your ads here!
Category: Економіка

Boeing Bids Farewell to an Icon, Delivers Last 747 Jumbo Jet

No Comments

Boeing bid farewell to an icon on Tuesday, delivering its final 747 jumbo jet as thousands of workers who helped build the planes over the past 55 years looked on. 

Since its first flight in 1969, the giant yet graceful 747 has served as a cargo plane, a commercial aircraft capable of carrying nearly 500 passengers, a transport for NASA’s space shuttles, and the Air Force One presidential aircraft. It revolutionized travel, connecting international cities that had never before had direct routes and helping democratize passenger flight. 

But over about the past 15 years, Boeing and its European rival Airbus have introduced more profitable and fuel efficient wide-body planes, with only two engines to maintain instead of the 747’s four. The final plane is the 1,574th built by Boeing in the Puget Sound region of Washington state. 

Thousands of workers joined Boeing and other industry executives from around the world — as well as actor and pilot John Travolta, who has flown 747s — Tuesday for a ceremony in the company’s massive factory north of Seattle, marking the delivery of the last one to cargo carrier Atlas Air. 

“If you love this business, you’ve been dreading this moment,” said longtime aviation analyst Richard Aboulafia. “Nobody wants a four-engine airliner anymore, but that doesn’t erase the tremendous contribution the aircraft made to the development of the industry or its remarkable legacy.” 

Boeing set out to build the 747 after losing a contract for a huge military transport, the C-5A. The idea was to take advantage of the new engines developed for the transport — high-bypass turbofan engines, which burned less fuel by passing air around the engine core, enabling a farther flight range — and to use them for a newly imagined civilian aircraft. 

It took more than 50,000 Boeing workers less than 16 months to churn out the first 747 — a Herculean effort that earned them the nickname “The Incredibles.” The jumbo jet’s production required the construction of a massive factory in Everett, north of Seattle — the world’s largest building by volume. The factory wasn’t even completed when the first planes were finished. 

Among those in attendance was Desi Evans, 92, who joined Boeing at its factory in Renton, south of Seattle, in 1957 and went on to spend 38 years at the company before retiring. One day in 1967, his boss told him he’d be joining the 747 program in Everett — the next morning. 

“They told me, ‘Wear rubber boots, a hard hat and dress warm, because it’s a sea of mud,'” Evans recalled. “And it was — they were getting ready for the erection of the factory.” 

He was assigned as a supervisor to help figure out how the interior of the passenger cabin would be installed and later oversaw crews that worked on sealing and painting the planes. 

“When that very first 747 rolled out, it was an incredible time,” he said as he stood before the last plane, parked outside the factory. “You felt elated — like you’re making history. You’re part of something big, and it’s still big, even if this is the last one.” 

The plane’s fuselage was 225 feet (68.5 meters) long and the tail stood as tall as a six-story building. The plane’s design included a second deck extending from the cockpit back over the first third of the plane, giving it a distinctive hump and inspiring a nickname, the Whale. More romantically, the 747 became known as the Queen of the Skies. 

Some airlines turned the second deck into a first-class cocktail lounge, while even the lower deck sometimes featured lounges or even a piano bar. One decommissioned 747, originally built for Singapore Airlines in 1976, has been converted into a 33-room hotel near the airport in Stockholm. 

“It was the first big carrier, the first widebody, so it set a new standard for airlines to figure out what to do with it, and how to fill it,” said Guillaume de Syon, a history professor at Pennsylvania’s Albright College who specializes in aviation and mobility. “It became the essence of mass air travel: You couldn’t fill it with people paying full price, so you need to lower prices to get people onboard. It contributed to what happened in the late 1970s with the deregulation of air travel.” 

The first 747 entered service in 1970 on Pan Am’s New York-London route, and its timing was terrible, Aboulafia said. It debuted shortly before the oil crisis of 1973, amid a recession that saw Boeing’s employment fall from 100,800 employees in 1967 to a low of 38,690 in April 1971. The “Boeing bust” was infamously marked by a billboard near the Seattle-Tacoma International Airport that read, “Will the last person leaving SEATTLE — Turn out the lights.” 

An updated model — the 747-400 series — arrived in the late 1980s and had much better timing, coinciding with the Asian economic boom of the early 1990s, Aboulafia said. He took a Cathay Pacific 747 from Los Angeles to Hong Kong as a twentysomething backpacker in 1991. 

“Even people like me could go see Asia,” Aboulafia said. “Before, you had to stop for fuel in Alaska or Hawaii and it cost a lot more. This was a straight shot — and reasonably priced.” 

Delta was the last U.S. airline to use the 747 for passenger flights, which ended in 2017, although some other international carriers continue to fly it, including the German airline Lufthansa. 

Lufthansa CEO Carsten Spohr recalled traveling in a 747 as a young exchange student and said that when he realized he’d be traveling to the West Coast of the U.S. for Tuesday’s event, there was only one way to go: riding first-class in the nose of a Lufthansa 747 from Frankfurt to San Francisco. He promised the crowd Lufthansa would keep flying the 747 for many years to come. 

“We just love the airplane,” he said. 

Atlas Air ordered four 747-8 freighters early last year, with the final one — emblazoned with an image of Joe Sutter, the engineer who oversaw the 747’s original design team — delivered Tuesday. Atlas CEO John Dietrich called the 747 the greatest air freighter, thanks in part to its unique capacity to load through the nose cone. 

your ads here!

Delay in Reforms Puts Pakistan’s Economy in Crisis

No Comments

Pakistan is facing a severe economic crisis. Prices of staples like food and fuel are skyrocketing. The country must repay billions in external debt, but its foreign reserves are so low it can barely afford to buy a few weeks’ worth of imports. As the government tries to revive stalled talks with the International Monetary Fund to unlock much-needed assistance, Sarah Zaman looks at how delaying reforms has brought Pakistan to the brink of economic disaster.

your ads here!

US Treasury to Increase Borrowing Amid Debt Ceiling Standoff

No Comments

The Treasury Department said Monday it plans to increase its borrowing during the first three months of 2023, even as the federal government is bumping up against a $31.4 trillion limit on its legal borrowing authority. 

The U.S. plans to borrow $932 billion during the January-to-March quarter. That’s $353 billion more than projected last October, due to a lower beginning-of-quarter cash balance and projections of lower-than-expected income tax receipts and higher spending. 

The increased borrowing will take place as Democrats and the White House push for Congress to increase the federal debt limit. President Joe Biden wants the cap raised without any preconditions. The new House Republican majority is seeking to secure spending cuts in exchange for a debt limit increase. 

Treasury officials say the debate over the debt ceiling poses a risk to the U.S. financial position. 

“Even just the threat that the U.S. government might fail to meet its obligations may cause severe harm to the economy by eroding household and business confidence, injecting volatility into financial markets, and raising the cost of capital — among other negative impacts,” Ben Harris, Treasury’s assistant secretary for economic policy, said in a statement. 

Treasury Secretary Janet Yellen, in a letter to congressional leaders earlier this month, said the department had begun resorting to “extraordinary measures” to avoid a federal government default. She said it’s “critical that Congress act in a timely manner” to raise or suspend the debt limit. 

In a letter to House and Senate leaders, Yellen said her actions will buy time until Congress can pass legislation that will either raise the nation’s borrowing authority or suspend the limit for a period of time. She said it is unlikely that cash and extraordinary measures will be exhausted before early June. 

New House Speaker Kevin McCarthy will meet with Biden at the White House this week to discuss the debt limit. 

McCarthy told CBS’ “Face the Nation” on Sunday: “I want to sit down together, work out an agreement that we can move forward to put us on a path to balance — and at the same time not put any of our debt in jeopardy at the same time.” 

your ads here!

Economic Dividend or Disadvantage as India Becomes World’s Most Populous Country This Year

No Comments

India’s population is set to surpass China’s sometime this year according to the United Nations. Experts say while this represents an opportunity to reap a demographic dividend, much will depend on how India leverages its numbers, especially its massive population of young people. Anjana Pasricha has a report from New Delhi.

your ads here!

House Speaker McCarthy Optimistic on US Debt Deal

No Comments

U.S. House Speaker Kevin McCarthy promised Sunday the United States would not default on its national debts as the country approaches its $31.4 trillion spending limit in June but said the government cannot continue to annually spend more than it collects in taxes.

McCarthy, leader of the Republican-controlled House of Representatives, told CBS’s “Face the Nation” show that he will meet with Democratic President Joe Biden on Wednesday, the first discussions in what could be protracted debt ceiling talks over several months.

The U.S. must raise its debt ceiling before it runs out of money to pay bills it has already incurred. Biden and Democrats want a “clean” approval to raise the debt ceiling not tied to future spending, while Republicans have called for limits on new spending to curb yearly deficits, chronic overspending that often totals more than $1 trillion annually.

“We’re not going to default,” McCarthy said.

The U.S. has never defaulted on its debts, such as on Treasury notes sold to China, Japan and individual Americans, but its credit rating was downgraded in 2011 when Democratic President Barack Obama and congressional Republicans sparred at length over the country’s spending before eventually reaching a 10-year agreement.

Now, McCarthy said, the country’s debt totals 120% of its national economic output, with the debt significantly added to in recent years for two main reasons, the national tax cuts Republicans approved under former President Donald Trump and unfunded coronavirus aid relief approved under both Trump and Biden.

“We haven’t been in this place to debt since World War II,” McCarthy said. “So, we can’t continue down this path. And I don’t think there’s anyone in America who doesn’t agree that there’s some wasteful Washington spending that we can eliminate.”

“So, I want to sit down together, work out an agreement that we can move forward, to put us on a path to balance — at the same time, not put any — any of our debt in jeopardy at the same time,” he said. “We shouldn’t just print more money; we should balance our budget. So, I want to look at every single department. Where can we become more efficient, more effective, and more accountable?”

McCarthy, like Biden, ruled out cuts to two of the most popular government programs, pensions and health care for older Americans, respectively known as Social Security and Medicare.

But he added, “I want to look at every single dollar we’re spending, no matter where it’s being spent. I want to eliminate waste wherever it is.”

He compared government spending to an American family’s budget, saying, “Every family does this. What is – what has happened with the debt limit is you reached your credit card limit. Should we just continue to raise the limit? Or should we look at what we’re spending?”

your ads here!

‘Whale Meat’ Vending Machines Push Sales in Japan

No Comments

A Japanese whaling operator, after struggling for years to promote its products amid protests from conservationists, has found a new way to cultivate clientele and bolster sales: whale meat vending machines.

The Kujira (Whale) Store, an unmanned outlet that recently opened in the port town of Yokohama near Tokyo, houses three machines for whale sashimi, whale bacon, whale skin and whale steak, as well as canned whale meat. Prices range from 1,000 yen ($7.70) to 3,000 yen ($23).

The outlet features white vending machines decorated with cartoon whales and is the third location to launch in the Japanese capital region. It opened Tuesday after two others were introduced in Tokyo earlier this year as part of Kyodo Senpaku Co.’s new sales drive.

Whale meat has long been a source of controversy but sales in the new vending machines have quietly gotten off to a good start, the operator says. Anti-whaling protests have subsided since Japan in 2019 terminated its much-criticized research hunts in the Antarctic and resumed commercial whaling off the Japanese coasts.

Conservationists say they are worried the move could be a step toward expanded whaling.

“The issue is not the vending machines themselves but what they may lead to,” said Nanami Kurasawa, head of the Iruka & Kujira (Dolphin & Whale) Action Network.

Kurasawa noted the whaling operator is already asking for additional catches and to expand whaling outside of the designated waters.

Kyodo Senpaku hopes to set up vending machines at 100 locations nationwide in five years, company spokesperson Konomu Kubo told The Associated Press. A fourth is to open in Osaka next month.

The idea is to open vending machines near supermarkets, where whale meat is usually unavailable, to cultivate demand, a task crucial for the industry’s survival.

Major supermarket chains have largely stayed away from whale meat to avoid protests by anti-whaling groups and remain cautious even though harassment from activists has subsided, Kubo said.

“As a result, many consumers who want to eat it cannot find or buy whale meat. We launched vending machines at unmanned stores for those people,” he said.

Company officials say sales at the two Tokyo outlets have been significantly higher than expected, keeping staff busy replenishing products.

At the store in the Motomachi district of Yokohama, a posh shopping area near Chinatown, 61-year-old customer Mami Kashiwabara went straight for whale bacon, her father’s favorite. To her disappointment it was sold out, and she settled for frozen onomi, tail meat that is regarded as a rare delicacy.

Kashiwabara says she is aware of the whaling controversy, but that whale meat brings back her childhood memories of eating it at family dinners and school lunches.

“I don’t think it’s good to kill whales meaninglessly. But whale meat is part of Japanese food culture, and we can respect the lives of whales by appreciating their meat,” Kashiwabara said. “I would be happy if I can eat it.”

Kashiwabara said she planned to share her purchase of a 3,000 yen ($23) handy-size chunk, neatly wrapped in a freezer bag, with her husband over sake.

The meat mostly comes from whales caught off Japan’s northeastern coast.

Japan resumed commercial whaling in July 2019 after withdrawing from the International Whaling Commission, ending 30 years of what it called research whaling, which had been criticized by conservationists as a cover for commercial hunts banned by the IWC in 1988.

Under its commercial whaling in the Japanese exclusive economic zone, Japan last year caught 270 whales, less than 80% of the quota and fewer than the number it once hunted in the Antarctic and the northwestern Pacific in its research program.

The decline occurred because fewer minke whales were found along the coast. Kurasawa says the reason for the smaller catch should be examined to see if it is linked to overhunting or climate change.

While conservation groups condemned the resumption of commercial whaling, some see it as a way to let the government’s embattled and expensive whaling program adapt to changing times and tastes.

In a show of determination to keep the whaling industry alive in the coming decades, Kyodo Senpaku will construct a 6 billion yen ($46 million) new mother ship for launch next year to replace the aging Nisshin Maru.

But uncertainty remains.

Whaling is losing support in other whaling nations such as Iceland, where only one whaler remains.

Whales may also be moving away from the Japanese coasts due to a scarcity of saury, a staple of their diet, and other fish possibly due to the impact of climate change, Kubo said.

Whaling in Japan involves only a few hundred people and one operator and accounted for less than 0.1% of total meat consumption in recent years, according to Fisheries Agency data.

Still, conservative governing lawmakers staunchly support commercial whaling and consumption of the meat as part of Japan’s cultural tradition.

Conservationists say whale meat is no longer part of the daily diet in Japan, especially for younger generations.

Whale meat was an affordable source of protein during Japan’s undernourished years after World War II, with annual consumption peaking at 233,000 tons in 1962.

Whale was quickly replaced by other meats. The whale meat supply fell to 6,000 tons in 1986, the year before the moratorium on commercial whaling imposed by the IWC banned the hunting of several whale species.

Under the research whaling, criticized as a cover for commercial hunts because the meat was sold on the market, Japan caught as many as 1,200 whales annually. It has since drastically cut back its catch after international protests escalated and whale meat supply and consumption slumped at home.

Annual meat supply had fluctuated in a range of 3,000-5,000 tons, including imports from Norway and Iceland. The amount further fell in 2019 to 2,000 tons, or 20 grams (less than 1 ounce) of whale meat per person a year, the Fisheries Agency statistics show.

Whaling officials attributed the shrinking supply in the past three years to the absence of imports due to the pandemic, and plan to nearly double this year’s supply with imports of more than 2,500 tons from Iceland.

Japan managed to get Iceland’s only remaining whaler to hunt fin whales exclusively for shipment to Japan, whaling officials said. Iceland caught only one minke whale in the 2021 season, according to the IWC.

Criticizing Iceland’s export to Japan, the International Fund for Animal Welfare said it “opposes all commercial whaling as it is inherently cruel.”

With uncertain outlook for imports, Kyodo Senpaku wants the government to raise Japan’s annual catch quota to levels that can supply about 5,000 tons, which Kubo describes as the threshold to maintain the industry.

“From a long-term perspective, I think it would be difficult to sustain the industry at the current supply levels,” Kubo said. “We must expand both supply and demand, which have both shrunk.”

your ads here!

Is Tipping Getting Out of Control? Many US Consumers Say Yes

No Comments

Across the U.S., there’s a silent frustration brewing about an age-old practice that many say is getting out of hand: tipping.

Some fed-up consumers are posting rants on social media complaining about tip requests at drive-thrus, while others say they’re tired of being asked to leave a gratuity for a muffin or a simple cup of coffee at their neighborhood bakery. What’s next, they wonder — are we going to be tipping our doctors and dentists, too?

As more businesses adopt digital payment methods, customers are automatically being prompted to leave a gratuity — many times as high as 30% — at places they normally wouldn’t. And some say it has become more frustrating as the price of items has skyrocketed due to inflation, which eased to 6.5% in December but still remains painfully high.

“Suddenly, these screens are at every establishment we encounter. They’re popping up online as well for online orders. And I fear that there is no end,” said etiquette expert Thomas Farley, who considers the whole thing somewhat of “an invasion.”

Unlike tip jars that shoppers can easily ignore if they don’t have spare change, experts say the digital requests can produce social pressure and are more difficult to bypass. And your generosity, or lack thereof, can be laid bare for anyone close enough to glance at the screen — including the workers themselves.

Dylan Schenker is one of them. The 38-year-old earns about $400 a month in tips, which provides a helpful supplement to his $15 hourly wage as a barista at Philadelphia café located inside a restaurant. Most of those tips come from consumers who order coffee drinks or interact with the café for other things, such as carryout orders. The gratuity helps cover his monthly rent and eases some of his burdens while he attends graduate school and juggles his job.

Schenker says it’s hard to sympathize with consumers who are able to afford pricey coffee drinks but complain about tipping. And he often feels demoralized when people don’t leave behind anything extra — especially if they’re regulars.

“Tipping is about making sure the people who are performing that service for you are getting paid what they’re owed,” said Schenker, who’s been working in the service industry for roughly 18 years.

Traditionally, consumers have taken pride in being good tippers at places like restaurants, which typically pay their workers lower than the minimum wage in expectation they’ll make up the difference in tips. But academics who study the topic say many consumers are now feeling irritated by automatic tip requests at coffee shops and other counter service eateries where tipping has not typically been expected, workers make at least the minimum wage and service is usually limited.

“People do not like unsolicited advice,” said Ismail Karabas, a marketing professor at Murray State University who studies tipping. “They don’t like to be asked for things, especially at the wrong time.”

Some of the requests can also come from odd places. Clarissa Moore, a 35-year-old who works as a supervisor at a utility company in Pennsylvania, said even her mortgage company has been asking for tips lately. Typically, she’s happy to leave a gratuity at restaurants, and sometimes at coffee shops and other fast-food places when the service is good. But, Moore said she believes consumers shouldn’t be asked to tip nearly everywhere they go — and it shouldn’t be something that’s expected of them.

“It makes you feel bad. You feel like you have to do it because they’re asking you to do it,” she said. “But then you have to think about the position that puts people in. They’re paying for something that they really don’t want to pay for, or they’re tipping when they really don’t want to tip — or can’t afford to tip — because they don’t want to feel bad.”

In the book “Emily Post’s Etiquette,” authors Lizzie Post and Daniel Post Senning advise consumers to tip on ride-shares, like Uber and Lyft, as well as food and beverages, including alcohol. But they also write that it’s up to each person to choose how much to tip at a café or a take-out food service, and that consumers shouldn’t feel embarrassed about choosing the lowest suggested tip amount, and don’t have to explain themselves if they don’t tip.

Digital payment methods have been around for a number of years, though experts say the pandemic has accelerated the trend towards more tipping. Michael Lynn, a consumer behavior professor at Cornell University, said consumers were more generous with tips during the early days of the pandemic in an effort to show support for restaurants and other businesses that were hard hit by COVID-19. Many people genuinely wanted to help out and felt sympathetic to workers who held jobs that put them more at risk of catching the virus, Lynn said.

Tips at full-service restaurants grew by 25.3% in the third quarter of 2022, while gratuities at quick or counter service restaurants went up 16.7% compared to the same time in 2021, according to Square, one of the biggest companies operating digital payment methods. Data provided by the company shows continuous growth for the same period since 2019.

As tip requests have become more common, some businesses are advertising it in their job postings to lure in more workers even though the extra money isn’t always guaranteed.

In December, Starbucks rolled out a new tipping option on credit and debit card transactions at its stores, something a group organizing the company’s hourly workers had called for. Since then, a Starbucks spokesperson said nearly half of credit and debit card transactions have included a gratuity, which – along with tips received through cash and the Starbucks app – are distributed based on the number of hours a barista worked on the days the tips were received.

Karabas, the Murray State professor, says some customers, like those who’ve worked in the service industry in the past, want to tip workers at quick service businesses and wouldn’t be irritated by the automatic requests. But for others, research shows they might be less likely to come back to a particular business if they are feeling irritated by the requests, he said.

The final tab might also impact how customers react. Karabas said in the research he did with other academics, they manipulated the payment amounts and found that when the check was high, consumers no longer felt as irritated by the tip requests. That suggests the best time for a coffee shop to ask for that 20% tip, for example, might be on four or five orders of coffee, not a small cup that costs $4.

Some consumers might continue to shrug off the tip requests regardless of the amount.

“If you work for a company, it’s that company’s job to pay you for doing work for them,” said Mike Janavey, a footwear and clothing designer who lives in New York City. “They’re not supposed to be juicing consumers that are already spending money there to pay their employees.”

Schenker, the Philadelphia barista, agrees — to a certain extent.

“The onus should absolutely be on the owners, but that doesn’t change overnight,” he said. “And this is the best thing we have right now.”

your ads here!

Україні потрібно 17 млрд доларів для швидкого відновлення енергетики – Шмигаль

No Comments

«Вчора Україна пережила вже 13-ту велику повітряну атаку проти нашої енергосистеми… Цього разу головною ціллю ворога була високовольтна інфраструктура»

your ads here!

With New Deep Sea Port, Nigeria’s Focus Turns to Better Road, Rail Connections 

No Comments

Nigerian authorities have hailed the launch of a deepwater seaport in Lagos they say will create 300,000 jobs and reduce shipping bottlenecks. While the new port is expected to reduce losses due to congestion, shipping industry experts say Nigeria’s poor roads and rail connections to ports also must be improved.

The launch by President Mohammadu Buhari during his two-day visit this week to Lagos signaled his government’s effort to grow Nigeria’s economy through infrastructural development.

The 1.5-billion-dollar, Chinese-built Lekki Deep Sea Port sits on 90 hectares of land in the Lagos Free Trade Zone — the biggest port by size in West Africa.

Authorities say ships docking at the port could be up to four times the size of vessels at the state’s Tin Can and Apapa ports. They expect it will ease delays and congestion at ports and increase earnings by up to $360 billion in coming years.

Efioita Ephraim is a manager at Ports and Terminal Nigeria, Ltd.

“The current ports we have in the country are located along rivers, tributaries and that’s why there are limitations. It’s a welcome development to have an infrastructure like this in our country. With this, larger vessels will be able to berth at our ports and we shall be in competition with neighboring countries such as Cotonou [Benin],” said Ephraim.

Most of Nigeria’s seaports were built many decades ago and are either closed or operating below capacity.

Nigeria loses an estimated $1 billion a year to delays and bottlenecks at ports. To address the problem, the Nigerian Ports Authority launched an automated process for clearing cargo at ports.

Abiodun Gbadamosi is the former general manager of Nigeria’s western ports. He said the new deep sea port at Lagos will add to Nigeria’s economic progress and create jobs.

The country’s bureau of statistics says Nigeria’s unemployment rate is 33 percent.

“What Nigeria needs now are jobs, jobs and more jobs, and that’s going to go a very long way. It’s going to improve the commerce around that area. It’s highly commendable and it’s going to actually propel the state. Then Nigeria can now push forward the idea of being hub for the region,” he said.

Ephraim said authorities must improve road and rail accessibility to the area.

“If the items are to be conveyed out of the port and into the port by road, then I would expect the multimodal mode of transportation be encouraged to and from the Lekki deep sea port, rail water and road transportation.”

China is one of Nigeria’s biggest lenders and has been funding rail, road and power projects.

The first commercial vessel is expected to arrive in the port this Sunday.

your ads here!

МВФ готує для України новий пакет допомоги на 16 мільярдів доларів – Bloomberg

No Comments

Уже в перший рік дії нової програми Україна може отримати від 5 до 7 мільярдів доларів, а перший транш «у найкращому разі» може надійти в квітні 2023 року

your ads here!

US Economy Showed Solid Growth at End of 2022

No Comments

The U.S. economy cooled only slightly at the end of last year, advancing at an annualized 2.9% rate, the Department of Commerce reported Thursday, even as forecasters are suggesting a recession is possible later in 2023.

The growth in the October-to-December quarter dropped from a 3.2% advance in the third quarter, following a half year when the world’s biggest economy shrank.

For all of 2022, the economy grew by a solid, if unspectacular 2.1%, down from a robust 5.7% growth rate in 2021 when the recovery from the coronavirus pandemic was in full force.

Last year saw contrasting themes, including the fastest growth in consumer prices in four decades, pinching the wallets of Americans at all income levels.

Yet the lowest unemployment rate in 50 years was recorded, with hundreds of thousands of new jobs being added to payrolls every month. Separately, borrowing costs for businesses and consumer loans and home mortgages rose sharply as the country’s central bank, the Federal Reserve, increased its benchmark interest rate seven times, an effort aimed at slowing economic growth and curbing inflation.

By the end of the year and into January, there were signs the economy was slowing, with some forecasters predicting a recession — meaning two straight quarters of economic decline in the coming months.

With higher interest rates, home buying and retail sales have dropped, while manufacturing output fell in November and December. The hiring of temporary workers is weakening, and major companies, especially in technology and media, are laying off thousands of workers. 

While the inflation rate in consumer prices has dropped, it remains high by historical standards — now at a 6.5% annualized rate, well above the 2% rate sought by Federal Reserve policymakers. It is likely to stay high through much of 2023.

The Fed is also planning more interest rate increases, albeit not likely as big as the ones it imposed in 2022. It is another factor that could curtail U.S. economic growth.

The White House and the new Republican majority in the House of Representatives are facing contentious negotiations over increasing the limit on the national debt, now at $31.4 trillion. The U.S. could reach the spending limit by early June.

If an agreement is not reached, the ensuing turmoil would roil world financial markets and the U.S. government’s credit rating could be cut, as occurred in 2011, the last time Congress and the White House quarreled significantly over increasing the debt limit. 

your ads here!

IMF Chief Praises Zambia’s Reforms, Pushes Creditors on Debt

No Comments

The head of the International Monetary Fund is praising Zambia’s efforts to reform its economy and urging its creditors to restructure the country’s debts. Zambia was the first African country to default on its sovereign debt in the COVID era. Economists say prompt debt restructuring is needed to restart Zambia’s stagnant economy.

Speaking at the University of Zambia Tuesday, IMF managing director Kristalina Georgieva applauded Lusaka’s efforts to reform its economy, saying it had done its part and urging its creditors to do theirs.

She said the IMF had reached an understanding in principle with China to restructure almost $6 billion Zambia owes Beijing, one of its main creditors.

The IMF chief acknowledged global disruptions that shook Zambia’s economy.

“Over the last years, we have experienced two unthinkable events:  First COVID, that brought the world economy to a standstill for a prolonged period of time.  Second, the invasion by Russia of Ukraine,” said Georgieva.

Russia’s invasion of Ukraine in February last year disrupted food, energy, and other markets as western governments hit Moscow with sanctions and Russia’s navy stopped Ukraine’s grain exports. 

Zambia defaulted on its debt in November 2020, the first African country to do so after the COVID pandemic.

But Lusaka’s debt problem predates the pandemic.

The government under former President Edgar Lungu from 2015 more than doubled Zambia’s debt as a percentage of GDP, according to World Bank-collected data.

An IMF study released this month says corruption flourished under Lungu’s government, which his former ruling party rejects.

Current President Hakainde Hichilema, who was elected in 2021, pledged to tackle corruption and secured $1.3 billion in IMF support for Zambia’s debt with reforms that cut wasteful spending.   

Civil Society Debt Alliance economist Boyd Muleya said creditors’ delay in negotiating Zambia’s debt is slowing its economic recovery.

“So, the challenge that Zambia faces today mostly is the protracted nature of the debt restructuring process that we have seen and the challenge that further augments this conversation is the fact that there are no timelines that are set and so it creates a lot of uncertainties in terms of economic planning going forward,” said Muleya.

IMF director Georgieva met late Monday with President Hichilema and vowed to help resolve the impasse with creditors.

The Economics Association of Zambia’s Trevor Simumba said reaching a final deal on Zambia’s debt would also help the IMF reverse negative views in Africa on its strict policies.

“As you are aware the economy is stagnant, it’s not growing at a pace that’s required to grow in order to deal with the structural problems.  Simply by the textbook theories of the IMF in terms of the usual – we need to rein in inflation, we need to make sure that the exchange rate is stable, doesn’t depreciate, these things in reality don’t work,” he said.

Zambia says its foreign debt hit $17 billion last June as prices for copper, one of its key exports, crashed.

Zambia is Africa’s second largest producer of the valuable metal after the Democratic Republic of Congo.

your ads here!

Spotify Announces Plan to Lay Off 6% of Workforce

No Comments

Spotify CEO Daniel Ek announced Monday that the company plans to lay off about 6% of its workforce, or roughly 600 employees. The cuts are a result of economic challenges, according to Ek.

The Swedish media streaming giant is one of the largest providers of its kind. Founded in 2006 by Ek and Martin Lorentzon, the company has grown immensely over the years, with over 456 million monthly active listeners.

Ek posted an update on the Spotify blog Monday morning stating the changes that would be taking place within the company.

“In hindsight, I was too ambitious in investing ahead of our revenue growth. And for this reason, today, we are reducing our employee base by about 6% across the company,” Ek said in the memo. “I take full accountability for the moves that got us here today.”

Ek stated that Spotify is committed to ensuring that all impacted employees are treated fairly on their departure. Severance pay will be given “with the average employee receiving approximately five months of severance,” as well as continued health care coverage during that time period. Additionally, all unused paid time off will be paid out and immigration support will be provided to “employees whose immigration status is connected with their employment.” Lastly, “all employees will be eligible for outplacement services for two months.”

These cuts come after other Big Tech companies have announced their own layoffs last week. Alphabet, Google’s parent company, plans to terminate 12,000 employees, while Microsoft revealed they’re cutting 10,000 workers.

Some information for this report came from The Associated Press and Agence France-Presse.   

your ads here!

Fashion Sneakers Propel Sustainable Rubber in Brazil Amazon

No Comments

Rubber tapper Raimundo Mendes de Barros prepares to leave his home, surrounded by rainforest, for an errand in the Brazilian Amazon city of Xapuri. He slides his long, scarred, 77-year-old feet into a pair of sneakers made by Veja, a French brand.

At first sight, the expensive, white-detailed urban tennis shoes seem at odds with the muddy tropical forest. But the distant worlds have converged to produce soles made from native Amazonian rubber.

Veja works with a local cooperative called Cooperacre, which has reenergized the production of a sustainable forest product and improved the lives of hundreds of rubber tapper families. It’s a project that, though modest in scale, provides a real-life example of living sustainably from the forest.

“Veja and Cooperacre are doing an essential job for us who live in the forest. They are making young people come back. They have rekindled the hope of working with rubber,” Rogério Barros, Raimundo’s 24-year-old son, told The Associated Press as he demonstrated how to tap a rubber tree in the family’s grove in the Chico Mendes Extractive Reserve. Extractive reserves in Brazil are government-owned lands set aside for people to make a living while they keep the forest standing.

Rubber was once central to the economy of the Amazon. The first boom came at the turn of the 20th century. Thousands of people migrated inland from Brazil’s impoverished Northeast to work in the forest, often in slave-like conditions.

That boom ended abruptly in the 1910s when rubber plantations started to produce on a large scale in Asia. But during World War II, Japan cut the supply, prompting the United States to finance a restart of rubber production in the Amazon.

After the war, Amazon latex commerce again fell into decline, even as thousands of families continued to work in poor conditions for rubber bosses. In the 1970s, these relatively wealthy individuals began selling land to cattle ranchers from the south, even though, in most cases, they didn’t actually own it, but rather just held concessions because they were well-connected with government officers.

These land sales caused the large scale expulsion of rubber tappers from the forest. That loss of livelihood and deforestation to make way for cattle raising is what prompted the famous environmentalist Chico Mendes — together with a cousin of Barros — to found and lead a movement of rubber tappers. Mendes would be murdered for his work in 1988.

After Mendes’ assassination, the federal government began to create extractive reserves so that the forest could not be sold to make way for cattle. The Chico Mendes reserve is one of these. But the story did not end with the creation of the reserves. Government attempts to promote the latex, including a state-owned condom factory in Xapuri, failed to create a reliable income.

What sets the Veja operation apart is that rubber tappers are now getting paid far above the commodity price for their rubber. In 2022, the Barros family received US$ 4.20 per kilo (2.2 pounds) of rubber tapped from their grove. Before, they made one tenth that amount.

This price that shoe company Veja pays the tappers includes bonuses for sustainable harvests plus recognition of the value of preserving the forest, explains Sebastião Pereira, in charge of Veja’s Amazonian rubber supply chain. The rubber workers also receive federal and state benefits per kilo.

Veja also pays bonuses to tappers who employ best practices and local cooperatives that buy directly from them. The criteria range from zero deforestation to the proper management of rubber trees. Top producers also receive a pair of shoes as a prize.

Veja’s rubber is produced by some 1,200 families from 22 local cooperatives spread across five Amazonian states: Acre, home to the Chico Mendes Extractive Reserve, Amazonas, Rondonia, Mato Grosso, and Pará.

All the rubber goes to the Cooperacre plant in Sena Madureira, in Acre state, where raw product is cut, washed, shredded into smaller pieces, heated, weighed, packed and finally shipped to factories that Veja contracts with in industrialized Rio Grande Sul state, thousands of miles to the south, as well as to Ceara state, in Brazil’s Northeast.

From there the sneakers are distributed to many parts of the world. Over the last 20 years, Veja has sold more than 8 million pairs in several countries and maintains stores in Paris, New York and Berlin. The amount of Amazon rubber it purchases has soared: from 5,000 kilos (11,023 pounds) in 2005 to 709,500 kilos (1.56 million pounds) in 2021, according to company figures.

However, it has not been a game changer for the forest in the Chico Mendes Extractive Reserve, where almost 3,000 families live. The illegal advance of cattle, an old problem, has picked up. Deforestation there has tripled in the past four years, amid the policies of former President Jair Bolsonaro, who was defeated in his reelection bid and left office at the end of last year.

Cattle long ago replaced rubber as Acre’s main economic activity. Nearly half of the state’s rural workforce is employed in cattle ranching, where only 4% live from forest products, mainly Brazil nuts.

According to an economic study by Minas Gerais Federal University, 57% of Acre’s economic output comes from cattle. Rubber makes up less than 1%.

Surrounded by cattle pasture and paved highway — the entry point for deforestation — Chico Mendes has the third highest rate of deforestation of any protected reserve in Brazil.

The growing pressure of cattle on the reserve, which has already lost 9% of its original forest cover, even led Veja to set up its own satellite monitoring system.

“Our platform shows a specific region where deforestation is rampant. So we may go there and talk. But we are aware that our role is to offer an alternative and raise awareness,” Pereira told the AP in a phone interview. “We are careful not to cross the line, as the public authority should be the one doing the law enforcement.”

According to Roberta Graf, who leads Acre’s branch of the association of federal environmental officials, the Veja experience is essential as it shows a path for living inside extractive reserves sustainably. But to achieve that, she argues, requires a joint effort that includes government at different levels, nonprofits and grassroots organizations.

“The forest communities still hold rubber tapping dear. They enjoy making a living off the latex,” she told the AP in an interview in her home in Rio Branco, Acre’s capital. “There are many forest products: copaiba, andiroba (vegetable oils), Brazil nuts, wild cacao, and seeds. The ideal should be to work with all of them according to what each reserve can offer.”

your ads here!

India Facilitates IMF Bailout for Crisis Stricken Sri Lanka

No Comments

Sri Lanka has moved closer to securing a crucial $2.9 billion loan from the International Monetary Fund after India extended financing assurances that Colombo needs from its major foreign creditors to get the bailout package. 

The IMF loan is critical for the tiny island country to begin a slow recovery process from its worst economic crisis in decades. 

Indian External Affairs Minister Subrahmanyam Jaishankar announced that the ministry would facilitate the IMF loan Friday in Colombo, where he met President Ranil Wickremesinghe and other senior Sri Lankan ministers.    

“India decided not to wait on others, but to do what we believe is right. We extended financing assurances to the IMF to clear the way for Sri Lanka to move forward,” Jaishankar said in a statement. “Our expectation is that this will not only strengthen Sri Lanka’s position but ensure that all bilateral creditors are dealt with equally.”  

India is the first of Sri Lanka’s major creditors to agree to restructuring the country’s debt. Colombo needs the same assurances from China, its largest lender, to clear the way for the disbursement of the loan, which the IMF had agreed to grant in August but which remains contingent on the support of its lenders.   

Sri Lankan officials expressed optimism that they will also get Beijing’s backing soon.  

“We can say that discussions with China are at the final stage and we expect their assurances in the next few days,” Sri Lanka’s deputy treasury secretary, Priyantha Ratnayake, told reporters. “Once China also gives assurances soon, then Sri Lanka will work to get [IMF] approval as soon as possible.”  

Sri Lanka went virtually bankrupt last year as it grappled with severe foreign exchange shortages to pay either for essential imports or its foreign creditors. Since then, it has grappled with runaway inflation of food and fuel prices. It also suspended repayment of $7 billion in foreign debt due last year.  

The Indian foreign minister also expressed New Delhi’s commitment to increase investment flows to hasten Sri Lanka’s economic recovery.

“India will encourage greater investments in the Sri Lankan economy, especially in core areas like energy, tourism, and infrastructure,” Jaishankar said.   

India has extended assistance of about $4 billion since Sri Lanka’s economy sank. “For us, it was an issue of the neighborhood first and not leaving a partner to fend for themselves,” he said. 

The two countries are expected to sign a memorandum of understanding for a renewable power project for three islands in Sri Lanka. 

Sri Lanka, which will have to implement stringent reforms to get the IMF loan, has raised taxes and tightened government spending. It has also announced deep cuts in its defense expenditure, saying it will slash its army by one third.  

Political stability has returned to the country after it was rocked by widespread citizen protests that led to the resignation of former president Gotabaya Rajapaksa, who was widely blamed for the crisis.  

The severe fuel and food shortages have also eased and tourists are returning to the county, helping the recovery of its tourist-dependent economy. But the dramatic rise in the cost of living continues to pose a challenge to millions in the country. 

your ads here!