CARACAS, August 27 -- Venezuela's National Assembly (parliament) controlled by the opposition has declared null and void a new agreement with Russia on military cooperation. The declaration was published on Monday.
The document concerns "the agreement on military cooperation between the governments of Venezuela and Russia, signed by defense ministers Vladimir Padrino Lopez and Sergey Shoigu." "This agreement was not considered either by a commission on foreign policy, sovereignty and integration or by parliament, which makes it unconstitutional, and this means that it is null and void," the declaration said. The parliament said that opening a Venezuelan embassy in North Korea was "a violation of the constitution." On August 15, Shoigu and Lopez signed an agreement on reciprocal visits of military ships at the meeting in Moscow. The defense ministers also discussed the situation in Venezuela and issues of bilateral military cooperation.
BANGKOK, August 26 -- The government has banned hoarding of glutinous rice and will sell discounted packs as prices soar amid shortages.
Government spokesperson Narumon Pinyosinwat said on Monday that Prime Minister Prayut Chan-o-cha had ordered the Commerce Ministry to prevent hoarding and to launch discounted packs in the wake of the all-time high price of glutinous rice. Deputy Prime Minister and Commerce Minister Jurin Laksanawisit ordered the Internal Trade Department to impose the ban immediately since the grain is on the ministry's price control list, Mrs Narumon said. "There will be discussions with millers, traders and cooperatives so they can quickly produce packed glutinous rice at a special price to relieve people's trouble," she said. Mrs Narumon attributed the expensive glutinous rice to drought that caused its low yield. The situation should improve when the new yield comes out in October, she said. Glutinous rice now sells for 50,000 baht a tonne while Hom Mali fragrant rice costs 35,000 baht. Local retail prices were nearly 50 baht per kilogram and a smallest bag of steamed glutinous rice is now 10 baht, double recent prices.
BIARRITZ, August 26 -- World leaders at the G-7 summit have agreed to help the countries affected by the huge wildfires ravaging the Amazon rain forest as soon as possible, French President Emmanuel Macron said on Sunday.
"We are all agreed on helping those countries which have been hit by the fires as fast as possible," he told journalists at the summit in the south-western French resort of Biarritz. Ahead of the gathering, Macron called on world leaders to hold urgent talks on the wildfires ripping through the world's largest rain forest, pledging "concrete measures" to tackle it. Although about 60 per cent of the Amazon is in Brazil, the vast forest also takes in parts of eight other countries: Bolivia, Colombia, Ecuador, French Guiana, Guyana, Peru, Suriname and Venezuela. "This morning, Colombia called on the international community (to help), so we must help out," he said. "Our teams are making contact with all the Amazon countries so we can finalise some very concrete commitments involving technical resources and funding." Macron's bid to put the Amazon crisis high on the agenda at the G-7 angered Brazil's far-right leader Jair Bolsonaro, who lashed out over what he sees as outside interference, denouncing the French leader's "colonialist mentality". Under intense international pressure, Bolsonaro agreed to send in the military to fight the fires. The army on Sunday deployed two Hercules C-130 aircraft to douse fires, as hundreds of new blazes were ignited ahead of nationwide protests over the destruction.
Heavy smoke covered the city of Porto Velho in the north-western state of Rondonia where the defense ministry said the planes have started dumping thousands of liters of water. Swathes of the remote region bordering Bolivia have been scorched by the blazes, sending thick smoke billowing into the sky and increasing air pollution across the world's largest rain forest. Experts say increased land clearing during the months-long dry season to make way for crops or grazing has aggravated the problem this year. "It gets worse every year - this year, the smoke has been really serious," Deliana Amorim, 46, told Agence France-Presse in Porto Velho where half a million people live. At least seven states, including Rondonia, have requested the army's help in the Amazon, where more than 43,000 troops are based and available to combat fires, officials said. Pope Francis on Sunday also voiced concern for the rain forest, which he described as a "vital" lung for the planet. The latest official figures show 79,513 forest fires have been recorded in Brazil this year, the highest number of any year since 2013. More than half of the fires are in the massive Amazon basin, where more than 20 million people live. Some 1,130 new fires were ignited between Friday and Saturday, according to Brazil's National Institute for Space Research (INPE). The new data come as protesters plan to take to the streets across Brazil on Sunday, after thousands held demonstrations in the country and in Europe on Friday.
BIARRITZ, August 26 -- G-7 leaders discussed the return to the G-8 format with Russia's participation at a summitin the French city of Biarritz, Kyodo news agency reported, citing sources from Japanese government circles.
No details were provided about the content of the interview, and an agency source said the information "will never be disclosed". Earlier, US President Donald Trump agreed to a proposal by his French counterpart, Emmanuel Macron, to invite Russia to the G7 summit in 2020 in the US. Vladimir Putin, for his part, said that Russia considered all contacts with the G7 countries useful and did not rule out the resumption of the G8 form. German Chancellor Angela Merkel linked the issue of the resumption of the G-8 with progress in resolving the conflict in Ukraine. The G-7 is an association of economically developed countries that includes the United Kingdom, Germany, Italy, Canada, the United States, France and Japan. In the form of the seven, the club has existed from 1976 to 1997. After Russia's accession, it became known as the G8
HONG KONG, August 26 -- Hong Kong stocks dived more than 3 per cent in the first few minutes of business on Monday.
Caused by United States President Donald Trump ramped up his trade row with China and the city was hit by fresh violent protests over the weekend. The Hang Seng Index plummeted 3.27 per cent, or 857.33 points, to 25,322 at the open. The benchmark Shanghai Composite Index sank 1.6 per cent, or 46.41 points, to 2,851.02, and the Shenzhen Composite Index, which tracks stocks on China's second exchange, shed 1.96 per cent, or 30.87 points, to 1,547.83.
SHANGHAI, August 26 -- China's currency on Monday (Aug 26) slid to its lowest point in more than 11 years as concerns over the US trade war and the potential for global recession weighed on markets.
The onshore yuan fell to 7.1487 to the US dollar, its weakest point since early 2008, in Asian trading. Global economic tensions have intensified in recent days with the US and China raising tariffs on each other's imports, and President Donald Trump calling on US businesses to pull out of China. The yuan is not freely convertible and the Chinese government limits its movement against the dollar to a two percent range on either side of a figure that the central bank sets each day to reflect market trends and control volatility. The People's Bank of China has set that rate steadily weaker in recent weeks and set it on Monday at 7.057 to the dollar. Allowing the yuan to depreciate makes Chinese exports cheaper and offsets some of the burden of punitive US tariffs. The yuan breached the key 7.0 threshold against the dollar earlier in August, days after the US announced plans to impose fresh tariffs on Chinese imports from September 1.
HONG KONG, August 26 -- China sent the strongest warning yet of using troops on Hong Kong's streets, where Beijing says protests have turned into a "Colour Revolution", with water cannons and tear gas fired in skirmishes between police and demonstrators in the 12th straight weekend of unrest.
"It's not only the China central government's authority but also its responsibility to intervene when riots take place in Hong Kong," the state-run Xinhua News Agency said on Sunday (Aug 25) in a commentary, recalling comments by former top leader Deng Xiaoping that Beijing has to act under such circumstances. United States President Donald Trump said on Aug 13 that reports from US intelligence agencies show the Chinese government is moving troops to its border with Hong Kong. A day earlier, Global Times, a Chinese tabloid run by the People's Daily, reported that the Chinese People's Armed Police were assembling in Shenzhen ahead of "apparent large-scale exercises", where "numerous" armoured personnel carriers, trucks and other vehicles of the paramilitary force were seen heading towards Hong Kong's neighbouring city. In Sunday's commentary, Xinhua said Hong Kong's protests have turned into a Colour Revolution aimed at overturning the Special Administrative Region's constitutional institutions, a signal it was ready to take further action. Previously, Chinese officials described the protests as having some characteristics of a "Colour Revolution". Protesters' violent acts have pushed Hong Kong to an extremely dangerous edge, the city's government said in a statement after a day full of violent clashes between demonstrators and the police, where an officer fired warning shots in the air.
The U.S. administration of President Donald Trump has renewed sanctions on Iran after quitting Tehran's deal with Britain, China, France, Germany, Russia and the United States, which promised sanctions relief in exchange for curbs on its nuclear program. "Iran's active diplomacy in pursuit of constructive engagement continues," Zarif tweeted. "Road ahead is difficult. But worth trying." The minister departed on a government plane for Iran on Sunday evening. A source at the French presidential office said practical discussions at the G-7 summit led to Zarif's visit to Biarritz, which the United States had acknowledged. Macron is said to have personally contacted Trump.
G-7 leaders shared the view Saturday that Iran should not possess nuclear weapons, but differed in their approach to finding a solution. With U.S.-Iran tensions escalating, France, which has expressed hope the nuclear agreement will survive, has apparently been trying to mediate between Washington and Tehran, foreign affairs experts say. Zarif was already in France, having met with Macron in Paris on Friday.
HONG KONG, August 25 -- Protesters left the northern district of Tsuen Wan, where police had earlier deployed two water cannon, at first during dispersal operations, regrouping in the working class district of Sham Shui Po on Sunday night.
Amid heavy rain, scores of protesters with umbrellas shouting "hak seh wui", or "triads", at riot police gathered to disperse the crowd. Earlier, police deployed two vehicles equipped with water cannons on the streets of Tsuen Wan, a town in the New Territories area close to the Chinese border. The vehicles slowly cruised down streets and directed their water cannons at makeshift barricades as police cleared roads after protesters retreated southward, and most had dispersed by about 7.30pm (local time). This came as multiple rounds of tear gas were fired to clear protesters, following an approved protest march earlier in the day. But as protesters dispersed, a splinter group targeted several shops in Yi Pei Square in Tsuen Wan, the site of clashes between pro-democracy protesters and government supporters, trashing several shops including a restaurant and a mahjong parlour. Shortly after 8pm, at least three officers drew their service revolvers on a group of protesters who had attacked them, resulting in a standoff at a nearby building with reporters unhappy that a gun had been pointed at them. Riot police were brought to reinforce the officers. A uniformed officer had fired a warning shot during the encounter, a senior police officer told journalists at the scene but did not go into further details citing the need for further investigation.
Earlier in the day, groups of demonstrators occupied the streets in Tsuen Wan with barricades made of dismantled roadside fences, bamboo poles, water-filled barriers, traffic cones and dustbins near Tsuen Wan Park, the official end point of the march that started at Kwai Chung Sports Ground. One water-cannon vehicle was used to clear the barricades on Tai Ho Road, which was not occupied by protesters, according to local TV footage. In a statement, police said the situation in Tsuen Wan had escalated, with protesters hurling bricks and aiming strong laser beams at officers. The police appealed to people in the area to leave immediately.
ROTTERDAM, August 25 -- Eleven years after the global financial crisis, the European banking industry is once again preparing for tough days ahead.
After Deutsche Bank announced a large-scale layoff plan not long ago, another large European bank might follow suit to do the same. Italy’s largest bank by asset size UniCredit is considering 10,000 job cuts, accounting for 10% of the bank’s total global workforce. This layoff makes up part of the business plan that UniCredit will announce at the end of this year. UniCredit will announce at least 9,000 layoffs, and almost all the employees getting retrenched will be Italians. The negotiations between UniCredit and the union will begin after the announcement of its business plan for 2020-2023 on December 3 this year. The negotiations between both parties may help to reduce the number of layoffs from the original figures.
UniCredit is a European bank headquartered in Milan, with operations in 19 countries and having more than 28 million customers. It is also one of the largest banking groups in Europe. The core business of UniCredit is mainly distributed in the more well-off regions of Italy, Austria and southern Germany, as well as a large number of businesses in Central and Eastern Europe. With assets of EUR 91 billion, UniCredit has become the largest bank in the Eurozone, the third largest in Europe and the sixth largest in the world. However, its profitability is in decline. According to publicly-accessible information, UniCredit’s net profit for 2018 was EUR 3.892 billion, a decline of nearly 29% compared to a net profit of EUR 5.473 billion in 2017.
The recent frequent layoffs could be a possible indication that the European banking industry has not fully recovered from the financial crisis. After the crisis, the United States adopted quantitative and accommodative monetary and fiscal policies as guarantees, and through legislation to strengthen supervision of the banking industry. At the same time, the government helped the banks through the crisis by using national capital injection. The period of de-leveraging the banking industry is relatively short, and the profitability of the U.S. banking industry therefore recovered within a shorter span of time.
In Europe, there was a lack of a unified fiscal policy. It was only in November 2014 that the single regulatory mechanism for the banking sector in the euro zone was launched. The de-leverage of the European banking industry lacked sufficient policy support and assistance, hence slowing its process of deleveraging. Since the total loans of 27 banks in Europe account for a much higher proportion of non-financial debt than the United States, the impact on the economy in its de-leveraging process was much greater, which in turn affected its profitability.
On a more general level, the poor performance of the European banking industry stemmed from the slow recovery of the European economy and the tightening of banking regulations. Data from the World Bank reveals that from 2010 to 2017, the world’s GDP increased from US$ 65.96 trillion to US$ 80.73 trillion, representing an increase of 22.39%. Among them, the U.S. GDP increased from US$ 14.96 trillion to US$ 19.39 trillion, an increase of 29.61%. However, the EU’s GDP only increased from US$ 16.98 trillion to US$ 17.28 trillion, a mere 1.76% increase and far less than that of the United States. The economic growth of the EU is not only significantly lower than the global average, but also significantly lower than the United States.
The reason why European banking performance is closely related to its economy is because European banks, especially small and medium-sized banks, are not highly globalized, and their business is mainly located in Europe. Only a few larger banks, such as Deutsche Bank, have branches around the world that provide services to customers globally. As the global trade frictions intensify and the downward pressure on the economy increases, the profits of these large banks are being affected. Small and medium-sized banks whose businesses are mainly concentrated in Europe will see difficulty in achieving improvement.
After the financial crisis, especially since the European debt crisis, the strength of regulation in Europe has been increasing. The European debt crisis has exposed two major problems of the European banking industry. Banks conducting higher-risk businesses and the general EU financial system were under-regulated. To resolve this, the EU on the one hand has increased the banking capital adequacy requirements, prohibiting large banks from engaging in proprietary trading, and curbing excessive speculation in the banking industry. On the other hand, it established a banking industry alliance to form a unified regulatory mechanism, clearing mechanism and deposit insurance system. However, EU member states have major differences in the relevant new banking regulations. The increase in capital adequacy ratio and the divestiture of risky assets have augmented the stability of the banking industry. At the same time, it also led to a decline in the income and profit of the banking industry.
Kevin Dowd, a professor of finance and economics at Durham University, has previously analyzed that the large European banks have suffered setbacks in the United States, and also contraction of their business activities. However, a careful analysis will reveal that the main problem in the EU banking industry is happening in European soil. The European banking industry is facing a major repayment crisis, and this crisis has been brewing for a long time. The thorny issue facing the European banking industry is caused by none other than the EU itself.
Due to quantitative easing policies and excessive tolerance policies, the existing problems have worsened. Dowd believes that the EU banking industry is currently moving in the direction towards a crisis, and the EU bank’s bad debt loaning solution will fail to work. In the end, there will be the scenario where the taxpayers will have to bailout the banking industry who will then become too big to fail. It is worth noting that both Deutsche Bank and UniCredit are regarded as banks with high importance in the global financial system. If these banks are having problems, they will inevitably hold a major impact over the European financial system. In particular, the European economy has not recovered from the crisis so far. With the global trade war resulting in economic slowdown, the European Central Bank has clearly stated that in order to support economic growth, it may further introduce easing policies and even cut interest rates further.
Long-term negative interest rates have seriously affected the profitability of the European banking industry, and should the interest rates fall further, the impact on these banks will be even greater. As these banks get into trouble, they will also affect the lending behavior of enterprises, which will in turn drag down the growth of the entire European economy and thus turning these events into a vicious cycle. If this shock continues to expand, it may trigger a new round of global economic crisis.
Final analysis conclusion: The recent frequent layoffs in the European banking industry have highlighted its vulnerability in the post-crisis era, and in the context of global trade war and economic slowdown, this vulnerability may eventually evolve into a trigger for a new global economic crisis.