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China approved five genetically modified (GM) crops for import on Tuesday, the first in about 18 months in a move that could boost its overseas grains purchases and ease pressure from the United States to open its markets to more farm goods.

The United States is the world’s biggest producer of GM crops, while China is the top importer of GM soybeans and canola.

U.S. farmers and global seed companies have long complained about Beijing’s slow and unpredictable process for approving GM crops for import, stoking trade tensions between the world’s two largest economies.

The approvals, announced on the agriculture ministry’s website, were granted while a U.S. trade delegation is meeting with its counterparts in the Chinese capital this week.

“It’s a goodwill gesture towards the resolution of the trade issue,” said a China representative of a U.S. agricultural industry association.

“It’s been in the system for a long time but they chose today to release this good news,” he added, declining to be identified due to the sensitivity of the matter.

The approved products included DowDuPont Inc.’s DP4114 Qrome corn and DAS-44406-6 soybean, known as Enlist E3, as well as the SYHT0H2 soybean developed by Bayer CropScience and Syngenta but now held by German chemical company BASF.

The other two newly approved products – BASF’s RF3 canola and Bayer-owned Monsanto’s glyphosate-tolerant MON 88302 canola – had been waiting six years for permission.

The approvals came as farmers in North America were deciding which seeds to plant this spring. China before the trade war bought some 60 percent of U.S. soybeans and U.S. farmers do not widely plant varieties it has not approved.

The newly approved canola will allow farmers in Canada to boost production, according to Jim Everson, president of industry group the Canola Council.

“The industry expects growers will produce $400 million more canola every year using the same amount of land – a step-change for canola productivity,” Everson said in a statement.

Five other products known to be seeking approvals were not given the green light, including two GM alfalfa products developed by Monsanto and two DowDuPont soybean traits.

Corteva Agriscience, the agriculture unit of DowDuPont, said, “We are happy to see the regulatory approval of our seed traits progressing in China.”

Bayer said in a statement it welcomed the news but noted “many of these products were stuck in China’s regulatory process for many years and others were not granted approvals, underscoring the need for continued improvement in China’s regulatory processes.”

Chinese officials met their U.S. counterparts in Beijing on Monday for the first face-to-face talks since U.S. President Donald Trump and Chinese President Xi Jinping agreed in December to a 90-day truce in a trade war that has roiled global markets.

China had not approved any GM crops for import since July 2017, when it cleared two products following high-level talks with Washington. It also approved two products in June 2017.

China’s scientific advisory board on GM crops met in June but did not give the go-ahead for imports of any products.

“China’s approval of the new GMO products is paving the way for China to import large volumes of U.S. soybeans in the future. It is a positive signal,” said Li Qiang, chief analyst with Shanghai JC Intelligence Co. Ltd.

The truce in the Sino-U.S. trade war prompted a resumption of U.S. soybean purchases. Buying had slumped after China imposed a 25 percent import duty on U.S. shipments of oilseed on July 6 in response to U.S. tariffs.

Only a Fraction

China does not allow the planting of genetically modified food crops, but imports of GM crops such as soybeans and corn for animal feed are fine.

The country, the world’s biggest soybean consumer, has so far purchased only about 5 million tons of the 2018 U.S. soy harvest, a fraction of its typical purchases.

The United States has demanded that China change its GM crop import application process to make it more transparent, timely and based on scientific methods.

The latest approvals should not be taken as a sign that China is conceding to those demands, said a China-based industry source, who also asked not to be named because of the sensitivity of the matter.

“It’s another piece of evidence that China’s approval process is not entirely scientific but political,” said the source, who also believed the approvals were timed for the trade visit.

The ministry also announced on Tuesday the extension of import approvals for 26 other GM crops by a further three years.
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Venezuela’s opposition-run congress on Tuesday issued a resolution calling deals between state-run oil company PDVSA and U.S. and French companies announced this week illegal, since they had not been sent to lawmakers for approval.

The body said the oilfield deals with France’s Maurel & Prom and little-known U.S. company Erepla violated article 150 of Venezuela’s constitution, which requires that contracts signed between the state and foreign companies be approved by the National Assembly, as Venezuela’s congress is known. 

“They are giving concessions that violate the law,” said lawmaker Jorge Millan, mentioning the two contracts.

Congress, largely stripped of its power since the opposition took it over in 2016, is unlikely to be able block the deals from going forward. But the rejection could create legal complications under a future government.

Maduro is set to be inaugurated for his second consecutive term on Thursday following a May vote considered a sham by the domestic opposition and many foreign governments. A regional bloc of Latin American countries last week called on Maduro, a protege of the late Hugo Chavez, not to take office.

The deals are part of Maduro’s effort to reverse a sharp decline in the OPEC nation’s crude output that has crippled its economy. Erepla said it would invest up to $500 million in three fields, while Maurel & Prom said it would invest up to $400 million for a 40 percent stake in an oilfield joint venture.

PDVSA did not respond to a request for comment. Maurel & Prom did not immediately respond to a request for comment outside of normal business hours in France.

A spokesman for Erepla, registered in Delaware in November and part-owned by a prominent Florida Republican donor and shipping magnate, said Venezuela’s hydrocarbons law “allows PDVSA to contract with companies like Erepla to execute field services without any additional approvals required.”

Referring to the Erepla deal during the congressional session earlier on Tuesday, Millan said that while PDVSA referred to the agreement as an oilfield service contract, “the company will be conducting oil exploration and production activities.”

Maurel & Prom Chief Executive Michel Hochard said the company would act “in accordance with the instructions given” by Maduro and Oil Minister Manuel Quevedo, according to a statement attributed to him in a PDVSA press release.

 
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The World Bank is downgrading its outlook for the global economy this year, citing rising trade tension, weakening manufacturing activity and growing financial stress in emerging-market countries.

In a report titled “Darkening Skies,” the anti-poverty agency said Tuesday that it expects the world economy to grow 2.9 percent in 2019, down from the 3 percent it forecast back in June. It would be the second straight year of slowing growth: The global economy expanded 3 percent last year and 3.1 percent in 2017.

‘Risks are rising’

“Global growth is slowing, and the risks are rising,” Ayhan Kose, the World Bank economist who oversees forecasts, said in an interview. “In 2017, the global economy was pretty much firing on all cylinders. In 2018, the engines started sputtering.”

The bank left its forecast for the U.S. economy unchanged at 2.5 percent this year, down from 2.9 percent in 2018. It predicts 1.6 percent growth for the 19 countries that use the euro currency, down from 1.9 percent last year; and 6.2 percent growth for China, the world’s second-biggest economy, versus 6.5 percent in 2018.

The bank upgraded expectations for the Japanese economy, lifting its growth forecast to 0.9 percent, up from 0.8 percent in 2018.

President Donald Trump, declaring that years of U.S. support for free trade had cost America jobs, last year slapped import taxes on foreign dishwashers, solar panels, steel, aluminum and $250 billion in Chinese products. Other countries retaliated with tariffs of their own in disputes that have yet to be resolved.

The exchange of tariffs is taking a toll on world trade. The bank predicts that the growth of world trade will slow to 3.6 percent this year from 3.8 percent in 2018 and 5.4 percent in 2017. Slowing trade is hurting manufacturers around the world.

Rising interest rates

Rising interest rates are also pinching emerging-market governments and companies that borrowed heavily when rates were ultra-low in the aftermath of the 2007-2009 Great Recession. As the debts roll over, those borrowers have to refinance at higher rates. A rising dollar is also making things harder for emerging-market borrowers who took out loans denominated in the U.S. currency.

“Now debt service is eating into government revenues, making it more difficult (for governments) to fund essential social services,” said World Bank CEO Kristalina Georgieva, who will replace bank president Jim Yong Kim on an interim basis when he leaves at the end of January.

The bank slashed its forecast for 2019 growth for Turkey, Argentina, Iran and Pakistan, among others.
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Hospitals in Zimbabwe are turning away patients as a strike by doctors enters its sixth week. There is no end in sight to the strike, as President Emmerson Mnangagwa’s government says it cannot meet the doctors’ demands.

The Parirenyatwa Group of Hospitals, Zimbabwe’s largest treatment center, is largely empty as a doctors’ strike that began December 1 drags on.

Sixty-nine-year-old Kasirina Zibveka had a lung infection in September, according to her medical records. After numerous tests were done, it was confirmed that her right lung had gone bad and needed to be removed.

But by then, doctors were on strike. She was discharged December 13 and was told to return Monday for the ailing lung to be removed. But with the strike unresolved, that did not happen.

Her daughter, Margret Chikoti, says the family has paid for her treatment, but only nurses are attending to her mother.

“We have no idea what is really happening to her since December 13,” she said. “All we see is her discharging some blood stained stinking fluids [through a hole pierced by nurses under her right breast]. What is happening inside her body? Is it getting worse? We just give her painkillers and use ointment to clean her wound. We hope that their negotiations [doctors and government] bear fruit and they return to work.”

Doctors held a meeting Monday and resolved to remain on strike until their demands are met. The doctors want the government to equip hospitals with modern technology, sufficient medicine and protective clothing for doctors.

They also want to be paid in U.S. dollars instead of Zimbabwe’s depreciating currency, known as bondnotes.

“We will not accept the money that they are refusing. We want the money that buys,” Zimbabwe Hospital Doctors Association Vice President Marambire Sinaravo Jongwe said this to his members. “We are very understanding people, we are very lenient to our government. They are just trying to ignore us, they are very insincere to doctors. But yet we are saving the public, the general of Zimbabwe. For our patients we care, the government does not care.”

The doctors also say they do not want to prescribe drugs that are not in stock, a practice that forces patients to seek out black market drugs.

The Medicines Control Authority of Zimbabwe has warned about such drugs being fake, expired and unsafe to use.

The government, meanwhile, said last week it is not in a position to pay doctors or any civil servants in U.S. dollars.

Officials say they have imported medicines and are now stocking hospitals. But with doctors still on strike, that news might not be enough to help patients like Kasirina Zibveka.
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U.S. Commerce Secretary Wilbur Ross said there is “a very good chance” that the United States and China will reach a trade agreement. 

Ross told CNBC he is hopeful such a deal would address “all the key issues.”

Working-level trade talks between the United States and China began Monday in Beijing with negotiators for the world’s two biggest economies trying to resolve tariff disputes that have roiled world markets in recent weeks.

In a sign the meeting was off to a good start, China’s economic czar, Vice Premier Liu He, dropped by the talks on Monday to encourage the negotiators.

While Chinese officials expressed optimism at the start of the two-day talks, Beijing at the same time complained about the sighting of the U.S.S. McCampbell, a warship, in what it said were Chinese waters near disputed islands in the South China Sea.

Chinese Foreign Ministry spokesman Lu Kang said China had made “stern complaints” with the United States about the sighting of the destroyer, but the trade talks went ahead as scheduled.

There was no immediate U.S. response to the Chinese complaint.

Few details have emerged from the trade talks, which are scheduled to run through Tuesday.

​The trade talks are the result of an agreement last month between U.S. President Donald Trump and Chinese President Xi Jinping to stop the tit-for-tat tariff conflict between the two countries for 90 days starting on New Year’s Day. 

Trump said last week, “I think we’ll have a deal with China.” 

Lu said the two countries have agreed to hold “positive and constructive” discussions.

“From the beginning we have believed that China U.S. trade friction is not a positive situation for either country or the world economy,” Lu said. “China has the good faith, on the basis of mutual respect and equality, to resolve the bilateral trade frictions.”

​The talks are occurring as Chinese growth — 6.5 percent in the July-to-September period — fell to its lowest point in a decade. There are concerns that U.S. growth, 3.4 percent in the third quarter, is also slowing even as the country’s unemployment rate remains nearly at a five-decade low.

Even so, Lu said, “China’s development has ample tenacity and huge potential. We have firm confidence in the strong long-term fundamentals of the Chinese economy.”

The United States has long complained about access to the vast Chinese market and Beijing’s demands U.S. companies reveal their technology advances.
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Mexican President Andres Manuel Lopez Obrador said on Monday that his crackdown against fuel theft was yielding positive results, even as the intervention sparked severe fuel shortages in parts of the country and long lines of angry motorists.

In a bid to eliminate years of mounting theft, state oil firm Pemex has changed its distribution, triggering shortfalls in at least six states, including Guanajuato, a major car-making hub in central Mexico.

Guanajuato’s state government said that less than one third of the state’s gas stations were open on Monday.

Lopez Obrador told a news conference the government had not established a date for when operations would return to normal, but stressed that supply was not in danger.

“We are changing the whole distribution system, that’s the reason for the shortage. We have enough gasoline,” he said.

Mexican television showed long lines of drivers waiting to fill up in central states as well as Jalisco in the west and Tamaulipas in the north.

Years of fuel theft by criminal groups and others by tapping pipelines and stealing tanker trucks has led to losses totaling billions of dollars for public coffers.

Lopez Obrador’s government has ordered the armed forces to intervene in Pemex’s facilities, including one refinery.

“The supply will normalize, and at the same time we are going to guarantee that fuel is not stolen,” said Lopez Obrador, who took office in December. “We have seen a reduction in theft like never before … but we still have work to do.”

Guanajuato’s governor Diego Sinhue told local radio that of the state’s 415 gas stations, only 115 were open. In Leon, Guanajuato’s biggest city with a population of more than 1.5 million, only 7 of 196 stations were open on Sunday, he said.

“Fuel is becoming a serious problem,” said Sinhue, a member of the opposition center-right National Action Party (PAN). “People are really angry about this shortage.”

Sinhue said the army had informed him it had taken control of the state’s Salamanca refinery on Monday morning. There, members of the armed forces were monitoring tankers going in and out of the facility, as well as the pressure of pipelines.

Energy Minister Rocio Nahle offered an apology on Mexican radio for the shortages. Asked when the problem would be fixed, she said it was in the process of being “normalized.”
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India’s cabinet on Monday backed proposals to reserve 10 percent of government jobs for Indians outside the higher income brackets, a plan the main opposition party suggested was an attempt by the government to lure back voters as an election nears.

The initiative is expected to mainly benefit the upper echelons of India’s centuries-old Hindu caste system, which has traditionally been a core voter base for Prime Minister Narendra Modi’s Hindu nationalist Bharatiya Janata Party.

Modi must call a national election by May and was dealt a setback in December when the BJP lost power to the opposition Congress party in three states, its biggest defeat since he took office in 2014.

Two BJP sources said the quota plan would benefit people from other religions not covered by existing affirmative action — the reason why lower caste Hindus and India’s indigenous tribes were excluded from it.

According to the government bill, the recipients must also be classed as “economically weak,” which the sources said was defined as anyone with annual income below 800,000 rupees ($11,500) and owning fewer than five acres of land.

In 2017, the average income in India was $1,939.60, according to the World Bank.

The states the BJP lost included Rajasthan, one of four — the others being Maharashtra, Gujarat and Haryana — in which upper caste land-owning farming communities have held large protests in recent years demanding quotas for government jobs.

More broadly, Modi has been criticized for failing to deliver jobs for young people and better conditions for farmers.

“The … Modi government has suddenly woken up to the woes of [the] economically poor, facing imminent defeat in the 2019 elections,” Congress spokesman Randeep Singh Surjewala said of the quota plan.

“Creating reservations in jobs may just prove to be one more ‘Jumla’ [gimmick] for the purpose of election promises.”

Ashwini Kumar Choubey, junior health minister and a BJP member, welcomed the proposal, calling it “historic.”

Caste system

Hindus, who account for about four-fifths of India’s 1.3 billion people, were traditionally grouped into thousands of castes, whose membership is determined by birth.

The lower castes have faced various forms of discrimination including segregation and social boycotts.

There have been attempts to reduce caste-related inequality, and the country has had many lower caste leaders, including current president Ram Nath Kovind.

But introducing quotas for lower castes has always been a contentious issue and has led to violent protests, though India’s income levels and expenditure patterns remain largely linked to caste.

The government is expected to submit the quota bill to the lower house of parliament on Tuesday. Modi’s BJP has a majority there, but not in the upper house.
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U.S. Commerce Secretary Wilbur Ross predicted on Monday that Beijing and Washington could reach a trade deal that “we can live with” as officials from the world’s two largest economies resumed talks in a bid to end their trade dispute.

Ross told CNBC the immediate trade issues would be easiest to tackle while enforcement issues and structural reforms, such as intellectual property rights and market access, would be more challenging to resolve.

“I think there’s a very good chance that we will get a reasonable settlement that China can live with, that we can live with and that addresses all of the key issues,” Ross said in an interview with CNBC.

China’s Foreign Ministry said Beijing had the “good faith” to work with the United States to resolve trade frictions as Chinese officials met their U.S. counterparts in Beijing for the first face-to-face talks since U.S. President Donald Trump and Chinese President Xi Jinping agreed in December to a 90-day truce in a trade war that has roiled global markets.

Trump said on Sunday that trade talks with China were going very well and that weakness in the Chinese economy gave Beijing a reason to work toward a deal. Ross told CNBC the talks were being held with appropriate-level staff and would help determine how the administration moves forward.

The two sides agreed to hold “positive and constructive” dialogue to resolve economic and trade disputes in accordance with the consensus reached by their respective leaders, Foreign Ministry spokesman Lu Kang told a regular news briefing.

“From the beginning we have believed that China-U.S. trade friction is not a positive situation for either country or the world economy. China has the good faith, on the basis of mutual respect and equality, to resolve the bilateral trade frictions.”

Trump imposed import tariffs on hundreds of billions of dollars of Chinese goods last year and has threatened more to pressure Beijing to change its practices on issues ranging from industrial subsidies to intellectual property to hacking. China has retaliated with tariffs of its own.

“As for whether the Chinese economy is good or not, I have already explained this. China’s development has ample tenacity and huge potential,” Lu said. “We have firm confidence in the strong long-term fundamentals of the Chinese economy.”

Lu also said Vice President Wang Qishan would attend the annual World Economic Forum in Davos, Switzerland in late January, but added that he had not yet heard of any arrangements for a meeting with Trump there.

By Monday evening, few details had emerged of the trade talks, which were scheduled to run through Tuesday.

Although the talks were held at a vice-ministerial level, Chinese Vice Premier Liu He, who has led trade negotiations with the United States and is a top economic adviser to Xi, made an unexpected appearance at the meetings Monday, according to a person familiar with the discussions.

The U.S. delegation, led by Deputy U.S. Trade Representative Jeffrey Gerrish, includes under secretaries from the U.S. departments of agriculture, commerce, energy and treasury, as well as senior officials from the White House.

No ‘white flag’

Tu Xinquan, a Chinese trade expert at Beijing’s University of International Business and Economics, told Reuters before talks began that the meetings would likely focus on technical issues and leave major disagreements to more senior officials.

“China’s economy is significantly slowing down, and the U.S. stock market is declining quickly. I think the two sides need some kind of agreement for now,” Tu said.

Data last week showed manufacturing has slowed in both China and the United States, though the U.S. Labor Department on Friday reported a surge in new jobs in December along with higher wages.

Officials have given scant details on concessions that China might be willing to make to meet U.S. demands, some of which would require structural reforms unpalatable for Chinese leaders.

Even if a trade agreement is reached soon, analysts say it would be no panacea for China’s economy, which is expected to continue decelerating in coming months.

China’s stridently nationalist Global Times tabloid said in an editorial late Sunday that statements from both sides that they hoped to reach a deal were cause for optimism, but that Beijing would not cave in to U.S. demands.

“If China was going to raise the white flag, it would have done it already,” the paper said.
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The trappings of success continue to arrive for K-pop sensation BTS, the latest a contract with the toy company Mattel which secured rights to produce dolls of the boy band.

And Mattel is not beyond riding those K-pop coattails. Shares of Mattel Inc. spiked almost 9 percent Monday, a day after the toymaker announced a global licensing agreement that also includes collectible figures and games.

The South Korean boy band, made up of members RM, Jin, SUGA, j-hope, Jimin, V and Jung Kook, last year became the first Korean pop group to reach No. 1 on the Billboard top 200.

BTS is an acronym of Bangtan Sonyeondan or “Beyond the Scene.” The band debuted in June 2013.
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