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May 19th, 2022 by Vbiz

Stocks closed sharply lower Wednesday on Wall Street as dismal results from Target renewed fears that inflation is battering U.S. companies.

The S&P 500, the benchmark for many index funds, fell 4%.

Target lost a quarter of its value, dragging other retailers down with it, after saying its profit fell by half in the latest quarter as costs for freight and transportation spiked. That comes a day after Walmart cited inflation for its own weak results.

The Dow Jones Industrial Average dropped 1,164 points, or 3.6% and the tech-heavy Nasdaq pulled back 4.7%. Treasury yields fell as investors sought safer ground.

“A lot of people are trying to guess the bottom,” said Sam Stovall, chief investment strategist at CFRA. “Bottoms occur when there’s nobody left to sell.”

Retailers were among the biggest decliners after Target plunged following a grim quarterly earnings report.

The weak reports stoked concerns that persistently rising inflation is putting a tighter squeeze on a wide range of businesses and could cut deeper into their profits.

Technology stocks, which led the market rally a day earlier, were the biggest drag on the S&P 500. Apple lost 5.9%.

All told, more than 95% of stocks in the S&P 500 were down. Utilities also weighed down the index, though not nearly as much as the other 10 sectors, as investors shifted money to investments that are considered less risky.

The disappointing report from Target comes a day after the market cheered an encouraging report from the Commerce Department that showed retail sales rose in April, driven by higher sales of cars, electronics and more spending at restaurants.

Stocks have been struggling to pull out of a slump over the last six weeks as concerns pile up for investors. Trading has been choppy on a daily basis and any data on retailers and consumers is being closely monitored by investors as they try to determine the impact from inflation and whether it will prompt a slowdown in spending. A bigger-than-expected hit to spending could signal more sluggish economic growth ahead.

The Federal Reserve is trying to temper the impact from the highest inflation in four decades by raising interest rates. On Tuesday, Fed Chair Jerome Powell told a Wall Street Journal conference that the U.S. central bank will “have to consider moving more aggressively” if inflation fails to ease after earlier rate hikes.

Investors are concerned that the central bank could cause a recession if it raises rates too high or too quickly. Worries persist about global growth as Russia’s invasion of Ukraine puts even more pressure on prices for oil and food while lockdowns in China to stem COVID-19 cases worsens supply chain problems.

The United Nations is significantly lowering its forecast for global economic growth this year from 4% to 3.1%. The downgrade is broad-based, which includes the world’s largest economies such as the U.S., China and the European Union.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 18th, 2022 by Vbiz

In February, the Nigerian technology startup CrowdForce announced a big break: It had received $3.6 million from investors to expand its financial services operations to many more underserved communities.  

Co-founder and Chief Executive Officer Tomi Ayorinde said new funding will boost its mobile agent network from 7,000 to 21,000 this year.

“We were looking to scale faster and really gain market share,” Ayorinde said. “And what we’re doing is also very impact-related because we’re creating jobs, avenues for people to make extra income in their communities. So, it was also very interesting for impact investors to be part of what we’re trying to do.” 

When Ayorinde helped launch CrowdForce seven years ago, he intended it to be a data collection company. But after about two years, the company overhauled its business model when Ayorinde realized it could fill a need for bank accounts.   

“When we collected data of 4.5 million traders what we saw was, a lot of them didn’t have bank accounts and the ones that have bank accounts had a very tough time accessing the cash that was sent to them,” said Ayorinde.”That’s when we kind of realized that there’s a bigger problem to solve here.”

Experts say about 60% of Africa’s 1.2 billion people lack access to banks or financial services. Technology startups in Africa are trying to fix that, said the African Private Equity and Venture Capital Association known as AVCA.   

In a recent report, the industry group said African startups attracted $5.2 billion in venture capital last year, and that West Africa – led by Nigeria – accounted for the largest share of investments.    

AVCA research manager Alexia Alexandropoulou said investors are looking to tap into Africa’s huge population of young people.    

“Africa is the world’s most youthful population, so as the proportion of skilled labor increases, then the result will be more human capital in order to power African businesses and also the industrial development within the continent,” said Alexandropoulou.

AVCA’s report also cites increased internet penetration in Africa and more favorable government policies as contributing to increased investments in financial technology services knwoFintech.  

But Fintech Digital Marketing Expert Louis Dike said there are obstacles to overcome, such as weak currencies and policies.  

“Africa is not a perfect place because it’s still made up of virgin markets,” said Dike. “The standard of living is quite low, our regulations are not consistent, today the government will say this and tomorrow they will change the law and restrict some startup activities.”  

But with new talents emerging in technology, more startups with big dreams are emerging in Nigeria and elsewhere in Africa. 

 

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 17th, 2022 by Vbiz

U.S. Treasury Secretary Janet Yellen is calling on allies to boost their economic support for Ukraine, saying the support pledged so far will not be enough to meet the country’s basic needs.

In comments prepared for the Brussels Economic Forum, Yellen says while Ukraine will eventually need “massive support,” for now it needs “budget funding to pay soldiers, employees and pensioners, as well as to operate an economy that meets its citizens’ basic needs.”

Yellen adds that Ukraine’s “financing needs are significant,” while crediting the bravery and ingenuity of the country’s officials to keep its economy going.

Help could come Wednesday with the European Union expected to propose a set of loans that would help Ukraine both with short-term financing and its rebuilding effort in the longterm.

Some information came from Reuters.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 17th, 2022 by Vbiz

As cases of coronavirus continue to decline in the United States, many businesses have told their employees it’s time to return to the office.  

Some people are already doing the daily grind, while others are splitting their time between home and the office as part of a hybrid plan.  

The office routine was normal for millions of Americans before the pandemic. Now, some two years later, it is regarded as a new normal, after those employees worked full-time from their residences. 

Morning Consult, a global business intelligence company, has been polling U.S. consumers about returning to the workplace.  

Charlotte Principato, a financial services analyst for the organization, said the latest poll showed 73% of remote workers felt comfortable returning to the office. The remaining 27% wanted to remain at home where, they said, they work more efficiently.  

“The return to the office is experienced differently depending on each person’s situation,” and introverts may have a harder time getting used to it than extroverts, said Debra Kaplan, a therapist in Tucson, Arizona.  

She told VOA many people will experience stress adjusting to an office environment after working from home. 

Mark Gerald, a psychoanalyst in New York, likens it to a child going to school for the first time.  

There’s almost childlike anxiety that’s related to change and fears of going into the world, he said. 

The fears include contracting the coronavirus, as well as being away from family during the workday. 

That’s true for Imani Harris, a federal government employee in Washington who has two young children. 

“I wear a mask at work because I don’t feel safe being at the office,” she said. “I’d rather be at home because I accomplish more, and get to spend quality time with the kids — plus it’s harder financially since I have to spend money on child care.” 

Another drawback is exhaustion.  

“At first, returning to the office can be really draining because you haven’t seen the people you work with in person for a long time,” said Karestan Koenen, a psychiatric epidemiology professor at Harvard University’s School of Public Health. 

“Psychologically and emotionally, the transition is not comfortable but should eventually become more comfortable as time goes on,” she added.  

Still, many workers favor a hybrid approach in which they work more at home than in the office.  

“We tend to see that younger folks are more likely to want a hybrid environment where they feel they’re more productive and have more flexibility and control,” Principato said.  

They also don’t think their jobs need to be done in the office and want to work in a way that feels better for them, Kaplan said.  

For Ethan Carson, who is in his 20s and works for a technology firm in Falls Church, Virginia, going to his office “is more of a bother” than working from home. “I don’t need to be in my building to do my job,” he said, “and the commute is difficult with the horrible traffic.” 

Other employees, however, think it’s easier for them to get their job done around their peers than at home, where there may be more distractions.  

For some, the office makes them feel they are part of a community again.  

“There is a hunger for human connection and sometimes the human touch,” Gerald said.  

“People have realized that socializing is helpful for their mental health,” Kaplan said. “They often feel positive about seeing their colleagues,” talking to them face-to-face, and not just on Zoom, she explained.  

Angela Morgensen, a communications consultant in Bethesda, Maryland, is relieved to be back at the office. 

“I’m enjoying talking to the people I work with and feel more like I’m part of the company again,” she said. “I used to hate meetings, but I’m finding it stimulating to share ideas.” 

Gerald points out that the pandemic has made people think more about a better work-life balance, including how many hours they want to spend in the office. 

“They are not returning as the same person they were before the pandemic happened. Some wonder, ‘Is this job fulfilling and the workplace a good environment for me?'”  

And that’s reflected in seeing hybrid work becoming more of the norm, he said. 

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 16th, 2022 by Vbiz

When he was 20 years old, Harel Hershtik planned and executed a murder, a crime that a quarter of a century later is still widely remembered for its grisly details.

Today, he is the brains behind an Israeli health-tech startup, poised to make millions of dollars with the backing of prominent public figures and deep-pocket investors.

With his company set to go public, Hershtik’s past is coming under new scrutiny, raising questions about whether someone who took a person’s life deserves to rehabilitate his own to such an extent.

“When I was young, I would say that I was stupid and arrogant,” said Hershtik, now 46. “You can be a genius and yet still be very stupid and the two don’t contradict each other.”

Today, Hershtik is the vice president of strategy and technology at Scentech Medical, a company he founded in 2018, while behind bars, which says its product can detect certain diseases through a breath test.

In a three-hour interview with The Associated Press, he repeatedly expressed remorse for his crime.

Hershtik was convicted of murdering Yaakov Sela, a charismatic snake trapper he met when he was 14. The two had a bumpy relationship.

Sela was known for having numerous girlfriends at once, one being Hershtik’s mother. Hershtik said he felt uneasy with how Sela treated some of the women, including his mother.

In early 1996, Sela discovered that Hershtik had stolen 49,000 shekels (about $15,000 at the time) from him, and the two agreed that instead of involving the police, Hershtik would pay him back double that amount. Court documents say Hershtik instead planned to murder Sela.

Pulled over during a drive to gather the money, an accomplice of Hershtik’s fired three shots at Sela, using Hershtik’s mother’s pistol. He then handed Hershtik the gun, according to the documents, and Hershtik shot Sela in the head at close range.

The pair shoved Sela’s body into the trunk and buried it in a grove in the Golan Heights, according to the documents. Weeks later, hikers saw a hand poking up from the earth, and Sela’s body was found.

The sensational crime gripped the nation.

In court documents, prosecutors say Hershtik lied repeatedly in his attempt to distance himself from the murder.

Hershtik said he was compelled to lie so that he could protect the others involved in the scheme, which included his mother.

Hershtik was sentenced to life in prison for premeditated murder and obstructing justice, among other crimes.

He would serve 25 years, during which time Hershtik earned two doctorates, in math and chemistry, and got married three separate times. He said he established 31 companies, selling six of them.

But prison was also a fraught time for Hershtik. He said he spent 11 years in quarantine because of health issues. He was punished twice for setting up internet access to his cell, in one case building a modem out of two dismantled DVD players.

Last year, a parole board determined he had been rehabilitated and no longer posed a danger to society.

As part of his early release and until 2026, he is under nightly house arrest from 11 p.m. to 6 a.m. He must wear a tracking device around his ankle at all times and is barred from leaving the country.

A free man, Hershtik sat recently with the AP in his office in the central city of Rehovot, Israel.

His start-up is waiting for regulatory approval to merge with a company called NextGen Biomed, which trades on the Tel Aviv Stock Exchange and would make Scentech public.

Hershtik said the company’s product is being finalized for detecting COVID-19 through a patient’s breath, and it is working to add other diseases such as certain cancers as well as depression. The product is meant to provide on-the-spot results in a non-invasive way.

The company has received a patent for its technology in Israel and said it is preparing to apply for FDA approval soon.

Hershtik said the merger values the company at around $250 million and that he has raised more than $25 million in funding over the last two years through private Israeli investors. A large part of the investment is from Hershtik’s own money, although he won’t say how much. Prisoners in Israel aren’t barred from doing business, but

Hershtik’s success is rare.

His company is backed by prominent Israeli names, including Yaakov Amidror, who chairs NextGen and is a former chief of the country’s National Security Council.

“According to the rules of the country, the man is allowed to rehabilitate. He paid his price and he rehabilitated. So there is no reason not to help him rehabilitate,” Amidror, who testified to the parole board on Hershtik’s behalf, told the AP.

But Hershtik’s past is already haunting him. Hershtik was demoted from CTO earlier this year to his current position, in part because he didn’t want his crime to scare away investors.

“Harel has always said if for some reason his presence is a problem and the company would be better off without him, that he’s willing to leave the company,” said Drew Morris, a board member and investor.

As Scentech seeks to take its product to market, investors will need to decide whether Hershtik’s rap sheet influences where they put their money.

Ishak Saporta, a senior lecturer at Tel Aviv University’s Coller School of Management, said he believed investors would be drawn to the company’s potential for profit rather than deterred by Hershtik’s history.

“What concerns me here is that he became a millionaire. He paid his debt to society in jail. But does he have a commitment to the victim’s family,” Saporta asked.

Tovia Bat-Leah, who had a child with Sela, suggested he help fund her daughter’s education or create a reptile museum in Sela’s name.

“He served his time but he should also make some kind of reparation,” she said.

Hershtik sees the good that could come about from the company as the ultimate form of repentance. He said he could have used his smarts to create any sort of company with no benefit to society but chose health tech instead.

“Trust me, this is not for the money,” he said.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 16th, 2022 by Vbiz

The European Commission on Monday sharply cut its eurozone growth forecast for 2022 to 2.7 percent, blaming skyrocketing energy prices caused by Russia’s invasion of Ukraine.

The war also spurred the EU’s executive to revisit its eurozone inflation prediction for 2022, with consumer prices forecast to jump by 6.1 percent year-on-year, much higher than the earlier forecast of 3.5 percent.

“There is no doubt that the EU economy is going through a challenging period due to Russia’s war against Ukraine, and we have downgraded our forecast accordingly,” EU executive vice president Valdis Dombrovskis said.

“The overwhelming negative factor is the surge in energy prices, driving inflation to record highs and putting a strain on European businesses and households,” he added.

The EU warned that the course of the war was highly uncertain and that the risk of stagflation -– punishing inflation with little or no growth — remained a real risk going forward.

If Russia, the EU’s main energy supplier, should cut off its oil and gas supply to Europe completely, the commission warned that the forecast would worsen considerably.

“Our forecast is subjected to very high uncertainty and risks,” EU commissioner Paolo Gentiloni told reporters.

“Other scenarios are possible under which growth may be lower and inflation higher than we are projecting today. In any case, our economy is still far from a normal situation,” he said.

For the EU as a whole, including the eight countries that do not use the euro as their currency, the commission had also forecast growth of four percent in February, but has now cut this to 2.7 percent, the same level as for the eurozone.

The sharp reduction in expectations is in line with the forecast made in mid-April by the International Monetary Fund, which predicted 2.8 percent growth for the eurozone this year.

The EU’s warning for the months ahead lands as the European Central Bank is increasingly expected to increase interest rates in July to tackle soaring inflation.

Critics warn that this could put a brake on economic activity just when the economy faced the headwinds from the war in Ukraine.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 16th, 2022 by Vbiz

The United States and the European Union plan to announce on Monday a joint effort aimed at identifying semiconductor supply disruptions as well as countering Russian disinformation, officials said.

The U.S. officials are visiting the French scientific hub of Saclay for a meet up of the Trade and Technology Council, created last year as China increasingly exerts its technology clout.

U.S. officials acknowledged that Russia’s invasion of Ukraine has broadened the council’s scope, but said the Western bloc still has its eye on competition from China.

The two sides will announce an “early warning system” for semiconductors supply disruptions, hoping to avoid excessive competition between Western powers for the vital tech component.

The industry has suffered from a shortage of components for chipmaking, blamed on a boom in global demand for electronic products and pandemic snarled supply chains.

“We hope to agree on high levels of subsidies — that they will not be more than what is necessary and proportionate and appropriate,” Margrethe Vestager, the European Commissioner for Competition, told reporters Sunday.

The aim is that “as both Washington and Brussels look to encourage semiconductor investment in our respective countries, we do so in a coordinated fashion and don’t simply encourage a subsidy race,” a U.S. official said separately, speaking on condition of anonymity.

The United States already put in place its own early warning system in 2021 that looked at supply chains in Southeast Asia and “has been very helpful in helping us get ahead of a couple of potential shutdowns earlier this year,” the US. .official said.

The official added that the two sides are looking ahead to supply disruptions caused by pandemic lockdowns in China — the only major economy still hewing to a zero-Covid strategy.

The European Union and United States will also announce joint measures on fighting disinformation and hacking, especially from Russia, including a guide on cybersecurity best practices for small- and medium-sized companies and a task force on trusted technology suppliers, the official said.

“It’s not a European matter but a global matter,” she said.

U.S. Commerce Secretary Gina Raimondo and U.S. Trade Representative Katherine Tai are visiting for the talks.

Secretary of State Antony Blinken attended an opening dinner on Monday before cutting short his visit to head to Abu Dhabi for the funeral of late leader Sheikh Khalifa.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 15th, 2022 by Vbiz

Senegal President Macky Sall called Sunday for the creation of a pan-African credit ratings agency, saying that the “very arbitrary” nature of the system of assessment by international organizations made it more expensive for African countries to borrow on global debt markets.

Sall, who is currently head of the African Union, told private radio RFM that there was a need — “given the injustices, the sometimes very arbitrary ratings” by international agencies — “to have a pan-African” body.  

His comments came on the eve of the Dakar Economic Conference 2022, organized by African economists. 

“In 2020, when all economies were suffering fallout from the COVID-19 pandemic, 18 of the 32 African economies rated by at least one of the big agencies saw their ratings downgraded,” he said.

That meant that 56% of African countries saw their credit ratings downgraded, compared with 31% of countries globally over the same period, Sall argued.

“Studies show that at least 20% of the ratings criteria for African countries are based on more subjective factors, cultural or linguistic ones for example, which bear no relation to the parameters used for measuring economic stability,” he said. 

As a result, “the perception of investment risk in Africa is always much higher than the real risk. That means our insurance premiums are higher and that makes our credit more expensive.” 

African countries continued to pay much higher interest rates as a result of this unfair system, Sall said.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 15th, 2022 by Vbiz

Egyptian Prime Minister Mostafa Madbouli announced Sunday a string of planned privatizations of state-owned companies, as Cairo grapples with an economic crisis and inflation at almost 15%.

Following years of accusations of state companies crowding out private investments, the government announced a roadmap to more than double the private sector’s share in the economy.

Madbouli laid out plans for 10 state-owned companies and two army-owned companies to be listed on the stock market later this year.

Two new holding companies, to incorporate “the seven largest ports” and “Egypt’s top hotels” will also be formed, percentages of which “will be listed on the stock exchange,” he told reporters.

By 2025, the government hopes to see “private sector contribution in investment grow to 65%,” up from 30% today.

President Abdel Fattah al-Sissi last month announced plans to “double its support to the private sector” in a program aimed to attract $10 billion annually over the next four years.

Earlier this month, American firm S&P Global released its latest Egypt Purchasing Manager’s Index, which showed the state’s non-oil private sector economy contracting for the 17th straight month.

Inflation hit a three-year high of 14.9% in April, a month after the Egyptian pound lost 17% of its value overnight.

The state’s grip on the Egypt’s economy has been criticized as creating unfair competition.

Business magnate Naguib Sawiris last year warned of the effects of an unfair playing field, arguing that “the state has to be a regulator, not an owner” of economic activity.

Madbouli on Sunday said there was “no alternative” to the state’s involvement in the economy, considering the “instability” of recent years, alluding to security concerns surrounding Sissi’s rise to power, and more recently the COVID-19 pandemic.

Since Sissi became president in 2014, the former army general has embarked on massive national infrastructure projects, where the key but opaque role the army has played in Egypt’s economy for decades took center stage.

Although no official figures are published about the army’s financial interests, the new push for privatization of military-owned companies could seek to correct a skewed investment environment.

Since Russia’s invasion of Ukraine in late February sent global commodity prices soaring, Egypt — the world’s largest importer of wheat — has been reeling from mounting economic pressures, pushing the country to apply for a new loan from the International Monetary Fund.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 15th, 2022 by Vbiz

No item is more essential to Mexican dinner tables than the corn tortilla. But the burst of inflation that is engulfing Latin America and the rest of the world means that people like Alicia García, a cleaner at a restaurant in Mexico City, have had to cut back.

Months ago, García, 67, would buy a stack of tortillas weighing several kilograms to take home to her family every day. Now, her salary doesn’t go so far, and she’s limiting herself to just one kilogram (2.2 pounds).

“Everything has gone up here,” she told The Associated Press while standing outside a tortilla shop. “How am I, earning minimum wage, supposed to afford it?”

Just as inflation isn’t limited to tortillas, whose prices in the capital have soared by one-third in the past year, Mexico is hardly alone. Latin America’s sharpest price spike in a generation has left many widely consumed local products suddenly hard to attain. Ordinary people are reckoning with day-to-day life that has become a more painful struggle, without any relief in sight.

Countries had already been absorbing higher prices because of supply chain bottlenecks related to the COVID-19 pandemic and government stimulus programs. Then Russia’s invasion of Ukraine in late February sent fertilizer prices sharply higher, affecting the cost of agricultural products including corn. Global fuel prices jumped, too, making items transported by truck to cities from the countryside costlier.

In Chile, annual inflation was 10.5% in April, the first time in 28 years the index has hit double digits. Colombia’s rate reached 9.2%, its highest level in more than two decades. In Argentina, whose consumers have coped with double-digit inflation for years, price increases reach 58%, the most in three decades.

In beef-crazy Buenos Aires, some households have started seeking alternatives to that staple.

“We never bought pork before; now, we buy it weekly and use it to make stew,” Marcelo Gandulfo, a 56-year-old private security guard, said after leaving a butcher’s shop in the middle-class neighborhood of Almagro. “It’s quite a bit cheaper, so it makes a difference.”

Last year, the average Argentine consumed less than 50 kilograms of beef for the first time since annual data were first collected in 1958, according to the Argentine Beef Promotion Institute. Over the past few months, prices have been “increasing a lot more than normal,” said Daniel Candia, a 36-year-old butcher.

“I’ve been in this business for 16 years, and this is the first time I’ve seen anything like this,” he said.

Latin America as a whole is suffering from “sudden price spikes for necessities,” the World Bank’s President David Malpass said during an online conference Thursday. He noted that energy, food and fertilizer prices are rising at a pace unseen in many years.

Across the world, central banks are raising interest rates to try to slow inflation. Brazil’s central bank has undertaken one of the world’s most aggressive rate-raising cycles as inflation has topped 12% — its fastest pace since 2003. Besides the factors that are stoking regional inflation, Brazil’s agricultural products have become costlier because of drought and frost. The price of tomatoes, for example, has more than doubled in the past year.

Higher rates are a government’s primary tool to fight high inflation. But jacking up rates carries the risk of weakening an economy so much as to cause a recession. Last year, the World Bank estimated that the region’s economy grew 6.9% as it rebounded from the pandemic recession. This year, Malpass said, it’s projected to grow only 2.3%.

“That’s not enough to make progress on poverty reduction or social discontent,” he added.

Brazilian newspapers are telling their readers which foods they can substitute for their usual products to help stretch family budgets further. But some items, like coffee, are irreplaceable — especially in the nation that produces more of it than any other in the world.

Ground coffee has become so expensive that shoplifters have started focusing their sights on it, said Leticia Batista, a cashier at a Sao Paulo supermarket.

“It breaks my heart, but I told many of them to give the powder back,” Batista said in the upscale neighborhood of Pinheiros.

In her own humbler neighborhood, she said, the cost of coffee “is a big problem.”

On the more upscale end of the java spectrum, Marcelo Ferrara, a 57-year-old engineer, used to enjoy a daily espresso at his local bakery. Its cost has shot up 33% since January, to 8 reais ($1.60). So he’s cut his intake to two each week.

“I just can’t afford too many of these,” Ferrara said as he gulped one down.

It has been decades since the region’s countries simultaneously suffered soaring inflation. A key difference now is that the global economies are much more interconnected, said Alberto Ramos, head of Latin America macroeconomic research at Goldman Sachs.

“Interest rates will need to go up; otherwise, inflation will run wild and the problem will get even worse,” Ramos said. “Governments cannot be afraid of using rates. It is a proven medicine to bring inflation down.”

So far, though, higher rates aren’t providing much hope that inflation will decline significantly in the near term. The International Monetary Fund last month projected that average inflation in the region, excluding Venezuela, will slow to 10% by year end. That’s not much below the 11.6% rate registered at end-2021 and still more than twice the 4.4% expected for advanced economies, according to the IMF’s World Economic Outlook.

“It will take at least a couple of years of relatively tight monetary policy to deal with this,” Ramos said.

That means belt-tightening and going without some consumer staples, for now, is likely the new norm for the poorest members of society in the notoriously unequal region. More than one-quarter of Latin America’s population lives in poverty — defined as living on less than $5.50 a day — and that’s expected to remain unchanged this year, according to a World Bank study published last month.

Sara Fragosa, a 63-year-old homemaker in Mexico City, didn’t hide her anger at rising prices during an interview at one market’s stall.

“Those who are the poorest are the worst off, while the rich only rise,” said Fragosa, who said she has replaced her regular beef purchases with quinoa and oats.

“You’re not used to it,” she said, “but you don’t have a choice.”

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 14th, 2022 by Vbiz

India banned wheat exports without government approval Saturday after its hottest March on record hit production, in a blow to countries reeling from supply shortages and soaring prices since Russia’s invasion of Ukraine.

The announcement drew sharp criticism from the Group of Seven industrialized nations’ agriculture ministers meeting in Germany, who said that such measures “would worsen the crisis” of rising commodity prices.

“If everyone starts to impose export restrictions or to close markets, that would worsen the crisis,” German Agriculture Minister Cem Ozdemir said at a press conference in Stuttgart.

Global wheat prices have soared on supply fears following Russia’s February invasion of Ukraine, which previously accounted for 12% of global exports.

The spike in prices, exacerbated by fertilizer shortages and poor harvests, has fueled inflation globally and raised fears of famine and social unrest in poorer countries.

It has also led to concerns about growing protectionism following Indonesia’s halting of palm oil exports and India putting the brakes on exports of wheat.

India, the world’s second-largest wheat producer, said that factors including lower production and sharply higher global prices meant it worried about the food security of its own 1.4 billion people.

Export deals agreed to before the directive issued Friday could still be honored, but future shipments need government approval, it said.

But exports could also take place if New Delhi approved requests from other governments “to meet their food security needs”.

“We don’t want wheat to go in an unregulated manner where it may either get hoarded and is not used for the purpose which we are hoping it will be used for –- which is serving the food requirements of vulnerable nations and vulnerable people,” said BVR Subrahmanyam, India’s commerce secretary.

On Thursday New Delhi said it was sending delegations to Morocco, Tunisia, Thailand, Vietnam, Turkey, Algeria and Lebanon “for exploring possibilities of boosting wheat exports from India”.

It was unclear whether these visits would still take place.

Global help

Possessing major buffer stocks, India previously said it was ready to help fill some of the supply shortages caused by the Ukraine war.

“Our farmers have ensured that not just India but the whole world is taken care of,” Commerce and Industry Minister Piyush Goyal said in April.

India said that it planned to increase wheat exports this financial year, starting April 1, to 10 million tons from seven million tons the year before.

While this is a tiny proportion of worldwide production, the assurances provided some support to global prices and soothed fears of major shortages.

Egypt and Turkey recently approved wheat imports from India.

But India endured its hottest March on record – blamed on climate change – and has been wilting in a heatwave in recent weeks, with temperatures upwards of 45 degrees Celsius.

This has hit farmers hard, and this month the government said that wheat production was expected to fall at least five percent this year from 110 million tons in 2021 — the first fall in six years.

Indian wheat exports in the past have been limited by concerns over quality and because the government buys large volumes at guaranteed minimum prices.

The country’s exports have also been held back by World Trade Organization rules that limit shipments from government stocks if the grain was bought from farmers at fixed prices.

Urgent need

The Ukrainian agriculture minister has traveled to Stuttgart for discussions with G-7 colleagues on getting its produce out.  

About “20 million tons” of wheat were sitting in Ukrainian silos and “urgently” needed to be exported, Ozdemir said.

Before the invasion, Ukraine exported 4.5 million tons of agricultural produce per month through its ports – 12% of the planet’s wheat, 15% of its corn and half of its sunflower oil.

But with the ports of Odesa, Chornomorsk and others cut off from the world by Russian warships, the supply can only travel on congested land routes that are much less efficient.

G-7 ministers urged countries not to take restrictive action that could pile further stress on the produce markets.  

They “spoke out against export stops and call as well for markets to be kept open”, said Ozdemir, whose nation holds the rotating presidency of the group.

“We call on India to assume its responsibility as a G-20 member,” Ozdemir added.

The agriculture ministers would also “recommend” the topic be addressed at the G-7 summit in Germany in June, which India’s prime minister, Narendra Modi, has been invited to attend.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 13th, 2022 by Vbiz

Elon Musk said on Friday his $44-billion deal for Twitter Inc was temporarily on hold, citing pending details on spam and fake accounts.

“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Musk said in a tweet.

Shares of the social media company fell 20% in premarket trading. Twitter did not immediately respond to a request for comment.

The company had earlier this month estimated that false or spam accounts represented fewer than 5% of its monetizable daily active users during the first quarter.

It also said it faced several risks until the deal with Musk is closed, including whether advertisers would continue to spend on Twitter.

Musk, the world’s richest man and the chief executive of Tesla Inc, had said that one of his priorities would be to remove “spam bots” from the platform.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 13th, 2022 by Vbiz

Chinese Premier Li Keqiang has suggested that China’s current job market is “complicated and severe” as the country maintains “unswerving adherence” to the “zero-COVID” policy, whose lockdowns are causing a severe economic contraction throughout the nation.

Derived from a survey of 430 private industrial companies, the Caixin purchasing managers’ index, a reliable indicator for assessing the economy, fell to 36.2 in April from 42 in March, according to a survey released by IHS Markit last week. A reading below 50 indicates contraction, while anything above that gauge shows expansion.

“Demand was under pressure, external demand deteriorated, supply shrank, supply chains were disrupted, delivery times were prolonged, backlogs of work grew, workers found it difficult to return to their jobs, inflationary pressures lingered, and market confidence remained below the long-term average,” said Wang Zhe, senior economist at Caixin Insight Group.

“Keeping market players and securing jobs will win the future,” Li said Saturday, during a national video and teleconference on stabilizing employment, according to the China Daily, a state-controlled news outlet.

Li, who holds the number two position in the Chinese Communist Party (CCP), urged all regional government departments to “conscientiously implement the decisions and arrangements” of the party’s Central Committee and the State Council to maintain jobs and economic stability.

“Stabilizing employment is critical to people’s livelihood and is the key support for the economy to run within a reasonable range,” he said, as he recommended steps for local and provincial governments.

Li asked enterprises to resume production while adhering to the controls designed to contain the spread of COVID-19.

Lockdowns in more than 20 cities, including Shanghai, have frustrated residents and constrained China’s economic growth. WHO Director-General Tedros Adhanom Ghebreyesus said on Tuesday that China’s zero-tolerance strategy was not sustainable, a comment Foreign Ministry spokeperson Zhao Lijian called “irresponsible” a day later.

Global banks such as UBS, Standard Chartered, DBS, Barclays and Bank of America have downgraded their 2022 GDP (gross domestic product) forecasts for China.

China’s first-quarter GDP for 2022 expanded by 4.8% year-on-year, higher than expected but still below Beijing’s full-year target of 5.5%, according to Xinhua, a state-affiliated news outlet.

Liu Meng-chun, managing director at Chung-Hua Institution for Economic Research in Taipei, Taiwan, said the slowdown is attributable not only to China’s COVID policies but also to a crackdown on private enterprise, especially in the technology sector.

He foresees the state taking a financial stake in some of the technology giants to get more control over their operations but said the change would be more one of style than of substance.

“If 1% equity is used to enter the core decision-making circle of its (technology companies) and becomes internal supervision, it represents a change in the supervision model,” Liu said.

Ming-Fang Tsai, a professor at the Department of Industrial Economics at Tamkang University in Taipei, said that even if Beijing stops suppressing tech giants, it would be difficult to return to the era of rapid economic growth.

“Alibaba and Tencent are laying off workers significantly, and now (Beijing) has said that it will stop (the suppression). It will not have any impact on China’s economy,” Tsai told VOA Mandarin.

The tech layoffs fit into a larger picture as China’s economy has been hit by the “five crises” of employment, exports, private investment, real estate and debt defaults, leading its economy into a downward cycle, according to Wu Jialong, a Taipei economist.

Reduced demand for China’s exports, “will reduce employment, income and consumption power, which will affect real estate,” Wu said. “In addition, industrial supervision and common prosperity will also make things worse, which will hurt the willingness and ability of private investment and eventually lead to a crisis of debt default.”

According to Taiwanese economist Liu, if China’s zero-COVID policy lasts for a long time, industries such as real estate, finance and technology will be hit hard, as will retail and consumer services. The combination, he said, will delay the country’s “common prosperity” campaign launched by President Xi Jinping.

“The control of the epidemic will make income distribution more uneven. Polarization will become more serious,” Liu told VOA Mandarin.

According to Xie Tian, an associate professor of marketing at the University of South Carolina Aiken, even if the zero-COVID policy caused the Chinese economy to collapse, Chinese authorities would be more likely to return to the planned economy of the Mao Zedong era than to adjust to current forces.

“Now the CCP has launched a lot of ‘supply and marketing cooperatives,’ ‘unified purchase and unified sales,’ just to deal with the economic impact that the city lockdowns may bring, because it wants to suppress the people, and the government controls all goods, sources of goods and channels to achieve its political goals.” Xie told VOA Mandarin.

“Unified purchase and unified sales” refers to a policy implemented by China from the 1950s to the 1980s to exert state control over agricultural resources such as grain and cotton. The Chinese government purchased these products in rural areas and rationed them out to city dwellers.

In July last year, China began a pilot program of “supply and marketing cooperatives.” This recalls how the CCP acted as it established a government in 1949 during a post-civil war period of material scarcity.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 13th, 2022 by Vbiz

California’s minimum wage will rise to $15.50 an hour for workers at all businesses, large and small, on Jan. 1, 2023, under an automatic inflation trigger built into state law and never previously activated, the governor’s office projected on Thursday.

The announcement came a day before Governor Gavin Newsom, a first-term Democrat, was slated to present his revised budget plan to the state legislature controlled by his party, including a proposed $11.8 billion inflation-relief spending package.

The economic stimulus proposal, similar to one enacted last year to help California recover from the COVID-19 pandemic, includes a plan Newsom previewed in recent weeks offering $400 tax rebates to vehicle owners to help offset escalating gasoline costs.

Newsom said his package taps into a “historic” state budget surplus to help individuals and families cope with rising costs of living, which the state Finance Department projects will grow 7.6% between fiscal year 2021 and fiscal 2022.

Regardless of whether Newsom’s package becomes law, the Finance Department estimates that some 3 million workers stand to benefit from the first inflation-based minimum wage hike expected to take effect under a labor statute enacted in 2016.

That law requires an automatic 50-cent-per-hour increase above California’s prevailing minimum wage levels – already the highest any state requires for larger companies – whenever the U.S. consumer price index rises more than 7% from year to year.

That means the statewide minimum wage for companies employing 26 or more workers, and those with 25 or fewer workers, will both go to $15.50 in the new year. Without an inflation trigger, the minimum wage for smaller companies was due to have topped out at $15 in January, catching up with the level now required at larger firms.

Only two states — Massachusetts and Washington state — exceed California’s existing $14 minimum wage for smaller companies. They require at least $14.25 and $14.49 per hour, respectively, at businesses of all sizes, U.S. Labor Department figures show.

The District of Columbia is higher still, at $15.20 an hour. The U.S. federal minimum hourly wage is currently set at $7.25.

Other highlights of Newsom’s inflation package include $2.7 billion in emergency rental assistance for low-income tenants and $1.4 billion to help utility customers pay overdue bills.

The California Republican Party issued a statement urging the legislature to suspend state gasoline taxes as “the most effective way to relieve pain at the pump.”

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 12th, 2022 by Vbiz

Canadian energy experts see the global spike in oil prices – exacerbated by the war in Ukraine – as a two-edged sword, spurring a rush to develop renewable energy sources while simultaneously encouraging increased production of environmentally damaging fossil fuels.

For Canada, a major energy exporter with the potential to fill part of the gap created by the broadening boycott of Russian energy sources, the balancing act is especially delicate.

The left-leaning government led by Prime Minister Justin Trudeau has pledged to make major investments in renewable energy. But the country is also home to the Alberta tar sands, described by National Geographic magazine as “the world’s most destructive oil operation.”

Speaking in Vancouver in late March, Trudeau announced a plan to spend $9.1 billion by 2030 to reduce carbon emissions through support for electric vehicles, energy-efficient homes and vehicles, wind and solar projects, support for sustainable farming and other measures.

“The leaders I spoke with in Europe over the past few weeks were clear,” Trudeau told reporters at the time. “They don’t just want to end their dependence on Russian oil and gas, they want to accelerate the energy transformation to clean and green power.

“The whole world is focusing on clean energy and Canada cannot afford not to do that,” he said.

But Trudeau’s long-term ambition may be complicated in the short term by the rising demand for oil from Canada – the world’s fourth largest exporter – and a renewed interest in the Alberta tar sands, which have become more profitable than they have been for years.

The environmental group Greenpeace Canada last year called for a halt to development of the heavy and hard-to-extract bitumen, saying, “The world can’t afford to expand the Alberta tar sands, not if we want to preserve this planet for future generations.”

And with world oil prices as low as $50 a barrel in recent years, many producers had in fact shelved plans to expand production, mainly because of high start-up costs that made the effort unprofitable. But with current prices topping $100 a barrel, the heavy sludge is suddenly much more appealing.

“It is certainly true that higher oil prices will increase interest in all oil resources, including the Canadian oil sands,” said Mark Finley, a former manager and analyst with an energy focus at the CIA. He is currently with Rice University’s Baker Institute for Public Policy. 

“Moreover, a growing interest in resilient supply chains and what U.S. Treasury Secretary [Janet] Yellen has called ‘friend-shoring’ will also work to the advantage of Canadian producers,” Finley said in an interview.

Hadrian Mertins-Kirkwood, an expert with the Canadian Center for Policy Alternatives, said it is “too soon to tell” what impact the war in Ukraine will have on energy investment in Canada. “We’re not seeing a lot of investment into new fossil fuel projects at this point, but that could change if the war drags on and prices stay high.”

Mertins-Kirkwood said industry announcements show “that investment in fossil fuels is up this year. That’s mainly due to rising oil prices, which started last year but really picked up after the Russian invasion.”

“Specifically, oil companies in Canada are intensifying production, which means they’re trying to get more oil out of existing projects to take advantage of the current price environment.”

On the green energy side, Mertins-Kirkwood suggested the Trudeau government’s spending plans fall far short of what its own calculations show will be needed to reach its goal of net-zero carbon emissions by 2050.

The most recent federal budget says Canada will need to between $125 billion and $140 billion of investment every year to reach that goal, he said, far beyond the current rate of investment in the climate transition of $15 billion to $25 billion.

But Finley said the Trudeau administration’s green ambitions are not necessarily in conflict with the renewed interest in Alberta’s tar sands. 

“The outcome of this situation, I think, could be both more investment in oil and gas, and an accelerated interest in pursuing the transition [to renewable energy],” he said. “In that sense, there should be common ground to be found between the government in Ottawa and government/industry in Alberta.

Finley noted that Canada is a natural partner for other Western countries as it belongs to many of the same key institutions, including the International Energy Agency, NATO and OECD, as well as being a major energy exporter.

“As the United States and Europe focus on diversifying supplies away from Russia, what kind of countries are likely to be perceived as reliable partners?” he asked.  “Canada would certainly be high on the list.”

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 12th, 2022 by Vbiz

Though inflation may be soaring, supply chains remain snarled, and the coronavirus won’t go away, America’s casinos are humming right along, recording the best month in their history in March.

The American Gaming Association, the gambling industry’s national trade group, said Wednesday that U.S. commercial casinos won more than $5.3 billion from gamblers in March, the best single-month total ever. The previous record month was July 2021 at $4.92 billion.

The casinos collectively also had their best first quarter ever, falling just short of the $14.35 billion they won from gamblers in the fourth quarter of last year, which was the highest three-month period in history.

Three states set quarterly revenue records to start this year: Arkansas ($147.4 million); Florida ($182 million), and New York ($996.6 million).

The numbers do not include tribal casinos, which report their income separately and are expected to report similarly positive results.

But while the national casino economy is doing well, there are pockets of sluggishness such as Atlantic City, where in-person casino revenue has not yet rebounded to pre-pandemic levels.

“Consumers continue to seek out gaming’s entertainment options in record numbers,” said Bill Miller, the association’s president and CEO. He said the strong performance to start 2022 came “despite continued headwinds from supply chain constraints, labor shortages and the impact of soaring inflation.”

The trade group also released its annual State of the States report on Wednesday, examining gambling’s performance across the country.

As previously reported, nationwide casino revenue set an all-time high in 2021 at $53.03 billion, up 21% from the previous best year, 2019, before the coronavirus pandemic hit.

But the report includes new details, including that commercial casinos paid a record $11.69 billion in direct gambling tax revenue to state and local governments in 2021. That’s an increase of 75% from 2020 and 15 percent from 2019. This does not include the billions more paid in income, sales and other taxes, the association said.

It also ranked the largest casino markets in the U.S. in terms of revenue for 2021. The Las Vegas Strip is first at $7.05 billion, followed by:

Atlantic City ($2.57 billion)
the Chicago area ($2.01 billion)
Baltimore-Washington D.C. ($2 billion)
the Gulf Coast ($1.61 billion)
New York City ($1.46 billion)
Philadelphia ($1.40 billion)
Detroit ($1.29 billion)
St. Louis ($1.03 billion)
the Boulder Strip in Nevada ($967 million)

The association divides most of Pennsylvania’s casinos into three separate markets: Philadelphia, the Poconos and Pittsburgh. Their combined revenue of nearly $2.88 billion would make them the second largest market in the country if judged as a single entity. It also counts downtown Las Vegas, and its $731 million in revenue, as a separate market.

Seven additional states legalized sports betting and two more added internet gambling in 2021.

The group reported many states saw gamblers spending more in casinos while visiting them in lower numbers compared to pre-pandemic 2019.

The average age of a casino patron last year was 43 1/2, compared to 49 1/2 in 2019.

Americans bet $57.7 billion on sports last year, more than twice the amount from 2020. That generated $4.33 billion in revenue, an increase of nearly 180% over 2020.

Internet gambling revenue reached $3.71 billion last year, and three states — New Jersey, Pennsylvania and Michigan — each won more than $1 billion online. West Virginia’s internet gambling market reached $60.9 million in revenue in its first full year of operation, while Connecticut’s two internet casinos reported combined revenue of $47.6 million after launching in October.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 12th, 2022 by Vbiz

Calling US farms the ‘breadbasket of democracy,’ president vows to do more to offset food supply issues amid Russian invasion

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 12th, 2022 by Vbiz

President Joe Biden on Wednesday hailed American farmers as the “backbone of freedom,” pledging hundreds of millions of dollars’ worth of support and calling on them to offset a global grain shortage caused by Russian President Vladimir Putin’s invasion of Ukraine.

“You’re literally the backbone of our country, it’s not hyperbole,” he said, speaking at a family farm in Kankakee, Illinois, where, earlier in the day, he stood in front of a tractor and gazed over growing waves of grain. “But you also feed the world. And we’re seeing, with Putin’s war in Ukraine, you’re like the backbone of freedom.”

Russia’s 11-week-old invasion of Ukraine has imperiled global supplies of wheat, corn, barley, oilseeds and cooking oil, and it has disrupted fertilizer supplies. World food prices have risen nearly 13% in the wake of the invasion, the White House says.

Biden has announced a number of interventions for American farmers. Those include support that would allow farmers to plant two sets of crops in one year; access to technology that would allow for less fertilizer use, and the doubling of funding for domestic fertilizer production, to $500 million.

Biden told the gathered farm community that blame for the crisis rested on Putin, whose navy is blocking Ukrainian exports from Black Sea ports.

“But we’re doing something about it,” Biden said. “And our farmers are helping … on both fronts, reducing the … price of food at home and expanding production and feeding the world in need.”

The head of the European Investment Bank (EIB) this week sounded the alarm, saying that Ukraine is sitting on a staggering amount of wheat it can’t export.

“Ukraine is a rich country,” EIB President Werner Hoyer said. “Ukraine is the wheat basket of Europe, and it’s sitting on €8 billion (U.S. $8.5 billion) worth of wheat right now from last year’s harvest. They cannot export it; they have no access to the sea.

“This is one of the key issues that we must address, because they are industrious people,” he added. “They are sowing like crazy right now, and they will expect probably a good harvest, maybe 70% of last year’s harvest, in a couple of months — and then what to do with it? So these are issues that need to be addressed immediately, in addition to the social needs and the daily problems that Ukrainian citizens face.”

 

Worldwide effects

The European Union’s top diplomat warned of global impact.

“They are causing scarcity,” EU foreign affairs chief Josep Borrell said of the Russian military, which invaded Ukraine on February 24. “They are bombing Ukrainian cities and provoking hunger in the world.”

Already the effects have spread across the world. Last month, farmers in Sri Lanka participated in strikes over rising food and fuel prices. That movement ultimately resulted in the resignation of the island nation’s Cabinet and prime minister.

And the crisis is likely to hit hardest in parts of the world where resources are already stretched thin, analysts said.

“This is a real reversal for the global economy,” Desmond Lachman, a senior fellow at the American Enterprise Institute, told VOA. “And those are the countries that are impacted the most — countries that are very reliant on food and energy imports are really going to get hit very hard. And politically, it’s going to be extremely difficult for those countries.”

Analysts say food price inflation could lead to instability on the world’s least-developed continent.

“Most African governments will scramble to cushion the loss of purchasing power stemming from higher inflation,” said Jacques Nel, head of economic-focused research firm Africa Macro. “Many will not be able to provide the necessary relief. Unrest is a matter of when and where, and not if.”

History shows that the humble grain holds immense power, perhaps no more famously than when the price of bread nearly doubled in 1788 France. Peasants revolted against the monarchy, hungry for governance ruled by the principles of liberty, equality and fraternity. Revolution came the following year.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 12th, 2022 by Vbiz

Uzbek cotton farmers are celebrating the lifting of a 13-year-old international boycott of their product following a finding that the cautiously reform-minded government is no longer using organized forced labor to harvest the economically vital crop.

The decision will open the door to long-closed markets for one of the world’s biggest cotton producers, including major American clothing retailers such as Amazon, Gap, J.Crew, Target and Walmart.

The U.S.-based Cotton Campaign, a coalition of more than 300 businesses and organizations, initiated the boycott in 2009. At that time, it said, the Uzbek authorities were “forcing over 1 million children and adults, including medical staff, public sector employees and students, to pick cotton every year during the harvest.”

 

The boycott ended after the Uzbek Forum for Human Rights, a Cotton Campaign partner, reported this spring that it found “no systemic or systematic, government-imposed forced labor during the cotton harvest” in 2021.

Despite the Uzbek Forum’s finding of discrete incidents of forced labor in several regions, the Cotton Campaign said, “This historic achievement comes after years of persistent engagement by Uzbek activists, international advocates and multinational brands, together with a commitment by the government of Uzbekistan to end its use of forced labor.”

The campaign now urges end users to conduct human rights due diligence at all stages of production — at cotton farms, spinners, fabric mills and manufacturing units — and ensure to have “credible, independent mechanisms in place for forced labor prevention, monitoring, grievance and remedy.”

The Cotton Campaign also fights state-sponsored forced labor in Turkmenistan, which it defines as “one of the most closed and repressive countries in the world.”

It says the authoritarian government there every year “forces tens of thousands of public sector workers to pick cotton in hazardous and unsanitary conditions and extorts money from public employees to pay harvest expenses.”

Jonas Astrup, the International Labor Organization technical adviser in Tashkent, told VOA that freeing Uzbek cotton “from systemic forced and child labor is a political victory for the country.”

“They did not get rid of the boycott to please the international community but for Uzbekistan itself. Responsibility and accountability ultimately lie with the Uzbek people for how and whether they trust the system and how and whether the government can deliver for its citizens,” he said. “But it’s time to seize economic benefits of job creation, economic growth, attracting trade and investment to the country.”

Astrup said the biggest root cause of forced labor “was the state quota system for cotton production and official complicity in it. That has been changed but will take time, of course. But the system of production quotas for provinces, districts and farmers has gone away, and this is really the key.”

 

The ILO has been monitoring child labor in Uzbekistan since 2013 and forced labor since 2015. It has a network of 17 independent civil society activists, including former political prisoners, who will continue to use tested tools and methodology.

“We have helped inspections grow from 200 to 400 labor inspectors. They are now issuing an annual report with data that is useful for policy and business decisions. They have the mandate to issue fines, investigate violations and submit cases for criminal prosecution,” Astrup said.

Astrup sees the end of the boycott as especially timely as Uzbekistan weathers the impact of sanctions on Russia, a key trading partner.

“We can help Uzbekistan credibly develop its textile and garment industry and give assurance to international brands and retailers that they can start placing orders,” he said.

Astrup added that the ILO and its partners will establish a Better Work Uzbekistan program, focusing on social dialogue mechanisms at factories and cotton-textile clusters, including collective bargaining and bringing employers and workers to the table with government to promote reforms.

Human rights advocates, meanwhile, are calling on the Uzbek government to accelerate reforms and adhere to its international obligations.

Speaking in Tashkent, Bennett Freeman, a Cotton Campaign co-founder and former U.S. deputy assistant secretary of state for democracy, human rights and labor, said Uzbekistan’s next challenge is “to open space for civil society and to create the enabling environment essential for responsible sourcing that will attract global brands and protect labor and human rights.”

Hugh Williamson, director of Human Rights Watch’s Europe and Central Asia division, said Tashkent must lift restrictions on activists and NGOs “to enable them to monitor forced labor and ensure this terrible abuse does not return.”

Tanzila Narbayeva, Uzbekistan’s Senate chair who has led efforts to end forced and child labor, admits the country still faces enormous problems.

 

“Ensuring human rights and freedom, specifically labor rights, is one of the priorities in our development strategy,” Narbayeva told VOA.

“First, we will strengthen our legal basis, synchronizing our laws with international standards. We will continue reforming agriculture and must also develop our institutions, including a solid monitoring system to base policy on reliable data and research,” she said.

Narbayeva said Tashkent hears international calls for an independent civil society. She said the government is processing registration applications and conducting a discourse with nongovernmental groups.

“We want a pro-active civil society which closely works with relevant international organizations. There will be grants for NGOs, funding for anti-forced labor advocacy and promoting rights in the workplace,” she said.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 11th, 2022 by Vbiz

A top U.S. energy official says Russia’s war on Ukraine has driven home the need to diversify supply chains, and that Africa can benefit from this. Jose Fernandez made the comment to VOA Wednesday at an annual conference on African mining in Cape Town, South Africa.

Jose Fernandez, the U.S. Undersecretary for economic growth, energy, and the environment, is the highest-ranking American official ever to attend the Investing in African Mining conference, or Indaba. Indaba is a Zulu word for discussions.

Speaking to VOA, Fernandez said the U.S. is very interested in working with African partners to make the kind of investments that will benefit both sides.

“That’s a message that I’m not sure has been made here in the last few years,” he said.

He said Russia’s attempts to weaponize its oil and gas exports to Europe highlights the fact that the U.S., and other countries, cannot depend on one, or two, or even three suppliers for important products.

“Something we need to diversity is our sources of energy. We need to invest more in renewables. That requires wind turbines, it requires solar panels, it requires electric batteries and other components that are going to be critical for the energy future,” he said.

Fernandez said the U.S. geological service has identified almost 40 critical minerals that are going to be needed for a clean energy future as well as in products like cars, computers and chips — noting that Africa has many of them.

How could the continent benefit?

“In order to do that, it’s going to require foreign investment and one way or the best way to attract foreign investment is to have clear rules and a transparent regulatory regime. What I am here to do, is to see how the U.S. can help Africa take advantage of the opportunity and create jobs,” said Fernandez.

Tony Carrol, executive advisor of the conference, says the importance of Fernandez’s attendance cannot be overstated.

“It’s the first truly high-ranking U.S. government official we’ve had at the mining indaba in the 28 years. He is responsible for the energy and natural resource portfolio within the State Department and reports directly to the secretary of state. His meetings here were meaningful and I think they were enthused about this event and looking forward to coming back,” he said.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 11th, 2022 by Vbiz

In any country, the currency exchange rate is an indicator of stability and the economy’s strength. With unprecedented sanctions being imposed on Russia, many economists are closely watching the ruble. Anna Rice narrates the story of the Russian ruble, and the effect economic sanctions are having.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 11th, 2022 by Vbiz

U.S. consumer price growth slowed sharply in April as gasoline prices eased off record highs, suggesting that inflation has probably peaked, though it is likely to stay hot for a while and keep the Federal Reserve’s foot on the brakes to cool demand.

The consumer price index rose 0.3% last month, the smallest gain since last August, the Labor Department said on Wednesday. That stood in sharp contrast to the 1.2% month-to-month surge in the CPI in March, which was the largest advance since September 2005.

But the deceleration in the CPI is probably temporary. Gasoline prices, which accounted for most of the pull back in the monthly inflation rate, are rising again and were about $4.161 per gallon early this week after dipping below $4 in April, according to the Energy Information Administration.

Russia’s unprovoked war against Ukraine is the main catalyst for the surge in gasoline prices. The war has also driven up global good prices.

Inflation was already a problem before Moscow’s Feb. 24 invasion of Ukraine because of stretched global supply chains as economies emerged from the COVID-19 pandemic after governments around the world injected large amounts of money in pandemic relief and central banks slashed interest rates.

President Joe Biden on Tuesday acknowledged the pain that high inflation was inflicting on American families and said bringing prices down “is my top domestic priority.”

The Fed last week raised its policy interest rate by half a percentage point, the biggest hike in 22 years, and said it would begin trimming its bond holdings next month. The U.S. central bank started raising rates in March.

In the 12 months through April, the CPI increased 8.3%. While that was the first deceleration in the annual CPI since last August, it marked the seventh straight month of increases in excess of 6%. The CPI shot up 8.5% in March, the largest year-on-year gain since December 1981.

Economists polled by Reuters had forecast consumer prices gaining 0.2% in April and rising 8.1% year-on-year.

While monthly inflation will likely pickup, annual readings are likely to subside further as last year’s large increases fall out of the calculation, but remaining above the Fed’s 2% target at least through 2023.

China’s zero tolerance COVID-19 policy is seen putting more strain on global supply chains, driving up goods prices. Prices for services like air travel and hotel accommodation are also seen keeping inflation elevated amid both strong demand over the summer and a shortage of workers.

Solid gains in rents, airline fares and new motor vehicle prices boosted underlying inflation last month.

Excluding the volatile food and energy components, the CPI picked up 0.6% after rising 0.3% in March. The so-called core CPI increased 6.2% in the 12-months through April. That followed a 6.5% jump in March, which was largest gain since August 1982.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 11th, 2022 by Vbiz

The Senate confirmed economist Lisa Cook on Tuesday to serve on the Federal Reserve’s board of governors, making her the first Black woman to do so in the institution’s 108-year history. 

Her approval was on a narrow, party-line vote of 51-50, with Vice President Kamala Harris casting the decisive vote. 

Senate Republicans argued that she is unqualified for the position, saying she doesn’t have sufficient experience with interest rate policy. They also said her testimony before the Senate Banking Committee suggested she wasn’t sufficiently committed to fighting inflation, which is running at four-decade highs. 

Cook has a doctorate in economics from the University of California, Berkeley, and has been a professor of economics and international relations at Michigan State since 2005. She was also a staff economist on the White House Council of Economic Advisers from 2011 to 2012 and was an adviser to President Joe Biden’s transition team on the Fed and bank regulatory policy. 

Some of her most well-known research has focused on the impact of lynchings and racial violence on African American innovation. 

Cook is only the second of Biden’s five nominees for the Fed to win Senate confirmation. His Fed choices have faced an unusual level of partisan opposition, given the Fed’s history as an independent agency that seeks to remain above politics. 

Some critics charge, however, that the Fed has contributed to the increased scrutiny by addressing a broader range of issues in recent years, such as the role of climate change on financial stability and racial disparities in employment. 

Biden called on the Senate early Tuesday to approve his nominees as the Fed seeks to combat inflation. 

“I will never interfere with the Fed,” Biden said. “The Fed should do its job and will do its job, I’m convinced.” 

Fed Chair Jerome Powell is currently serving in a temporary capacity after his term ended in February. He was approved by the Senate Banking Committee by a nearly unanimous vote in March. 

Fed governor Lael Brainard was confirmed two weeks ago for the Fed’s influential vice chair position by a 52-43 vote. 

Philip Jefferson, an economics professor and dean at Davidson College in North Carolina, also has been nominated by Biden for a governor slot and was approved unanimously by the Finance Committee. He would be the fourth Black man to serve on the Fed’s board. 

Biden has also nominated Michael Barr, a former Treasury Department official, to be Fed’s top banking regulator, after a previous choice, Sarah Bloom Raskin, faced opposition from West Virginia Democratic Sen. Joe Manchin. 

Cook, Jefferson, and Barr would join Brainard as Democratic appointees to the Fed. Yet most economists expect the Fed will continue on its path of steep rate hikes this year. 

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 11th, 2022 by Vbiz

US president presents plan to counter inflation, criticizes Republican opponents’ plan as ‘backwards’

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 10th, 2022 by Vbiz

Wall Street is tumbling toward its lowest point in more than a year on Monday as renewed worries about China’s economy pile on top of markets already battered by rising interest rates. 

The S&P 500 was 2.3% lower in afternoon trading after coming off its fifth straight losing week, its longest such streak in more than a decade. It joined a worldwide swoon for markets. Not only did stocks fall across Europe and much of Asia, but so did everything from old-economy crude oil to new-economy bitcoin. 

The Dow Jones Industrial Average was down 374 points, or 1.1%, at 32,520, as of 3:16 p.m. Eastern time, and the Nasdaq composite was 3.4% lower as tech-oriented stocks again took the brunt of the sell-off. Monday’s sharp drop leaves the S&P 500, Wall Street’s main measure of health, down roughly 16% from its record set early this year. 

Most of this year’s damage has been the result of the Federal Reserve’s aggressive flip away from doing everything it can to prop up financial markets and the economy. The central bank has already pulled its key short-term interest rate off its record low of near zero, where it sat for nearly all of the pandemic. Last week, it signaled additional increases of double the usual amount may hit in upcoming months, in hopes of stamping out the high inflation sweeping the economy. 

The moves by design will slow the economy by making it more expensive to borrow. The risk is the Fed could cause a recession if it moves too far or too quickly. In the meantime, higher rates discourage investors from paying very high prices for investments, because investors can get more than before from owning super-safe Treasury bonds instead. 

That’s helped cause a roughly 29% tumble for bitcoin since April’s start, for example. It dropped 10.8% Monday, according to Coindesk. Worries about the world’s second-largest economy added to the gloom Monday. Analysts cited comments over the weekend by a Chinese official warning of a grave situation for jobs, as the country hopes to halt the spread of COVID-19. 

Authorities in Shanghai have again tightened restrictions, amid citizen complaints that it feels endless, just as the city was emerging from a month of strict lockdowns after an outbreak. 

The fear is that China’s strict anti-COVID policies will add more disruptions to worldwide trade and supply chains, while dragging on its economy, which for years was a main driver of global growth. 

In the past, Wall Street has been able to remain steady despite similar pressures because of the strong profit growth that companies were producing. 

But this most recent earnings reporting season for big U.S. companies has yielded less enthusiasm. Companies overall are reporting bigger profits for the latest quarter than expected, as is usually the case. But discouraging signs for future growth have been plentiful. 

The number of companies citing “weak demand” in their conference calls following earnings reports jumped to the highest level since the second quarter of 2020, strategist Savita Subramanian wrote in a BofA Global Research report. Tech earnings are also lagging, she said. 

The tech sector is the largest in the S&P 500 by market value, giving it additional weight for the market’s movements. Many tech-oriented companies saw profits boom through the pandemic as people looked for new ways to work and entertain themselves while locked down at home. But slowdowns in their profit growth leave their stocks vulnerable after their prices shot so high on expectations of continued gains. 

The higher interest rates engineered by the Fed are also hitting their stock prices particularly hard because they’re seen as some of the market’s most expensive. The Nasdaq composite’s loss of roughly 25% for 2022 so far is much sharper than that for other indexes. 

Electric automaker Rivian Automotive slumped 19.1% Monday as restrictions expired that prevented some big investors from selling their shares following its stock market debut six months ago. It’s lost more than three quarters of its value so far this year. 

The yield on the 10-year Treasury has shot to its highest level since 2018 as inflation and expectations for Fed action rose. It moderated Monday, dipping to 3.07% from 3.12% late Friday. But it’s still more than double the 1.51% level where it started the year. 

In Asian stock markets, Japan’s Nikkei 225 fell 2.5%, and South Korea’s Kospi lost 1.3%. Stocks in Shanghai inched up 0.1%. 

In Europe, France’s CAC 40 fell 2.8%, and Germany’s DAX lost 2.1%. London’s FTSE 100 slid 2.3%. 

Apart from concerns about inflation and coronavirus restrictions, the war in Ukraine is still a major cause for uncertainty. More than 60 people were feared dead after a Russian bomb flattened a school being used as a shelter, Ukrainian officials said. Moscow’s forces pressed their attack on defenders inside Mariupol’s steel plant in an apparent race to capture the city ahead of Russia’s Victory Day holiday Monday. 

Even the energy sector, a star performer in recent weeks, was under pressure on Monday. Benchmark U.S. crude fell 6.1% to settle at $103.09 per barrel, though it’s still up about 40% this year. Brent crude, the international standard, fell 5.7% to settle at $105.94 a barrel. 

 

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 9th, 2022 by Vbiz

Ukrainian officials say farmland used for planting spring crops could more than halved this year because of the war.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 9th, 2022 by Vbiz

When you think about places to get some rest, airplanes don’t normally come to mind. Aerotel is trying to change all that. Romain Chanson reports for VOA from northern South Africa, in this piece narrated by Carol Guensburg.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 7th, 2022 by Vbiz

The U.N. Food and Agriculture Organization (FAO) says global food prices stabilized last month at a very high level but were slightly lower than in March, which saw the highest ever jump in food prices.

FAO officials see little prospect of a significant decrease in the price of food as long as the Russian-Ukrainian war goes on. Both countries combined account for nearly a third of the world’s wheat and barley exports and up to 80% of sunflower seed oil shipments.

The FAO’s deputy director in the markets and trade division, Josef Schmidhuber, said disruption in the export of those and other food commodities from Ukraine is taking a heavy toll on global food security. He said poor countries are suffering most because they are being priced out of the market.

“It is an almost grotesque situation that we see at the moment,” he said. “In Ukraine, there are nearly 25 million tons of grain that could be exported but they cannot leave the country simply because of the lack of infrastructure and the blockade of the ports. At the same time…there is no wheat corridor opening up for exports from Ukraine.”

Ukraine’s summer crop of wheat, barley, and corn will be harvested in July and August. Despite the war, Schmidhuber said harvest conditions are not dire. He said about 14 million tons of grain should be available for export.

However, he notee there is not enough storage capacity in Ukraine. He added there is a great deal of uncertainty about what will happen over the next couple of months as the conflict grinds on.

“And what we also see, and that is, of course, only anecdotal evidence, that grain is being stolen by Russia and is being transported on trucks into Russia,” Schmidhuber said. “The same goes for agricultural implements, tractors, etc., etc. And all that could have a bearing on agricultural output.”

The FAO official said the situation in Ukraine indicates that the current problem is not one of availability, but one of access. He said there is enough grain to go around and feed the world. The problem, he said, is the food is not moving to the places where it is needed.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 7th, 2022 by Vbiz

In lush fields southwest of Paris, farmers are joining Europe’s fight to free itself from Russian gas.

They’ll soon turn on the tap of a new facility where crops and agricultural waste are mashed up and fermented to produce “biogas.” It’s among energy solutions being promoted on the continent that wants to choke off funding for Russia’s war in Ukraine by no longer paying billions for Russian fossil fuels.

Small rural gas plants that provide energy for hundreds or thousands of nearby homes aren’t — at least anytime soon — going to supplant the huge flows to Europe of Russian gas that powers economies, factories, business and homes. And critics of using crops to make gas argue that farmers should be concentrating on growing food — especially when prices are soaring amid the fallout of the war in Ukraine, one of the world’s breadbaskets.

Still, biogas is part of the puzzle of how to reduce Europe’s energy dependence.

The European Biogas Association says the European Union could quickly scale up the production of bio-methane, which is pumped into natural gas networks. An investment of 83 billion euros ($87.5 billion) — which, at current market prices, is less than the EU’s 27 nations pay per year to Russia for piped natural gas — would produce a tenfold increase in bio-methane production by 2030 and could replace about a fifth of what the bloc imported from Russia last year, the group says.

The farmers around the Paris-region village of Sonchamp feel their new gas plant will do its bit to untie Europe from the Kremlin.

“It’s not coherent to go and buy gas from those people who are waging war on our friends,” said Christophe Robin, one of the plant’s six investors, who farms wheat, rapeseed, sugar beets and chickens.

“If we want to consume green (energy) and to avoid the flows and contribution of Russian gas, we don’t really have a choice. We have to find alternative solutions,” he said.

Biogas is made by fermenting organic materials — generally crops and waste. Robin likened the process to food left too long in a container.

“When you open it, it goes ‘Poof.’ Only here, we don’t open it. We collect the gas that comes from the fermentation,” he said.

The gas from their plant could meet the needs of 2,000 homes. It will be purified into bio-methane and injected into a pipeline to the nearby town of Rambouillet, heating its hospital, swimming pool and homes.

“It’s cool,” said Robin. “The kids will benefit from local gas.”

Like in the rest of Europe, the production of bio-methane in France is still small. But it is booming. Almost three bio-methane production sites are going online every week in France on average and their numbers have surged from just 44 at the end of 2017 to 365 last year. The volume of gas they produced for the national network almost doubled in 2021 compared to the previous year and was enough for 362,000 homes.

France’s government has taken several steps to quicken bio-methane development since Russia invaded Ukraine on Feb. 24. The industry says bio-methane met almost 1% of France’s needs in 2021 but that will increase to at least 2% this year and it could make up 20% of French gas consumption by 2030, which would be more gas than France imported last year from Russia.

The Sonchamp farmers took out 5 million euros ($5.3 million) in loans and received a 1-million-euro state subsidy to build their plant, Robin said. They signed a 15-year contract with utility firm Engie, with a fixed price for their gas. That will limit their ability to profit from high gas prices now but ensures them a stable income.

“We’re not going to be billionaires,” said Robin.

Workers are finishing the construction and the plant is almost ready to be connected to the network. Piles of agricultural waste — wheat husks, pulped sugar beets, onion peelings, even chicken droppings — have been prepared to be fed into the giant bubble-like fermentation tanks.

Winter barley specially grown to make gas will make up about 80% of the 30 tons of organic material that will be fed each day into the plant.

Robin insists that the barley won’t interfere with the growing of other crops for food, which critics worry about. Instead of one food crop per year, they’ll now have three harvests every two years — with the barley as extra, sandwiched in between, Robin said.

In Germany, the biggest biogas producer in Europe, the government is cutting down on crop cultivation for fuels. The share of corn permitted in biogas facilities will be lowered from 40% to 30% by 2026. Financial incentives will be provided so operators use waste products such as manure and straw instead.

Germany is estimated to have over 9,500 plants, many of them small-scale units supplying rural villages with heat and electricity.

Andrea Horbelt, a spokeswoman for the German biogas association, said the production of bio-methane could be doubled in a matter of years but also wouldn’t be cheap.

“Using biogas for electricity is more expensive than solar and wind, and will always remain so,” she said.

At the end of their gas-making process, the Sonchamp farmers will also get nitrogen- and potassium-rich wastes from the fermenters that they’ll use to fertilize their fields, reducing their consumption of industrial fertilizer.

“It’s a circular economy and it’s green. That pleases me,” Robin said. “It’s a superb adventure.”

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 6th, 2022 by Vbiz

A UN report recently warned 97% of Afghanistan’s population could sink below the poverty line.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 6th, 2022 by Vbiz

America’s employers added 428,000 jobs in April, extending a streak of solid hiring that has defied punishing inflation, chronic supply shortages, the Russian war against Ukraine and much higher borrowing costs.

Friday’s jobs report from the Labor Department showed that last month’s hiring kept the unemployment rate at 3.6%, just above the lowest level in a half-century.

The economy’s hiring gains have been strikingly consistent in the face of the worst inflation in four decades. Employers have added at least 400,000 jobs for 12 straight months.

At the same time, the April job growth, along with steady wage gains, will help fuel consumer spending and likely keep the Federal Reserve on track to raise borrowing rates sharply to try to slow inflation. Early trading Friday in the stock market reflected concern that the strength of the job market will keep wages and inflation high and lead to increasingly heavy borrowing costs for consumers and businesses. Higher loan rates could, in turn, weigh down corporate profits.

“With labor market conditions still this strong — including very rapid wage growth — we doubt that the Fed is going to abandon its hawkish plans,″ said Paul Ashworth, chief U.S. economist at Capital Economics.

The latest employment figures contained a few cautionary notes about the job market. The government revised down its estimate of job gains for February and March by a combined 39,000. And the number of people in the labor force declined in April by 363,000, the first drop since September. Their exit slightly reduced the proportion of Americans who are either working or looking for work from 62.4% to 62.2%.

Still, at a time when worker shortages have left many companies desperate to hire, employers kept handing out pay raises last month. Hourly wages rose 0.3% from March and 5.5% from a year ago.

Across industries last month, hiring was widespread. Factories added 55,000 jobs, the most since last July. Warehouses and transportation companies added 52,000, restaurants and bars 44,000, health care 41,000, finance 35,000, retailers 29,000 and hotels 22,000. Construction companies, which have been slowed by shortages of labor and supplies, added just 2,000.

Yet it’s unclear how long the jobs boom will continue. The Fed this week raised its key rate by a half-percentage point — its most aggressive move since 2000 — and signaled further large rate hikes to come. As the Fed’s rate hikes take effect, they will make it increasingly expensive to spend and hire.

In addition, the vast economic aid that the government had been supplying to households has expired. And Russia’s invasion of Ukraine has helped accelerate inflation and clouded the economic outlook. Some economists warn of a growing risk of recession.

For now, the resilience of the job market is particularly striking when set against the backdrop of galloping price increases and rising borrowing costs. This week, the Labor Department provided further evidence that the job market is still booming. It reported that only 1.38 million Americans were collecting traditional unemployment benefits, the fewest since 1970. And it said that employers posted a record-high 11.5 million job openings in March and that layoffs remained well below pre-pandemic levels.

What’s more, the economy now has, on average, two available jobs for every unemployed person. That’s the highest such proportion on record.

And in yet another sign that workers are enjoying unusual leverage in the job market, a record 4.5 million people quit their jobs in March, evidently confident that they could find a better opportunity elsewhere.

Still, the nation remains 1.2 million jobs short of the number it had in February 2020, just before the pandemic tore through the economy.

Chronic shortages of goods, supplies and workers have contributed to skyrocketing price increases — the highest inflation rate in 40 years. Russia’s invasion of Ukraine in late February dramatically worsened the financial landscape, sending global oil and gas prices skyward and severely clouding the national and global economic picture.

In the meantime, with many industries slowed by labor shortages, companies have been jacking up wages to try to attract job applicants and retain their existing employees. Even so, pay raises haven’t kept pace with the spike in consumer prices.

That’s why the Fed, which most economists say was much too slow to recognize the inflation threat, is now raising rates aggressively. Its goal is a notoriously difficult one: a so-called soft landing.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 6th, 2022 by Vbiz

Experts warn that the Federal Reserve’s efforts to tamp down inflation in the United States could have damaging effects, perhaps lasting several years, on developing economies around the world by encouraging capital flight, raising the rates on sovereign debt and destabilizing their currencies.

On Wednesday, the central bank announced that the Federal Open Market Committee, which sets the benchmark federal funds rate, had voted to increase the target rate by one-half of 1%, to between 0.75% and 1%. Further, the Fed indicated that it aimed to impose a series of additional half-point increases through the remainder of the year.

“Inflation is much too high, and we understand the hardship it is causing, and we are moving expeditiously to bring it back down,” Fed Chair Jerome Powell said in a news conference after the committee meeting Wednesday.

When Powell said that increases of more than 50 basis points were not currently part of the central bank’s plan, he offered some relief to those wondering whether the Fed might be considering even larger increases. Nevertheless, the prospect of the Fed going into full inflation-fighting mode has many concerned about the impact its actions might have on developing countries.

Multiple concerns

There are a number of reasons emerging markets might suffer when U.S. interest rates rise.

One is the prospect of capital flight. Investors who have invested in emerging markets to take advantage of higher rates of return may find investment in the U.S. more attractive as rates rise, prompting them to move capital to the U.S.

Higher interest rates in the U.S. can also result in higher rates globally. In April, the International Monetary Fund issued a report that found that 60% of low-income developing countries were either already experiencing debt distress or were at high risk of doing so. The report warned, “Past episodes suggest that rapid interest rate increases in advanced economies can tighten external financial conditions for emerging market and developing economies.”

Another danger to emerging economies in a rising interest rate environment is currency depreciation, which reduces purchasing power and increases the difficulty of servicing debt denominated in foreign currencies, such as the U.S. dollar.

Historical perspective

Economic historian Jamie Martin, an assistant professor at Georgetown University, told VOA that there is a strong historical correlation between sharp interest rate increases in the U.S. and catastrophic economic consequences in the developing world.

In the years after World War I, a rise in rates orchestrated in part by the Fed and the Bank of England helped reverse a recession in major industrialized countries. However, it resulted in several years of curtailed growth in nonindustrialized countries.

Similarly, the Fed’s aggressive rate hikes in the early 1980s successfully tamed double-digit inflation in the U.S. but pushed global interest rates so high that numerous developing countries, particularly in Latin America, defaulted on their debts.

In 2013, when then-Fed Chair Ben Bernanke hinted that rate increases were on the horizon, the impact on emerging markets was instant, with capital rapidly flowing out and currency instability setting in.

“History should counsel extreme caution,” Martin said. “Because, over as long as a century, when the U.S. Fed and other kinds of globally systemic central banks have moved to aggressively tighten monetary policy, almost every time, it’s had dramatic global effects. Particularly in what we have come to call developing economies.”

Fed research supports concern

The impact of U.S. rate increases on the developing world has not always been well understood. Paul Volcker, the Federal Reserve chairman who orchestrated the increasing of interest rates to nearly 20% in the 1980s, would later say that his focus had been on the U.S. and that the impact on the developing world hadn’t been part of his calculus.

“Africa was not even on my radar screen,” he said.

Now, though, the connections between actions by the Fed and the broader global economy are better understood.

In a 2021 article published by the central bank, Fed economists Jasper Hoek and Emre Yoldas, and Steve Kamin of the American Enterprise Institute noted that there are multiple instances in which rate increases in the U.S. have been shown to “increase debt burdens, trigger capital outflows, and generally cause a tightening of financial conditions that can lead to financial crises.”

While they didn’t find that economic crises in emerging markets always resulted from U.S. rate hikes, one of their observations would seem to apply to the current circumstances: “If higher rates are driven mainly by worries about inflation or a hawkish turn in Fed policy … this will likely be more disruptive for emerging markets.”

Pushed ‘over the edge’

Organizations that track the indebtedness of developing countries warn that conditions across the developing world are already dire. In particular, the effects of the coronavirus pandemic as well as a global spike in food prices exacerbated by the war in Ukraine have already created severe economic disruption.

A recent debt default by Sri Lanka has some concerned that further defaults may be coming.

“Many lower income countries have already been pushed into (a) deep debt crisis by the pandemic and rising energy and food prices,” Jerome Phelps, head of advocacy for the London-based Jubilee Debt Campaign, told VOA in an email exchange.

“They are diverting crucial resources away from healthcare and the needs of communities to debt payments, often to U.S. and European banks who stand to make large profits if repaid in full,” Phelps wrote. “Rising U.S. interest rates will push many over the edge by making their debt payments suddenly more expensive, for no fault of their own. We need urgent debt cancellation so that countries can prioritize recovery from the multiple crises they face.”

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 6th, 2022 by Vbiz

Asian equities tumbled Friday following a rout on Wall Street fueled by worries over rising interest rates and surging inflation, while the pound extended losses the day after taking a beating on fears of a U.K. recession.

Global markets have been battered this year by a series of crises including surging inflation, rising interest rates, China’s economic slowdown and the war in Ukraine.

There was some relief after the Federal Reserve on Wednesday lifted borrowing costs 50 basis points — the most since 2000 — but suggested a feared 75-point lift was not on the agenda for now.

However, U.S. traders ran for the hills Thursday as they contemplated a period of fierce monetary tightening by the U.S. central bank as it struggles to contain inflation running at a more than 40-year high.

The Nasdaq — dominated by tech firms particularly sensitive to higher rates — lost 5%, while the Dow and S&P 500 fell more than 3%.

“Valuations become even more sensitive, very sensitive, when rates are going up and that is what we are experiencing,” Kristina Hooper, at Invesco, told Bloomberg Television.

“It’s just getting exacerbated as we get into the thick of monetary-policy tightening in the U.S.”

That sell-off filtered through to Asia, where Hong Kong tanked more than 3% as tech firms took a hit. Meanwhile, the European Chamber of Commerce in the city called the finance hub’s stringent pandemic travel restrictions and frequent flight bans a “nightmare” for businesses.

The remarks come a week after the Australian Chamber of Commerce recommended that Hong Kong follow the lead of Singapore or Japan by lowering quarantine requirements for business travelers.

Shanghai, Sydney, Seoul, Singapore, Wellington, Taipei and Manila also tanked. However, Tokyo ended the morning slightly higher.

Adding to the selling pressure was ongoing weakness in China’s economy caused by strict lockdowns and other containment measures as officials struggle to bring a COVID flare-up under control by sticking to a zero-COVID policy.

Various districts in Beijing told residents on Thursday to work from home, while Shanghai, the biggest city in the country, remains essentially shut down.

On currency markets the pound continued to struggle a day after plunging more than 2% in reaction to the Bank of England’s updated forecast that warned annual inflation would top 10% and the economy would contract later this year.

Crude rose after key oil producers led by Saudi Arabia and Russia refused to lift output more than their planned marginal increase as they weighed tight supply concerns caused by the Ukraine war.

“OPEC’s inability to ramp up production when desperately needed by the market is compounding an already dangerous supply deficit,” said Stephen Innes, of SPI Asset Management.

“This means geopolitical tensions will remain high, and while there are some demand-side risks at the moment, it seems likely that the threat of supply disruption will be the dominant driver at this time,” he said.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 6th, 2022 by Vbiz

A sharp sell-off left the Dow Jones Industrial Average more than 1,000 points lower Thursday, wiping out the gains from Wall Street’s biggest rally in two years, as worries grow that the higher interest rates the Federal Reserve is using in its fight against inflation will derail the economy. 

The benchmark S&P 500 fell 3.6%, marking its biggest loss in nearly two years, a day after it posted its biggest gain since May 2020. The Nasdaq slumped 5%, its worst drop since June 2020. The losses by the Dow and the other indexes offset the gains from a day earlier. 

“Yesterday’s sharp rally was not rooted in reality, and today’s dramatic selloff is a reversal of that misplaced exuberance,” said Ben Kirby, co-head of investments at Thornburg Investment Management. 

Wall Street’s breakneck day-to-day reversal reflects the degree of investors’ uncertainty and unease over the array of threats the economy is facing, starting with inflation running at the highest level in four decades, and how effective the Federal Reserve’s bid to tame higher prices by jacking up interest rates will be. 

On Wednesday, the Federal Reserve announced a widely expected half-percentage point increase in its short-term interest rate. Stocks bounced around following the move but then sharply rose as bond yields fell after Fed Chair Jerome Powell reassured investors by saying the central bank wasn’t considering shifting to more aggressive, three-quarter point rate hikes as the Fed continues with further rate increases in coming months. 

But whatever relief Powell’s remarks gave stock investors vanished Thursday. Stocks slumped and bond yields climbed. The yield on the 10-year Treasury note rose to 3.04%. Rising yields are sure to put upward pressure on mortgage rates, which are at their highest level since 2009. 

Investors remain uneasy about whether the Fed can do enough to tame inflation without tipping the economy, which is showing signs of slowing, into a recession. In addition to high inflation and rising interest rates, investors are grappling with uncertainty over lingering supply chain disruptions and geopolitical tensions. 

“The biggest issue is there are just a lot of moving parts and the unanswered question is to what extent as the Fed attempts to tame inflation will that result in economic slowing, and perhaps, a recession,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. 

The S&P 500 fell 153.30 points to 4,146.87, while the Nasdaq slid 647.16 points to 12,317.69. The Dow briefly skidded 1,375 points before closing down 1,063.09 points, or 3.1%, to 32,997.97. 

Smaller company stocks also fell sharply. The Russell 2000 fell 78.77 points, or 4%, to 1,871.15. 

 

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 5th, 2022 by Vbiz

The U.S. central bank, the Federal Reserve, raised its benchmark interest rate by a half percentage point on Wednesday and scaled back its support for the American economy, a pointed effort to curb surging inflation in the world’s largest economy.

The interest rate increase, pushing its federal-funds rate to a target range between 0.75% and 1%, was the largest since 2000, and could quickly ricochet through the U.S. economy, increasing borrowing rates for businesses and consumers alike, with the goal of curbing spending and cutting inflation. The Fed usually increases interest rates in quarter-point increments.

The cost of consumer goods has been spiraling for months in the U.S., and an 8.5% year-over-year increase was recorded in March, the biggest jump in four decades. U.S. consumers are paying sharply higher prices for food, housing and gasoline at service stations, squeezing family budgets.

Aside from increasing the interest rate, the Fed said that starting next month it would scale back its $9 trillion asset portfolio in another move to curb inflation.

After a two-day meeting in Washington, the Fed said in a statement, “The invasion of Ukraine by Russia is causing tremendous human and economic hardship. The implications for the U.S. economy are highly uncertain.”

It added, “The invasion and related events are creating additional upward pressure on inflation and are likely to weigh on economic activity. In addition, COVID-related lockdowns in China are likely to exacerbate supply chain disruptions” in world trade.

After the meeting, Fed chairman Jerome Powell said at a news conference that “inflation is much too high, and we understand the hardship it is causing.”

But he said the Federal Reserve has various measures it can take over the coming months to bring the inflation rate to the Fed’s 2% average target, but not so fast that it sends the U.S. economy into a recession.

Ahead of this week’s meeting, policymakers had already said they could raise interest rates several more times through the end of 2022 to slow the surge in consumer prices.

Posted in Бізнес, Нерухомість, Новини, Фінанси

May 4th, 2022 by Vbiz

Cars stuck on the assembly line. Delays in the delivery of dishwashers, refrigerators and game consoles. Consumers and businesses are feeling the pinch of the semiconductor shortage. The war in Ukraine could make the situation worse. Michelle Quinn reports.

Posted in Бізнес, Нерухомість, Новини, Фінанси