Aurelia Butler

WASHINGTON (Reuters) – Importers of technology products from China paid over $32 billion worth of tariffs imposed by President Donald Trump between mid-2018 to the end of 2021, a new trade group report showed on Tuesday as the Biden administration continues to deliberate over whether to remove some duties.The Consumer Technology Association said in the report https://www.cta.tech/Resources/Newsroom/Media-Releases/2022/July/China-Tariffs-Slowed-US-Tech-Manufacturing-and-Job that the tech industry has reduced its dependence on China in the wake of the tariffs, but this has been offset by increased imports from Vietnam, Taiwan, South Korea, Malaysia and other countries.Roughly half of the $32 billion in tariffs were paid on Chinese-produced computers and electronic products, CTA said. Total “Section 301” tariffs paid on Chinese goods through July 13 totaled $145.43 billion, according to Customs and Border Protection data https://www.cbp.gov/newsroom/stats/trade.The report comes as the Biden administration is trying to determine whether to remove some of the tariffs as a way to provide American consumers relief from high inflation, which remained low during the first two years that the tariffs were imposed.Ed Brzytwa, CTA’s vice president of international trade, said in a statement that the tariffs were hurting U.S. businesses, not solving China trade challenges. “With rising prices across all sectors of our economy, removing tariffs would mitigate rampant and harmful inflation and lower costs for Americans,” he said. CTA’s review of import trends since the tariffs were first imposed in phases in mid-2018 show that imports of Chinese tech goods hit by Section 301 tariffs fell by 39% over the next three and a half years, while those not affected grew by 35%.China’s share of U.S. imports of tech products hit by the tariffs roughly halved to 17% in 2021 from 32% in 2017, CTA said. About half of the $32 billion in tariffs were for computers and electronics products. The group said there was no such shift tech products unaffected by tariffs, with China accounting for 84% of U.S. imports in these categories in both 2017 and 2021.But some imports of Chinese produced consumer tech goods were higher in 2021 than 2017 despite the tariffs, suggesting that the motivation among some companies to “leave China” had abated. Among these were digital cameras, certain cooking appliances and vacuum cleaners including robot vacuums. More

Before Sri Lanka’s economy collapsed, 50-year-old Nazir would spend scorching hot days hauling carts packed with rolls of fabric, stacks of coconuts and sacks of garlic through the narrow streets of Colombo’s Pettah market. Now, wearing a black cap, T-shirt and grey trousers, Nazir sits idle in front of dozens of empty carts, listening to speeches on his mobile phone. He turns up the volume and points to the screen: “Aragalaya!,” referring to Sri Lanka’s popular revolt that ousted its president last week.On a good day, Nazir used to make the equivalent of $8, just about enough to feed his family of six, for which he is the breadwinner. “Now, the business is dead,” he said. If he gets no more work today, he will go back home with less than a dollar in his pocket.Sri Lanka’s economic collapse has been blamed on former president Gotabaya Rajapaksa, who flew to Singapore after initially fleeing the country on a military jet to the Maldives as a wave of protests rocked the island nation. Demonstrators were furious at the president for borrowing heavily to build Chinese-backed projects and his eccentric policymaking, which included a ban on fertiliser imports.Erratic economic management was compounded by a drop in tourism revenue because of the coronavirus pandemic and the war in Ukraine, which caused Sri Lanka to default and sent its currency tumbling. Sri Lanka, which has run out of foreign currency, has experienced severe fuel shortages, leading to kilometres-long queues for petrol © Arun Sankar/AFP/Getty ImagesSri Lanka’s debt pile stands at $51bn, just over half of which is owed to bilateral and multilateral lenders including China.The economic fallout has had devastating consequences. “My family is skipping meals,” said Nazir. “At dinner, we share pieces of bread with coconut sambal. I use firewood to cook because there is no fuel and no kerosene.” Stories like Nazir’s reverberate across the Pettah market, which used to be a teeming maze of clothing boutiques and stalls selling everything from the latest electronics and dish washing liquid to spices and coffee.But the half-empty streets surrounding the nation’s most important market, set directly behind the Colombo port, are an indication of a failing Sri Lanka, which has been battered by soaring prices, growing unemployment, poverty and hunger. With foreign currency reserves depleted, the nation of 22mn has run out of money to import fuel, leading to queues kilometres long at petrol stations. The fuel shortage has effectively driven many people out of work and forced the country’s schools, offices and companies to shut.Across the market, MT Niyas, 55, drinks his second coffee of the day at Lucky Cool Spot, a café serving labourers with buns, hot drinks and cigarettes sold individually. His sunburned body covered from head to toe in flour, Niyas said his daily wage for carrying sacks on his back had more than halved to SLRs2,500 ($7) as trucks stopped coming, while bus fares doubled to 70 rupees. “I’ve been working here since 1981 and this is the worst it has ever been,” said Niyas. “It’s good that the old president is gone. All we ask of whoever takes his place is that we can have three full meals a day. It can’t be that hard!”MT Niyas: ‘All we ask . . . is that we can have three full meals a day’ © Antoni Slodkowski/FTNisham, the bearded 26-year-old proprietor, chimes in as he clears tables for new customers, returns change and pours fresh tea: “Workers would pop in maybe 10 times during a long day for a quick tea or to chat. Now, they come by maybe twice a day.” He rattles off staggering price increases in the last quarter: the price of milk powder trebled to SLRs3,000 per kg, while those of sugar and even tea, which Sri Lanka exports across the globe, have more than doubled. Nisham speaks openly about his hatred for the Rajapaksa family, who dominated Sri Lankan politics for decades. But there is also a hint of hurt pride, echoed in many other conversations. “We have many natural resources in our beautiful country: tea, rubber, coffee, gems,” he said. “We should be able to do better than this.” He and his fellow shopkeepers complained that shadow brokers had stepped in to fill the void after banks stopped lending money. A 65-year-old woman named Aruna, who sells curry leaves, said she borrowed SLRs10,000 to keep her business afloat. But she has to pay back SLRs1,000 a day for 12 days. Day labourers such as those at Lucky Cool Spot are among the hardest hit, but they are hardly an exception. The World Food Programme said 3mn people are receiving emergency humanitarian aid after food inflation hit 80 per cent last month. Almost 90 per cent of all households skip meals or are skimping to make food last longer, the organisation added.

Afzal Fasehudeen, a construction engineer who came to Pettah to stock up on leeks and carrots, had no doubt about who was to blame for the crisis.“This whole demise was caused by massive mismanagement and a total lack of proper planning. The Rajapaksas started construction projects right, left and centre — that’s ridiculous,” said Fasehudeen. With the construction boom screeching to a halt, Fasehudeen said that he and many of his friends who finished university two years ago were planning to leave the country.“My company may go bankrupt soon. I don’t want to leave, but if nothing changes over the next few months I will try to find a job in one of the Gulf countries,” said Fasehudeen.“Everything is going up — but not income. People are angry.” More

SYDNEY (Reuters) – Australia’s top central banker on Wednesday indicated a steady drum beat of interest rate rises were needed to stop a damaging inflationary cycle developing, and suggested rates could at least double from current low levels.The warning came as the central bank faces the first independent inquiry into its operations since the 1990s, amid criticism of its inflation and policy forecasting.In a speech at a business conference in Melbourne, Reserve Bank of Australia (RBA) Governor Philip Lowe said it was crucial that high inflation not feed through to business and household expectations and become a self-fulfilling cycle. He suggested rates might need to rise to a neutral level of at least 2.5%, from the current 1.35%, to curb inflation which is running at a 20-year peak of 5.1%.”For inflation to return to the 2%–3% target range, a more sustainable balance between demand and supply is needed. Higher interest rates will help achieve this,” Lowe said.The RBA has already raised rates for three months in a row and markets are wagering on further hikes to near 3.5% by the end of the year.Lowe’s (NYSE:LOW) sober outlook comes as the newly elected Labor government released details of a long-planned review of the central bank looking into its Board structure, operations and methods of communication with the public.The RBA has faced criticism for forecasting rates would stay at an emergency low of 0.1% out to 2024, only to reverse course and start hiking in May as inflation surged past expectations.The central bank also undershot its 2%-3% inflation target for much of the previous decade, leading the IMF to suggest that policy had been too tight during those years.Treasurer Jim Chalmers said the review, which is due to report by March, was not about “taking pot shots” at the RBA but rather to see if there were better ways to formulate and conduct monetary policy. Lowe said the bank’s Board and staff welcomed the review.”The terms of reference are appropriate and the government has appointed a first-class panel,” he said. “It is an opportunity to take stock of our monetary policy arrangements and make sure that they are fit for purpose for the challenges ahead.”Lowe also defended the RBA’s aim of keeping inflation within a 2-3% band over the long term, saying a flexible target for consumer prices was widely accepted as the right framework by central banks around the world. More

COLOMBO (Reuters) – Sri Lanka’s parliament will choose between three candidates for president on Wednesday, hoping the new leader will be able to pull the island out of its worst economic and political crisis since independence in 1948.But a win for acting President Ranil Wickremesinghe, one of the main two contenders but opposed by many ordinary Sri Lankans, could lead to more demonstrations by people furious with the ruling elite after months of crippling shortages of fuel, food and medicines.Ruling-party lawmaker Dullas Alahapperuma, a former journalist, is more acceptable to the protesters and the opposition but does not have any top-level governance experience in a country with barely any dollars for imports and desperately in need of an IMF bailout.The third candidate, Anura Kumara Dissanayaka, the leader of the leftist Janatha Vimukti Peramuna party, commands only three seats in parliament and has no realistic chance of winning.Wickremesinghe, a six-time prime minister, became acting president last week after the then incumbent, Gotabaya Rajapaksa, fled to Singapore when protesters seized his official residence and office, roaming the corridors, using his gym and swimming in his pool.Protesters also burned down Wickremesinghe’s private home and stormed his office, but failed to oust him. Wickremesinghe said this week that by the time he joined the current government as prime minister in May, the economy had already collapsed.Sri Lankans have blamed the Rajapaksas – seven from the family were in the government as of April – for the meltdown. Their decisions to cut taxes and ban chemical fertilisers, which damaged crops, decimated the debt-laden economy that was badly exposed by the COVID-19 pandemic.It was not immediately clear how much support 73-year-old Wickremesinghe, seen as an ally of the Rajapaksa clan, and 63-year-old Alahapperuma have in the 225-seat parliament.Wickremesinghe is backed by a section of the ruling party that had a total of 145 seats as of the last parliamentary election in 2020. Alahapperuma has the support of the other section as well as the main opposition party that won 54 seats last time round.Latest numbers are not clear because some lawmakers have become independents.”Earlier Ranil Wickremesinghe was the front-runner but now the outcome is much more uncertain,” said political scientist Jayadeva Uyangoda.”The balance of parliament power has shifted away from him. The outcome is dependent on how much control the Rajapaksas have … over their party members.”Sri Lanka’s parliament in 1993 unanimously chose D.B. Wijetunga to finish the tenure of assassinated President Ranasinghe Premadasa. This time three candidates are in the fray to complete Rajapaksa’s term, scheduled to end in 2024.”It will be marked as a new experience in the parliamentary history of this country,” a statement from the communication chief of parliament said, laying out the procedure.A candidate receiving more than one-third of the valid votes cast will be declared elected. If no candidate reaches the mark, the one with the lowest number of votes will be eliminated from the competition and preferences of lawmakers taken into account to eventually arrive at a winner.Whatever the process, protesters are clear they want Wickremesinghe gone. Wickremesinghe, for his part, imposed a state of emergency on Monday, giving him more powers to launch a crackdown should he feel the need.”We are protesting again Ranil. He is a corrupted man,” said Duminda Nagamuwa, who organised protests in Colombo after the nominations were finalised.”If Ranil comes (into power), we cannot have stability.” More

Nearly two thirds of chief financial officers quizzed by Deloitte thought a recession was coming in the next 12 months caused by the surge in inflation which almost 90% of the CFOs said would exceed 2.5% in two years’ time.That represented a sharp slowdown in price growth of more than 9% now, but was the highest share since the question was first asked in 2013.Higher input costs were being passed on to clients although companies were also cutting profit margins.The Bank of England is watching closely for signs that high inflation is becoming embedded in the economy and it has signalled that it is prepared to raise interest rates by more than its usual quarter percentage-point moves if needed.Most of the CFOs thought the BoE would double rates to 2.5% over the next 12 months.Cost reduction was the top priority for the executives taking part in the quarterly survey, which is often cited by the BoE in its reports on the British economy.Ian Stewart, chief economist at Deloitte, said companies were building up cash as they prepared for a recession. But their investment intentions, while lower than in recent surveys by Deloitte, were higher than in the run-up to previous sharp downturns in the economy. “They’re certainly expecting tough times ahead but there are elements which also suggest that they’re looking through that,” Stewart said. “Given developments in the last three months and the scale of the change in expectations for growth, you might have expected a bigger move.”The survey showed that worries about Brexit had been revived by Prime Minister Boris Johnson’s push for unilateral changes to the trading rules for Northern Ireland which raised the prospect of trade tensions with the European Union. The survey of 77 CFOs – 15 of them from FTSE 100 firms and 32 from FTSE 250 companies – was conducted between June 16-30. More

The government’s 5 per cent pay offer to public sector workers was an attempt to address a host of pressing problems — staff shortages, looming strike action, rising inflation and the squeeze on household budgets — while still leaving the next UK prime minister enough fiscal firepower to cut taxes. In the event, it has pleased no one.But the government’s partial concession to workers’ demands reflects the fact that market forces, as much as union activism, are now driving wage growth with inflation above 9 per cent and rising.A worsening economic outlook has not yet taken the heat out of the UK’s labour market, with Office for National Statistics figures showing unemployment still below pre-pandemic levels, redundancies at record lows and vacancies — while nearing a peak — at a new high of 1.3mn.Against this backdrop, many private sector employers have already been forced to raise wages sharply in order to recruit and hold on to staff. Business leaders giving evidence to MPs on Tuesday said pay awards were now running at 6 to 7 per cent, with many negotiating a mid-year increase to compensate workers for rising living costs, on top of the usual annual uplift.

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The ONS data showed private sector pay grew almost five times as fast as that of public sector workers in the year to May, partly because businesses in many sectors — not just financial services — have been making freer use of one-off recruitment and retention bonuses.“It is markets, not militancy, pushing pay higher,” said Tony Wilson, director of the Institute for Employment Studies, who notes that wages have risen fastest in sectors such as hospitality and IT where the number of vacancies has been highest — with the public sector lagging far behind.Ministers’ decision to endorse pay deals for 2.5mn public sector workers averaging about 5 per cent reflects a recognition that such a big gap between the private and public sectors is no longer tenable — with recruitment problems worsening across key services and the threat of strike action looming.

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The government claimed most overall pay awards in the public sector would be similar to those in the private sector, and argued that it could not have gone further without fuelling persistently high inflation, making people worse off in the long run.But the furious response from public sector unions suggests that ministers have not gone nearly far enough to avert the threat of industrial action or to fix recruitment problems. Union leaders described the pay deals for their respective members as “pitiful”, “disappointing”, “wholly inadequate”, a “grave misstep” and “a kick in the teeth”. The British Medical Association said a 4.5 per cent pay rise for doctors who were not covered by existing multiyear pay deals represented a “brutal” real-terms pay cut and “a betrayal of the profession”. Even though pay increases will in most cases be more generous for workers at the bottom end of pay scales, the Trades Union Congress said the NHS settlement would cut hospital porters’ pay by £200 in real terms this year, nurses’ real pay by £1,100 and that of paramedics by more than £1,500. Frances O’Grady, TUC general secretary, said the award would “hit morale at a time when staff are leaving in droves and staff shortages are crippling vital services”. But while the pay awards are not generous enough to defuse the anger felt by many public sector workers, they will cost enough — relative to previous plans — to leave public sector managers facing very difficult decisions, in the absence of any new money from the Treasury.Ben Zaranko, economist at the Institute for Fiscal Studies, said existing spending plans could not readily accommodate 5 per cent pay awards — which would cost around £7bn more than previous plans — but that providing the requisite funding would be “clearly unattractive for a set of would-be prime ministers who all want to cut taxes”.Geoff Barton, general secretary of the Association of School and College Leaders, labelled the pay award for teachers “the worst of all worlds” because teachers would face substantial real-terms pay cuts, while the higher wage bill would worsen already dire pressures on school budgets. Anita Charlesworth, director of research at the Health Foundation, said the new offer to NHS staff meant trusts were presented with “a near impossible task for which they are set up to fail”, as they were already required to make big efficiency savings.She also questioned the decision to focus pay awards on the lowest-paid staff, saying this was understandable given the rising cost of living, but could make it harder for the NHS to retain more experienced staff.Fresh evidence of the pressing need to recruit and retain more staff was highlighted in new research by the Health Foundation on Wednesday. It found that the NHS in England could face a shortfall of around 38,000 full time equivalent registered nurses by 2023-24 if it is to continue to deliver pre-pandemic levels of care. More