Month: May 2018

South Korea’s fourth-largest conglomerate, LG Group, said its Chairman Koo Bon-moo did Sunday. Koo, 73, had been struggling with an illness for a year, LG Group said in a statement. “Becoming the third chairman of LG at the age of 50 in 1995, Koo established key three businesses — electronics, chemicals and telecommunications — led a global company LG, and contributed to driving (South Korea’s) industrial competitiveness and national economic development,” LG said. A group official said Koo had been unwell for a year and had undergone surgery. The official declined to be named because of the sensitivity of the matter. Before its chairman’s death, LG Group had established a holding company in order to streamline ownership structure and begin the process of succession. Heir apparent Koo Kwang-mo is from the fourth generation of LG Group’s controlling family. He owns 6 percent of LG Corp and works as a senior official at LG Electronics Inc. The senior Koo’s funeral will be private at the request of the family, the company said. …

China and the United States said Saturday that they had reached consensus on steps to substantially reduce the U.S. trade deficit with Beijing. The announcement followed high-level talks in Washington and U.S. allegations that unfair Chinese trade practices meant the United States was buying far more from China than it sold there. China pledged to make “meaningful” increases in purchases of services and goods, particularly agricultural and energy items.  A statement from the White House said Washington would send a team of officials to China to work out details. It mentioned the importance of intellectual property protection and said the two sides would work to achieve a “level playing field in trade.” New York Senator Chuck Schumer, the Democratic minority leader, said the statement offered too few details. He said China often denies access to its huge market unless U.S. companies give Chinese firms access to American technical and business secrets. Schumer said short-term purchases of U.S. goods would not make up for that.  …

India and the European Union have given the World Trade Organization lists of the U.S. products that could incur high tariffs in retaliation for U.S. President Donald Trump’s global tariffs on steel and aluminum, WTO filings showed Friday. The EU said Trump’s steel tariffs could cost $1.5 billion and aluminum tariffs a further $100 million, and listed rice, cranberries, bourbon, corn, peanut butter, and steel products among the U.S. goods that it might target for retaliation. India said it was facing additional U.S. tariffs of $31 million on aluminum and $134 million on steel, and listed U.S. exports of soya oil, palmolein and cashew nuts among its potential targets for retaliatory tariffs. One trade official described the lists of retaliatory tariffs as “loading a gun,” making it plain to U.S. exporters that pain might be on the way. India said its tariffs would come into effect by June 21, unless and until the United States removed its tariffs. The EU said some retaliation could be applied from June 20. Trump’s tariffs, 25 percent on steel and 10 percent on aluminum, came into force in March to strong opposition as many see the measures as unjustified and populist. There were also objections that the tariffs would have little impact on China, widely seen to be the cause of oversupply in the market. Trump justified the tariffs by claiming they were for U.S. national security, in a bid to protect them from any legal challenge at the WTO, causing further controversy. Rather …

China has dropped an anti-dumping investigation and given long awaited approval for the sale of Toshiba’s memory chip business, in gestures that could suggest a thaw between Beijing and the U.S. as trade talks resumed in Washington. The Commerce Ministry said Friday ended the probe into imported U.S. sorghum because it’s not in the public interest. A day earlier, Beijing cleared the way for a group led by U.S. private equity firm Bain Capital to buy Toshiba Corp.’s computer memory chip business. The moves signaled Beijing’s willingness to make a deal with Washington amid talks between senior U.S. and Chinese officials aimed at averting a trade war between the world’s two biggest economies, analysts say. “I think China is willing to make concessions,” said Wang Tao, chief China economist at UBS. “The Chinese stance has been very clear, that China wants to mute any trade dispute. But of course it doesn’t mean China would heed to all the demands the U.S. would place.” A White House official said China had offered to work to cut the trade deficit with the U.S. by $200 billion, while stressing that the details remained unclear. But China’s Foreign Ministry denied it. “It’s untrue,” said spokesman Lu Kang. “The relevant discussion is still underway, and it is constructive.” The Commerce Ministry said it was ending the anti-dumping probe and a parallel anti-subsidy investigation because they would have raised costs for consumers. The U.S. is China’s biggest supplier of sorghum, accounting for more than 90 percent …

The European Commission is proposing that EU governments make direct money transfers to Iran’s central bank to avoid U.S. penalties, an EU official said, in what would be the most forthright challenge to Washington’s newly reimposed sanctions. The step, which would seek to bypass the U.S. financial system, would allow European companies to repay Iran for oil exports and repatriate Iranian funds in Europe, a senior EU official said, although the details were still to be worked out. The European Union, once Iran’s biggest oil importer, is determined to save the nuclear accord, that U.S. President Donald Trump abandoned on May 8, by keeping money flowing to Tehran as long as the Islamic Republic complies with the 2015 deal to prevent it from developing an atomic weapon. “Commission President Jean-Claude Juncker has proposed this to member states. We now need to work out how we can facilitate oil payments and repatriate Iranian funds in the European Union to Iran’s central bank,” said the EU official, who is directly involved in the discussions. The U.S. Treasury announced on Tuesday more sanctions on officials of the Iranian central bank, including Governor Valiollah Seif,. But the EU official said the bloc believes that does not sanction the central bank itself. European Energy Commissioner Miguel Arias Canete will discuss the idea with Iranian officials in Tehran during his trip this weekend, the EU official said. Then it will be up to EU governments to take a final decision. EU leaders in Sofia this week …

Switzerland’s government has requested a report into the risks and opportunities of launching its own cryptocurrency, a so-called “e-franc” that would use technology similar to privately launched coins like bitcoin but have backing of the state. The lower house of the Swiss parliament must now decide whether to back the Federal Council’s request for a study into the subject, which has been discussed in Sweden. Cryptocurrencies have drawn scrutiny from lawmakers and international governing bodies coming to grips with the technology’s rapid ascent. The coins use encryption and a blockchain transaction database designed to enable anonymous transactions that do not require centralized processing. Other countries interested Several countries have begun evaluating the viability of introducing their own state-backed digital currency, with Sweden’s Riksbank saying an e-crown might help counteract issues arising from declining cash use and help make payment systems more robust. But existing digital currencies such as bitcoin have been hampered by extreme volatility, high-profile hacks and doubts about long-term viability. Venezuela has issued a state-backed coin, but major developed economies have so far steered clear. The Bank of International Settlement in March warned central banks to think hard about potential risks and spillovers before issuing their own cryptocurrencies. Swiss bank cautious In Switzerland, if the proposal is approved, a study will be produced by the Swiss finance ministry. No timing has been given on when it would be published should the go-ahead be given. Swiss lawmaker Cedric Wermuth, vice president of the Social Democratic Party, called for the …

The United States sought on Thursday to further choke off funding sources for Iranian-backed Hezbollah, imposing sanctions on its representative to Iran, as well as a major financier and his five companies in Europe, West Africa and the Middle East. The U.S. Treasury said Mohammad Ibrahim Bazzi was a Hezbollah financier operating through Belgium, Lebanon and Iraq, and was a close associate of Gambia’s former president Yahya Jammeh, who is accused of acquiring vast wealth during his decades-long rule. It also imposed sanctions on Hezbollah’s representative to Iran, Abdallah Safi Al-Din, who it said served as an interlocutor between Hezbollah and Iran on financial issues. The department said it had blacklisted Belgian energy services conglomerate Global Trading Group; Gambia-based petroleum company Euro African Group; and Lebanon-based Africa Middle East Investment Holding, Premier Investment Group SAL Offshore and import-export group Car Escort Services. All were designated because they are owned or controlled by Bazzi, the Treasury said. “The savage and depraved acts of one of Hezbollah’s most prominent financiers cannot be tolerated,” U.S. Treasury Secretary Steven Mnuchin said in a statement. “This administration will expose and disrupt Hezbollah and Iranian terror networks at every turn, including those with ties to the Central Bank of Iran,” he said. The sanctions are among a slew of fresh measures aimed at Iran and Hezbollah since U.S. President Donald Trump withdrew from the Iran nuclear deal last week. U.S. Secretary of State Mike Pompeo is set to outline in a speech in Washington on Monday …

The United Nations is forecasting that the global economy will expand by more than 3 percent this year and next year — but it warns that increasing risks could trigger “a shock to investment and trade” and a sharp drop to 1.8 percent growth in 2019.   The U.N.’s mid-year report on the World Economic Situation and Prospects launched Thursday says growth in the world economy is surpassing expectations, reflecting further economic expansion in developed countries and broadly favorable investment conditions.   However, the report said, “downside risks” have increased including “a rise in the probability of trade conflicts between major economies.”   Dawn Holland, chief of the U.N.’s Global Economic Monitoring Branch, cited the Trump administration’s imposition of tariffs in January and proposed new tariffs against China as well as the renegotiation of the U.S. trade agreement with Mexico and Canada, which has left “a void of uncertainty.”   There are also negotiations between the European Union and the United States partly linked to tariffs on steel, she said, and an increasing number of disputes have been raised with the World Trade Organization over the last six months.   The report said other factors also pose risks including uncertainty over monetary policy, increasing debt levels, and greater geopolitical tensions including in the Korean peninsula, Middle East, South China Sea and Ukraine.   But the U.N.’s assessment was generally upbeat citing continued economic improvements over the last several months including accelerating wage growth, improved investment prospects, and the short-term impact …

U.S. officials and politicians say they are increasingly frustrated and looking for ways to fight back against what they see as China’s use of its market power to impose “politically correct” behavior on American companies. Airlines, retailers and hoteliers all have been pressured to alter products and promotions that offended Beijing. “These actions are outrageous and disturbing,” Deputy Assistant Secretary of State for East Asian and Pacific affairs Alex Wong told American lawmakers Tuesday. “China is very much well aware that it’s wading through treacherous waters here. And they understand that if they continue along this path, continue to employ these tactics, that will negatively affect the U.S.-China relationship and that there will be consequences,” said Wong during a hearing at Senate Foreign Relations subcommittee on East Asia, The Pacific, and International Cybersecurity Policy. “The consequences are under review,” Wong added. His remarks come after American clothing retailer Gap apologized and recalled the sale in the Chinese market of its T-shirts showing a map that’s seen by Beijing as politically incorrect. The T-shirts were also destroyed.  A Chinese student earlier this week posted pictures of the T-shirt, which did not include Taiwan, parts of Tibet and islands in the South China Sea that Beijing claims are Chinese territories. Gap quickly apologized, citing “unintentional error.” Photos circulated on Chinese social media network Weibo were said to be have been taken at an outlet store in Canada.  A Chinese government spokesperson took note of Gap’s apology and the American company’s pledge to …

President Donald Trump stepped into a round of tough trade talks with China on Thursday after the White House confirmed a meeting between the U.S. president and Chinese Vice Premier Liu He. The two world powers are taking part in a second series of trade negotiations that started Thursday. The initial talks were held in Beijing two weeks ago. Speaking to reporters before his meeting with Liu, Trump repeated his strong dislike for previous deals between Washington and Beijing. “The United States has been ripped off for many, many years by its bad trade deals. I don’t blame China; I blame the leadership of this country from the past,” Trump told reporters before a meeting with NATO Secretary-General Jens Stoltenberg. “China has taken out hundreds of billions of dollars a year from the United States, and I explained to President Xi [Jinping] we can’t do that anymore,” Trump added. The talks are aimed at “rebalancing the United States-China bilateral economic relationship,” according to the White House. They are also aimed at avoiding a full-blown trade war after the two countries exchanged tariff threats in March. Despite the tough talks, Trump tweeted over the weekend that he was working with Xi to give Chinese phone company ZTE a way to get back into business. The U.S. slapped sanctions against the Chinese telecommunications company last month for breaking U.S. trade control laws by selling components to Iran and North Korea. The move prompted ZTE to shut down its U.S. operations. U.S. law enforcement and intelligence communities …

The European Commission will initiate plans Friday to prohibit European companies from adhering to U.S. sanctions against Iran, a move to help keep the Iran nuclear agreement intact and to defend European corporate interests. “We have the duty to protect European companies,” Commission President Jean-Claude Juncker said following a meeting of European Union leaders Thursday in Sofia, Bulgaria, “We now need to act and this is why we are launching the process.” Juncker said the commission will begin the process of activating a so-called blocking statute, which bans EU companies from observing the sanctions and any court rulings that enforce U.S. penalties. Juncker also said the commission would continue to cooperate with Iran and the European Investment Bank would be allowed to facilitate European corporate investment in the Persian Gulf country. The commission’s move is in retaliation to U.S. President Donald Trump’s decision to withdraw from the Iranian nuclear deal and a subsequent move to revive stringent sanctions against Tehran. The U.S. actions sparked concern among European countries over how to incentivize Iran to maintain compliance with the accord signed by world powers in July 2015, and the blocking statute is the most powerful tool at its immediate disposal. European leaders are also confronted with the threat of U.S. tariffs on European steel and aluminum exports. The Trump administration’s temporary exemptions from the tariffs expire June 1.     …