Aurelia Butler

JOHANNESBURG/HONG KONG (Reuters) – Chinese financial institutions lent $1.34 trillion to developing countries from 2000 to 2021, U.S. researchers at AidData said in a report that showed the world’s biggest bilateral lender switching from infrastructure to rescue lending.While lending commitments peaked at almost $136 billion in 2016, China still committed to almost $80 billion of loans and grants in 2021 according to the data, which captures almost 21,000 projects in 165 low and middle income countries as probably the most comprehensive dataset of its type.Overseas finance has won Beijing allies across the developing world, while drawing criticism from the West and in some recipient countries, including Sri Lanka and Zambia, that infrastructure projects it funded saddled them with debt they were unable to repay.Both the sources and the focus of China’s overseas financing, have changed, the data showed.In 2013, when President Xi Jinping launched the Belt and Road Initiative to build infrastructure across the developing world, China’s policy banks accounted for over half of the lending. Their share started falling from 2015 and was 22% by 2021.The People’s Bank of China and the State Administration of Foreign Exchange (SAFE), which manages China’s foreign currency reserves, accounted for more than half of lending in 2021, almost all bailout lending.”Beijing is navigating an unfamiliar and uncomfortable role— as the world’s largest official debt collector,” said the report by AidData, a research lab at William and Mary university.Much of China’s growing rescue lending is denominated in renminbi, the report found, with loans in the Chinese currency overtaking U.S. dollars in 2020. Overdue payments to Chinese lenders have also risen. One way China is managing repayment risk is through foreign currency cash escrow accounts it controls, AidData said. The arrangement is controversial because it gives China debt seniority, meaning other lenders, including multilateral development banks, could get paid second during any coordinated debt relief.AidData identified 15 countries, primarily in Africa, with escrow accounts totalling a combined $2.5 billion at their peak in June 2023.Brad Parks, the study’s lead author, said they were not able to identify all such accounts, as they are normally kept private. He noted, though, that they had found collateralised loans worth $614 billion and that cash was the main source of collateral required by Chinese lenders, indicating that the amount in escrow accounts could be far higher than $2.5 billion.China is also working more with multilateral lenders and Western commercial banks. Half of its non-emergency lending in 2021 was syndicated loans, 80% of that alongside Western banks and international financial institutions.The destinations of Chinese overseas lending have also changed. Loan commitments to African countries fell from 31% of the total in 2018 to 12% in 2021, while lending to European countries almost quadrupled to 23%.A different dataset showed loan commitments to African countries falling to a 20-year low in 2022. More

Tapestry agreed to buy Capri in August, as the luxury brands looked to consolidate top labels such as Tapestry’s Kate Spade, Stuart Weitzman and Capri’s Jimmy Choo and Versace under one roof to compete with larger rivals such as Paris-listed LVMH in the European luxury market. The companies said on Monday they expect to respond “promptly” to the FTC’s request and aim to close the deal as planned, in 2024.Capri’s shares, which had jumped 55% on Aug. 10 after the deal was announced, were down 2.5% in extended trade. In August, Tapestry warned of weak profit and sales in fiscal 2024 as increased cost of living and still-high inflation has pressured American budgets, denting demand for luxury brands. More

Unifor reached a tentative deal with Stellantis on Oct. 30 after a brief strike at the Franco-Italian automaker’s facilities in Canada.The deal included base hourly wage increases of nearly 20% for production and 25% for skilled trades over the lifetime of the agreement. It also brings back cost-of-living allowances, or COLA, by the end of 2024.The agreement was ratified after positive votes from members at Stellantis facilities in Windsor, Brampton, Etobicoke, Mississauga and Red Deer.Among the Detroit Three automakers in Canada, Stellantis employs the most number of workers and produces some of its popular vehicles such as the Dodge Charger and Challenger, which are made in its Brampton assembly plant in Ontario.Unifor used the “pattern bargaining” approach in its talks with the automakers, reaching a deal first with Ford (NYSE:F) and General Motors (NYSE:GM).Meanwhile, more-than-a-month old strike by the United Auto Workers (UAW) union against the Detroit Three automakers in the United States also ended in October. The agreements are awaiting ratification by the union.Unifor, like UAW, sought improved wages and pensions, support in the transition to electric vehicles and additional investment commitments from the automakers.As Stellantis prepares to introduce more than 25 battery-electric vehicles in Canada and the United States by the end of the decade, the company’s operations in Canada will continue to play a critical role, it said in a statement. More

“Undertightening will not get us back to 2% in a reasonable time,” Kashkari said in an interview with the Journal.Kashkari said he needed more information to come to a firm decision on interest-rate steps moving forward. “I am not ready to say we are in a good place,” he told Journal. More

Noboa, 35, has pledged to rebuild the South American country’s ailing economy, create jobs and work to quell rising crime and violence largely blamed on organized crime.Since 2017, Moya, one of six ministers announced to date, has been a senior official with the interior ministry, most recently as the coordinator for planning and strategic management, with a focus on investment projects.Her announcement came as Noboa, the heir to a family banana business and a former one-term congressman, is visiting the United States, meeting with officials, business leaders and investors, according to a statement from his press office.Moya will serve in a cabinet that the incoming president has pledged will feature an equal number of women and men.Noboa faces the challenge of a local economy that has struggled since the coronavirus pandemic, pushing thousands of Ecuadoreans to migrate.Since he was elected in a special election after former President Guillermo Lasso dissolved Congress in order to avoid a vote to remove him from office, Noboa will have just 17 months to govern, serving a shortened term that will run through May 2025.In October’s run-off election, Noboa won about 52% of the vote, besting leftist adversary Luisa Gonzalez’s 48% support. More

The carrier in October had flagged a nominal financial impact in the first half of 2024 related to the engine issue.Pratt & Whitney said in July more than 1,000 engines must be removed from Airbus planes and checked for microscopic cracks.Air New Zealand warned in September the engine inspections would have a “significant” impact on its flight schedule from next year.The airline said on Tuesday it would pause flights connecting Auckland and Hobart from April 5 next year. It also plans a “service pause” for flights between Auckland and Seoul from the beginning of April.Air New Zealand added it will have to ground up to four aircraft at any one time due to the engine maintenance issues.The carrier said it will look at leasing additional aircraft, with the airline’s latest leased 777-367ER aircraft about to enter service.”The company is also managing other supply chain issues which airlines globally are facing as it looks to put additional fleet cover in place,” Air New Zealand CEO Greg Foran said.The airline has 17 A320/321neo jets in its fleet of 108 aircraft, servicing Australia and the Pacific Island markets and the domestic market in New Zealand.Air New Zealand’s shares fell as much as 1.5% to NZ$0.67. More