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More U.S. drivers could find themselves stuck on snowy highways or have their travel delayed this winter due to a shortage of snowplow drivers — a reality that could hit home Friday as winter storms start dumping snow from the Intermountain West to the Upper Great Lakes.

States from Washington to Pennsylvania, including Montana and Wyoming in the Rocky Mountains, are having trouble finding enough people willing to take the comparatively low-paying jobs that require a Commercial Driver’s License and often entail working at odd hours in dangerous conditions.

“We want the traveling public to understand why it could take longer this season to clear highways during winter storms,” said Jon Swartz, the maintenance administrator for the Montana Department of Transportation, which is short about 90 drivers. “Knowing this helps motorists to plan ahead and adjust or even delay travel plans.”

The labor shortage and lingering concerns about the pandemic have left employers scrambling to find enough school bus drivers, waiters, cooks and even teachers. The shortage comes as the number of Americans applying for unemployment benefits dropped last week to the lowest level in 52 years and some are seeking a better work-life balance.

Several states are either already feeling the crunch or could be soon: Heavy snow is predicted in the coming days in large swaths of the country, including Utah and Colorado, where more than a foot (30 centimeters) is forecast in higher elevations. Over a half a foot could drop in parts of Nebraska and Iowa. Parts of Nevada and New Mexico also expect winter storms.

State transportation departments say there are several reasons for a lack of snowplow drivers: the record low unemployment rate, an aging workforce and an increased demand for diesel mechanics and CDL drivers in other industries. Private companies can also be more nimble — raising salaries and offering bonuses to drivers — than state agencies, which usually have to get legislative approval to change salaries.

“Everyone’s sort of competing for the same group of workers and private companies can often offer higher salaries than the state government,” said Barbara LaBoe, spokesperson for Washington state’s Department of Transportation.

Along with the competitive market, LaBoe said Washington also lost 151 winter operations workers who did not want to comply with the state’s COVID-19 vaccine mandate.

One of the main competitors for states seeking workers with a Commercial Driver’s License are private trucking companies that have been raising driver pay, in some cases several times this year, to fill their own shortages and meet the increasing demand to move freight and clear supply chain bottlenecks.

The American Trucking Associations estimates there will be a record shortage of just over 80,000 drivers this year, and that doesn’t include the shortfall in drivers for school buses, public transportation or snowplows.

The ATA says the shortage has many roots, including many drivers nearing retirement age, the pandemic causing some to leave the industry and training schools churning out fewer new drivers in 2020. Others may leave the industry because they don’t like being away from home while an increase in the number of states legalizing marijuana leads to more drivers being unable to pass a drug test, the ATA says.

Some states are willing to hire snowplow drivers and pay for their CDL training, but it’s not likely those hires will be ready to work this winter, officials said.

Some snowplow drivers work year-round in highway maintenance jobs, while seasonal workers are hired to fill the additional shifts in the winter.

The shortage is leading states to make plans to shift mechanics and other full-time employees who have Commercial Driver’s Licenses into plows, which can cause problems if a plow needs maintenance work and the mechanic is out driving.

Wyoming has priorities for which roads will be plowed first and for how many hours per day plows will operate on each roadway. Interstate 80, the major east-west corridor across the southern part of the state, can be plowed around the clock while plowing stops on other roads, such as Interstates 90 and 25, between midnight at 4 a.m. Those guidelines may come into play more this year, said Luke Reiner, director of Wyoming’s Department of Transportation.

In Washington, LaBoe said some roads and mountain passes will be closed longer than usual during and after significant storms and some roads may not receive the same level of service.

Brief or isolated storms won’t cause problems in most states, in part because departments can move drivers and equipment around based on the weather forecast.

“If we have a series of storms over several days or if it hits the whole state at once, (the shortage) is going to become more evident because we don’t have as deep a bench,” LaBoe said.

Washington is still short about 150 seasonal and full-time workers, but things have improved since October when it was short 300 workers.

Even if states are able to hire drivers with commercial licenses, they still have to train them to run a snowplow and load the truck with salt and sand before learning a route.

“When you’re plowing the road you need to know where the bridge abutment is and where the expansion joints are so you don’t hook that with a plow,” LaBoe said.

Pennsylvania is short 270 permanent positions and 560 temporary ones, but the Department of Transportation said that doesn’t mean the roads will be treacherous this winter.

“Our goal is to keep roads safe and passable rather than completely free of ice and snow,” said Alexis Campbell, spokesperson for the Pennsylvania Department of Transportation. The roads will be cleared once the snow stops, she said.

Ease of travel is important to businesses. Capitol Courier has contracts with deadlines to deliver electronic replacement parts from their warehouse in Helena, Montana, to about 30 businesses around the state as soon as they call.

“The roads are critical to what we do,” said Shawn White Wolf, co-manager of Capitol Courier.

Snowplow drivers are devoted to their jobs, understanding their work is critical to the safety of the traveling public and to emergency responders, said Rick Nelson director of the winter maintenance technical service program for the American Association of State Highway and Transportation Officials.

Still, he understands that convincing newcomers “to be out there in the worst conditions” can be difficult.

Nelson said the shortage means states will be shifting resources when they can and making sure roads are clear during times of peak demand while “you try to recruit, get out there and beat the bushes and convince folks that jumping in a plow in the middle of the night at Christmastime is a good career choice.”
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The price of U.S. consumer goods, such as food, fuel and rent, rose at the fastest pace since 1982 in November, according to a Department of Labor report Friday.

The 6.8% increase was the highest since June of 1982. The November rate follows a 6.2% increase in October.

Even with more volatile items such as food and energy stripped out, core inflation was up 4.9%, the biggest increase since 1991.

Energy prices in the United States surged by 3.5% in November and are up more than 33% for the year. Gasoline, for example, is 58% higher than it was a year ago.

The price of food has risen by 6.1% over the past year, and the price of used cars and trucks is up 31% for the year.

The steep surge in the cost of everyday goods has hurt lower income workers the most and is negating wage gains seen as employers try to lure Americans back into the workforce with higher wages.

The Biden administration blames COVID-19 pandemic-related economic disruptions for the inflation surge, while Republicans say price increases are being caused by massive government spending in response to the pandemic.

Inflation threatens Biden’s signature “Build Back Better” $1.7 trillion spending bill, which was passed by the House of Representatives and is being considered by the Senate.

Democratic Senator Joe Manchin this week warned against flooding the market with more money while speaking at a CEO summit sponsored by The Wall Street Journal newspaper.

Many economists think persistent inflation could also influence the U.S. central bank’s future actions. Federal Reserve Chair Jerome Powell once called inflation “transitory,” but two weeks ago signaled the Fed may have to act quickly to raise interest rates to restrain rising costs.

Some information in this report comes from The Associated Press.
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The U.S. Senate took a step toward raising the federal government’s $28.9 trillion debt limit on Thursday when it voted to limit debate on the first of two necessary measures, as the Treasury Department urged action by next week. 

Fourteen Republican senators joined the Senate’s 48 Democrats and two independents in voting to advance the first of two bills needed to increase the Treasury Department’s borrowing authority under a deal crafted by Senate Majority Leader Chuck Schumer and Republican Leader Mitch McConnell. 

The Senate voted 64-36 to clear the way for passage of the bill setting up the fast-track procedure. 

The chamber could vote on the bill itself, which sets the fast-track rules to raise the debt limit, as early as Friday. If that bill passes, both chambers of Congress would need to vote next week on a second bill actually raising the debt limit. 

President Joe Biden is expected to sign both bills into law once they pass. 

The House of Representatives on Tuesday approved this first bill to sidestep the Senate’s “filibuster ” rule and ultimately raise federal borrowing authority by a simple majority vote. 

“I’m optimistic that after today’s vote we will be on a glide-path to avoid a catastrophic default,” Schumer said in a speech to the Senate. 

The Schumer-McConnell deal on the debt ceiling is contained in legislation that would avoid funding cuts for Medicare, the government health insurance program for the elderly, which has wide bipartisan support. 

The deal comes just two months after Congress agreed on a short-term lift to the debt ceiling, to avert an unprecedented default by the federal government on its obligations, which would have catastrophic implications for the world economy. 

Republicans have been trying to withhold their votes for more borrowing authority, contending the increase would smooth the way for passage of President Joe Biden’s $1.75 trillion “Build Back Better” domestic investment bill, which they oppose. 

Democrats note that the legislation is needed to finance debt largely incurred during Donald Trump’s administration, when Republicans willingly jacked up Washington’s credit card bill by about $7.85 trillion, partly through sweeping tax cuts and spending to fight the COVID-19 pandemic. 

But most Senate Republicans, looking to score political points by blaming Democrats for spending, opposed the deal. Republicans contend that “irresponsible,” “socialist” spending pushed by Biden is fueling the need for the debt limit increase. 

Treasury Secretary Janet Yellen has urged Congress to act by Dec. 15, and the Bipartisan Policy Center think thank warned last week that the government could risk default by late this month if Congress does not act. 

Democrats noted that they had voted in the past to authorize debt ceiling hikes to cover Republican measures, such as the Trump tax cuts. 

The draft bill still must plug in a dollar amount for the new statutory debt limit, which likely is being calibrated to give the government enough borrowing authority to extend beyond next November’s congressional elections. 

“Every single Senate Democrat will have to put their name to the gigantic dollar amount of debt they’re prepared to pile on the American people,” McConnell said in a speech on Wednesday.
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The number of Americans applying for unemployment benefits plunged last week to the lowest level in 52 years, more evidence that the U.S. job market is recovering from last year’s coronavirus recession.

Unemployment claims dropped by 43,000 to 184,000 last week, the lowest since September 1969, the Labor Department said Thursday. The four-week moving average, which smooths out week-to-week volatility, fell to below 219,000, lowest since the pandemic hit the United States hard in March 2020.

Overall, just under 2 million Americans were collecting traditional unemployment benefits the week that ended Nov. 27.

Weekly claims, which are a proxy for layoffs, have fallen steadily most of the year since topping 900,000 one week in early January. They are now below to the 220,000-a-week level typical before the coronavirus pandemic slammed the U.S. economy in March 2020; COVID-19 forced consumers to stay home as health precaution and businesses to close or reduce hours and to lay off staff. In March and April last year, employers shed a staggering 22.4 million jobs.

Massive government aid and the rollout of vaccines helped revive the economy and the job market by giving Americans the confidence and financial wherewithal to go on a shopping spree, often online, for goods such as lawn furniture and coffee makers. Since April last year, the United States has regained nearly 18.5 million jobs. But the economy is still 3.9 million jobs short of where it stood in February 2020 and the prospects for the economy remain vulnerable to COVID variants such as omicron.

The Labor Department reported last week that employers added a disappointing 210,000 jobs last month. But the report also showed that the unemployment rate dropped to a pandemic low of 4.2% from 4.6% in October.  

And the department reported Wednesday that employers posted a near-record 11 million job openings in October. It also said that 4.2 million people quit their jobs — just off the September record of 4.4 million — a sign that they are confident enough in their prospects to look for something better.

Until Sept. 6, the federal government had supplemented state unemployment insurance programs by paying an extra payment of $300 a week and extending benefits to gig workers and to those who were out of work for six months or more. Including the federal programs, the number of Americans receiving some form of jobless aid peaked at more than 33 million in June 2020.
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India has posted the fastest pace of growth among major economies, raising hopes of a revival in its pandemic-hit economy. But fears of the omicron variant have triggered concerns of whether the pace can be sustained even as economists warn that unemployment levels are still high in a country where millions lost jobs during the pandemic. 

India’s gross domestic product grew 8.4% from July to September this year compared to the same period last year, according to a government report.

While economies worldwide were hit hard due to the pandemic, India slipped into its worst recession in four decades last year with its economy shrinking by 7.3% after the Indian government imposed one of the toughest lockdowns in the world.

But there has been a significant turnaround in recent months with growth returning to levels before the pandemic, according to officials. “Data clearly shows that corporate income and profit are above the pre-pandemic level,” K.V. Subramanian, chief economist at the Finance Ministry said as he released the latest economic data. 

The International Monetary Fund, IMF, has forecast growth of 9.5% for India in 2021 — if the growth stays on track, it would be fastest among major economies in the world, surpassing its projections of about 8% for China. 

“What happens in India has a big impact, both in the region and in the world,” Luis Breuer, the IMF’s senior resident representative to India, said last month. “You’re talking about a large slice of humanity and the global economy.”

Normalcy returning 

Experts say the opening of the economy as the pandemic waned after a deadly second wave in April and May and significant progress in the country’s vaccination program have helped the revival.

India has lifted all restrictions in recent months as cases decline to their lowest in a year and a half — the country has been reporting less than 10,000 new infections a day in recent weeks. 

After spending a year indoors, people keen to get a sense of normalcy have crowded markets, hotels are booked as vacationers head out for holidays and streets in mega cities like Delhi and Mumbai are choked with traffic. That is helping a country whose economy is driven largely by millions of middle-class consumers. 

India’s recent festive season saw shops and malls do brisk business. “We did no business at all for nearly a year, but customers have started ordering clothes from us since August this year,” Geeta Mehra, a boutique clothes retailer, told VOA. “Weddings that had been on hold for the last year and a half are now taking place which has resulted in good sales for us.”

However, she is cautious about increasing stocks and employing more people as fears of the new Omicron variant raise fresh concerns about the pandemic. India is now among nearly 30 countries where it has been found. Health authorities had reported 23 cases by Tuesday. 

Uneven recovery 

Some businesses, however, have still to recover. “Our business is only 20% of the pre-pandemic levels,” said Sanjay Kapur, a stationery retailer since the last 22 years. “Stationery requirement has become minimal as offices and schools are still closed and most work is done online. We can only wait and watch.

The threat of the Omicron variant looms large over people like Kapur — they worry it may keep offices and schools shut for longer than expected. And although the government has said it is not imposing any additional restrictions, curbs on international travel have been imposed. 

Experts have described the recovery as uneven and fractured. 

“The organized sector is looking up whereas the unorganized sector is not doing so well. Even within the organized sector some economic activities are performing better than others,” said Santosh Mehrotra, professor and chairperson of the Centre for Informal Sector and Labor Studies at Jawaharlal Nehru University. He points out that while sectors like manufacturing and technology have recovered, hospitality and retail that are among the biggest job creators, are still struggling. 

Chavi Kasaudhan got a job at a retail store at Delhi airport recently. “I was lucky to get a break but many of those who did a six-month course in hospitality and retail with me are still waiting,” the 20-year-old said. 

While jobs have been returning, millions are still struggling to find work, especially in the country’s vast informal sector that includes farm workers, street vendors, laborers, and rickshaw pullers. 

Economists say official numbers do not reflect how this sector, where an estimated 90% of people work, is faring.

“What is not being captured by data is the fact that unemployment levels are very high,” Jawaharlal Nehru University’s Mehrotra said. Mehrotra estimates that the pandemic has added an additional 15 million to the number of poor people in the country, which represents a reversal of gains made in recent decades in alleviating poverty. 

Still, there is optimism that Asia’s third largest economy is turning a corner, and the stress of the pandemic could be subsiding.

Suhasini Sood contributed to this story.
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Lebanon’s dire economic crisis is threatening to cancel Christmas for many people. The Lebanese currency has lost more than 93 percent of its value against the dollar over the past two years and soaring inflation is making it difficult for ordinary people to buy food and medicine, let alone Christmas trees and gifts.

With Christmas trees now costing between $80 to $120 dollars, almost double a Lebanese worker’s monthly salary, some are resorting to telling their children that Santa Claus is sick this year and won’t be able to bring them presents simply because parents are unable to buy the gifts. Most are struggling just to purchase food and medicine.

The U.N. children’s agency, UNICEF, reports that 77 percent of Lebanese families say they lack sufficient food and 60 percent of them only buy food by running up unpaid bills or borrowing money.

Political analyst Dania Koleilat Khatib, with the Issam Fares Institute at the American University of Beirut, said to VOA, “…although you may see some people shopping and think things are well, that’s not the situation for most Lebanese.”

“People who live from paycheck to paycheck, they are suffering big time. These people will not see Santa, will not see Christmas, will not see anything. You get shocked when you go to restaurants. The people in restaurants, they represent how much of the Lebanese society? They’re not 1 or 2 percent. The majority are very poor,” said Khatib.

But in the upscale northern seaside resort of Batroun, it’s hard to see Lebanon’s financial woes. It has just opened its first Christmas market which organizer Francois Baraket said he hopes will rival those in Europe in years to come. It has drawn Lebanese with money to spend, he told Dubai’s The National newspaper.

Dania Koleilat Khatib said those Lebanese who have money now receive help with hard currency from family abroad or are those who work with international agencies. Others may have been lucky enough to withdraw U.S. currency from the bank before the government froze dollar accounts. Christmas will also witness a number of Lebanese expats return home to celebrate with family.

“At Christmas you will see celebration because a lot of people are coming from outside. But that doesn’t mean that people are better off. This is always the issue with Lebanon because you have a lot of expats coming in and out. If we didn’t have this influx of hard currency from outside into Lebanon, people would be ‘dog eat dog.’ It would be much worse,” said Khatib.

The U.N’s World Food Program estimates that poverty in Lebanon has almost doubled this past March, affecting three million people compared with 1.7 million in 2020.
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U.S. senators struck a deal Tuesday to create a one-time law allowing Democrats to lift the nation’s borrowing authority and avoid a credit default without requiring votes from the opposition Republicans. 

The House of Representatives approved the fix in an evening vote. It is expected to be approved by the Senate in the coming days, allowing lawmakers to avert the crisis with a simple 51-vote majority in the upper chamber. 

The Bipartisan Policy Center said last week it expected the United States would no longer be able to meet its debt repayment obligations between December 21 and January 28. U.S. Treasury Secretary Janet Yellen has put the deadline even earlier: next Wednesday. 

“Nobody wants to see the U.S. default on its debts. As Secretary Yellen has warned, a default could eviscerate everything we’ve done to recover from the COVID crisis,” Democratic Senate Majority Leader Chuck Schumer said on the floor of the chamber. 

“We don’t want to see that, I don’t believe we will see that, and I continue to thank all my colleagues for cooperating in good faith to preserve the full faith and credit of the United States,” he said. 

America spends more money than it collects through taxation so it borrows money via the issuing of government bonds, seen as among the world’s most reliable investments. 

Around 80 years ago lawmakers introduced a limit on how much federal debt could be accrued. 

The ceiling has been lifted dozens of times to allow the government to meet its spending commitments, usually without drama and with the support of both parties, and stands around $29 trillion. 

Democratic leaders have spent weeks underlining the havoc that a default would have wrought, including the loss of an estimated 6 million jobs and $15 trillion in household wealth, as well as increased costs for mortgages and other borrowing. 

But Republicans in both chambers of Congress initially objected to helping raise the limit, saying they refused to support what they called President Joe Biden’s reckless taxing and spending plans. 

In reality, both parties see raising the borrowing cap as politically toxic, and Republicans hope to make it an issue in the 2022 midterm election campaign. 

Under the complex, multistep compromise proposed Tuesday, the Republicans can essentially stand on the sidelines, offering help to create the new law but offering no votes to increase the limit.

Congress would have to specify the exact dollar amount of a new borrowing cap — likely upwards of $30 trillion.

After the Senate has followed the House in approving the new process, both chambers are expected to pass the extension by simple majority votes ahead of the deadline. 

Crucially, Mitch McConnell, the leader of the Republicans in the Senate, is backing the process. 

“I think this is in the best interest of the country, by avoiding default,” he told reporters when questioned about the convoluted approach. 

 
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After lurching from deadline to deadline, China Evergrande Group is again on the brink of default, with pessimistic comments from the property developer raising expectations of direct state involvement and a managed debt restructuring.

Having made three 11th-hour coupon payments in the past two months, Evergrande will again face the end of a 30-day grace period on Monday, with dues this time at $82.5 million. 

But a statement late on Friday saying creditors had demanded $260 million and that it could not guarantee enough funds for coupon repayment prompted authorities to summon its chairman – and wiped over a sixth off its stock’s market value on Monday.

Evergrande was once China’s top-selling developer but is nowgrappling with more than $300 billion in liabilities, meaning a collapse could ripple through the property sector and beyond.

Its statement on Friday was followed by one from authorities in its home province of Guangdong, saying they would send a team to Evergrande at the developer’s request to oversee risk management, strengthen internal control and maintain operations.

The central bank, banking and insurance regulator and securities regulator also released statements, saying risk to the broader property sector could be contained.

Short-term risk from a single real estate firm will not undermine market funding in the medium or long term, said the People’s Bank of China. Housing sales, land purchases and financing “have already returned to normal in China”, it said.

Analysts said authorities’ concerted effort signaled Evergrande has likely already entered a managed debt-asset restructuring process to reduce systemic risk.

Morgan Stanley in a report said such a process would involve coordination between authorities to maintain normal operation of property projects, and negotiation with onshore creditors to ensure financing for projects’ development and completion.

Regulators would also likely facilitate debt restructuring discussion with offshore creditors after business operations start to stabilize, the U.S. investment bank said. 

After the flurry of statements, Evergrande’s stock slid as much as 15% on Monday to HK$1.92 – its lowest since May 2010.

Its November 2022 bond – one of two bonds that could go into default on non-payment on Monday – was trading at the distressed price of 20.787 U.S. cents on the dollar, compared with 20.083 cents at the end of Friday.

Liquidity squeeze

Evergrande has been struggling to raise capital by disposing of assets, and the government has asked Chairman Hui Ka Yan to use his wealth to repay company debt.

The firm is just one of a number of developers facing an unprecedented liquidity squeeze due to regulatory curbs on borrowing, causing a string of offshore debt defaults, credit-rating downgrades and sell-offs in developers’ shares and bonds.

To prevent further turmoil, regulators since October have urged banks to relax lending for developers’ normal financing needs and allowed more real estate firms to sell domestic bonds.

To free up funds at banks, Premier Li Keqiang on Friday said China will cut the bank reserve requirement ratio (RRR) “in a timely way” to increase support for the real economy.

Still, the government may have to significantly step up policy-easing measures in the spring to prevent a sharp downturn in the property sector, Japanese investment bank Nomura said in a report published on Sunday. 

Contagion

Smaller developer Sunshine 100 China Holdings Ltd on Monday said it had defaulted on a $170 million U.S. dollar bond due Dec. 5 “owing to liquidity issues arising from the 

adverse impact of a number of factors including the macroeconomic environment and the real estate industry.”

The delinquency will trigger cross-default provisions under certain other debt instruments, the developer said.

Its shares fell nearly 3%.

Last week, Kaisa Group Holdings Ltd – the largest offshore debtor among Chinese developers after Evergrande – said it had failed to secure approval from offshore bondholders to carry out an exchange offer of its 6.5% offshore bonds due Dec. 7, without which it said it would risk default.

The developer has begun talks with some of the offshore bondholders to extend the deadline for the $400 million debt repayment, sources have told Reuters.

Smaller rival China Aoyuan Property Group Ltd last week also said creditors have demanded repayment of $651.2 million due to a slew of credit-rating downgrades, and that it may be unable to pay due to a lack of liquidity.
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The Turkish lira has been hitting new record lows against the U.S. dollar in recent days. That is raising alarm among Turkish businessowners. VOA’s Ezel Sahinkaya has this report, narrated by Begum Ersoz.
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U.S. employers added only 210,000 jobs in November, the Labor Department reported Friday, dampening hopes the economy is rebounding from a summer slowdown sparked by the highly contagious delta variant of the coronavirus and supply chain disruptions.

Millions of Americans laid off during the pandemic-induced recession remained without work last month despite employers offering higher wages, expiring unemployment benefits and schools reopening. This has fueled questions among economists about whether some people are willing to reenter the workforce during the ongoing pandemic.

The report fell far short of expectations of about 550,000 new jobs last month, according to economists polled by Reuters. Last month’s 210,000 new jobs were also far fewer than the 546,000 jobs added in October and the year’s monthly average of 555,000. There were 194,000 new hires in September.

The unemployment rate in November fell to 4.2% from 4.6% the month before, inching closer to the pre-pandemic rate of 3.5 percent, the lowest rate in more than 50 years.

“Our economy is markedly stronger than it was a year ago and today the incredible news (is) that our unemployment rate has fallen to 4.2%. At this point in the year, we’re looking at the sharpest one-year decline in unemployment ever. Simply put, America is back to work,” U.S. President Joe Biden said at the White House Friday.

“The unemployment rate has now fallen by more than two percentage points since I took office,” Biden added. “That’s the fastest decline in a single year on record.”  

November’s modest job gains and the spread of the omicron variant of COVID-19 could weaken expectations for stronger economic growth in the fourth quarter. The economy is currently expected to grow at a 7% annual rate in the fourth quarter, a strong rebound from the 2.1% pace in the third quarter, when the delta variant stymied growth.

While little is known about the omicron variant, some slowdown in hiring is likely, considering the delta variant triggered the slowest pace of economic growth in more than a year last quarter.

Some information for this report came from The Associated Press and Reuters.
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Chinese authorities have approved the Boeing 737 MAX to resume service after making a series of safety adjustments, removing a major uncertainty surrounding the American aviation giant’s comeback after a lengthy slump.

A directive from the Civil Aviation Administration of China (CAAC) deeming the model “airworthy” sets the stage for the jet to return to airline schedules in the country next year, following months of negotiations between Beijing and Boeing.

Shares of Boeing rocketed after the decision, which also clears the way for it to deliver more than 100 MAX aircraft to Chinese carriers that were produced during the more than two years the plane was grounded in China following two deadly crashes.

The CAAC said in a further statement Friday that it expects “commercial operation of the existing domestic fleet will be resumed progressively at the end of this year or early next year.”

News of the decision had initially emerged on Thursday, when AFP saw a government directive showing China was giving the green light to the 737 MAX after taking “corrective actions.” The CAAC statement on Friday confirmed the decision.

The CAAC’s move also confirms a place for the US plane maker in the country — an essential growth market in aviation — despite persistent trade and political tensions between Washington and Beijing.

“This will give Boeing the assurance to begin to ramp plane production back up,” said Michel Merluzeau, an analyst at AIR consultancy, adding that the action amounts to the “light at the end of the tunnel” for the MAX.

Protracted process

China is the last major travel market to bring the MAX back into use after it was grounded globally in March 2019 following two crashes that together claimed 346 lives.

Investigators said a main cause of both tragedies was a faulty flight handling system known as the Maneuvering Characteristics Augmentation System (MCAS).

Boeing won approval from the United States in November 2020 and from most other leading aviation authorities soon after to resume service.

But the process was far more protracted in China, with the CAAC only conducting a test flight of the model in the third quarter of this year.

Analysts said delays may have been a consequence of tensions with Washington.

But on Thursday, Chinese authorities gave the green light after requiring upgrades to planes, including installing new software programs to address the defect and updating the flight manual.

“After conducting sufficient assessment, CAAC considers the corrective actions are adequate to address this unsafe condition,” said an airworthiness directive from the authority.

The directive means there are no remaining regulatory obstacles for the MAX to return to the skies in China, although the aviation authority cautioned that it does not mean the planes will immediately return to use.

“Obtaining airworthiness is just one of the most basic tasks,” said the CAAC on Friday.

It added that domestic airlines will still have to “complete aircraft modification, restoration of parked aircraft, pilot training and so on.”

Symbiotic relationship

Boeing cheered the decision.

“CAAC’s decision is an important milestone toward safely returning the 737 MAX to service in China,” Boeing in China said in a statement to AFP.

“Boeing continues to work with regulators and our customers to return the airplane to service worldwide.”

A Boeing spokesperson said more than 180 countries have now allowed the MAX to return to service, with Indonesia, where the first crash took place, and Russia among those that have yet to do so.

Burkett Huey, an analyst at Morningstar, said Boeing still faces some important hurdles such as restoring deliveries of the 787 Dreamliner plane, its other top-selling aircraft, and beefing up its order book following cancelations and the hit from the COVID-19 aviation downturn.

But Huey called the CAAC move “very good news and very consequential” for Boeing.

Uncertainty about the timing for Beijing to approve the MAX have contributed to the company’s travails in recent months.

China also has high hopes for developing its own aviation industry, with attention focused on Comac’s C919 narrow-body plane, a potential rival to Airbus and Boeing aircraft.

But analysts do not believe Beijing will be able to meet its targets solely with Chinese companies.

“It would be difficult for China to grow as much as it can without Boeing for at least the next 10 years,” Huey said, adding that the CAAC’s action “is unlocking access to a really critical market” for Boeing.

Boeing shares finished with a gain of 7.5% at $202.38, the biggest winner in the Dow.

 
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Ride-hailing giant Didi Global said Friday it will delist from the New York Stock Exchange and pursue a listing in Hong Kong, succumbing to pressure from Chinese regulators concerned about data security.

It ran afoul of Chinese authorities by pushing ahead with its $4.4 billion U.S. IPO in July despite being asked to put it on hold while a review of its data practices was conducted.

The powerful Cyberspace Administration of China (CAC) then quickly ordered app stores to remove 25 mobile apps operated by Didi and also told the company to stop registering new users, citing national security and the public interest. Didi remains under investigation.

“Following careful research, the company will immediately start delisting on the New York stock exchange and start preparations for listing in Hong Kong,” Didi said on its Twitter-like Weibo account.

It later said in a separate English language statement that its board had approved the move.

“The company will organize a shareholders meeting to vote on the above matter at an appropriate time in the future, following necessary procedures,” it said.

Sources have told Reuters that Chinese regulators pressed Didi’s top executives to devise a plan to delist from the New York Stock Exchange due to concerns about data security.

“Didi’s plan to delist in the United States and the listing of Hong Kong stocks I believe will have an obvious impact on location decisions for large technology stocks’ future listings,” said Kenny Ng, securities strategist at Everbright Sun Hung Kai in Hong Kong.

“At the same time, this event makes the market believe that the current industry supervision of technology stocks in the mainland will continue, and the decline in the stock prices of technology stocks listed in Hong Kong today also reflects this factor.”

Sources have told Reuters that Didi is preparing to relaunch its apps in the country by the end of the year in anticipation that Beijing’s cybersecurity investigation into the company would be wrapped up by then.

The CAC did not immediately respond to a request for comment on Didi’s plans to delist from New York.

Didi made its New York debut on June 30 at $14 per American Depositary Share, which gave the company a valuation of $67.5 billion on a non-diluted basis. Those shares have since slid 44% until Thursday’s close, valuing it at $37.6 billion.

Shares in Didi investor SoftBank Group Corp fell more than 2% after the Didi announcement, also hurt by Southeast Asia ride hailing giant Grab’s slump in its Nasdaq debut.

SoftBank’s Vision Fund owns 21.5% of Didi, followed by Uber Technologies Inc with 12.8%, according to a filing in June by Didi. 

 
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Sudden travel bans imposed on South Africa in the past week over the omicron variant have dealt a blow to an already struggling economy, experts say. The jobless rate is creeping up to affect half the population and the lost tourism this month will have far-reaching impacts beyond the travel sector. Linda Givetash reports from Johannesburg.
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First-time claims for U.S. unemployment compensation remained at a low level last week as employers retained their workers and searched for more as the United States continues its economic recovery from the coronavirus pandemic.

The Labor Department said Thursday that 222,000 jobless workers made first-time claims for unemployment compensation, up 28,000 from the revised figure of 194,000 the week before, which was a 52-year low.

Even with the increase in claims last week, the figures from both of the last two weeks were well below the 256,000 total in mid-March 2020 when the pandemic first swept into the country and employers started laying off workers by the hundreds of thousands.  

The declining number of claims for unemployment benefits shows that many employers are hanging on to their workers even as millions have quit jobs to move to other companies offering higher pay and more benefits.  

Many employers are looking for more workers, even as about 7.4 million workers remain unemployed in the United States.

There are 10.4 million available jobs in the country, but the skills of available workers often do not match what employers want, or the job openings are not where the unemployed live. In addition, many of the available jobs are low-wage service positions that the jobless are shunning.  

U.S. employers added 531,000 jobs in October, the biggest monthly gain in three months and the unemployment rate dropped to 4.6%. But the U.S. economy is still short more than four million jobs since February 2020. The November jobs figure is set for release on Friday.

The U.S. economic advance is occurring even as President Joe Biden and Washington policy makers, along with consumers, voice concerns about the biggest increase in consumer prices in three decades and supply chain issues that have curtailed delivery of some products to retail store shelves.
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Myanmar’s economy is crumbling and experts predict more illegal trade and zero growth in 2022. 

The Southeast Asian country’s economy has been in rapid decline following the chaos of February’s military coup. Thousands of citizens have gone on strike, refusing to work under military rule, including healthcare workers, lawyers, teachers and engineers. 

Days after the coup took place nine months ago, the Civil Disobedience Movement (CDM), was formed. It is a large-scale labor strike campaign with a mission to resist the junta by denting the military-controlled economy. 

Shortly after the movement began, Myanmar’s bankers joined and refused to go to work. That prompted cash flow problems for the population and businesses, but also the military.

As the year has gone on, any military-owned or affiliated businesses faced large boycotts. Global brands have halted orders with Myanmar’s manufacturing industry, while Chinese-made products have been boycotted amid allegations that China supports Myanmar’s military junta. Beijing had blocked a U.N. Security Council statement condemning the coup. 

Fearing for their lives, thousands of workers fled their rural homes because of the increased fighting between national soldiers and opposition groups. Factories and businesses have also closed, leading to increasing unemployment and lost income. 

Gwen Robinson, an editor at Nikkei Asia, sponsored an event hosted by the Foreign Correspondent’s Club of Thailand (FCCT) in Bangkok in November, that outlined some of the economic woes in Myanmar.

“It’s clear we are seeing both boom and bust in Myanmar right now. There is a booming illicit economy… and there are growing perceptions of a collapsing licit or domestic open economy,” she said. 

With a continuing crackdown, Myanmar’s military enterprises have faced heavy trade sanctions by the U.S., Britain and the European Union. It’s put pressure on military leadership. 

“General Min Aung Hlaing [has spoken of] increased self-reliance, urged people use less fuel, increase use of public transport and walking, consume less edible oil, reduce imports and consume less rice. There is a creeping paranoia by the junta that the economy is crumbling around them, and seem powerless to stop the rot,” Robinson said. 

Myanmar’s agricultural, marine, mineral and manufactured exports have slowed, while raw materials and investment imports have also been in decline since 2020. Myanmar business registrations also have fallen by 44% this year, while there have been rapid changes in the valuation of Myanmar’s currency, the kyat, against the U.S. dollar in recent months, Robinson’s researched outlined. 

A report by the International Labor Organization (ILO) states there were 1.2 million job losses in the second quarter of 2021. All sectors of Myanmar’s economy were affected, with the tourist, hospitality, construction and garment sectors hit the worst. 

But the sliding economy has been apparent since the beginning of last year’s COVID-19 pandemic, Robinson said. 

“The economy was beginning to collapse well before the coup due to these very harsh lockdowns that closed businesses and choked the economy. The resurgence of COVID-19 has hit the economy,” she added. 

Myanmar has a population of nearly 55 million. About 25% of the population is fully vaccinated against COVID-19. Since the pandemic began, the country has recorded more than 522,000 cases and 19,000 deaths, according to Johns Hopkins University data. 

In July the World Bank had forecasted Myanmar’s legitimate economy would decline by 18% in 2021. Fitch Solutions, a U.S. credit rating agency, has revised its growth forecast for Myanmar for 2022 by predicting there will be a -4.4% contraction.

Political analyst Aung Thu Nyein believes any positive recovery of Myanmar’s economy is unlikely. 

“Other neighboring countries show a sign of recovery from the COVID-19 crisis. I don’t see a sign of recovery in the coming year for the Myanmar economy. It is very likely to go back to the status of “the last frontier in Asia” as some people claimed Myanmar in its initial opening in 2012. There seems no potential credible investment in 2022,” he told VOA. 

The analyst admitted that a little growth in trade could be possible because borders are expected to open with China and Russia continuing to supply equipment to the military. 

But Jeremy Douglas, the Regional Representative for the United Nations Office on Drugs and Crime, said as the legitimate economy declines, the illicit drug trade among crime groups is growing. 

Also speaking at the FCCT event on November 17, Douglas said the illicit economy, including heroin and methamphetamines, is “diverse.” 

“The synthetic drug economy has proven its ability to expand very fast, so it really ramped up. This is against the background of the conditions on the ground, and these conditions are perfect for these folks to do this business, to grow that illicit economy as the licit declines,” he said. 

Douglas said Myanmar’s Shan state is a production point for illegal drugs being distributed across the Asia Pacific region and added as the market economy declines in Myanmar, those out of work are being lured to work within the drug trade. 

“It is a huge economy already, pre the coup, even after COVID-19, it continued to expand. As the transport connections start expanding, you’re going to see more connection to those markets and the push from supply go further and further from the point of production, which is a concern,” he added. 

Myanmar, formerly known as Burma, gained independence in 1948 from Britain but most of its modern history has been governed under military rule. 

In the November 2020 general elections, Aung San Suu Kyi’s democratic government won convincingly, but the military contested the results, claiming widespread electoral fraud without evidence. On February 1, the military removed the government, while arresting Suu Kyi and President Win Myint, who both face mounting criminal charges. 

Anti-coup demonstrations began shortly after, with thousands taking to the streets. But the military has violently cracked down on dissidents, with at least 1,300 killed, according to the Assistance Association for Political Prisoners (AAPP).
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Supply-chain snarls continue to delay imports from Asia. And those delays are mirrored for exporters shipping goods to Asia. Titi Tran reports from Southern California.
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Global factory activity accelerated in November although crippling supply bottlenecks remained, putting a cap on output and driving up the cost of raw materials, according to surveys published on Wednesday.

Towards the end of the month, the newly-detected Omicron coronavirus variant emerged as a fresh worry for policymakers, who are already trying to pilot recovering economies and tamp-down inflation.

The November surveys likely did not reflect the spread of the variant, which could add further pressure on pandemic-disrupted supply chains, with many countries imposing fresh border controls to seal themselves off.

“The Omicron variant…could be a game-changer: shortages of inputs and labor would worsen for manufacturers if Britain and other countries went into another lockdown,” said Samuel Tombs at Pantheon Macroeconomics.

IHS Markit’s final manufacturing Purchasing Managers’ Index (PMI) for the euro zone nevertheless nudged up to 58.4 in November from October’s 58.3, shy of an initial 58.6 “flash” estimate but still comfortably above the 50 mark separating growth from contraction.

Supply chain issues have made it a sellers’ market for raw materials and the input prices index was only just below October’s record high and factories in the region passed on the rising costs to customers at the fastest rate in the survey’s history.

That suggests overall inflation in the bloc, which preliminary official data showed on Tuesday was a record high 4.9% last month, will continue to overshoot the European Central Bank’s 2.0% target putting pressure on the bank to act.

In Britain, outside the European Union and euro zone, more manufacturers than at any point in the last 30 years reported rising costs last month, underlining pressure on the Bank of England to raise interest rates.

The BoE will be the first major central bank to raise interest rates, possibly as soon as this month, a November Reuters poll predicted.

U.S. central bankers will discuss in December whether to end their bond purchases a few months earlier than had been anticipated, Federal Reserve Chair Jerome Powell said on Tuesday, leading to a sharp move higher in shorter-dated Treasury yields. 

China breaks

China’s factory activity fell back into contraction in November, the private Caixin/Markit Manufacturing PMI showed, as soft demand and elevated prices hurt manufacturers.

The findings from the private-sector survey, which focuses more on small firms in coastal regions, stood in contrast with those in China’s official PMI on Tuesday that showed manufacturing activity unexpectedly rose in November, albeit at a very modest pace.

“Relaxing constraints on the supply side, especially the easing of the power crunch, quickened the pace of production recovery,” said Wang Zhe, senior economist at Caixin Insight Group, in a statement accompanying the data release.

“But demand was relatively weak, suppressed by the COVID-19 epidemic and rising product prices.”

Beyond China, however, factory activity seemed to be on the mend with PMIs showing expansion in countries ranging from Japan, South Korea, India, Vietnam and the Philippines.

Japan’s PMI rose to a near four-year high while in South Korea’s the PMI edged up.

India’s manufacturing activity grew at the fastest pace in 10 months in November, buoyed by a strong pick-up in demand. Taiwan’s manufacturing activity continued to expand and it was a similar picture in Indonesia.
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