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US and UK complete a trade agreement, the first of its kind with major trading partners. US has a $11 billion surplus in $148 billion two way trade with UK which is just ahead of India and behind Vietnam in trade with the US. Vietnam has acted as aproxy for Chinese exports to US something the DJT administration is taking action to correct. UK first 100,000 cars exported to US will not face a 25% levy, and UK exports will only face the 10% levy on all countries, including on British aluminium and steel. This agreement happened Thursday May 8 after a night call from Trump to Starmer moving up the negotiations to get awin for the US and the UK, that will also act as a model for other countries to reach trade agreements with the US. India, Japan, South Korea, could be next followed by EU. It also opens up engagement with China on a trade agreement. UK's Starmer thanked president Trump. The agreement was a first and it boosts stock markets in the US, shows the US can do this. ...

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Winfried Vahland, the VW executive chosen to head the U.S. and Mexico operations by new VW CEO Muller, turns down the position. Vahland is one of the most experienced executives at VW, heading the China operations, and since 2010 in charge of the Skoda operations based in the Czech Republic. This is a setback for VW as it looks for ways to improve the management at all of its operations and make organizational changes.

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Crude oil or crude world. This book by Peter Maas "Crude World: The Violent Twilight of Oil," shows how places like Nigeria and Equatorial Guinea suffer from the lack of infrastructure and jobs, as the oil industry does not create many jobs and the companies and the ruling classes in these countries are the main beneficiaries. Nigeria's anticorruption official, Nuh Ribadu, is cited in the WSJ, with an estimate of $380 billion of $400 billion in oil revenues in Nigeria over 3 decades being wasted through corruption and misuse of funds, with little money going into infrastructure and jobs. Manufacturing in China, Vietnam, and Malaysia for basic consumer products from textiles to shoes, creates jobs even at low wages, making the people in these countries better off as wages rise. Oil on the other hand creates few jobs and companies do not move upscale manufacturing tech products in the next stage of manufacturing, leaving the people as worse off as before. The margins are thin in manufacturing, whereas much of the oil revenue can be deposited in accounts of influential individuals. Mouwad in the NYT points out 93% of profits go to the government in Nigeria, only 7% to western oil companies. Even in countries which have tried to root out corruption through socialist experiments such as Venezuela and religious parties such as in Iran, the failure to integrate with the globalized economy and extremist policies leads to lack of development and backwardness. This shows that the best way to develop is through emphasis on education, science and technology, building a culture that thrives on modernization and technological advancement over several decades, even if this means starting with basics and continually moving forwards into higher technologies. Japan, South Korea and China moved from shoes and textiles to iPads and smartphones, Japan starting in the 60's, S. Korea in the 80's and China in the 90's. ...

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In parts of Mexico sugary softdrinks are easier to access than clean tap water, says this report in DW.com. This is a problem that existed in Mexico for many years. Amy Guthrie in the WSJ August 28, 2013, described the problem in -Health Problem over Soda Flares in Mexico- which was shown in Lyrarc.com in 2013, showing the US, Chile, Mexico and Argentina with high consumption of sugary softdrinks and high rates of diseases related to this. Mexico's government has made efforts to increase awareness about the risks and dangers of overuse and Bloomberg philanthropy has made efforts to increase awareness. Yet the problem has persisted. The risks are high for countries such as India, China, Vietnam. One ad in Mexico City subways showed 20 ounce sugary softdrink bottle and asked "Would you take 12 teaspoonfuls of sugar?" Mexico passed the US in countries with high obesity rate over 100 million people in 2013. Higher all cause mortality was shown in a European study of 451,000 people for people drinking more than 2 glasses of sweetened softdrinks a day, with data collected between 1992-2000 and supporting public health campaigns limiting the use of such sweetened softdrinks. ...

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The new president of India Droupadi Murmu is from the state of Odisha, formerly called Orissa. She is from a tribal community in the state and brings a new face for development through "sab ka vikas sab ke sath" new India's slogan today of development for all Indians through their own efforts, as it brings to the forefront the tribal communities all over India. The tribal communities in India have a population of 106 million or about 9% of India's population. In Orissa percentage of tribal is over 25%, in most of the northeast it is at least 25%, and in borders areas with China Arunachal 70%, Sikkim 34%, Jammu & Kashmir 12%. In key states of Madhya Pradesh 20%, Gujarat 25%, Rajasthan 13%. The strategic nature of the decision for the unity of India can be seen on how the tribal communities are critical parts of the northeast, the border areas,  and even of the central, eastern and western regions of India which most people are not aware of. Bringing in the tribal communities through respected leaders is part of the unfinished work of Mohandas Gandhi in getting the delivery of services to the last man in the line, and the tribal communities are a forgotten part of this.   ...

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The Biden administration has announced a 100 day review of strategic vulnerabilities in America's supply chain. President Biden has said he supports funding of incentives for production in the US, to become independent of China and Taiwan. From 1990 onwards chip production in the US went from 37% to about 12% today. It will now go back up. Biden's National Security Adviser noted in an article in Foreign Policy that advancing industrial policy like Japan and France once considered out of tune is now essential, "something close to obvious."  At one point in the post war period America's most advanced jet engines were made in West Berlin, surrounded by the army of Russia and its ally the GDR. There is new realization that dependence on Taiwan which makes 22% of semiconductors worldwide and 50% of advanced designs cannot go on the way it is exposing a critical vulnerability for American industry. A 40% tax credit for the cost of new semiconductor fabrication plants and other incentives are now supported in the Biden administration. The whole idea is to turn this around quickly where US no longer depends on uncertain supplies from overseas. Four critical areas of strategic vulnerability will be reviewed- pharmaceuticals, semiconductors, batteries, and strategic materials. ...

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Senator Mitch McConnell, the U.S. Senate Majority leader, and Speaker Ryan, achieved a win in the U.S. Congress which is expected to set a new trend of bipartisan cooperation, as the House passed the bill in Dec. 2015 for $1.1 trillion spending with a vote of 316 to 113, and the Senate with vote of 65 to 33. The persuasion on the Republican side was based on giving Speaker Ryan a strong hand in negotiations with the White House in 2016. Ryan secured a lifting of the oil export ban for the Republican side in return for flexibility in spending. Ryan deftly sent the issue of Puerto Rico having access to bankruptcy laws to the committe chairmen to come up with a plan in March to get the needed votes. Democrats had pushed for aid to Puerto Rico. Also included in the bill that passed is giving more voice to emerging market countries China and India in the running of the IMF.

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One foreign policy expert says president Trump tried to reverse everything in Obama's foreign policy almost to the point of an obsession. He visits Saudi Arabia before visiting Mexico and Canada, close neighbors, as other presidents have done. The relationships with Mexico and Canada deteriorated. Yet Mr. Trump has a good personal connection with Trudeau of Canada and Macron of France.  Taking the advice of advisers including Commerce Secretary Wilbur Ross, president Trump despite tough talk on the North American Free Trade Agreement, takes a moderate approach on NAFTA renegotiation. Trump also softens some of the rhetoric on China as he seeks Chinese help to restrain North Korea. An international coalition of states supported by the U.S. reverses gains by Islamic State, with Iraq and Iran gaining over Islamic State. President Obama's policy of not taking decisive action, reversed towards the end of the second term, had led to the rise of Islamic State and the refugee crisis in Europe as refugees left Syria and Iraq. NATO or the South Korean defense was not significantly weakened as feared at the beginning of the first year. Missile defense proceeded in South Korea with U.S. missile systems. The appointment of a senior senator from Texas, Kay Hutchinson, signaled that the NATO policy had not changed significantly. As a result it could be said that the year 2018 began with a bang about the risks internationally with president Trump's unconventional approach, and ended without some of the worst fears being realized. Relations between North and South Korea improved as Koreans decided to work together for peace in the peninsula- with North Korea agreeing to participate in the Winter Olympics in South Korea.   ...

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China is increasing export rebates aand investing in vocational training to keep the economy growing . Laid off workers are returning to their farms. THe real impact on growth and industrial production will come in 2009 according to Clement Chen, the chairman of the Federation of Hong Kong Industries. Because China has sustained a high growth rate for so long and the US has not yet felt the full impact of the recession it is possible to underestimate the impact on China's export dependent economy of a deep slump in exports as western markets shrink. The current 9% for the third quarter which does not reflect the credit crisis of October in global markets shows merely the early impact of slowing growth, with serious debt induced dowturn in the western economies China could see its growth drop to 6-7%.

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The EU with its $15.4 trillion economy is a bloc comparable in size to the U.S. $19.4 trillion economy. The French State Secretary for Europe, Mr. Lemoyne, says EU does not need to be worried about the way the USMCA, new version of NAFTA was negotiated with pressure from president Trump, as the Europeans are the largest trading power in the world. The EU exports to the U.S. are $252 billion, and up 5% in the seven months of 2018 over the preceding period. The U.S. by comparison exports $153 billion which has remained at the same level with a $600 million decline in the same period in 2018.  President Trump has put pressure on the EU to help improve the trade imbalance. Soya bean exports are pointed to by the EU as this has doubled in 2018, after China responded to U.S. sanctions by limiting soyabean imports. President Trump has stated his intention to impose tariffs on European car imports - trade worth $60 billion- to get the EU to offer concessions.  ...

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The lack of reliable statistics and production information for China's steel industry. The World Steel Association says China's steel production went up by 7.5% in April 2011 over the prior year. In 2010 it says China produced 625 million metric tons. These figures are based on information from the China Iron and Steel Association, which represents 75% of steel producers in the country. Because much of the reporting is voluntary many smaller producers do not report their production figures. MEPS, a steel consulting firm in the U.K. , says there is extensive underreporting because of political pressure on inefficient mills to shut down. These mills continue to operate but fail to report production, as a result production may be understated by 45 million tons, according to MEPS. This becomes important because if the Chinese economy slows down much of the steel warehoused in China because of higher taxes on raw steel exports could end up being exported. Inventory levels are higher in China because of the taxes and the storing of steel by mills slated for closure but still operating. This would cause a drop in steel prices on world markets. Steel is different from other commodities in that it is not traded on the London Metals Exchange or other Exchanges. Sales are privately negotiated sales between steel mills and users such as auto plants....

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See the World Economic Outlook November 2007 which talks about this phenomenon in Chapter 5 on the moderating influences in the global economic cycle, the drop in volatility in the global economy, and the expansion of the economy being across most countries in the global economy. Is this a period or a phase the global economy is going through as most emerging economies and developing countries are improving living standards and developing infrastructure, or will it last for several decades with broad sustained economic growth and foreign trade. Some smaller crises are to be expected for example the stock bubbles in China and India(?) will pop if this bubble phenomena continues in these countries. The pressures for expression of public opinion and environmental degradation in China are further challenges and at some point China's development might slow to a more sustainable longer term rate. Will India then pick up as it urbanizes and develops its manufacturing industry?

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The global financial crisis is expected to reshape the direction of globalization. Western finance will be re-regulated. Second as concerns about food security take prominence in countries like India and China inflation and how it affects food prices will result in governments taking an active role in this area. Thirs America will lose economic clout and intellectual authority. Emerging economies like Inida, China, Brazil and Russia and other countries are having a large influence on the direction of global trade now this will also extend to global finance. But even after the re-regulation of finance in western countries and changes also in emerging countries that are seen as necessary in the light of the global crisis, the global economy will still find the model of markets if carefully done and respect for individual initiative with a proper role of government but limited role, he attractive model to follow. Easterly comments on this for developing countries. See the link.

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The glut of steel in China in May 2012 as the economy slows. The prospects for fresh stimulus and infrastructure projects do not look as promising as during the last stimulus efforts in 2009, leading to efforts to increase exports.

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Hit hard by the pandemic the people of Argentina, Brazil, Chile and Mexico are showing less vaccine hesitancy. This is enabling this region to catch up with the US in vaccinations. The difference is that people trust vaccinations. About two thirds of people in Chile and Uruguay are vaccinated. Supplies of vaccine are coming in from US, UK, Russia and China. Brazil is now doing 1.5 million vaccinations a day, compared to 750,000 in US daily. This report says that on a per capita basis taking into account the populations US is currently vaccinating at half the rate of Mexico and a third of the rate in Peru and Colombia, Argentina. With 8% of the population Latin America had one third the deaths making vaccination urgent and essential for this region. People are taking the threat of Delta variant seriously in the region. Astonishing as it may sound after all the publicity of deaths in Brazil this report in WSJ says 88% of people in Brazil want to get vaccinated, while 67% say this in the US, poll from Ipsos. Peru, Argentina, Mexico, Chile all top the US, says WSJ. ...

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Even though immigration makes the headlines for the average German and daily German life polls and surveys show says the NYT that the main concerns center around a failing economy. For 5 years Germany has experienced little growth. According to Eurostat, Germany's GDP growth rate is 2023 -0.2% 2022: 1.37% 2021: 3.67% 2020 -4.1% Tankersley and Eddy report from Lutherstadt Wittenberg Eastern Germany. As Germany's economy slows companies may move jobs and manufacturing to Austria and France says one CEO of a company that makes fertilizer and additives for diesel motors. This could lead to loss of 10,000 jobs in an already depressed region. The problems faced buy German industry are increasing with higher costs of energy- even after prices have come down energy is 20% costlier than the European average according to Eurostat. Industry leaders say this is the result partly of efforts to reduce fossil fuel emissions. Increasing competition from China means Germany cannot compete as before. Investment in public infrastructure has not kept up with crumbling roads and bridges and a rail system with underinvestment and plagued with delays. Investment in digital technology has lagged behind China, India and France.   ...

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In this audio BBC Witness History talks with Shuji Nakamura, the inventor of the LED lightbulb in 1992.  Nakamura shows the resilience and stubborn persistence against the odds that has given the world an extraordinary invention. The LED bulb does great things for climate change action because for example Califonria uses 35% of its electricity for lighting. The LED bulb cuts this in half and this means many coal fired power plants are not needed. In India, Indonesia and China this means lighting for about 3 billion people, with lighting for children studying in remote parts of India and China, and in Africa and Latin America. Nakamura took an unconventional route. He did his PhD in Japan not by going to school which is allowed in Japan, but by writing a paper on White LED development. He made a single minded focus on this goal. Nakamura says it made him angry that no one wanted to try new ideas and he persisted for years of research. At the time GaN research was done by less than one percent of researchers. Nakamura decided to try the path less trodden and by 1992 developed a blue light emitting LED bulb. Add phospor particles and blue becomes bright white LED. ...

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Traditional IPO's have raised $7 billion down a huge 94% from this time last year says this report in the WSJ. IPO of Rivian a new electric car manufacturer in 2021 was priced so high that it made the valuation of the new company at over $70 billion more than that of Ford Motor. Rivian had only made a little over 1000 cars in 2021 and about 7000 cars in the first half of 2021, which shows the size of the excess and the potential waste of capital that could be better allocated to vital needs for the economy such as achieving self reliance in semiconductor chips for the US which is not getting the funding it deserves and needs. These kinds of excesses are now a thing of the past. Larger companies, well known names such as Intel's Mobileye subsidiary or companies with a with a proven track record are now the companies that are more likely to have success with IPO's, as the economic environment, higher interest rates and other changes lead to the withering away of the novel idea startups of the past. Startups that had no meaningful effect on improving people's lives in any significant way, or strengthened the US economy and industrial base, and merely sucked up valuable resources.  It is not that the US lacks the resources to compete effectively with any country in the world including China, in renewables, in semiconductors, in 5G, in new technologies, it is just that hundreds of billions of dollars are going into unproductive channels and wasted. ...

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US president Biden proposes to reduce the US deficit by $2 trillion by increasing taxes on American households worth more than $100 million that would apply to their earned income, and their unrealized gains on liquid assets like stocks. Biden also plans quadrupling the tax on stock buybacks by companies, a tax approved in the Inflation Reduction Act of 2021. The deficit in 2023 will be about $1.4 trillion and rise to about $2 trillion, so that Biden's plan is to practically eliminate the  large deficit if the Republicans come on board. Republicans prefer cuts in spending. US companies have engaged in a dramatic increase in stock buybacks in recent years leading to calls for increasing the tax on stock buybacks. Biden says even high income households will not see an increase in their taxes, only the wealthiest households with over $100 million who have benefited vastly through the Reagan type policies of the last two decades. These households with over $100 million in assets will not be affected in the same way as students, workers, and middle income households are affected in shouldering a large part of the burden of these Reagan type policies that did not adequately fund education, healthcare, and manufacturing in communities across America. This was a period when Democrats in Congress awed by Reagan type policies failed to vigorously oppose policy that increased the US deficit and burden on households for health costs by not allowing Medicare to negotiate prices with pharmaceutical companies. A senior AARP official says that when we talk about the Biden Inflation Reduction Act of 2021 the key component is the Medicare price negotiation with companies that is now law. Why Republicans and Democrats before Mr. Biden allowed such a gross distortion for two decades since 2001 that burdened ordinary  working Americans while neglecting American manufacturing, till Mr. Biden assumed the presidency, says much about the policies of the last two decades and how it has affected ordinary working families. Shriveling factory towns and creating much distress in these communities with these distortions that are a legacy of Reagan type laissez faire policies that government should do little. The result of these policies is that manufacturing is concentrated in only one country for the whole supply chain something that would never have happened with a thoughtful policy planning process. India and Vietnam are only today seen as alternatives for the supply chain in 2023 when policies were in place in these countries since 2014 for the supply chain to be distributed in a way that would be a win-win situation for all countries, avoiding the national security threats of today with overconcentration of manufacturing in China. This has not benefited China or the US because of the rancor and tension it has created. It was the fall of the Berlin Wall that created some of this awe for Reagan, when looking at it objectively it was nothing more than a course correction in Europe after the Hungarian revolution suppressed in 1956, Czech in 1968. It had little to do with what policies the US should pursue for workers and families, just as the war in Ukraine today remains another course correction in a different direction in Europe, and does not affect domestic policy in the US to build a better society for workers and families that Mr. Biden is doing. ...

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All three countries in the South Asian neighborhood now face economic crisis of large proportions - Sri Lanka, Pakistan, and Bangladesh, all turning to the IMF for help. In the case of Sri Lanka there was help from the beginning from India. It was lack of jobs and not enough jobs generated even with a decade of 7% economic growth. It was in protests over job quotas reserved for independence soldiers that led to the ouster of Sheik Hasina's government. This report in NYT shows overdependence on garment exports which generated growth for decades under PM Hasina as having a drawback during Covid. The disruptions in the supply chain during Covid hurt Bangladesh when garment earnings dropped. At one point the industry was closed for months. India provided assistance including vaccines during Covid and India is the largest destination for Bangladesh exports with economic ties to 5 Indian states. The recovery from Covid has not been strong and has led to reduction in foreign exchange reserves. In 2022 Bangladesh turned to the IMF for assistance. Not enough jobs were being created for a large population. In 2000 the population was 129 million, in 2019 before pandemic 165 million. Today in 2024 it is 171 million, increasing by 33% from 2000. By contrast in a communist state Vietnam population increased by 22 million to 99 million or 29% in 2024 from 2000   Foreign exchange reserves dropped during the pandemic to $23 billion in July 2023, in the last 11 months it dropped by $4 billion to $19 billion. By comparison Pakistan's are at $13 billion, up $4 billion in 11 months. Foreign remittances from Bangladeshis overseas are another source of foreign exchange. The major problem of getting tax revenues with people and business not paying taxes due is a problem for Bangladesh and for Pakistan. India has made huge gains through GST and digitization of economy to get tax revenues to support economic growth and infrastructure. And under the leadership of prime minister Modi there is discipline, girt, a strategic focus, with good governance, that is similar to what helped transform Japan and China into industrialized nations. This is missing in Sri Lanka, Pakistan and Bangladesh and in Burma. This gives some idea why in the present budget north and eastern Indian states of Bihar, Orissa, Andhra Pradesh, with a combined population of 230 million people are in a specially designated region for development. It is a gathering momentum against centuries of foreign occupation and neglect similar to that seen in China. ...

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Federal prosecutors are working on a criminal investigation of China's Huawei Technologies Co. for allegedly stealing trade secrets from U.S. business partners. Huawei is the world's second largest maker of smartphones and the largest maker of telecom equipment in the world. One investigation looks at technology used by T-mobile to test smartphones. The Trump administration is aggressively following up on cases of technology transfer by Chinese companies and intellectual property theft.

Another investigation involves technology trade secrets of Micron Technology Inc. The U.S. Justice Department is taking up previous civil lawsuits related to technology theft and bringing up criminal cases.

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U.S. job growth slowed in February to just 20,000 jobs in nonfarm sector following strong gains in December and January. The 3 month average is 186,000 jobs created. Unemployment rate dropped to 3.8%. The figures are watched closely as Europe and China are showing slow growth. The European Central Bank said it will not increase interest rates till 2020 and announced fresh stimulus loans. The U.S. Federal Reserve is not expected to raise rates in the next few months. Economic output growth was 0.5% in the first quarter after 3% growth in 2018. Other reports show labor scarcity with wage growth outpacing inflation. 

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The shift away from Iranian oil with U.S. pressure and sanctions, and higher oil prices, could pose challenges for the Indian macroeconomic outlook in 2020.

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Building extensive subway systems in large cities is the next focus for China's infrastructure building effort. China's prime minister, Li Keqiang supports "new urbanization, with people at the center." Building convenient mass transit for cities with subways and light rail is seen as a way to improve living in urban environments. Other related priorities are water supply, garbage disposal and more sidewalks. Subway lines reaching further into the fringes of cities helps push population out further and lead to less overcrowding and pressures on limited space in core areas of cities This also takes pressure off increasing automobile use inside the centre of cities, reduces overall automobile use in urban areas, and frees up money for consumers to spend on products other than automobiles. This fits in with the plan to urbanize China, by taking pressure off property prices, reducing air pollution from automobile use, and improving quality of life. It is also seen as a way to stimulate economic activity in the fringe areas as subways extend further to outlying urban areas. An example is the $300 million three station line to Kunshan, an extension above ground to Shanghai's subway, which is expected to connect with a line to Suzhou. China's cities have spent about 22% of the total debt of $1.76 trillion in 2010 on transportation infrastructure, according to national audit. The subway and light rail effort is taking place in 26 cities with new or expanding lines, according to the Transportation Technology Development and Planning Research Center. Subways charge much less in China compared to New York- 2 yuan or 30 cents compared to $2.50 base fare in New York city, and will need local government and state subsidies. ...