Бізнес

China’s government announced plans to promote a consumer-led revival of the nation’s struggling economy as its legislature opened a session Sunday that will tighten President Xi Jinping’s control over business and society.

Premier Li Keqiang, the top economic official, set this year’s official growth target “around 5%” following the end of anti-virus controls that kept millions of people at home and triggered protests. Growth last year fell to 3%, the second-weakest level since at least the 1970s.

“We should give priority to the recovery and expansion of consumption,” Li said in a nationally televised speech on government plans before the ceremonial National People’s Congress in the Great Hall of the People in central Beijing.

The full meeting of the 2,977 members of the NPC is the year’s highest-profile event but its work is limited to endorsing decisions made by the ruling Communist Party and showcasing official initiatives.

This month, the NPC is set to endorse the appointment of a government of Xi loyalists including a new premier after the 69-year-old president expanded his status as China’s most powerful figure in decades by awarding himself a third five-year term as party general secretary in October, possibly preparing to become leader for life. Li, an advocate of free enterprise, was forced out as the No. 2 party leader in October.

Xi’s new leadership team will face challenges ranging from weak global demand for exports and lingering U.S. tariff hikes in a feud over technology and security to curbs on access to Western processor chips because of security fears. Beijing’s relations with Washington and its Asian neighbors have been strained by disputes over technology, security and control of the South China Sea.

In his report Sunday, the premier called for accelerating industrial and technology development, an area in which Beijing’s state-led efforts have strained relations with Washington and other trading partners. They complain China steals or pressures foreign companies to hand over technology and improperly subsidizes and shields its fledgling competitors in violation of its market-opening commitments.

Xi earlier singled out encouraging jittery consumers and entrepreneurs to spend and invest as a priority at the ruling party’s economic planning meeting in December.

Beijing needs to “fully release consumption potential,” Xi said, according to a text released last month.

Since taking power in 2012, Xi has promoted an even more dominant role for the ruling party. He has called for the party to return to its “original mission” as China’s economic, social and cultural leader and carry out the “rejuvenation of the great Chinese nation.”

Xi has crushed dissent, stepped up censorship and control over information, and tightened control over Hong Kong.

Xi’s government has tightened control over China’s biggest e-commerce and other tech companies with anti-monopoly and data security crackdowns that wiped billions of dollars off their stock market value. Beijing is pressing them to pay for social welfare and official initiatives to develop processor chips and other technology.

That has prompted warnings economic growth will suffer.

Li’s report Sunday reinforced the importance of state industry. It promised to support entrepreneurs who generate China’s new jobs and wealth but also said the government will “enhance the core competitiveness” of state-owned companies that dominate industries from banking and energy to telecoms and steel.

Li also called for “resolute steps” to oppose formal independence for Taiwan, the self-ruled island democracy claimed by Beijing as part of its territory. He called for “peaceful reunification” between China and Taiwan, which split in 1949 after a civil war, but announced no initiatives.

Taiwan never has been part of the People’s Republic of China, but Beijing says it is obligated to unite with the mainland, by force if necessary. Xi’s government has stepped up efforts to intimidate the island by flying fighter jets and bombers nearby and firing missiles into the ocean.

Chinese economic growth has struggled since mid-2021, when tighter controls on debt that Beijing worries is dangerously high triggered a slump in the vast real estate industry, which supports millions of jobs. Smaller developers were forced into bankruptcy and some defaulted on bonds, causing alarm in global financial markets.

Longer term, the workforce has been shrinking for a decade, putting pressure on plans to increase China’s wealth and global influence.

Consumer spending is gradually recovering, but the International Monetary Fund and some private sector economists forecast growth this year as low as 4.4%, well below the official target.

A measure of factory activity rose to a nine-year high in February. Other measures of activity including the number of subway passengers and express deliveries rose.

A central bank official said Friday real estate activity is recovering and lending for construction and home purchases is rising.

A recovery based on consumer spending is likely to be more gradual than one driven by stimulus spending or a boom in real estate investment. But Chinese leaders are trying to avoid reigniting a rise in debt and want to nurture self-sustaining growth based on consumption instead of exports and investment.

The official in line to become premier is Li Qiang, a former party secretary of Shanghai who is close to Xi but has no government experience at the national level. Li Qiang was named No. 2 party leader in October.

That reflects Xi’s emphasis on promoting officials with whom he has personal history and bypassing party tradition that leadership candidates need experience as Cabinet ministers or in other national-level posts.

If achieved, the official growth target would be an improvement over last year but down sharply from 2021’s 8.1%.
…

On a blustery late-winter day in Shakespeare’s birthplace, the foyer of the Other Place theater is a cozy refuge. Visitors are having meetings over coffee, checking emails, writing poetry, learning to sew.

It looks and feels like an arty café in the picturesque streets of Stratford-upon-Avon, but it’s a “warm hub” set up by the Royal Shakespeare Company drama troupe to welcome people struggling to heat their homes because of sky-high energy prices.

Warm hubs have sprouted across Britain by the thousands this winter as soaring food and energy prices drive millions to turn down the thermostat or skimp on hot meals. Research by the opposition Labour Party counted almost 13,000 such hubs, funded by a mix of charities, community groups and the government and nestled in libraries, churches, community centers and even a tearoom at King Charles III’s Highgrove country estate.

Wendy Freeman, an artist, writer and seventh generation Stratfordian, heard about the RSC’s warm hub from a friend. She lives in “a tiny house with no central heating” and relies on a coal fire for warmth. Like many, she has cut back in response to the cost-of-living crisis driven by the highest inflation since the 1980s.

“You just adapt,” said Freeman, 69, who was using the center as a warm, quiet place to work on a poem. “Little things, like putting less water in the kettle. I was brought up with ‘save the pennies, and the pounds will look after themselves.’ I always cook from scratch and eat what’s in season.

“But it’s nice to go somewhere warm,” she added.

A perfect storm of Russia’s war in Ukraine, lingering pandemic disruption and economic aftershocks of Brexit is putting more people in Britain under financial strain. Households and businesses were hit especially hard after Russia’s invasion of Ukraine drove up the cost of natural gas needed for heating and helped push the U.K. to the precipice of a recession.

The U.K.’s annual inflation rate was just above 10% in January, with food prices up almost 17% over the year. Some 62% of adults are using less natural gas or electricity to save money, according to the Office for National Statistics. A quarter of households regularly run out of money for essentials, pollster Survation found.

Though oil and natural gas prices have fallen from last year’s peaks, the average British household energy bill is still double what it was a year ago. Costs for many are due to rise by another 20% on April 1 when a government-set price cap goes up.

Anne Bolger, a retired math teacher, happened across the warm hub during a walk one day and has come back every week since. She drops in to check emails, prep for math tutoring or do a jigsaw puzzle.

“Today’s the day that I’m appreciating it, because home is freezing,” she said.

The hub runs one afternoon a week in the smallest of the RSC’s three theaters. On Tuesday, the space held a mixture of theater staff, actors on the way to rehearsals and visitors looking to get warm. Organizers provide puzzles, games, toys for children, free tea, coffee and Wi-Fi — even a sewing table.

“I like the fact that it’s such a creative space,” said Bolger, 66. “People are having meetings there, they’re talking, they’re working. I just feel a bit more alive than sitting at home, a bit more connected.”

That’s just what organizers want to hear. They say warm hubs exist to ease loneliness as well as energy poverty.

“The warmth is in the welcome as much as a warm building to come to,” said Nicola Salmon, who oversees the hub as the RSC’s creative place-making manager. “There is always somebody here to chat to.”

Stratford, about 100 miles (160 kilometers) northwest of London, is a prosperous town that makes a good living from William Shakespeare, its most famous son. Even on a wintry weekday, tourists traipse though streets of half-timbered Tudor buildings to see the house where the Bard was born, visit the schoolroom where he studied and stand over his grave in the medieval Holy Trinity Church.

The RSC is one of Stratford’s main cultural attractions and major employers. Salmon says the warm hub is part of the company’s efforts to get closer to its surrounding community, a town that “is often perceived as affluent and well-off” but contains “areas of great deprivation.”

Like Britain’s food banks — now numbering an estimated 2,500 — warm hubs are a crisis measure showing signs of becoming permanent.

The Warwickshire Rural Community Council, a charity covering the county around Stratford, set up a mobile warm hub — a minibus-turned-pop-up outdoor café — in 2021 as pandemic restrictions plunged many rural residents into isolation.

A year ago, the charity ran five hubs across the county, with backing from Cadent, the private company that distributes much of Britain’s heating gas. As winter hit and energy bills soared, the number mushroomed to 90, providing everything from meals to repair workshops and slow-cooking courses meant to reduce gas use.

About 30 of the hubs will stay open this summer — with a view to becoming permanent — and the mobile hub will be on the road five days a week.

“People say we shouldn’t be in this situation, and we shouldn’t be,” said Jackie Holcroft, the charity’s warm hubs manager. “But we are. And I think one of the most amazing things is that you’ve got hundreds, thousands of volunteers around Warwickshire and they’re all coming together to make a difference.”

The RSC’s warm space will close at the end of March, but the company is already planning for its return next year.

“I’ll miss it like crazy,” said Bolger, one of the regulars. “I’m not hoping that the fuel crisis goes on forever, but I am hoping this place will stay open.”
…

Pakistan’s economic crisis is hitting the health sector hard. Pakistan relies heavily on imports such as raw material needed to manufacture medicines and complex surgical equipment. The medical supply chain is coming under increased pressure due to the country’s low foreign exchange reserves and declining rupee. Sarah Zaman reports from Islamabad. Camera and edit: Wajid Asad, Waqar Ahmad
…

Pakistan’s currency fell 7% against the U.S. dollar Thursday as the government struggles to persuade the International Monetary Fund to resume lending to the cash-strapped country to help avert a default on its foreign debt.

The Pakistani rupee has weakened to a record low in recent weeks after foreign exchange companies were allowed in January to remove a cap on the exchange rate. The currency’s official value closed at 285.09 rupees against the dollar Thursday versus 266.11 the previous day.

The market-determined currency exchange rate is a key IMF demand for Prime Minister Shehbaz Sharif’s government to complete before the lender’s board approves a funding tranche of more than $1 billion to Pakistan. 

Islamabad has since failed to secure the tranche, which was initially expected to be disbursed in December as part of a stalled $6.5 billion IMF bailout program, over a lack of progress on fiscal consolidation.

“A delay in IMF funding is creating uncertainty in the currency market,” said Mohammed Sohail of Topline Securities, a Karachi-based brokerage house.

The IMF program is key to unlocking other external bilateral and multilateral financing sources for Pakistan. The drawn-out negotiations between the two sides are putting pressure on government finances and the country’s more than 220 million population.  

Pakistan’s foreign exchange reserves have dwindled to precarious levels and stood at just over $3 billion, hardly enough for three weeks of imports.

Inflation has also skyrocketed to 31.5%, according to official data published Wednesday. Food and fuel prices have soared beyond the means of many Pakistanis.

Decades of financial mismanagement, corruption, and political instability are blamed for pushing Pakistan’s economy to the brink of default. A global energy crisis and last year’s devastating floods across the country have worsened the crisis. 

The Sharif administration has already taken most other actions to keep the talks with the IMF on track. They include a hike in fuel and energy tariffs, the withdrawal of subsidies in export and power sectors and generating more revenue through new taxation in a supplementary budget.

Analysts anticipated the fiscal adjustments would likely further fuel inflation in Pakistan whether or not a deal with the IMF has been reached. 

Pakistani Finance Minister Ishaq Dar rejected reports as “malicious rumors” that the country was on the verge of a default.

“This is not only completely false but also belie the facts. SBP forex reserves have been increasing and are almost U.S. $1 billion higher than four weeks ago, despite making all external due payments on time,” Dar tweeted Thursday.

“Our negotiations with IMF are about to conclude and we expect to sign staff level agreement with IMF by next week. All economic indicators are slowly moving in the right direction,” Dar asserted. He added that foreign commercial banks had started extending facilities to Pakistan.

China, a longtime ally of Pakistan, is the only country that has helped Islamabad get a $700 million loan facility from the China Development Bank last month.

IMF Managing Director Kristalina Georgieva, while speaking at last month’s Munich Security Conference, urged Pakistan to collect more taxes from the wealthy and spend the money on the poor.

“Why should rich people benefit from subsidies when the country faces such a difficult task? Why should rich people and businesses not pay their taxes when the country has such tremendous challenges?” she asked while responding to a question about the delay in reaching a deal with Pakistan.

“In my view what is at stake is fairness in society and we will stand for this fairness, of course, very much hoping that we can get to a good point in moving the policy in Pakistan in the right direction,” Georgieva said. 

Pakistan has long been under fire for not imposing taxes on the wealthy in a country where less than 2% pay income taxes. The rest evade it either in collusion with tax authorities or by exploiting loopholes in the legal system, say financial experts. 

The World Food Program, in its latest assessment, has warned the ongoing economic crisis in Pakistan is “progressively deteriorating, with a depreciated currency, increased food and fuel prices and uncertainty over resuming a $6.5 billion funding package with the IMF.”

The statement added that flood-affected people “are resorting to negative coping strategies that include the sale of income-producing assets, taking on additional debt, withdrawing children from school, and skipping meals.”

Some information for this report came from Reuters.
…

Big Tech shed tens of thousands of jobs over the past several months as giants Google, Amazon, Meta and Microsoft have reduced their workforces. But while white-collar jobs are cut, some blue-collar jobs are difficult to fill despite the rising wages in that sector of the economy. Keith Kocinski has more.
Camera: Keith Kocinski, Rendy Wicaksana
…

In a possible sign that the so-called “decoupling” of the U.S. and Chinese economies is continuing, a recent media report said that the Chinese government has urged large state-owned enterprises (SOEs) to cease using the world’s biggest global accounting firms to audit their onshore businesses.

The report, published last week by Bloomberg, cites people familiar with communications between the Chinese Ministry of Finance and large SOEs, in which the ministry encouraged the companies to allow their existing contracts with Western firms to lapse when they expire, and to replace them with accounting firms from mainland China or Hong Kong.

According to the report, the Chinese government’s focus is on the so-called “Big Four” accounting firms, PricewaterhouseCoopers (PwC), Ernst & Young, KPMG and Deloitte. All four firms have headquarters in London but are instrumental in helping many global companies comply with the audit requirements U.S. authorities require of public firms with shares listed on U.S. stock exchanges.

There has long been tension between the Chinese government, which highly values the security of information held by its large companies, and Western financial services regulators, who prize the kind of transparency that allows investors to make informed decisions about companies seeking to raise money in the capital markets.

Chinese authorities have, for years, been trying to strike a balance between the protection of Chinese firms’ information and the access to international investment capital that comes with exposure on stock markets like those in the U.S.

China disputes report

The Chinese government, through the state-controlled publication the Global Times, has disputed the Bloomberg report. A recent news story in the Global Times said that Big Four firms “have won bids to provide accounting services to China’s state-owned enterprises in recent days.”

The Global Times cited a decision in February by state-run insurance firm China Taiping to hire PwC to provide its audits from 2023-2027, and another recent decision by Liaoshen Bank, closely connected to the state-owned Liaoning Financial Holding Group, to hire KPMG. Neither report could be independently verified.

The Global Times article, published under a “GT Staff reporters” byline, did not quote any government officials by name.

A request for comment emailed by VOA to the Chinese Embassy in Washington was not answered in time for publication.

An uneven pattern

In recent years, Beijing has taken a number of measures to curtail the outside world’s access to information about Chinese companies.

Last year, citing concerns about potential privacy violations, the Chinese Communist Party forced several firms to give up their listings on U.S.-based stock exchanges, and blocked the efforts of others to list in the U.S.

At the same time, the Communist Party has, at times, seemed willing to cooperate with Western regulators. Last year, Beijing struck a deal that provided U.S. regulators with data on Chinese firms, eliminating the possibility that several would have been forced off of U.S. stock exchanges.

Report comes amid tension

The Bloomberg report was published at a low point in relations between the U.S. and China. Early this month, the U.S. shot down a suspected Chinese spy balloon after it traversed most of the continental U.S. The presence of the balloon led Secretary of State Antony Blinken to cancel a trip to China that was seen as the beginning of an effort to restore dialogue.

Since then, U.S. and Chinese officials have had conversations at international gatherings, but those interactions were marked by U.S. warnings that China should avoid providing arms to Russia to support its invasion of Ukraine or risk serious consequences.

The House of Representatives Select Committee on the Chinese Communist Party was scheduled on Tuesday evening to hold a prime-time hearing entitled “The Chinese Communist Party’s Threat to America.” The hearing is expected to be the first in a long series of high-profile public forums in which members of Congress dig into perceived threats from China.

Data security concerns

Also on Tuesday, media reports revealed that the White House Office of Management and Budget had given all federal agencies 30 days to ensure that the Chinese social media app TikTok is removed from all electronic devices owned by the federal government.

As minor as it might seem on its face, the TikTok ban is actually a mirror image of some of the concerns driving China’s suspicion of Western auditing firms. The concern on the part of the White House is that ByteDance, the firm that owns TikTok, is collecting personal information about the app’s users, and making it available to the Chinese government.

U.S. officials frequently point to a Chinese law that obligates companies to assist state intelligence services in their investigations.

Experts dubious

Some experts told VOA they were not convinced of the validity of the Chinese government’s fears about data security, especially because Western accounting firms are legally bound to protect the privacy of client data that is not part of publicly released reports.

“It’s an excuse. No other government or country has this problem,” said James Lewis, director of the Strategic Technologies Program at the Center for Strategic and International Studies in Washington. “Beijing is paranoid about controlling the economic narrative and worries that the audits might give access to information about the problems of the SOEs that they regard as sensitive.”

Lewis added in an interview, “This is another part of China’s decision to separate itself from the global market and force other countries to accept China’s rules.”

Impact on business may be small

Derek Scissors, a senior fellow at the American Enterprise Institute, told VOA that if the Bloomberg report is correct, and the Chinese government’s request went to state-owned enterprises only, the impact on foreign investment in Chinese firms might not be significant.

“Most foreign investment does not involve state-owned enterprises,” Scissors said. “If this is the only step taken, it will not have a big effect. If other firms are urged to drop foreign auditors, that could frighten investors.”

Scissors also said that the request would not necessarily cut off Chinese state firms from overseas listings.

“They can use foreign auditors just for [initial public offerings] if they ever want to list units overseas,” he said.

Rong Shi of VOA’s Mandarin Service contributed to this report.
…

A majority of the nation’s business economists expect a U.S. recession to begin later this year than they had previously forecast, after a series of reports have pointed to a surprisingly resilient economy despite steadily higher interest rates.

Fifty-eight percent of 48 economists who responded to a survey by the National Association for Business Economics envision a recession sometime this year, the same proportion who said so in the NABE’s survey in December. But only a quarter think a recession will have begun by the end of March, only half the proportion who had thought so in December.

The findings, reflecting a survey of economists from businesses, trade associations and academia, were released Monday.

A third of the economists who responded to the survey now expect a recession to begin in the April-June quarter. One-fifth think it will start in the July-September quarter.

The delay in the economists’ expectations of when a downturn will begin follows a series of government reports that have pointed to a still-robust economy even after the Federal Reserve has raised interest rates eight times in a strenuous effort to slow growth and curb high inflation.

In January, employers added more than a half-million jobs, and the unemployment rate reached 3.4%, the lowest level since 1969.

And sales at retail stores and restaurants jumped 3% in January, the sharpest monthly gain in nearly two years. That suggested that consumers as a whole, who drive most of the economy’s growth, still feel financially healthy and willing to spend.

At the same time, several government releases also showed that inflation shot back up in January after weakening for several months, fanning fears that the Fed will raise its benchmark rate even higher than was previously expected. When the Fed lifts its key rate, it typically leads to more expensive mortgages, auto loans and credit card borrowing. Interest rates on business loans also rise.

Tighter credit can then weaken the economy and even cause a recession. Economic research released Friday found that the Fed has never managed to reduce inflation from the high levels it has recently reached without causing a recession.
…

Twitter Inc has laid off at least 200 employees, or about 10% of its workforce, the New York Times reported late on Sunday, in its latest round of job cuts since Elon Musk took over the micro-blogging site last October. 

The layoffs on Saturday night impacted product managers, data scientists and engineers who worked on machine learning and site reliability, which helps keep Twitter’s various features online, the NYT report said, citing people familiar with the matter. 

Twitter did not immediately respond to a Reuters request for comment. 

The company has a headcount of about 2,300 active employees, according to Musk last month. 

The latest job cuts follow a mass layoff in early November, when Twitter laid off about 3,700 employees in a cost-cutting measure by Musk, who had acquired the company for $44 billion. 

Musk said in November that the service was experiencing a “massive drop in revenue” as advertisers pulled spending amid concerns about content moderation. 

Twitter recently started sharing revenue from advertisements with some of its content creators. 

Earlier in the day, The Information reported that the social media platform laid off dozens of employees on Saturday, aiming to offset a plunge in revenue. 
…

In its latest ambitious roadmap to tackle climate change, California relies on capturing carbon out of the air and storing it deep underground on a scale that’s not yet been seen in the United States.

The plan — advanced by Democratic Gov. Gavin Newsom’s administration — comes just as the Biden administration has boosted incentives for carbon capture projects to spur more development nationwide. Ratcheting up 20 years of climate efforts, Newsom last year signed a law requiring California to remove as much carbon from the air as it emits by 2045 — one of the world’s fastest timelines for achieving so-called carbon neutrality. He directed the powerful California Air Resources Board to drastically reduce the use of fossil fuels and build massive amounts of carbon dioxide capture and storage.

To achieve its climate goals, California must rapidly transform an economy that’s larger than most nations’, but opposition to carbon capture from environmental groups and concerns about how to safely transport the gas may delay progress — practical and political obstacles the Democratic-led Legislature must now navigate.

Last year, the California state legislature passed a law that says no carbon dioxide may flow through new pipelines until the federal government finishes writing stronger safety regulations, a process that could take years. As a potential backup, the law directed the California Natural Resources Agency to write its own pipeline standards for lawmakers to consider, a report now more than three weeks overdue.

While there are other ways to transport carbon dioxide gas besides pipelines, such as trucks or ships, pipelines are considered key to making carbon capture happen at the level California envisions. Newsom said the state must capture 100 million metric tons of carbon each year by 2045 — about a quarter of what the state now emits annually.

“We do not expect to see (carbon capture and storage) happen at a large scale unless we are able to address that pipeline issue,” said Rajinder Sahota, deputy executive officer for climate change and research at the air board.

State Sen. Anna Caballero, who authored the carbon capture legislation, said the state’s goal will be to create a safety framework that’s even more robust than what the federal government will develop.

Last year’s Inflation Reduction Act increased federal funding for carbon capture, boosting payouts from $50 to $85 per ton for capturing carbon dioxide from industrial plants and storing it underground.

Without clarity on the state’s pipeline plans, the state is putting itself at a “competitive disadvantage” when it comes to attracting projects, said Sam Brown, a former attorney at the Environmental Protection Agency and partner at law firm Hunton Andrews Kurth.

The geology for storing carbon dioxide gas is rare, but California has it in parts of the Central Valley, a vast expanse of agricultural land running down the center of the state.

Oil and gas company California Resources Corp. is developing a project there to create hydrogen. It plans to capture carbon from that hydrogen facility and the natural gas plant that powers it. The carbon dioxide would then be stored in an old oil field. That doesn’t require special pipeline approval because it’s all happening within the company’s property.

But the company also wants to store emissions from other industries like manufacturing and transportation. Transporting that would rely on pipelines that can’t be built yet.

“These are parts of the economy that have to be decarbonized,” said Chris Gould, the company’s executive vice president and chief sustainability officer. “It makes economic sense to do it.”

Safety concerns increased in 2020 after a pipeline in Mississippi ruptured in a landslide, releasing a heavier-than-air plume of carbon dioxide that displaced oxygen near the ground. Forty-five people were treated at a hospital, and several lost consciousness. There are thousands of miles of carbon dioxide pipelines operating across the country and industry proponents call the event an anomaly. But the Mississippi rupture prompted federal regulators to explore tightening the existing rules for carbon pipelines.

Lupe Martinez, who lives in California’s Kern County, worries about what will happen as developers target the region for carbon storage.

He used to spray fields with pesticides without protective equipment. On windy days, he’d be soaked in chemicals. Martinez, who watched some of his fellow workers later fight cancer, says he was lied to about safety then and doesn’t believe promises that carbon capture is safe now.

“They treat us like guinea pigs,” said Martinez, a longtime labor activist.

The oil and gas industry’s emissions are a main cause of climate change and in the past the industry undermined sound evidence that greenhouse gases are deeply disturbing the climate. Now carbon capture — unproven as a major climate solution — will help the industry keep polluting places that are already heavily polluted, environmentalists argue. Instead of shutting down fossil fuel plants, carbon capture will increase their profits and extend their life, said Catherine Garoupa, executive director of the Central Valley Air Quality Coalition.

But advocates of carbon capture say it’s essential for Kern County oil and gas companies to find new ways to make money and keep people employed as California moves away from fossil fuels, an industry that is the “very fabric” of the region’s identity, said Lorelei Oviatt, director of Kern County Planning and Natural Resources.

Without a new revenue source like carbon capture, “Kern County will be the next Gary, Indiana,” she said, referring to the rust belt’s years-ago collapse.

There are currently no active carbon capture projects in California. To demonstrate the technology is viable and people can get permits for it, it’s essential to build the first projects, said George Peridas, director of carbon management partnerships at Lawrence Livermore National Laboratories.

Peridas said one area with potential to store carbon dioxide is the Sacramento-San Joaquin River Delta, a vast estuary on the western edge of the Central Valley that’s a vital source of drinking water and an ecologically sensitive home to hundreds of species.
…

Mexico is undergoing a fevered competition among states to win a potential Tesla facility in jostling reminiscent of what happens among U.S. cities and states vying to win investments from tech companies.

Mexican governors have gone to extremes, like putting up billboards, creating special car lanes or creating mock-ups of Tesla ads for their states.

And there’s no guarantee Tesla will build a full-fledged factory. Nothing is announced, and the frenzy is based mainly on Mexican officials saying Tesla boss Elon Musk will have a phone call with Mexican President Andrés Manuel López Obrador.

The northern industrial state of Nuevo Leon seemed to have an early edge in the race.

It painted the Tesla logo on a lane at the Laredo-Colombia border crossing into Texas last summer and is erecting billboards in December in the state capital, Monterrey, that read “Welcome Tesla.”

The state governor’s influencer wife, Mariana Rodriguez, was even shown in leaked photos at a get-together with Musk.

However, López Obrador appeared to exclude the semi-desert state from consideration Monday, arguing he wouldn’t allow the typically high water use of factories to risk prompting shortages there.

That set off a competitive scramble among other Mexican states. The governors’ offers ranged from crafty proposals to near-comic ones.

“Veracruz is the only state with an excess of gas,” quipped Gov. Cuitláhuac García of the Gulf Coast state, before quickly adding “gas … for industrial use, for industrial use!”

A latecomer to the race, García had to try harder: He noted Veracruz was home to Mexico’s only nuclear power plant. And he claimed Veracruz had 30% of Mexico’s water, though the National Water Commission puts the state’s share at around 11%.

The governor of the western state of Michoacan wasn’t going to be left out. Gov. Alfredo Ramírez Bedolla quickly posted a mocked-up ad for a Tesla car standing next to a huge, car-sized avocado — Michoacan’s most recognizable product — with the slogan “Michoacan — The Best Choice for Tesla.”

“We have enough water,” Ramírez Bedolla said in a television interview he did between a round of meetings with auto industry figures and international business representatives.

Michoacan also has an intractable problem of drug cartel violence. But similar violence in neighboring Guanajuato state hasn’t stopped seven major international automakers from setting up plants there.

Nuevo Leon Gov. Samuel García had to think fast to avoid being shut out entirely.

García reached out to the western state of Jalisco, whose governor, Enrique Alfaro, belongs to the same small Citizen’s Movement party. Together, the two came up with an alliance Thursday that would allow trucks from Jalisco preferential use of Nuevo Leon’s border crossing, the same one where a “Tesla” lane appeared last year.

Jalisco has a healthy foreign tech sector, but most importantly, it has more water than Nuevo Leon.

López Obrador’s focus on water might be more about politics than about droughts, said Gabriela Siller, chief economist at Nuevo Leon-based Banco Base. She said the president appeared to be trying to steer Tesla investment to a state governed by his own Morena party, like Michoacan or Veracruz.

That could be a dangerous game, Siller said.

“Tesla could say it’s not somebody’s toy to be moved around anywhere, and it could decide not to come to Mexico,” she said.

There are doubts that whatever Musk eventually does announce will be an auto assembly plant. Foreign Relations Secretary Marcelo Ebrard said his understanding is that it won’t be a plant, but rather an ecosystem of suppliers.

Musk at times has floated the idea of building a $25,000 electric vehicle that would cost about $20,000 less than the current Model 3, now Tesla’s least-expensive car. Many automakers build lower-cost models in Mexico to save on labor costs and protect profit margins.

A Tesla investment could be part of “near shoring” by U.S. companies that once manufactured in China but now are leery of logistical and political problems there. That those companies will now turn to Mexico represents the Latin American country’s biggest foreign investment hope.

“The fight among states to attract investments from this nearshoring phenomenon is going to be tough, complicated,” Michoacan’s Ramírez Bedolla said.

As Ramírez Bedolla put it, “wherever Tesla sets up, it is going to be big news in Mexico.”
…

Pakistan has to unwillingly accept the strict conditions of a deal with the International Monetary Fund (IMF) to provide a lifeline for an economy in turmoil, Prime Minister Shehbaz Sharif said Friday.

Sharif was speaking to top security officials at his office in Islamabad in a meeting that was telecast live.

“We have to accept unwillingly the strict conditions for the IMF deal,” he said, adding that an accord was still a “week, 10 days” away.

Pakistani authorities have been negotiating with the IMF since early February over policy framework issues and are hoping to sign a staff-level agreement that will pave the way for more inflows from other bilateral and multilateral lenders.

Once the deal is signed, the lender will disburse a tranche of more than $1 billion from the $6.5 billion bailout agreed to in 2019.

Pakistan has already taken a string of measures, including adopting a market-based exchange rate; a hike in fuel and power tariffs; the withdrawal of subsidies, and more taxation to generate revenue to bridge the fiscal deficit.

Officials say the lender is still negotiating with Islamabad over power sector debt, as well as a potential increase in the policy rate, which stands at 17%.

The strict measures are likely to further cool the economy and stoke inflation, which was 27.50% in January.

The South Asian country’s economy has been in turmoil and desperately needs external financing, with its foreign exchange reserves dipping to about $3 billion, barely enough for three weeks’ worth of imports.

A “friendly country” is also waiting for the deal to be confirmed before extending support to Pakistan, Sharif said without elaborating.

Longtime ally China this week announced refinancing of $700 million, according to Pakistan’s Finance Ministry.

Finance Minister Ishaq Dar on Friday said Pakistan’s central bank has received the money.

“Thank God,” he said in a tweet.
…

Russia’s invasion of Ukraine nearly a year ago has profoundly affected how the world powers itself.
…

The extensive sanctions imposed on Russia after its invasion of Ukraine one year ago have not led to the decimation of the Russian economy, as many experts had predicted. As recently as last fall, according to new polling data, many Russians actually believed they were better off economically than they had been before the war started.

According to data gathered by the Gallup organization, the share of Russians reporting they were satisfied with their standard of living increased by 15 percentage points, to 57% in 2022. For the first time in the poll’s history, satisfaction with living standards was above 50% in every region of the country.

The number of Russians reporting that their economic conditions were improving grew to 44% from 40%, while the number who said their economic prospects were declining plummeted to 29% from 50%.

Similarly, the percentage of Russians reporting that they were satisfied with the country’s leadership surged to 66%, up from 50% in 2021, while the share reporting that they were dissatisfied fell from just under half to only 21%.

The survey is part of Gallup’s expansive annual World Poll, which conducts large-scale polling in dozens of countries around the world every year. The poll of Russian citizens was taken between mid-August and early November of last year, and therefore cannot have captured any changes in attitudes since the fall. The survey involved in-person interviews with a random sample of 2,000 individuals ages 15 or older, living in Russia. The margin of sampling error is plus or minus 2.6 percentage points.

Surprising resilience

Recent data has demonstrated that the impact of international sanctions on Russia was not nearly as dramatic as the 10% contraction that many economists were foreseeing in 2022. The Russian economy contracted by a relatively mild 2.1% in 2022, and the International Monetary Fund has predicted that it will post small, but positive growth of 0.3% in 2023.

Russia began the war with a financial system braced for sanctions. The Russian central bank used currency controls and sharp interest rate hikes to stabilize the ruble early in the first year of the war. At the same time, Russian businesses began exploring deeper ties with countries such as China, India and Turkey, which allowed trade in goods and commodities to largely recover from initial dips at the outset of the conflict.

The biggest reason for Russia’s surprising resilience, however, was that it was allowed to continue selling petroleum products, far and away its largest source of pre-war revenue, on global markets. Prices were elevated at the outset of the fighting, and a slow move by many Western nations away from Russian oil and gas gave Russian firms time to broaden their sales to countries such as India and China.

In an address to the nation this week, Russian President Vladimir Putin touted the country’s economic performance.

“The Russian economy and system of governance proved to be much stronger than the West supposed,” he said. “Their calculation did not come to pass.”

‘Rally’ effect

Benedict Vigers, a consultant with Gallup, told VOA that the better-than-expected performance of the Russian economy may explain some of the economic optimism. However, a strong “rally-round-the-flag” effect is probably also in place.

When two countries go to war, there is a tendency for the people in both countries to demonstrate stronger affection for and satisfaction with their respective homelands, Vigers said.

“It is a well-known effect in Russia,” he said. “We have seen it historically, and it is happening now, in conjunction, to some degree, with Russia’s broader ability to evade some of the worst impacts of Western sanctions.”

He pointed out a similar spike in Russians reporting optimism about the economy and satisfaction with their government in the wake of the invasion of Ukraine’s Crimean Peninsula in 2014.

Repression of dissent

Another factor potentially coloring the responses to the Gallup survey is the fact that the Russian government aggressively punishes public criticism of the government, and has done so with more frequency in the months since launching its invasion of Ukraine. Tens of thousands of Russian citizens have been arrested for protesting against the war.

Galina Zapryanova, Gallup’s regional director for Eastern Europe and the former Soviet Union, told VOA in an email that the company cannot rule out the possibility that fear of reprisal affects peoples’ answers to poll questions.

“It is certainly possible that some people would not give a truly honest answer on questions related to approval of government policies, etc. — they may give the ‘safest’ answer that they consider most appropriate,” she wrote.

“This is a risk in all survey research in countries that are not entirely free, but we need to try our best to obtain representative data, while keeping in mind that a portion of any trend could be due to self-censorship by respondents.”

However, she noted that on the question of how Russians feel about the future of the economy, 56% opted for a response other than the seemingly “safe” option of declaring themselves optimistic.

Economic data suppressed

Another potentially complicating factor is that since the invasion in February 2022, the Kremlin has significantly closed off access to economic data that used to be public information.

“As far as mass media is concerned, economic information just recently fell victim to censorship,” Vasily Gatov, a senior fellow at the University of Southern California Center on Communication Leadership and Policy, told VOA. “Until spring last year, the Kremlin literally didn’t control narratives and the way people were writing about the economy in general.”

Gatov, who studies Russian media, said that since then, the government has blocked access to many reports on economic activity, making it more difficult for journalists and academics to get a full picture of what is happening with the Russian economy.

However, Gatov said, while it may be possible for the Kremlin to control access to some information, much of people’s perception about the economy comes from their own lived experiences.

“People receive economic information from various sources, and not always media sources,” he said. “One of them is their bank account. Another is prices at the gas station or grocery store.”

Without addressing the Gallup findings specifically, Gatov said that in his view, Russians “read between the lines” of information coming from the Kremlin and Kremlin-controlled media sources.

He said that they see major international brands refusing to do business in their country and are experiencing infrequent but serious shortages such as an ongoing lack of Western-produced drugs like insulin. “Russians are skeptical about the economic future of the country.”
…

Moscow’s invasion of Ukraine a year ago has had profound impacts on how the world powers itself. VOA’s Steve Baragona explains.
…

The United States is nominating former Mastercard CEO Ajay Banga to lead the World Bank, President Joe Biden announced on Thursday, crediting him with critical experience on global challenges including climate change.

The news comes days after Trump appointee David Malpass announced plans to step down in June from his role leading the 189-nation poverty reduction agency. His five-year term was due to expire in April 2024.

Addressing the impacts of climate change at the multilateral bank is a priority for the U.S. And leading climate figures have urged the Biden administration to use Malpass’ early departure as an opening to overhaul the powerful financial institution, which has been increasingly criticized as hostile to less-wealthy nations and efforts to address climate change.

Malpass ran into criticism last year for seeming, in comments at a conference, to cast doubt on the science that says the burning of fossil fuels causes global warming. He later apologized and said he had misspoken, noting that the bank routinely relies on climate science.

Banga, currently vice chairman at private equity firm General Atlantic, has more than 30 years of business experience, having served in various roles at Mastercard and the boards of the American Red Cross, Kraft Foods and Dow Inc. He is the first Indian-born nominee to the World Bank president role.

“Ajay is uniquely equipped to lead the World Bank at this critical moment in history,” Biden said in a statement, adding that Banga “has critical experience mobilizing public-private resources to tackle the most urgent challenges of our time, including climate change.”

Treasury Secretary Janet Yellen said in a statement that Banga’s experience “will help him achieve the World Bank’s objectives of eliminating extreme poverty and expanding shared prosperity while pursuing the changes needed to effectively evolve the institution,” which include meeting “ambitious goals for climate adaptation and emissions reduction.”

Biden’s climate envoy, John Kerry, said on Twitter that Banga was “the right choice.”

“He can help put in place new policies that help deploy the large sums of money necessary to reduce global emissions and help developing and vulnerable countries adapt, build resilience, and mitigate the impact of greenhouse gases,” Kerry tweeted.

The United States has traditionally picked the World Bank chief. The head of its sister agency, the International Monetary Fund, has traditionally come from Europe. But critics have called for an end to that arrangement and for developing countries to gain a bigger voice in the two organizations.

The World Bank has promised to conduct “an open, merit-based and transparent selection process″ and said it would accept nominations through March 29.

Eric LeCompte, executive director of the anti-poverty coalition Jubilee USA Network, said the United States was “looking to nominate people that will be supported by the developing world” and that it was “incredibly relevant” that Banga was born in India. “They want to be able to appoint people who have experience and roots with other economies,” LeCompte said.

“I can’t think of a more intense time for a person to be coming into this job,” said Clemence Landers, policy fellow at the Center for Global Development, a Washington think tank.

The bank is under pressure to expand its mandate — an effort that likely would require the next president to convince donor countries to provide more money.

Critics say the bank should be doing more to help poor countries finance projects to combat and prepare for climate change without saddling them with heavy debt burdens. And Landers said it needs to do a better job at tackling problems that cross borders such as providing pandemic surveillance and backing broad vaccination programs.
…

Russia’s invasion of Ukraine a year ago saw a dramatic rise in the price of fertilizer for importers like Ghana, where farmers are struggling to cope.  Ghana’s economic problems have made imports even more expensive, forcing farmers to switch to different crops and ultimately, reduce production.  Kent Mensah reports from Akatsi, Ghana.

Camera: Nneka Chile
…

Pakistan Prime Minister Shehbaz Sharif has asked his ministers and advisers to fly economy class, forgo luxury cars and their salaries as part of an austerity drive that will save the government $766 million a year.

The belt tightening comes as Islamabad — which is facing a balance of payment crisis — thrashes out a deal with the International Monetary Fund (IMF) to secure funds worth $1 billion which have been pending since late last year over policy issues.

Pakistan’s foreign exchange reserves have fallen below a three-week import cover and the expenditure cuts announced on Wednesday are part of an effort to stave off an economic meltdown.

“These austerity measures will save us 200 billion rupees annually,” Sharif told a news conference in Islamabad.

“These measures are need of the hour, and these savings no matter if that’s one penny is very significant,” he said, terming it a sacrifice for the poor who wouldn’t afford food on the table or medicines in the face of consistently high inflation, which touched 27.5% in January.

Sharif said all federal ministries and government offices have been directed to reduce expenditure by 15% and that he had asked his ministers and advisers to forgo salaries, allowances, luxury cars, foreign trips and business class travel.

The ministers agreed to the measures voluntarily, he said, adding all Cabinet members will surrender their salaries and perks, and they will pay all of their utility bills from their pockets.

Armed forces have given a positive response to cut non-combat expenditures, Sharif said without elaborating.

Other steps include a complete ban on the purchase of luxury items or vehicles for all government-run entities and no administrative unit like a new district or town will be created for two years.

All luxury vehicles will be withdrawn from the ministers, advisers and bureaucrats, who would travel abroad only if inevitable and that too in economy class.

The South Asian nation hopes to secure funds from the IMF soon, Sharif said, adding the stringent measures were part of the requirements the lender had asked Pakistan to fulfill before finalizing a deal.

Talks between Pakistan and the IMF are due to conclude this week, officials say.

Before the talks the IMF had asked Pakistan to take a host of prior actions, which included withdrawal of subsidies, hiking energy tariffs, raising extra revenues and arranging external financing.
…