one or two flights.

Many Maui hotels are housing federal aid workers and Lahaina residents who lost their homes. Even so, only half of available hotel rooms are occupied, said Mufi Hannemann, president of the Hawaii Lodging & Tourism Association.

Even those in South Maui, 48 kilometers south of Lahaina, are half empty. Hannemann called the situation “pretty grim.”

One of Maui’s most venerable restaurants, Hali’imaile General Store, laid off about 30 workers and temporarily closed after business shrank to one-tenth of pre-fire levels.

“It just fell off a cliff,” said Graeme Swain, who owns the place with his wife, Mara.

They cut staff to preserve cash and spare Hali’imaile the fate of the San Diego software company Swain was running in 2008. When the housing bubble burst and the U.S. plunged into recession, he kept all employees “to the bitter end,” crushing the business.

Swain wants Hali’imaile — which was founded as a general store for pineapple plantation workers a century ago and became a restaurant in 1987 — to last decades more.

“It takes a lot of soul-searching of what’s the right thing to do to protect that place,” said Swain, who plans to hire everyone back. He aims to reopen next month.

Mass layoffs are showing up in government data. Nearly 8,000 people filed for unemployment on Maui during the last three weeks of August compared with 295 during the same period in 2022.

University of Hawaii economists expect Maui’s jobless rate to climb as high as 10%. It peaked at 35% during the COVID-19 pandemic, but in July was just 2.5%. And this time, there are no pandemic-era Paycheck Protection Program loans for businesses, nor any enhanced unemployment checks for the jobless.

Clothing designer Gemma Alvior estimates that locals make up almost all the clientele at her Kahului store, Pulelehua Boutique. But that may not shield her in a place where the tourism industry accounts for 75% of private sector jobs.

“If they don’t have a job, they’re getting laid off, how are they going to buy stuff?” she said. “What do they need to buy clothes for if they’re not working?”

One reason visitor traffic plunged is that Hawaii’s leaders, joined by Hollywood celebrities, told travelers to vacate the island.

The day after the fire, the Hawaii Tourism Authority, a quasi-state agency, said visitors on “non-essential travel are being asked to leave Maui” and that “non-essential travel to Maui is strongly discouraged.”

The agency said the community needed to focus on recovery and helping those who had to evacuate.

Around the world, people saw video and photos of travelers jamming the Kahului airport to board flights out.

That message has since changed.

“Maui’s not closed,” Mayor Richard Bissen said in a recent interview.

People shouldn’t go to Lahaina or the surrounding West Maui area — “It’s not a place to stare,” Bissen said — but the rest of Maui needs tourists. “Respect the West, visit the rest,” is the motto some have adopted.

The Hawaii Tourism Authority drafted and publicized a map showing Lahaina and West Maui in relation to the rest of the island, highlighting just how much was still open. The authority is also launching a $2.6 million marketing plan to lure tourists back.

Two days after the fire, Jason Momoa, a Hollywood actor and Native Hawaiian, told his 17 million Instagram followers, “Do not travel to Maui.” More recently, he advised: “Maui is open. Lahaina is closed.”

Travel to areas outside West Maui should return to pre-fire levels by Thanksgiving, predicted Carl Bonham, an economics professor at the University of Hawaii at Manoa. Discounted airfares and marketing appeals should help, he said.

Gov. Josh Green told a meeting of the state Council on Revenues that he expects authorities to reopen most of West Maui to travelers on Oct. 8, with the exception of fire-damaged neighborhoods. The area, which includes beach resorts in Kaanapali, north of historic Lahaina, has 11,000 hotel rooms. That’s half Maui’s total.

The disaster prompted state officials on Wednesday to lower their 2023 economic growth prediction for the entire state to 1.1%, down from 1.8%. Next year, they expect 1.5% growth instead of 2%.

Bonham estimated the fires would depress state tax revenues by $250 million this fiscal year but said he was “encouraged” by the plan to reopen West Maui in one month.

The council, which produces tax revenue forecasts, predicted Thursday that state tax revenue would rise 1.3% during the current fiscal year compared with last year. The governor and lawmakers are required to use the panel’s forecasts to draft their budgets.
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The cost of building an artificial intelligence product like ChatGPT can be hard to measure.

But one thing Microsoft-backed OpenAI needed for its technology was plenty of water, pulled from the watershed of the Raccoon and Des Moines rivers in central Iowa to cool a powerful supercomputer as it helped teach its AI systems how to mimic human writing.

As they race to capitalize on a craze for generative AI, leading tech developers, including Microsoft, OpenAI and Google, have acknowledged that growing demand for their AI tools carries hefty costs, from expensive semiconductors to an increase in water consumption.

But they’re often secretive about the specifics. Few people in Iowa knew about its status as a birthplace of OpenAI’s most advanced large language model, GPT-4, before a top Microsoft executive said in a speech it “was literally made next to cornfields west of Des Moines.”

Building a large language model requires analyzing patterns across a huge trove of human-written text. All that computing takes a lot of electricity and generates a lot of heat. To keep it cool on hot days, data centers need to pump in water — often to a cooling tower outside its warehouse-sized buildings.

In its latest environmental report, Microsoft disclosed that its global water consumption spiked 34% from 2021 to 2022 (to nearly 1.7 billion gallons, or more than 2,500 Olympic-sized swimming pools), a sharp increase compared to previous years that outside researchers tie to its AI research.

“It’s fair to say the majority of the growth is due to AI,” including “its heavy investment in generative AI and partnership with OpenAI,” said Shaolei Ren, a researcher at the University of California, Riverside, who has been trying to calculate the environmental impact of generative AI products such as ChatGPT.

In a paper due to be published later this year, Ren’s team estimates ChatGPT gulps up 500 milliliters of water (close to what’s in a 16-ounce water bottle) every time you ask it a series of between 5 to 50 prompts or questions. The range varies depending on where its servers are located and the season. The estimate includes indirect water usage that the companies don’t measure — such as to cool power plants that supply the data centers with electricity.

“Most people are not aware of the resource usage underlying ChatGPT,” Ren said. “If you’re not aware of the resource usage, then there’s no way that we can help conserve the resources.”

Google reported a 20% growth in water use in the same period, which Ren also largely attributes to its AI work. Google’s spike wasn’t uniform — it was steady in Oregon, where its water use has attracted public attention, while doubling outside Las Vegas. It was also thirsty in Iowa, drawing more potable water to its Council Bluffs data centers than anywhere else.

In response to questions from The Associated Press, Microsoft said in a statement this week that it is investing in research to measure AI’s energy and carbon footprint “while working on ways to make large systems more efficient, in both training and application.”

“We will continue to monitor our emissions, accelerate progress while increasing our use of clean energy to power data centers, purchasing renewable energy, and other efforts to meet our sustainability goals of being carbon negative, water positive and zero waste by 2030,” the company’s statement said.

OpenAI echoed those comments in its own statement Friday, saying it’s giving “considerable thought” to the best use of computing power.

“We recognize training large models can be energy and water-intensive” and work to improve efficiencies, it said.

Microsoft made its first $1 billion investment in San Francisco-based OpenAI in 2019, more than two years before the startup introduced ChatGPT and sparked worldwide fascination with AI advancements. As part of the deal, the software giant would supply computing power needed to train the AI models.

To do at least some of that work, the two companies looked to West Des Moines, Iowa, a city of 68,000 people where Microsoft has been amassing data centers to power its cloud computing services for more than a decade. Its fourth and fifth data centers are due to open there later this year.

“They’re building them as fast as they can,” said Steve Gaer, who was the city’s mayor when Microsoft came to town. Gaer said the company was attracted to the city’s commitment to building public infrastructure and contributed a “staggering” sum of money through tax payments that support that investment.

“But, you know, they were pretty secretive on what they’re doing out there,” he said.

Microsoft first said it was developing one of the world’s most powerful supercomputers for OpenAI in 2020, declining to reveal its location to the AP at the time but describing it as a “single system” with more than 285,000 cores of conventional semiconductors and 10,000 graphics processors — a kind of chip that’s become crucial to AI workloads.

Experts have said it can make sense to “pretrain” an AI model at a single location because of the large amounts of data that need to be transferred between computing cores.

It wasn’t until late May that Microsoft’s president, Brad Smith, disclosed that it had built its “advanced AI supercomputing data center” in Iowa, exclusively to enable OpenAI to train what has become its fourth-generation model, GPT-4. The model now powers premium versions of ChatGPT and some of Microsoft’s own products and has accelerated a debate about containing AI’s societal risks.

“It was made by these extraordinary engineers in California, but it was really made in Iowa,” Smith said.

In some ways, West Des Moines is a relatively efficient place to train a powerful AI system, especially compared to Microsoft’s data centers in Arizona, which consume far more water for the same computing demand.

“So if you are developing AI models within Microsoft, then you should schedule your training in Iowa instead of in Arizona,” Ren said. “In terms of training, there’s no difference. In terms of water consumption or energy consumption, there’s a big difference.”

For much of the year, Iowa’s weather is cool enough for Microsoft to use outside air to keep the supercomputer running properly and vent heat out of the building. Only when the temperature exceeds 29.3 degrees Celsius (about 85 degrees Fahrenheit) does it withdraw water, the company has said in a public disclosure.
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Established in 1999, the group of 20 – also known as G20 – is an informal gathering between heads of state from 20 of the world’s largest economies. While the annual summit has traditionally focused on economic cooperation, the agenda has since expanded to include talks on how to respond to climate change, the COVID-19 pandemic, and most recently Russia’s war against Ukraine. How do these summits work and what can we expect from the upcoming September meeting in India?
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An American private sector delegation opened meetings in Afghanistan with officials and local counterparts Wednesday in the first interaction since the Taliban seized power from a U.S.-backed government two years ago.

Jeffrey Grieco, president of the Afghan American Chamber of Commerce, or AACC, in the United States, is leading the delegation.

Addressing a televised meeting in Kabul of business representatives that Greico co-hosted with Taliban Deputy Prime Minister for Economic Affairs Abdul Ghani Baradar, he said the U.S. government backs the visit.

U.S. officials did not immediately comment on Greico’s assertion.

The American businessman credited the de facto Afghan authorities for establishing peace in the country, saying they have also “greatly eliminated” corruption. “It’s not all gone, but it’s mostly gone.”

He said his team is seeking to elevate private sector activities and explore ways to ease hardships facing Afghans over the past two years.

“The next year is going to be equally hard as the donors are reducing funding for Afghanistan, both humanitarian food security and other funding, at a key moment when Afghanistan needs funding for humanitarian purposes,” he said.

On Tuesday, the U.N. World Food Program announced that a “massive funding shortfall” had forced it to cut rations for 10 million people in the country this year, warning that time is running out to avert catastrophe in Afghanistan.

“The private sector can be a powerful agent of change and an agent of support when a country like Afghanistan is suffering,” Grieco said at the event, where local women business leaders were also in attendance.

“We think that business is the way to increase knowledge and increase more program activities for the core in Afghanistan, and you are great examples for us,” he told the Afghan female participants.

Barader said in his keynote speech that his government had established nationwide “comprehensive security” and “straightforward investment regulations” to attract domestic and foreign investments in Afghanistan.

The Taliban deputy prime minister cited several mining contracts signed in Kabul last month with Asian and European investors, including some from China, Turkey, Iran and Britain, worth almost $6.5 billion.

Grieco pledged to work closely with Bradar’s office to promote business-to-business ties, stressing the need for the Taliban to ensure security and protection of investment assets.

“What we saw and heard this week is that the Emirate government is ready for a market-based economic system for Afghanistan,” Grieco said, using the official title of the Taliban administration, the “Islamic Emirate of Afghanistan.”

“The last [Afghan] government didn’t even understand what a market-based economic system is,” he said.

The president of the U.S.-based AACC said his team has been working in Washington with banking sector representatives to help facilitate the return of Afghanistan’s frozen foreign exchange reserves of about $9 billion.

Grieco explained to the audience that the funds are in the U.S. central bank and European countries. He noted that the money cannot be returned to Afghanistan’s central bank for the time being due to economic sanctions on the Taliban.

“We need the Afghan Bankers’ Association to work tougher now to figure out how to approach the return of the commercial bank assets because there has been a change in our government’s thinking in the last few months,” Grieco said. “They are now willing to consider the return of those assets.”

While speaking to the Kabul gathering, Arthur Groom, a longtime international gemstone investor in Afghanistan, said that while some U.S. investors left the country after the Taliban takeover, his company stayed.

“We need to change some minds … because all I have heard here in many meetings is that it’s not safe here, women are not happy here, and the kids aren’t going to the schools, it’s dirty here. It’s completely opposite from what I saw,” Groom said.

Groom said his investment in Afghanistan aims to bring technology into the country to modernize the mining sector and teach modern technology in gem-cutting to enable locals, including the government, to benefit from their natural resources.

The Taliban reclaimed power in August 2021 as the U.S.-led NATO troops withdrew from the country after almost 20 years of war with the then-Taliban insurgents.

The new fundamentalist authorities have since imposed their strict interpretation of Islamic law, known as Sharia, banning girls from schools beyond the sixth grade, barring many women from workplaces, including those working for aid agencies, and prohibiting their entry into public parks, gyms and bathhouses.

The restrictions have deterred the international community from recognizing the Taliban government. However, Afghanistan’s neighbors and many regional countries have retained or reopened their embassies in Kabul following the power shift two years ago.

The Taliban said they had established peace in Afghanistan and almost eliminated illicit narcotics production to address international concerns, arguing that their policies align with Afghan culture and Islam.

“The rest is our internal matter, and no one should interfere in it like we don’t interfere in other countries’ affairs,” Taliban Foreign Minister Amir Khan Muttaqi said last week in a speech in Kabul in response to criticism of their treatment of Afghan women and other alleged human rights abuses.
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Fishing grounds choked by water hyacinths. Songbird eggs gobbled up by rats. Power plant pipes clogged by zebra mussels. And electrical lines downed by brown tree snakes.

These are just a few examples of the environmental chaos sown by invasive species, whose spread around the world has seen economic damages quadruple every decade since 1970, scientists said on Monday.

The team of 86 researchers from 49 countries released a four-year assessment of the global impacts of some 3,500 harmful invasive species, finding that economic costs now total at least $423 billion every year, with the alien invaders playing a key role in 60% of recorded plant and animal extinctions.  

“We also know this is a problem that is going to get much, much worse,” said ecologist Helen Roy, co-chair of the United Nations Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services (IPBES)report.

Warmer temperatures under climate change are expected to further drive the expansion of invasive species.

Invasive species are plants or animals, often moved around by human activity, that take hold in an environment with deleterious effects. These range from outcompeting native wildlife, damaging infrastructure, and threatening human health and livelihoods.

Impacts are often slow to materialize, but can be catastrophic when they do.  

The deadly wildfires in Hawaii last month were driven by flammable invasive grasses, scientists said, brought over from Africa as livestock pasture. 

Invasive mosquito species, too, can spread diseases such as dengue, malaria, Zika, and West Nile.

“Invasive species are affecting not only nature but also people and causing terrible loss of life,” said report co-chair Anibal Pauchard of Chile’s Institute of Ecology and Biodiversity.

Eradicating invaders

About three-quarters of the negative impacts from invasive species occur on land, especially in forests, woodlands, and farmed areas.

While invasives can come in many forms, including microbes, invertebrates and plants, animals often have the greatest environmental impact, Roy said, particularly predators.

On islands, many species have evolved without predators and are therefore “very naive,” said Pauchard, with few defenses. “Birds in New Zealand had no experience with rats until humans came and brought rats. Their nests are at ground level.”

Getting rid of invasive species once they are established, however, is difficult.

Some small islands have seen success in eradicating invasive rats and rabbits with trapping and poisonings. But larger populations that are quick to reproduce can be tricky. And invasive plants often leave their seeds lying dormant in the soil for years.

Prevention measures through border biosecurity and import controls, scientists said, is most effective.

Last December, the world’s governments committed in the Kunming-Montreal Global Biodiversity Framework to reducing the introduction and establishment of priority invasive species by at least 50 percent by 2030. 
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China’s economic growth is slowing down as policymakers try to fix a property market downturn, with troubles at major developer Country Garden in focus. Concerns are mounting over whether the world’s second-largest economy is coming closer to a crunch point:

What is causing China’s economic slowdown?

Unlike consumers in the West, Chinese people were left largely to fend for themselves during the COVID-19 pandemic and the revenge spending spree that some economists expected after China reopened never took place.

Moreover, demand for Chinese exports has been softening as key trading partners have been grappling with rising living costs.

And with 70% of Chinese household wealth tied up in real estate, a big slowdown in the sector is trickling through to other parts of the economy.

There have been major concerns over China’s economy before. Is this time different?

Alarm bells over the economy rang during the global financial crisis in 2008-09 and during a capital outflow scare in 2015. China revived confidence then with a shock boost to infrastructure investment and by encouraging property market speculation, among other measures.

But the infrastructure upgrades have created too much debt, and the property bubble has burst, posing risks to financial stability today.

Given China’s debt-fueled investment in infrastructure and property has peaked and exports are slowing in line with the global economy, China only has one other source of demand to tinker with: household consumption.

In that sense, this slowdown is different.

Whether China bounces back largely depends on whether it can convince households to spend more and save less, and whether they will do so to such an extent that consumer demand compensates for weaknesses elsewhere in the economy.

Why is low household spending a problem?

Household consumption, as a percentage of gross domestic product (GDP), was among the lowest in the world even before COVID, with economists identifying it as a key structural imbalance in an economy relying too heavily on debt-fueled investment.

Economists blame weak domestic demand for subdued investment appetite in the private sector and for China sliding into deflation in July. If it persists, deflation could exacerbate the economic slowdown and deepen debt problems.

The imbalance between consumption and investment is deeper than Japan’s before it entered its “lost decade” of stagnation in the 1990s.

Will China’s economic slowdown get worse?

Weak data readings have prompted some economists to flag the risk that China may struggle to meet its economic growth target of about 5% for 2023 without more government spending.

About 5% is still a much higher growth rate than many other major economies will achieve, but for one that invests roughly 40% of its GDP every year – about twice as much as the United States – economists say it remains a disappointing figure.

There is also uncertainty about the government’s appetite for large fiscal stimulus, given high levels of municipal debt.

Stress in the property market, which accounts for about a quarter of economic activity, raises further concern about the ability of policymakers to arrest the slide in growth.

Some economists warn that investors will have to get used to much lower growth. A minority of them even raise the prospect of Japan-like stagnation.

But other economists say many consumers and small businesses may already feel economic pain as deep as during a recession, given youth unemployment rates above 21% and deflationary pressures weighing on profit margins.

Will interest rate cuts help?

Major Chinese banks on Friday cut interest rates on a range of yuan deposits, to mitigate pressure on their profit margins and give themselves room to reduce lending costs for borrowers, including by lowering mortgage rates.

While policymakers hope lower rates would boost consumption, economists warn the deposit rate cuts accompanying them result in a transfer of funds from consumers who save to those that borrow. Transfers of resources from the government sector to households would make a more meaningful long-term impact.

Rate cuts may also create risks of yuan depreciation and capital outflows, which China will be keen to avoid.

China’s central bank said on Friday it will cut the amount of foreign exchange that financial institutions must hold as reserves for the first time this year, to counter pressure on the yuan.

What more can China’s government do?

Economists want to see measures that would boost the household consumption share of the GDP.

Options include government-funded consumer vouchers, significant tax cuts, encouraging faster wage growth, building a social safety net with higher pensions, unemployment benefits and better, and more widely available, public services.

No such steps were flagged at a recent Communist Party leadership meeting, but economists are looking to a key party conference in December for more profound structural reforms.
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Merchants throughout Pakistan closed their shops Saturday to protest the country’s steep electricity bills and mounting inflation.

The general public has already mounted protests about Pakistan’s soaring cost of living. 

“Everyone is participating” in the shutdown, Lahore’s Township Traders Union president, Ajmal Hashmi, told AFP, “because the situation has become unbearable.”

A deal with the International Monetary Fund has forced Pakistan to cut popular subsidies that helped cushion true costs.

Meanwhile, Pakistan’s caretaker prime minister, Anwaarul Haq Kakar, has said the high prices are not an issue because there is no “second option.”

“When you subsidize, you shift your fiscal obligations to the future,” he said. “Rather than addressing the issue, you just delay it.”
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Afghanistan’s Taliban announced Thursday they have signed more than $6.5 billion worth of mining contracts with local and foreign companies from China, Iran, Turkey and Britain.

Shahabuddin Dilawar, the Taliban minister of mines and petroleum, said the seven contracts cover the extraction and processing of gold, copper, iron, lead and zinc in four Afghan provinces — Takhar, Ghor, Herat and Logar.

The nationally televised signing ceremony occurred as the de facto Afghan authorities marked the second anniversary of the withdrawal of all U.S.-led NATO troops from the country after nearly 20 years of war with the then-insurgent Taliban.

Dilawar said the seven contracts signed Thursday “will collectively bring a $6.557 billion investment” and create thousands of jobs in Afghanistan.

The minister said that an agreement awarded to a Chinese company for gold extraction in Takhar would bring the Taliban government a 65% share of the earnings over five years.

Dilawar said other contracts involving Turkish, Iranian and British investments for mining and processing iron ore in Herat would earn the government a 13% share over 30 years. “It will eventually turn Afghanistan into an exporter of iron,” he said.

Skeptics question the viability of the contracts, citing international economic sanctions imposed on the country after the Taliban reclaimed power in August 2021.

“The Afghan financial and banking sector is almost paralyzed and dysfunctional. Hence, no financial transactions or valuations,” Tamim Asey, a former official with the Afghan ministry of mines and petroleum, wrote on X, formerly known as Twitter.

He argued that the Afghan ministry “lacks technical-legal-police capacity” to manage and oversee such mining contracts.

“The legal-policy framework for the mining sector is not only vague but almost nonexistent. The regime doesn’t even have a constitution, let alone mining legal framework,” Asey said.

Earlier this year, a Chinese firm signed an oil extraction contract with the Taliban administration. Beijing lately has also shown interest in investing in lithium mining in Afghanistan.

The landlocked South Asian country reportedly has more than $1 trillion worth of precious minerals, including deposits of highly sought-after lithium used in rechargeable batteries.

The Taliban have stabilized Afghanistan’s economy and increased trade with neighboring and other countries, according to regional officials and independent monitors.

The World Bank said in its report last month that “the year-on-year inflation has been negative” for the past two months in Afghanistan.

“The supply of goods has been sufficient, but demand is low. Over 50% of Afghan households struggle to maintain their livelihoods and consumption,” the report said. It added that the local currency, the Afghani, appreciated against major trading currencies in the first seven months of 2023.

But the Taliban’s men-only government in Kabul remains under fire from the world because of its restrictions on women’s access to work and education.

Since seizing power from a U.S.-backed Afghan government on Aug. 15, 2021, the Taliban have imposed their strict interpretation of Islamic law, or Sharia, in the conflict-torn nation.

Edicts from reclusive Taliban supreme leader Hibatullah Akhundzada primarily set the policy guidelines for his government.

Akhundzada has banned girls from attending schools past the sixth grade and most women from working for the government and nongovernmental aid groups in a country where two-thirds of the population needs humanitarian assistance. The Taliban have closed thousands of women-run salons nationwide. Women are barred from visiting public parks and gyms and undertaking road trips without a male guardian.

The treatment of Afghan women has deterred foreign governments from recognizing the Taliban administration in Kabul, known as the Islamic Emirate of Afghanistan.

The last American soldier departed Afghanistan on Aug. 30, 2021, ending the longest war in U.S. history.

On Wednesday, President Joe Biden defended his troop exit decision in a statement marking the second anniversary of ending the Afghan war.

“We have demonstrated that we do not need a permanent troop presence on the ground in harm’s way to take action against terrorists and those who wish to do us harm,” Biden said.

The president referred to the July 30, 2022, drone strike that killed al-Qaida leader Ayman al-Zawahiri in his home in downtown Kabul.
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