Day: February 28, 2019

Online crafts retailer Etsy Inc will go green by offsetting planet-warming carbon emissions from its shipping activities, the U.S. company said Wednesday, joining a host of companies making public moves to battle climate change.

Etsy will buy clean energy certificates supporting tree conservation in the United States, wind and solar power in India and clean automotive technology, it said.

The online marketplace for buying and selling handmade and vintage goods said its initiative is the first time a global e-commerce company has made such a move.

“Fast, free shipping ultimately comes at a cost to our planet,” wrote Josh Silverman, chief executive officer of the New York-based company in a blog on the company’s website.

The certificates are a way for companies to offset the amount of carbon dioxide they produce by paying for projects that support clean development.

The 13-year-old Etsy said its greenhouse gas emissions from shipping in 2018 totaled about 135,000 metric tons of carbon dioxide equivalent, similar to those of 29,000 cars in a year.

About 55,000 metric tons of carbon dioxide equivalent are released each day from the delivery of all packages ordered from online retailers in the United States alone, it said.

Budweiser, Amazon.com

Last month, at the U.S. Super Bowl championship game, giant beer maker Budweiser helped purchase clean energy certificates to offset greenhouse gas emissions linked to fans’ travel and the host city of Atlanta.

More than 100 U.S. companies have committed to setting emission-reduction targets that seek to limit rising temperature to 2 degrees Celsius as part of a United Nations-backed initiative, said Sabrina Helm, who heads the Consumers, Environment & Sustainability Initiative, a research group at the University of Arizona.

Online retailers have largely been absent from those efforts, and Etsy’s move sends a “very important signal,” she said.

“A lot of online retailers are not particularly transparent in what they do in terms of sustainability,” she told Reuters.

Last week, online retail giant Amazon.com Inc said it planned to make its carbon footprint public for the first time this year.
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The United States won a World Trade Organization ruling Thursday that China subsidized its wheat and rice producers too much in recent years.

The WTO in Geneva agreed with the U.S. position that Beijing paid its farmers excessive amounts for growing wheat, Indica rice and Japonica rice from 2012 to 2015, but said the dispute over a corn subsidy had already expired.

The ruling came in a U.S. complaint filed in 2016 during the final months of the last U.S. administration of former president Barack Obama.

The decision can be appealed, but current U.S. Trade Representative Robert Lighthizer praised the ruling.

“China’s excessive support limits opportunities for U.S. farmers to export their world-class products to China,” Lighthizer said in a statement. “We expect China to quickly come into compliance with its WTO obligations.”

The U.S. claimed that China paid its farmers nearly $100 billion more than WTO rules allow, creating an incentive to grow more wheat and rice, thus undercutting global prices for the grains.

The ruling could have ramifications for India, which has calculated its price supports in a similar way as China.

The WTO decision comes amid intense trade talks between Washington and Beijing, with President Donald Trump expressing optimism a deal can be reached.

During a news conference in Hanoi after the abrupt end of his summit with North Korean leader Kim Jong Un, Trump said, “I think we have a very good chance. Their (economic growth) numbers are down, but I don’t want that.  I want (China) to do great. But we’ve been losing anywhere from $300 to $500 billion dollars a year with China for many, many years. And again, like other things, many presidents should have done this before me. And nobody did. So, we’re doing it.”

The most recent U.S. statistics show China last year had a $382 billion trade surplus in deals with the United States through November. Trump is trying to alter trade terms between the two countries to end what the United States, Japan and European countries contend are China’s unfair trade practices, including state intervention in markets, subsidies of some industries and theft of foreign technology.

But Lighthizer on Wednesday told a congressional panel in Washington, a new deal is not close to being completed.

“Much still needs to be done before an agreement can be reached,” he said. “If we can complete this effort, and again I say if, and if we can reach a resolution on the issue of enforceability, we might have an agreement that enables us to turn the corner in our relationship with China.”

The United States and China, the world’s two biggest economies, have been negotiating for months on a new agreement, even as they have imposed hefty new tariffs on billions of dollars of each other’s exports.

Lighthizer said the countries’ negotiators, who have been meeting in Washington and Beijing, “are making real progress.”

Trump cited that progress on Sunday in postponing what would have been a sharp increase in U.S. duties on $200 billion in Chinese imports that would have taken effect Friday.

China has offered to increase its purchase of American farm products and energy as part of a new trade pact.

 
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The U.S. economy fell short of the Trump administration’s 3 percent annual growth target in 2018 despite $1.5 trillion in tax cuts and a government spending blitz, and economists say growth will only slow from here.

A better-than-expected performance in the fourth quarter pushed gross domestic product up 2.9 percent for the year, just shy of the goal, Commerce Department data showed Thursday.

President Donald Trump has touted the economy as one of the biggest achievements of his term and declared last July that his administration had “accomplished an economic turnaround of historic proportions.” On the campaign trail, Trump boasted that he could boost annual economic growth to 4 percent, a goal that analysts always said was unachievable.

“We are moving back to a sustainable growth pace that we experienced during most of the Obama years,” said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania. “With the tax cut impacts largely done with, it is hard to see how growth can accelerate sharply.”

Gross domestic product increased at a 2.6 percent annualized rate in the fourth quarter after advancing at a 3.4 percent pace in the July-September period. Economists polled by Reuters had forecast GDP rising at a 2.3 percent rate in the fourth quarter.

Growth in 2018 was the strongest since 2015 and better than the 2.2 percent logged in 2017. The expansion will be the longest on record in July.

The stronger-than-expected fourth-quarter performance, which reflected solid consumer and business spending, was despite many headwinds, including financial market volatility and the United States’ trade war with China, raising optimism that an anticipated slowdown this year would not be abrupt.

The fiscal stimulus is believed to have peaked sometime in the fourth quarter. December economic data such as retail sales, exports, homebuilding and business spending on equipment weakened sharply.

In addition, most manufacturing measures softened in January and February, and motor vehicle demand has eased.

The labor market is also exhibiting signs of cooling, with a report from the Labor Department on Thursday showing the number of Americans receiving unemployment benefits rising to a 10-month high in the week ended Feb. 16.

“The first quarter won’t be this good,” said Paul Ashworth, chief economist at Capital Economics in Toronto. “As the stimulus fades and the lagged impact of past monetary tightening continues to feed through, we expect GDP growth to slow to 2.2 percent this year.”

Slowing growth together with weakening global demand and uncertainty over Britain’s departure from the European Union, support the Federal Reserve’s “patient” stance toward raising interest rates further this year. Fed Chairman Jerome Powell reaffirmed the U.S. central bank’s position in his testimonies before lawmakers Tuesday and Wednesday.

Inflation was largely muted in the fourth quarter.

The dollar trimmed losses against a basket of currencies on the GDP data and was last trading little changed. U.S. Treasury prices fell, while stocks on Wall Street were lower following weak earnings from a handful of companies.

Solid consumer spending

The fourth-quarter GDP report was delayed by a 35-day partial shutdown of the government that ended on Jan. 25, which affected the collection and processing of economic data. The Commerce Department said it could not quantify the full effects of the shutdown on fourth-quarter GDP growth.

Economists expect the longest shutdown in history will hurt growth in the first quarter. Growth in consumer spending, which accounts for more than two-thirds of U.S. economic activity, increased at a still strong 2.8 percent rate in the fourth quarter. Consumer spending grew at a robust 3.5 percent rate in the third quarter.

Consumption continues to be underpinned by a strong labor market, with inflation-adjusted income at the disposal of households jumping at a 4.2 percent rate in the fourth quarter compared to a 2.6 percent pace in the prior period.

A moderation in spending is, however, likely amid reports 2018 tax refunds have been smaller than in the previous years.

Business spending on equipment accelerated in the fourth quarter from the prior period, growing at a 6.7 percent rate, after losing speed since the first quarter of 2018.

Inventory accumulation

The trade deficit widened further as a combination of the U.S.-China trade dispute, strong dollar and weakening global demand restrained export growth. The trade tensions also led businesses to hoard imports.

The trade shortfall subtracted 0.22 percentage point from fourth-quarter GDP growth after slicing off 2 percentage points in the July-September period. With consumer spending slowing, some of the imports ended up in warehouses, accelerating the pace of inventory accumulation.

While that offset some of the drag on GDP growth from the trade deficit, the piling up of stock is bad news for first-quarter growth.

Inventories increased at a $97.1 billion rate in the fourth quarter after rising at an $89.8 billion pace in the July-September quarter. Inventory investment added 0.13 percentage point to GDP growth last quarter after contributing 2.33 percentage points in the prior period.

“There was a rapid buildup of inventories in the fourth quarter, so inventories likely will be a headwind for growth in the future,” said Daniel Silver, an economist at JPMorgan in New York.

Residential construction contracted at a 3.5 percent rate, marking the fourth straight quarterly decline. Homebuilding has been weighed down by higher mortgage rates, land and labor shortages as well as tariffs on imported lumber.

Government investment increased at a 0.4 percent rate, the slowest since the third quarter of 2017. Nondefense investment contracted at a 5.6 percent rate, the biggest decline in five years, likely reflecting the effects of the five-week government shutdown.
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