Month: July 2018

Turkish Foreign Minister Mevlut Cavusoglu on Tuesday ruled out his country’s compliance with U.S. sanctions on Iran, a move that threatens to exacerbate tensions between the NATO allies. “We have told them we will not join these sanctions,” said Cavusoglu, referring to a meeting last Friday with senior U.S. officials in Ankara. “While we are explaining why we will not obey these sanctions, we have also expressed that we do not find these U.S. sanctions appropriate.” Ankara strongly opposes U.S. President Donald Trump’s decision to impose sanctions after pulling out of an international agreement with Iran on its nuclear energy program. Stringent sanctions are to start taking effect at the end of August, with measures against Iranian energy exports beginning in November. Energy-hungry Turkey is heavily dependent on its Iranian neighbor for oil and natural gas, while Turkish businesses are eyeing Iran as an increasingly important market. On Friday, Marshall Billingslea, assistant secretary of the Treasury for terrorist financing, visited Ankara to meet with Turkish officials and business representatives. Billingslea described the talks as “positive” and acknowledged the difficulties faced by Turkish companies, but warned, “The Treasury sanctions will be enforced very, very aggressively and very comprehensively.” Washington says no to any waivers for countries trading with Iran, which puts it on a collision course with Ankara. “We’ve seen this in the past. Turkey will not comply with U.S. sanctions. It will not stop importing Iranian gas and oil,” said Sinan Ulgen, head of the Istanbul-based Edam research institution. “Maybe …

U.S. President Donald Trump’s oldest daughter, Ivanka Trump, is closing her fashion line to focus her energies on advising her father’s White House, she said through a representative on Tuesday. Trump, whose fortune comes from real estate development, came into office carrying a broad family business portfolio that trades heavily on the family name. The president has made regular visits to Trump-branded properties during his time in office, prompting some critics to complain that he is using the profile of his office to promote his private businesses. “After seventeen months, without a time frame for her return, Ivanka made the difficult decision that to be fair to the brand’s partners and its employees, the business should be wound down,” a representative for Ivanka Trump’s fashion line said in a statement on Tuesday. The company said licensing contracts would not be renewed and those in place will be allowed to run their course. Trump’s combative style on the campaign trail and as president have drawn the family’s brands into political fights, with some supporters hosting events at the luxury Trump International Hotel blocks from the White House while opponents have called for boycotts of the family’s businesses. In early 2017 retailers including Nordstrom Inc, Sears Holdings Corp and Kmart dropped or sharply scaled back their assortment of Trump-branded products, though they typically attributed those decisions to poor sales rather than political messages. Ivanka Trump’s brand said in a statement that retailers including Bloomingdale’s, owned by Macy’s Inc, Dillard’s and Amazon.com continued …

Britain and the European Union formally filed for divorce at the World Trade Organization on Tuesday, following many months of diplomatic preparations to smooth the way for the historic move. The WTO circulated two confidential draft membership agreements among the Geneva trade club’s 164 members, separating Britain’s rights and obligations in merchandise trade from the EU’s for the first time in the WTO’s 23-year history. A separate split of services trade is expected to follow. “It seeks to replicate the concessions and commitments applicable to the U.K. as part of the EU today. An important milestone as we prepare for our departure from the EU,” British Ambassador Julian Braithwaite wrote in a tweet. Britain’s draft document, officially known as its “schedule,” is 719 pages long. “WTO members will have three months to review the schedule, which will be considered to be approved if there are no objections from other members,” the WTO said in a statement. Until now the EU has represented Britain at the WTO, and Britain’s membership rights were not set out distinctly, even though Britain was always a WTO member in its own right. Its June 2016 decision to leave the EU meant disentangling their trade rules to allow Britain to act independently. Britain’s government says that only minimal changes will be needed in the text and it does not expect any difficulties, apart from potentially in agriculture. Seven agricultural suppliers – including the United States, Canada and Australia -have already said they disapprove of the terms …

Bulgaria’s president on Tuesday vetoed controversial amendments to a privatization law that critics say could cost the country lost revenues. The changes — approved by parliament, dominated by center-right GERB party, last Wednesday — would cut in half, to five years, the time that buyers would have to fulfill specific obligations under a privatization contract. But former air force commander Rumen Radev, who won the presidency in November 2016 as an independent, said the proposed changes “do not serve interests of the state and Bulgarian citizens.” Radev said the time to meet obligations should be determined by the type of business being privatized, rather than through legal provisions that create an advantage for the buyer at the expense of the public interest. “The law will entail a review of privatization contracts that is detrimental to the state and society,” he said. Radev’s move followed an announcement by disgruntled citizens that a three-day protest against the new changes would be staged in capital Sofia. Parliament may easily overrule Radev’s veto by at least 121 votes in the 240-seat assembly. However, Prime Minister Boyko Borissov, eager to mute public discontent in one of the European Union’s poorest countries, reacted quickly and ordered his ruling GERB party to draw up and submit a new amendment to the law that would eliminate any suspicions of lobbying. Analysts and politicians, including Deputy Prime Minister Valeri Simeonov strongly criticized the “lobbyist” revisions, saying they would allow ship building and repair company Navibulgar to avoid paying 58 …

U.S. President Donald Trump spoke warmly of Mexico’s incoming leftist president on Monday, saying he expected to get “something worked out” on NAFTA, while a top Mexican official said there was scope to revive the trade talks this week. “We’re talking to Mexico on NAFTA, and I think we’re going to have something worked out. The new president, terrific person,” Trump said in a speech at the White House about American manufacturing. “We’re talking to them about doing something very dramatic, very positive for both countries, he said, without giving more details. Talks to reshape the 1994 trade accord have been underway since last August. But they stalled in the run-up to the July 1 presidential election in Mexico, which produced a landslide victory for veteran leftist Andres Manuel Lopez Obrador. The United States, Mexico and Canada have been at odds over U.S. demands to impose tougher content rules for the auto industry, as well as several other proposals, including one that would kill NAFTA after five years if it is not renegotiated. Mexican Economy Minister Ildefonso Guajardo, who last week expressed hope an agreement in principle on NAFTA could be reached by the end of August, is due to hold talks with U.S. Trade Representative Robert Lighthizer at the end of the week in Washington. He will be accompanied by Jesus Seade, the designated chief NAFTA negotiator of the incoming Mexican administration. “There’s clearly a window of opportunity to be able to bed down a series of open issues …

Inflation in Venezuela could top 1 million percent by year’s end as the country’s historic crisis deepens, the International Monetary Fund said Monday. Venezuela’s economic turmoil compares to Germany’s after World War I and Zimbabwe’s at the beginning of the last decade, said Alejandro Werner, head of the IMF’s Western Hemisphere department. “The collapse in economic activity, hyperinflation, and increasing deterioration … will lead to intensifying spillover effects on neighboring countries,” Werner wrote in a blog post. The once wealthy oil-producing nation of Venezuela is in the grips of a five-year crisis that leaves many of its people struggling to find food and medicine, while driving masses across the border for relief into neighboring Colombia and Brazil. Shortages in electricity, domestic water and public transportation plague millions of Venezuelans, who also confront high crime, the IMF noted. If the prediction holds, Venezuela’s economy will contract 50 percent over the last five years, Werner said, adding that it would be among the world’s deepest economic falls in six decades. Socialist President Nicolas Maduro often blames Venezuela’s poor economy on an economic war that he says is being waged by the United States and Europe. Maduro won a second six-year term as president despite the deep economic and political problems in a May election that his leading challenger and many nations in the international community don’t recognize as legitimate. The IMF estimates Venezuela’s economy could contract 18 percent this year, up from the 15 percent drop it predicted in April. This will …

Checking out a speedboat, a fighter jet and a giant industrial magnet parked on the White House driveway, President Donald Trump showcased an array of “Made in America” products Monday as his administration pushes back aggressively against critics who say his punishing tariffs on imported goods threaten to harm the U.S. economy. Trump’s event with a smorgasbord of American goods came at the start of a week in which trade discussions are expected to dominate, including talks with European officials and a trip to Illinois in which the president is planning to visit a community helped along by his steel tariffs. Trump has vowed to force international trading partners to bend to his will as he seeks to renegotiate a series of trade deals he has long argued hurt American workers. But as he deepens the U.S. involvement in trade fights, it raises questions on whether American consumers will feel the pain of retaliatory tariffs — and whether the president will incur a political price for his nationalistic trade policies in the 2018 midterm elections. “Our leaders in Washington did nothing, they did nothing. They let our factories leave, they let our people lose their jobs,” Trump said at the White House. “That’s not free trade, that’s fool’s trade, that’s stupid trade and we don’t do that kind of trade anymore.” Trump noted that he would be meeting Wednesday with European officials, including European Commission President Jean-Claude Juncker. The U.S. and European allies have been at odds over the president’s …

International investors are looking to Tuesday’s meeting of the Turkish central bank as a critical test of whether the bank can remain independent of President Recep Tayyip Erdogan, his increasing powers, and what some criticize as his Islamist agenda. The Turkish currency has fallen sharply as concerns mount on whether he will impose unorthodox economic policies on the bank. Erdogan, who has called for Islamic banks to make up a quarter of the country’s banking sector, strongly opposes interest rates and has described them as “the mother and father of all evil.” The president rejects economic orthodoxy that increasing rates reduces inflation. Investors are looking to the Turkish central bank meeting to hike rates to rein in rampant inflation, currently running at over 15 percent — among the highest in the developed world. “If the central bank cannot find the opportunity to hike, then the markets will take it very negatively,” economist Inan Demir of Nomura Securities said. “If it can hike then the market will see this as the first market-friendly action by the new administration.” Investors’ concerns saw the Turkish lira plunge about 30 percent since the start of the year. Adding to the unease is Erdogan’s move to assume sweeping executive powers after last month’s presidential elections. During his campaign, Erdogan pledged to take greater control over the economy, including the independent central bank. The appointment of his son-in-law, Berat Albayrak, as Turkey’s finance minister has further raised international investor concerns. In the past, Albayrak voiced support …

Amid escalating trade friction with the United States, China appears to be courting Europe to fill the gaps in providing opportunities for technology transfers. Analysts, however, are urging Europe to be wary in its dealings with China. They say it will be political and economically unwise for Europe to take advantage of the Sino-U.S. dispute and allow China to continue unfair trade practices that include forced tech transfers and intellectual property theft.   The U.S. has accused China of using “state-led efforts to force, strong-arm and even steal U.S. technology and intellectual property.” Rob Atkinson, who heads the Washington, D.C.-based Information Technology & Innovation Foundation (ITIF), says Europe should stop cutting deals with China that he says will offset the Trump administration’s efforts to punish Beijing. In early July, the U.S. launched a first round of tariffs on $34 billion of Chinese goods. China’s tariffs on $34 billion of U.S. imports, including soybeans, also took effect at the same time. U.S. President Donald Trump last week vowed to impose tariffs on all $505 billion worth of Chinese imports. China has vowed to retaliate if the U.S. slaps more tariffs on Chinese goods in the coming months. The U.S. and China are the world’s two biggest economies. Made in China 2025   China’s tech ambition, unveiled in its “Made in China 2025” program, is believed to be at the core of its trade war with the U.S. To avoid upsetting Washington, China has downplayed the initiative, which was first introduced in …

European Commission President Jean-Claude Juncker will not arrive in the United States for talks with U.S. President Donald Trump with a specific trade offer, the Commission said on Monday. Juncker will travel to Washington on Wednesday for talks focused on trade tensions after the U.S. imposition of tariffs on EU steel and aluminum and Trump’s threats to extend those measures to European cars. Trump’s top economic adviser, Larry Kudlow, has said he expected Juncker to come with a “significant” trade offer, but the Commission on Monday that would not happen. “I do not wish to enter into a discussion about mandates, offers because there are no offers. This is a discussion, it is a dialogue and it is an opportunity to talk and to stay engaged in dialogue,” Commission spokesman Margaritis Schinas told a news conference. Trump has repeatedly complained about the European Union, pointing to the higher duties it applies for car imports and describing the bloc as a “foe” in trade. EU officials have said that, while EU import duties for cars are heavier than those of the United States, for other products, such as trucks, U.S. rates are higher. They also say cutting duties for cars could only be part of a broader trade deal. European Trade Commissioner Cecilia Malmstrom, who will accompany Juncker, said last week that the European Union was preparing a list of U.S. products to hit if the United States imposed tariffs on EU cars. Schinas said Juncker was “very prepared” to set …

“Heightened trade and geopolitical tensions” are putting global economic growth at risk, G-20 finance ministers said after two days of meetings in Buenos Aires on Sunday. In their final communique, the Group of 20 ministers stressed the need to “step up dialogue and actions to mitigate risks and enhance confidence.” The ministers, representing industrial and emerging-market nations, described the overall world economic growth as “robust,” but expressed concerns over what they call the increased risks of the “short and medium term.” They did not mention the United States by name in their closing statement. But some decried President Donald Trump’s tough trade rhetoric and tariffs on Chinese and European imports. European Union finance chief Pierre Moscovici urged the U.S. to act like allies, not foes. French finance minister Bruno Le Marie accused Trump of creating a “survival of the fittest” trade mentality and called on Washington to “de-escalate.” Trump has imposed tariffs on imports of European steel (25 percent) and aluminum (10 percent) while also slapping billions of dollars in tariffs on Chinese goods and threatening more. He has also accused China and the EU of keeping their interests rates and currencies low, damaging the U.S. dollar on the world market.   …

Prime Minister Theresa May’s plans to leave the European Union are overwhelmingly opposed by the British public and more than a third of voters would support a new right-wing political party committed to quitting the bloc, according to a new poll. May’s political vulnerability was exposed by the survey which found voters would prefer Boris Johnson, who quit as her foreign minister two weeks ago, to negotiate with the EU and lead the Conservative Party into the next election. Only 16 percent of voters say May is handling the Brexit negotiations well, compared with 34 percent who say that Johnson would do a better job, according to the poll conducted by YouGov for The Sunday Times newspaper. With a little more than eight months to go before Britain is due to leave the EU on March 29, 2019, May’s government, parliament, the public and businesses remain deeply divided over what form Brexit should take. May’s plans to keep a close trading relationship with the EU on goods thrust her government into crisis this month and there is speculation she could face a leadership challenge after two of her most senior ministers, including Johnson, resigned in protest. Only one in 10 voters would pick the government’s proposed Brexit plans if there were a second referendum, according to the poll. Almost half think it would be bad for Britain. The new Brexit minister Dominic Raab said on Sunday the prime minister was still trying to persuade members of the cabinet that her …