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US, China Agree to Hold Next Round of Trade Talks in September

The latest round of trade talks between U.S. and Chinese negotiators ended in Shanghai Wednesday with an agreement to meet again in September in the U.S.

Although neither side immediately commented on the talks, China’s official Xinhua news agency reported the talks were “frank, highly efficient and constructive.”

The news agency also reported negotiators discussed “the issue of China increasing its purchases of U.S. agricultural products, according to its domestic needs.”

U.S. and Chinese representatives held talks at a working dinner on Tuesday and less than a half day of negotiations on Wednesday before the U.S. delegation headed straight to the airport.

Shortly after U.S. negotiators arrived in Shanghai on Tuesday, U.S. President Donald Trump warned China against negotiating a deal after the 2020 U.S. presidential election  — declaring a delayed agreement would be less attractive than a deal reached in the near term.

“The problem with them waiting … is that if & when I win, the deal that they get will be much tougher than what we are negotiating now … or no deal at all,” Trump said in a post on Twitter.

…to ripoff the USA, even bigger and better than ever before. The problem with them waiting, however, is that if & when I win, the deal that they get will be much tougher than what we are negotiating now…or no deal at all. We have all the cards, our past leaders never got it!

— Donald J. Trump (@realDonaldTrump) July 30, 2019

Foreign Ministry spokeswoman Hua Chunying responded to Trump’s tweet on Wednesday, telling reporters at a daily news briefing in Beijing “it doesn’t make any sense for the U.S. to exercise its campiagn of maximum pressure at this time.”

Hua also said “It’s pointless to tell others to take medication when you’re the one who sick.”

U.S. and Chinese officials gathered in Shanghai in an attempt to revive talks, with both sides trying to temper expectations for a breakthrough.

The world’s two largest economies are engaged in an intense trade war that has dragged on for more than a year, having imposed punitive tariffs on each other totaling more than $360 billion in two-way trade.

The Shanghai negotiations came after Trump and Chinese President Xi Jinping agreed at June’s G-20 summit to resurrect efforts to end the costly trade war over China’s technology ambitions and trade surplus.

China is resisting U.S. demands to abolish government-led plans for industrial leaders to enhance robotics, artificial intelligence and other technologies.

The U.S. has complained China’s plans depend on the acquisition of foreign technology through theft or coercion.

Days prior to the Shanghai meeting, Trump threatened to withdraw recognition of China’s developing nation’s status at the World Trade Organization. China responded by saying the threat is indicative of the “arrogance and selfishness” of the U.S.

The U.S. delegation in Shanghai was represented by Treasury Secretary Steve Mnuchin and Trade Representative Robert Lighthizer. They met with a Chinese delegation led by Vice Premier Liu He, who serves as the country’s economic czar.

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Rights Group Says Prisoners Go on Hunger Strike in Egypt

Amnesty International says 130 detainees in a notorious Egyptian prison have been on hunger strike for more than six weeks to protest what it calls “cruel and inhumane detention conditions.”
 
The international rights group on Wednesday called on authorities to investigate the prisoners’ allegations of torture and other abuses.
 
Magdalena Mughrabi, Amnesty’s Middle East and North Africa deputy director, says “the combination of squalid and inhumane detention conditions and the denial of family visits and access to their lawyers… has created an unbearable situation for detainees.”
 
The detainees are being held at a Cairo prison known as the Scorpion, where a number of political figures have been jailed over the course of a sweeping crackdown on dissent in recent years.
 
Calls to the Interior Ministry spokesman requesting comment went unanswered.

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Loophole Allows Families to Get Aid Meant for Needy Students

The U.S. Education Department is being urged to close a loophole that has allowed some wealthy families to get federal, state and university funding that’s meant to help needy students.

Federal authorities were notified last year that some parents in Illinois were transferring custody of their children to friends or relatives to make it appear they came from poorer backgrounds. In doing so, they became eligible for scholarships and federal grants that are typically reserved for low-income students.

Disclosure of the practice comes at a time of intense debate over the fairness of college admissions. Earlier this year, federal authorities say they uncovered a sweeping scheme in which wealthy parents paid bribes to get their children into elite universities across the nation.

The latest case was uncovered at the University of Illinois after guidance counselors at nearby high schools caught wind of the scheme and notified the school’s admissions office. University officials soon noticed a pattern of students coming from certain Chicago suburbs with recent guardianship transfers and similar language in their applications. In total, the school says it has identified 14 cases over the last year.

Andy Borst, director of undergraduate admissions, said that while the strategy appears to be legal, it’s ethically questionable. By tapping into funding for needy students, he said, wealthy families deprive students who legitimately need help. Some of the families were able to obtain state grants that are first-come, first-served, while thousands of other students were turned away.

“Financial aid is not infinite,” he said. “There are students who are eligible for need-based aid who are not receiving their awards because the state runs out.”

The Education Department’s inspector general said it’s aware of the issue and is urging the agency to add new language to its rules to close the loophole. Under the proposed update, changes of guardianship would not be recognized “if a student enters into a legal guardianship but continues to receive medical and financial support from their parents.”

A statement from the department said it’s weighing how to respond.

“Those who break the rules should be held accountable, and the department is committed to assessing what changes can be made — either independently or in concert with Congress — to protect taxpayers from those who seek to game the system for their own financial gain,” according to the statement.

The scheme, which was first reported Monday by Pro Publica and The Wall Street Journal, has been traced to clusters of parents in Chicago suburbs. It’s unclear how widespread the scheme reaches, but Pro Publica reported that students involved have been accepted to schools including the University of Missouri, the University of Wisconsin and Indiana University. Those schools said they’re looking into the issue.

A statement from the University of Wisconsin said it will review all cases of legal guardianship to verify “genuine financial need.” Indiana University said it will contact any involved students and request documentation to verify financial aid eligibility. The University of Missouri said it has a “very small number” of suspected cases but will pull institutional aid from any students who misrepresented their financial status.

News of the scheme is likely to trigger a wave of similar investigations at colleges across the country as officials try to determine the scope, according to admissions and financial aid groups.

“I can guarantee that they are going to start doing some digging on their own campuses to see if they see any patterns,” said Jill Desjean, a policy analyst at the National Association of Student Financial Aid Administrators.

Some parents told Pro Public and The Journal that they transferred custody of their children on the advice of a college consulting firm called Destination College, based in Lincolnshire, Illinois. The company’s website promises to help parents pay for college “in the most efficient and inexpensive way.” The firm did not respond to a request seeking comment.

After having their custody transferred, students can claim they are independent of their families and apply for financial aid using their own earnings rather than their families’. That would typically qualify them for federal Pell Grants, which are capped at about $6,000 a year, and an Illinois state program that provides about $5,000 a year. It could also make them eligible for university scholarships that range as high as the full cost of tuition.

Mark Sklarow, CEO of the Independent Educational Consultants Association, says both the guardianship scheme and the bribery scandal are symptoms of the spiraling cost of college tuition. Still, he denounced the scheme and said it unfairly robs students who need the most help.

“Guardianship laws are designed for when parents are unable or should not be responsible for a child’s well-being,” he said. “It isn’t something that is meant to be traded away in order to beat the system.”

To help spot the scheme, the University of Illinois added new questions for applicants who indicate they’ve had changes in guardianship. They’re now asked who pays their cellphone bills, for example, and their health care costs. But school officials and financial aid experts are wary of making the process overly complicated for students who have undergone legitimate custody transfers.

“We don’t want to see them having to jump through additional hoops,” said Desjean, of the financial aid association. “It could place an extra burden the most vulnerable students who really are in legal guardianship.”

Among the most immediate questions for the University of Illinois is whether to continue providing university aid to students who used the scheme. Officials said they’re still deciding. But when it comes to federal and state aid, the school is legally required to keep that money flowing to eligible families, said Borst, the admissions director.

“We’ve addressed it as much as we are able to legally,” he said. “But we’re still stuck with having to provide federal and state aid to families who are manipulating the financial aid process.”

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Boston Gang Database Made Up Mostly of Young Black, Latino Men

Boston police are tracking nearly 5,000 people — almost all of them young black and Latino men — through a secretive gang database, newly released data from the department shows.

A summary provided by the department shows that 66% of those in its database are black, 24% are Latino and 2% are white. Black people comprise about 25% of all Boston residents, Latinos about 20% and white people more than 50%.

The racial disparity is “stark and troublesome,” said Adriana Lafaille, a lawyer for the American Civil Liberties Union of Massachusetts, which, along with other civil rights groups, sued the department in state court in November to shed light into who is listed on the database and how the information is used.

Central American youths are being wrongly listed as active gang members “based on nothing more than the clothing they are seen in and the classmates they are seen with,” and that’s led some to be deported, the organizations say in their lawsuit, citing the cases of three Central American youths facing deportation based largely on their status on the gang database.

”This has consequences,” Lafaille said. “People are being deported back to the countries that they fled, in many cases, to escape gangs.”

Boston police haven’t provided comment after multiple requests, but Commissioner William Gross has previously defended the database as a tool in combating MS-13 and other gangs.

One 24-year-old native of El Salvador nearly deported last year over his alleged gang involvement said he was a victim of harassment and bullying by Bloods members as a youth and was never an MS-13 member, as police claim.

The man spoke to The Associated Press on the condition of anonymity because he fears retribution from gang members.

He said he never knew he’d made the list while in high school until he was picked up years later in a 2017 immigration sweep.

The gang database listed him as a “verified” member of MS-13 because he was seen associating with known MS-13 members, had feuded with members of the rival Bloods street gang, and was even charged with assault and battery following a fight at school, according to records provided by his lawyer, Alex Mooradian.

Mooradian said he noted in immigration court that the man, who was granted special immigrant juvenile status in 2014, reported at least one altercation with Bloods members to police and cooperated with the investigation. Witnesses also testified about the man’s good character and work ethic as a longtime dishwasher at a restaurant.

”Bottom line, this was a person by all metrics who was doing everything right,” said Mooradian. “He had legal status. He went to school. He worked full time. He called police when he was in trouble. And it still landed him in jail.”

Boston is merely the latest city to run into opposition with a gang database. An advocacy group filed a lawsuit this month in Providence, Rhode Island, arguing the city’s database violates constitutional rights. Portland, Oregon, discontinued its database in 2017 after it was revealed more than 80% of people listed on it were minorities.

In Chicago, police this year proposed changes after an audit found their database’s roughly 134,000 entries were riddled with outdated and unverified information. Mayor Lori Lightfoot also cut off U.S. Immigration and Customs Enforcement access ahead of planned immigration raids this month.

California’s Department of Justice has been issuing annual reports on the state’s database since a 2017 law began requiring it. And in New York City, records requests and lawsuits have prompted the department to disclose more information about its database.

In Boston, where Democratic Mayor Marty Walsh has proposed strengthening the city’s sanctuary policy, the ACLU suggests specifically banning police from contributing to any database to which ICE has access, or at least requiring police to provide annual reports on the database. Walsh’s office deferred questions about the gang database to police.

Like others, Boston’s gang database follows a points-based system. A person who accrues at least six points is classified as a “gang associate.” Ten or more points means they’re considered a full-fledged gang member.

The points range from having a known gang tattoo (eight points) to wearing gang paraphernalia (four points) or interacting with a known gang member or associate (two points per interaction).

The summary provided by Boston police provides a snapshot of the database as of January.

Of the 4,728 people listed at the time, a little more than half were considered “active” gang associates, meaning they had contact with or participated in some form of gang activity in the past five years. The rest were classified as “inactive,” the summary states.

Men account for more than 90% of the suspected gang members, and people between ages 25 and 40 comprise nearly 75% of the listing.

The department last week provided the summary along with the department’s policy for placing people on the database after the AP filed a records request in June.

The ACLU was also provided the same documents in response to its lawsuit as well as a trove of other related policy memos and heavily redacted reports for each of the 4,728 people listed on the database as of January, according to documents provided by the ACLU and first reported Friday by WBUR.

The ACLU has asked the city for less-redacted reports, Lafaille said. It’s also still waiting for information about how often ICE accesses the database and how police gather gang intelligence in schools.

”After all this time, we still don’t have an understanding about who can access this information and how it’s shared,” she said. “That’s something the public has a right to know.”

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California Governor Signs Bill on Presidential Tax Returns

California’s Democratic governor signed a law Tuesday requiring presidential candidates to release their tax returns to appear on the state’s primary ballot, a move aimed squarely at Republican President Donald Trump.

But even if the law withstands a likely legal challenge, Trump could avoid the requirements by choosing not to compete in California’s primary. With no credible GOP challenger at this point, he likely won’t need California’s delegates to win the Republican nomination.

”As one of the largest economies in the world and home to one in nine Americans eligible to vote, California has a special responsibility to require this information of presidential and gubernatorial candidates,” Democratic Gov. Gavin Newsom wrote in his veto message to the state Legislature. “These are extraordinary times and states have a legal and moral duty to do everything in their power to ensure leaders seeking the highest offices meet minimal standards, and to restore public confidence.”

New York has passed a law giving congressional committees access to Trump’s state tax returns. But efforts to pry loose his tax returns have floundered in other states. California’s first attempt to do so failed in 2017 when then-Gov. Jerry Brown, a Democrat, vetoed the law, raising questions about its constitutionality and where it would lead next.

”Today we require tax returns, but what would be next?” he wrote in his veto message. “Five years of health records? A certified birth certificate? High school report cards? And will these requirements vary depending on which political party is in power?”

While the law is aimed at Trump, it would apply to all presidential contenders and candidates for governor.

The major Democratic 2020 contenders have already released tax returns for roughly the past decade. Trump has bucked decades of precedent by refusing to release his. Tax returns show income, charitable giving and business dealings, all of which Democratic state lawmakers say voters are entitled to know about.

Candidates will be required to submit tax returns for the most recent five years to California’s Secretary of State at least 98 days before the primary. They will then be posed online for the public to view, with certain personal information redacted.

California is holding next year’s primary on March 3, known as Super Tuesday because the high number of state’s with nominating contests that day.

Democratic Sen. Mike McGuire of Healdsburg said it would be “inconsistent” with past practice for Trump to forego the primary ballot and “ignore the most popular and vote-rich state in the nation.”

McGuire said his bill only applies to the primary election because the state Legislature does not control general election ballot access per the state Constitution.

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Lebanon Music Festival Cancels Show After Christian Pressure

A multi-day international music festival in Lebanon said Tuesday that it’s cancelled a planned concert by a popular Mideast rock band whose lead singer is openly gay, apparently caving to pressure after weeklong calls by some Christian groups to pull the plug on the show, as well as online threats to stop it by force.

Festival organizers released a statement saying the “unprecedented step” of cancelling the performance by Mashrou’ Leila was done “to prevent bloodshed and maintain peace and stability.”

”We apologize for what happened, and apologize to the public,” it added.

Some church leaders and conservative politicians set off a storm of indignation on social media this week when they demanded that the Mashrou’ Leila concert be canceled, accusing the Lebanese group of blasphemy and saying some of its songs are an insult to Christianity. The band, known for its rousing music and lyrics challenging norms in the conservative Arab world, soon became the center of a heated debate about freedom of expression.

Online, some groups and users posted threats suggesting they would violently stop the concert.

Mashrou’ Leila was scheduled to perform in the coastal city of Byblos on Aug. 9, marking the third time the group takes part in the annual Byblos International Festival. The other performances will still take place.

The cancellation triggered a storm of protests and a campaign of solidarity with the band on social media by Lebanese who described it as shameful and a dangerous precedent.

”This is a step back for Lebanon, which has always prided itself on embracing diversity and being a center for music, art and culture,” tweeted Aya Majzoub, a Lebanon researcher at Human Rights Watch.

Amnesty International, in a statement, said the decision to cancel the show is an “alarming indicator” of the deteriorating state of freedom of expression in Lebanon.

”This is the direct result of the government’s failure to take a strong stand against hatred and discrimination and to put in place the necessary measures to ensure the performance could go ahead,” Amnesty International’s Middle East Research Director Lynn Maalouf said.

There was no immediate comment from the band, which last week issued a statement denouncing the “defamatory campaign” and saying that some of the lyrics from their songs were being taken out of context and twisted.

The group has been a champion of LGBT rights in the Arab world and regularly sings about controversial subjects such as sectarianism, corruption and other social and political problems.

The band has previously been banned from performing in Jordan and Egypt, but censorship demands threatening its concert in the more liberal Lebanon — where it has performed on numerous occasions — are new.

On Monday, dozens of Lebanese held a protest in downtown Beirut objecting to the proposed ban and rejecting attempts by Christian clergymen and some right wing groups to ban the group.

”Regardless of our opinion of the songs and the band, we need to defend freedom of expression, because freedom is for everyone and for everybody. The day it stops, it stops for everybody,” said writer and director Lucien Bourjeily.

The band, whose name translates as “Night Project,” was founded 10 years ago by a group of architecture students at the American University of Beirut whose songs challenged stereotypes through their music and lyrics.

Riding on the wave Arab Spring uprisings that swept the Middle East, the band was embraced by Arab youth who see its music as part of a cultural and social revolution. The band members have gone on to gain worldwide acclaim, performing in front of sold-out crowds in the United States, Berlin, London and Paris.

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Trump Administration Further Tightens Asylum Eligibility Requirements

The administration of U.S. President Donald Trump has tightened the eligibly requirements for seeking asylum in the United States, making it more difficult for those persecuted because of family ties to be granted protection.

U.S. Attorney General William Barr ruled Monday that that those who seek asylum because of a threat against another family member usually do not have enough of a reason to be granted asylum in the United States.

Barr, as head of the Department of Justice, has the ability to set standards for all U.S. immigration judges and to overturn immigration court rulings. 

U.S. law states that people can seek asylum in the United States if they can prove a fear of persecution based on their race, religion, nationality, political opinion or membership in a specific social group. Until now the term “social group” was often interpreted by immigration judges to include families.

In his ruling Monday, Barr argued that virtually all asylum-seekers are members of a family and said “there is no evidence that Congress intended the term ‘particular social group’ to cast so wide a net.”

His decision was in regards to a case involving a Mexican man who sought asylum because his family was targeted after his father refused to let a drug cartel use the family store.

The Trump administration has taken a series of measures to restrict asylum claims, including denying asylum requests to victims of gang violence or domestic abuse. The administration has argued that the asylum system is often abused by immigrants who use fraudulent claims to try to enter the United States.

Immigration activists say the administration’s latest decision reverses years of precedent and could affect thousands of people.

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Chinese ‘Cyberdissident’ Sentenced to 12 Years in Prison

A prominent Chinese human rights activist and journalist has been sentenced to 12 years in prison on charges of disclosing state secrets.

Huang Qi, 56, is the founder of the website 64 Tianwang, which documents alleged rights abuses by the government. He has been in custody for more than two years. 

His sentence is one of the harshest given to a dissident since President Xi Jinping came to power in 2012, according to court records.

Huang was guilty of “leaking national state secrets and providing state secrets to foreign entities,” the statement by the Mianyang intermediate people’s court said.

His website, which reported on local corruption, human rights violations, and other topics rarely seen in ordinary Chinese media, is blocked on the mainland.

The journalism advocacy group Reporters Without Borders (RSF) refers to Huang as a “cyberdissident,” and awarded him its Cyberfreedom Prize in 2016. A few weeks later, Huang was detained in his hometown of Chengdu, according to human rights group Amnesty International.

Human rights groups, including the RSF, called on Xi on Monday to pardon Huang. “This decision is equivalent to a death sentence, considering Huang Qi’s health has already deteriorated from a decade spent in harsh confinement,” said RSF chief Christophe Deloire.

Huang’s mother, Pu Wenqing, has asked authorities to move him to a hospital to receive treatment for kidney disease, severe weight loss and other ailments. 

Numerous Chinese dissidents have fallen ill while in state custody. Nobel Peace laureate Liu Xiaobo was serving an 11-year sentence for “inciting subversion of state power” when he died of liver cancer two years ago. 
 
According to RSF, China is currently holding more than 114 journalists behind bars and is ranked 177th out of 180 in the RSF 2019 World Press Freedom Index.

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UN Warns Islamic State Leader Plotting Comeback from Iraq

Margaret Besheer contributed to this report.

The Islamic State terror group’s self-declared caliphate may be dead, but its leaders are hanging on in Syria and Iraq, dreaming of the day when they can again direct attacks on targets around the world.

The conclusion is part of a sobering assessment in a newly released quarterly United Nations report on IS, also known as ISIS or ISIL, which warns the epicenter for the terror group’s budding renaissance is Iraq, “where Abu Bakr al-Baghdadi and most of the ISIL leadership are now based.”

“The leadership aims to adapt, survive and consolidate in the core area and to establish sleeper cells at the local level in preparation for eventual resurgence,” the report cautioned. “When it has the time and space to reinvest in an external operations capability, ISIL will direct and facilitate international attacks.”

In the meantime, the report warns the terror organization, “has continued its evolution into a mainly covert network,” since the fall of Baghuz, the last territory it held in Syria, this past March.

While the assessment that Baghdadi is operating mostly out of Iraq is new, the other warnings are similar to concerns voiced by U.S. officials and others dating back to last year.

Islamic State ‘Well-Positioned’ to Rebuild Caliphate

Destroying the Islamic State is proving more difficult than the United States and its allies envisioned, with the most recent intelligence assessments warning that the self-declared caliphate is well-positioned to rise again.

For months, U.S.

IS “is well-positioned to rebuild and work on enabling its physical caliphate to re-emerge,” Pentagon spokesman Commander Sean Robertson told VOA last August.

“This is not the end of the fight,” U.S. Special Representative for Syria, Ambassador James Jeffery, said this past March, following the fall of Baghuz.

More recently, a report by the Washington-based Institute for the Study of War (ISW), said the terror group is poised for a comeback that “could be faster and even more devastating” than when it first swept across parts of Syria and Iraq.

‘Devastating’ Islamic State Comeback Within Sight, Report Warns

Having strategically ceded ground to US-backed coalition, Institute for the Study of War warns terror group is already reasserting control in Iraq and poised to retake territory in Syria

Intelligence from U.N. member states anticipates that “comeback” will take place in the Syrian and Iraqi heartlands, where IS has the majority of its estimated 10,000 to 15,000 fighters, many in clandestine cells.

Echoing U.S. intelligence and military assessments, the U.N. report stated IS operations are more advanced in Iraq but that its operatives are still able to move freely across parts of both Iraq and Syria.

The group’s attacks, which seem to be coming with increased frequency, appear aimed at frustrating the local populations, for example burning crops in northern Iraq to prevent any steps toward recovery and stabilization.

“Their hope is that the local populations will become impatient, blame the authorities and grow nostalgic for the time when ISIL was in control,” the report said, adding member states fear it may be working.

At the same time, intelligence officials said IS is effectively using its media and propaganda arms to maintain relevance until such time that it is again ready to strike on the global stage.

Islamic State Terror Group Ramping Up Video Messaging

US Counterterror officials, analysts, warn the terror group’s media operatives are regrouping, intent on showing the world ‘ISIS has not been defeated’

Adding to the concerns of intelligence officials around the world are the large number of foreign fighters that may still be at large, either in Syria and Iraq, or in the surrounding countries.

U.S. counterterror officials estimate that more than 45,000 fighters from 110 countries flocked to Syria and Iraq, almost all to fight for IS.

As of earlier this year, as many as 10,000 were thought to be at large, having escaped the fall of the terror group’s caliphate. But the new U.N. assessment warns that number could be higher, and that “up to 30,000 of those who travelled to the so-called ‘caliphate’ may still be alive.”

Fears Grow Islamic State’s Foreign Fighters Ready to Carry On

This is part one of a four-part series.

WASHINGTON — Even as the Islamic State’s caliphate was clinging to life with its last defenders cornered in a small town in northeastern Syria, the terror group managed to shock those who would eventually see it die.
 
Instead of waiting out about 1,000 civilians and 300 or so hard-core IS fighters who had retreated to Baghuz, the U.S.-led coalition watched for weeks in late February and March, as upwards of 30,000 civilians and 5,000 fighters, slowly surrendered.
 
“Very much unanticipated,” a senior U.S.

Despite all this, the U.N. report finds IS still faces some significant challenges, especially when it comes to money.

While IS still has an estimated $50 million to $300 million in revenue left over from its self-declared caliphate, the group “is reported to lack liquid funds to run operations,” according to the report. As such, member states told the U.N. that IS operatives have become more dependent on crime while also trying to profit from legitimate businesses.

IS has also become more dependent on provinces and its more established affiliates, so it runs the risk that its agenda will slowly become less international and more regionalized. 

And it continues to face stiff competition from its main rival, al-Qaida, as the two terror groups battle in Syria and Iraq, and increasingly in parts of West Africa and the Sahel, for followers.

Al-Qaida, itself, also faces a somewhat uncertain future, at least in the near term, according the U.N. report, with its leader, Ayman al-Zawahiri, “reported to be in poor health and doubts as to how the group will manage the succession.”

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Poverty in Philippines, High for Asia, Falls as Economy Strengthens

Poverty in the Philippines, a chronic development issue that makes the country an outlier in Asia, is declining because of economic strength followed by job creation.

The archipelago’s official poverty rate dropped to 21% in the first half of last year from 27.6% in the first half of 2015, President Rodrigo Duterte said in his July 22 State of the Nation Address.

Economic growth of 6% plus since 2012 has helped to create jobs, especially in Philippine cities such as the capital Manila, economists who follow the country say.

“Twenty-seven percent is actually pretty high by kind of Asian standards, so I think that progress is attributable to the rapid economic growth that’s happened in the Philippines since 2012,” said Rajiv Biswas, Asia-Pacific chief economist at the market research firm IHS Markit.

Asian outlier

Poverty around Asia had declined from 47.3% in 1990 to 16.1% in 2013, according to World Bank data. Factory jobs, often driven by domestic export manufacturing industries, have fueled much of the boom, especially in China.

Poverty lingered in the Philippines largely for lack of rural jobs, economists believe. Rudimentary farming and fishing anchor the way of life on many of the country’s 7,100 islands. Foreign manufacturers often bypass the Philippines because of its remote location, compared to continental Asia, and relative lack of infrastructure that factory operators need to ship goods.

But the country hit a fast-growth stride in 2012 with a pickup in manufacturing and services. After growing just 3.7% in 2011, the GDP that now stands at $331 billion has expanded at between 6.1% and 7.1% per year.

More jobs

Urban jobs are getting easier to find as multinationals locate call centers in the Philippines, taking advantage of cheap labor and English-language proficiency.

A $169 billion, 5-year program to renew public infrastructure is creating construction jobs while giving factory investors new reason to consider siting in the country. Most new jobs now are in construction, with some in manufacturing, said Christian de Guzman, vice president and senior credit officer with Moody’s Sovereign Risk Group in Singapore.

Underemployment, he added, has “improved quite a bit,” de Guzman said.

“Jobs are being created (and in) the jobs that do exist, I think there’s more work to do, so to speak,” de Guzman said. “I guess less underemployment if you will, and again this is one of the fastest growing economies in Asia.”

Philippine unemployment edged down just 0.1 percentage point to 5.2% in January 2019 compared to a year earlier, but underemployment fell from 18% to 15.6% over that period, according to the Philippine Statistics Authority.

Tax reform

Duterte is also advancing tax reforms that he expects to lower poverty to 14% of the 105 million population by 2022. 

Tax revenue collected under these reforms will allow the government to spend more on health, education and other social services aimed at making people more prosperous, the Department of Finance said in a statement last year.

The Tax Reform for Acceleration and Inclusion Act (TRAIN), which Duterte signed into law in 2017, spells out changes in the tax code.

“Actually, one of the key elements there is the first tax laws that was passed, we call it the TRAIN one,” said Ramon Casiple, executive director or the advocacy group Institute for Political and Electoral Reform in Metro Manila.

Rural income

Longer-term poverty relief will come down to creation of rural jobs such as “specialized” or “advanced” agriculture, Biswas said. The 21% poverty rate is “still high,” he said. Government agencies and private firms over the past few years have already introduced hybrid seeds and new technology to make farming more self-sufficient, domestic news outlet BusinessWorld reported last year.

Natural disasters such as seasonal typhoons and a 50-year conflict between Muslims and the military in the south further hobble poverty relief, some analysts believe. Local government corruption also stops aid from reaching some of the poor, they suggest.

“Both growth and, in turn, poverty reduction seem to be hindered by several factors, including unequal wealth distribution both in terms of social groups and geographic distribution…corruption as well as natural disasters and ongoing conflicts, with the latter triggering a series of negative collateral effects,” said Enrico Cau, Southeast Asia-specialized associate researcher at the Taiwan Center for International Strategic Studies.

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PM Johnson Makes First Scotland Trip in Bid to Boost Union

New British Prime Minister Boris Johnson will make his first official visit to Scotland on Monday in an attempt to bolster the union in the face of warnings over a no-deal Brexit. 

Johnson will visit a military base to announce new funding for local communities, saying that Britain is a “global brand and together we are safer, stronger and more prosperous”, according to a statement released by his Downing Street Office.

It will be the first stop on a tour of the countries that make up the United Kingdom, as he attempts to win support for his Brexit plans and head off talk of a break-up of the union.

Scottish First Minister Nicola Sturgeon said last week that Scotland, which voted to remain in the EU in the 2016 referendum, needed an “alternative option” to Johnson’s Brexit strategy.

He has promised that Britain will leave the EU on October 31, with or without a deal.

Sturgeon, who leads the separatist Scottish National Party (SNP), told Johnson that the devolved Scottish Parliament would consider legislation in the coming months for another vote on seceding from the United Kingdom.

Irish prime minister Leo Varadkar has also said that a no-deal Brexit would make more people in Northern Ireland “come to question the union” with Britain.

Johnson, who decided that he will take the symbolic title of Minister for the Union alongside that of prime minister, will announce £300 million (£370 million, 332 million euros) of new investment for Scotland, Wales and Northern Ireland during Monday’s visit.

“Important projects like the government’s growth deals… will open up opportunities across our union so people in every corner of the United Kingdom can realize their potential,” he was to say.

“As we prepare for our bright future after Brexit, it’s vital we renew the ties that bind our United Kingdom.

“I look forward to visiting Wales and Northern Ireland to ensure that every decision I make as prime minister promotes and strengthens our union,” he will add.

Johnson plans to visit local farmers in Wales and discuss the ongoing talks to restore the devolved government when he visits Northern Ireland.

The investment boost comes after the prime minister announced a £3.6 billion fund supporting 100 towns in England, raising suggestions that he is already in campaign mode for an election. 

Many MPs are opposed to leaving the EU without a deal, and could try and topple the government in an attempt to prevent it, potentially triggering a vote.

Johnson has made a busy start to his premiership as he attempts win over public opinion for his Brexit plans and put pressure on those who could bring him down.

But the EU has already said his demands to renegotiate the deal struck by his predecessor Theresa May, but which was three times rejected by parliament, are  “unacceptable.”

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US China Move Trade Talks to Shanghai Amid Deal Pessimism

U.S. and Chinese trade negotiators shift to Shanghai this week for their first in-person talks since a G20 truce last month, a change of scenery for two sides struggling to resolve deep differences on how to end a year-long trade war.

Expectations for progress during the two-day Shanghai meeting are low, so officials and businesses are hoping Washington and Beijing can at least detail commitments for “goodwill” gestures and clear the path for future negotiations.

These include Chinese purchases of U.S. farm commodities and the United States allowing firms to resume some sales to China’s tech giant Huawei Technologies.

President Donald Trump said on Friday that he thinks China may not want to sign a trade deal until after the 2020 election in the hope that they could then negotiate more favorable terms with a different U.S. president.

“I think probably China will say “Let’s wait,” Trump told reporters at the White House. “Let’s wait and see if one of these people who gives the United States away, let’s see if one of them could get elected.”

For more than a year, the world’s two largest economies have slapped billions of dollars of tariffs on each other’s imports, disrupting global supply chains and shaking financial markets in their dispute over China’s “state capitalism” mode of doing business with the world. Trump and Chinese President Xi Jinping agreed at last month’s G20 summit in Osaka, Japan to restart trade talks that stalled in May, after Washington accused Beijing of reneging on major portions of a draft agreement — a collapse in the talks that prompted a steep U.S. tariff hike on $200 billion of Chinese goods.

Trump said after the Osaka meeting that he would not impose new tariffs on a final $300 billion of Chinese imports and would ease some U.S. restrictions on Huawei if China agreed to make purchases of U.S. agricultural products.

Chips and commodities

Since then, China has signaled that it would allow Chinese firms to make some tariff-free purchases of U.S. farm goods. Washington has encouraged companies to apply for waivers to a national security ban on sales to Huawei, and said it would respond to them in the next few weeks. 

But going into next week’s talks, neither side has implemented the measures that were intended to show their goodwill. That bodes ill for their chances of resolving core issues in the trade dispute, such as U.S. complaints about Chinese state subsidies, forced technology transfers and intellectual property violations.

U.S. officials have stressed that relief on U.S. sales to Huawei would apply only to products with no implications for national security, and industry watchers expect those waivers will only allow the Chinese technology giant to buy the most commoditized U.S. components.

Reuters reported last week that despite the carrot of a potential exemption from import tariffs, Chinese soybean crushers are unlikely to buy in bulk from the United States any time soon as they grapple with poor margins and longer-term doubts about Sino-U.S. trade relations. Soybeans are the largest U.S. agricultural export to China.

“They are doing this little dance with Huawei and Ag purchases,” said one source recently briefed by senior Chinese negotiators.

White House economic adviser Larry Kudlow on Friday said he “wouldn’t expect any grand deal,” at the meeting and negotiators would try to “reset the stage” to bring the talks back to where they were before the May blow-up. “We anticipate, we strongly expect the Chinese to follow through (on) goodwill and just helping the trade balance with large-scale purchases of U.S. agriculture products and services.” Kudlow said on CNBC television.

U.S. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer will meet with Chinese Vice Premier Liu He for two days of talks in Shanghai starting on Tuesday, both sides said.

“Less politics, more business,” Tu Xinquan, a trade expert at Beijing’s University of International Business and Economics, who closely follows the trade talks, said of the possible reason Shanghai was chosen as the site for talks. “Each side can take a small step first to build some trust, followed by more actions,” Tu said of the potential goodwill gestures.

‘Do the Deal’

A delegation of U.S. company executives traveled to Beijing last week to stress to Chinese officials the urgency of a trade deal, according to three sources who asked to not be named. They cautioned Chinese negotiators in meetings that if a deal is not reached in the coming months the political calendar in China and the impending U.S. presidential election will make reaching an agreement extremely difficult.

“Do the deal. It’s going to be a slog, but if this goes past Dec. 31, it’s not going to happen,” one American executive told Reuters, citing the U.S. 2020 election campaign. Others said the timeline was even shorter.

Two sources briefed by senior-level Chinese negotiators ahead of next week’s talks said China was still demanding that all U.S. tariffs be removed as one of the conditions for a deal. Beijing is opposed to a phased withdrawal of duties, while U.S. trade officials see tariff removal — and the threat of reinstating them — as leverage for enforcing any agreement. China also is adamant that any purchase agreement for U.S. goods be at a reasonable level, and that the deal is balanced and respects Chinese legal sovereignty.

U.S. negotiators have demanded that China make changes to its laws as assurances for safeguarding U.S. companies’ know-how, an insistence that Beijing has vehemently rejected. If U.S. negotiators want progress in this area, they might be satisfied with directives issued by China’s State Council instead, one of the sources said.

One U.S.-based industry source said expectations for any kind of breakthrough during the Shanghai talks were low, and that the main objective was for each side to get clarity on the “goodwill” measures associated with the Osaka summit.

There is little clarity on which negotiating text the two sides will rely on, with Washington wanting to adhere to the pre-May draft, and China wanting to start anew with the copy it sent back to U.S. officials with numerous edits and redactions, precipitating the collapse in talks in May.

Zhang Huanbo, senior researcher at the China Centre for International Economic Exchanges (CCIEE), said he could not verify U.S. officials’ complaints that 90 percent of the deal had been agreed before the May breakdown. “We can only say there may be an initial draft. There is only zero and 100% – deal or no deal,” Zhang said.

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