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    India’s Economic Figures Belie Covid-19’s Toll

    Strong results compared with last year’s performance mask lingering weaknesses that could hold back needed job creation.NEW DELHI — The coronavirus continues to batter India’s damaged economy, putting growing pressure on Prime Minister Narendra Modi to nurture a nascent recovery and get the country back to work.The coronavirus, which has struck in two waves, has killed hundreds of thousands of people and at times has brought cities to a halt. Infections and deaths have eased, and the country is returning to work. Economists predict that growth could surge in the second half of the year on paper.Still, the damage could take years to undo. Economic output was 9.2 percent lower for the April-through-June period this year than what it was for the same period in 2019, according to India Ratings, a credit ratings agency.The coronavirus has essentially robbed India of much of the momentum it needed to provide jobs for its young and fast-growing work force. It has also exacerbated longer-term problems that were already dragging down growth, such as high debt, a lack of competitiveness with other countries and policy missteps.Economists are particularly concerned about the slow rate of vaccinations and the possibility of a third wave of the coronavirus, which could prove to be disastrous for any economic recovery.“Vaccination progress remains slow,” with just 11 percent of the population fully inoculated so far, Priyanka Kishore, the head of India and Southeast Asia at Oxford Economics, said in a research briefing last week. The firm lowered its growth rate for 2021 to 8.8 percent, from 9.1 percent.Even growth of 8.8 percent would be a strong number in better times. Compared with the prior year, India’s economy grew 20.1 percent April through June, according to estimates released Tuesday evening by the Ministry of Statistics and Program Implementation.But those comparisons benefit from comparison with India’s dismal performance last year. The economy shrank 7.3 percent last year, when the government shut down the economy to stop a first wave of the coronavirus. That led to big job losses, now among the biggest hurdles holding back growth, experts say.The coronavirus continues to batter India’s damaged economy, putting growing pressure on Prime Minister Narendra Modi.Money Sharma/Agence France-Presse — Getty ImagesReal household incomes have fallen further this year, said Mahesh Vyas, the chief executive of the Center for Monitoring Indian Economy. “Till this is not repaired,” he said, “the Indian economy can’t bounce back.”At least 3.2 million Indians lost stable, well-paying salaried jobs in July alone, Mr. Vyas estimated. Small traders and daily wage laborers suffered bigger job losses during the lockdowns than others, though they were able to go back to work once the restrictions were lifted, Mr. Vyas said in a report this month.“Salaried jobs are not similarly elastic,” he said. “It is difficult to retrieve a lost salaried job.”About 10 million people have lost such jobs since the beginning of the pandemic, Mr. Vyas said.Mr. Modi’s government moved this month to rekindle the economy by selling stakes worth close to $81 billion in state-owned assets like airports, railway stations and stadiums. But economists largely see the policy as a move to generate cash in the short term. It remains to be seen if it will lead to more investment, they say.“The whole idea is that the government will borrow this money from the domestic market,” said Devendra Kumar Pant, the chief economist at India Ratings. “But what happens if this project goes to a domestic player and he is having to borrow in the domestic market? Your credit demand domestically won’t change.”Dr. Pant added that questions remained about how willing private players would be to maintain those assets long term and how the monetization policy would ultimately affect prices for consumers..css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-w739ur{margin:0 auto 5px;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-w739ur{font-size:1.25rem;line-height:1.4375rem;}}.css-9s9ecg{margin-bottom:15px;}.css-16ed7iq{width:100%;display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-align-items:center;-webkit-box-align:center;-ms-flex-align:center;align-items:center;-webkit-box-pack:center;-webkit-justify-content:center;-ms-flex-pack:center;justify-content:center;padding:10px 0;background-color:white;}.css-pmm6ed{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-align-items:center;-webkit-box-align:center;-ms-flex-align:center;align-items:center;}.css-pmm6ed > :not(:first-child){margin-left:5px;}.css-5gimkt{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:0.8125rem;font-weight:700;-webkit-letter-spacing:0.03em;-moz-letter-spacing:0.03em;-ms-letter-spacing:0.03em;letter-spacing:0.03em;text-transform:uppercase;color:#333;}.css-5gimkt:after{content:’Collapse’;}.css-rdoyk0{-webkit-transition:all 0.5s ease;transition:all 0.5s ease;-webkit-transform:rotate(180deg);-ms-transform:rotate(180deg);transform:rotate(180deg);}.css-eb027h{max-height:5000px;-webkit-transition:max-height 0.5s ease;transition:max-height 0.5s ease;}.css-6mllg9{-webkit-transition:all 0.5s ease;transition:all 0.5s ease;position:relative;opacity:0;}.css-6mllg9:before{content:”;background-image:linear-gradient(180deg,transparent,#ffffff);background-image:-webkit-linear-gradient(270deg,rgba(255,255,255,0),#ffffff);height:80px;width:100%;position:absolute;bottom:0px;pointer-events:none;}.css-uf1ume{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-box-pack:justify;-webkit-justify-content:space-between;-ms-flex-pack:justify;justify-content:space-between;}.css-wxi1cx{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-flex-direction:column;-ms-flex-direction:column;flex-direction:column;-webkit-align-self:flex-end;-ms-flex-item-align:end;align-self:flex-end;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}“In India, things will decay for the worse rather than improve,” he said, adding that the costs to users of highways and other infrastructure could go up.During the second wave in May, Mr. Modi resisted calls by many epidemiologists, including Dr. Anthony Fauci, the director of the U.S. National Institute of Allergy and Infectious Diseases, to reinstitute a nationwide lockdown.At a vaccination site in India in June. Economists are particularly concerned about the slow rate of vaccinations and the possibility of a third wave of the coronavirus.Saumya Khandelwal for The New York TimesThe lockdowns in 2021 were nowhere near as severe as the nationwide curbs last year, which pushed millions of people out of cities and into rural areas, often on foot because rail and other transportation had been suspended.Throughout the second wave, core infrastructure projects across the country, which employ millions of domestic migrant workers, were exempted from restrictions. More than 15,000 miles of Indian highway projects, along with rail and city metro improvements, continued.On Tuesday, Dr. Pant said India’s growth estimates of 20.1 percent for the April-through-June period were nothing but an “illusion.” Growth contracted so sharply around the same period last year, by a record 24 percent, that even double-digit gains this year would leave the economy behind where it was two years ago.Economists say India needs to spend, even splurge, to unlock the full potential of its huge low-skilled work force. “There is a need for very simple primary health facilities, primary services to deliver nutrition to children,” Mr. Vyas said. “All these are highly labor intensive jobs, and these are government services largely.”One of the reasons Indian governments typically have not spent in those areas, Mr. Vyas said, is that it has been considered “not a sexy thing to do.” Another is the governments’ “dogmatic fixation” with keeping fiscal deficits in control, he said. The government simply can’t rely on private sector alone for creating jobs, Mr. Vyas said.The “only solution,” he said, is for the government to spend and spur private investment. “You have a de-motivated private sector because there isn’t enough demand. That’s what’s holding India back.” More

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    As Lebanon Collapses, Riad Salameh Faces Questions

    People can’t get their money from banks, the currency has crashed and Riad Salameh’s reign at the central bank is facing allegations of fraud.BEIRUT, Lebanon — For decades, Riad Salameh, Lebanon’s central bank chief, was lauded at home and abroad as a financial wizard who kept the economy running and the currency stable despite wars, assassinations and frequent political turmoil.Not anymore.This country at the crossroads of the Middle East is suffering from a collapse of historic proportions: Its banks are largely insolvent, unemployment is soaring, its currency has crashed and many Lebanese blame Mr. Salameh for shortages that have left them struggling to afford food, scrambling to find medication and waiting in long lines to fuel up their cars.Now, Mr. Salameh is being accused of a perhaps more unforgivable sin: enriching himself and his inner circle through years of corruption. Paris anticorruption judges opened an investigation this month into criminal allegations that Mr. Salameh, one of the world’s longest-serving central bank chiefs, fraudulently amassed an outsize fortune in Europe by abusing his power. The judicial investigation follows a preliminary inquiry by the French National Financial Prosecutor’s Office.Prosecutors in Switzerland have asked Lebanese authorities for help with a separate investigation into suspected embezzlement and money laundering linked to Mr. Salameh and his associates.The allegations have caused a sensation in a country enduring a crisis that the World Bank said recently could rank in the top three worldwide over the last 150 years, a “brutal” economic contraction of a magnitude “usually associated with conflicts or wars.”Despite the meltdown, Mr. Salameh, the architect of Lebanon’s monetary policy since 1993, has faced no serious calls for his ouster, even though he oversaw a strategy that required ever more borrowing to pay existing creditors, what some critics have called the world’s largest Ponzi scheme.Riot police officers stood guard in front of the Lebanese central bank in March during a rally against power cuts after two power plants shut down.Wael Hamzeh/EPA, via ShutterstockWhat shields Mr. Salameh from scrutiny at home is his central role in Lebanon’s complex sectarian and often corrupt web of business and political interests. More than 20 interviews with Lebanese, Western and monetary officials, economists and former colleagues of Mr. Salameh’s paint a picture of a brilliant and shrewd yet secretive operator who built an empire inside the central bank and used it to make himself essential to rich and powerful players across Lebanon’s political spectrum.“He is no longer the head of the central bank. He is the accountant for this mafia,” said Jamil al-Sayyed, a member of Parliament and former head of Lebanon’s General Security agency, the body that oversees domestic security and issues identity cards and passports. “He protects them, and in protecting him, they protect themselves.”But the investigations in France and Switzerland pose new threats to his standing.The French judges are investigating a complaint by Sherpa, a French anticorruption group, that accuses Mr. Salameh, his brother Raja Salameh, other relatives and Marianne Hoayek, who heads the central bank’s executive office, of illicitly sweeping funds from Lebanon into Swiss banks and then laundering millions in France through high-end real estate purchases, including luxury property near the Eiffel Tower. The judges have broad powers, which include seeking cooperation from the Lebanese authorities and freezing assets if the origin of their funding appears illegal.Mr. Salameh’s lawyer in France, Pierre-Olivier Sur, said Mr. Salameh disputed the entirety of the allegations.Separately, the Swiss attorney general’s office is examining a web of bank accounts from Switzerland to Panama that it says Mr. Salameh and his brother may have used to shelter the “possible embezzlement” of central bank funds and to “carry out money laundering.”Swiss prosecutors say documents show that Mr. Salameh hired Forry Associates, a brokerage firm owned by his brother, to handle central bank sales of government bonds, and that from 2002 to 2015 the bank transferred at least $330 million in commissions to the firm’s Swiss account. Mr. Salameh has said that the contract was legal.Large sums in the Forry account were moved to Swiss accounts held by Mr. Salameh, and a portion of the money was ultimately used to buy millions of euros’ worth of real estate in France, Germany, Britain and Switzerland, Swiss prosecutors said.At Heaven’s Joy in Beirut, a center for the elderly and people in need. More than half of the country’s 6.7 million people may be living below the poverty line, the World Bank said.Diego Ibarra Sanchez for The New York TimesBeyond the real estate, Swiss prosecutors are looking into allegations that Raja Salameh transferred over $200 million from Forry’s Swiss account to his accounts in Lebanese banks with powerful political ties. Among them was Bankmed, owned by the family of Rafik Hariri, the former Lebanese prime minister who appointed Mr. Salameh as central bank chief, and whose son Saad Hariri is the country’s most prominent Sunni Muslim politician.Neither Mr. Salameh nor his brother or associates have been charged by Swiss or French prosecutors. It is unclear how long the investigations will take.Talk of self-dealing by Mr. Salameh has circulated for years. In the WikiLeaks diplomatic cables, a former U.S. ambassador to Lebanon, Jeffrey Feltman (now special envoy for the Horn of Africa), described Mr. Salameh in 2007 as having “whiffs of rumored corrupt behavior, a penchant for secrecy and extralegal autonomy at the Central Bank.”Mr. Salameh, 70, declined to be interviewed for this article, did not respond to written questions and has denied any wrongdoing. He has repeatedly said he accumulated a personal fortune of $23 million during a 20-year career as a banker at Merrill Lynch before being tapped to head the central bank. Raja Salameh could not be reached for comment.Riad Salameh told CNBC last year before the investigations were announced that he would not resign over Lebanon’s financial troubles because he had a “strategy to get out of this crisis.” He defended his record, saying he had kept Lebanon “afloat while it lived wars, assassinations, civil strife and so on.”“It is really unfair to judge Lebanon as if it was Sweden,” he said.But some Lebanese question how Mr. Salameh can remain at the helm of the central bank. Inflation has surged to 80 percent, overseas investors have left and more than half of the country’s 6.7 million people may be living below the poverty line, the World Bank said.“He is responsible for monetary policy, and it has failed dramatically,” said Henri Chaoul, a former adviser to Lebanon’s minister of finance who resigned last year. “Under what rules of law and governance is he still around?”Rafik Hariri, center, the former Lebanese prime minister who appointed Mr. Salameh as central bank chief.Jamal Saidi/ReutersA polished, canny political operator who is a Lebanese-French dual citizen, Mr. Salameh has been enmeshed in Lebanon’s politics since Rafik Hariri named him central bank governor in 1993. Mr. Salameh had been Mr. Hariri’s private banker at Merrill Lynch.Mr. Hariri was trying to rebuild Lebanon after a disastrous 15-year civil war, and Mr. Salameh set out to stabilize the currency and reel in foreign investment.Mr. Salameh fixed the Lebanese pound at about 1,500 to the dollar, a peg that would underpin the economy for more than 20 years but required a constant stream of dollars to stay sustainable.The system was fragile because it risked collapse if the money ran out. But every time Lebanon faced new crises, external help kept coming. The assassination of the elder Mr. Hariri in 2005 and a destructive war between the Lebanese militant group Hezbollah and Israel in 2006 brought inflows of international aid. Wealthy members of the Lebanese diaspora continually sent foreign currency home.Mr. Salameh’s supporters hailed him as a skilled savior for keeping the economy stable in a country where nothing else seemed to be. As governments came and went, running chronic budget deficits, Mr. Salameh held fast to the money reins.In Lebanon’s sect-based political system, the president must be a Maronite Christian, which Mr. Salameh is, and his reputation as a financial mastermind at one point made him a contender for the country’s highest office. He once told a businessman who asked about his economic plans, “Get me the presidency and I’ll tell you.”Mr. Salameh also used his post to do favors for power brokers in Lebanon’s political system, according to former central bank employees and foreign officials who spoke on the condition of anonymity. Sons of prominent officials got jobs at the central bank. Businessmen, politicians and journalists producing favorable coverage allegedly benefited handsomely from central bank-subsidized loans and other financial arrangements that most likely would have raised red flags with regulators in other countries.But after decades of relative stability, Mr. Salameh’s system began to unravel. By 2015, Lebanon’s ratio of debt to economic output — a measure of debt’s burden on a nation’s economy — was the third highest in the world, at 138 percent; when Mr. Salameh took office, it was 51 percent, ranking 97th. Next door, a civil war was raging in Syria, raising fears of instability.Protesters last month in Beirut took to the streets, angered by deteriorating living conditions and government inaction.Bilal Hussein/Associated PressCommercial banks, saddled with risky Lebanese sovereign bonds, had been required to keep 15 percent of foreign currency deposits in the central bank to shore up its reserves, and Mr. Salameh attracted further deposits with even higher interest rates.Interest rates on dollar deposits at commercial banks also rose, in some cases to 20 percent or higher, to attract dollars in what some analysts describe as a Ponzi scheme, in which new money was always needed to pay creditors.In late 2019, the system came crashing down. Banks imposed limits on withdrawals and the central bank began dipping into its reserves, which included large amounts of depositors’ money, to maintain the currency’s peg to the dollar. Antigovernment protesters set fire to A.T.M.s, and banks locked their doors.“As long as the system was working, no one cared,” said Dan Azzi, a former Lebanese banker. “Now that it has failed, everyone is angry.”The government’s default on a $1.2 billion bond payment in March 2020 underscored the collapse. “Our debt has become greater than Lebanon can bear,” Prime Minister Hassan Diab said in a televised speech.The coronavirus pandemic and a huge explosion in the port of Beirut last August further devastated the economy.Estimates put the central bank’s losses at $50 billion to $60 billion. The International Monetary Fund has offered assistance, but Lebanese officials accuse Mr. Salameh of blocking an audit sought by the United States and other countries that would unlock I.M.F. aid, as well as a separate investigation into alleged fraud at the central bank.Most Lebanese have said goodbye to whatever savings they had while the currency has crashed, reducing salaries once worth $1,000 a month to about $80. The central bank is burning through its reserves, spending about $500 million per month to subsidize imports of fuel, medicine and grain.“Lebanon has been living on borrowed time, and now the chickens have come home to roost,” said Toufic Gaspard, a Lebanese economist and former adviser at the I.M.F. “The whole banking system has collapsed, and we have become a cash economy.”The crash has soured many Lebanese on their once celebrated central banker.“I can’t say anything good about Riad Salameh,” said Toufic Khoueiri, a co-owner of a popular kebab restaurant, while having lunch with a friend in Beirut. “Our money is not stuck in the banks, but simply stolen.”His friend, Roger Tanios, a lawyer, said he had once admired Mr. Salameh for keeping Lebanon financially stable but had changed his mind.Mr. Salameh, he said, had gone spectacularly off course.“Every country has its mafia,” Mr. Tanios said. “In Lebanon, the mafia has its country.”Ben Hubbard reported from Beirut, and Liz Alderman from Paris. 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    U.S. and Europe Look for Tariff Cease-Fire as Biden Heads Overseas

    The Biden administration is trying to ease trade tension with allies, in part to help counter China.WASHINGTON — The United States and the European Union are working toward an agreement that would settle long-running disputes over aircraft subsidies and metals tariffs that set off a trade war during the Trump administration as President Biden looks to re-engage with traditional American allies.The two sides are hoping to reach an agreement by mid-July with a goal of lifting tariffs that both governments have placed on each other’s goods by Dec. 1, according to a joint statement that is being drafted before the U.S.-E.U. summit that Mr. Biden will attend in Brussels next week.Resolving trade tensions with Europe and other allies is a key goal of the Biden administration, which is trying to repair relationships that fractured under President Donald J. Trump, whose provocative approach to trade policy included punishing tariffs. Mr. Biden and other administration officials have said they want to rebuild those relationships, in part so that the United States can work with allies to counter China and Russia.The joint statement suggested an eagerness on both sides of the Atlantic to end a trade fight that has resulted in tariffs on a wide range of goods — including American peanut butter, orange juice and whiskey as well as levies on European wine and cheese.“We commit to make every effort possible to find comprehensive and durable solutions to our trade disputes and to avoid further retaliatory measures burdening trans-Atlantic trade,” the document said.The draft was reported earlier by Bloomberg News.The desire to reach an agreement came as Mr. Biden departed on Wednesday for a summit meeting in Britain with the leaders of the Group of 7 nations, his first international trip as president.As he boarded Air Force One, he indicated that his priority was to mend relations with his counterparts.“Strengthening the alliance and make it clear to Putin and to China that Europe and the United States are tight, and the G7 is going to move,” Mr. Biden said of his goals for the trip.Discussions about easing tariffs come at a critical time for the global economy as countries emerge from the pandemic. Widespread shortages of commodities because of supply chain bottlenecks and growing consumer demand have been pushing up prices and causing concern among policymakers.In March, the United States and European Union agreed to temporarily suspend tariffs on billions of dollars of each other’s aircraft, wine, food and other products as both sides try to find a negotiated settlement to a dispute over the two leading airplane manufacturers.The World Trade Organization had authorized both the United States and Europe to impose tariffs on each other as part of two parallel disputes, which began almost two decades ago, over subsidies the governments have given to Airbus and Boeing. The European Union had imposed tariffs on about $4 billion of American products, while the United States levied tariffs on $7.5 billion of European goods.The two governments are also trying to resolve a fight over the steel and aluminum tariffs that Mr. Trump imposed in 2018. The 25 percent tariffs on imports of European steel and 10 percent on aluminum spurred retaliation from Europe, which imposed similar duties on American products like bourbon, orange juice, jeans and motorcycles.The negotiations come as the United States is broadly reviewing its trade policy with a new focus on multilateralism.Last week, the Biden administration suspended retaliatory tariffs on European countries in response to digital services taxes that they have imposed as negotiations over a broader tax agreement play out.As part of the effort to deepen ties, the United States and European Union plan to establish a trade and technology council to help expand investment and prevent new disputes from emerging. It will also focus on strengthening supply chains for critical technology such as semiconductors, which have been in short supply in the last year.The alliance represents another tool the administration intends to use to push back against China’s growing economic influence, which Mr. Biden has repeatedly referred to as a threat to the United States. While the president has so far steered clear of hitting China with new tariffs, he has yet to remove the levies Mr. Trump imposed on $360 billion worth of Chinese goods. Last week, the administration barred Americans from investing in Chinese companies linked to the country’s military or engaged in selling surveillance technology used to repress dissent or religious minorities.The draft document says, “We intend to closely consult and cooperate on the full range of issues in the framework of our respective similar multifaceted approaches to China.”The U.S.-E.U. summit will take place next Tuesday.Matina Stevis-Gridneff More

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    Senate Passes Bill to Bolster Competitiveness With China

    The wide margin of support reflected a sense of urgency among lawmakers in both parties about shoring up the technological and industrial capacity of the United States to counter Beijing.WASHINGTON — The Senate overwhelmingly passed legislation on Tuesday that would pour nearly a quarter-trillion dollars over the next five years into scientific research and development to bolster competitiveness against China. More

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    Belarus’s forced landing of airliner sends shock waves through industry.

    Some airlines in Eastern Europe began diverting their planes to avoid Belarus airspace on Monday, a day after that country’s leader sent a fighter jet to force down a Ryanair flight, allowing authorities to seize an opposition journalist on board.The shocking move has unleashed a storm of criticism against Aleksandr G. Lukashenko, the Belarus president who has clung to power despite huge protests last year. The European Union is considering penalties against the country. At least two airlines said that they were diverting flights away from Belarus airspace as a precaution, but most carriers seem to be waiting to be told what to do by the European authorities.In an interview on Monday with an Irish radio broadcaster, Ryanair’s chief executive, Michael O’Leary, condemned the actions of the Belarus authorities, who ordered the plane, flying from Athens to Vilnius, Lithuania, to land in the Belarus capital of Minsk and then arrested a dissident journalist on board, Roman Protasevich, and his companion.“This was a case of state-sponsored hijacking, state-sponsored piracy,” Mr. O’Leary told interviewers on Newstalk.Mr. O’Leary, however, said he was waiting for instructions from European Union authorities in Brussels about whether to steer other flights away from Belarus.“We, like all the European airlines, are looking for guidance today from the European authorities and from NATO,” he said.He added that it would be an easy matter for his flights to avoid Belarus. “We don’t fly over Belarus much,” he said. “It would be a very minor adjustment to fly over” Poland instead, he added. Ryanair, a discount airline based in Ireland, describes itself as Europe’s largest airline group.Other airlines are already making changes.AirBaltic, the Latvian national airline, said that its flights would avoid entering Belarus airspace “until the situation becomes clearer or a decision is issued by the authorities.” The rerouted flights include ones from Riga, the airline’s home base, to Odessa in Ukraine and Tbilisi in Georgia.Another airline that flies in the area, Wizz Air, said that it would alter the path of a flight from Kyiv in Ukraine to Tallinn in Estonia so as to skirt Belarus.“We are continuously monitoring and evaluating the situation,” a spokesman for Wizz Air, which is based in Hungary, said. More

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    Seychelles Sees Rise in Coronavirus Cases Despite Vaccinations

    Seychelles has seen a surge in coronavirus cases despite much of its population being inoculated with China’s Sinopharm vaccine.Marie Neige, a call center operator in Seychelles, was eager to be vaccinated. Like the majority of the residents in the tiny island nation, she was offered China’s Sinopharm vaccine in March, and was looking forward to the idea of being fully protected in a few weeks.On Sunday, she tested positive for Covid-19.“I was shocked,” said Ms. Neige, 30, who is isolating at home. She said she has lost her sense of smell and taste and has a slightly sore throat. “The vaccine was supposed to protect us — not from the virus, but the symptoms,” she said. “I was taking precaution after precaution.”China expected its Sinopharm vaccines to be the linchpin of the country’s vaccine diplomacy program — an easily transported dose that would protect not just Chinese citizens but also much of the developing world. In a bid to win good will, China has donated 13.3 million Sinopharm doses to other countries, according to Bridge Beijing, a consultancy that tracks China’s impact on global health.Instead, the company, which has made two varieties of Covid-19 vaccines, is facing mounting questions about the inoculations. First, there was the lack of transparency with its late-stage trial data. Now, Seychelles, the world’s most vaccinated nation, has had a surge in cases despite much of its population being inoculated with Sinopharm.For the 56 countries counting on the Sinopharm shot to help them halt the pandemic, the news is a setback.Seychelles has relied heavily on Sinopharm to inoculate more than 60 percent of its population.Rassin Vannier/Agence France-Presse — Getty ImagesFor months, public health experts had focused on trying to close the access gap between rich and poorer nations. Now, scientists are warning that developing nations that choose to use the Chinese vaccines, with their relatively weaker efficacy rates, could end up lagging behind countries that choose vaccines made by Pfizer-BioNTech and Moderna. That gap could allow the pandemic to continue in countries that have fewer resources to fight it.“You really need to use high-efficacy vaccines to get that economic benefit because otherwise they’re going to be living with the disease long-term,” said Raina MacIntyre, who heads the biosecurity program at the Kirby Institute of the University of New South Wales in Sydney, Australia. “The choice of vaccine matters.”Nowhere have the consequences been clearer than in Seychelles, which relied heavily on a Sinopharm vaccine to inoculate more than 60 percent of its population. The tiny island nation in the Indian Ocean, northeast of Madagascar and with a population of just over 100,000, is battling a surge of the virus and has had to reimpose a lockdown.Among the vaccinated population that has had two doses, 57 percent were given Sinopharm, while 43 percent were given AstraZeneca. Thirty-seven percent of new active cases are people who are fully vaccinated, according to the health ministry, which did not say how many people among them had the Sinopharm shot.“On the surface of it, that’s an alarming finding,” said Dr. Kim Mulholland, a pediatrician at the Murdoch Children’s Research Institute in Melbourne, Australia, who has been involved in the oversight of many vaccine trials, including those for a Covid-19 vaccine.Dr. Mulholland said the initial reports from Seychelles correlate to a 50 percent efficacy rate for the vaccine, instead of the 78.1 percent rate that the company has touted. Sinopharm vaccines being unloaded in Budapest in February. China has donated 13.3 million Sinopharm doses to other countries.Kkm, via Reuters“We would expect in a country where the great majority of the adult population has been vaccinated with an effective vaccine to see the disease melt away,” he said.Scientists say breakthrough infections are normal because no vaccine is 100 percent effective. But the experience in Seychelles stands in stark contrast to Israel, which has the second-highest vaccination coverage in the world and has managed to beat back the virus. A study has shown that the Pfizer vaccine that Israel used is 94 percent effective at preventing transmission. On Wednesday, the number of daily new confirmed Covid-19 cases per million people in Seychelles stood at 2,613.38, compared to 5.55 in Israel, according to The World In Data project.Wavel Ramkalawan, the president of Seychelles, defended the country’s vaccination program, saying that the Sinopharm and AstraZeneca vaccines have “served our population very well.” He pointed out that the Sinopharm vaccine was given to people age 18 to 60, and in this age group over all, 80 percent of the patients who needed to be hospitalized were not vaccinated.“People may be infected, but they are not sick. Only a small number are,” he told the Seychelles News Agency. “So what is happening is normal.”Sylvestre Radegonde, the minister for foreign affairs and tourism, said the surge in cases in Seychelles happened in part because people had let their guard down, according to the Seychelles News Agency. Sinopharm did not respond to a request for comment.A wedding in Kiryat Gat, Israel, in March. Israel, which has the second-highest vaccination coverage in the world, has kept its number of cases down after using the Pfizer vaccine.Dan Balilty for The New York TimesIn a response to an article from The Wall Street Journal on Seychelles, a spokeswoman for China’s foreign ministry blamed Western media for trying to discredit Chinese vaccines and “harboring the mentality that ‘everything involving China has to be smeared.’”In a news conference, Kate O’Brien, director of immunizations at the World Health Organization, said the agency is evaluating the surge of infections in Seychelles and called the situation “complicated.” Last week, the global health group approved the Sinopharm vaccine for emergency use, raising hopes of an end to a global supply crunch.She said that “some of the cases that are being reported are occurring either soon after a single dose or soon after a second dose or between the first and second doses.”According to Ms. O’Brien, the W.H.O. is looking into the strains that are currently circulating in the country, when the cases occurred relative to when somebody received doses and the severity of each case. “Only by doing that kind of evaluation can we make an assessment of whether or not these are vaccine failures,” she said.But some scientists say it is increasingly clear that the Sinopharm vaccine does not offer a clear path toward herd immunity, particularly when considering the multiple variants appearing around the world.Governments using the Sinopharm vaccine “have to assume a significant failure rate and have to plan accordingly,” said John Moore, a vaccine expert at Cornell University. “You have to alert the public that you will still have a decent chance of getting infected.”Wavel Ramkalawan, the president of Seychelles, right, filling out paperwork before receiving his first dose of Sinopharm vaccine in January. He has defended the country’s vaccination program.Rassin Vannier/Agence France-Presse — Getty ImagesMany in Seychelles say the government has not been forthcoming.“My question is: Why did they push everyone to take it?” said Diana Lucas, a 27-year-old waitress who tested positive for Covid-19 on May 10. She said she received her second dose of the Sinopharm vaccine on Feb. 10.Emmanuelle Hoareau, 22, a government lawyer, tested positive for Covid-19 on May 6 after getting the second dose of the Sinopharm vaccine in March. “It doesn’t make sense,” she said. She said the government had failed to give the public enough information about the vaccines.“They are not explaining to the people about the real situation,” she said. “It’s a big deal — a lot of people are getting infected.”Ms. Hoareau’s mother, Jacqueline Pillay, is a nurse in a private clinic in Victoria, the capital. She said she believes there is a new variant in Seychelles because of an influx of foreigners who have arrived in recent months. The tourism-dependent country opened its borders on March 25 to most travelers without any quarantine.“People are very scared now,” said Ms. Pillay, 58. “When you give people the right information, then people would not speculate.”Health officials have recently appeared on television to encourage those who have only taken the first dose of the Sinopharm vaccine to return for the second shot. But Ms. Pillay said she is frustrated that the public health commissioner has not addressed why the vaccines don’t appear to be working as well as they should.“I think a lot of people aren’t coming back,” said Ms. Pillay.Marietta Labrosse, More

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    The Dream: International Travel. The Reality: Chaos and Confusion.

    The world beckons, especially for those who have been vaccinated, but would-be travelers face a difficult moment when travel possibilities are at odds with the facts of a still reeling world.In recent days, a steady stream of promising news has painted a rosy picture of the return of international leisure travel.More than 105 million people in the United States are fully vaccinated. Greece, Iceland and Croatia, among a growing list of countries, are now open to American tourists. Airlines are resuming overseas flights. And perhaps the biggest development of all: Come summer, fully vaccinated Americans will once again be welcome across Europe.But the optimism may be premature. At the moment, the broader reality is more chaotic, and more sobering.A set of swirling crosscurrents — including a surge in global coronavirus cases, lagging vaccine rollouts in tourist hot spots and the lack of a reliable system to verify vaccinations — may be setting the stage for a slow and tortured return to high-volume international travel, despite ambitious pronouncements and the pressures of a tourism industry hoping to avoid another period of economic strain.Reopening areas to vaccinated tourists is a calculated risk, said Dr. Sarah Fortune, the chair of the Department of Immunology and Infectious Diseases at the Harvard T.H. Chan School of Public Health. “My doomsday scenario,” she said, “is a mixing of vaccinated and unvaccinated populations in a setting where there is high viral load and high viral transmission.”At the same time, countries dependent on tourism revenue are pressing to admit more visitors. Most Caribbean countries are open to Americans, pending negative coronavirus tests — and some European countries are not far behind. Travel restrictions in Greece, where tourism accounts for around 25 percent of the country’s work force, were eased in mid-April, allowing for fully vaccinated travelers from the United States, Britain, Israel and European Union member states, among other places, to visit without quarantining or providing negative coronavirus tests. (A broader reopening is planned for later this month.)For now, it’s hard to know whether the travel industry is in the throes of a temporary transition or staring at the long-term complexities of a clash involving wishful thinking, the hard truths of a relentless pandemic and the possibility of responsible tourism.Whatever the case, there’s a churning array of forces affecting the prospects for overseas travel.Checkpoint Charlie in Berlin, which is normally crowded with tourists, was empty during a coronavirus lockdown in November. Germany is now in another lockdown. Lena Mucha for The New York TimesA dire global realityWould-be international travelers, particularly vaccinated Americans, are entering an increasingly chaotic moment when dreams of travel — fueled by more than a year of confinement — are at odds with the facts of a largely shuttered and still reeling outside world.Globally, more new coronavirus cases were reported in recent weeks than at any point since the onset of the pandemic. The numbers are being driven by an uncontrolled outbreak in India, but they also account for troubling trends among European destinations popular with Americans, from France and Germany to Italy and Spain, some of which are now undergoing extended lockdowns and curfews.In Germany, for example, a new round of lockdowns, aimed at combating a third wave of infections, is expected to last until June.Such developments might be hard for Americans to fully appreciate from afar, given the promising trends at home. But government agencies have taken note.In April, the U.S. State Department vastly expanded the list of countries in its “Level 4: Do Not Travel” category, adding, among dozens of destinations, Mexico, Canada and Britain, three of the most popular destinations for Americans. Many Caribbean countries, including the Bahamas, the Dominican Republic and Jamaica, are also at Level 4.In India, which is facing a cataclysmic surge, the presence of a potentially more menacing variant — possibly more dangerous to children, and against which vaccines may be less effective — is complicating the crisis. For the prospective traveler, it hints at the threat that emerging variants could play in the months and years to come.Inequality and lagging vaccine rolloutsOutside the United States, vaccination numbers remain comparatively low — in some cases, alarmingly so.In Italy, around 11 percent of the population is fully vaccinated. The number in Mexico, historically the country most visited by American tourists, stands at around 6 percent. In Canada, it’s at 3 percent — though that number is partly explained by the long interval between first and second doses there. By comparison, the United States just passed the 32 percent mark.While many of these percentages have been rising more quickly in recent weeks, there is also reason to believe that progress in some countries may stall.Global vaccine supplies have been disrupted by the surge of coronavirus cases in India, which has curtailed exports in order to meet growing domestic demands. Like most countries, Canada, for example, is entirely dependent on foreign sources for its vaccine supply; as a measure of the share of its population that is fully vaccinated, Canada now lags behind more than 50 other nations.Meanwhile, the push for a return to leisure travel raises questions about the ethics of vaccinated travelers demanding services among largely unvaccinated hosts. Such questions are especially complicated within communities that are economically dependent on tourism revenue.Dr. Mami Taniuchi, an infectious disease researcher at the University of Virginia, said that while the risk of breakthrough infections among vaccinated travelers is low, there is nevertheless an increased risk among unvaccinated workers who would not otherwise be coming together in such large numbers, or in such close quarters, to accommodate tourists.“The risks among vaccinated travelers are significantly reduced, but I worry about the risk of transmission among the people who are working around them,” Dr. Taniuchi said. It would help, she added, if travel workers were part of priority vaccination plans.“In a situation where there’s a mixing of people who are vaccinated and unvaccinated, most of the transmission events are going to be among those who are not vaccinated,” she said.The trouble with ‘vaccine passports’Health certificates that prove one’s immunization status — commonly referred to as “vaccine passports” — have been touted as keys to unlocking international travel. But so far the prospect of developing an easy-to-use and widely accepted digital certificate has been tripped up by a web of bureaucratic, logistical and technical snags.The Biden administration has ruled out the possibility of a centralized federal vaccination database. Instead, individual states (and some cities and territories) have been maintaining a patchwork of records. Any company or organization hoping to develop a digital vaccine certificate in the United States would therefore need to track down immunization data from a range of registries.At present, the most viable option for Americans to prove their immunization status while traveling internationally is to present the Covid-19 vaccination record cards they received when they got their shots. But the cards are easily forged. Several states have offered downloadable PDFs of the cards freely on their websites; fakes have even been offered for sale on TikTok, eBay and Craigslist.The development of digital health certificates is a multidimensional challenge, involving public policy, public health, customer experience and international cooperation, said Eric Piscini, who has overseen the development of IBM’s health passport app, Digital Health Pass.“I’m very optimistic about the long term,” Mr. Piscini said, “but the road is not easy.” He estimated that the European Commission’s Digital Green Certificate won’t be fully operational until late June or July. Integration with platforms beyond Europe will take time.Until then, he said, countries like Greece — which, for now, is verifying visitors’ immunization statuses with easily forged paper certificates — may face both a lack of trust from travelers and pushback from locals who fear that the policies are putting them at risk.Chairs were piled up in front of a restaurant that was closed because of lockdowns in Paris in March.Bertrand Guay/Agence France-Presse — Getty ImagesAltered destinationsEven if international tourists could travel safely and securely, and without risking the well-being of their hosts, visitors may face yet another impediment: Their destinations may lack many of their usual draws.Throughout the world, the pandemic has shuttered museums, forced restaurants to close and curtailed countless other cultural offerings. Many regions in Europe are subject to local curfews that come and go as case numbers fluctuate. Last month in Spain, confusion reigned over whether socially distanced beachgoers and sunbathers were required to wear masks, though the rule was eventually clarified. (They aren’t.)All of which suggests that, in the near future, there may be a gap between tourists’ expectations and their destinations’ restricted realities.In Paris, for example, bars and restaurants have been closed since the end of October. So, too, are museums — including the Louvre, normally one of the most visited museums in the world. Nighttime curfews, from 7 p.m. to 6 a.m., have emptied the city’s streets.In late April, President Emmanuel Macron of France announced plans to relax certain restrictions beginning on May 19, but he left open the possibility of regional delays. The country, he said, will be able to pull an “emergency brake” in certain places, if need be.“I really don’t know what’s going to be attractive to tourists in Paris, now or in the near future,” said Yumi Kayayan, a travel writer who lives near the Louvre, citing a dearth of cultural offerings. The rules governing curfews and regional restrictions, she added, would be difficult for foreigners to make sense of. “To be honest, the rules are very confusing right now even for Parisians,” she said.The big picture, and the costsIn 2019, the number of international tourist arrivals reached 1.5 billion globally — a staggering figure. But grasping the scale of international travel, and the industries that have grown to support and encourage it, is central to understanding the forces pressing now for its return.Governments, tourism boards, airlines, hotel companies, travel agencies and cruise operators, along with tour bus drivers, housekeepers, local guides, pilots, restaurateurs, museum operators, bed-and-breakfast hosts, entertainers, caterers, fishermen, shopkeepers and bar owners — in short, all the people standing to profit from tourism dollars — are facing extreme economic pressure not to lose out on another tourism season. The past year without travel, when international arrivals dropped from 1.5 billion to 381 million, was devastating. For many, another similar year would be unthinkable.And so an already stressed system has been forced to confront an existential quandary: Do countries opt for continuing international lockdowns, or do they increase the risk of disease and court much-needed tourism revenue? New Zealand, which, through a combination of stringent lockdowns, border closures and strict quarantines, has all but eliminated the coronavirus from its shores, has staked its claim at one end of the spectrum. Greece appears to be claiming the other.There are no easy answers, no universal solutions. In many cases, the onus will fall on individual tourists — the fortunate and vaccinated few, plied with incentives and feverish for travel — to thoughtfully navigate the ethical considerations.Of all the variables, only one thing seems inevitable: The choices we make, whether to venture out or huddle close to home, are unlikely to bode well for the individual workers — the unfortunate and unvaccinated many — who, by dint of circumstance, are vulnerable to both the virus and the teetering fortunes of a hard-hit industry.“I do think we’ve learned important lessons over the course of the year about how to engage more safely in public spaces,” said Dr. Fortune, who emphasized that it’s important for vaccinated travelers to continue testing, wearing masks and practicing social distancing.“I think the real danger,” she added, “is that the most vulnerable people are the ones who have the least ability to mitigate risk.”Follow New York Times Travel on Instagram, Twitter and Facebook. 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