Day: June 28, 2018

A U.S. delegation traveled to Kenya on Thursday to attend the inaugural economic summit of the American Chamber of Commerce, Kenya.

About 500 delegates, including Kenyan President Uhuru Kenyatta and Gilbert Kaplan, U.S. undersecretary of commerce for international trade, other high-ranking government officials from both nations and representatives from nearly 30 major U.S. corporations, gathered at the summit, which was aimed at creating partnerships between the two nations’ public and private sectors in order to foster economic growth. 

The Kenyan agenda was centered on advancing Kenyatta’s “Big Four” priorities — universal health care, manufacturing, food security and affordable housing — that he set out after his re-election to a second term last year.

American companies in attendance were looking for opportunities to expand and to increase trade and investment in Africa.

Kaplan told VOA that increasing business and economic development in Africa would benefit many Americans, which aligns with the promises of President Donald Trump’s “Make America Great Again” agenda. 

“If we can export more and do more transactions here, do more investment here, that’s going to be incredibly helpful for the United States, for the people back home, because we’ll be making profitable ventures, and that will naturally help,” he said.

But the U.S. delegation also had a strong message for Kenya: Real, meaningful economic growth can’t happen unless Kenya commits to fighting corruption.

​’It’s got to stop’

“Corruption is undermining Kenya’s future,” said Robert Godec, U.S. ambassador to Kenya. “It’s clearly a major problem for the country. We welcome President Kenyatta’s commitment and the push recently to address this problem. Corruption is theft from the people, and it’s got to stop.”

In his speech to the delegation, Kenyatta pledged to “fight this animal called corruption and ensure that it is a beast that shall never infect or inflict future generations” of Kenyans. 

Kaplan told VOA that the U.S. government was providing support and training to the Kenyan government to help tackle corruption.

“We’ve dealt with that — the Foreign Corrupt Practices Act, rule of law and international standards,” he said. “I think we can convince Kenya that following those rules is ultimately to their benefit because it brings more businessmen and women into the system and being able to be successful.” 

Part of the objective of the Foreign Corrupt Practices Act is to make it illegal for companies and their supervisors to influence foreign officials with personal payments or rewards.

C.D. Glin, president and chief executive of the U.S. African Development Foundation, told VOA that the U.S. government’s and private sector’s support of businesses in Africa that had ramped up under the previous administration was being continued by Trump.

For instance, the President’s Advisory Council for Doing Business in Africa, begun under the Barack Obama administration and still in force, “really is looking at Africa from a business standpoint and from an opportunity standpoint so that Africans can benefit from U.S. support, but also can support the U.S.,” Glin said.

​Major boost

Nicholas Nesbitt, chairman of the Kenya Private Sector Alliance, said the increased U.S. private sector investment had been hugely beneficial for the Kenyan economy.

“We see a lot more tourism coming to Kenya, a lot more trade and a lot more business,” he said. “We’re very excited to see the numbers of American companies — small, midsize and even large corporations — looking at Kenya as a destination. It’s also a gateway to east Africa, where there are 200 million potential consumers. So, the investments, the energy, the excitement is absolutely tremendous today at this summit between American and Kenyan business.”

Six commercial deals between Kenyan and American companies were signed at the summit. Maxwell Okello, chief executive of the American Chamber of Commerce, Kenya, called that a sign that significant economic change would be driven by private sector innovation.

“I think at the end of the day, with what we’re hearing today here, it’s really down to what the private sector wants to do from a commercial engagement,” he said. “And I believe conversations such as this is really where you spark that interest, where you create those linkages and the sort of engagement that you need. And the opportunities are there for anyone. They’re obvious.

“So, I think that various policies aside, from a commercial business engagement perspective, the sky is wide open.” 
…

Importers of Iranian oil are facing pressure from the United States to find another energy source or be hit with sanctions.

The Trump administration is threatening other countries, including close allies such as South Korea, with the sanctions if they don’t cut off Iranian imports by early November, essentially erecting a global blockade around the world’s sixth-biggest petroleum producer.

South Korea accounted for 14 percent of Iran’s oil exports last year, according to the U.S. Energy Department. China is the largest importer of Iranian oil with 24 percent, followed by India with 18 percent. Turkey stood at 9 percent, and Italy at 7 percent.

A State Department official told reporters this week that the “vast majority” of countries will comply with the U.S. request. A group from the State Department and the National Security Council is delivering the president’s message in Europe. The official added that the group had not yet visited China or India.

President Donald Trump announced in May that he would pull the United States out of a 2015 agreement over Iran’s nuclear program, and would re-impose sanctions on Tehran. Previously, the administration said only that other countries should make a “significant reduction” in imports of Iranian crude to avoid U.S. sanctions.

European allies will reluctantly go along to avoid sanctions on their companies that do business in the U.S., said Jim Krane, an energy and geopolitics expert at Rice University. However, China, India and Turkey might be less likely to fully cut off Iranian imports, he said.

Antoine Halff, a researcher at Columbia University and former chief oil analyst for the International Energy Agency, said it’s not unusual for the U.S. government to seek cooperation from other importers of Iranian oil — President Barack Obama’s administration did it during a previous round of sanctions.

“The difference is that there was broad international support for the sanctions then,” while the move to restore sanctions now over Iran’s nuclear program “is a unilateral decision from the United States alone,” Halff said.

The Trump administration is counting on Saudi Arabia and other OPEC members to supply enough oil to offset the lost Iranian exports and prevent oil prices from rising sharply.

The State Department official, who spoke on condition of anonymity, said the U.S. will be talking in a week or so “with our Middle Eastern partners to ensure that the global supply of oil is not adversely affected by these sanctions.”

Members of the Organization of the Petroleum Exporting Countries agreed over the weekend to boost oil production by about 600,000 barrels a day. Iran exported about 1.9 million barrels a day during the first quarter of this year, according to OPEC figures. It is the world’s seventh largest oil exporter.

“It would not be a heavy lift for OPEC to replace Iran’s contribution to world oil markets — Saudi Arabia could probably do it on its own,” Krane said. “Saudi spare capacity protects the U.S. motorist from U.S. foreign policy.”
…

President Donald Trump was highlighting his economic policies Thursday by taking part in the ceremonial ground-breaking for a $10 billion Foxconn factory complex that may bring thousands of jobs to a state he barely carried in the 2016 presidential election.

But Trump’s celebration comes amid less-rosy economic news, with Harley-Davidson’s announcement it’s moving some motorcycle production overseas to avoid European Union tariffs that are a product of Trump’s escalating trade dispute with long-standing U.S. allies.

The president was irked by the Milwaukee-based company’s announcement this week and tweeted about it for three straight days, writing that any shift in production “will be the beginning of the end” for the iconic American manufacturer and even threatening retaliatory taxes.

Trump’s presence in Wisconsin was the subject of protests both in Milwaukee, where he spent a rare weeknight away from the White House, and in Mount Pleasant, where final preparations were under way for the ground-breaking.

Chants of “Hey, hey, Ho, ho. Donald Trump has got to go” were heard near the Pfister Hotel, where Trump overnighted and attended a pair of closed-door campaign events before heading to the groundbreaking and tour of an existing Foxconn facility. Gov. Scott Walker and House Speaker Paul Ryan, R-Wis., were among those joining the president at the fundraisers. 

About 50 people walked from a downtown park to as close as they could get to the roped-off hotel, hoping Trump hears their calls to reunite migrant families separated at the U.S.-Mexico border after the president decide to prosecute everyone trying to enter the U.S. illegally.

As the president hobnobbed with supporters, his wife, Melania, was making her second trip in a week to the southern border to visit detention centers housing migrant children. She toured a Texas center last Thursday.

Christine Neumann-Ortiz, executive director of Voces de la Frontera, an immigrant rights organization, said the family separation issue is not unique to border communities. She said it’s also happening in the U.S. interior where deportations have increased.

“The scale of human rights violations that are being inflicted on children and families by the current administration should shake us to our core,” she said.

Protesters were also gathering near the Foxconn Technology Group campus in Mount Pleasant, about 30 miles south of Milwaukee.

Nearly 40 groups representing students, environmentalists, civil rights advocates, teachers, union workers and others have organized an event featuring dozens of speakers, a marching band, singers and musicians who plan to play ominous “Star Wars” music.

Foxconn is the world’s largest electronics contract manufacturer and assembles Apple iPhones and other products for tech companies. Based in Taiwan, it chose Wisconsin after being prodded by Trump and others, including Ryan, whose district will include the plant.

The project could employ up to 13,000 people, though opponents say it is costing Wisconsin taxpayers too much.

The ceremonial groundbreaking was supposed to be evidence that the manufacturing revival fueled by Trump’s “America First” policy is well underway. But Harley-Davidson’s announcement, spurred by the trans-Atlantic tariff fight, appears to have turned that on its head.

Walker is counting on a strong economy as part of his case for re-election in November. Wisconsin’s unemployment is at record-low levels and Walker argues that the Foxconn project, the largest economic development deal in state history, shows the state is on the right track.

When the deal, reached with assistance from the White House, was signed last year, Walker said critics could “suck lemons” and “all of us in the state should be smiling, Republican and Democrat, doesn’t matter.”

A year later, opinion polls show Wisconsin voters are split on the project and the state of the economy.

Trump carried Wisconsin by less than 1 point — just under 23,000 votes. He’s underwater in popularity, with only 44 percent of respondents in last week’s Marquette University Law School poll approving of the job he’s doing, while 50 percent disapproved.

Republicans were mostly unified in support of Foxconn, saying it is a once-a-generation opportunity to transform the state’s economy. But most Democrats — including all eight of those running against Walker — are against it, arguing the potential $4.5 billion in taxpayer subsidies was too rich. If paid out — they’re tied to jobs and investment benchmarks — the incentives would be the most paid to a foreign company in U.S. history.

Should Foxconn employ 13,000 workers as envisioned, it would be the largest private-sector employer in Wisconsin.

“Foxconn’s state-of-the-art products will be made in the U.S.A. — proudly in the state of Wisconsin!” Walker tweeted Tuesday, as he tried to shift the focus away from Harley-Davidson.

 
…

China defended its trade practices Thursday as being beneficial to the world as it tries to ease pressure from the United States and Europe to abandon what they consider to be Beijing’s protectionist policies.

China’s rapid economic growth “has brought great opportunities to trading partners all over the world,” Vice Commerce Minister Wang Shouwen said at a Beijing news conference.

Wang unveiled a report highlighting reforms China has taken since joining the World Trade Organization in 2001.He said Beijing has “carried out every promise” since joining the WTO.

Wang’s defense of China’s business practices come amid threats of a trade war with the United States and arguments by Europe and Washington that China limits access to emerging industries and steals or forces other countries to hand over technology.

Trump’s threat of tariff increases on Chinese goods worth up to $450 billion reflects fears that China’s actions are a threat to America’s technological leadership.Germany and other countries have complained that Beijing prohibits purchases of Chinese assets while Chinese companies engage in a worldwide spending spree.

The dispute with Trump has allowed China, which has the world’s second largest economy, to position itself as a defender of free trade.When asked about possible U.S. plans to limit Chinese investment in its technology sectors, Wang said, “We hope countries concerned can do the right thing and adopt policies that support free trade and investment.”

The U.S. and other trading partners maintain China’s emergence in the smartphone, solar and other technology sectors means it should no longer be afforded protections it was granted as a developing country when it joined the WTO.

China has offered to cut its multi-billion trade surplus with the United States, but has refused to abolish a strategy that its Communist leaders believe is a path to increased global influence and prosperity.

China and the European Union announced this week they will form a group to update WTO rules to keep pace with global economic developments.
…

Jared Kushner’s family company is suing a New Jersey city, alleging it forced the delay of a major twin-tower project due to “political animus” toward President Donald Trump.

The federal lawsuit filed Wednesday by the Kushner Cos. claims Jersey City and the city’s redevelopment agency “put politics over principle” when they broke a contract with developers over the planned One Journal Square project, according to a report in the Jersey Journal.

Trump is a Republican. Jersey City Mayor Steven Fulop, a defendant in the suit, is a Democrat.

The Kushner Cos. previously threatened a lawsuit in April after the Jersey City Redevelopment Agency said developers were in default because they missed a deadline to begin construction on the project.

Fulop dismissed the lawsuit, saying it amounts to “hearsay nonsense.” He said “it’s not like the Kushners have a great deal of credibility in anything they say” and that “they will do anything to manipulate a situation.”

The lawsuit is seeking to stop the city from ending the project’s contract and declare the notice of default null and void. It calls the default threat a “transparent pretext to enhance Fulop’s status among the electorate of the city.”

Joseph Fiorenzo, the company’s lawyer, said the “outrageous conduct” of city officials “strikes at the very heart of our economic system which has, as its foundation, the freedom of people to organize their affairs by entering into contracts. This is the glue that holds our economic system together.”

The suit also names the city and the redevelopment agency as defendants.

 
…

Two major auto trade groups on Wednesday warned the Trump administration that imposing up to 25 percent tariffs on imported vehicles would cost hundreds of thousands of auto jobs, dramatically hike prices on vehicles and threaten industry spending on self-driving cars.

A coalition representing major foreign automakers including Toyota Motor Corp, Volkswagen AG, BMW AG and Hyundai Motor Co, said the tariffs would harm automakers and U.S. consumers. The administration in May launched an investigation into whether imported vehicles pose a national security threat and President Donald Trump has repeatedly threatened to quickly impose tariffs.

“The greatest threat to the U.S. automotive industry at this time is the possibility the administration will impose duties on imports in connection with this investigation,” wrote the Association of Global Automakers representing major foreign automakers. “Such duties would raise prices for American consumers, limit their choices, and suppress sales and U.S. production of vehicles.”

The group added: “Rather than creating jobs, these tariffs would result in the loss of hundreds of thousands of American jobs producing and selling cars, SUVs, trucks and auto parts.”

On Friday, Trump threatened to impose a 20 percent tariff on all imports of EU-assembled cars. On Tuesday, Trump said tariffs are coming soon.

“We are finishing our study of Tariffs on cars from the E.U. in that they have long taken advantage of the U.S. in the form of Trade Barriers and Tariffs. In the end it will all even out — and it won’t take very long!” Trump tweeted.

The Alliance of Automobile Manufacturers, representing General Motors Co, Ford Motor Co, Daimler AG , Toyota and others, urged the administration in separate comments filed Wednesday not to go forward.

“We believe the resulting impact of tariffs on imported vehicles and vehicle components will ultimately harm U.S. economic security and weaken our national security,” the group wrote, calling the tariffs a “mistake” and adding imposing them “could very well set a dangerous precedent that other nations could use to protect their local market from foreign competition.”

The Alliance said its analysis of 2017 auto sales data showed a 25 percent tariff on imported vehicles would result in an average price increase of $5,800, which would boost costs to American consumers by nearly $45 billion annually.

Automakers are concerned tariffs would mean less capital to spend on self-driving cars and electric vehicles.

“We are already in the midst of an intense global race to lead on electrification and automation. The increased costs associated with the proposed tariffs may result in diminishing the U.S.’ competitiveness in developing these advanced technologies,” the Alliance wrote.

Toyota said in a statement Wednesday that new tariffs “would increase the cost of every vehicle sold in the country.” The automaker said the tariffs would mean even a Toyota Camry built in Kentucky “would face $1,800 in increased costs.”

Both automotive trade groups cited a study by the Peterson Institute for International Economics that the cost to U.S. jobs from the import duties would be 195,000 jobs and could be as high as 624,000 jobs if other countries retaliate.

The German Association for Small and Medium-sized Businesses said the “pattern of rising protectionism is very likely to continue if the U.S. decide to impose tariffs on foreign automobiles and automobile parts, thus causing tremendous damage to both economies.”

Alabama Governor Kay Ivey, a state that produced nearly 1 million vehicles and 1.7 million engines built by foreign automakers last year, urged the Commerce Department not to invoke the tariffs. She said job losses from new levies could be “devastating.”

The proposed tariffs on national security grounds have been met by opposition among many Republicans in Congress.

Trump has made the tariffs a key part of his economic message and repeatedly lamented the U.S auto sector trade deficit, particularly with Germany and Japan. Some aides have suggested that the effort is a way to try to pressure Canada and Mexico into making more concessions in ongoing talks to renegotiate the North American Free Trade Agreement.

U.S. Commerce Secretary Wilbur Ross said on Thursday the department aimed to wrap up the probe by late July or August. The Commerce Department plans to hold two days of public comments in July on its investigation of auto imports.

The Commerce Department has asked if it should consider U.S. owned auto manufacturers differently than foreign automakers.

The Association of Global Automakers rejected that contention, saying its members’ American workers “are no less patriotic or willing to serve their country in a time of crisis than any other Americans.”

The group questioned national security as grounds to restrict auto imports. “America does not go to war in a Ford Fiesta,” they added.

The Alliance said “there is no basis to claim that auto-related imports are a threat to national security” and noted that 98 percent of U.S. auto imports came from U.S. national security allies.
…