…

WASHINGTON — The U.S. trade deficit widened to the highest level in more than two years in July as businesses likely front-loaded imports in anticipation of higher tariffs on goods, suggesting trade could remain a drag on economic growth in the third quarter.

While the surge in imports reported by the Commerce Department on Wednesday would subtract from gross domestic product, it was an indication of strong domestic demand and inconsistent with financial market fears of a recession.

“The July trade data suggest that net trade will weigh on third-quarter GDP growth, but that is hardly cause for concern when it reflects the continued strength of imports, painting a better picture of domestic demand than renewed recession fears would suggest,” said Thomas Ryan, North America economist at Capital Economics.

The trade gap increased 7.9% to $78.8 billion, the widest since May 2022, the Commerce Department’s Bureau of Economic Analysis said.

The government revised the trade data from January through June 2024 to incorporate more comprehensive and updated quarterly and monthly figures.

Imports increased 2.1% to $345.4 billion. Goods imports rose 2.3% to $278.2 billion, the highest since June 2022. They were boosted by an increase in capital goods, which increased $3.3 billion to a record high, mostly reflecting computer accessories.

Imports of industrial supplies and materials, which include petroleum, increased $2.8 billion. There were also rises in imports of nonmonetary gold-finished metal shapes.

President Joe Biden’s administration has announced plans to impose steeper tariffs on imports of Chinese electric vehicles, batteries, solar products and other goods.

The government said last week a final determination will be made public in the “coming days.” There are also fears of even higher tariffs on Chinese imports should former President Donald Trump return to the White House after the November 5 election.

The politically sensitive goods trade deficit with China increased $4.9 billion to $27.2 billion. Exports to China fell $1.0 billion while imports advanced $3.9 billion.

“Imports of goods from China increased, which shows how difficult it will be to direct U.S. manufacturers away from their dependence on lower-cost goods originating from China if that is what Congress and political candidates wish to do,” said Christopher Rupkey, chief economist at FWDBONDS.

Exports gained 0.5% to $266.6 billion. Goods exports climbed 0.4% to $175.1 billion. Exports of motor vehicles, parts and engines decreased $1.7 billion to the lowest since June 2022. Consumer goods exports fell $800 million.

Exports of capital goods surged $1.8 billion to a record $56.1 billion, boosted by semiconductors.

The goods trade deficit increased 6.9% to $97.6 billion after adjusting for inflation.
…

Geneva — Workers have seen their slice of the global income pie shrink significantly over the past two decades, swelling inequality and depriving the combined labor force of trillions, the U.N. said Wednesday. 

The United Nations’ International Labor Organization said that the global labor income share — or the proportion of total income in an economy earned by working — had fallen by 1.6 percentage points since 2004. 

“While the decrease appears modest in terms of percentage points, in 2024 it represents an annual shortfall in labor income of $2.4 trillion compared to what workers would have earned had the labor income share remained stable since 2004,” the ILO said in a report. 

The study highlighted the COVID-19 pandemic as a key driver of the decline, with almost half of the reduction in labor income share taking place during the pandemic years of 2020-2022.  

The global crisis exacerbated existing inequalities, particularly as capital income has continued to concentrate ever more among the wealthiest, it said. 

“Countries must take action to counter the risk of declining labor income share,” Celeste Drake, the ILO deputy director-general, said in a statement. 

“We need policies that promote an equitable distribution of economic benefits, including freedom of association, collective bargaining and effective labor administration, to achieve inclusive growth, and build a path to sustainable development for all.” 

Deepening inequality

The ILO stressed that technological advances, including automation, were a key driver of the declines in labor income share. 

“While these innovations have boosted productivity and output, the evidence suggests that workers are not sharing equitably from the resulting gains,” the U.N. labor agency said. 

It voiced particular concern that the artificial intelligence boom risked deepening inequality further.  

“If historical patterns were to persist… the recent breakthroughs in generative AI could exert further downward pressure on the labor income share,” the report said, stressing “the importance of ensuring that any benefits of AI are widely distributed”. 

The ILO found that workers currently rake in just 52.3 percent of global income, while capital income — earned by owners of assets like land, machines, buildings and patents — accounts for the rest. 

Since capital income tends to be concentrated among wealthier individuals, the labor income share is widely used as a measure of inequality. 

It also helps measure progress towards the U.N. sustainable development goal aimed at significantly reducing inequality between and within countries between 2015 and 2030. 

“The report indicates slow progress as the 2030 deadline approaches,” ILO said. 

The report also emphasized the stubbornly high incidence of young people who are not in employment, education or training (NEET). 

Since 2015, the global percentage has slipped slightly, from 21.3% to 20.4% this year. 

But there are major regional differences, with a third of youth in Arab states and nearly a quarter in Africa falling into the NEET category.  

The report also highlighted a large gender gap, with the global NEET incidence among young women standing at 28.2% — more than double the 13.1% seen among young men. 
…

Національний банк України встановив опівдні довідкове значення курсу на рівні 41 гривня 32,73 копійки за долар
…

На початку липня Україна отримала 2,2 мільярда доларів від Міжнародного валютного фонду
…

Abuja, Nigeria — Barely 48 hours after Nigeria’s state-owned oil company made a startling revelation, hundreds of commuters joined a line stretching many kilometers for fuel at an NNPC outlet in the capital.

In a statement Sunday, Nigeria’s state oil firm, NNPC Limited, said that financial constraints are hampering its ability to import gasoline.

The statement acknowledged local media reports in July that the oil regulator owed oil traders more than $6 billion — double its debt compared with April.

Nigeria depends on imports to meet its daily demand for gasoline — more than 66 million liters — and NNPC is the sole importer of fuel.

Abuja resident John Prince said he’d been waiting in line for hours.

“When I came in the morning, they were not selling [gasoline]. They said they were waiting for orders from above. [Now] I’ve been here for the past two hours,” he said.

Prince said that while customers waited, the gasoline station increased prices by nearly 30%.

NNPC said the situation could worsen supply in coming days but also said it is working with the government and other partners to fix the problem.

Fuel shortages have been recurring in Nigeria since last year, despite Nigerian President Bola Tinubu scrapping the fuel subsidy.

Tinubu doubles as petroleum minister, but authorities later reinstated a partial subsidy to curb inflation, the high cost of living and growing public tensions triggered by economic reforms.

But the founder of the Center for Transparency Advocacy, Faith Nwadishi, said corruption and incompetence are to blame.

“It’s just a cocktail of corruption, impunity and no regard for the people of the country,” she said. “I think it’s just another ploy to make Nigerians pay for impunity. It’s quite disheartening. This morning, I had to queue so that I could get fuel to come out. You know — man hours lost, no productivity, and nobody is making any compensation for that. It’s unfortunate.”

Last month, NNPC announced a record $1.9 billion in profits for 2023 but said it was covering for shortfalls in the government’s petrol import bill.

Ogho Okiti, an economic analyst, said, “Every other oil-producing country is smiling now except Nigeria. So, it’s a transparency problem. There’s so much uncertainty. And that heightened uncertainty and volatility will continue to drive the price and, of course, drive the conditions that we see.

“As it is, we’re losing in all ramifications — we’re paying exorbitant prices for fuel, the government is not getting the resources, and the exchange rate is worsening,” Okiti said.

Meanwhile, authorities say the Dangote Oil Refinery in the Lagos area has begun gasoline production and could supply up to 25 million liters this month.

On Tuesday, the Nigerian Midstream and Downstream Petroleum Regulatory Authority entered an agreement with the NNPC to sell crude oil to Dangote refinery in the local currency, the naira.

If that happens, it could significantly address local supply issues and save the country several billions of dollars in foreign exchange.
…

Nairobi — Kenyan officials have long pushed for milk to be pasteurized before it reaches the marketplace, but much of the milk sold is not pasteurized because small-scale vendors and producers can’t afford the expensive machines used in the process. Now, Canadian university graduates have developed a portable, affordable pasteurization machine that could help African farmers cheaply sterilize the dairy product and reduce milk-related disease.

In Kenya, smallholder farmers produce 56% of the milk, with five million dairy cattle generating five billion liters annually. According to Kenya’s Dairy Board, only 28% of that milk is processed by dairy companies, which pasteurize it to kill harmful bacteria.

The remaining 72% is sold directly to consumers by vendors who traditionally heat and reheat the milk over a fire, a method that fails to ensure complete safety.

To address the challenge faced by millions of farmers in Africa and around the world, a group of recent university graduates from Canada has developed a portable pasteurizer machine to help farmers sterilize milk cheaply and in a healthy way.

Miraal Kabir is the head of the startup Safi, which means “pure” in Swahili. She said her technology provides health and economic benefits to users and milk consumers.

“It solves two problems. The main one being the problem of unsafe milk. It allows all of the milk being sold in the market to be safe, which isn’t the case right now. That’s leading to a lot of deaths, a lot of diseases, especially for children under five. And then on a secondary problem that it’s solving, right now in the dairy supply chain, the people who are winning the most are these large processors,” she said.

“They sell milk extremely cheap to these processors who then sell it at a huge premium. And so by allowing small scale farmers to pasteurize the milk themselves and earn the premium of pasteurized milk themselves, we’re actually empowering them financially as well.”

The device is placed on top of a pot. It has a whisk to stir the milk and ensure that it is heated uniformly. It also has a screen and LED lights, which guide the user through pasteurization. A temperature sensor tells the user when the milk is ready.

Moses Sitati is a dairy farmer in western Kenya. His cows produce 60 liters of milk per day, of which 10 liters spoil, meaning it is not suitable for human consumption.

The 40-year-old farmer has been using the pasteurizer for the past 12 months.

“I can sell milk, people can just buy milk and take it at the same time without going and boiling it fast. Now you know when you boil, wait until again by tomorrow so you boil, you are losing the milk, the first thing and also the nutrients. Now the pasteurizer helps to at least store the milk, it helps at least to preserve the milk for a long time,” he said.

In addition to farmers losing their income, raw and unpasteurized milk contains harmful bacteria like salmonella, E. coli, Brucella, tuberculosis, and Q fever.

Sitati is among the 20 farmers and vendors in Kenya and Rwanda who have purchased the pasteurizer.

The father of three happened to get the first product developed by the Safi team, which didn’t satisfy him, but he says he is happy with the final product for its safety and energy consumption.

“The first one could pasteurize milk from two to 10 liters, but this one pasteurized milk from two to 20 liters. The first one didn’t have a lid, so when pasteurizing the milk, it could spill out, so they improved this to put a lid so that there is no milk spilling out when you are pasteurizing. The first one used electricity, and this one uses solar energy. When you charge, you can use it for four hours,” he said.

Last month, the Safi company said it partnered with the Rwandan government, which helped them open for commercialization after taking part in pilot programs.

Kabir said the device tracks pasteurization data, letting farmers prove milk safety and helping regulators monitor it.

“We’ve also incorporated the data software side of things. Our device is actually able to capture all the key pasteurization data and provide it to the farmer themselves or the vendors so that they can prove that they have pasteurized their milk to their customers, but then we’re also able to aggregate all of this data and provide it to governments. Governments and regulators, they’re able to see where milk has been pasteurized, when it was pasteurized, where safe milk is being sold,” said Kabir.

The innovators say they hope to find a good manufacturer to start producing the device next year and make billions of liters of milk disease-free.
…