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Mali has failed to meet debt payments of some $40 million in treasury bonds, blaming sanctions imposed on the country’s military junta by West African bloc ECOWAS.

The Malian Economy and Finance Ministry released a statement on Tuesday saying that recently imposed sanctions have prevented them from paying debt on treasury bonds totaling almost $5 million.

UMOA-Titres, the agency that manages public securities in the West African CFA franc zone, issued three separate statements to investors this week stating that Mali has missed several payments totaling $40 million.

Both the Economic Community of West African States and the West African Economic and Monetary Union imposed sanctions on Mali last month after the country’s military junta, which seized power last year, postponed elections.

The sanctions froze Mali’s assets held by the Senegal-based Central Bank of West African States (BCEAO).

Modibo Mao Makalou is an economist and former economic advisor to the Malian presidency. Speaking from Bamako via messaging app, he said that because of the sanctions, not only will the Malian government be unable to pay the state’s debt, but it will also be unable to pay for internal operations.

“If the state does not manage to refinance itself, not only with regard to the expenses for staff, but also energy, communication expenses, expenses for missions, including military operations — this will prevent the state from functioning on a daily basis,” he said.

The Central Bank of West African States serves the eight countries in West Africa that share a common currency, the West African CFA franc.

Kobi Annan, a risk consultant based in Accra with Songhai Advisory, an economic and risk consultancy firm focused on sub-Saharan Africa, says that Mali has some reserves that will carry the country through the next few months.

He says making Mali default on the debt is exactly how the West African sanctions are designed to work, to put pressure on the transitional authorities.

“This would be fully expected; this is part of why it’s done that way, to make things more difficult for Mali,” said Annan. “If you default on debt or if you don’t pay back debt, then you are deemed a higher risk, meaning that borrowing when you are able to becomes more expensive.”

Annan and Makalou both assert that eventually, as the Malian government becomes less able to access or borrow money and as its reserves dwindle, social services are likely to be affected, bringing the effects of the financial sanctions against the state into the lives of ordinary Malians.

Mali’s transitional military government has widespread support from the Malian population. Since being sanctioned, the government has not proposed a new election timeline, but has expressed a willingness to continue dialogue with ECOWAS.

The ministry’s statement added that debts would be paid as soon as restrictions are lifted.
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The most recent COVID-19 cases in China have put even more stress on an already strained supply chain, causing delays in the shipping of everyday items to the United States. VOA’s Elizabeth Lee shows what one business is doing to alleviate the problem.
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New claims for jobless benefits fell in the United States last week, the Labor Department reported Thursday, as many employers hung on to the workers they have and searched for more.

The agency said 238,000 unemployed workers filed for compensation, down 23,000 from the revised figure of the week before. The new total was in line with the claim figures from recent weeks as the U.S. economy, the world’s largest, continues to recover from the havoc inflicted on it by the advance of the coronavirus pandemic that swept into the country nearly two years ago.

Analysts now are awaiting the government’s release Friday of January’s employment picture in the U.S., the number of new jobs created last month and the unemployment rate, which was 3.9% in December.

The U.S. economy added a modest 199,000 new jobs in December, and analysts say January’s figure may not be much different, perhaps even smaller, as the number of new omicron variant coronavirus cases surged early in January and then waned, after the employment data was collected at mid-month.

Many employers are looking for more workers, despite about 6.9 million workers remaining unemployed in the U.S.  

At the end of November, there were 10.4 million job openings in the U.S., 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. 

But overall, the U.S. economy is surging, advancing by 5.7% in 2021, the fastest full-year gain since 1984, the Commerce Department reported last week. 

The sharp growth in the world’s biggest economy showed its resiliency, even as the U.S. struggled to cope last year with two new coronavirus variants that hobbled some industries, caused supply chain issues for consumer goods that at times left store shelves empty, and led to a 7% year-over-year surge in consumer prices that was the highest in four decades.

But for the year, a record 6.4 million jobs were created, and most of the jobs lost at the outset of the pandemic in early 2020 have been recovered.

Some economic analysts say that even if the January jobs number is weak, it may be a temporary setback because the number of new coronavirus cases has been dropping sharply in the U.S. to under 400,000 new cases a day, about half of what it was just weeks ago.

The country’s robust economy pushed Federal Reserve policymakers last week to announce they could boost their benchmark interest rate as early as March after keeping it near 0% since the coronavirus first swept into the United States in March 2020. 

The Fed could increase the rate several more times this year, which could have a broad effect on borrowing costs for consumers and businesses.
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The Treasury Department this week reported that the total national debt of the United States surpassed $30 trillion for the first time in history, an amount equal to nearly 130% of America’s yearly economic output, known as gross domestic product. The eye-popping figure makes the U.S. one of the most heavily indebted nations in the world. 

The federal debt has been high and rising for decades, but the federal government’s response to the coronavirus pandemic, which involved massive infusions of cash into the U.S. economy, greatly accelerated its growth.  

At the end of 2019, prior to the pandemic, the national debt stood at $22.7 trillion. One year later, it had risen by an additional $5 trillion, to $27.7 trillion. Since then, the nation has added more than $2 trillion in further debt. 

A grim reminder 

While the $30 trillion figure, by itself, has no significant meaning, it may serve to focus attention on what some see as a major concern for the future health of the country. 

“Hitting the $30 trillion mark is a reminder of just how high our debt is and just how much we’ve been borrowing,” said Marc Goldwein, senior vice president and senior policy director for the Committee for a Responsible Federal Budget.  

“Debt held by the public, which is the measure we prefer to use, is about as large as the economy,” Goldwein told VOA. “In a decade, it’ll be larger than any time since World War II. Meanwhile, we have the highest inflation rate we’ve had in 40 years, and there doesn’t seem to be any sign that the borrowing is going to let up.” 

Different debtors 

The $30 trillion in outstanding debt is owed to a wide variety of creditors, including the federal government itself. 

According to the Treasury Department, as of January 31, $6.5 trillion of the national debt was classified as “intragovernmental holdings.” This includes Treasury securities held by various agencies of the federal government, most prominently the Social Security Administration, which maintains a trust fund to provide income to senior citizens. 

The far larger portion of the debt is classified as debt held by the public, which amounts to $23.5 trillion. The term “public” can be somewhat misleading because the category includes not just the debt instruments held by individual investors but also the debts held by the Federal Reserve, large investment funds and foreign governments. 

According to the Treasury Department, foreign governments hold about $7.7 trillion in U.S. debt, though no country holds more than 5% of the total. As of the end of November, the most recent data available, Japan was the largest foreign holder of U.S. debt, with $1.3 trillion. China was the second-largest holder of U.S. debt, with $1.1 trillion, while the United Kingdom was in distant third place, with $622 billion. 

The cost of debt 

The cost of servicing the country’s outstanding debt has become a major part of the federal budget as the outstanding debt has grown. In 2021, the government made $562 billion in interest payments on outstanding debt. That is more than the annual budget of every individual federal agency except for the Treasury, the Department of Health and Human Services (which manages the Medicare and Medicaid government health insurance programs), and the Department of Defense. 

Surprisingly, during the early part of the pandemic, the federal government’s interest payments fell even as the debt increased, because of a broad decline in interest rates. 

However, with the Federal Reserve poised to begin raising interest rates in an attempt to ward off rising inflation, the rate the Treasury has to pay on newly issued debt will likely rise, meaning that the overall cost of servicing the federal debt will likely go up in the relatively near future. 

Comparison with other countries 

The United States’ ratio of debt to GDP, the measure most commonly used to gauge a country’s level of indebtedness, places it among the most indebted countries in the world. 

According to data gathered by the World Bank in October, the country with the world’s highest debt-to-GDP ratio is Japan, which carries debt equivalent to 257% of its economic output. Other developed economies with very high debt-to-GDP ratios include Greece, at 207%, and Italy, at 155%. 

With a ratio of 133%, the U.S. is the 12th most indebted country overall, and the fourth most indebted among the developed economies that make up the Organization for Economic Co-operation and Development. The OECD average is an 80% debt-to-GDP ratio. 

Both parties added to debt 

The national debt is the cumulative total of annual federal deficits. The U.S. has seen federal surpluses in just four of the past 50 years, from 1998 to 2001, encompassing the last three years of the administration of Bill Clinton, a Democrat, and the first year of the administration of George W. Bush, a Republican.  

In recent decades, both Democrats and Republicans have contributed to the rising levels of federal borrowing, with the debt increasing on a regular basis, regardless of which party controlled Congress and the White House. 

It’s a fact that causes some members of Congress to express frustration with their colleagues over a seeming lack of concern about the problem. 

“$30 trillion in debt is an obscene number, but what’s even more depressing is the fact that most politicians in both parties don’t really care,” Senator Ben Sasse, a Nebraska Republican, said in a statement. “Someone is going to have to pay that money when these politicians are long gone, and — spoiler alert — it won’t be paid by them but instead by our kids.” 

 
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India’s government has pledged to spend billions of dollars on public infrastructure to reboot an economy that is bouncing back from the massive contraction it suffered during the novel coronavirus pandemic. But concerns remain about an uneven pace of growth that has seen big businesses flourish but its vast unorganized sector struggle.

Asia’s third largest economy is projected to grow at 8% to 8.5% this year, according to government figures.

The strong economic recovery began last year despite a deadly second wave of COVID with growth estimated at 9.2% in the financial year that will end in March. 

“The economy has shown strong resilience to come out of the effects of the pandemic with high growth,” Finance Minister Nirmala Sitharaman said as she presented the country’s annual budget Tuesday. “However, we need to sustain that level to make up for the setback of 2020-21.”

The budget increases spending to $533 billion in the coming year from $477 billion. 

She announced that the government would spend $2.7 billion to build highways and $6.4 billion on housing for the poor. It will also expand rail networks, ports and airports, manufacture energy efficient trains and extend credit guarantees to small businesses.

Sitharaman said climate action is a priority and promised to focus on electric mobility and solar power in a bid to reduce the country’s carbon emissions.

“I am conscious of the need to nurture growth through public investment to become stronger and more sustainable,” Sitharaman said.

Economists have welcomed the government’s decision to step up spending. “The decision to increase public investment to 2.9% of gross domestic product, is rock solid and good news and should attract private investment into infrastructure,” says Santosh Mehrotra, a human development economist and author of the book “Reviving Jobs: An Agenda for Growth.”  

According to the finance minister, the new investments would help create six million jobs over the next five years. 

Mehrotra however points out that this fails to address the scale of the challenge India faces. “The unemployment crisis we face is huge. Five to six million people join the labor force every year. That is on top of the unemployed we already have. That number was 30 million in the year 2019 and it has only grown post the pandemic by another 10 million,” says Mehrotra. “And we also have millions who want to come out of agriculture into non-farming jobs.”  

The unemployment challenge was underlined last week by violent protests by job seekers that erupted in Bihar and Uttar Pradesh. 

Several economists point out that while India’s economy has rebounded, growth has not percolated down as its vast informal sector, which provides most livelihoods, continues to reel under the impact of long shutdowns imposed when infections spiraled during the last two years. Tens of thousands of small enterprises have shut down. That has widened income inequalities with an estimated 80% of households losing incomes during the pandemic.

But there is optimism as a third wave of the pandemic driven by the omicron variant begins to recede. India’s vaccination program has made significant progress since July last year — 75% of adults are fully inoculated. That is creating confidence in opening most sectors of the economy.

“The economy is in a good place to grow strongly into the next year or two,” the finance ministry’s principal economic advisor, Sanjeev Sanyal, said while presenting the country’s economic survey on Monday.

India’s economic growth two years into the pandemic is seen as the fastest among major economies in the world. The revival comes after its economy shrank in 2020 by 6.6% — the sharpest dip in 40 years that came after a long and stringent shutdown.

India also said the country’s central bank will introduce a “digital rupee” this year using blockchain technology, becoming one of the first major countries to do so and said it will levy a 30% tax on income from virtual digital assets.
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South Africa’s luxury housing dealers say the market is booming despite the economic damage from the coronavirus pandemic. Real estate agents say the need to work from home and have better security are some of the drivers, while affordable housing for the poor remains a challenge. Linda Givetash reports from Johannesburg.
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At the W Kuala Lumpur hotel, high tea sets are prepared for delivery to customers celebrating the upcoming Chinese New Year. Inside are meats such as rolled smoked duck as well as tiger prawn sliders and fresh baked treats including red date cheesecake and chocolate tarts. A five-star hotel known for upscale dining in now also relies on home delivery.

“Delivery was something new and we hadn’t considered it really prior to the pandemic,” said Christian Metzner, general manager of the W Kuala Lumpur, adding that although home delivery currently makes up about 15% of his hotel’s food and beverage sales, it was 100% during periods when dining in was not allowed in Malaysia. “We started working with apps and different [delivery] companies,” he said.

Like hotels around the world, the pandemic led to a deep drop in business for the W Kuala Lumpur. Foreigners no longer flew in for vacations or business trips. So the hotel, part of the Marriott chain, pivoted and increased its marketing towards potential customers who live in Malaysia.

The hotel shut down twice during the past two years, for about three months each time. Its last closure ended in August 2021. Management says while business is still down 25% from pre-pandemic levels, during the past several months the hotel has been operating well above the break-even point, drawing customers to guest rooms and the pool for staycations as well as offering food on popular local delivery platforms. 

“Just to stay in the game we had to actually connect and open our channels, open our minds to other channels to sell our products and sell our experience,” Metzner said, adding that the hotel chain’s health and safety protocols — continuously disinfecting public areas, mobile phone check-ins and other measures — also help.

Prior to the pandemic, tourism accounted for more than 15% of Malaysia’s GDP. Because so much of that business disappeared, Yap Lip Seng, chief executive officer of the Malaysian Association of Hotels, the W Kuala Lumpur’s successful shift to the domestic market a rare achievement.

“You need to set yourself apart from the pack,” Yap said, adding that the majority of the country’s hotels are still not able to turn a profit. “First, your competition is with the stand-alone restaurants outside and second, you have to compete with the same grade of hotels within that area.”

Northern Malaysia boasts the popular vacation destination of Langkawi, an archipelago known for its beaches and sea activities. For 21 years, Oli Khalid and his wife Tanja Bindemann have been running a cafe here called the Red Tomato, which has long been a gathering spot for foreign tourists who come for the fresh baked bread, big salads and warm hospitality.

“They come as strangers, travelers, and they leave as friends. That’s our motto,” said Khalid.

But Khalid and Bindemann haven’t been able to make as many new friends over the past two years. Khalid said there were times when business was down 90%.Although there has been an uptick in Malaysian customers recently, business is still half of what it was compared to pre-pandemic levels.

In November, the Malaysian government started a tourist bubble to try to draw vaccinated foreigners to Langkawi. But Khalid and other managers of local businesses said it hasn’t yet yielded a significant increase in customers.

Khalid said he has seen other local businesses close down and says if the situation doesn’t improve, his cafe might go bust in another six months. “We do have sleepless nights thinking, ‘What are we supposed to do?’” Khalid says. “What’s going to happen and what if the situation doesn’t improve, what do we do?”

The Malaysian government is considering additional steps to allow more foreign tourists inside the country. That’s an idea that small mom-and-pop shops such as Khalid’s — as well as major international hotel chains like Metzner’s — say would boost their bottom lines.
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Iran’s Supreme Leader Ali Khamenei said Sunday that the country’s poor economic situation was not only due to international sanctions but also to government mismanagement.

“Wrong decisions and shortcomings” were part of the reason for the Islamic republic’s “unsatisfactory” economic data, he said about the decade from March 2011 to last year.

Indicators such as “GDP growth, capital formation, inflation, housing and liquidity growth were not satisfactory,” Khamenei said.

“The main cause of these problems is not only sanctions, but also wrong decisions and shortcomings,” he told a meeting with economic officials.

“If the authorities had cooperated more with the producers in these 10 years, the damage would have been less, and the successes would have been greater,” he added in an implicit attack on former president Hassan Rouhani’s governments from 2013 to 2021.

Iran, which last year elected President Ebrahim Raisi, has been hit by severe economic sanctions imposed in 2018 by the United States, and has seen its inflation rate surge to close to 60 percent.

Khamenei criticized the high prices and low quality of some home-made products, especially cars.

He also charged that “despite the government’s support,” the price of some domestically-produced home appliances had doubled.

Iran has witnessed a number of protest rallies in the past few weeks by civil servants, including from the judiciary, against tough economic conditions.

Regarding companies operating despite the sanctions, Khamenei said that “we have successful examples and businesses that did not wait for the lifting of sanctions.”

Iran has been negotiating in Vienna — directly with Britain, China, France, Germany and Russia, and indirectly with the United States — to revive its tattered 2015 nuclear deal.

The landmark agreement offered Tehran sanctions relief in exchange for curbs on its nuclear program.

But the U.S. unilaterally withdrew from it in 2018 under then-president Donald Trump and reimposed biting economic sanctions on Iran.
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Violent protests by job seekers that gripped two Indian states this week have turned the spotlight on India’s unemployment crisis, especially among young and educated people, economists say.

Angry mobs burned train cars and tires, and blocked rail traffic in Bihar and Uttar Pradesh, two of India’s most populous states, over alleged flaws in the recruitment process for jobs in the government-run rail sector.

They complained of lack of transparency and said that the process unfairly gives an advantage to graduates applying for low-skilled jobs.

There were more than 12 million applicants for the 35,000 openings, reflecting the acute job scarcity. Even before the pandemic battered the economy, unemployment was running at a four-decade high, reflecting the inability of the job market to cater to the more than 10 million new applicants every year.

The situation has worsened in the last two years even though the economy is recovering. It is most stark in states such as Bihar, where the unemployment rate is double the national average. One of India’s least developed states, it has very few avenues for private sector employment, which is why government jobs that are better paid and offer security are highly prized.

Among the applicants for a rail sector job is Guddu Kumar Singh, a 32-year-old resident of Bihar, who has spent nearly 15 years applying unsuccessfully for a variety of government jobs. After failing to make the cut for a clerk in the Indian army after graduating from high school, he focused on improving his educational qualifications and earned a degree in economics — he and his brother were the first generation in his farming family to get college degrees. Like millions of others, the family saw education as the path to a brighter future.

“I was a sincere student – I spent 13, 14 hours a day studying to get my degree. I was so positive. I never thought I would not get a job,” Singh said. “I am totally dejected. My family also asks me, what did I achieve by studying?”

According to the Center for Monitoring Indian Economy, an independent think tank, India’s unemployment rate was nearly 8% in December. It says, however, that this number does not reflect the true scale of unemployment in India because millions of educated people have stopped looking for jobs.

They are people like Singh — if he does not get a railway job he could simply drop out of the job market, returning to what he has been doing while he searched for a job – tutoring school students.

“Unemployment is higher among younger and more educated people because appropriate jobs are not available,” economist Arun Kumar, a former professor with New Delhi’s Jawaharlal Nehru University, said.

“The organized sector barely generates about 300,000 jobs a year, so where do the other aspirants go? There is a crisis of unemployment.”

The huge gap between supply and demand has resulted in qualified people taking jobs of much lower skills.

Earlier this month, graduates, post-graduates, engineers, and civil judge aspirants were among the more than 10,000 young people who turned up for interviews for 15 government jobs such as drivers and watchmen in the central state of Madhya Pradesh, according to a report by local broadcaster NDTV.

Economists say that part of the problem is that, unlike several other Asian countries, India never created a large-scale manufacturing sector — its growth is being powered by its booming services sector, which creates fewer jobs.

The government says job creation is a priority – in recent years, it has been trying to pitch India as an attractive investment destination to woo global manufacturers. Those efforts have intensified since the pandemic as India eyes the opportunity of luring companies that are looking to move some manufacturing out of China.

“India is committed to becoming a trustworthy partner for the world’s global supply chains,” Indian Prime Minister Narendra Modi told a virtual meeting of the World Economic Forum earlier this month. “We are making way for free trade agreements with many countries. India’s capacity to adopt to innovative technologies and its spirit of entrepreneurship can give new energy to all our global partners. This is why now is the best time to invest in India.”

Economists like Kumar, though, point out that even if India is able to attract companies to set up factories, modern manufacturing generates far fewer jobs than it did in the past because of automation.

“India must invest more resources in more employment-intensive sectors like health and education that provide jobs for more qualified people like teachers, nurses, technicians,” he said. “The frustration among the young and educated is boiling over.”

Indian commentators have called the recent protests a wake-up call in a country where half the population of 1.3 billion is under 25. The Indian Express newspaper said they were a “sobering message.”

The government has suspended the examination for rail jobs and said a committee has been formed to investigate candidates’ concerns.

For those like Singh, who sees it as his last chance to secure employment, the uncertainty is unbearable.

“I feel really anguished when I think of the years I spent getting a college degree. If I had spent the same time doing something else, I would have had better earnings.” 

 
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A key inflation indicator was up 5.8% over last year, the Commerce Department said Friday. It was the indicator’s highest jump since 1982.

The rise came in the government’s personal consumption expenditures index (PCE), which the Federal Reserve uses to guide interest rate moves. The PCE tracks actual consumer spending.

Another indicator, the consumer price index (CPI), jumped 7% last year, the government reported earlier this month. The CPI tracks the price of a basket of various goods.

The increased prices of goods could be behind a 0.6% drop in consumer spending in December, the department said. Consumer spending accounts for two-thirds of U.S. economic activity.

Inflation has also largely erased wage gains seen in many U.S households.

The pandemic, labor shortages and supply chain problems continue to drag on the economy.

The growing inflation adds pressure on the Federal Reserve to hike interest rates, which comes with the danger of slowing economic growth.

“No one wants to go back to the ’80s, but the economy is. Can stagflation from an overly aggressive Fed be next?” Christopher Rupkey, chief economist at FWDBONDS in New York, said in an interview with Reuters. “The Fed let its guard down and now they risk it all by saying they might have to move faster and higher on interest rates.”

The Fed could move as early as March to raise interest rates.​

Some information for this report came from Reuters and The Associated Press.
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With President Joe Biden’s broader domestic agenda stymied in the Senate, Democratic leaders in Congress have begun looking for legislative victories elsewhere, with a new focus on improving the U.S. ability to compete with China.

Democrats in the House of Representatives are attempting to come to agreement on legislation that would provide large financial subsidies to the semiconductor industry as well as generous research and development grants to support supply chain resilience, buoy domestic manufacturing operations and underwrite new scientific research.

The effort in the House follows a push in the Senate last year, which resulted in bipartisan passage of the United States Innovation and Competition Act of 2021. That bill proposed $52 billion in assistance to the semiconductor industry as well as nearly $200 billion more on research and development projects meant to bolster U.S. competitiveness.

The House is likely to pass its own version of the legislation, meaning the two chambers would have to come to an agreement on final language before a bill could go to the White House to be signed into law. It remains unclear whether an eventual House bill would garner any Republican support in that chamber, or whether compromise language would continue to attract the Republican support that helped the Senate’s original bill come to the floor for a vote.

But in a statement this week, the president made it clear that he would like to see the legislation on his desk.

Biden praised the “transformational investments” that the legislation would make. With the proposed legislation, he said, “We have an opportunity to show China and the rest of the world that the 21st century will be the American century – forged by the ingenuity and hard work of our innovators, workers, and businesses.”

Countering Chinese subsidies

In Congress, even among conservative lawmakers who generally shy away from government intervention in the economy, there is recognition of a need to balance the scales for U.S. companies that frequently find themselves in competition with Chinese firms that receive subsidies and other preferences from the government in Beijing.

When the Senate passed its version of the bill in June, Florida Republican Sen. Marco Rubio said, “This type of targeted investment in a critical industry was unthinkable just a couple years ago, but the need for smart industrial policy is now widely accepted.”

That comes as a surprise to many observers of U.S. policymaking.

“There is somewhat of an ambivalence, or confusion, in D.C. where, on the one hand, people want to say that China’s industrial policies are both very unfair, and also very important in explaining China’s competitive success,” Gerard DiPippo, a senior fellow in the Economics Program at the Center for Strategic and International Studies, told VOA. “But then, they also seem reluctant to actually engage in those policies because they think those policies are actually very distortionary and ineffective. So, it sort of cuts both ways.”

Semiconductors in focus

Despite strong economic growth in the U.S. over the past year, a persistent shortage of semiconductors has caused some sectors of the economy – the automobile industry in particular – to lag behind. Supply chain disruptions caused by the coronavirus pandemic have been difficult to resolve, leading many members of Congress to propose funding to “re-shore” domestic production of semiconductors.

Both the Senate bill and the version being considered by the House of Representatives would funnel $52 billion in grants and subsidies to the industry.

However, China is not a major competitor of the United States when it comes to semiconductors. While China does make some semiconductors, the largest manufacturer in the world is TSMC, Taiwan Semiconductor Manufacturing Corp. in Taiwan.

‘Decoupling’ seen as troubling

Some American companies that do business with China are concerned about the long-term efforts of both countries to achieve economic independence from each other.

“China is upset with efforts to increase export restrictions on U.S. goods, block Chinese companies from accessing certain U.S. goods, and restrict some direct investments in China,” Doug Barry, a senior director with the U.S.-China Business Council, told VOA in an email exchange.

“They worry about incentives to relocate production of some critical goods back to the U.S. At the same time, China is working to reduce dependence on certain goods like advanced semiconductors, while slow-walking promised market access reform and opening,” Barry said.

“Our members worry that these efforts signal mutual economic decoupling that’s not in the long-term interest of either country,” he said. “Both governments need to engage in direct talks to better manage differences, adhere to WTO principles, and ensure that Phase One Agreement commitments are fully met.”

Government interference ‘misguided’

Ryan Young, a senior fellow with the Competitive Enterprise Institute, told VOA that efforts by Congress to mimic China by trying to manipulate the U.S. economy are “misguided” at best, and at worst destructive.

“This falls into what I think of as the ‘But they do it, too,’ argument,” Young said. While it is indisputable that the Chinese government creates all sorts of advantages for certain sectors within its economy, he said, it doesn’t follow that the answer is for the U.S. to do the same.

Despite government support, large Chinese tech firms are burdened with substantial debt, operational inefficiencies and political meddling, he said.

Further, Young noted that the semiconductor industry, which the legislative efforts target above all else, has already taken steps to bring some of its production into U.S. territory, with chip giant Intel expanding a $50 billion complex of chip manufacturing facilities in Arizona. 

 
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Gas stoves are contributing more to global warming than previously thought because of constant tiny methane leaks while they’re off, a new study found. 

The same study that tested emissions around stoves in homes raised new concerns about indoor air quality and health because of levels of nitrogen oxides measured. 

Even when they are not running, U.S. gas stoves are putting 2.6 million tons (2.4 million metric tons) of methane — in carbon dioxide equivalent units — into the air each year, a team of California researchers found in a study published in Thursday’s journal Environmental Science & Technology. That’s equivalent to the annual amount of greenhouse gases from 500,000 cars or what the United States puts into the air every three-and-a-half hours.

“They’re constantly bleeding a little bit of methane into the atmosphere all the time,” said the study’s co-author Rob Jackson, a Stanford University climate scientist. 

That methane is on top of the 6.8 million tons (6.2 million metric tons) of carbon dioxide that gas stoves emit into the air when they are in use and the gas is burned, the study said. Methane is a greenhouse gas that is dozens of times more potent than carbon dioxide but doesn’t stay in the atmosphere nearly as long and isn’t as plentiful in the air. 

The researchers examined 53 home kitchens in California — many in bed and breakfasts they rented. They sealed most of the rooms in plastic tarps and then measured emissions when the stoves were working and when they were not. And what was surprising was that three-quarters of the methane released happened while the stoves were off, Jackson said. Those are emissions releases that the government doesn’t account for, he said. 

“That’s a big deal because we’re trying to really reduce our carbon footprint and we claim that gas is cleaner than coal, which it is,” said study lead author Eric Lebel, a scientist at PSE Healthy Energy, an Oakland nonprofit. But he said much of the benefit disappears when leaks are taken into account. 

Many communities have bans on gas stove use in future new construction that will take effect in future years, including New York City and the Bay Area cities of San Francisco, Oakland, San Jose, and Berkeley, Jackson said. 

“People can already choose electric appliances if they want,” said Frank Maisano, a Washington policy and public relations expert who represents gas and appliance interests. “People just like gas appliances because they perform better, especially in colder climates.” 

“Natural gas appliances are generally more energy- and cost-effective than their electric counterparts,” Maisano said. 

Jackson estimated that when all natural gas use and extraction is taken into account, about 100 million tons (91 million metric tons) of gas leaks into the atmosphere. And the couple million tons from gas stoves “is meaningful. That’s a substantial part and it’s a part that we haven’t included accurately in the past.” 

The leakage finding is “a very important takeaway” and fits with other work that found there are often big leaks that account for much of the emissions, said Zachary Merrin, a research engineer with the Illinois Applied Research Institute’s Indoor Climate Research & Training group. 

Merrin, who wasn’t part of the study, said the emission of un-combusted methane is “clearly bad. From an emissions standpoint, cooking directly with gas is better than using a fossil fuel powered electric stove but worse than using a solar powered electric stove.” 

The methane leak isn’t dangerous to human health or as a possible explosive, Jackson said. But when conducting the tests, researchers found high levels of nitrogen oxides, greater than 100 parts per billion. Jackson said the U.S. Environmental Protection Agency doesn’t have indoor air quality standards for that gas, but the measurements they took exceed its outdoor air quality standards. While methane doesn’t include nitrogen, the nitrogen oxides are byproducts of the combustion in natural gas ovens, he said. 

Maisano said people should always use hood ranges and make sure they have proper ventilation. Jackson, who has a gas stove that he plans to replace, said he never used ventilation before this study, but that he now does so every time. 
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Kenya’s nomadic herders are among those suffering the most from recurring drought that kills the livestock they depend on. To make them less dependent on rain, aid programs are teaching Kenya’s herders how to farm fish and keep bees. Brenda Mulinya reports from Isiolo, Kenya.

Camera: Amos Wangwa Produced by: Amos Wangwa/Henry Hernandez
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The U.S. economy advanced by 5.7% in 2021, the fastest full-year gain since 1984, the Commerce Department reported Thursday.

The sharp growth in the world’s biggest economy showed its resiliency, even as the United States struggled to cope with two new coronavirus variants that hobbled some industries, caused supply chain issues for consumer goods that at times left store shelves empty and a 7% year-over-year surge in consumer prices that was the highest in four decades.

But for the year, a record 6.4 million jobs were created and most of the jobs lost at the outset of the pandemic in early 2020 have been recovered.

Analysts say the economic growth may have slowed in January because of the omicron variant, as thousands of workers called in sick, often canceling airline flights, curbing business activity and again limiting in-class instruction at some schools and universities.

But the government said the overall economic growth was still evident in the October-to-December quarter, with a 6.9% annualized advance, three times the 2.3% pace of the July-through-September period.

The country’s robust economy pushed Federal Reserve policymakers on Wednesday to announce they could boost their benchmark interest rate as early as March after keeping it near zero percent since the coronavirus first swept into the United States in March 2020. The Fed could increase the rate, which has a broad effect on consumer and business borrowing costs, several more times this year.

Meanwhile, the Labor Department reported Thursday that 260,000 unemployed U.S. workers made first-time claims for jobless compensation last week, down 30,000 from the revised figure of the week before.

The latest total is in line with the 256,000 figure recorded in mid-March 2020, just before the coronavirus wreaked havoc on U.S. economic activity and businesses started laying off workers by the hundreds of thousands.

In recent weeks, the U.S. has been recording 600,000 to 750,000 or more new cases of the coronavirus every day, largely because of the highly transmissible omicron variant.

For the most part, however, employers have been retaining their workers and searching for more as the United States continues its rapid economic recovery from the coronavirus pandemic. The country’s unemployment rate dropped in December to 3.9%, not far above the five-decade low of 3.5% recorded before the pandemic took hold.

Many employers are looking for more workers, despite about 6.9 million workers remaining unemployed in the United States.

At the end of November, there were 10.4 million job openings in the U.S., 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.
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Wednesday’s signal from the U.S. Federal Reserve on impending interest rate increases is expected to have ramifications beyond America’s shores.

The Fed’s Open Market Committee announced it was keeping, for now, the target range for a key interest rate at near zero but cautioned that with inflation well above 2% and a strong labor market, it expected “it will soon be appropriate to raise the target range for the federal funds rate.”

The federal funds rate is the interest rate commercial banks charge each other for overnight loans of their excess reserves.

“The committee is of a mind to raise rates at the March meeting,” Fed Chairman Jerome Powell told reporters Wednesday. “We have our eyes on risks around the world, but the economy should hold up.”

As the dollar serves as the primary international reserve currency, a U.S. interest rate hike would pressure central banks of other countries to also raise their rates for those who want to borrow money.

“The rest of the world has a lot of dollar debt, and even if their debt is in local currencies, their central banks will often have to raise interest rates to offset the U.S. rate increases to try to maintain some currency stability,” said Gerard DiPippo, senior fellow with the economics program at the Center for Strategic and International Studies.

“Raising interest rates is aimed at stifling consumer demand to address all of this money that’s sloshing around in our economy, and that’s going to affect consumers here, as well as producers of goods and other countries that rely on the U.S. market,” said Sarah Anderson, global economy project director at the Institute for Policy Studies.

Inflation ‘transmitted through trade’

Inflation in the United States is at a 40-year high amid surging consumer demand for goods, a strengthening domestic job market and pandemic-caused supply chain disruptions, including for critical semiconductors.

“The price of U.S. exports increased by more than the price of U.S. imports last year, so in a sense, the U.S. is exporting inflation because the cost of producing things in the U.S. has increased faster than the imports going into it from overseas. So, the inflation can be transmitted through trade,” DiPippo told VOA.

Some economists and policy analysts see the administration of U.S. President Joe Biden confusing structural and cyclical economic matters as it struggles to tame inflation.

“The cyclical phenomenon — inflation — over the next year or so, really only the Fed has the tools to deal with that,” DiPippo said. “Even if the Biden administration is able to increase subsidies to produce things in the United States or increase competition through regulation, those things take time. And we’re talking about inflation over the next year or two, not over the next five years. So, there’s a mismatch.”

The White House has repeatedly said that it is prioritizing lowering prices to help American households and that the best way to accomplish it is through increased competition.

“Competition results in lower prices for families. Competition results in fair wages for workers. And as you all know, competition encourages companies to innovate,” Biden said on Monday during a meeting of the White House Competition Council.

Prices have been surging in the United States and other countries since last year amid serious shortages of workers and the goods they produce. That has the International Monetary Fund predicting slower growth and faster inflation for the world’s biggest economies.

“People have shifted from spending money on services, like going out to restaurants and theaters, during the pandemic to buying more stuff,” Anderson told VOA. That has put more pressure on manufacturers, especially in countries such as China and Vietnam, which are having difficulty keeping pace with demand because so many workers have been sidelined by the pandemic.

“We can raise interest rates, but I don’t think the problem is going to go away until we end the pandemic,” Anderson added.

China’s “No-COVID policy may cause more lockdowns,” exacerbating the supply chain woes, Powell, the Fed chair, warned on Wednesday. “There’s plenty of risk out there.”
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The United States issued an advisory Wednesday warning of the increased risk of conducting business in Myanmar nearly a year after a military coup in the Southeast Asian country, which is also known as Burma. 

The advisory from the U.S. State Department warned it was especially risky for “individuals, businesses and financial institutions and other persons” to be associated with business activity in Myanmar “that could benefit the Burmese military regime.” 

The advisory cited the possibility of exposure to illegal financial and reputational risks by doing business there, and using supply chains controlled by the military. 

“The coup and subsequent abuses committed by the military have fundamentally changed the direction of the economic and business environment in Burma,” the advisory said. 

Former de factor leader Aung San Suu Kyi’s National League for Democracy (NLD) led Myanmar since its first open democratic election in 2015, but Myanmar’s military contested the November 2020 election results, claiming widespread electoral fraud, largely without evidence.

The military removed the NLD government in a coup on Feb. 1, 2021, detaining Suu Kyi and President Win Myint.

Since then, the military government has used deadly force in clampdowns on protests while escalating efforts to neutralize ethnic minority armies and newly formed militias allied with the NLD government. Wednesday’s advisory said the military “has killed more than 1,400 innocent people” since its takeover. 

The advisory said state-owned enterprises were of greatest concern, as well as the gems and precious metals, real estate, construction and defense industries, noting that they have been identified as providing economic resources for the junta. 

The advisory was issued after oil giants Chevron Corporation and TotalEnergies said last week the worsening humanitarian situation prompted them to withdraw from the country, where they were working together on a major gas project. 

 
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The World Trade Organization on Wednesday handed a fresh victory to China, permitting it to place duties on $645 million worth of U.S. imports per year, in a long-running anti-dumping dispute with Washington.

The United States is unable to appeal the decision.

“The deeply disappointing decision today by the WTO arbitrator reflects erroneous Appellate Body interpretations that damage the ability of WTO members to defend our workers and businesses from China’s trade-distorting subsidies,” said Adam Hodge, a spokesman for the U.S. Trade Representative Katherine Tai.

“Today’s decision reinforces the need to reform WTO rules and dispute settlement, which have been used to shield China’s non-market economic practices and undermine fair, market-oriented competition.”

The WTO green light does not mean China will automatically impose the tariffs, in whole or in part, on U.S. imports.

The figure was revealed in an 87-page decision by a WTO arbitrator on the level of countermeasures Beijing could request in its dispute with Washington regarding US countervailing duties (CVD) on certain Chinese products.

The dispute stretches all the way back to 2012, when the WTO set up a panel of experts to try to settle a complaint filed by China over what it said were unfair duties imposed by the United States.

Washington had justified the additional tariffs on products ranging from paper to tires and solar panels, arguing they were being dumped on the market to help Chinese companies grab business.

The WTO Dispute Settlement Body ruled in China’s favor, and the ruling was upheld by its appeals judges in 2014, paving the way for China to retaliate.

Beijing initially asked to be permitted to place tariffs on $2.4 billion in U.S. products each year, but then scaled back its demand to $788.75 million.  

The United States had argued that the appropriate level should not exceed $106 million per year.

The anti-dumping duties are permitted under international trade rules as long as they adhere to strict conditions, and disputes over their use are often brought before the WTO’s Dispute Settlement Body.  

Wednesday’s decision marks the second time the WTO has allowed China to retaliate for U.S. anti-dumping duties deemed to be in violation of international trade rules.

In November 2019, a WTO arbitrator permitted China to add duties on up to $3.6 billion worth of U.S. imports, in a separate case.

So far, China has not notified the WTO that it has implemented the approved retaliatory tariffs from that case.  

Washington has long complained about the WTO dispute settlement system, and especially its appeals court, claiming unfair treatment.

Biden’s predecessor Donald Trump brought the system to a grinding halt in December 2019 by blocking the appointment of new judges to the Appellate Body.
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