Бізнес

Washington — Jobs in the U.S. clean energy industry in 2023 grew at more than double the rate of the country’s overall jobs, and unionization in clean energy surpassed for the first time the rate in the wider energy industry, the Energy Department said on Wednesday.

Employment in clean energy businesses – including wind, solar, nuclear and battery storage — rose by 142,000 jobs, or 4.2% last year, up from a rise of 3.9% in 2022, the U.S. Energy and Employment Report said. The rate was above the overall U.S. job growth rate of 2% in 2023.

Unionization rates in clean energy hit 12.4%, more than the 11% in the overall energy business, it said. That was driven by growth in construction and utility industries and after legislation passed in 2022 including the bipartisan CHIPS Act and President Joe Biden’s Inflation Reduction Act, the department said.

Construction jobs in clean energy, driven by the legislation and private-sector investments, “is expected to continue for decades to build out the clean energy infrastructure that we need,” Betony Jones, the Energy Department’s head of energy jobs, told reporters in a call. While unionized members “might move from project to project, there is continuity of that work in order for workers to make a career in that industry,” she said.

Employment in the utility scale and rooftop solar industries grew 5.3% adding more than 18,000 jobs, it said. The solar installation industry in California, the country’s most populous state, says it has lost more than 17,000 jobs due to high interest rates and the state’s lowering of net meter rates that allow customers to be credited for excess power their rooftop panels generate.

New jobs in fossil fuels were mixed. The natural gas workforce grew by more than 77,000 or 13.3%, while jobs in petroleum fell more than 44,000 or 6%. Coal jobs fell nearly 8,500 or 5.3% as power generation continued to switch from coal to gas, wind and solar. White House climate adviser Ali Zaidi told reporters that the report showed the administration’s commitment to pursue both energy and climate security.

Energy remained a mostly male workforce with an average of 73% in 2023 compared with the national workforce average that was 53% male, the same numbers as in the previous year. Women accounted for about half the energy jobs added in 2022, but only 17% of the jobs added in 2023, the report said.

 
…

TORONTO — A workers’ union Friday threatened a strike at one of Canada’s two major freight railroads, only hours after the company’s trains restarted following a potentially devastating stoppage. A government-ordered arbitration hearing wrapped up without a decision, and Canadian National trains were expected to keep moving at least through Monday morning.

CN and Canadian Pacific Kansas City Ltd. locked out their workers Thursday when negotiations over a new labor contract reached a deadline without an agreement. That resulted in a near total shutdown of freight rail in the country for more than a day, until Canadian National resumed its service Friday morning. Trains operated by CPKC remain parked, and its workers, who had already been on strike since Thursday, stayed on the picket line Friday.

The government forced the companies and the union, Teamsters Canada Rail Conference, into arbitration overseen by the Canada Industrial Relations Board — an order the union is challenging. Friday’s nine-hour hearing ended with no order from the board.

The union filed a 72-hour strike notice against CN on Friday morning shortly after it announced that it planned to challenge the arbitration order, union spokesperson Marc-Andre Gauthier said.

If the board orders the union back to work, “the TCRC will lawfully abide by the decision, but will undertake steps to challenge to the fullest extent,” the Teamsters said in a statement. “Unfortunately, this will not provide immediate relief, but the Union is prepared to appeal to federal court if necessary.”

Canadian National, which has about 6,500 workers involved in the dispute, said the impact of the strike notice will depend on the timing of the Canada Industrial Relations Board’s decision. “It is in the national interest of Canada that the CIRB rule quickly, before even more harm is caused,” the railroad said in a written statement. CPKC has about 3,000 engineers, conductors and dispatchers involved.

Perrin Beatty, president and CEO of the Canadian Chamber of Commerce, said the union’s latest actions “will prolong the damage to our economy and jeopardize the wellbeing and livelihoods of Canadians, including union and nonunion workers across multiple industries.”

Labor Minister Steven MacKinnon announced the decision to force the parties into binding arbitration Thursday afternoon, more than 16 hours after the lockout shut down the railroads, saying the economic risk was too great to allow them to continue. The government had declined to order arbitration two weeks ago. MacKinnon said he had hoped that negotiations between the companies and the union on a new contract would succeed.

“This is not about disobeying the minister’s order. It’s about exercising our right,” Teamsters Canada President Francois Laporte said Friday in announcing the strike. “We will exercise our right within the legal framework.”

Canadian National trains had begun rolling at 7 a.m. across Canada, said CN spokesperson Jonathan Abecassis. The development initially appeared to at least partially end a work stoppage that threatened to wreak havoc on the economies of Canada and the United States. Both countries, across all industries, rely on railroads to deliver their raw materials and finished products.

“While CN is focused on its recovery plan and powering the economy, Teamsters are focused on getting back to the picket line and holding the North American economy hostage to their demands,” Abecassis said following the union’s strike notice.

Getting even one of the railroads running again is a relief for businesses. In most past rail labor disputes, only one of the Canadian railroads stopped and the economy was able to weather that disruption.

The negotiations that began last year are hung up on issues around the way workers are scheduled and contract rules designed to prevent fatigue. The railroads had proposed shifting away from the current system that pays workers based on the number of miles they travel, to a system based on the hours they work. The railroads said the switch would make it easier to provide predictable schedules. But the union resisted because it feared the proposed changes would erode hard-fought protections against fatigue and jeopardize safety.

In Canada, another issue at CN is the railroad’s intention to expand a system that allows it to temporarily relocate workers to other parts of its network when it’s short on employees in a certain region.

Regarding wages, the railroads said they both offered raises in line with other recent deals in the industry for what are already well-paying jobs. Canadian National has said its engineers make about $150,000 and conductors earn roughly $121,000 for working 160 days a year, although some of their time off is spent stuck at hotels on the road between train trips while getting required rest. CPKC says its pay is comparable.

Nearly all of Canada’s freight handled by rail — worth more than $730 million a day and adding up to more than 375 million tons of freight last year — stopped Thursday along with rail shipments crossing the U.S. border.

About 30,000 commuters in Canada were also affected because their trains use CPKC’s lines. CPKC and CN’s trains continued operating in the U.S. and Mexico during the lockout.

Billions of dollars of goods move between Canada and the U.S. via rail each month, according to the U.S. Department of Transportation.

“There are a lot of goods and services shipped across borders,” Sean O’Brien, president of the International Brotherhood of Teamsters, said at a rally in Calgary, Alberta, on Friday. “If this company chooses to continue its bad behavior, then it is going to have an impact. … They’ve got a lot of decisions they need to make. And they need to make the most important decision: Reward these workers with what they’ve earned and don’t try to diminish safety just so they need to feed their bottom lines.”
…

JACKSON HOLE, Wyoming — The Federal Reserve’s credibility in the eyes of financial markets helped in its battle against inflation over the past two years, but it had to be earned afresh with interest rate hikes that backed up policymakers’ verbal promises to restore price stability, according to new research presented at the Kansas City Fed’s annual research conference in Jackson Hole, Wyoming.

A strong perception in financial markets that a central bank is committed to inflation control can make monetary policy more effective, prompting markets to shift financial conditions faster and lowering inflation with a less-serious hit to economic growth than would otherwise be the case.

While investors came to believe that the U.S. central bank under the leadership of Fed Chair Jerome Powell was serious about defending its 2% inflation target, that belief only formed over time and after the officials began raising the policy interest rate in March 2022 and accelerated the rate hikes over that summer, the researchers found.

“Forecasters and markets were highly uncertain about the monetary policy rule prior to ‘liftoff’ and learned about it from the Fed’s rate hikes,” economists Michael Bauer from the San Francisco Fed, Carolin Pflueger from the University of Chicago, and Adi Sunderam from the Harvard Business School, found in their research. “Substantial rate hikes were apparently necessary for perceptions to shift. … The public did not fully understand the Fed’s strategy and policy rule prior to liftoff.”

The research serves as a warning of sorts against central bankers putting too much weight on the power of “talk therapy” — or the ability to influence economic outcomes with words and promises alone.

Earning public trust

The Fed in recent years has been characterized by a surfeit of speeches and public comments by its officials, whether by the head of the central bank, other members of its presidentially appointed Board of Governors, or its 12 regional bank presidents, under the notion that more transparency is good for public accountability and makes policy more effective.

Fed officials in the recent inflation battle often noted that public belief in their commitment to the inflation target would help on its own to lower the pace of price increases, shorten the time it took for tighter monetary policy to have an impact, and lower inflation with less damage to the job market and other aspects of the “real” economy.

The researchers found, however, that while the Fed under Powell eventually earned the benefit of public trust, it also wasn’t a given.

The research used survey data to quantify how professional forecasters perceived the Fed would respond to higher inflation and found that even as prices began rising in 2021 the expected Fed response to inflation was near zero.

While that could have been attributed to several factors, including a belief that inflation would ease on its own, the researchers concluded it was because forecasters weren’t sure how the central bank would react.

After the first rate increase in March of 2022, however, perceptions began to shift, with forecasters eventually expecting the Fed to respond on an almost one-for-one basis to any rise in inflation.

The change in perceptions coincided with policymakers shifting from the initial quarter-percentage-point move to the first of four 75-basis-point hikes in June 2022, and with a stern speech by Powell at that year’s Jackson Hole conference that reaffirmed his intent to defend the inflation target despite the economic pain it might cause.

As market perceptions about the Fed’s sensitivity to inflation increased, “interest rates became significantly more sensitive to inflation data surprises,” the research found, adding that “the increase in the perceived inflation response likely aided the transmission of monetary policy to the real economy and improved the Fed’s inflation-unemployment tradeoff.”

For future policymakers, the researchers said, the conclusion is clear: Actions speak louder than words.

“Policy rate actions contribute to, and may even be necessary for, the effectiveness of communication, particularly when uncertainty about the monetary policy framework is high,” they found, suggesting the Fed’s quarterly Summary of Economic Projections could be changed to make the central bank’s “reaction function” more explicit. “A timely policy rate response to inflation matters not only for influencing immediate financial conditions, but also for signaling that policymakers are serious.”
…

Jakarta, Indonesia — Cellphones, electric pots and pans, and car washing machines were among goods worth $1.3 million destroyed Monday by the Indonesian Trade Ministry in West Java. Alcoholic drinks with an ethyl alcohol or ethanol content ranging from 5% to 20% were also destroyed.

The ministry demolished the goods as part of the government’s crackdown on illegal imports, a major issue that experts say stems from Indonesia’s unpreparedness for the ASEAN-China Free Trade Agreement signed 15 years ago.

Trade Minister Zulkifli Hasan said the goods did not comply with state regulations and lacked a surveyor’s report, goods registration number, or import approval, and exceeded import quotas or failed to meet Indonesian national standards.

This is the third operation conducted by the Trade Ministry, following operations at the Cikarang customs and excise storage area in West Java and at Jakarta’s Cengkareng Port.

On August 6, the Trade Ministry disclosed that $2.9 million of illegal imports were found at the Cikarang facility. The Trade Ministry confiscated 20,000 textile rolls. The National Police seized 1,883 bales of used clothing, while customs’ officers at Tanjung Priok port seized 3,044 bales of used clothing. In addition, hundreds of carpets, towels, cosmetics, footwear and more than 6,500 electronics were seized.

Since its establishment in July, the Anti-Illegal Imports Task Force has been investigating illegal import schemes, collecting data and seizing illegal goods.

The head of the Indonesian National Police’s criminal investigation unit, Wahyu Widada, said, “Illegal imports not only harm the country in terms of revenue loss, but also has an impact on small and medium scale entrepreneurs.”

Mohammad Faisal, executive director of the Center on Reform of Economics, links the current problem to Indonesia’s unpreparedness when it signed the ASEAN-China Free Trade Agreement 15 years ago.

“Indonesia’s domestic industries were not ready to compete with China’s competitive products in the local market. Indonesia had a huge domestic market and very low trade barriers then. It’s not just tariff barriers but also the non-tariff barriers were very limited. So that’s why it’s actually easy for foreign suppliers to enter the Indonesian market,” Faisal said.

According to recent data from the Ministry of Cooperatives and Small and Medium-sized Enterprises (SMEs), approximately 50% of imported textiles and textile products are unregistered. That means the state loses out on $399 million from unpaid taxes and excise duties.

In 2022, China exported $3.95 billion of textiles to Indonesia but only $2.04 billion of Chinese textile imports were recorded. Overall, the financial loss is equal to the potential creation of 67,000 jobs and over $762 million in gross domestic product. Indonesia’s GDP in 2023, according to the World Bank, was $1.37 trillion.

Zulkifli said one of the major obstacles to fighting illegal imports is the existence of an underground economy. The Minister of Cooperatives and SMEs, Teten Masduki, said that almost 30% to 40% of goods sold in Indonesian markets are involved in the underground economy and therefore the state does not receive taxes on them.

As a result, Zulkifli added that Indonesia’s tax ratio is lower than other developed Asian nations such as South Korea, Japan and China.

“Imagine if we sent illegally imported goods to South Korea or China. Don’t expect that to happen, it’s impossible. That’s why these nations can become developed countries. If our “house” continues to get burglarized, how can we move forward?” he said.

Zulfkli announced in late June a plan to impose stiff tariffs of up to 200% on some products. The plan, which is still under review, initially was announced as an import duty on Chinese goods, but the minister said later the duties would apply to all countries.

Indonesia’s Shopping Center Retail and Tenant Association has detected shops suspected of selling illegally imported goods online across North Sumatra to East Java, and some have opened shops at Jakarta’s wholesale shopping centers.

Budihardjo Iduansjah, chairman of the association, said “These Chinese entrepreneurs store their goods at local warehouses and sell them online. But now many have started selling at shops including at International Trade Centers.”

During a visit to shops suspected of selling illegally imported goods from China, VOA spotted clothing with labels written in Mandarin that were sold for $1 each. A seller there admitted that he and many other sellers sold their goods online and shipped the clothes in bulk to resellers across the country.

Zulkifli claims that the investigations carried out by his task force have caused many foreign nationals suspected of dealing in illegal imports to leave.

He plans to work with universities to research the root causes of illegal imports. He is confident that the illegal imports crackdown will continue under President-elect Prabowo Subianto, who will be inaugurated in October.
…

JACKSON HOLE, Wyoming — With the Federal Reserve considered certain to start cutting its benchmark interest rate next month, Chair Jerome Powell’s highly anticipated speech Friday morning at an economic conference will be closely watched for any hints about how many additional rate cuts might be in the pipeline.

Powell is expected to say the Fed has become more confident that inflation is nearing its 2% target, more than two years after it hit a painful four-decade high. Yet the Fed chair may take an overall cautious approach in his remarks at an annual conference of central bankers in Jackson Hole, Wyoming. Economists note that forthcoming economic data, including a monthly jobs report on Sept. 6, will help determine the size of future Fed rate cuts — whether a typical quarter-point cut or a more aggressive half-point drop — and how fast they occur.

“We think he will seek to dampen expectations of [a half-point cut] as well as reiterate that the Fed is data-dependent and does not make decisions in advance,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in a research note.

Powell’s speech comes as the central bank is moving toward achieving a much sought-after “soft landing,” in which its rate hikes — 11 of them in 2022 and 2023 — manage to curb inflation without causing a recession. Inflation was just 2.5% in July, according to the Fed’s preferred measure, having tumbled from a 7.1% peak two years ago.

The progress made on inflation has likely made many Fed officials more open to cutting rates several times this year now that elevated borrowing costs have largely succeeded in cooling the economy and taming inflation.

Still, a slowdown in hiring and an uptick in the unemployment rate last month heightened concern that the Fed could soon make a mistake in the other direction — by keeping rates too high for too long, throttling growth and plunging the economy into recession. Powell will likely refer to that balancing act in his speech Friday.

On Wednesday, minutes from the Fed’s most recent meeting, held July 30-31, showed that the “vast majority” of policymakers said at the time that they would likely support a rate reduction at the next meeting in mid-September as long as inflation stayed low. Several of the Fed’s 19 officials even supported a rate cut at that meeting, the minutes showed.

Also Wednesday, the Labor Department revised its estimate of job growth for the 12 months that ended in March: It said that 818,000 fewer jobs were added during that year than it had earlier reported. The revisions, which were preliminary, will be finalized in February.

Hiring over that period was still solid, averaging 174,000 a month rather than 242,000, the government said. Yet because the figures show that hiring wasn’t as robust as was previously thought, a Fed rate cut next month is “a certainty,” Shepherdson wrote.

Economists generally agree that the Fed is getting closer to conquering high inflation, which brought hardship to millions of households beginning three years ago as the economy rebounded from the pandemic recession. Yet few economists think Powell or any other Fed official is prepared to declare “mission accomplished.”

After the government reported this month that hiring in July was much less than expected and that the jobless rate reached 4.3%, the highest in three years, stock prices plunged for two days on fears that the U.S. might fall into a recession. Some economists began speculating about a half-point Fed rate cut in September and perhaps another identical cut in November.

But healthier economic reports last week, including another decline in inflation and a robust gain in retail sales, partly dispelled those concerns. Wall Street traders now expect the Fed to cut its benchmark rate by a quarter-point in both September and November and by a half-point in December. Mortgage rates have already started to decline in anticipation of rate reductions.

A half-point Fed rate cut in September would become more likely if there were signs of a further slowdown in hiring, some officials have said.

Raphael Bostic, president of the Fed’s Atlanta branch, said in an interview Monday with The Associated Press that “evidence of accelerating weakness in labor markets may warrant a more rapid move, either in terms of the increments of movement or the speed at which we try to get back” to a level of rates that no longer restricts the economy.

“I’ve got more confidence that we are likely to get to our target for inflation,” he said. “And we’ve seen labor markets weaken considerably relative to where they were” last year. “We might need to shift our policy stance sooner than I would have thought before.” Several months earlier, Bostic had said he would likely support just one rate cut in the final three months of the year.
…

Windhoek, Namibia — Namibia’s minister of agriculture has urged farmers in the Southern African country to look at alternative markets for its charcoal and beef products since the European Union, one of its largest trading partners, has implemented nontariff barriers that came into force in 2023.

A unilateral decision by the European Union to impose regulations on agricultural products from Namibia that come from areas that have been deforested has raised concerns regarding market access for products such as beef and charcoal.

These products will no longer have access to the European market unless they comply with the new rules that Namibian Minister of Agriculture Calle Schlettwein describes as stringent and prohibitive.

“When you want to conduct agriculture, you have to clear lands. We have [the] charcoal industry. We have a number of industries in the agricultural sector where we do have an impact on deforestation. And I said that farmers must be careful that if they do that, they must be in compliance with these regulations.”

The chairperson of the Namibia Biomass Industry Group, which represents over 150 members in the sector, Colin Lindeque, says the European Union Deforestation Regulation (EUDR) will not negatively impact exports to the EU.

He said the EU is only asking for additional information. It wants geographic location tags that show that the charcoal they are exporting does not come from areas that have been deforested, but rather areas that are regarded as savannah, an argument with which Schlettwein disagrees.

Lindeque told VOA the regulations are fair, and the members of the Bio-mass Industry Group are compliant and meet the new EU requirements.  

“There was a consultant here recently from the EU looking at EUDR, and they specifically said Namibia’s bush encroachment is definitely not a forest in their opinion. But one of the challenges is our government hasn’t made the distinction, and that is actually the bigger point of interest, because we in the current Forest Act of 2001 do not even define what a forest is.”

Director of Forestry at Namibia’s Ministry of Environment, Johnson Ndokosho, says the ambiguities in the country’s law regarding what is considered a forest, woodlands and savannah are being dealt with in the new Forestry Act, which is being revised.

He cautioned that Namibia is at the mercy of the EU when it comes to whether Namibia’s beef and charcoal will still be able to enter their market.

“If they found that maybe this beef is coming out of an area where deforestation is occurring, then that may affect our exports.”

Last year, Namibia exported 270,000 tons of charcoal worth $72 billion (1.3 billon NAD) mainly to South Africa, which then exports it to other markets, including Europe. Europe is the top destination for Namibia’s beef, with the union consuming about 80 percent of the country’s total exports valued at roughly $23.5 million (420 million NAD).

Namibia is not the only country affected by the new EU regulations. Other countries include Brazil, Cameroon and Nigeria.

Products that are affected by the new EU regulations include cocoa, soy, palm oil and coffee.
…

…

…

Seoul — Women’s accessories sold by some of the world’s most popular online shopping firms contained toxic substances sometimes hundreds of times above acceptable levels, authorities in Seoul said Wednesday.   

Chinese giants including Shein, Temu and AliExpress have skyrocketed in global popularity in recent years, offering a vast selection of trendy clothes and accessories at stunningly low prices that has helped them take on U.S. titan Amazon.   

The explosive growth has led to increased scrutiny of their business practices and safety standards, including in the European Union and South Korea, where Seoul officials have been conducting weekly inspections of items sold by online platforms.   

In the most recent inspection, 144 products from Shein, AliExpress and Temu were tested, and multiple products from all companies failed to meet legal standards.   

Shoes from Shein were found to contain significantly high levels of phthalates — chemicals used to make plastics more flexible — with one pair 229 times above the legal limit.   

“Phthalate-based plasticizers affect reproductive functions such as sperm count reduction, and can cause infertility and even premature birth,” an official from Seoul’s environmental health team told AFP.   

One such chemical “is classified as a human carcinogen by the International Cancer Institute, so special care should be taken to avoid long-term contact with the human body,” they added.   

Formaldehyde, a chemical commonly used in home building products, was detected in Shein’s caps at double the allowable threshold.   

Two bottles of nail polish from Shein were found to have dioxane — a possible human carcinogen that can cause liver poisoning — at levels more than 3.6 times the allowed limit and methanol concentrations 1.4 times above the acceptable level.    

Lead in sandals 

Shein told AFP that they “work closely with international third-party testing agencies… to regularly carry out risk-based sampling tests to ensure that products provided by suppliers meet Shein’s product safety standards.”   

“Our suppliers are required to comply with the controls and standards we have put in place as well as the product safety laws and regulations in the countries we operate in,” the company added.   

Seoul authorities found sandals from Temu contained lead in the insoles at levels more than 11 times the permissible limit.   

“Upon receiving notice from the Seoul city government, we immediately launched an internal investigation,” a spokesperson from Temu told AFP.   

“We have swiftly removed these product listings from our global marketplace and are enhancing our systems and guidance to merchants to ensure they comply with safety standards and local regulations.”   

Seoul officials asked for all the products to be removed from sale, according to a government statement.   

“Products that exceed the legal limit are products that directly contact the body, such as leather sandals and hats, so citizens should pay special attention,” said Kim Tae-hee, an official in the capital.   

“The Seoul Metropolitan Government will continue to conduct safety tests periodically and disclose the results.”   

The European Union in April added Shein to its list of digital firms that are big enough to come under stricter safety rules — including measures to protect customers from unsafe products, especially those that could be harmful to minors. 
…

Bangkok — Ethnic and resistance forces in Myanmar have completely blocked a key trade route to China, halting cross-border commerce and further damaging Myanmar’s already struggling economy.

The Mandalay-Lashio-Muse Road is considered the most strategically important road in the country’s northern Shan State.

Formerly known as the “Burma Road,” locals commonly call it the “pearl necklace,” as it connects Myanmar’s second largest city of Mandalay with the Chinese border. The string of pearls of trade towns already captured by rebel forces include Nawnghkio, Kyaukme, Lashio, Hsenwi, Kutkai and Muse near China’s southern border of Yunan province.

Lway Yay Oo, spokeswoman for the Ta’ang National Liberation Army, or TNLA, told VOA that right now “there are battles all along the trade route.” That has increasingly been the case, she said, since the second phase of operation 1027 began several weeks ago.

The TNLA is part of the “Three Brotherhood Alliance,” along with the Arakan Army, AA and the Myanmar National Democratic Alliance Army, or MNDAA.

The first phase of the 1027 rebel offensive, which is named after the date it began, began on October 27, 2023.

The recent capture of several key towns along the trade route in a relatively short span of time has been widely seen as a potential turning point in the resistance as rebels look to cement control and further loosen the grip of junta forces the region.

The military government isn’t giving in easily, however, with intense battles along the route making trade nearly impossible.

“The TNLA and joint forces control the entire border trade route with the cities of Kutkai, Lashio, Kyaukme and Hsipaw, except for Muse,” Lway Yay Oo added. “Although we are prepared to keep businesses operating, we’ve had to stop border trade due to fierce fighting.”

Myanmar’s trade crisis deepens

The ongoing conflict and capture of key trading towns is already having an impact.

“Myanmar’s trade sector depends mostly on border trade,” said one Yangon-based businessman, who requested anonymity due to security reasons during a phone interview with VOA. “Air trade is very expensive now, and maritime trade takes a long time, so we must rely on border trade routes.”

With main trade routes closed, businesses are looking to find alternate routes.

“Trade flows are slower than they should be, and we are spending more on transportation, leading to further losses,” the man said. There is also an impact on consumers as the ripple effect of higher transportation costs, currency fluctuations and slower trade spreads to the general population.

“When these things happen, consumers also suffer,” he said, adding that right now “with demand so low, our revenue has dropped by about 50%.”

Earlier in June, the World Bank downgraded Myanmar’s economic growth forecast to just 1% for the 2024-2025 fiscal year, citing the intensifying conflict, labor shortages and a depreciating currency as key challenges. And that was just as the second phase of operation 1027 was beginning.

Impacting the junta

According to the Ministry of Commerce’s statistics, the border trade value between Myanmar and China totaled US$416.867 million in the first two months of the current financial year 2024-2025, which began on April 1.

It is a significant decline from the $640.43 million recorded during the same period last year, and a decrease of $223.564 million.

So far, for its part, Myanmar’s military rulers are playing down the impact the conflict is having.

“Despite the challenges posed by recent conflicts, we continue to facilitate trade with our neighboring countries, especially China,” a representative from Myanmar’s Ministry of Commerce said in June, according to state media. The ministry has not commented on the impact fighting has had on the economy since then.

Opposition forces disagree and say the success of the resistance has significantly weakened the junta’s ability to manage the economy, including trade.

“The revolutionary forces have grown stronger militarily and now control more territory,” said Min Zayar Oo, the NUG Deputy Minister of Planning, Finance, and Investment, in an interview with VOA.

Min Zayar Oo added that part of this is because of the junta’s mismanagement.

“Stability and clear policy are essential for business, but the military council has failed to provide this,” he said.

Commodity prices are soaring due to inflation and recent efforts by the junta, such as printing new currency notes, have only worsened the economic situation, he adds.

“Cross-border trade routes are disrupted, foreign currency is scarce, and the junta is struggling to provide basic services. The economic front, like the military front, is already collapsing,” he said.

The economic downturn is also impacting military funding, former army Major Naung Yoe told VOA in a telephone interview.

“No matter how much the junta increases the military spending budget, if the country doesn’t have foreign currency, the military spending will also be affected,” he said.

Border trade stalls, Kyat at record low

As fighting continues and trade stalls and the value of Myanmar’s currency the Kyat plummets, many business owners are hoping a resumption of stability will come soon.

“Every day that the fighting continues, our businesses suffer,” one medium-sized entrepreneur based in Yangon told VOA, who requested anonymity for security reasons. “We rely on cross-border trade, and with the current situation, it feels as though we have been cut off from the rest of the world.”

In late June, the Kyat hit a record low in foreign exchange markets, exacerbating the financial crisis faced by many in the country.

“We are struggling to keep our operations afloat,” another entrepreneur noted. “The depreciation of the kyat is making imports prohibitively expensive, and we cannot raise prices without losing customers.”

As the conflict rages on, the future of Myanmar’s economy remains uncertain, with many calling for an urgent resolution to restore stability and revive trade. “We need peace to rebuild our businesses and our country,” the Yangon based entrepreneur added. “Without it, we are all at risk.”
…

Washington — Federal Reserve officials have said they’re increasingly confident that they’ve nearly tamed inflation. Now, it’s the health of the job market that’s starting to draw their concern.

With inflation cooling toward its 2% target, the pace of hiring slowing and the unemployment rate edging up, the Fed is poised to cut its benchmark interest rate next month from its 23-year high. How fast it may cut rates after that, though, will be determined mainly by whether employers keep hiring. A lower Fed benchmark rate would eventually lead to lower rates for auto loans, mortgages and other forms of consumer borrowing.

Chair Jerome Powell will likely provide some hints about how the Fed sees the economy and what its next steps may be in a high-profile speech Friday in Jackson Hole, Wyoming, at the Fed’s annual conference of central bankers. It’s a platform that Powell and his predecessors have often used to signal changes in their thinking or approach.

Powell will likely indicate that the Fed has grown more confident that inflation is headed back to the 2% target, which it has long said would be necessary before rate cuts would begin.

Economists generally agree that the Fed is getting closer to conquering high inflation, which brought financial pain to millions of households beginning three years ago as the economy rebounded from the pandemic recession. Few economists, though, think Powell or any other Fed official is prepared to declare “mission accomplished.”

“I don’t think that the Fed has to fear inflation,” said Tom Porcelli, U.S. chief economist at PGIM Fixed Income. “At this point, it’s right that the Fed is now more focused on labor versus inflation. Their policy is calibrated for inflation that is much higher than this.”

Still, how fast the Fed cuts rates in the coming months will depend on what the economic data shows. After the government reported this month that hiring in July was much less than expected and that the jobless rate reached 4.3%, the highest in three years, stock prices plunged for two days on fears that the U.S. might fall into a recession. Some economists began speculating about a half-point Fed rate cut in September and perhaps another identical cut in November.

But healthier economic reports last week, including another decline in inflation and a robust gain in retail sales, have largely dispelled those concerns. Wall Street traders now expect three quarter-point Fed cuts in September, November and December, though in December it’s nearly a coin-toss between a quarter- and a half-point cut. Mortgage rates have already started to decline in anticipation of a rate reduction.

A half-point Fed rate cut in September would become more likely if there were signs of a further slowdown in hiring, some officials have said. The next jobs report will be issued on Sept. 6, after the Jackson Hole conference but before the Fed’s next meeting in mid-September.

Raphael Bostic, president of the Fed’s Atlanta branch, said in an interview Monday with The Associated Press that “evidence of accelerating weakness in labor markets may warrant a more rapid move, either in terms of the increments of movement or the speed at which we try to get back” to a level of rates that no longer restricts the economy.

Even if hiring stays solid, the Fed is set to cut rates this year given the steady progress that’s been made on inflation, economists say. Last week, the government said consumer prices rose just 2.9% in July from a year ago, the smallest such increase in more than three years.

Bostic noted that the economy has changed from just a couple of months ago, when he was suggesting that a rate cut might not be necessary until the final three months of the year.

“I’ve got more confidence that we are likely to get to our target for inflation,” he said. “And we’ve seen labor markets weaken considerably relative to where they were” last year. “We might need to shift our policy stance sooner than I would have thought before.”

Both Bostic and Austan Goolsbee, president of the Fed’s Chicago branch, say that with inflation falling, inflation-adjusted interest rates — which are what many businesses and investors pay most attention to — are rising even as inflation has slowed. When the Fed first set its key rate at its current 5.3%, inflation — excluding volatile energy and food costs — was 4.7%. Now, it’s just 3.2%.

“Our policies are getting tighter with every moment in that type of situation,” Bostic said. “We have to be concerned” that rates are so high they could cause an economic slowdown.

Still, Bostic said that for now, the job market and the economy appear mostly healthy, and he still expects a “soft landing,” whereby inflation falls back to the Fed’s 2% target without a recession occurring.

With the economy’s outlook unclear and the Fed focusing heavily on what future data shows, there may be only so much Powell will be able to say Friday about the central bank’s next steps.

Given the Fed’s focus on how the economic data comes in, “it will be difficult for Powell to pre-commit to a particular trajectory at Jackson Hole,” Matthew Luzzetti, chief U.S. economist at Deutsche Bank, said in a research note.
…

CHENNAI — A group of Indian port workers’ unions has called for a strike from Aug. 28 to demand immediate settlement of pay revisions and pension benefits, according to a note signed by its members. 

A strike by India’s port workers could exacerbate the existing congestion issues at Asian and European ports, leading to further delayed shipments, which have a global impact on trade and commerce. 

The country’s shipping ministry formed a bipartite wage negotiation committee in March 2021, and the workers submitted their demands six months later, ahead of the expiration of the previous agreement in December of that year, according to the note. 

Although the wage negotiation committee met seven times, it failed to meet the port workers’ demands, the note said. 

The workers’ group agreed to call for a strike after a meeting this month in Thoothukudi, a port city in the southern state of Tamil Nadu.  

The government and port management should consider demands such as pay scale revisions, payment of arrears and protection of exiting benefits to help avoid the strike, the workers’ group said in the note. 

India’s federal shipping ministry did not immediately respond to a Reuters request for comment. 

The annual cargo handling capacity of major Indian ports such as Chennai, Cochin and Mumbai totaled 1.62 billion metric tons, according to the shipping ministry. 

In the fiscal year to March 31, 2024, India exported goods worth $437 billion, with imports estimated at $677 billion. 

 
…

Washington — Four years after Federal Reserve Chair Jerome Powell made fighting unemployment a bigger priority during the COVID-19 pandemic, he faces a pivotal test of that commitment amid rising joblessness, mounting evidence inflation is under control, and a benchmark interest rate that is still the highest in a quarter of a century.   

High interest rates may be on the way out, with the U.S. central bank expected to deliver a first cut at its Sept. 17-18 meeting and Powell potentially providing more information about the approach to the policy easing in a speech on Friday at the Kansas City Fed’s annual conference in Jackson Hole, Wyoming.   

But with the Fed’s policy rate in the 5.25%-5.50% range for more than a year, the impact of relatively high borrowing costs on the economy may still be building and could take time to unwind even if the central bank starts cutting — a dynamic that could put hopes for a “soft landing” of controlled inflation alongside continued low unemployment at risk.   

“Powell says the labor market is normalizing,” with wage growth easing, job openings still healthy, and unemployment around what policymakers see as consistent with inflation at the central bank’s 2% target, former Chicago Fed President Charles Evans said. “That would be great if that is all there is. The history is not good.”   

Indeed, increases in the unemployment rate like those seen in recent months are typically followed by more.   

“That does not seem the situation now. But you may only be one or two poor employment reports away” from needing aggressive rate cuts to counter rising joblessness, Evans said. “The longer you wait, the actual adjustment becomes harder to make.” 

Inflation versus employment  

Evans was a key voice in reframing the Fed’s policy approach, unveiled by Powell at Jackson Hole in August 2020 as the pandemic was raging, policymakers were gathering via video feed, and the unemployment rate was 8.4%, down from 14.8% that April.   

In that context the Fed’s shift seemed logical, changing a long-standing bias towards heading off inflation at the expense of what policymakers came to view as an unnecessary cost to the job market.   

Standard monetary policymaking saw inflation and unemployment inextricably and inversely linked: Unemployment below a certain point stoked wages and prices; weak inflation signaled a moribund job market. Officials began to rethink that connection after the 2007-2009 recession, concluding they needn’t treat low unemployment as an inflation risk in itself.   

As a matter of equity for those at the job market’s margins, and to achieve the best outcomes overall, the new strategy said Fed policy would “be informed by assessments of the shortfalls of employment from its maximum level.”   

“This change may appear subtle,” Powell said in his 2020 speech to the conference. “But it reflects our view that a robust job market can be sustained without causing an outbreak of inflation.”   

A pandemic-driven inflation surge and dramatic employment recovery made that change seem irrelevant: The Fed had to raise rates to tame inflation, and until recently the pace of price increases had slowed without much apparent damage to the job market. The unemployment rate through April had been below 4% for more than two years, an unparalleled streak not seen since the 1960s. The unemployment rate since 1948 has averaged 5.7%.   

But the events of the last two years, and a coming Fed strategy review, have also triggered a wave of research into exactly what happened: why inflation fell, what role policy played in that, and how things might be done differently if inflation risks rise again.   

While the agenda for this year’s conference remains under wraps, the broad theme focuses on how monetary policy influences the economy. That bears on how officials may evaluate future choices and tradeoffs and the wisdom of tactics like preempting inflation before it starts.   

Some of that work is already emerging from Fed researchers, including top economist Michael Kiley. He has authored a paper questioning whether policy “asymmetry” — treating employment shortfalls differently than a tight labor market, for example — really helps. Another recent paper suggested policymakers who believe public inflation expectations are formed in the short-run and are volatile should react sooner and raise rates higher in response.   

The role public expectations play in driving inflation — and the policy response – was on full display in 2022. When it appeared expectations risked moving higher, the Fed pushed its tightening cycle into overdrive with 75-basis-point hikes at four consecutive meetings. Powell then used a truncated Jackson Hole speech to emphasize his commitment to fight inflation —a stark shift from his jobs-first commentary two years earlier.   

It was a key moment that put the U.S. central bank’s seriousness on display, underpinned its credibility with the public and markets, and rebuilt some of the standing that preemptive policies had lost.   

‘Too tight’ 

Powell now faces a test in the other direction. Inflation is progressing back to 2%, but the unemployment rate has risen to 4.3%, up eight-tenths of a percentage point from July 2023.   

There’s debate over what that really says about the labor market versus rising labor supply, a positive thing if new job seekers find employment.   

But it did breach a rule-of-thumb recession indicator, and while that has been downplayed given other indicators of a growing economy, it also is slightly above the 4.2% that Fed officials regard as representing full employment.   

It’s also higher than at any point in Powell’s pre-pandemic months as Fed chief: It was 4.1% and falling when he took over in February 2018.   

The “shortfall” in employment that he promised to respond to four years ago, in other words, may already be taking shape.   

While Powell will be reluctant to ever declare victory over inflation for fear of touching off exuberant overreaction, Ed Al-Hussainy, senior global rates strategist at Columbia Threadneedle Investments, said it was past time for the Fed to get in front of the risk to unemployment – preemption of a different sort.   

Al-Hussainy said the Fed had proved its ability to keep public expectations about inflation in check, an important asset, but that “also has put in motion some downside risk to employment.”   

“The policy stance today is offside — it is too tight — and that warrants acting on.” 
…

NEW YORK — Hopes for an economic soft landing are once again powering U.S. stocks higher, as encouraging data relieve recession worries following a brutal sell-off earlier this month.

The S&P 500 .SPX has rebounded more than 6% since Aug. 5, when a steep drop pushed the benchmark U.S. index to its biggest three-day slide in over two years. A rapid return to calm was also evident in the Cboe Volatility Index .VIX, or Wall Street’s “fear gauge,” which has retreated from last week’s four-year highs at a record pace.

Driving the turnaround are last week’s reports on retail sales, inflation and producer prices, which helped allay worries over an economic slowdown sparked by weaker-than-expected employment data at the start of the month. The favorable data has bolstered the case for investors looking to hop back aboard many of the trades that have worked this year, from buying Big Tech stocks to a more recent bet on small and mid-cap names that accelerated in July.

“There was a real growth scare that had emerged,” said Mona Mahajan, senior investment strategist at Edward Jones. “Since then, what we’ve seen is the economic data has actually come out in a much more positive light.”

Some of 2024’s biggest winners have staged strong rebounds since Aug. 5. Chipmaker Nvidia NVDA.O has bounced more than 20%, while the Philadelphia SE Semiconductor index .SOX has gained more than 14%. Small-cap shares, which had been strong performers in July, have also recovered from recent lows, with the Russell 2000 .RUT up nearly 5%.

Meanwhile, traders are unwinding bets that the Federal Reserve will need to deliver jumbo-sized rate cuts in September to stave off a recession.

As of late Thursday, futures tied to the Fed funds rate showed traders pricing a 25% chance that the central bank will lower rates by 50 basis points in September, down from around 85% on Aug. 5, CME FedWatch data showed. The probability of a 25 basis point cut stood at 75%, in line with expectations that the Fed will kick off an easing cycle in September.

“You can’t necessarily rule out the hard landing scenario outright, but there’s a lot of reason to believe that at this point that economic momentum is being sufficiently sustained,” said Jim Baird, chief investment officer with Plante Moran Financial Advisors.

The Fed’s plans could become clearer when Chair Jerome Powell speaks at the central bank’s annual economic policy symposium in Jackson Hole, Wyoming.

“We think a key highlight of Powell’s speech will be the acknowledgement that progress on inflation has been sufficient to allow the start of rate cuts,” economists at BNP Paribas said in a note on Thursday.

For the year, the S&P 500 is up more than 16% and is within about 2% from its July all-time closing high.

Mahajan, of Edward Jones, expects the soft-landing scenario, combined with lower interest rates, to help pave the way for more stocks to participate in the market’s rally, instead of the small number of megacaps that have led indexes higher for much of this year.

Analysts at Capital Economics believe that a U.S. economic soft landing will support the artificial intelligence fervor that helped drive markets higher.

“Our end-2024 forecast for the S&P 500 remains at 6,000, driven by a view that the AI narrative which dominated in the first half of the year will reassert itself,” they wrote. That target would be some 8% from the S&P 500’s closing level on Thursday.

The recent economic data, while reassuring, is far from an all-clear for markets heading into September, which has historically been one of the year’s more volatile periods. Investors will be closely watching Nvidia’s earnings at the end of the month, and another employment report on Sept. 6.

“There’s been a sigh of relief in the market, clearly,” said Quincy Krosby, chief global strategist at LPL Financial. “The question now is, will the next payroll report underpin what the market expects at this point in terms of the soft landing.”
…

WASHINGTON — Kamala Harris is set to unveil plans for a federal ban on food and grocery “price gouging” and assistance of up to $25,000 in down payment support for first-time homeowners – populist proposals the vice president has embraced since becoming the Democratic Party’s presidential nominee.

Harris is scheduled to outline her proposals Friday, in her first speech on the economy focusing on dealing with rising grocery and housing prices – key concerns for voters. She is set to speak in front of supporters at a rally in Raleigh, North Carolina, a battleground state that she and former President Donald Trump, the Republican nominee, are vying to win in the November presidential election.

“In her first 100 days, Vice President Harris will work to enact a plan to bring down Americans’ grocery costs and keep inflation in check,” her campaign said in a memo to reporters Wednesday.

Harris aims to ensure “big corporations can’t unfairly exploit consumers to run up excessive corporate profits,” her campaign said, and will specifically call out the “highly consolidated” meat processing industry. “The lack of competition gives these middlemen the power to drive down earnings for farmers while driving up prices for consumers.”

Speaking to reporters Thursday, Trump called Harris’ proposal “communist price controls.”

“They don’t work, they actually have the exact opposite impact and effect,” he said. But it leads to food shortages, rationing, hunger, dramatically more inflation.”

In the U.S., the Federal Reserve sets interest rates independently, and presidential policies do not have much influence on lowering prices, at least in the short term.

“It is highly unlikely that any single policy introduced by a president could have a significant enough impact to bring inflation down from its current level to the Federal Reserve’s long-term target for the economy, which is 2%,” said Andrew Lautz, associate director for the Bipartisan Policy Center’s Economic Policy Program.

Trump has said he will fight rising prices by boosting oil and gas production. While increasing energy supply could have a downward pressure on prices, and in turn on inflation, it won’t happen quickly, Lautz told VOA.

Lower inflation

While Americans are still feeling the pain, last month U.S. year-over-year inflation dipped under 3% for the first time since March 2021. Unemployment remains low, retail sales figures are upbeat, and most economists no longer warn of recession.

Still the overall health of the economy remains a key concern for voters, and a point of attack on the campaign trail.

“The only thing Kamala Harris can deliver is horrific inflation, massive crime and the death of the American dream,” Trump said.

Both candidates have also promised to slash federal taxes on tips received by workers in the service and hospitality industry.

Critics say that proposal won’t help fast food servers or other low-income workers who don’t get tips and is vulnerable to abuse.

“How can we be sure that it’s deserving working people, as opposed to opening the door to a whole bunch of other people who might treat their bonuses and performance fees like tips and exempt themselves?” said Steven Rosenthal, senior fellow at the Tax Policy Center.

Such proposals are common during presidential campaigns, Rosenthal said. “We often see a race to the bottom, with the candidates trying to outbid themselves for how many tax cuts they can promise.”

If enacted, those promises will be costly at a time when the country needs to seriously think about fiscal responsibility and deficit reduction, said Lautz.

“We are at nearly $28 trillion in federal debt held by the public,” he said. “The Congressional Budget Office estimates that’s going to increase by another $20 trillion or so over the next decade.”

Trump previously held a commanding lead among voters on key economic issues, with various polls showing Americans think they will be better off financially under Trump than President Joe Biden.

However, a survey conducted for the Financial Times and the University of Michigan’s Ross School of Business published this week found that 41% trust Trump to be better at handling the economy, while 42% believe Harris would be better – a figure up seven points from Biden’s numbers in July. 
…

Washington — Sun Lijun, a 42-year-old semiconductor engineer, says worries about the quality of air and living, childhood education and the overall economic trajectory in China are some of the reasons he and his wife first started talking about moving to Japan almost a decade ago.

In 2021, they did just that, leaving their life in China behind and relocating with their two children to Okinawa.

Moving to Japan on a business management visa was a first step to “start over and then lead another lifestyle,” he told VOA.

Largest pool of residents

Sun is not alone. He is one of hundreds of thousands of Chinese nationals who have relocated to Japan, where they are now the largest group of immigrants.

According to data from the Japanese Immigration Service Agency, at the end of last year, 821,838 Chinese nationals were living in Japan, a 13% increase from 2022. Trends of Chinese immigration follow a broader increase in the number of foreigners relocating to Japan, which reached a record high of 3,410,992 people in 2023.

With an aging population and widespread labor shortages, Japan has been rolling out immigration reforms in a bid to attract more foreign nationals to the country.

Beginning in 2019, the Japanese government pushed to loosen qualifications that previously inhibited foreigners from establishing residence in the country. Now, those applying for business management visas and residency can bypass the country’s previously strict standards for special skills, education and residence qualifications.

Chinese demand

The changes in Japanese immigration policy have come with consequences. In the case of Chinese nationals, new residents have driven up housing prices and the rate of real estate development across the country.

Daniel Cheng, president of Wan Guo Jin Liang Company, told VOA that real estate developers in Tokyo often use Chinese sales teams, and that many Chinese-owned real estate companies focus on business with Chinese living in Japan or other places overseas.

Tokyo has attracted many middle-class and wealthy Chinese immigrants, and that has pushed up the average price of newly built central city apartments by nearly 40% from 2022, to around $780,000, according to a report issued by the Tokyo-based Real Estate Economic Institute. That’s much higher than the average price in the capital’s greater metropolitan area, which is about $550,000 for an apartment.

Chin JouSen’s real estate agency, Yuzawa, focuses on the Chinese market. He said that when looking at buying property in Japan, China’s wealthy mainly focus on preserving the value of their investment, whereas middle-class families are looking for a variety of choices that allow them to minimize the cost of living.

Cheng said that Japan’s stable political environment, good medical and social insurance, and property ownership rights are a key draw for Chinese. In China, by contrast, individuals may not own land.

Water Lee, a consultant with InterDots, a company that provides immigration services to people from Hong Kong, told VOA that Hong Kongers are also among those relocating to Japan — given the changes in the political environment in the port city in recent years.

Integration into Japan

Despite the impact of the surge of new foreign residents, the rising cost of housing in Japan’s capital, and the geopolitical rivalry between Tokyo and Beijing, Chinese migrants say public sentiment in Japan toward immigrants is positive.

Chin JouSen recently founded his real estate business in Japan. He said that integrating into Japanese society is the most important thing an immigrant can do. And based on his experience, the Japanese are friendly and accepting, Chin said.

However, while most Japanese people are friendly to foreigners, Tokyo-based aromatherapy business owner Michelle Takahashi, who is originally from Taiwan, told VOA that immigrants can sometimes feel subtle differences in how they are treated.

“Japanese thinking on service work can sometimes make foreigners feel like they are being treated specially or differently. This can be a challenge for foreigners who don’t speak Japanese,” she said.

The Japanese government provides new immigrants with specialists to help them adapt to the new language and culture.

Kazuhiko Isozaki founded Beru Corporation in 2017. The company invests in unused, vacant houses, renovates them and rents them out to disadvantaged groups at low prices. He fully welcomed the influx of foreign capital, especially Chinese capital, into Japan.

“The rise in land and housing prices has a positive impact on the economy, and foreign capital helps to drive up land prices,” he said.

“As Japan’s population continues to decline and incomes within the country fall, it makes sense from an economic perspective to more effectively assist overseas capital and people in entering Japan.”

He said he hopes to engage in business helping foreigners buy real estate in Japan in the future, mainly through education and support services, to reduce the barriers for foreigners to buy houses in Japan.

A slower, happier life

As for Sun and his family, they have settled in Okinawa, Japan’s sparsely populated island south of the main island. Sun says he enjoys the climate, slower pace of life and the internationalism he has found there.

For a while, Sun operated a coin laundry before transitioning to property management. His two daughters are learning Japanese in school.

“After immigrating to Japan, my quality of life and overall happiness of my family increased significantly,” Sun said.

VOA’s Katherine Michaelson contributed to this report.
…

…