By The Washington Post · Mustafa Salim, Louisa Loveluck
BAGHDAD – A U.S. contractor died during rocket attacks on an Iraqi military base Wednesday, the Pentagon said, posing a fresh challenge to the Biden administration days after it launched military action in retaliation for an earlier attack.
Iraq’s military said that 10 Grad rockets had landed on the Ain al-Asad air base in the western province of Anbar, and that the vehicle they were launched from had also been located. Around half of the rockets were intercepted by a U.S. aerial defense system, American and Iraqi officials said.
“A U.S. civilian contractor suffered a cardiac episode while sheltering and sadly passed away shortly after,” said Pentagon spokesman John Kirby, sharing no further information about the person’s identity. “There are no current reports of U.S. service member injuries, and all are accounted for.”
The attack came during an acutely sensitive period for the President Joe Biden and the Iraqi government. While similar rocket attacks have routinely been claimed by or blamed on Iran-backed militia groups, Washington is trying to blunt the tensions that soared between Washington and Tehran during President Donald Trump’s years in office.
Biden said Wednesday: “We are following that through right now. Thank God no one was killed by the rocket. One individual, a contractor, died of a heart attack. But we’re identifying who’s responsible, and we’ll make judgments from that point.”
Western officials point to Biden’s response to rocket attacks on U.S. service personnel in Iraq last week as a case in point. Although the strikes resulted in the first unilateral military action of Biden’s presidency, the Iran-backed militants it targeted were across the border in Syria, not Iraq, a move that seemed consciously calibrated to avoid further escalation.
In Baghdad, meanwhile, officials have all hands on deck for the arrival of Pope Francis on Friday, with the pontif’s visit representing an opportunity for the embattled government here to showcase Iraq’s relative stability in the wake of the Islamic State’s military defeat.
“Iraqi security forces are on scene and investigating. We cannot attribute responsibility at this time, and we do not have a complete picture of the extent of the damage,” Kirby said in a statement. “We stand by as needed to assist our Iraqi partners as they investigate.”
Rocket attacks on U.S. diplomatic and military targets have escalated in the year since Trump ordered the killing of Iran’s most influential military strategist, Maj. Gen. Qasem Soleimani, and the Iraqi militia leader, Abu Mahdi al-Muhandis, responsible for maintaining cohesion among the country’s disparate network of militia groups.
Recent attacks on U.S.-linked bases have been claimed by splinter groups that have announced themselves since the deaths of Soleimani and Muhandis. Although U.S. officials say that those groups are backed by Iran, the extent of Tehran’s control over individual attacks remains unclear.
As night fell Wednesday, there was no claim of responsibility for the latest rocket attacks.
Asia rebuffs U.S. sanctions on Myanmar, giving generals lifeline
InternationalMar 04. 2021A demonstrator wears a National League for Democracy (NLD) party themed protective mask during a protest outside the Embassy of Myanmar in Bangkok, Thailand, on Feb. 1 2021. MUST CREDIT: Bloomberg photo by Andre Malerba.
By Syndication Washington Post, Bloomberg · Philip J. Heijmans
As the U.S. looks to build a coalition to further punish Myanmar’s generals, it is not having much success convincing governments in Asia to follow suit.
The standing of army chief Min Aung Hlaing’s regime has slipped even further in the West after his envoy to the United Nations denounced the military takeover and Myanmar authorities killed at least 18 protesters on Sunday, the deadliest day since the Feb. 1 coup. While the junta has since told security forces to avoid using live bullets, reports emerged that protesters were still being shot with them. At least two more were killed on Wednesday in the city of Mandalay.
The U.S. has led the international pushback, with National Security Advisor Jake Sullivan saying the country was “coordinating closely with allies and partners in the Indo-Pacific region” and would take additional actions after imposing targeted sanctions on the coup makers. The U.K. also sanctioned the generals and the European Union has said its working on punitive measures.
Asian countries, by contrast, haven’t taken any concrete action. While Indonesia has conducted shuttle diplomacy and Singapore has said its “appalled by the violence,” no countries in the region so far have indicated they would support sanctions or any other measures that would hit the military’s finances.
On Tuesday, foreign ministers of the 10-member Association of Southeast Asian Nations, which includes Myanmar, called “on all parties to refrain from instigating further violence” and for “a peaceful solution through constructive dialogue.” While some individual ministers called for the release of Aung San Suu Kyi and a return to democracy, the statement didn’t mention her by name and refrained from using the word “coup.” It also said Asean, which is based on the principle of nonintervention, was ready “to assist Myanmar in a positive, peaceful and constructive manner.”
Singapore Prime Minister Lee Hsien Loong separately said sanctions would only hurt the population at large and push Myanmar closer to those willing to talk to them like China.
“You can ostracize them, condemn them, and pass resolutions or not, but it really has very little influence,” Lee told the BBC, according to comments distributed by his office. “We have to express disapproval for what is done, which is against the values of many other countries, and in fact a large part of humanity. But to say that I will take action against them, where does this lead?”
For Myanmar’s generals, Asia’s reluctance to join in U.S.-led sanctions or even cut them out of meetings effectively offers a diplomatic lifeline as they struggle to gain control of the country. Prior to Myanmar’s opening about a decade ago, business ties with Asia allowed the junta to survive for years despite much broader Western sanctions than are currently in place.
“Asean has an unmatched track record of indifference to authoritarian rule in Myanmar,” said Lee Morgenbesser, a lecturer at Australia’s Griffith University whose researches Southeast Asian politics.
Among Southeast Asia’s 10 countries, two are run by military men who staged coups, two are Communist regimes with no elections, two have had ruling parties in power for more than two decades and one is an absolute monarchy. Malaysia, Indonesia and the Philippines are the only democracies that have seen peaceful transfers of power from one party to another in recent years.
Countries in Asia also avoided sanctioning Myanmar’s generals over allegations of genocide against the Muslim Rohingya minority that forced more than 700,000 people to flee across the border into Bangladesh. An independent UN fact-finding mission found in 2019 that at least 59 foreign firms — most from Asia — had either joint ventures or commercial ties with the military, producing revenue that “substantially enhances its ability to carry out gross violations of human rights with impunity.”
“In some ways, Asean allowed the military to get away with what happened with the Rohingya crisis and I think that they are faced with something more dangerous,” said Bridget Welsh, honorary research associate at the Asia Research Institute, University of Nottingham Malaysia. “This is going to be much more difficult for them to wrestle with.”
Myanmar’s generals have made clear they have no intention of returning the nation to isolation, vowing to hold elections after a yearlong state of emergency. The junta has appointed Aung Naing Oo — a familiar face to foreign investors — as investment minister.
China and Thailand alone accounted for about half of Myanmar’s trade in 2019, the latest year for which data is available, with the U.S. and Europe comprising roughly 13%. Asian economies represented seven of Myanmar’s top 10 foreign investors as of January, led by China and Singapore, according to data from the Directorate of Investment and Company Administration.
Vietnam’s Viettel Group, a state-owned enterprise operated by the Ministry of Defense, announced in 2018 that it was investing $1.5 billion to set up the mobile operator Mytel. Thailand’s state-owned PTT, meanwhile, has imported natural gas from Myanmar for years via the Gulf of Martaban, and its exploration arm said last month it didn’t expect the political situation to impact its operations or plans in the country.
Asean should take a clear stand particularly on avoiding more civilian casualties, according to Ong Keng Yong, a former secretary-general of the bloc. He likened Myanmar to a neighbor who infringes on the rights of nearby home owners.
“You can rearrange the furniture and setup in your home,” he said. “But if that involves more use of scarce electricity and water resources, the others in the gated compound can have a say.”
Samsung details plans for $17 billion chip facility in U.S.
InternationalMar 04. 2021The Samsung Electronics logo is displayed in a window at the company’s D’light flagship store in Seoul, South Korea, on Oct. 6, 2020. MUST CREDIT: Bloomberg photo by SeongJoon Cho.
By Syndication Washington Post, Bloomberg · Sohee Kim
Samsung Electronics Co. revealed additional details about its plans to build a cutting-edge semiconductor facility in the U.S. in a filing with the state of Texas, making the disclosure as the Biden administration vows to make the security of the U.S. chip supply a national priority.
The South Korean company plans to invest about $17 billion in its Project Silicon Silver and create about 1,800 jobs over the first ten years, according to an economic impact study prepared by a local consultant. Some $5.1 billion would go into buildings and property improvements, while $9.9 billion would be spent on machinery and equipment.
The filing with the Texas comptroller warned the chips project is “highly competitive.” Samsung is evaluating alternatives sites in Arizona and New York, as well as in Korea.
“Because of its strong ties to the local community and the successful past 25 years of manufacturing in Texas, Samsung Austin Semiconductor would like to continue to invest in the city and the state,” the study said.
In their first weeks in office, the Biden administration has emphasized the importance of advanced technologies, including semiconductors, artificial intelligence and next-generation networks. The president has ordered a global supply chain review for microchips as well as large-capacity batteries, pharmaceuticals and critical minerals and strategic materials such as rare earths.
Bloomberg News first reported in January that Samsung was considering building an advanced chipmaking plant in the U.S., in hopes of winning more American clients and narrowing the gap with industry leader Taiwan Semiconductor Manufacturing Co. The company was in discussions to locate a facility in Austin, Texas, capable of fabricating chips as advanced as 3 nanometers, people familiar with the matter said at the time.
Details of Samsung’s discussions with local governments have since leaked out in filings and other revelations. The economic impact study was prepared by Impact DataSource, an Austin, Texas-based economic consulting, research and analysis firm.
The report shows Samsung’s Project Silicon Silver would add approximately 7 million square feet of new space to the Austin campus, where the company has had operations for decades. It estimates that 542 new workers would move to the city, contributing to an addition of 1,626 new residents.
Property tax abatements would total about $1.5 billion over 20 years at the city and county levels, while direct and indirect economic output would be about $8.6 billion and salaries would total $7.3 billion.
A January filing detailed the likely timeline for the project. If Samsung chooses Austin, it would break ground in the second quarter of 2021 with the expectation that production would be up and running by the fourth quarter of 2023, it said.
Separately, Samsung’s current foundry plant in Austin hasn’t resumed operations since Feb. 16 after it was ordered to halt operations by Austin Energy due to blackouts in the region. Power and water are back but it will take more time to fully restart operations, officials said.
WASHINGTON – President Biden has agreed to narrow eligibility for a new round of $1,400 stimulus payments in his $1.9 trillion coronavirus relief bill, a concession to moderate Senate Democrats as party leaders moved Wednesday to lock down support and finalize the sweeping legislation.
Under the new structure, the checks would phase out faster for those at higher income levels, compared to the way the direct payments were structured in Biden’s initial proposal and the version of the bill passed by the House on Saturday.
The change came as the Senate prepared to take an initial procedural vote to move forward on the bill as early as Thursday. Biden and Senate Democratic leaders were scrambling to keep their caucus united since they cannot lose a single Democrat in the 50-50 Senate if Republicans unite against the legislation.
In addition to the stimulus checks, the sweeping economic package would also extend unemployment benefits through August, as well as set aside $350 billion for state and local aide; $130 billion for schools; $160 billion for vaccinations, testing and other health care system support; increased the child tax credit; and spend billions more on a variety of other provisions including rental aid and food assistance.
Biden made a closing pitch for the package to House Democrats on Wednesday evening, citing public polling in favor of the measure and telling them: “I know parts of this and everything else we seek to do are not easy, but people are going to remember how we showed up in this moment, how we listened to them . . . and how we took action.”
At least one Senate Republican, Lisa Murkowksi of Alaska, appeared open to considering a vote in favor of the legislation, telling reporters, “My state needs relief.” Elsewhere, though, GOP opposition was hardening, as Sen. Ron Johnson, R-Wis., announced plans to force Senate officials to read the entire 600-page-plus bill aloud before debate could even begin — a process he predicted would take around 10 hours.
“I don’t want to sound like a leftist, but I’m gonna resist,” Johnson told a talk radio host in Wisconsin.
The action in the Senate was unfolding against a backdrop of tightened security around the Capitol complex, as the sergeant-at-arms and the Capitol Police warned of potential violent unrest over the coming days. The House moved up votes to allow members to avoid the Capitol on Thursday, the day some conspiracy theorists have identified as when former president Donald Trump should rightfully be inaugurated. The Senate is scheduled to remain at work.
Under the plan for stimulus checks passed by the House, individuals earning up to $75,000 per year and couples making up to $150,000 per year would qualify for the full $1,400 payment. The size of the payments would then begin to scale down before zeroing out for individuals making $100,000 per year and couples making $200,000.
Under the changes agreed to by Biden and Senate Democratic leadership, individuals earning $75,000 per year and couples earning $150,000 would still receive the full $1,400-per-person benefit. However, the benefit would disappear for individuals earning more than $80,000 annually and couples earning more than $160,000.
That means singles making between $80,000 and $100,000 and couples earning between $160,000 and $200,000 would be newly excluded from seeing any benefit under the revised structure Biden agreed to.
The changes were confirmed by a Democratic aide who spoke on the condition of anonymity to describe internal deliberations.
White House press secretary Jen Psaki said Biden has always been open to a faster phaseout for higher-earning individuals and “he is comfortable with where the negotiations stand.”
“He is comfortable and knows there will be tweaks on the margin,” Psaki said Wednesday’s White House briefing. “What his firm viewpoint is, is that it needs to meet the scope of the challenge, it needs to be the size he’s proposed, it needs to have the core components in order to have the impact on the American people.”
Sen. Jeanne Shaheen, D-N.H., was among those who had called for changing the eligibility levels for checks, telling reporters this week, “I think we could drop it below the $200,000 and still get households that really need it.”
She said she would hope to redirect the savings from that change toward other needs, such as hospitals.
Narrowing eligibility for the stimulus checks was just one change moderates like Sens. Shaheen and Joe Manchin, W.Va., had been seeking. Several were also eyeing better targeting money for state and local governments, and changing the structure of weekly federal unemployment benefits in the bill, to keep them at the current level of $300 rather than raise them to $400 as proposed by Biden and passed by the House.
Senate Democrats do not intend to adopt the suggested change to unemployment benefits, and they will stay at $400-per-week, the aide said. The unemployment benefits currently are set to expire March 14; the Biden bill would extend them through August. Democrats are aiming for final passage of the bill ahead of the March 14 deadline.
About 12 million fewer adults and 5 million fewer children would get the stimulus payments under the new Biden-Senate compromise, according to preliminary estimates from the Institute on Taxation and Economic Policy, a left-leaning think tank. About 280 million Americans in total – 200 million adults and 80 million children – would be eligible for the checks under the new structure.
Centrist Senate Democrats initially had pushed for even more aggressive restrictions on the stimulus payments. Senior Democratic officials had at one point considered dropping the full benefit for those making more than $50,000 per year, a change they ultimately abandoned after a backlash led by Senate Finance Chair Ron Wyden, D-Ore., and Senate Budget Chair Bernie Sanders, I-Vt.
Still, liberal lawmakers bristled at the new changes. House liberals have suggested it could be difficult for them to approve the package if it’s watered down significantly in the Senate. Presuming the Senate passes the package this week, it would still have to go back to the House for final approval.
“I don’t understand the political or economic wisdom in allowing Trump to give more people relief checks than a Democratic administration,” Rep. Alexandria Ocasio-Cortez, D-N.Y., said in a statement. “People went far too long without relief last year – if anything we should be more generous, not more stingy. It’s also an insensitive compromise for the roughly 80 percent of Americans that live in urban areas, which are known for higher costs of living.”
Biden acknowledged in his comments to House Democrats that “I know we’re all making some small compromises,” but he said staying united to pass the relief bill, his first major piece of legislation, would help restore the public’s faith in government and open the door to further successes.
“It’s a show of strength,” Biden said. “We know how much we have to do, but it all starts here, it starts by bringing this home.”
On a portion of his call with House Democrats that was not public, Biden told Rep. Suzan DelBene, D-Wash., that he supports legislation that would permanently increase the child tax credit to $3,000 per child, according to two people on the call who spoke on the condition of anonymity to share details of the conversation. The legislation as currently written would do so for one year.
Senate moderates were discussing further changes and GOP senators also were preparing amendments aimed at further targeting the legislation, which could peel off Democratic votes as the legislation moves through the Senate.
Democrats are advancing the package under a process called “budget reconciliation” that allows it to pass with a simple majority instead of the 60 votes normally required. With only 50 votes in the Senate and GOP support uncertain, Democrats must ensure they remain united to pass the legislation with Vice President Kamala Harris breaking the tie.
Attention has focused on Senate moderates who have voiced skepticism about various elements of the bill. Psaki expressed optimism Wednesday that Democratic moderates such as Manchin would support the bill.
ECB downplays yield concerns, signaling no drastic action needed
InternationalMar 04. 2021Flags of the European Union (EU) fly outside the European Central Bank (ECB) headquarters in Frankfurt, Germany, on July 16, 2020. MUST CREDIT: Bloomberg photo by Alex Kraus.
By Syndication Washington Post, Bloomberg · Carolynn Look, Alexander Weber, Jana Randow
European Central Bank policymakers are downplaying concerns over rising bond yields, suggesting they can manage the risk to the euro-area economy with verbal interventions including a pledge to accelerate bond-buying if needed.
ECB Governing Council members, who meet next week to set policy, see no need for drastic action such as expanding the overall size of their 1.85 trillion-euro ($2.24 trillion) emergency asset-purchase program, according to officials familiar with internal discussions.
The officials didn’t say whether the pace of purchases has been stepped up in recent days, for which data isn’t yet available. One person noted that yields fell on Monday after some policy makers said the institution would react against unwarranted increases. An ECB spokesman declined to comment.
The relatively sanguine mood was backed up on Wednesday by Governing Council members including ECB Vice President Luis De Guindos and Bundesbank President Jens Weidmann, who said in public remarks that they’re not too worried.
European yields rose, led by the longest-dated debt. The rate on German 10-year bonds climbed as much as seven basis points to minus 0.28%. The euro was down 0.2% at $1.2073 at 5:20 p.m. Frankfurt time.
The global sell-off of government bonds originates from the U.S., where prospects of massive fiscal stimulus are bolstering the economy and lifting inflation expectations.
In Europe, Greek and Italian 10-year yields led the charge, climbing about 20 basis points in the past two weeks. Benchmark German yields touched levels last seen in March 2020, and those for their French equivalents briefly turned positive for the first time since June.
That’s a problem for the euro area because sovereign yields are used by banks as a reference point for lending. The region’s recovery is already expected to be slower than that of many other advanced economies, in part due to its slow vaccine roll-out, and higher borrowing costs could further damp momentum.
Policymakers have been rolling out public appearances before their weeklong quiet period starts this Thursday. Guindos said yields have risen from very low levels and “the situation is very calm” when looking at spreads between different nations. Weidmann told Bloomberg Television that “the size of the movements is not such that this is a particularly worrisome development.”
The Bundesbank head added that the ECB is ready to adjust the pace of asset purchases if needed though, saying that “we want to preserve favorable financing conditions for the non-financial sector — that’s not just looking at financing costs for governments, it’s a much broader picture.”
Bank of Spain Governor Pablo Hernandez de Cos said at a separate event that rising yields may reflect market expectations of an earlier start to unwinding monetary stimulus, and that “avoiding premature increases in nominal interest rates” is essential.
Earlier in the week, Executive Board member Fabio Panetta said the jump in yields “is unwelcome and must be resisted.” He also said it is “not too late” to act. French Governing Council member Francois Villeroy de Galhau said the ECB “can and must react” to any unwarranted moves.
The latest purchasing data surprised investors though by showing that the central bank actually slowed buying last week, despite President Christine Lagarde saying policy makers are “closely monitoring” the rise in nominal bond yields.
Those figures don’t reflect orders made Thursday and Friday, as transactions take a couple of days to settle and show up in the central bank’s accounts. This week’s purchasing data will be published next Monday and Tuesday.
Investors have been closely watching for any signs of market intervention by the ECB. Vincent Juvyns, a strategist at JPMorgan Asset Management, said on Bloomberg radio that in contrast to the U.S., where the economy is being boosted by massive stimulus, “it is probably too early to allow rates to rise in Europe.”
“I would hope and expect that the ECB would be a bit fire-fighting with additional buying in the coming weeks and months,” he said.
OPEC+ is poised to cool oil market with extra production
InternationalMar 04. 2021Oil pumping jacks operate in an oilfield near Almetyevsk, Tatarstan, Russia, on March 11, 2020. MUST CREDIT: Bloomberg photo by Andrey Rudakov.
By Syndication Washington Post, Bloomberg · Javier Blas, Grant Smith, Salma El Wardany
OPEC+ is poised to agree a production increase this week as it seeks to cool a rapid rally in crude prices.
There is a widespread view within the group that the market can absorb additional barrels, according to people familiar with the deliberations. While the usual differences are present — with Saudi Arabia cautious and Russia keen to open the taps — all sides are ready to increase production, they said, asking not to be named because the information was private.
That could put the group on track to implement the majority of the 1.5 million barrel-a-day output increase that’s up for debate on Thursday.
An agreement to hike OPEC+ supply would be the latest sign that the global economy is recovering from the damage wrought by the coronavirus pandemic. The cartel has endured a year of pain, dominated by the deepest output cuts in its history. But the sacrifice has paid off, reviving oil prices back to pre-crisis levels above $60 a barrel.
Brent crude rose 0.3% to $62.89 a barrel as of 7:54 a.m. in London. The international benchmark has surged more than 20% this year.
“Both the global economic outlook and oil market prospects show signs of continued improvement,” OPEC Secretary-General Mohammad Barkindo said at the opening of a meeting of the group’s technical experts on Tuesday. “The headwinds of uncertainty that shocked and disrupted the market last year continue to abate.”
There are two distinct elements to the production increase that the Organization of Petroleum Exporting Countries and it allies will debate this week.
First, will the cartel proceed with a 500,000 barrel-a-day collective output hike in April? Second, how will Saudi Arabia phase out the extra supply reduction of 1 million barrels a day it’s been making voluntarily in February and March?
Russia has been the most consistent advocate for the 500,000 barrel-a-day increase, and other members now largely agree that it should go ahead, according to people familiar with the matter.
The top oil executive from the United Arab Emirates, which has also supported output hikes at recent OPEC+ meetings, gave a bullish assessment of the market on Tuesday.
“Oil demand is robust,” Sultan Al Jaber, the chief executive officer of Abu Dhabi National Oil Co., said at the IHS Markit Ltd. CERAWeek virtual conference. “Demand will rise to above pre-covid levels by the end of this year.”
Adnoc has already signaled it’s preparing to open the taps, allocating customers greater volumes of Murban, Das and Upper Zakum crudes for April compared with March.
Saudi Arabia always said that its voluntary supply reduction would only last for two months, but seasoned OPEC-watchers have suggested that Riyadh could phase it out gradually.
The kingdom will start to roll back its extra cut as planned in April, but is still discussing internally whether to return all of the barrels in a single month, or over a longer period, said people familiar with the deliberations. The decision will take into account the commissioning of the new 400,000 barrel-a-day Jizan refinery, which could affect both domestic crude consumption and exports, they said.
At CERAWeek, Saudi Aramco CEO Amin Nasser struck a more cautious tone than his counterpart from the UAE, predicting strong demand in the second half of 2021, and a return to pre-Covid consumption next year.
Whatever the Saudis decide, the global oil market is poised to receive its biggest supply boost since August, when OPEC+ first began the process of tapering the 9.7 million barrel-a-day cut agreed in April last year as the pandemic crushed demand.
The group appears to think the market is ready for it. Even if OPEC+ boosts production by 2.4 million barrels a day between February and June — the maximum amount allowed under the current deal — it will still be able to clear the remnants of the 2020 supply glut by August, the secretariat’s analysts predicted on Tuesday.
Achieving that would be a remarkable comeback from one of the biggest crises in the cartel’s history. It’s almost exactly a year since a disagreement between Russia and Saudi Arabia over how to respond to the early stages of the pandemic triggered a monthlong price war. The group flooded the market just as demand plunged, a disastrous decision that pushed crude prices below zero for the first time in history.
Twelve months later, fuel stockpiles in industrialized countries aren’t far off target levels and crude prices are close to break-even for some members, presenting “the perfect opportunity for OPEC+ to raise production,” analysts at Australia & New Zealand Banking Group Ltd. said in a note.
Amazon, Google vie for piece of India’s digital payments market
InternationalMar 04. 2021A customer pays Indian Rupee banknotes to a vendor at a sim card store in Mumbai on April 21, 2018. MUST CREDIT: Bloomberg photo by Dhiraj Singh.
By Syndication Washington Post, Bloomberg · Saritha Rai
Technology giants Facebook, Amazon.com and Google and credit-card providers Visa and Mastercard are among those vying for unprecedented access to India’s burgeoning digital retail payments market.
The companies are part of four consortia preparing to apply for licenses to operate retail payments and settlement systems in the country, people familiar with the matter said. More companies could band together before a March 31 application deadline.
In a market where cash is still king, digital payments are quickly gaining ground as India’s 1.3 billion people are starting to embrace online shopping and services such as online gaming and streaming. With Credit Suisse Group predicting $1 trillion in online payments in India in 2023, the companies chosen to enable such transactions stand to reap lucrative commissions.
“India’s mobile digital payments is seeing huge growth in a post-pandemic world,” said Vijay Shekhar Sharma, founder and chief executive officer of New Delhi-based payment provider Paytm. “It’s a good time to open up more diverse payments solutions and keep the momentum going.”
One of the consortia consists of Amazon, Visa, Indian retail banks ICICI Bank and Axis Bank as well as fintech startups Pine Labs and BillDesk. Another group is led by billionaire Mukesh Ambani’s Reliance Industries and its partners Facebook and Google, which together agreed to invest more than $10 billion in Reliance’s digital services unit last year.
Sharma’s Paytm heads a group that includes ride-hailing startup Ola and at least five other companies. The fourth consortium consists of Tata Group, Mastercard, telecom operator Bharti Airtel and retail banks Kotak Mahindra Bank and HDFC Bank.
Sharma, a spokeswoman for Tata Group and a spokesman for Google declined to comment on the potential bidders. Amazon and Facebook didn’t respond to emailed questions.
The contest is fierce as regulator Reserve Bank of India is expected to give just one or two licenses, as implied in its notification inviting bids. The process to decide the winners could take at least six months and it could be a further year or more before the systems and solutions come into use.
The winners will take on National Payments Corporation of India, the sole pioneering umbrella organization backed by more than 50 retail banks. Its Unified Payments Interface, or UPI, protocol debuted in 2016 and set the digital payments arena afire by allowing users to link their phone numbers to their bank accounts. That made transferring and receiving money via apps as easy as sending a text message, allowing large scale and high volumes of transactions to happen at minimal cost.
“The regulator probably doesn’t want concentration risk as the UPI backbone has become critical to the economy,” said Nandan Nilekani, who conceived and built a biometric identity database the system uses to identify users. “With more licensees and these systems presumably being able to operate seamlessly with each other, the aim seems to be to reinvigorate innovation and push digital payments even deeper into the country,” said Nilekani, co-founder and chairman of IT services company Infosys Ltd.
Though commissions on digital payments are thin, the volume is potentially huge as India tries to reduce its reliance on cash. Card and mobile payments represented only 21% of $781 billion in retail purchases at brick-and-mortar stores in 2019, according to an estimate by S&P Global Market Intelligence.
The new licensees could make money by charging businesses transaction fees. They can also break new territory by setting up and operating ATMs, point-of-sale systems, remittance services and new innovative payment solutions.
“There seems to be a prime mix of regulatory support and innovation attracting investors to the space right now,” said Anis Uzzaman, general partner and chief executive officer of Silicon Valley-based Pegasus Tech Ventures, an investor in Robinhood and other fintech startups. “A new generation of entrepreneurs is grabbing the opportunity.”
Sunak to hike U.K. business tax to pay for covid’s economic bill
InternationalMar 04. 2021Chancellor of the Exchequer Rishi Sunak on March 3, 2020, in London. MUST CREDIT: Bloomberg photo by Hollie Adams.
By Syndication Washington Post, Bloomberg · Alex Morales, Andrew Atkinson
U.K. finance minister Rishi Sunak announced he will carry on spending to help the economy through the pandemic emergency but outlined a plan for businesses and individuals to start paying the huge bill in the years ahead.
With the country mired in a third national lockdown, the chancellor of the exchequer delivered his annual budget and made clear that saving jobs is his immediate priority.
He added 65 billion pounds ($90.7 billion) of aid to help companies and citizens make it through the rest of this year and next, taking the government’s total fiscal support to 407 billion pounds.
In a dramatic statement to Parliament, Sunak then sketched out a blueprint to start restoring the U.K.’s battered public finances over the coming years. At the center of his plan is a politically risky freeze of income tax thresholds, pulling more people into paying higher bills as earnings rise in future, and an increase in corporation tax to 25% in 2023, from 19% now.
Given how much the government is spending to help businesses through the crisis, it is “fair and necessary” to ask them to contribute, Sunak said.
“It’s going to take this country – and the whole world – a long time to recover from this extraordinary economic situation,” the chancellor told members of Parliament. “Once we are on the way to recovery, we will need to begin fixing the public finances – and I want to be honest today about our plans to do that.”
The U.K. economy has already suffered its deepest recession in more than 300 years, alongside the worst pandemic death toll in Europe. Official forecasts Wednesday confirmed the economy will suffer long-term damage from the crisis, lasting years.
Key budget developments include:
– Income tax thresholds will be frozen for the basic 20% rate and higher 40% rates after next year, potentially dragging more people into paying more tax as their earnings increase in future years. Sunak said he wasn’t “hiding” this policy, and argued it will be “progressive and fair.”
– The 5% reduced rate of VAT will be extended for six months to Sept. 30.
– The stamp duty holiday, which pauses taxing home sales, will be extended until June 30.
– The furlough wage support program will be extended through September. As businesses reopen, from July, they will be asked for a contribution of 10%, rising to 20% in August and September.
– The 20 pound a-week uplift to Universal Credit welfare payments will be extended for six months.
– Planned rises in alcohol and fuel duty will be canceled.
– The Bank of England is being ordered to drive the U.K.’s goals toward eliminating greenhouse gas pollution.
– The U.K. economy, which shrank almost 10% last year, is forecast to expand by 4% this year, according to the Office for Budget Responsibility.
– The economy will grow 7.3% next year, stronger than forecast, but after five years it will remain 3% smaller than it would have been without the pandemic.
– Gilts fell across the curve on Wednesday after the Debt Management Office announced that it will sell 295.9 billion pounds ($413 billion) of bonds in 2021-22.
“When Chancellor of the Exchequer Rishi Sunak looks back at his March 2021 budget, he’ll probably be able to say he got the balance right. He extended significant near-term support to help drive the recovery from the pandemic while deferring most tax increases until the economy has healed,” said Dan Hanson, senior economist with Bloomberg Economics.
The extended aid for workers and businesses will help prevent a surge in unemployment. But it will also add to the 300 billion pounds the U.K. has spent fighting the pandemic amid the sharpest contraction since the Great Frost of 1709.
Sunak is aiming to strike a balance between providing short term emergency help for a country still battling to emerge from lockdown, while seeking to reassure markets that he will get a grip on the deficit before too long.
Politically, Sunak is in danger of infuriating his Conservative colleagues who do not want taxes on business to rise and may worry that increased bills for citizens ahead of the 2024 election will cost the party votes.
The economic risk is that planned tax increases and the withdrawal of state support could deter investment and potentially stifle the longer-term recovery.
With that in mind, Sunak also announced measures to encourage investment and incentives for businesses to hire more apprentices. A new “super deduction” policy will be introduced, which will mean that for the next two years when companies invest, they can reduce their taxable income by 130% of the cost of that investment.
“We’ve never tried this before in our country,” Sunak said. Forecasters say the plan will boost business investment by 10%, he added.
The main opposition Labour Party said the chancellor was desperate to slash government aid for those who need it.
“Behind the spin, the videos and the photo ops, we all know the chancellor doesn’t believe in an active and enterprising government,” Labour Leader Keir Starmer said. “We know he’s itching to get back to his free market principles and to pull away support as quickly as he can.”
While the national debt has risen past a record 2 trillion pounds, historically low interest rates means the cost of servicing it is low. That gives the chancellor breathing space, although he’ll also have an eye on the next general election due in 2024.
Myanmar’s military has asked security forces responsible for deadly attacks on anti-coup protesters over the weekend not to use live ammunition as international condemnation grows.
The announcement was made in a broadcast on state-run MRTV after the Southeast Asian nation on Sunday saw its deadliest day since the Feb. 1 coup, with the United Nations saying at least 18 protesters were killed and 30 others wounded. The military also said Monday that more than 1,300 protesters were arrested during nationwide demonstrations.
“When it comes to crowd dispersal methods, security forces have been instructed not to use live bullets,” the broadcast stated, accusing protesters of instigating violence by using slingshots and petrol bombs. “Security forces are allowed to protect themselves when protesters harm their lives by firing shots at the protesters below the waist.”
It wasn’t immediately clear that troops would use only rubbers bullets in their defense.
A new wave of rallies began Tuesday morning after a Myanmar court brought additional charges against detained civilian leader Aung San Suu Kyi that could keep her behind bars for an even longer period of time. The rising death toll may increase pressure on governments around the world to take more action against Myanmar’s generals, who refused to recognize a landslide election victory by Suu Kyi’s political party in November.
The call to refrain from using live rounds comes as foreign ministers in the 10-member Association of Southeast Asian Nations are set to hold an informal meeting Tuesday to discuss the situation in Myanmar for the first time since the coup. ASEAN has long followed a policy of nonintervention in the domestic affairs of its members, which include Myanmar, also known as Burma. It has thus far refrained from condemning the military for its actions or referring to the coup.
Thai Prime Minister Prayuth Chan-Ocha reportedly referred to it as a “political issue” that is “their country’s matter.” Indonesia, on the other hand, issued a statement Sunday calling on security forces to “refrain from the use of force and exercise utmost restraint to avoid further casualties.”
“Instability in Myanmar ultimately creates danger for the rest of us in Southeast Asia, so it’s not a purely Myanmar situation alone,” Singapore Minister of Foreign Affairs Vivian Balakrishnan said during an interview on Monday with local television outlet Channel 5. “Although, as I said, the responsibility for resolving this lies with the authorities in Myanmar.”
By The Washington Post · Anne Gearan, Ellen Nakashima
WASHINGTON – The Biden administration on Tuesday announced punitive sanctions against senior Russian government figures for the poisoning of opposition leader Alexei Navalny, the first of what is likely to be a series of actions designed to signal a tougher approach to Moscow than that taken by President Donald Trump.
The sanctions block access to financial and other assets in the United States for seven top figures around Russian President Vladimir Putin, though not Putin himself. The United States also reiterated its demand that Navalny be released from detention.
The largely symbolic penalties represent the first Biden administration action against Russia, and U.S. officials said it is a signal that Biden will treat Russia differently than his predecessor did.
“The U.S. government has exercised its authorities to send a clear signal that Russia’s use of chemical weapons and abuse of human rights have severe consequences,” Secretary of State Antony Blinken said in a statement. “Any use of chemical weapons is unacceptable and contravenes international norms.”
He called Navalny’s prosecution and imprisonment “politically motivated” and said the Russian government must release Navalny immediately.
Putin’s Russia poses one of the thorniest foreign relations problems facing Biden, complicated by Trump’s tendency to dismiss or defend some of Putin’s most belligerent actions.
Biden has said he will confront Putin over actions that harm the United States or its allies, while seeking cooperation with Moscow on arms control, climate change and other issues. The United States blames Russia for undermining U.S. and European elections, promoting disinformation and cyberattacks, and threatening its neighbors, including Ukraine.
Biden’s administration shares a widening European concern that Russia is becoming more authoritarian and isolated from Europe, giving the West less leverage and dulling the effect of sanctions like those imposed Tuesday.
“It was not meant to be a silver bullet or an ending to what has been a difficult relationship with Russia,” said White House press secretary Jen Psaki. “We expect the relationship to continue to be a challenge. We’re prepared for that, and we’re neither seeking to reset our relations with Russia nor are we seeking to escalate.”
That comment was intended to suggest that Biden will not follow previous administrations – including that of Barack Obama – that pledged to “reset” the U.S. relationship with Russia, only to see those efforts fail.
Russia denies poisoning Navalny, and Foreign Ministry spokeswoman Maria Zakharova on Tuesday called the U.S. sanctions “a hostile anti-Russian attack,” suggesting that Moscow would retaliate. In the past, Russia has responded in tit-for-tat fashion to sanctions and punitive actions such as the expulsion of diplomats.
“All this is just a pretext for continuing open interference in our internal affairs,” Zakharova said. “We do not intend to put up with this.”
Psaki said the new penalties stem from a U.S. intelligence assessment that found “with high confidence” that Navalny was poisoned by officers of Russia’s Federal Security Service in August 2020.
The administration also announced new export restrictions on items that could be used to manufacture chemical weapons, as well as a widening of existing sanctions under a law controlling use of such weapons.
Navalny nearly died from the poisoning last year, but he traveled to Germany for treatment and ultimately recovered. Returning to Moscow in January, he was promptly jailed and sentenced to more than two years behind bars on what human rights advocates call manufactured charges.
Two days after his arrest, a bombshell video starring Navalny was released through supporters. It accuses Putin of colossal corruption and mocks the Russian leader as a power-mad king. Navalny’s arrest sparked mass protests in Russian cities, a movement that continues to pose a rare threat to Putin’s authority.
The U.S. sanctions largely mirror actions taken by the European Union and Britain. The EU announced additional actions in concert with Washington on Tuesday.
The Trump administration had declined to join the EU’s initial actions last fall, and Trump himself was reluctant to assign blame for the attack on Navalny.
While Putin is not among those targeted – sanctioning a head of state carries additional diplomatic and logistical challenges – the list does include another top official, the director of the Federal Security Service, Aleksandr Bortnikov.
Two of the entities named were already under U.S. sanctions imposed during the Trump and Obama administrations. The FSB, a successor agency to the KGB, had been sanctioned in 2016 and 2018 for election interference and other malign cyberactivities. The GRU, Moscow’s military intelligence agency, was likewise sanctioned in 2016 and 2018 for election interference.
A December investigation by Bellingcat, an independent investigative group, linked members of what it called a secretive toxins unit within the FSB to long-term surveillance on Navalny, placing agents in the Siberian city of Tomsk, several hundred yards from Navalny’s hotel before his poisoning.
A later Bellingcat investigation linked the unit with surveillance of three other journalists and politicians who died suddenly under mysterious circumstances.
The new sanctions are the first of several steps the administration is planning to hold Russia to account for destabilizing actions in four areas, senior administration officials said Tuesday, speaking on the condition of anonymity to describe sensitive matters.
Coming “sooner rather than later,” one official said, will be U.S. responses to Moscow’s SolarWinds hacks of federal agencies and private-sector entities, Russian efforts to meddle in the 2020 election, and reports of Russian bounties on the lives of U.S. troops in Afghanistan.
All these areas were the subject of intelligence reviews ordered by Biden on his first full day in office.
The response to the SolarWinds hack will probably include not only sanctions but also at least one executive order aimed at shoring up federal cybersecurity, as well as a stronger statement linking Moscow to the hacks than the Trump administration issued in January.
The hacks penetrated nine federal agencies and at least 100 private entities. A senior administration official told The Washington Post that it represented a “broad, indiscriminate compromise” that “crosses a line of concern to us because it can be turned to be disruptive so quickly.”
Psaki said the responses to Russia’s hostile activities will be “seen and unseen,” an allusion to possible covert operations.
In addition to Bortnikov, the officials targeted Tuesday include the head of Putin’s domestic policy office, Andrei Yarin, and a leader of the president’s executive office, Sergei Kiriyenko.
Kiriyenko and Yarin have both played important roles in the Kremlin’s full-scale effort to pursue and neutralize Navalny, which has been underway since 2013. The campaign includes propaganda efforts designed to discredit Navalny, such as recent state-sponsored campaign to portray him as a Nazi.
According to the Russian investigative outlet Proyekt, the presidential office orchestrated a plan to smear Navalny after he criticized supporters of constitutional amendments allowing Putin to rule until 2036. Navalny tweeted that they were traitors, leading to a libel case that saw him convicted of insulting a World War II veteran.
Navalny’s Anti-Corruption Foundation last month called on the United States and the EU to sanction top oligarchs who support and benefit from Putin’s regime, arguing that they play a key role in propping up his power.
Maria Pevchikh, a senior investigator with Navalny’s foundation, said Tuesday that the sanctions against officials in Putin’s regime were important, but she expressed disappointment that they fell short of punishing oligarchs close to Putin.
“The most painful sanctions – which, unfortunately, neither Europe nor the United States have yet reached – are the sanctions against the oligarchs,” Pevchikh said, adding that “it is difficult for an official from these countries to fully comprehend how strongly the Putin regime is tied to the money of these oligarchs.”
Alexander Gabuev, a senior fellow at the Carnegie Moscow Center, said the administration’s coordinated response with Europe is more effective than Trump’s go-it-alone approach. But, he said, it is “very unlikely to change the fate of Mr. Navalny. It will impose costs on Russia, but the costs are totally bearable.”
Gabuev said that those sanctioned are close to Putin and are prepared to “go down with him,” and that they have assets that are protected in Russia and are willing to refrain from travel outside the country. “Another round of sanctions gives them a badge of honor internally – and more clout in the system,” he said.
In the United States, however, Biden’s action drew bipartisan support, even as some urged further actions.
“I have called on the administration to hold Vladimir Putin accountable for his unconscionable attempts to silence his opponents, and I support their actions today to implement these sanctions,” said Rep. Michael McCaul, R-Texas, the senior Republican on the House Foreign Affairs Committee.
Sen. Ben Sasse, R-Neb., a member of the Senate Intelligence Committee, said the sanctions “send a clear message to Moscow” but are not enough. “We need to kneecap all financial support to Putin’s corrupt regime,” Sasse said.
Senate Foreign Relations Committee Chairman Robert Menendez, D-N.J., also said the sanctions should be followed by other actions to keep “dirty Russian money” out of the U.S. financial system.
“After four years of Donald Trump’s kowtowing to Putin, getting our sanctions regime back on track will demonstrate our rejection of Russia’s lawless behavior and resolve to change it,” Menendez said.