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Top HeadlinesUS and World News

Australian election campaign kicks off with opposition ahead in polls

by Reuters April 11, 2022
By Reuters

By Renju Jose

SYDNEY -Australian Prime Minister Scott Morrison’s government could lose the federal election to be held on May 21, according to polls on Monday, even as they showed him consolidating his position as the country’s preferred leader on the first day of campaigning.

A Newspoll survey conducted for The Australian newspaper showed Morrison gaining a point to 44%, while opposition leader Anthony Albanese falling 3 points to 39%, the largest lead the prime minister has held over his rival since February.

But the poll said Morrison’s conservative Liberal-National Party coalition, with a one-seat majority in the lower house of parliament, could lose 10 seats to Albanese’s centre-left Labor in a campaign set to focus on cost-of-living pressures, climate change and questions over the major parties’ competence.

A separate survey for the Sydney Morning Herald newspaper on Monday predicted the ruling coalition could lose at least 14 seats, including some previously deemed safe in resource-rich Queensland and Western Australia states. A win for Labor would see it back in power for the first time since 2013.

All 151 seats in the lower house will be up for election. Morrison’s Liberal-National coalition holds 76, Labor 68 and seven are held by minor parties and independents.

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Morrison kicked off his election campaign from the marginal seat of Gilmore in New South Wales – a narrow Labor gain from the Liberal Party in the last election in 2019 – as he prepares to spend six weeks on the road before the vote.

“This election … is about a choice,” Morrison said during a media briefing on Monday, describing Albanese’s leadership as “untested and unknown”.

“It’s a choice between strong economic management and strong financial management … that contrasts to a Labor opposition who Australians know can’t be trusted to manage money.”

Albanese dismissed Morrison’s attacks on his experience as a leader saying he was “ready to govern”, but fumbled answers to questions from reporters about Australia’s interest rates and jobless numbers.

“The national unemployment rate at the moment is, I think it’s 5.4% … sorry, I’m not sure what it is,” Albanese said, speaking during a media conference in Tasmania.

Australia’s unemployment rate dipped to 4.0% in February, several months ahead of central bank forecasts as the economy rebounds, and looks certain to fall into the 3% range for the first time since the early 1970s.

Morrison has been touting his government’s handling of the economy after the emergence of the coronavirus and a faster rebound helped by the lifting of most COVID-19 restrictions despite the threat from the Omicron variant.

Recovery has also been boosted by surging prices for natural resource commodities, of which Australia is a major exporter.

(Reporting by Renju Jose; Editing by Sam Holmes and Kenneth Maxwell)

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Hungary says roubles-for-Russian gas plan breaches no EU sanctions

by Reuters April 11, 2022
By Reuters

BUDAPEST – Hungary plans to pay for Russian gas in euros through Gazprombank, which will convert the payment into roubles to meet a new requirement set by President Vladimir Putin, Foreign Minister Peter Szijjarto said on Monday.

Putin has warned Europe it risks having gas supplies cut unless it pays in roubles as he seeks retaliation over Western sanctions for Moscow’s invasion of Ukraine.

Under the scheme, Hungarian energy group MVM’s subsidiary, CEE Energy, would pay an upcoming bill in euros, which Gazprombank would convert into roubles and then transfer to Russia’s Gazprom Export, Szijjarto told a news conference.

With weeks go to before bills are due, the European Commission has said that those with contracts requiring payment in euros or dollars should stick to that.

Prime Minister Viktor Orban said last week Hungary was prepared to pay roubles for Russian gas, breaking ranks with the European Union which has sought a united front in opposing Moscow’s demand for payment in the currency.

“As for paying in roubles, we have a solution that does not violate any sanctions but at the same time it secures Hungary’s gas supply,” Szijjarto said.

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Szijjarto said the option to pay bills in another currency rather than euros was included in a bilateral contract between CEE Energy and Gazprom Export concluded in September, which will now be modified to reflect the planned changes.

He did not go into detail and it was unclear whether the falls in the Russian currency would affect the new payment terms in any way.

Szijjarto added that Hungary, which relies on Russia for most of its oil and gas, opposed the EU taking a joint approach to the issue, which Budapest considers a bilateral matter.

Orban, whose government has pursued close business relations with Moscow for over a decade, swept to power for a fourth consecutive term in elections a week ago, partly on a pledge to preserve security of gas supply for Hungarian households.

The European Union’s executive is drafting proposals for an EU oil embargo on Russia, the foreign ministers of Ireland, Lithuania and the Netherlands said on Monday, although there is still no agreement to ban Russian crude.

(Reporting by Gergely Szakacs and Anita Komuves; Editing by Nick Macfie)

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Mercedes-Benz to halve CO2 emissions by 2030

by Reuters April 11, 2022
By Reuters

BERLIN – Mercedes-Benz aims to halve its CO2 emissions by 2030, the carmaker said on Monday, providing a half-way goal to its existing target of becoming CO2 neutral by 2039.

The company will also work towards covering 70% of the energy it needs for production with renewable energy by 2030, up from 45-50% at present, it said.

Around 15% of this energy should come from solar and wind plants on or linked to Mercedes-Benz’ own sites, production chief Joerg Burzer said in a presentation.

The rest will be sourced through so-called Power Purchase Agreements (PPAs), where power producers are paid to generate a certain amount of energy over a number of years at a set price.

The carmaker is in advanced discussions to purchase additional wind energy through PPAs worth a billion euros ($1.09 billion) by 2025, Burzer added.

For now, Mercedes-Benz still relies on gas as a back-up supply source. “We obviously still need the gas,” Burzer said. “We are working on minimising that.”

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($1 = 0.9174 euros)

(Reporting by Victoria Waldersee; Editing by Paul Carrel)

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Lessor BOC Aviation to buy 80 Airbus aircraft in its largest order

by Reuters April 11, 2022
By Reuters

(Reuters) – BOC Aviation said on Monday it plans to buy 80 Airbus A320neo family jets in what is the aircraft-leasing firm’s largest order.

The order consists of 10 A321XLR aircraft, 50 A321neo aircraft and 20 A320neo aircraft, and the delivery of the jets is scheduled between 2027 and 2029.

“This is the largest single order that we have ever placed and it will bring our total Airbus aircraft purchased since inception to 546,” said Robert Martin, the chief executive of BOC Aviation.

The Singapore-based aircraft lessor had entered a deal in March to purchase 11 Boeing 737 Max 8 aircraft, which are scheduled to be delivered in 2023 and 2024.

(The story corrects headline to say BOC Aviation to buy 80 Airbus aircraft, not seeks.)

(Reporting by Riya Sharma in Bengaluru; Editing by Aditya Soni)

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Canada plans to double homebuilding in decade, but where are the workers?

by Reuters April 11, 2022
By Reuters

By Julie Gordon and Nichola Saminather

OTTAWA -Canada has an ambitious plan to double the pace of homebuilding within a decade but the first big challenge is finding enough skilled workers, as the country grapples with the tightest labor market on record and with construction already at a multi-year high.

Building more homes is a key peg of the C$9.5 billion ($7.5 billion) in housing spending outlined by Prime Minister Justin Trudeau’s Liberal government in their budget on Thursday.

The average selling price of a Canadian home has surged more than 50% in the last two years, driven by record low interest rates and tight supply. Construction has failed to keep pace with immigration-driven population growth.

But the plan to build hundreds of thousands of new homes runs counter the reality that home building is generally the purview of municipal and provincial governments, leaving the federal government little role beyond handing out money.

“It’s very ambitious. I would say it’s going to be equally challenging to pull it off, simply because the construction sector is already more or less operating at full capacity,” said Robert Kavcic, senior economist at BMO Economics.

“And we are already building a record number of homes in this country.”

Canada has the lowest number of housing units per 1,000 residents of any Group of Seven nation, and that has been on the decline due to population growth, Bank of Nova Scotia economists said https://www.scotiabank.com/ca/en/about/economics/economics-publications/post.other-publications.housing.housing-note.housing-note–may-12-2021-.html in a report last year.

There are nearly 300,000 units under construction across Canada, compared with about 240,000 just two years ago, government data https://www.cmhc-schl.gc.ca/en/professionals/housing-markets-data-and-research/housing-data/data-tables/housing-market-data/housing-starts-completions-units-under-construction shows.

Canada is building “a lot and not enough,” said William Strange, professor of economic analysis and policy at the University of Toronto. “We’ve taken decades getting into this situation and we’re not going to get out of it in six months.”

Canada has added more than 100,000 construction jobs in the last four months alone, a historic run of increases for the sector. Overall jobless rate fell to a record 5.3% in March.

“Just the sheer volume of work that exists within the industry (creates) a lot of pressure on the various trades,” said Jim Ritchie, chief operating officer of Tridel, which develops condominiums in the Toronto area.

“So there’s a lot of demand for that workforce.”

Canada’s immigration program could be a double-edged sword, as it brings in more skilled workers to replace a fast-retiring workforce, but also fuels housing demand. There is also a mismatch between the workers Canada is currently targeting and those it needs.

“Right now, our immigration policies are more geared towards attracting white collar labor than blue collar labor,” said Mike Moffatt, senior director of policy and innovation at the Smart Prosperity Institute.

Construction costs rose nearly 10% in 2021 and are set to climb again, driven by higher labor and materials costs, adding to the near-term challenges, said Ritchie of Tridel.

Municipal and provincial approval delays, which the federal government hopes to address with a C$4 billion “Housing Accelerator Fund,” and the availability of land add to the hurdles.

“There a whole bunch of levers that need to be pulled and increasing labor supply… is one of them,” said Justin Sherwood, a spokesperson for the Building Industry and Land Development Association in the Toronto area.

Still, Canada’s Finance Minister Chrystia Freeland was undeterred.

“We are going to do everything we say we’re going to do,” she told reporters on Thursday when asked about the challenge of meeting the plan.

“A growing population needs a growing housing supply.”

($1 = 1.2588 Canadian dollars)

(Reporting by Julie Gordon in Ottawa and Nichola Saminathar in TorontoEditing by Nick Zieminski)

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Ericsson suspends business in Russia, puts staff on paid leave

by Reuters April 11, 2022
By Reuters

By Supantha Mukherjee and Anna Ringstrom

STOCKHOLM – Ericsson is suspending its business in Russia indefinitely and has put employees on paid leave, six weeks after the Swedish telecom equipment maker started a review of the impact of Western sanctions on its operations.

The company said on Monday it would record a 900 million crown ($95 million) provision in the first quarter for impairment of assets and other exceptional costs related to the move.

Ericsson has about 600 employees in Russia, a spokesperson said.

Hundreds of Western companies have either withdrawn https://som.yale.edu/story/2022/over-600-companies-have-withdrawn-russia-some-remain or suspended operations in Russia since the country invaded Ukraine in February while Western governments have imposed sanctions.

Russian President Vladimir Putin sent his troops into Ukraine on what he calls a “special military operation” to demilitarise and “denazify” Ukraine. Ukraine and the West say Putin launched an unprovoked war of aggression.

Ericsson had paused deliveries to customers in Russia in February, and rival Nokia did so in early March.

“Move was inevitable following a swathe of sanctions,” said Paolo Pescatore, an analyst at PP Foresight. “It will be a huge blow to both Ericsson and Nokia as they will not be paid for their networks.”

The suspension will also hurt Ericsson’s future plans in the country as Russia said last year it would extend telecoms operators’ licences beyond 2023 for networks on the condition that they started building networks using only Russian equipment.

Ericsson does not have any manufacturing in Russia and its manufacturing hubs in Europe are in Estonia and Poland.

Nokia in November announced plans to set up a joint venture with YADRO, a leading Russian developer and producer of high-performance servers and storage systems, to build 4G and 5G telecom base stations in Russia.

Nokia said in a statement the company complies with all sanctions and restrictions and has suspended deliveries to Russia for the time being.

“Nokia will not continue R&D in Russia and we have already started the process of transferring R&D tasks outside of Russia,” the company said.

($1 = 9.4568 Swedish crowns)

(This version of the story corrects name of analyst’s company in paragraph seven to PP Foresight, not PP Insights)

(Reporting by Anna Ringstrom and Supantha Mukherjee; Editing by Simon Johnson and David Goodman)

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Ukraine conflict hurts Russian science, as West pulls funding

by Reuters April 11, 2022
By Reuters

By Gloria Dickie and Dasha Afanasieva

LONDON – Dozens of international scientists have arrived each year since 2000 at Russia’s remote Northeast Science Station on the Kolyma River in Siberia to study climate change in the Arctic environment.

Not this year, though.

Following Russia’s invasion of Ukraine, Germany’s Max Planck Institute for Biogeochemistry froze the funding used to pay personnel at the research station and to maintain instruments that measure how quickly climate change is thawing Arctic permafrost and how much methane – a potent planet-warming gas – is being released.

The funding freeze will probably lead to an interruption of the continuous measurements at the station dating back to 2013, compromising scientists’ understanding of the warming trend, said Peter Hergersberg, a spokesperson for the Max Planck Society, which is funded by the German state.

“(Russian) colleagues at the Northeast Science Station try to keep the station running,” Hergersberg said. He declined to say how much funding was withheld.

Reuters spoke with more than two dozen scientists about the impact of the Ukraine conflict on Russian science. Many expressed concern about its future after tens of millions of dollars in Western funding for Russian science has been suspended in the wake of European sanctions on Moscow.

Hundreds of partnerships between Russian and Western institutions have been paused if not canceled altogether, the scientists said, as the invasion has unraveled years spent building international cooperation following the Soviet Union’s 1991 collapse.

Many communication channels are closed and research trips have been postponed indefinitely.

The projects affected by the suspension of Western assistance include the construction of high-tech research facilities in Russia, such as an ion collider and a neutron reactor for which Europe had pledged 25 million euros ($27.4 million).

Such technology would unlock a generation of research that could contribute to everything from fundamental physics to the development of new materials, fuels and pharmaceuticals, scientists said.

Another 15 million-euro ($16.7 million) contribution toward designing low-carbon materials and battery technologies needed in the energy transition to combat climate change has also been frozen, after the European Union halted all cooperation with Russian entities last month.

“Emotionally, I can understand this suspension,” said Dmitry Shchepashchenko, a Russian environmental scientist who studies global forest cover and has been affiliated with the International Institute for Applied Systems Analysis in Austria since 2007.

But for science overall, he said: “This is a lose-lose solution. Global issues like climate change and biodiversity … can hardly be solved without Russian territory [and] the expertise of Russian scientists.”

FROZEN FINANCES

When the Soviet Union broke apart, Russian spending on science plummeted, and thousands of scientists moved abroad or abandoned their fields altogether.

“We felt as scientists that our work was not appreciated,” said permafrost scientist Vladimir Romanovksy, who moved his work to Fairbanks, Alaska, in the 1990s. “There was practically no funding, especially for field work.”

Russian funding has since improved, but remains far below that of the West. In 2019, Russia spent 1% of its GDP on research and development — or about $39 billion, adjusted for currency and price variation — according to the Organisation for Economic Co-operation and Development (OECD).

Most of that money has been spent in physical science fields, such as space technology and nuclear energy.

By comparison, Germany, Japan and the United States each spend around 3% of their respective GDPs. For the United States, that amounted to $612 billion in 2019.

Russian science got a boost, though, from partnerships on projects with scientists abroad. Russia and the United States, for example, led the international consortium that launched the International Space Station in 1998.

The head of Russia’s space agency, Roscosmos, said this month it would suspend its participation in the space station until sanctions tied to the Ukraine invasion are lifted.

Russian scientists also helped build the Large Hadron Collider, the world’s most powerful particle accelerator, at the European Organization for Nuclear Research in Switzerland, known as CERN. In 2012, the collider made the breakthrough discovery of the elusive Higgs boson, which until then had only been theorized.

Scientific camaraderie with Europe continued uninterrupted after Russia annexed Crimea from Ukraine in 2014. But CERN’s governing council announced last month it was suspending any new collaboration with Russia.

Germany alone has given some 110 million euros ($122 million) toward more than 300 German-Russian projects over the last three years. A further 12.6 million euros ($14 million) in EU funding was awarded to Russian organisations for another 18 projects focusing on everything from Arctic climate monitoring to infectious animal diseases.

Chemist Pavel Troshin recently won Russian state funding for his part in a Russian-German effort to develop next-generation solar cells to power communication satellites. But, with the German side now suspended, the project is up in the air.

Joint projects “are supposed to be done for the benefit of all the world, and cutting out Russian scientists … is really counter-productive,” said Troshin, who works at Russia’s Institute for Problems of Chemical Physics.

“I would never expect something like this. It’s shocking to me. I’m upset very much.”

ARCTIC BLACKOUT

Among the more urgent research efforts on hold are projects to study climate change in the Russian Arctic.

“Two-thirds of the permafrost region is in Russia, so data from there is critical,” said Northern Arizona University ecologist Ted Schuur of the Permafrost Carbon Network.

“If you cut off your view of changing permafrost in Russia, you’re really cutting off our understanding of global changes to permafrost.”

That’s alarming for scientists as global warming thaws the long-frozen ground that holds an estimated 1.5 trillion metric tons of organic carbon – twice the amount already in the atmosphere today.

As permafrost thaws, organic material locked within the ice decays and releases more planet-warming gases like methane and carbon dioxide. Scientists fear that such emissions could cause climate change to spiral out of control.

Scientists can use satellites to monitor landscape changes due to thaw, but can’t pick up what’s happening below ground, which requires on-site research, Schuur said.

Russian scientists have collected and shared permafrost field data for years, but Western researchers aren’t sure if those communication channels will remain open. Those datasets were also patchy, due to limited funding to cover the vast region.

Arctic ecologist Sue Natali, at U.S. Woodwell Climate Research Center, said her project’s plans for boosting Russian monitoring capability is on hold.

“Instrumentation that was supposed to go out this year has been halted,” she said, as her colleagues’ travel plans have been canceled.

The U.S. government has issued no clear directive on interacting with Russian institutions, contrary to the European stance.

A State Department spokesperson told Reuters: “We do not hold the people of Russia responsible [for the conflict], and believe that continued direct engagement with the Russian people is essential – including in science and technology fields.”

SCIENCE AS COLLATERAL DAMAGE

Projects under the Russian Science Foundation’s state-funded 2021 budget of 22.9 billion rubles ($213 million) had relied on partnerships with India, China, Japan, France, Austria, and Germany, among others.

A spokesperson did not answer Reuters questions about how the halt in European collaboration would affect its work, saying only that the foundation would “continue to support leading teams of researchers and their research projects.”

European scientists had been helping to build Russian research sites including the neutron reactor and the ion collider near St. Petersburg, said Martin Sandhop, a coordinator on this EU-funded effort called CremlinPlus.

The facilities would help to drive research in fields like high-energy physics, biochemistry and materials science.

But plans for a 25-million-euro project extension are now suspended and Sandhop’s team is redirecting experts and equipment toward European institutions.

Cremlin’s neutron detectors needed for the planned reactor, for example, are now going to a facility in Lund, Sweden.

Even if Russia manages to complete the expansion works, it’s unclear how valuable the work will be without the suite of tools at Western institutions to analyse the data.

Physicist Efim Khazanov at the Institute of Applied Physics in Nizhny Novgorod, near Moscow, said not having access to European equipment would hurt his work using a high-energy laser to study topics such as the structure of spacetime in a vacuum, which could expand our understanding of the universe.

Khazanov was among thousands of Russian scientists who signed an open letter, posted on the independent online science publication Troitskiy Variant, saying Russia had “doomed itself to international isolation” with its invasion of Ukraine.

Many Russian scientists also fled the country https://nam02.safelinks.protection.outlook.com/?url=https%3A%2F%2Facademia.interfax.ru%2Fru%2Fnews%2Farticles%2F8241%2F&data=04%7C01%7CKaty.Daigle%40thomsonreuters.com%7C3496e75332214187562d08da166a1deb%7C62ccb8646a1a4b5d8e1c397dec1a8258%7C0%7C0%7C637846942271472634%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000&sdata=%2FPsx1Vt6cZZmma1wkypEgajrN3PTax5p%2FZtecupKyo8%3D&reserved=0, said Alexander Sergeev, head of the Russian Academy of Sciences, according to Interfax state news agency.

The protest letter https://t-invariant.org/2022/02/we-are-against-war was temporarily removed from the site after Russia passed a law March 4 criminalizing “fake news” on the Ukraine campaign.

That day, a letter was published on the state Russian Rectors’ Union website in support https://www.rsr-online.ru/news/2022-god/obrashchenie-rossiyskogo-soyuza-rektorov1 of Russia’s invasion and signed by more than 300 leading scientists, who have since been suspended from European University Association membership.

While foreign funding represents just a small part of Russia’s scientific spending, its scientists relied on that money to keep projects and careers afloat.

“Those joint research grants were helping a lot of Russians,” lamented Russian geographer Dmitry Streletskiy, at George Washington University in Washington, D.C. “I’m just surprised the EU is targeting scientists, which is not the right crowd to target.”

(Reporting by Gloria Dickie and Dasha Afanasieva; Editing by Katy Daigle and Daniel Flynn)

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Pfizer taps David Denton from Lowe’s as CFO

by Reuters April 11, 2022
By Reuters

(Reuters) – Pfizer Inc said on Monday that Lowe’s Cos Inc Chief Financial Officer David Denton would succeed company veteran Frank D’Amelio as the U.S. drugmaker’s finance chief.

Denton, who has also held leadership positions at CVS Health, will join Pfizer on May 2, the company said.

He will also be a member of Pfizer’s Executive Leadership Team and report to Chief Executive Officer Albert Bourla.

Pfizer announced the retirement of D’Amelio in November and started an external search for his replacement. (https://reut.rs/38LtezX)

Home improvement chain Lowe’s said on Friday that Denton would step down to pursue another opportunity at a publicly traded company outside the industry.

(Reporting by Mrinalika Roy in Bengaluru; Editing by Shounak Dasgupta and Sriraj Kalluvila)

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Exclusive-Apple faces extra EU antitrust charge in music streaming probe -source

by Reuters April 11, 2022
By Reuters

By Foo Yun Chee

BRUSSELS – Apple faces an additional EU antitrust charge in the coming weeks in an investigation triggered by a complaint from Spotify, a person familiar with the matter said, a sign that EU enforcers are strengthening their case against the U.S. company.

The European Commission last year accused the iPhone maker of distorting competition in the music streaming market via restrictive rules for its App Store that force developers to use its own in-app payment system and prevent them from informing users of other purchasing options.

Such requirements have also come under scrutiny in countries including the United States and Britain.

Extra charges set out in a so-called supplementary statement of objections are usually issued to companies when the EU competition enforcer has gathered new evidence or has modified some elements to boost its case.

The Commission declined to comment. Apple had no immediate comment.

Under new EU tech rules called the Digital Markets Act (DMA) agreed last month, such practices are illegal. However Apple and other U.S. tech giants targeted by the rules will have a couple of years before the crackdown starts.

“The DMA is still two years away. The rules will probably apply to Apple at the beginning of 2024. This is why antitrust cases remain important,” said lawyer Damien Geradin at Geradin Partners, who is advising several app developers in other cases against Apple.

Companies found breaching EU antitrust rules face fines of as much as 10% of their global turnover and orders to ditch anti-competitive practices.

In addition to the music streaming investigation, Apple’s practices in e-books and its Apple Pay are also in the EU antitrust crosshairs.

Sweden’s Spotify, the largest music subscription service in the world, is one of Europe’s big global success stories in consumer technology.

(Reporting by Foo Yun Chee; editing by Jan Strupczewski, Kirsten Donovan and Susan Fenton)

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China will step up implementation of macro policies – state media

by Reuters April 11, 2022
By Reuters

BEIJING – China will step up the implementation of macro policies as the downward pressure on the economy is increasing, state media on Monday quoted Premier Li Keqiang as saying.

Authorities should be highly vigilant of changes in the domestic and international environment that have exceeded expectations, Li was quoted as saying.

(Reporting by Kevin Yao and Beijing newsroom; Editing by Toby Chopra)

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Rosatom subsidiary will proceed with Finnish nuclear project

by Reuters April 11, 2022
By Reuters

By Anne Kauranen

HELSINKI – Russia’s state-owned nuclear power supplier Rosatom and its Finnish unit RAOS Project will proceed with a planned nuclear plant in Finland, RAOS said on Monday, despite uncertainty over government permits since Russia’s invasion of Ukraine.

“Rosatom and RAOS Project continue fulfilling their obligations under signed agreements and contracts relating to the Hanhikivi 1 project,” RAOS Project told Reuters in an email.

Since Russia began what it calls a “special operation” in Ukraine, Finland’s minister of economic affairs Mika Lintila has repeatedly said it would be “absolutely impossible” for the government to grant a construction permit for the Hanhikivi plant.

The plant was commissioned by a Finnish-Russian consortium dubbed Fennovoima, in which Finnish stakeholders such as Outokumpu, Fortum and SSAB own two thirds and Rosatom’s subsidiary RAOS Voima holds the rest.

Many of the Finnish stakeholders have publicly expressed their will to pull out and write down the project, but are unwilling to pay RAOS Project for breach of existing contracts and possible indemnities.

Meanwhile, RAOS Project has continued preparatory construction work, such as cabling and excavation in the planned plant’s site on the northwest coast of Finland, but cannot embark on building the facility without a government licence.

“RAOS Project Ltd as the … supplier is acting based on and in accordance with the engineering, procurement and construction contract signed in December 2013 with Fennovoima,” it wrote.

Fennovoima had expected to obtain a construction licence from the government by summer 2022 to build the 1.2 gigawatt (GW) reactor, while construction was expected to begin in 2023.

Finland’s government was not immediately available for comment.

(Reporting by Anne Kauranen; Editing by David Goodman and David Holmes)

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EU adds 21 Russian airlines to those banned in EU

by Reuters April 11, 2022
By Reuters

BRUSSELS – The European Commission has added 21 Russian airlines to a list of carriers banned from operating in the 27-nation bloc because they do not meet international safety standards, the EU executive arm said on Monday.

“The Russian Federal Air Transport Agency has allowed Russian airlines to operate hundreds of foreign-owned aircraft without a valid certificate of airworthiness,” Commissioner for Transport Adina Valean said.

“The Russian airlines concerned have knowingly done so in breach of relevant international safety standards. This …poses an immediate safety threat,” she said.

She said the decision to ban the airlines certified in Russia, which include Aeroflot, was not another sanction against Moscow for its invasion of Ukraine, but a measure taken only on the basis of technical and safety grounds.

The Commission said that after the addition of the 21 Russian airlines, the EU black list of carriers banned from EU skies now contained 117 companies.

(Reporting by Jan Strupczewski, editing by Ed Osmond)

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Portugal’s TAP posts 1.6 billion euro loss, sees ‘cautious optimism’ for 2022

by Reuters April 11, 2022
By Reuters

By Patricia Vicente  Rua and Catarina Demony

LISBON -Ailing Portuguese airline TAP posted an annual loss of 1.6 billion euros ($1.74 billion) on Monday, while voicing “cautious optimism” that 2022 would bring better results despite uncertainties caused by the Ukraine war and the pandemic.

The airline, which is 72.5% controlled by the Portuguese state, is under a Brussels-approved rescue plan worth 3.2 billion euros and was forced to reduce its fleet size, cut more than 2,900 jobs and reduce wages.

TAP said its 2021 results were hurt by the closure of its aircraft maintenance business in Brazil and the depreciation of the euro against the dollar.

The company, along with the rest of the industry, was still facing “unprecedented levels of uncertainty” due to various factors, from COVID-19 to Russia’s invasion of Ukraine, Chief Executive Officer Christine Ourmieres-Widener told a news conference.

Rising inflation may create further challenges, mostly due to the cost of materials and fuel, she said.

Chief Financial Officer Goncalo Pires said the airline would need to “continue to perform in line” with its restructuring plan in order to present better results in the future.

“Delivering the plan is about maximising revenue but also controlling costs,” Pires told reporters. “There are many external factors, so we need to find strategies to mitigate those.”

Under the restructuring plan, TAP also had to wind down and close its aircraft maintenance business in Brazil, which represented a non-recurring loss of 1.03 billion euros.

In 2020, the airline posted a 1.2 billion euros loss due to the pandemic. Ourmieres-Widener said TAP was not likely to reach pre-pandemic levels before next year.

The company transported 5.83 million passengers last year, up 25% on 2020, but only 34% of the pre-pandemic level in 2019.

($1 = 0.9170 euros)

(Reporting by Patrícia Vicente Rua and Catarina Demony; Editing by Inti Landauro, Ed Osmond and Mike Harrison)

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Nepal restricts imports to save cash, suspends cenbank governor

by Reuters April 11, 2022
By Reuters

By Gopal Sharma

KATHMANDU -Nepal is tightening imports of cars, gold and cosmetics as its foreign exchange reserves have fallen, a central bank official said on Monday, after the government suspended the central bank governor and named his deputy the interim chief.

The Himalayan country’s foreign reserves have been hit by a slump in tourism in Asia during the pandemic, a problem that has also hit Sri Lanka which is going through a crippling economic crisis due to a shortage of tourist revenue and other funds.

“Nepal Rastra Bank (NRB, the central bank) feels the country’s foreign exchange reserves are under pressure and something must be done to restrict the import of non-essential goods, without affecting the supply of essential goods,” NRB deputy spokesperson Narayan Prasad Pokharel told Reuters.

He said importers would be issued letters of credit to bring in 50 “luxurious goods” only with full upfront payments with the bank, declining to name all the items.

“We have already directed all the border customs points about the new arrangements for the import of these goods,” he said. “This is not banning the imports but discouraging them.”

A spokesperson for the central bank referred questions about the governor’s suspension to the finance ministry.

A ministry spokesperson said he did not know why NRB Governor Maha Prasad Adhikari was suspended on Friday but that a government panel would investigate the matter.

A government official said on condition of anonymity that Adhikari was accused of leaking sensitive financial information to the media. Reuters could not immediately contact Adhikari, whose mobile phone was switched off.

With tourism struggling to resume after two years of the COVID-19 pandemic, Nepal’s gross foreign exchange reserves fell to $9.75 billion as of mid-February, down 17% from mid-July last year when its financial year started.

The current reserves are sufficient to support imports for about six months for the country of some 29 million people, where India and China jostle for influence.

Data from the central bank shows remittances from overseas fell 5.8% to $4.53 billion between mid-July to mid-February.

The balance of payments had a deficit of $2.07 billion in the first seven months of the current financial year, compared with a surplus of $817.6 million in the same period the previous year.

Opposition parties have criticised Prime Minister Sher Bahadur Deuba’s government for suspending the central bank governor when the economy is weak.

“He was doing a good job and his removal at a time when economic indicators are not good is a wrong decision,” said Surendra Pandey, a senior leader and lawmaker of the opposition Communist Unified Marxist-Leninist party.

The Asian Development Bank said this month that Nepal’s government debt increased to 41.4% of gross domestic product in the 2021 fiscal year, from an average of 25.1% between 2016 and 2019 due to increased spending during the pandemic.

The Philippines-based bank predicted Nepal’s current account deficit would widen to 9.7% of GDP in this fiscal year from 8% last year.

(Reporting by Gopal Sharma; Additional reporting by Manoj Kumar; Editing by Krishna N. Das, Alison Williams and Susan Fenton)

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Google sues alleged puppy scammer after tip from AARP

by Reuters April 11, 2022
By Reuters

By Paresh Dave

OAKLAND, Calif. – Alphabet Inc’s Google on Monday sued an alleged puppy scammer who used its services to sell fake pets, the first of what the company said would be a growing number of lawsuits targeting apparent misuse by its users.

Elder advocacy group AARP tipped Google to the scam last September following a complaint from a South Carolina resident who had sent $700 in digital gift cards to an online seller for a basset hound puppy that never came, according to Google’s lawsuit in U.S. district court in San Jose.

Google is seeking monetary damages and a court order banning the accused user, Nche Noel of Cameroon. Noel did not respond to a request for comment through one of several puppy websites named in the lawsuit, and an attorney was not immediately listed for Noel in court records.

Noel used dozens of Gmail email and Google Voice accounts “to communicate false promises to victims, register the fraudulent websites with U.S. internet hosting companies, and request and receive payments,” the lawsuit states.

In addition to basset hounds, websites allegedly linked to Noel have offered maltipoo puppies and marijuana and prescription opiate cough syrup, according to the lawsuit.

Google policies bar use of its services in illegal activities. The lawsuit says the puppy scam harmed Google’s reputation and cost it over $75,000 to investigate and remediate.

The company said that while it was unlikely that Noel would appear in court, an order against Noel could disrupt the alleged scam and deter copycats.

Previously, Google referred a similar case to the U.S. Justice Department. That Cameroonian puppy scammer pleaded guilty last year https://www.justice.gov/opa/pr/cameroonian-citizen-extradited-romania-pleads-guilty-conspiracy-defraud-online-purchasers.

Google has previously sued hackers based in Russia and marketing companies masquerading under its name. But the company said it was the first time it directly filed a consumer protection case before.

Google timed its filing to coincide with National Pet Day.

(Reporting by Paresh Dave; Editing by Sandra Maler)

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Analysis-Politics, not substance, seen guiding U.S. and Iran on terror listing

by Reuters April 11, 2022
By Reuters

By Arshad Mohammed and Parisa Hafezi

(Reuters) – One of the last obstacles to reviving the 2015 Iran nuclear deal – Tehran’s demand to remove its Revolutionary Guards from a U.S. terrorism list – is more an issue of politics than substance, analysts said.

While the two sides had appeared close to reviving the pact a month ago, talks have since stalled over last-minute Russian demands, the Nowruz holiday, and the unresolved issue of whether Washington might remove the Islamic Revolutionary Guard Corps (IRGC) from the U.S. Foreign Terrorist Organization (FTO) list.

The United States and Iran have been engaged it fitful, indirect talks for more than a year on reviving the 2015 deal under which Iran limited its nuclear program in return for relief from economic sanctions.

The United States has weighed dropping the designation in return for some kind of action or commitment from Iran to rein in IRGC activities, one source has said.

However, the White House is well aware of “the political sensitivity and price associated with” removing the elite force from the list, said Dennis Ross, a long-time U.S. Middle East negotiator, noting that some Democrats oppose dropping it.

“There is hesitancy on the part of the political side of the White House,” he added.

A senior administration official said U.S. President Joe Biden did not intend to drop the terrorism designation, Washington Post columnist David Ignatius reported on Friday.

Asked about that report, a senior Biden administration official said, “We are not going to negotiate in public. There are still gaps.”

“The onus here is really on Iran at this stage, particularly on this issue,” the official added on condition of anonymity.

LITTLE ECONOMIC IMPACT

When the Trump administration designated the IRGC as an FTO in 2019, it was the first time Washington had so blacklisted part of another country’s military and was seen by some as a poison pill to make it harder to revive the nuclear deal, which then-President Donald Trump abandoned in 2018.

Critics of dropping the IRGC from the list, as well as those open to the idea, say doing so will have little economic effect because other U.S. sanctions force foreign actors to shun the group.

“It’s the administration-wide assessment that it would not have a significant – if any – impact,” said a senior U.S. official on condition of anonymity.

This is in part because the IRGC would remain sanctioned as a “specially designated global terrorist” (SDGT) on a separate U.S. blacklist list created after the Sept. 11, 2001, attacks.

The IRGC, a powerful political faction in Iran, controls a business empire as well as elite armed and intelligence forces that Washington accuses of a global terrorist campaign.

Iranian sources cited multiple reasons why they want the designation removed, including domestic politics and the desire of new Iranian President Ebrahim Raisi’s team to show it can secure a better deal than his predecessor Hassan Rouhani.

“Mostly it is a matter of dignity for the establishment and Iran’s negotiators,” said a senior Iranian diplomat on condition of anonymity.

“The new team from the beginning insisted on the FTO issue and sees it as a major achievement if those sanctions are lifted. That is mainly for domestic use because they criticized Rouhani’s 2015 deal and cannot just revive it,” added a former senior Iranian official briefed on the talks.

Another Iranian diplomat said Iran had rejected the idea of removing the designation from the IRGC as a whole but keeping it on the group’s elite Quds Force.

SOFT ON TERRORISM?

While U.S. officials are loathe to admit it, the main issue in Washington is also political. Republicans argue dropping the FTO label would show the Biden administration is soft on terrorism, a charge U.S. officials deny.

Representative Michael McCaul, the top Republican on the House Foreign Affairs Committee, last week called the IRGC “a killing machine” that threatens Americans and he stressed the political cost to the White House.

“That’s going to split the Democratic party in half on this, if not more,” he said.

Some Democrats have voiced misgivings, although there is little chance Congress could block a revived nuclear deal.

“We can’t gamble with American lives and remove the … FTO designation,” U.S. Representative Josh Gottheimer, a New Jersey Democrat, said last week.

Even critics admit removal would have few practical effects.

Matthew Levitt of the Washington Institute for Near East Policy think tank said labeling the IRGC as an FTO added only two authorities: allowing the U.S. government to bar entry by anyone associated with it and to impose criminal penalties to those who knowingly provided it “material support.”

In a recent analysis, Levitt said Iran would use a removal to argue that it does not engage in terrorism, and that dropping the label would undermine the credibility of U.S. sanctions.

“The IRGC should not be removed from the FTO list until there is evidence it has ceased terrorist activities,” he wrote.

(Reporting By Arshad Mohammed in Saint Paul, Minn., and Parisa Hafezi in Dubai; Additional reporting by Patricia Zengerle and Nandita Bose in Washington; Editing by Mary Milliken and Daniel Wallis)

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N.Korea celebrates 10 years of Kim Jong Un as top party leader

by Reuters April 11, 2022
By Reuters

By Josh Smith

SEOUL – North Korea praised Kim Jong Un’s leadership in developing nuclear weapons, touted his political achievements, and unveiled new portraits and exhibitions to celebrate his 10 years in charge of the ruling Workers’ Party of Korea (WPK).

Kim is considered to have assumed power when he was named supreme commander of the military after his father, Kim Jong Il, died in Dec. 2011.

Monday marks ten years since the younger Kim was elected as the top party and state leader. The Kim family has ruled the one-party state for its entire history.

In a speech at a national meeting on Sunday, Choe Ryong Hae, member of the Presidium of the Political Bureau of the WPK Central Committee and one of the most senior officials under Kim, praised the North Korean leader as “a gifted thinker and theoretician, outstanding statesman and peerlessly great commander.”

The events started a week of commemorations that will also include the 110-year anniversary of the birth of Kim Il Sung, North Korea’s founder and Kim Jong Un’s grandfather, on Friday.

Commercial satellite imagery has shown North Korean troops practicing for a military parade that could be held this week. Analysts also say there are signs that North Korea could display its ICBMs at the event.

Last month North Korea set alarm bells ringing in Seoul, Tokyo and Washington by conducting a full ICBM test for the first time since 2017, ending a self-imposed moratorium on such tests

New construction has been spotted at North Korea’s nuclear test site, raising concerns that it could soon explode a weapon for the first time since 2017. Last week North Korea said it opposes war but will not hesitate to use its nuclear weapons if it is attacked by South Korea.

Choe called Kim “a peerless patriot and a great defender of peace” for making North Korea “a full-fledged military power equipped with all powerful physical means of self-defence.”

Under Kim North Korea conducted four of its six nuclear tests, and developed massive intercontinental ballistic missiles (ICBMs) that analysts believe may be capable of striking anywhere in the United States.

Despite facing unprecedented difficulties, Kim had opened up a new era for North Korea as a powerful socialist nation prospering and developing with self-sustenance and self-reliance, Choe said.

Kim has vowed to improve residents’ lives and tried to boost North Korea’s economy, but it suffered major contractions in recent years as it was battered by international sanctions, COVID-19 lockdown measures and bad weather. U.N. agencies have warned of possible humanitarian crises.

State media unveiled a rare new official portrait of Kim on Sunday, and reported that a Pyongyang museum had opened a new exhibition to showcase the achievements of his “immortal leadership”.

“Ten years is a fine time for Kim to try and boost his cult of personality even higher,” Colin Zwirko, an analytical correspondent with NK News, which monitors North Korea, said on Twitter.

(Reporting by Josh Smith; Editing by Simon Cameron-Moore)

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U.S. money market funds say SEC draft rule would kill some products

by Reuters April 11, 2022
By Reuters

WASHINGTON – U.S. asset managers are pushing back on draft rules aimed at fixing systemic risks in the $5 trillion money market funds industry, arguing that one of the proposed measures would kill off popular products, executives told Reuters.

After taxpayers bailed out money market funds, a key source of short-term corporate and municipal funding, for the second time in 12 years during the pandemic-induced turmoil of 2020, the industry is facing renewed regulatory scrutiny.

Money market funds invest in high-quality short-term debt instruments and offer daily redemptions. Investors expect immediate liquidity with little price volatility and are spooked when those expectations are not met during market stress.

As the pandemic shut down the economy in March 2020, investors pulled more than $130 billion from some money market funds, contributing to stress in the short-term funding markets, according to a Treasury analysis that is disputed by the funds industry.

In December, the Securities and Exchange Commission (SEC) proposed boosting money market funds’ resilience by, among other measures, adjusting a funds’ value in line with trading activity so that redeeming investors bear the costs of exiting a fund and don’t dilute remaining investors. In theory, this “swing pricing” reduces the incentive to run to the exit first.

The deadline to submit comments is Monday and the industry is pushing back hard on the swing pricing measures, arguing they would be operationally challenging, impose excessive costs on fund sponsors, and reduce daily liquidity for investors.

“We really do believe that it would kill the product,” said Jane Heinrichs, associate general counsel at the Investment Company Institute, which represents the asset managers. “Funds would determine it’s not worth the changes necessary to make it work for a product that will no longer meet the needs of investors.”

The SEC has provided no data to support the idea, Heinrichs said.

While swing pricing is used by some European funds, it is an unfamiliar concept to U.S. investors, said Peter Yi, a director at Northern Trust Asset Management. “Without a doubt, swing pricing is going to be very difficult for investors to understand.”

An SEC spokesperson did not immediately provide comment.

To calm fleeing investors and stem a broader crisis, the Treasury and Federal Reserve in March 2020 launched emergency liquidity facilities to backstop the market. The panic was reminiscent of 2008, when a run on money market funds likewise prompted the U.S. government to prop up the market.

That bailout led the SEC in 2010 and 2014 to introduce rules aimed at reducing the risk of investor runs. But 2020 showed those changes were inadequate, said regulatory experts.

Advocacy groups say money market funds are operating with an implicit government guarantee, without the stringent capital and liquidity requirements such guarantees usually require.

“The government is literally giving private business – the money market fund sponsors – billions and billions a year for nothing,” said Dennis Kelleher, president of the Washington-based advocacy group Better Markets. “And then when there’s market stress, they don’t have to cover the downside.”

His group is calling for wholesale reforms that go further than the SEC’s proposal, including bank-like capital buffers.

While the Investment Company Institute opposes swing pricing, it supports in principle the SEC’s proposal to raise funds’ liquidity requirements, and to allow fund boards more flexibility to charge for or suspend redemptions during stress, known a fund “gate.”

In 2020, investor runs accelerated as funds approached a minimum liquidity threshold that, under the current rules, allows fund boards to gate redemptions. The SEC rule would eliminate that bright line.

“By de-linking the fees and gates from the liquidity thresholds and increasing the liquidity levels, you directly address the issues from 2020,” Heinrichs said.

(Reporting by Michelle Price; Editing by Leslie Adler)

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Stung by redistricting rulings, Republicans target state court elections

by Reuters April 11, 2022
By Reuters

By Joseph Ax and Jarrett Renshaw

(Reuters) – Republicans are vowing to spend record amounts in key state supreme court races this fall, seeking to take advantage of a favorable national political environment to elect conservative judges at the state level amid deep political divisions.

A string of decisions throwing out Republican-drawn congressional maps in Ohio, North Carolina and Pennsylvania has intensified the party’s determination to install justices who could give lawmakers fresh opportunities to muscle through more advantageous maps.

“The stakes in this election are going to be as high as the Senate race,” said Robert Paduchik, the Republican chair of Ohio, where an open U.S. Senate seat is up for grabs.

There are nearly 90 state supreme court seats on the ballot nationally this year, according to the elections website Ballotpedia, and control of the top courts in Ohio, North Carolina, Michigan and Illinois are all in play.

The Republican State Leadership Committee (RSLC), which supports down-ballot statewide candidates, plans to pour more than $5 million into the most high-profile contests. That would be a record for the group, which is one of dozens of organizations and political action committees likely to spend money on the races.

The investment will counter successful Democratic efforts – led by former U.S. Attorney Eric Holder’s National Democratic Redistricting Committee – to use state court lawsuits to fight Republican-approved maps, said RSLC spokesperson Andrew Romeo.

“We know that controlling state legislatures alone is no longer enough to stop liberal gerrymandering,” Romeo said, referring to Democrats’ strategy as “Sue Until it’s Blue.”

NDRC and other Democratic-aligned groups are marshaling their own resources, saying Republicans will otherwise have free rein to manipulate district lines to entrench power in Congress and in state legislatures.

Kelly Burton, NDRC’s president, said justices from both parties have reprimanded Republicans “for gerrymandering maps so egregiously as to prevent free and fair elections.”

Democrats face long odds in November’s elections to maintain their fragile majority in the U.S. House of Representatives.

State supreme courts played a significant role during the 2020 election and its aftermath, issuing rulings on everything from mail-in ballots to former President Donald Trump’s false claims of voter fraud.

State supreme court races saw nearly $100 million in spending between 2019 and 2020, by far a new record, according to a report from New York University’s Brennan Center for Justice. That total included some $35 million from outside interest groups.

The report’s author, Douglas Keith, said he expects even higher spending this year given the courts’ importance for partisan agendas.

“It is absolutely on stakeholders’ minds that these courts are positioned to play a significant role in the 2024 election,” he said.

OHIO COURT ‘HANGS IN THE BALANCE’

In Ohio, three Republican seats on the seven-judge court are on the ballot this year.

The state party cut an ad criticizing Democratic Justice Jennifer Brunner, who is running for chief justice, for a 2020 fundraiser headlined by Holder, whose group has filed lawsuits challenging Ohio’s congressional maps.

The court is split 4-3 in favor of Republicans. But Chief Justice Maureen O’Connor, a Republican retiring at year’s end, sided with the Democratic minority in throwing out a Republican-backed congressional map in January – drawing threats of impeachment from some Republican lawmakers.

Republicans sidestepped the decision by adopting a second map that appears likely to remain in place for November’s elections while the litigation is pending. Installing a new chief justice could give Republicans a more receptive court ahead of the 2024 election cycle.

This fall marks the first time that the ballot will list party affiliations for state supreme court hopefuls. The change, approved by the Republican-majority legislature, is expected to benefit the party’s candidates given Ohio’s Republican lean.

The state Chamber of Commerce, which has endorsed the three Republican candidates, plans to spend $4 million this fall, said President Steve Stivers, a former congressman.

“The court hangs in the balance,” he said. “You can have a pro-business governor, a pro-business legislature, and if you have the wrong four people on the Supreme Court, you can go backward every day.”

OTHER BATTLEGROUNDS

In North Carolina, the Democrats’ 4-3 edge is at stake, with two Democratic seats up for election in November.

The RSLC released an advertisement in January accusing Democratic incumbent Sam Ervin of a conflict of interest in hearing redistricting litigation while also running for re-election.

Bobbie Richardson, the state Democratic Party chair, said Republicans have made “our judicial branch more and more partisan.” Democrats will be “investing heavily” to preserve a balanced court system, she said.

The Republican state party did not respond to a request for comment.

In Pennsylvania, Republicans were frustrated that the state’s Democratic-controlled top court approved a map earlier this year backed by Holder’s group over one favored by Republican lawmakers.

Pennsylvania does not have any supreme court elections in 2022. But the Republican-majority legislature is considering ditching statewide supreme court elections in favor of a system based on regional districts, which would lessen the voting power of Democratic cities such as Philadelphia and Pittsburgh.

Russ Diamond, a legislator running for lieutenant governor, is leading the effort. He said the current system creates a “natural gerrymander” favoring the largest counties.

Deborah Gross, the CEO and president of Pennsylvanians for Modern Courts, a reform group, said the motivation behind the proposed change was clear: “This is about Republicans trying to take over the court.”

(Reporting by Joseph Ax; Editing by Colleen Jenkins and Alistair Bell)

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Russian ex-journalist on trial for treason: ‘I will fight until the end’

by Reuters April 11, 2022
By Reuters

(Reuters) – Russian former reporter Ivan Safronov said ahead of the resumption of his treason trial on Monday that he plans to vigorously fight the charges against him and does not fear the prospect of being jailed.

Safronov, who covered military affairs for the Vedomosti and Kommersant newspapers before becoming an aide to the head of Russia’s space agency two months before his arrest in July 2020, faces up to 20 years in prison if found guilty.

He denies accusations of passing military secrets about Russian arms sales in the Middle East and Africa to the Czech Republic, a NATO member, while he worked as a reporter in 2017, calling them “a complete travesty of justice and common sense”.

His detention sent a chill through Russia’s media landscape, where controls were already tight and have been tightened further since Russia invaded Ukraine in February.

His trial resumes behind closed doors later on Monday.

Striking a defiant tone in personal correspondence seen by Reuters on Monday, Safronov said he harboured no illusions about the prospect of being imprisoned for his alleged offences.

“I will fight until the end, there is no doubt about that,” Safronov wrote in a letter sent from Moscow’s Lefortovo prison and dated March 26.

“If it’s a prison term, then it’s a prison term. It absolutely doesn’t scare me,” said the letter, shown to Reuters on condition the addressee remained anonymous.

Safronov has said state investigators pointed to his acquaintance with a Czech journalist he met in Moscow in 2010 who later set up a website which Safronov said he contributed to using information entirely based on open sources.

Since sending troops into Ukraine on Feb. 24, Moscow has introduced a law outlawing the use of certain terms to describe its military intervention in Ukraine, which it calls a “special military operation”.

That prompted many independent media outlets to close or relocate.

(Reporting by Reuters; editing by Philippa Fletcher)

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China March new bank loans jump, broad credit growth accelerates

by Reuters April 11, 2022
By Reuters

By Judy Hua and Kevin Yao

BEIJING -New bank lending in China rose more than expected in March, while broad credit growth accelerated from the previous month as the central bank kept policy accommodative to support the slowing economy.

Chinese banks extended 3.13 trillion yuan ($492 billion) in new yuan loans in March, up sharply from February and exceeding analyst expectations, data released by the People’s Bank of China on Monday showed.

Analysts polled by Reuters had predicted new yuan loans would rise to 2.68 trillion yuan in March. The new loans were higher than 2.73 trillion yuan a year earlier.

That pushed bank lending in the first quarter to a record 8.34 trillion yuan, up 8.7% from 7.67 trillion yuan in the first quarter of 2021 – the previous record.

“Bank loans and total social financing rose more than expected in March. This confirms that the government did loosen monetary policy,” said Zhiwei Zhang, chief economist at Pinpoint Asset Management.

“Strong credit supply is helpful, but the economy will likely stay weak with many cities under lockdown. The outlook of the COVID outbreaks and the zero (COVID) tolerance policy are the most important uncertainty the economy faces.”

Household loans, mostly mortgages, rose to 753.9 billion yuan in March, after contracting by 336.9 billion yuan in February, while corporate loans jumped to 2.48 trillion yuan last month from 1.24 trillion yuan in February.

China’s cabinet last week held out the prospect of more measures to support the economy under pressure from renewed COVID-19 outbreaks and a slowing global recovery.

MODEST EASING EXPECTED

To spur growth, the central bank has cut interest rates and banks’ reserve requirement ratio (RRR), with more easing steps expected.

“Credit growth will probably continue to accelerate in the coming months amid declines in borrowing costs and support to the housing market,” Sheana Yue at Capital Economics said in a note.

“We think policy easing will continue in the near term,” Yue said, expecting the central bank to cut the rate on its medium-term lending facility (MLF) by 10 basis points as early as on Friday.

Broad M2 money supply grew 9.7% in March from a year earlier, central bank data showed, above estimates of 9.2% forecast in the Reuters poll. M2 grew 9.2% in February from a year ago.

Outstanding yuan loans grew by 11.4% in March from a year earlier, compared with 11.4% growth in February. Analysts had expected 11.4% growth.

Growth of outstanding total social financing (TSF), a broad measure of credit and liquidity in the economy, quickened to 10.6% in March from a year earlier and from 10.2% in February.

TSF includes off-balance sheet forms of financing that exist outside the conventional bank lending system, such as initial public offerings, loans from trust companies and bond sales.

In March, TSF rose sharply to 4.65 trillion yuan from 1.19 trillion yuan in February. Analysts polled by Reuters had expected March TSF of 3.7 trillion yuan.

(Reporting by Judy Hua and Kevin Yao; editing by Barbara Lewis and Susan Fenton)

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Kremlin says there is no reason for Russian debt default

by Reuters April 11, 2022
By Reuters

(Reuters) – The Kremlin said on Monday that Russia had the resources to pay its debt so there was no objective reason for a default.

“There can only be a technical, man-made default,” Kremlin spokesman Dmitry Peskov told reporters.

“There are no objective reasons for such a default. Russia has everything it needs to fulfil all its obligations,” Peskov said.

(Reporting by Reuters; editing by Guy Faulconbridge)

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Hong Kong police arrest veteran journalist for alleged sedition

by Reuters April 11, 2022
By Reuters

By Jessie Pang

HONG KONG – Hong Kong’s national security police arrested a veteran journalist and former contributing writer with the now-shuttered liberal media outlet Stand News, on Monday for alleged sedition, police and local media said.

A crackdown on the media based on a sedition law that dates from the British colonial-era, as all as a China-imposed national security law has seen several major media outlets raided by police and closed down, including the Apple Daily newspaper and the Stand News online news portal.

Local police said in a statement that the national security department of the police force had arrested a 54 year-old male for “conspiracy to publish seditious publications” and had detained him for further investigation.

Local media indentified the man as Allan Au, a veteran journalist and academic at the Chinese University of Hong Kong who wrote columns for newspapers including Ming Pao and the now closed Apple Daily.

Reuters was not able to immediately reach Au for comment.

Sedition is not among the offences listed under a sweeping national security law imposed by Beijing in June 2020 that punishes terrorism, collusion with foreign forces, subversion and secession with possible life imprisonment.

But court judgments in recent months have enabled authorities to use powers conferred by the new legislation to deploy rarely used colonial era laws covering sedition.

When questioned about Au’s arrest, Hong Kong leader Carrie Lam told a news conference she would not comment on individual cases, but said press freedom was enshrined in the city’s mini-constitution, the Basic Law.

The Hong Kong Journalists’ Association expressed “deep concern” and said the arrest risked “further damaging Hong Kong’s press freedom”.

Au, who was known for his critical columns, is a former Knight Fellow at Stanford University.

“I once wondered whether I could keep writing till 2047, but it’s a delusion in the end,” Au wrote in one of his last published columns, referring to China’s constitutional promise under the Basic Law to keep Hong Kong’s freedoms and autonomy intact for 50 years until 2047.

“We still haven’t reached 2047, but 2047 has arrived before our very eyes,” Au wrote.

Au’s arrest adds to the number of journalists targeted after the enactment of the security law. Two former senior editors of Stand News had also been charged in December with conspiring to publish and or reproduce seditious publications.

(Reporting by Jessie Pang; Editing by James Pomfret and Barbara Lewis)

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Financial News

Japanese investors remain big sellers of overseas bonds in March

by Reuters April 11, 2022
By Reuters

(Reuters) – Japanese investors were big sellers of overseas debt in March, as prices of overseas bonds declined on concerns over inflation and aggressive tightening measures by major central banks.

According to Japan’s Ministry of Finance data, domestic investors exited a net 2.36 trillion Japanese yen worth of overseas bonds last month, after selling a net 3.2 trillion in February.

They also sold foreign equities worth $455.7 billion yen, after buying them in the previous month.

“Selling of foreign bonds increased later in the month, indicating that they became more worried about a hawkish pivot from the Federal Reserve around the FOMC,” said Naka Matsuzawa, chief Japan macro strategist at Nomura.

The big sales by local investors come despite a sharp decline in the Japanese yen in the last month.

Japanese investments in overseas assets – https://tmsnrt.rs/3uqEav6

“JPY collapsed in March, just at the time when local investors were bringing almost unprecedented amounts of capital home,” Adam Cole, chief currency strategist at RBC Capital Markets said in a note.

He added that many of the bonds sold were likely held on an FX hedged basis, implying limited FX flow and reflecting the low cost of hedging in all G10 markets for the last two years.

The cumulative sales of foreign bonds and equities in the first quarter of this year stood at 5.28 trillion yen, the biggest net selling in eight years.

The Bank of Japan (BoJ) in its monetary policy meeting in March, maintained its massive stimulus amid uncertainty over the global outlook, reinforcing expectations it would remain an outlier in the global shift towards tighter monetary settings.

The data from Bank of Japan showed Japanese investors sold U.S. bonds and equities worth 3.11 trillion yen and 127 billion yen, respectively, in the first two months of this year.

However, they purchased 1.16 trillion worth of European bonds in the same period and sold 232 billion yen in European equities.

Japanese investors also offloaded Chinese bonds of 294.69 billion yen and equities of 25.26 billion yen, data up to February showed.

Japanese investments in US and European assets: https://tmsnrt.rs/3JmULEk

($1 = 124.9900 yen)

(Reporting by Gaurav Dogra and Patturaja Murugaboopathy in Bengaluru; Editing by Amy Caren Daniel)

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Drugmakers pledge speedier European market launches to avert stricter regulation

by Reuters April 11, 2022
By Reuters

FRANKFURT – Drugmakers on Monday pledged to speed up the market launch of new drugs in underserved EU member states in a bid to avert stricter regulation by Brussels.

European Federation of Pharmaceutical Industries and Associations (EFPIA) said in a statement on Monday its members pledge to file for reimbursement by national health systems no later than two years after EU regulatory approval, “provided that local systems allow it”.

While EU drug approval is largely centralised, with the European Medicines Agency acting as watchdog, procedures to subsequently set the treatment price for national health systems remain in the hands of member states and differ greatly.

The pledge would reduce the time patients wait for new medicines by four to five months in several countries such as Bulgaria, Poland and Romania, EFPIA said, citing estimates by market researcher IQVIA.

The lobby group warned that any new rules forcing drugmakers to bring new products to all EU countries within a certain deadline could backfire and discourage companies from bringing some products to public health systems in the region altogether.

“We understand that some of the proposals being discussed could introduce obligations for (drugmaker) to market or supply all EU Member States,” EFPIA said in a separate report.

“The industry has concerns regarding the use of regulatory tools designed for medicines authorisation being applied to address availability issues that are within the remit of member states,” it added.

The average lag between EU market clearance and large patient groups receiving a newly developed drug varies greatly within the bloc, ranging from 133 days in Germany and 497 days in France to 899 days, or 2.5 years, in Romania, according to the report.

EFPIA said that the delays were influenced by several regulatory factors beyond companies’ control.

The lobby group also said it was proposing a harmonised system of tiered drug pricing, based on a country’s ability to pay, to replace the highly diverse EU price-setting landscape.

(Reporting by Ludwig Burger; Editing by Lisa Shumaker)

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