Month: May 2018

Venezuela’s state-run oil firm PDVSA has bought nearly $440 million worth of foreign crude and shipped it directly to Cuba on friendly credit terms — and often at a loss, according to internal company documents reviewed by Reuters. The shipments are the first documented instances of the OPEC nation buying crude to supply regional allies instead of selling them oil from its own vast reserves. Venezuela made the discounted deliveries, which have not been previously reported, despite its dire need for foreign currency to bolster its collapsing economy and to import food and medicine amid widespread shortages. The open-market oil purchases to subsidize one of Venezuela’s few remaining allies underscores its increasing global isolation and the disintegration of its energy sector under socialist President Nicolas Maduro. The purchases came as Venezuela’s crude production hit a 33-year low in the first quarter — down 28 percent in 12 months. Its refineries are operating at a third of capacity, and its workers are resigning by the thousands. PDVSA bought the crude for up to $12 per barrel more than it priced the same oil when it shipped to Cuba, according to prices on internal documents reviewed by Reuters. But Cuba may never pay cash for the cargoes because Venezuela has long accepted goods and services from Cuba in return for oil under a pact signed in 2000 by late presidents Hugo Chavez and Fidel Castro. PDVSA, the Venezuela government and the Cuba government did not respond to requests for comment. Venezuela’s government …

The head of the United Nations World Food Program (WFP) on Tuesday said the North Korean leadership is hopeful that following a possible denuclearization deal, the international community will increase humanitarian aid for millions of people in the country who are living in poverty and suffering from malnutrition. “There is a tremendous sense of optimism by the leadership, by the people I met with, in the hopes that they will be turning a new chapter in their history, a new page,” said David Beasley, the Executive Director of the WFP during a briefing in Seoul. The WFP director visited North Korea for four days last week, spending two days in Pyongyang and two visiting rural areas outside the capital. Beasley said he was given “remarkable” access during his visit to the restrictive state where contact with foreigners is tightly controlled. Government minders also accompanied him during his visit. Beasley, a former governor of the U.S. state of South Carolina, was nominated to head the WFP last year by U.S. Ambassador to the U.N. Nikki Haley, who is also a former South Carolina governor. With the upcoming summit between U.S. President Donald Trump and North Korean leader Kim Jong Un now scheduled to be held in Singapore on June 12, there are increased expectations that an agreement will be reached to dismantle the North’s nuclear, missile and chemical weapons programs that threaten the U.S. and its allies. Details over the scope and timing of the denuclearization process must still be worked …

Even before US and Chinese officials sit down this week for a second round of high-level trade talks in Washington, both sides have been signaling a willingness to try and make a deal or at least meet the other halfway. Whether or not that will be enough to get them across the finish line remains to be seen, analysts say. Late last week at a forum sponsored by the Center for Strategic and International Studies in Washington D.C., Chinese Ambassador Cui Tiankai signaled China’s willingness to address a range of issues from the deficit to the protection of intellectual property rights. Deficit detente Cui said that while it is overly simplistic to say trade deficit means loss and surplus means gain, there is a clear need for better macroeconomic coordination between the two countries. “A huge deficit for you and a huge surplus for us – I don’t think this should continue,” he said. “I don’t think it will continue. For us, such an imbalance is already a problem rather than a benefit.” When Treasury Secretary Steven Mnuchin and China’s Vice Premier Liu He led trade delegations earlier this month in Beijing, the deficit loomed large. A leaked list of some of Washington’s demands included a request that China help cut the trade deficit between the two countries by $100 billion a year over the next two years. Many have scoffed at the figure and the possibility that Beijing could bridge such a seemingly huge gap, but Cui’s remarks are …

In a warehouse on the outskirts of Indonesia’s capital, supervisors at e-commerce company Lazada use bikes or electric scooters to zip around a floor the size of four soccer fields, where up to 3,000 staff pack and dispatch goods around the clock. The warehouse is one of five that Lazada has opened across Indonesia to cut costs and expand its reach in an archipelago whose 17,000 islands are sprinkled across an area bigger than the European Union. Chinese tech firms, including Lazada’s top investor, Alibaba Group Holding, have poured at least $6 billion into nearly every aspect of Indonesian e-commerce. Lazada uses Alibaba’s inventory management systems and has tied up with ride-hailing companies, often using their motorbikes to deliver goods in a country with creaking infrastructure and traffic-clogged cities. The payoff could be huge. It is a market forecast to grow from about $7 billion last year to $63 billion by 2027, according to Morgan Stanley. “Indonesia, both in terms of the customers and behavior, is a very unique challenge and we need to adapt,” Florian Holm, co-chief executive at Lazada Indonesia, told Reuters. Lazada and Tokopedia, in which Alibaba is also an investor, dominate Indonesia in customer traffic, with more than 117 million monthly website visits each, according to data from e-commerce aggregator iPrice. Alibaba doubled its investment in loss-making Lazada to $4 billion in April, underscoring its global ambition to secure a bigger share of the e-commerce market. Between the investment and the rewards, however, lie enormous complexities. …

People nixing vacations to Hawaii’s Big island has cost the tourism industry millions of dollars as the top attraction, Kilauea volcano, keeps spewing lava. Cancellations from May through July have hit at least $5 million, said Ross Birch, executive director of the island’s tourism board. The booking pace for hotels and other activities, such as tours for lava viewing, zip lines and glass bottom boats have fallen 50 percent. A handful of cruise ships have also decided not to come into port even in Kona on the west side of the island, about 80 miles (129 kilometers) away from the volcano. This is the “first leak we’re seeing out of the bucket,” Birch said. Tourism is one of Hawaii’s biggest industries and a big part of the local economy. The Big Island topped other islands in the archipelago pulling in $2.5 billion in revenue last year.  On Monday, another fissure spewing lava and unhealthy gas opened up, and a crack in the Earth that emerged a day earlier was sending molten rock on a slow run for the ocean, officials said. The National Weather Service has warned residents of “light ashfall” throughout the day in Kau, the island’s southernmost district, after a burst of volcanic emissions around 9 a.m.  Nearly 20 fissures have opened since the Kilauea volcano started erupting 12 days ago, and officials warn it may soon blow its top with a massive steam eruption that would shoot boulders and ash miles into the sky.  A fissure that …

Uber Technologies’ growth has slowed as a series of scandals has allowed the ride-hailing company’s chief U.S. competitor, Lyft, to grab more market share, digital research firm eMarketer said in a report on Monday. The research firm has lowered its forecasts for Uber’s growth for the next several years. It projects 48 million U.S. adults will use Uber at least once this year, up 18 percent from last year but well off eMarketer’s earlier forecast of more than 51 million. EMarketer based its analysis on data from Uber and Lyft, such as trip numbers and app downloads, as well as customer surveys from researchers at JP Morgan and other firms. Series of scandals The report quantifies the effect of a series of scandals at Uber last year, which included an internal probe of sexual harassment and workplace behavior; a U.S. Department of Justice investigation into whether Uber managers violated U.S. laws against bribery of foreign officials; a lawsuit by Alphabet alleging trade secrets theft that Uber settled for $245 million; and the departure of Uber’s chief executive officer, who was pushed out by investors concerned about the growing list of problems. Uber did not respond to a request for comment. Meanwhile, Lyft has grown quickly, adding more than 160 cities last year, benefiting from Uber’s tarnished image and as a later entry into markets where people are already familiar with ride-hailing services, eMarketer said. On Monday, Lyft said it has 35 percent of the national ride-hailing market, and in 16 …

The European Union on Monday warned Britain time was running out to seal a Brexit deal this fall and ensure London does not crash out of the bloc next March, adding to pressure on Prime Minister Theresa May. May’s spokesman, however, said the “focus is on getting this right” rather than meeting a deadline. The EU’s Brexit negotiator Michel Barnier told 27 ministers of the bloc meeting in Brussels on Monday that “no significant progress” had been made in negotiations with London since March, the Bulgarian chairwoman of the talks said. Diplomats and officials in Brussels have raised doubts about whether the bloc and London will be able to mark a milestone in the negotiations at the summit of EU leaders on June 28-29. The current schedule puts progress in June as an important step towards a final Brexit deal in October, which would leave enough time for an elaborate EU ratification process before the Brexit day. “October is only five months from now and still some key issues related to the withdrawal agreement need to be settled. In June we need to see substantive progress on Ireland, on governance and all remaining separation issues,” said Deputy Prime Minister Ekaterina Zakharieva of Bulgaria, which holds the EU’s rotating presidency. ‘No clear stance’ German, Austrian and Dutch ministers all echoed the same concern, saying Britain has not made its position clear in detail on parts of the negotiations. “We are concerned that there is no clear stance, no clear position from …

Investors looking to buy Venezuela’s new cryptocurrency may want to head to a little-known Moscow bank whose biggest shareholders are President Nicolas Maduro’s socialist government and two state-controlled Russian companies under U.S. sanctions. Evrofinance Mosnarbank has emerged as the only international financial institution so far willing to defy a U.S. campaign to derail the world’s first state-backed digital currency, called the petro, even before it begins to function. Early would-be investors who registered with Venezuela’s government and downloaded the petro’s wallet software — available in Spanish, English and Russian — were then invited to buy the cryptocurrency by wiring a minimum of 1,000 euros to a Venezuelan government account at Evrofinance. The bank’s place in the rollout of the petro is further evidence of Russia’s role in the creation of a cryptocurrency that much of the digital world has shunned but that Maduro hopes will allow Venezuela to circumvent U.S. financial sanctions imposed last year. At the petro’s launch on Feb. 21, Maduro heaped praise on two Russians in the audience who worked with wealthy, Kremlin-connected businessmen, thanking their previously unknown startups — Zeus Exchange and Aerotrading — for their role developing what he joked would be a kind of “kryptonite” against U.S. economic dominance. A day later, he dispatched his economy minister to Moscow to brief his Russian finance counterpart. And in March, the Russian Association of Cryptocurrency and Blockchain awarded the Venezuelan government an award for its role “challenging the de-facto powers of the international financial system.” ‘Fighting …

In South Africa, workers will soon begin construction of a new 100 megawatt solar power plant near the town of Pofadder. In Morocco, expansion of a giant solar power plant near the city of Ourzazate will soon increase its capacity to 580 megawatts. Solar energy has been slower to arrive in West Africa, but  growth is underway. West Africa’s largest solar power station was officially opened in November 2017. It’s at Zagtouli, on the outskirts of Burkina Faso’s capital Ouagadougou. It cost $55 million to build; the money came from France and the European Union. Zagtouli now delivers 30 megawatts to the national power grid. Before Zagtouli, this was West Africa’s largest, at Bokhol, in Senegal. It opened in 2016, cost $30 million to build but the money story here is different. Charlotte Aubin, founder and director of Greenwish, a renewable energy company, was closely involved. She helped create the first Independent Power Producer, or IPP, with money from Senegalese investors and an international fund backed by three European governments. “The first project we did was in Senegal and it was a milestone for the continent as well as Greenwish,” said Aubin. “It was the first solar IPP that came out of the ground in Sub-Saharan Africa. It’s now providing electricity to 160,000 people in Senegal at a 40 percent discount to the cost of the grid at the time.” Forty percent less? How is that possible? Moussa Coulibaly, who runs Air Com, one of Mali’s oldest solar power companies, …

Bailout inspectors have returned to Athens as Greece races to comply with the final terms of its rescue program, which ends in August. Negotiations resumed Monday, with Greece still facing dozens of measures to address in the next ten days to remain on track for an agreement next month on the terms of bailout debt repayment after the program ends. Athens is seeking a full return to financing itself on international bond markets following eight years of dependence on loans from other eurozone countries and the International Monetary Fund. But some creditors favor a more gradual approach. Among the economic measures still under discussion are protections for families facing home repossession and an end to sales-tax exemptions in areas affected by the refugee crisis. …

Some of the biggest automakers in Europe are joining forces to build a highway network of fast-charging stations they hope will boost sales of electric vehicles. The idea is to let drivers plug in, charge in minutes instead of hours, and speed off again — from Norway to southern Italy, and Portugal to Poland.   Much is at stake for the automakers, which include Volkswagen, BMW, Daimler and Ford. Their joint venture, Munich-based Ionity, is pushing to roll out its network in time to service the next generation of battery-only cars coming on the market starting next year from Volkswagen’s Porsche and Audi, BMW and Daimler.   They’re aiming to win back some of the market share for electric luxury car sales lost to Tesla, which has its own, proprietary fast-charging network.     …

President Donald Trump says he is looking for a way to let a Chinese technology firm “get back into business fast” after U.S. trade ruling severely crippled the company. “Too many jobs in China lost,” Trump tweeted Sunday, days after ZTE announced it had ceased “major operating activities.” The U.S. had cut off exports of U.S.-made parts to ZTE — more than 25 percent of the components ZTE needs to build its wireless stations, optical fiber networks and smartphones. The U.S. cutoff came after ZTE was, in the words of one expert, “caught red-handed” putting the U.S. technology into products and selling those goods to countries under a U.S. trade embargo, including Iran and North Korea. The U.S. fined ZTE $1.2 billion last year. But the U.S. said last month ZTE lied about punishing the employees believed to be involved in skirting the sanctions, paying them bonuses instead. The Commerce Department cut off ZTE’s access to U.S. components until 2025, forcing it to shut down operations at its factory in Shenzhen. Trump has often complained about China stealing U.S. jobs. But he tweeted he is working with Chinese President Xi Jinping to ease the economic fallout at ZTE and ordered the U.S. Commerce Department “to get it done!” “The president’s tweet underscores the importance of a free, fair, balanced, and mutually beneficial economic trade and investment relationship between the United States and China,” the White House said Sunday. “The administration is in contact with China on this issue, among others, …