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China’s GDP, dubious COVID statistics and East Timor’s election | Business and Economy

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Not for the first time, China once again dominated the news this week.

The release of new economic data provided a temperature check of the world’s second-largest economy, while dubious COVID-19 death rates focused attention on Beijing’s reputation for secrecy and narrative control at all costs.

Elsewhere, Asia’s youngest nation went to the polls, and Japan got a rare taste of rising inflation after decades of sluggish economic growth.

Here are the numbers you should know to get on top of this week’s economic and business news.

4.8 percent

The amount by which China’s economy grew year on year in January-March, according to official government data.

The first quarter performance beat most forecasters’ predictions, but reflected only a fraction of the effect of lockdowns imposed on Chinese cities, including the financial capital Shanghai, since late March.

Even without accounting for economically-crippling lockdowns, the economic data hinted at storm clouds on the horizon: retail sales, a key indicator of economic health, fell 3.5 percent in March compared with the same period last year.

Analysts expect much worse to come, as Chinese President Xi Jinping signals his intention to hew to a zero-tolerance approach towards the virus long after the rest of the world has moved on from the pandemic.

The IMF and banks including UBS, the Bank of America and Barclays this week downgraded their growth forecasts for China in 2022.

Nomura’s especially pessimistic forecast, 3.9 percent, would mark China’s slowest growth rate since 1990 – apart from 2020, when the pandemic derailed the global economy.

38

The number of COVID-19 deaths China has reported from coronavirus outbreaks since the beginning of March.

To say the figure has raised eyebrows would be an understatement.

With some 550,000 cases reported so far, most of them in Shanghai, the official death toll flies in the face of all international experience with the virus.

By comparison, South Korea – with a superior vaccination rate – reported a death rate of about 0.12 percent during its most recent wave.

Applying the same ratio to China would translate to about 660 deaths.

Some health experts quoted in international media have attributed the discrepancy to Chinese authorities’ longstanding practice of focusing on underlying causes of death such as cancer and heart disease.

Others question whether Beijing is intentionally distorting the picture to save face after expending so much political capital claiming its response to the pandemic has been superior to that of the West.

62 percent

The share of the vote secured by independence leader and Nobel laureate Jose Ramos-Horta in East Timor’s presidential election.

Ramos-Horta, who previously served as president of the young nation from 2007-2012, scored a landslide against incumbent Francisco “Lu Olo” Guterres after a runoff vote on Monday.

Ramos-Horta, who has promised to reduce poverty, faces the challenge of diversifying the Southeast Asian country’s economy from oil and gas, which has accounted for more than 90 percent of government revenues in recent years.

The president-elect has said he expects East Timor, which gained its independence from Indonesia in 2022, to become the 11th member of the Association of Southeast Asian Nations this year.

0.8 percent

The amount by which Japan’s consumer prices rose year on year in March.

The core consumer price index (CPI), which does not include volatile fresh food prices but does cover fuel, rose from 0.6 percent in February – the fastest increase in more than two years.

Unlike other countries that are raising interest rates to tame soaring inflation, Japan has for decades grappled with the opposite problems of stagnation and deflation, and its central bank has pledged to maintain stimulus measures to boost growth.

While high inflation erodes people’s purchasing power, a moderate amount is considered a healthy sign of rising demand and economic growth.

For years, the world’s third-largest economy has tried in vain to reach a 2 percent inflation target with rock-bottom interest rates and fiscal stimulus ranging from tax cuts to cash handouts.

Soaring commodity prices due to the war in Ukraine and a weakening yen are now finally causing prices to meaningfully rise.

But that could be a double-edged sword.

While Japan’s inflation remains modest by international standards, a significant uptick could prove politically perilous in a country accustomed to decades of stagnant prices and meagre wage growth.

In a sign of the general public’s concern about the cost of living, Japanese households predicted inflation would hit 6.4 percent next year in a BOJ survey carried out earlier this month, Bloomberg reported. That was the highest reading since 2008.



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US urges probe, accountability for Shireen Abu Akleh’s killing | Israel-Palestine conflict News

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Washington, DC – The US State Department has renewed calls for a “thorough and transparent” investigation into the killing of Al Jazeera journalist Shireen Abu Akleh, who was fatally shot by Israeli forces last week, but stopped short of calling for an independent probe.

A day after the Israeli military said it will not launch a criminal inquiry into the incident, State Department spokesperson Ned Price said on Friday that Washington continues to call for a meaningful probe that will lead to accountability.

“Again, we’ve been clear that there must be a transparent and credible investigation of Ms. Abu Akleh’s killing and that any such investigation must include accountability,” he said.

The slain journalist was a US citizen.

Price did not address Israel’s refusal to conduct such an investigation. Last week, he said the Israeli government has the “wherewithal and the capabilities to conduct a thorough, comprehensive investigation” into the killing of Abu Akleh.

The administration of President Joe Biden had condemned the fatal shooting, but its expressed trust in an Israeli investigation into what happened has sparked anger and demands for an independent or US-led probe.

Earlier on Friday, 57 members of Congress sent a letter to Secretary of State Antony Blinken and FBI Director Christopher Wray urging US involvement in the investigation.

Signatories to the letter – all Democrats – include some vocal supporters of Israel as well as members of the progressive wing of the party.

“Given the tenuous situation in the region and the conflicting reports surrounding the death of Ms. Abu Akleh, we request the State Department and the Federal Bureau of Investigation (FBI) launch an investigation into Ms. Abu Akleh’s death,” the letter reads.

“We also request the US Department of State determines whether any US laws protecting Ms. Abu Akleh, an American citizen, were violated.

“As an American, Ms. Abu Akleh was entitled to the full protections afforded to US citizens living abroad.”

The Pentagon on Friday appeared to rule out the US military’s participation in any investigation into the killing, saying that there is no indication of a need for such involvement.

US Secretary of Defense Lloyd Austin met with his Israeli counterpart Benny Gantz on Thursday, and a Pentagon readout describing their talks did not make any mention of Abu Akleh.

“The secretary [Austin] brought up the issue and they discussed it, and he welcomed the Israeli government’s willingness to investigate,” Pentagon spokesman John Kirby said on Friday, more than 24 hours after the Israeli military said it will not pursue a criminal investigation into the incident.

The killing of Abu Akleh in Jenin in the occupied West Bank has reignited calls for reassessing US military aid to Israel.

The Al Jazeera journalist is the second American citizen to be killed by Israeli forces this year. In January, 78-year-old Omar Assad suffered a stress-induced heart attack after he was arbitrarily arrested, bound, blindfolded and gagged by Israeli forces.

Israel receives $3.8bn in US military aid annually, and this year Washington added another $1bn in assistance to “replenish” Israel’s Iron Dome missile defence system after the May 2021 Gaza conflict.

Late on Thursday, progressive Congresswoman Alexandria Ocasio-Cortez said US assistance should not fund human rights violations anywhere, including in Palestine.

“It’s really important for us to have eyes on what happened with Shireen Abu Akleh in Palestine. She was killed by Israeli forces – a venerated journalist, a US citizen,” Ocasio-Cortez said in a video broadcast on social media.

The congresswoman rejected accusations of singling out Israel for criticism, highlighting the role of US aid in the conflict.

“We can’t even get health care in the United States, and we’re funding this,” she said of rights abuses against Palestinians. “There has to be some sort of line that we draw; it has to stop at some point.”





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US, Taiwan trade officials discuss deepening relations | Politics News

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Meeting comes as US President Joe Biden began his first visit to Asia in push to show commitment to the region.

The United States’ top trade official has renewed efforts to deepen economic relations with Taiwan in a meeting with her Taiwanese counterpart, as Joe Biden began his first visit to Asia since taking office amid increasing competition with China.

In a statement on Friday, the office of US Trade Representative Katherine Tai said she met with with Taiwan’s lead trade negotiator John Deng in Bangkok ahead of the Asia-Pacific Economic Cooperation (APEC) ministerial meeting.

“Ambassador Tai and Minister Deng directed their teams to explore concrete ways to deepen the US-Taiwan trade and investment relationship and to meet again in the coming weeks to discuss the path forward,” it said.

Such high-level meetings can increase tensions between the US and China, which claims self-ruled Taiwan as part of its territory and is against any official exchanges between Taiwan’s government and other foreign governments.

Relations between Washington and Beijing have been strained in recent months, particularly over China’s neutral public position on the war in Ukraine.

US President Joe Biden has warned his Chinese counterpart Xi Jinping of “consequences” should China provide any support to Russia in its invasion, and senior members of the Biden administration have urged Beijing to exert pressure on Moscow to end the war.

Last month, China also denounced a visit by a group of US legislators to Taipei, saying it was “deliberately provocative” and had “led to further escalation of tension in the Taiwan Strait”.

Six US legislators, including Republican Senator Lindsey Graham and Democratic Senator Bob Menendez, who chairs the Senate Foreign Relations Committee, met Taiwan President Tsai Ing-wen on that trip.

“With Taiwan producing 90 percent of the world’s high-end semiconductor products, it is a country of global significance, consequence and impact, and therefore it should be understood the security of Taiwan has a global impact,” Menendez told Tsai at that time.

The Biden administration has been trying to demonstrate that Washington remains focused on the Asia-Pacific as Beijing becomes an increasingly powerful player in the region.

Last week, Biden hosted a two-day summit with the 10-nation Association of Southeast Asian Nations (ASEAN) at the White House, pledging $150m on infrastructure, security and anti-pandemic efforts in the region.

On Friday, the US president began his first visit to Asia in South Korea, meeting the country’s newly sworn-in President Yoon Suk-yeol for the first time in person.

Biden said the future would be written in the region and now was the time for the US and like-minded partners to invest in each other.

“With today’s visit, I hope that Korea-US relations will be reborn as an economic and security alliance based on high-tech and supply chain cooperation,” said Yoon, urging Biden to provide incentives for South Korean and US businesses to invest in each other’s countries.



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Russia to cut gas supplies to Finland on Saturday: Gasum | Russia-Ukraine war News

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Finnish state-owned gas company says Russian cutoff, which follows application to join NATO, will not affect supply.

Russia will cut flows of natural gas to Finland on Saturday, Finnish state-owned energy wholesaler Gasum has said.

Gasum said on Friday that it had been informed by Russia’s state-owned energy corporation Gazprom that flows would be halted.

The Finnish company said the move by Russia would not cause disruptions in supplies.

The gas cutoff – which is scheduled to take place at 04:00 GMT on Saturday – comes in the wake of Finland and Sweden applying to join the NATO military alliance amid security concerns spurred by the Russian invasion of Ukraine.

“It is highly regrettable that natural gas supplies under our supply contract will now be halted,” Gasum CEO Mika Wiljanen said in a statement.

“However, we have been carefully preparing for this situation and provided that there will be no disruptions in the gas transmission network, we will be able to supply all our customers with gas in the coming months,” he said.

Payments for Russian gas have become an issue since Moscow demanded that foreign buyers start paying for supplies in roubles, and Russia cut supplies to Poland and Bulgaria for refusing to do so.

Gazprom Export demanded in April that future payments in the supply contract to Finland be made in roubles instead of euros, but Gasum rejected the demand and announced on Tuesday it was taking the issue to arbitration.

 

Gasum said it will continue to provide Finnish customers with natural gas through the Balticconnector pipeline that connects Finland with Estonia.

Earlier on Friday, Finland announced a 10-year agreement with US-based Excelerate Energy to lease a floating storage and delivery vessel to provide liquefied natural gas to the region.

While the majority of gas used in Finland comes from Russia, the fossil fuel only accounts for between five to eight percent of the country’s annual energy consumption.

‘Far-reaching consequences’

Gazprom did not immediately comment on the cutting of gas supplies to Finland, but Kremlin spokesman Dmitry Peskov said that while Moscow did not have detailed information regarding Gazprom’s supply contracts, “obviously nothing will be supplied to anyone for free”.

On Sunday, RAO Nordic, a subsidiary of Russian state energy holding Inter RAO, cut off electricity supply to Fingrid, Finland’s electricity grid operator, citing concerns over payment. Fingrid said the reduced power supply would be compensated for with increased domestic output and imports from Sweden.

Finland and Sweden on Thursday broke their historic policies of neutrality and officially applied to join NATO, although their joint application will need to overcome opposition from Turkey.

Moscow has repeatedly warned Finland, which shares a 1,340km (830 mile) border with Russia, of “far-reaching consequences” in response to its bid to join the military bloc.

Russian defence minister Sergei Shoigu announced on Friday that Moscow would establish 12 new military units and divisions in the western region of the country, citing the possible expansion of NATO and other emerging military threats.



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