Tag Archives: JP

World

Medvedev says Japanese PM should disembowel himself

Leave a comment

Jan 14 (Reuters) – Former Russian President Dmitry Medvedev accused Japanese Prime Minister Fumio Kishida on Saturday of shameful subservience to the United States and suggested he should ritually disembowel himself.

It was the latest in a long line of shocking and provocative statements from Medvedev, who was once seen as a Western-leaning reformer but has reinvented himself as an arch-hawk since Russia invaded Ukraine last year.

Speaking at a news conference in Washington on Saturday, a day after a summit with U.S. President Joe Biden on Friday, Kishida made no mention of Medvedev’s comment and was not asked about it.

Japanese officials travelling with Kishida did not immediately respond to requests for comment and in Japan, no one was immediately available for comment on the remarks at either the prime minister’s official residence or the foreign ministry outside normal working hours.

Medvedev is a prominent ally of President Vladimir Putin who serves as deputy chairman of Russia’s Security Council and of a body overseeing the defence industry.

He was responding to a meeting on Friday between Kishida and Biden, after which the two leaders issued a joint statement saying: “We state unequivocally that any use of a nuclear weapon by Russia in Ukraine would be an act of hostility against humanity and unjustifiable in any way.”

On Saturday, Kishida said the G7 summit of major industrialized nations in Hiroshima in May should demonstrate a strong will to uphold international order and rule of law after Russia’s invasion of Ukraine.

Medvedev said the nuclear statement showed “paranoia” towards Russia and “betrayed the memory of hundreds of thousands of Japanese who were burned in the nuclear fire of Hiroshima and Nagasaki” – a reference to the atomic bombs that the United States dropped on Japan to force its surrender at the end of World War Two.

Rather than demanding U.S. repentance for this, Kishida had shown he was “just a service attendant for the Americans”.

He said such shame could only be washed away by committing seppuku – a form of suicide by disembowelment, also known as hara-kiri – at a meeting of the Japanese cabinet after Kishida’s return.

Since Russia’s invasion of Ukraine, Medvedev has warned repeatedly that Western meddling in the crisis could lead to nuclear war, and has referred to Ukrainians as “cockroaches” in language Kyiv says is openly genocidal.

Putin has said that the risk of a nuclear war is rising but insisted Russia has not “gone mad” and that it sees its own nuclear arsenal as a purely defensive deterrent.

Reporting by Reuters
Editing by Frances Kerry and Diane Craft

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

World

U.S. strongly committed to Japan defense, Biden tells Kishida, hails military boost

Leave a comment

WASHINGTON, Jan 13 (Reuters) – President Joe Biden told Japanese Prime Minister Fumio Kishida on Friday the United States was “fully, thoroughly, completely” committed Japan’s defense and praised Tokyo’s security build up, saying the nations had never been closer.

Kishida is in Washington on the last stop in a tour of the G7 industrial powers and has been seeking to bolster long-standing alliances amid rising concern in Japan, and the United States, about mounting regional security threats from China, North Korea and Russia.

In a meeting at the White House, Biden called it a “remarkable moment” in the U.S.-Japan alliance. He said the two countries had never been closer.

“Let me be crystal clear: The United States is fully, thoroughly, completely committed to the alliance, and importantly … to the defense of Japan,” he said, while also thanking Kishida for strong leadership in working closely on technology and economic issues.

“We are modernizing our military alliances, building on Japan’s historic increase in defense spending, and new national security strategy,” Biden said.

Kishida thanked Biden for U.S. work on regional security and said: “Japan and the United States are currently facing the most challenging and complex security environment in recent history.” He said Tokyo had formulated its new defense strategy released last month “to ensure peace and prosperity in the region.”

He said the two countries shared fundamental values of democracy and the rule of law “and the role that we are to play is becoming even greater.”

Kishida said he looked forward to a “candid” exchange of views on issues including “a free and open Indo-Pacific” – language the two sides use to describe efforts to push back against China – the G7, which Japan’s currently chairs, and climate change.

In a later speech at Washington’s Johns Hopkins School of Advanced International Studies, Kishida called China the “central challenge” for both Japan and the United States and said they and Europe must act in unison in dealing with the country.

DRAMATIC MILITARY CHANGE

Japan last month announced its biggest military build-up since World War Two – a dramatic departure from seven decades of pacifism, largely fueled by concerns about Chinese actions in the region.

“Biden commended Japan’s bold leadership in fundamentally reinforcing its defense capabilities and strengthening diplomatic efforts,” according to a joint U.S.-Japan statement issued after the meeting.

U.S. and Japanese foreign and defense ministers met on Wednesday and announced increased security cooperation following nearly two years of talks and the U.S. officials praised Tokyo’s military buildup plans.

[1/5] U.S. President Joe Biden and Japanese Prime Minister Fumio Kishida walk through the colonnade on their way to the Oval Office at the White House in Washington, U.S., January 13, 2023. T.J. Kirkpatrick/Pool via REUTERS

Japan’s military reform plan will see it double defense spending to 2% of GDP and procure missiles that can strike ships or land-based targets 1,000 km (600 miles) away.

Before the meeting, a senior U.S. official said Biden and Kishida were expected to discuss security issues and the global economy and that their talks are likely to include control of semiconductor-related exports to China after Washington announced strict curbs last year.

SEMICONDUCTORS

The joint statement said the United States and Japan “will sharpen our shared edge on economic security, including protection and promotion of critical and emerging technologies, including semiconductors.”

Kishida, Japan’s Foreign Minister Hayashi and U.S. Secretary of State Antony Blinken later signed an agreement on peaceful space exploration at NASA’s headquarters in Washington.

Blinken said this would take space cooperation “to new heights” and strengthen the partnership in areas including research into space technology and transportation, robotic lunar surface missions, climate-related missions, and “our shared ambition to see a Japanese astronaut on the lunar surface.”

At the ceremony, Kishida said the U.S.-Japan alliance was “stronger than ever.”

As well as chairing the G7, Japan took up a two-year term on the U.N. Security Council on Jan. 1 and holds the rotating monthly presidency of the 15-member body for January.

Kishida has said he backs Biden’s attempt to limit China’s access to advanced semiconductors with export restrictions. Still, he has not agreed to match sweeping curbs on exports of chip-manufacturing equipment that Washington imposed in October.

The U.S. official said Washington was working closely with Japan on the issue and believes they share a similar vision even if their legal structures are different. He said the more countries and significant players that backed the controls, the more effective they would be.

A Japanese official said economic security, including semiconductors, was likely to be discussed, but that no announcement was expected on that from the meeting.

Biden and Kishida committed to “strengthening vital trilateral cooperation” among the United States, Japan and South Korea, said the joint statement, which follows North Korea’s decision to exponentially increase its nuclear force and codify its right to a first strike.

Kishida’s visit follows one by Biden to Tokyo in May and a meeting between the two at a November regional summit in Cambodia.

(This story has been refiled to delete the extra word ‘defense’ in paragraph 1)

Reporting by Jeff Mason, Andrea Shalal, David Brunnstrom, Michael Martina, Tim Ahmann and Eric Beech; Editing by Don Durfee, Alistair Bell and Grant McCool

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

World

China COVID peak to last 2-3 months, hit rural areas next -expert

Leave a comment

  • Peak of COVID wave seen lasting 2-3 months – epidemiologist
  • Elderly in rural areas particularly at risk
  • People mobility indicators tick up, but yet to fully recover

BEIJING, Jan 13 (Reuters) – The peak of China’s COVID-19 wave is expected to last two to three months, and will soon swell over the vast countryside where medical resources are relatively scarce, a top Chinese epidemiologist has said.

Infections are expected to surge in rural areas as hundreds of millions travel to their home towns for the Lunar New Year holidays, which officially start from Jan. 21, known before the pandemic as the world’s largest annual migration of people.

China last month abruptly abandoned the strict anti-virus regime of mass lockdowns that fuelled historic protests across the country in late November, and finally reopened its borders this past Sunday.

The abrupt dismantling of restrictions has unleashed the virus onto China’s 1.4 billion people, more than a third of whom live in regions where infections are already past their peak, according to state media.

But the worst of the outbreak was not yet over, warned Zeng Guang, the former chief epidemiologist at the Chinese Center for Disease Control and Prevention, according to a report published in local media outlet Caixin on Thursday.

“Our priority focus has been on the large cities. It is time to focus on rural areas,” Zeng was quoted as saying.

He said a large number of people in the countryside, where medical facilities are relatively poor, are being left behind, including the elderly, the sick and the disabled.

Authorities have said they were making efforts to improve supplies of antivirals across the country. Merck & Co’s (MRK.N) molnupiravir was made available in China from Friday.

The World Health Organization this week also warned of the risks stemming from holiday travelling.

The UN agency said China was heavily under-reporting deaths from COVID, although it is now providing more information on its outbreak.

“Since the outbreak of the epidemic, China has shared relevant information and data with the international community in an open, transparent and responsible manner,” foreign ministry official Wu Xi told reporters.

Health authorities have been reporting five or fewer deaths a day over the past month, numbers which are inconsistent with the long queues seen at funeral homes and the body bags seen coming out of crowded hospitals.

China has not reported COVID fatalities data since Monday. Officials said in December they planned to issue monthly, rather than daily updates, going forward.

Although international health experts have predicted at least 1 million COVID-related deaths this year, China has reported just over 5,000 since the pandemic began, one of the lowest death rates in the world.

DIPLOMATIC TENSIONS

Concerns over data transparency were among the factors that prompted more than a dozen countries to demand pre-departure COVID tests from travellers arriving from China.

Beijing, which had shut its borders from the rest of the world for three years and still demands all visitors get tested before their trip, objects to the curbs.

Wu said accusations by individual countries were “completely unreasonable, unscientific and unfounded.”

Tensions escalated this week with South Korea and Japan, with China retaliating by suspending short-term visas for their nationals. The two countries also limit flights, test travellers from China on arrival, and quarantine the positive ones.

Japan’s Chief Cabinet Secretary Hirokazu Matsuno said on Friday Tokyo will continue to demand transparency, labelling Beijing’s retaliation as extremely “regrettable.”

Parts of China were returning to normal life.

In the bigger cities in particular, residents are increasingly on the move, pointing to a gradual, though so far slow, rebound in consumption and economic activity.

An immigration official said on Friday 490,000 daily trips on average were made in and out of China since it reopened on Jan. 8, only 26% of the pre-pandemic levels.

Singapore-based Chu Wenhong was among those who finally got reunited with their parents for the first time in three years.

“They both got COVID, and are quite old. I feel quite lucky actually, as it wasn’t too serious for them, but their health is not very good,” she said.

CAUTION

While China’s reopening has given a boost to financial assets globally, policymakers around the world worry it may revive inflationary pressures.

However, December’s trade data released on Friday provided reasons to be cautious about China’s recovery pace.

Jin Chaofeng, whose company exports outdoor rattan furniture, said he has no expansion or hiring plans for 2023.

“With the lifting of COVID curbs, domestic demand is expected to improve but not exports,” he said.

Data next week is expected to show China’s economy grew just 2.8% in 2022, its second-slowest since 1976, the final year of Mao Zedong’s decade-long Cultural Revolution, according to a Reuters poll.

Some analysts say last year’s lockdowns will leave permanent scars on China, including by worsening its already bleak demographic outlook.

Growth is then seen rebounding to 4.9% this year, still well below the pre-pandemic trend.

Additional reporting by the Beijing and Shanghai newsrooms; Writing by Marius Zaharia; Editing by Raju Gopalakrishnan

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

Business

Tesla slashes prices in U.S., Europe to drive demand

Leave a comment

  • Tesla cuts prices in U.S., Europe by up to 20%
  • Move follows price cuts across Asia last week
  • Some models now qualify for U.S. tax credits
  • Model 3 price in Germany in line with Volkswagen’s ID.3

Jan 13 (Reuters) – Tesla (TSLA.O) has slashed prices on its electric vehicles in the United States and Europe by as much as 20%, extending a strategy of aggressive discounting after missing Wall Street estimates for 2022 deliveries.

The move, which prompted a 3.8% fall in Tesla’s shares in Frankfurt, came after CEO Elon Musk warned that the prospect of recession and higher interest rates meant it could lower vehicle pricing to sustain volume growth at the expense of profit.

The lower pricing across Tesla’s major markets marks a reversal from the strategy the automaker had pursued through much of 2021 and 2022 when orders for new vehicles exceeded supply. Musk acknowledged last year that prices had become “embarrassingly high” and could hurt demand.

The U.S. price cuts, announced late Thursday in U.S. time on the Model 3 sedan and Model Y crossover SUV, ranged between 6% and 20% compared with prices before the discount, according to Reuters calculations.

That is before an up to $7,500 federal tax credit that took effect for many electric vehicle models at the start of January.

Following is a table of the price cuts by model in Germany and the United States:

Reuters Graphics

Tesla also cut prices for its Model X luxury crossover SUV and Model S sedan in the United States.

In Germany, it cut prices on the Model 3 and the Model Y – its global top-sellers – by between about 1% and almost 17% depending on the configuration. It also cut prices in Austria, Switzerland and France.

For a U.S. buyer of the long-range Model Y, the new Tesla price combined with the U.S. subsidy that took effect this month amounts to a discount of 31%. In addition, the Tesla move broadened the vehicles in its line-up eligible for the Biden administration tax credit.

Before the price cut, the five-seat version of the Model Y had been ineligible for that credit, a designation Musk had called “messed up”. After the price cut, the long-range version of the Model Y will qualify for the $7,500 federal credit.

“This should really boost 2023 (Tesla) volumes,” Gary Black, a Tesla investor who has remained bullish on the company and its prospects through the recent, sharp share price decline, said in a tweet. “It’s the right move.”

Still, some users on Tesla fan forums online complained the price cuts disadvantaged customers who had recently bought their vehicle, leaving them with a lower-valued item on the second-hand car market.

“I’m not very pleased with these huge price sways. Just reducing 10,000 euros like that – definitely makes you feel that you just paid far too much,” one user wrote on a ‘Tesla Drivers and Friends’ forum on Friday.

In China, where Tesla cut prices last week by 6-13.5%, owners protested at delivery centres across the country, pressing Tesla for compensation.

Before the price cut, Tesla inventory in the United States, as tracked by the models its website shows as immediately available, had been trending higher. Prices on used Tesla models had also been declining, increasing the pressure on it to adjust new-car sticker prices.

For 2021, the United States and China combined had accounted for about 75% of Tesla sales, although the automaker has been growing sales in Europe, where its Berlin factory has been ramping up production.

Reuters Graphics

NEW SALES LEADERSHIP

The shift is the first major move by Tesla since appointing its lead executive for China and Asia, Tom Zhu, to oversee U.S. output and sales.

Tesla cut prices in China and other Asian markets last week. Along with previous price cuts announced in October and recent incentives, the Chinese price for a Model 3 or Model Y was down 13% to 24% from September after the recent move, Reuters calculations showed.

Tesla has also cut prices in South Korea, Japan, Australia and Singapore.

Analysts had said the Chinese price cuts would boost demand and increase pressure on its rivals there, including BYD (002594.SZ), to follow suit in what could become a price war in the largest single market for electric vehicles.

That pressure could be building in Europe as well.

Tesla’s Model 3 was the best-selling electric vehicle in Germany last month, followed by the Model Y, beating Volkswagen’s (VOWG_p.DE) all-electric ID.4. Volkswagen recently raised the price of its entry-level ID.3, putting it at parity with the now-discounted Model 3.

Tesla missed Wall Street estimates for fourth quarter deliveries. Full year growth in deliveries was 40% – also short of Musk’s own forecast of 50%.

Tesla shares under pressure

Reporting by Zhang Yan in Shanghai, Hyunjoo Jin in Seoul, Victoria Waldersee in Berlin; Writing by Kevin Krolicki in Singapore; Editing by Lincoln Feast, Kenneth Maxwell, Mark Potter and Alexander Smith

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

World

Chinese fret over elderly as WHO warns of holiday COVID surge

Leave a comment

  • Two billion trips expected over Lunar New Year
  • Virus spreading from cities to vulnerable villages
  • WHO says China response challenged by lack of data
  • China’s grand reopening marred by Japan, Korea spat

BEIJING, Jan 12 (Reuters) – People in China worried on Thursday about spreading COVID-19 to aged relatives as they planned returns to their home towns for holidays that the World Health Organization warns could inflame a raging outbreak.

The Lunar New Year holiday, which officially starts on Jan. 21, comes after China last month abandoned a strict anti-virus regime of mass lockdowns that prompted widespread frustration and boiled over into historic protests.

That abrupt U-turn unleashed COVID on a population of 1.4 billion which lacks natural immunity, having been shielded from the virus since it first erupted in late 2019, and includes many elderly who are not fully vaccinated.

The outbreak spreading from China’s mega-cities to rural areas with weaker medical resources is overwhelming some hospitals and crematoriums.

With scant official data from China, the WHO on Wednesday said it would be challenging to manage the virus over a holiday period considered the world’s largest annual migration of people.

Other warnings from top Chinese health experts for people to avoid aged relatives during the holidays shot to the most-read item on China’s Twitter-like Weibo on Thursday.

“This is a very pertinent suggestion, return to the home town … or put the health of the elderly first,” wrote one user. Another user said they did not dare visit their grandmother and would leave gifts for her on the doorstep.

“This is almost the New Year and I’m afraid that she will be lonely,” the user wrote.

More than two billion trips are expected across China over the broader Lunar New Year period, which started on Jan. 7 and runs for 40 days, according to the transport ministry. That is double last year’s trips and 70% of those seen in 2019 before the pandemic emerged in the central Chinese city of Wuhan.

“I will stay at home and avoid going to very crowded places,” said Chen, a 27-year-old documentary filmmaker in Beijing who plans to visit her home town in the eastern province of Zhejiang.

Chen said she would disinfect her hands before meeting elderly relatives, such as her grandmother, who has managed to avoid infection.

LACK OF DATA CRITICISED

The WHO and foreign governments have criticised China for not being forthright about the scale and severity of its outbreak, which has led several countries to impose restrictions on Chinese travellers.

China has been reporting five or fewer deaths a day over the past month, numbers that are inconsistent with the long queues seen at funeral homes. The country did not report COVID deaths data on Tuesday and Wednesday.

Liang Wannian, the head of a COVID expert panel under the national health authority, told reporters that deaths could only be accurately counted after the pandemic was over.

Although international health experts have predicted at least a million COVID-related deaths this year, China has reported just over 5,000 since the pandemic began, a fraction of what other countries have reported as they removed restrictions.

Looking beyond the death toll, investors are betting that China’s reopening will reinvigorate a $17 trillion economy suffering its lowest growth in nearly half a century.

That has lifted Asian stocks to a seven-month peak, strengthened China’s yuan currency against the U.S. dollar and bolstered global oil prices on hopes of fresh demand from the world’s top importer.

China’s growth is likely to rebound to 4.9% in 2023, according to a Reuters poll of economists released on Thursday. GDP likely grew just 2.8% in 2022 as lockdowns weighed on activity and confidence, according to the poll, braking sharply from 8.4% growth in 2021.

TRAVEL CHALLENGES

After three years of isolation from the outside world, China on Sunday dropped quarantine mandates for inbound visitors in a move expected to eventually also stimulate outbound travel.

But concerns about China’s outbreak has prompted more than a dozen countries to demand negative COVID test results from people arriving from China.

Among them, South Korea and Japan have also limited flights and require tests on arrival, with passengers showing up as positive being sent to quarantine.

In a deepening spat between the regional rivals, China has in turn stopped issuing short-term visas and suspended transit visa exemptions for South Korean and Japanese nationals.

Despite Beijing’s lifting of travel curbs, outbound flight bookings from China were at only 15% of pre-pandemic levels in the week after the country announced it would reopen its borders, travel data firm ForwardKeys said on Thursday.

Low airline capacity, high air fares, new pre-flight COVID-19 testing requirements by many countries and a backlog of passport and visa applications pose challenges as the industry looks to recovery, ForwardKeys Vice President Insights Olivier Ponti said in a statement.

Hong Kong Airlines on Thursday said it does not expect to return to capacity until mid-2024.

Reporting by Bernard Orr, Liz Lee, Eduardo Baptista and Jing Wang in Beijing; Writing by John Geddie; Editing by Lincoln Feast and Nick Macfie

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

Business

Stocks hold on to gains ahead of U.S. inflation test

Leave a comment

  • World stocks inch higher; dollar near 7-month lows
  • Yen gains on report BOJ to scrutinise policy effects
  • Eyes on U.S. CPI due at 1330 GMT
  • Treasuries and euro zone bonds add to gains

MILAN, Jan 12 (Reuters) – World stocks held on to modest gains on Thursday on cautious optimism that U.S. data will confirm inflation is softening, while the yen rose with a report Japan will this month review the side-effects of its ultra-easy policy.

A MSCI gauge of world stocks (.MIWD00000PUS) rose 0.2% to a four-week high by 0831 GMT ahead of core U.S. consumer price inflation, (USCPFY=ECI) which are expected to have slowed to an annual 5.7% in December, from 6% a month earlier. Month-on-month headline inflation is seen at zero (USCPI=ECI).

Bonds held gains, also mirroring hopes of a softer inflation print, and the U.S. dollar was near a seven-month low against a basket of currencies. Europe’s STOXX 600 (.STOXX) equity benchmark index rose 0.4% to its highest since April 2022.

The data due at 1330 GMT is set to have a big impact on markets by shaping expectations of the speed of interest rate hikes in the world’s biggest economy. Markets have priced better-than-even odds that the Federal Reserve raises rates by 25 basis points, rather than 50, at February’s meeting.

“Both the worst and best days for the S&P 500 in 2022 came on days of a CPI release. As such, it’s inevitable that today’s U.S. CPI has the ability to shape the next month,” wrote Deutsche Bank strategist Jim Reid.

“The latest releases have seen two downside surprises on CPI in a row for the first time since the pandemic, which has led to growing hopes that the Fed might achieve a soft landing after all,” he added.

The MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) rose 0.1% after climbing to a seven-month high, while Japan’s Nikkei (.N225) was steady.

S&P 500 futures were broadly steady following gains for Wall Street indexes on Wednesday. Boston Federal Reserve bank leader Susan Collins told the New York Times that she was leaning towards a 25 basis point hike.

Optimism for a more benign rates outlook and a pickup in demand as China emerges from strict COVID restrictions kept oil prices near one-week peaks.

Brent crude futures topped $83 on Thursday before retreating slightly to trade flat on the day at 82.67 a barrel.

U.S. Treasuries added a little to Wednesday’s gains, sending benchmark 10-year yields down 4.4 basis points (bps) to 3.514%. German 10-year yields , the benchmark for the euro zone, fell 7 bps to 3.509%.

CHINA HOPES

Along with hopes that Western central banks will be gentler, investors are also banking on a recovery in China to help global growth, and are eyeing a potential policy shift in Japan.

The Bank of Japan stunned markets last month by widening the band around its 10-year bond yield target, a move that triggered a sudden rise in yields and a jump in the yen.

On Thursday. Japan’s Yomiuri newspaper reported the BOJ will review the side-effects of Japan’s ultra-easy settings sooner than expected – at next week’s policy meetings – and that it may take additional steps to correct distortions in the yield curve.

The yen rose as much as 0.9% and was last at 131.75 per dollar. Ten-year Japanese government bond futures fell to almost eight-year lows.

Foreign exchange markets elsewhere were holding their breath ahead of the U.S. CPI data while China’s reopening kept a bid under Asia’s currencies. The dollar index added 0.1% to 103.23, not far off a seven-month low of 102.93 hit this week. The yuan traded near five-month highs at 6.7555 per dollar.

China on Thursday reported consumer price falls in December and a larger-than-expected drop in factory gate prices – underscoring weakness in demand – which investors are betting will recover over the coming months.

“It’s not enough for China to come out of COVID to really turn the whole world economy around,” said Steven Wieting, chief investment strategist and chief economist at Citi Global Wealth Investments. “But it really weighs in the opposite direction.”

Reporting by Danilo Masoni in Milan and Tom Westbrook in Singapore

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

Business

Failed crypto exchange FTX has recovered over $5 bln, attorney says

Leave a comment

  • FTX valued a year ago at $32 bln
  • Over $8 billion in FTX customer funds missing
  • Plan to sell FTX affiliates presented in court

NEW YORK/WILMINGTON, Del., Jan 11 (Reuters) – Crypto exchange FTX has recovered more than $5 billion in liquid assets but the extent of customer losses in the collapse of the company founded by Sam Bankman-Fried is still unknown, an attorney for the company told a U.S. bankruptcy court on Wednesday.

The company, which was valued a year ago at $32 billion, filed for bankruptcy protection in November and U.S. prosecutors accused Bankman-Fried of orchestrating an “epic” fraud that may have cost investors, customers and lenders billions of dollars.

“We have located over $5 billion of cash, liquid cryptocurrency and liquid investment securities,” Andy Dietderich, an attorney for FTX, told U.S. Bankruptcy Judge John Dorsey in Delaware at the start of Wednesday’s hearing.

Dietderich also said the company plans to sell nonstrategic investments that had a book value of $4.6 billion.

However, Dietderich said the legal team is still working to create accurate internal records and the actual customer shortfall remains unknown. The U.S. Commodities Futures Trading Commission has estimated missing customer funds at more than $8 billion.

Dietderich said the $5 billion recovered does not include assets seized by the Securities Commission of the Bahamas, where the company was headquartered and Bankman-Fried resided.

FTX’s attorney estimated the seized assets were worth as little as $170 million while Bahamian authorities put the figure as high as $3.5 billion. The seized assets are largely comprised of FTX’s proprietary and illiquid FTT token, which is highly volatile in price, Dietderich said.

ASSET SALES

FTX could raise additional funds in the coming months for the benefit of customers after Dorsey approved FTX’s request for procedures to explore sales of affiliates at Wednesday’s hearing.

The affiliates — LedgerX, Embed, FTX Japan and FTX Europe — are relatively independent from the broader FTX group, and each has its own segregated customer accounts and separate management teams, according to FTX court filings.

The crypto exchange has said it is not committed to selling any of the companies, but that it received dozens of unsolicited offers and plans to hold auctions beginning next month.

The U.S. Trustee, a government bankruptcy watchdog, opposed selling the affiliates before the extent of the alleged FTX fraud is fully investigated.

In part to preserve the value of its businesses, FTX also sought Dorsey’s approval to keep secret 9 million FTX customer names. The company has said that privacy is needed to prevent rivals from poaching users but also to prevent identity theft and to comply with privacy laws.

Dorsey allowed the names to remain under wraps for only three months, not six months as FTX wanted.

“The difficulty here is that I don’t know who’s a customer and who’s not,” Dorsey said. He set a hearing for Jan. 20 to discuss how FTX will distinguish between customers and said he wants FTX to return in three months to give more explanation on the risk of identity theft if customer names are made public.

Media companies and the U.S. Trustee had argued that U.S. bankruptcy law requires disclosure of creditor details to ensure transparency and fairness.

In addition to selling affiliates, a company lawyer on Wednesday said FTX will end its 19-year $135 million sponsorship deal with the NBA’s Miami Heat and a 7-year about $89 million deal with the League of Legends video game.

FTX’s founder, Bankman-Fried, 30, was indicted on two counts of wire fraud and six conspiracy counts last month in Manhattan federal court for allegedly stealing customer deposits to pay debts from his hedge fund, Alameda Research, and lying to equity investors about FTX’s financial condition. He has pleaded not guilty.

Bankman-Fried has acknowledged shortcomings in FTX’s risk management practices, but the one-time billionaire has said he does not believe he is criminally liable.

In addition to customer funds lost, the collapse of the company has also likely wiped out equity investors.

Some of those investors were disclosed in a Monday court filing, including American football star Tom Brady, Brady’s former wife supermodel Gisele Bündchen and New England Patriots owner Robert Kraft.

Reporting by Dietrich Knauth in New York and Tom Hals in Wilmington, Del.; Editing by Alexia Garamfalvi, Mark Porter, Matthew Lewis and Anna Driver

Our Standards: The Thomson Reuters Trust Principles.

Tom Hals

Thomson Reuters

Award-winning reporter with more than two decades of experience in international news, focusing on high-stakes legal battles over everything from government policy to corporate dealmaking.

Read original article here

World

China imposes transit curbs for S.Korea, Japan in growing COVID spat

Leave a comment

  • New curbs for S.Korea, Japan nationals transiting China
  • China says visa suspensions for S.Korea, Japan “reasonable”
  • Escalating diplomatic spat may complicate economic relations
  • Social media users lash out at S.Korea’s “insulting” COVID curbs

BEIJING, Jan 11 (Reuters) – China introduced transit curbs for South Korean and Japanese nationals on Wednesday, in an escalating diplomatic spat over COVID-19 curbs that is marring the grand re-opening of the world’s second-largest economy after three years of isolation.

China removed quarantine mandates for inbound travellers on Sunday, one of the last vestiges of the world’s strictest regime of COVID restrictions, which Beijing abruptly began dismantling in early December after historic protests.

But worries over the scale and impact of the outbreak in China, where the virus is spreading unchecked, have prompted more than a dozen countries to demand negative COVID test results from people arriving from China.

Among them, South Korea and Japan have also limited flights and require tests on arrival, with passengers showing up as positive being sent to quarantine. In South Korea, quarantine is at the traveller’s own cost.

In response, the Chinese embassies in Seoul and Tokyo said on Tuesday they had suspended issuing short-term visas for travellers to China, with the foreign ministry slamming the testing requirements as “discriminatory.”

That prompted an official protest from Japan to China, while South Korean foreign minister Park Jin said that Seoul’s decision was based on scientific evidence, not discriminatory and that China’s countermeasures were “deeply regrettable.”

In a sign of escalating tensions on Wednesday, China’s immigration authority suspended its transit visa exemptions for South Koreans and Japanese.

The spat may affect economic relations between the three neighbours as well.

Japanese department store operator Isetan Mitsukoshi Holdings Ltd (3099.T) and supermarket operator Aeon Co (8267.T) said they may have to rethink personnel transfers to China depending on how long the suspension lasts.

“We won’t be able to make short-term business trips, but such trips had dwindled during COVID anyway, so we don’t expect an immediate impact. But if the situation lasts long, there will be an effect,” said a South Korean chip industry source who declined to be identified, as the person was not authorised to speak to media.

China requires negative test results from visitors from all countries.

COUNTING DEATHS

Some of the governments that announced curbs on travellers from China cited concerns over Beijing’s data transparency.

The World Health Organization has said China was underreporting deaths.

China’s health authorities have been reporting five or fewer deaths a day over the past month, numbers that are inconsistent with the long queues seen at funeral homes. In a first, they did not report COVID fatalities data on Tuesday.

China’s Center for Disease Control and Prevention and the National Health Commission did not immediately respond to requests for comment.

Without mentioning whether daily reporting had been discontinued, Liang Wannian, head of a COVID expert panel under the national health authority, told reporters deaths can only be accurately counted after the pandemic is over.

China should ultimately determine death figures by looking at excess mortality, Wang Guiqiang, the head of the infectious diseases department at Peking University First Hospital said at the same news conference.

Although international health experts have predicted at least one million COVID-related deaths this year, China has reported just over 5,000 since the pandemic began, a fraction of what other countries have reported as they reopened.

China says it has been transparent with its data.

State media said the COVID wave was already past its peak in the provinces of Henan, Jiangsu, Zhejiang, Guangdong, Sichuan and Hainan, as well as in the large cities of Beijing and Chongqing – home to more than 500 million people combined.

‘INSULTING’

On Wednesday, Chinese state media devoted extensive coverage of what they called as “discriminatory” border rules in South Korea and Japan.

Nationalist tabloid Global Times defended Beijing’s retaliation as a “direct and reasonable response to protect its own legitimate interests, particularly after some countries are continuing hyping up China’s epidemic situation by putting travel restrictions for political manipulation.”

Chinese social media anger mainly targeted South Korea, whose border measures are the strictest among the countries that announced new rules.

Videos circulating online showed special lanes coordinated by soldiers in uniform for arrivals from China at the airport, with travellers given yellow lanyards with QR codes for processing test results.

One user of China’s Twitter-like Weibo said singling out Chinese travellers was “insulting” and akin to “people treated as criminals and paraded on the streets.”

Annual spending by Chinese tourists abroad reached $250 billion before the pandemic, with South Korea and Japan among the top shopping destinations.

Repeated lockdowns have hammered China’s $17 trillion economy. The World Bank estimated its 2022 growth slumped to 2.7%, its second-slowest pace since the mid-1970s after 2020.

It predicted a rebound to 4.3% for 2023, but that is 0.9 percentage points below its June forecast because of the severity of COVID disruptions and weakening external demand.

($1 = 6.7666 Chinese yuan renminbi)

Additional reporting by Beijing Newsroom; Kaori Kaneko, Mari Shiraki and Elaine Lies in Tokyo; Joyce Lee, Hyunsu Yim and Heekyong Yang in Seoul
Writing by Marius Zaharia; Editing by Gerry Doyle and Kim Coghill

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

Business

Global shares retreat after Fed inflation nudge

Leave a comment

LONDON, Jan 10 (Reuters) – Global shares fell for the first time in three days on Tuesday, after comments from two Federal Reserve officials injected a note of caution over the U.S. rate outlook, knocking equities, commodities and other risk assets.

The MSCI All-World index (.MIWD00000PUS) fell 0.2%, but remained in sight of Monday’s three-week high, while the dollar – a gauge of investor risk appetite – edged up against a basket of major currencies.

In the past six weeks, China has dismantled its zero-COVID policy even as cases have surged around the country, which has given markets a bumpy ride as investors weighed up the economic benefits of reopening against the impact to activity from the wave of infections.

Adding to that has been a sense of optimism that inflation has peaked, especially in the United States, and, as such, the Fed will not have to raise rates as much as many had feared.

However, with consumer price pressures still well above the central bank’s target of 2%, two Fed officials on Monday issued a stark reminder that interest rates will have to keep rising, no matter what investors have priced in.

“The market is trying to get one step ahead of the Fed, but it’s not actually listening to what it’s saying. And the Fed is being quite clear with its message – that rates are going to push higher and they’re going to stay higher for longer,” CityIndex strategist Fiona Cincotta said.

“If we look at expectations of inflation later this week – the big focus – core inflation is still expected to remain high. It doesn’t matter which way you look at it. It’s still higher than the target the Fed is aiming for,” she said.

U.S. consumer price data, due on Thursday, is expected to show headline inflation slowed to 6.5% in December from 7.1% in November.

The data could be key to setting expectations for what happens with rates at the Fed’s next policy meeting and beyond.

San Francisco Fed President Mary Daly told the Wall Street Journal she would pay close attention to Thursday’s data and both 25- and 50-basis point hikes were options for her. Atlanta Fed President Raphael Bostic said his “base case” was for no rate cuts this year or next.

“The main theme overnight was cautiousness in the equity space as stocks pared gains after hawkish comments from two Fed officials. Raphael Bostic and Mary Daly said the Fed would likely hike (interest) rates to above 5% and hold them there for some time,” Commerzbank said in a note.

Fed Chair Jerome Powell addresses a conference on central bank independence later on Tuesday and investors will likely scour his remarks for any signal on monetary policy.

“Given that the recent rebound in equity markets and fall in bond yields and the US dollar is loosening financial conditions, today might offer an opportunity for Fed chairman Jay Powell to reset the narrative slightly,” CMC Markets chief strategist Michael Hewson said.

FRAGILE CHINA

In Europe, the STOXX 600 (.STOXX), which on Monday hit its highest in eight months, fell 0.7%, led by a decline in industrials. London’s FTSE 100 (.FTSE) lost 0.2%, while Frankfurt’s DAX (.GDAXI) fell 0.5%.

U.S. stock index futures , fell 0.3%, indicating Wall Street could open a touch lower after a volatile session the previous day.

The dollar carved out gains against the Australian dollar , which is highly sensitive to the Chinese economy and has gained 3.5% in the last three weeks alone, based on the optimism around reopening.

The Aussie was last down 0.5% at $0.6877, while the offshore yuan lost 0.1% against the dollar to trade around 6.7913. It reached its strongest level since mid-August the previous day.

The dollar index rose 0.2%. The euro was flat, while the pound fell 0.3%. The yen fell 0.1% against the dollar to 132.06, even after data showed a faster pick-up in Tokyo inflation that could prompt the Bank of Japan to tighten monetary policy more quickly.

Strategists at BlackRock, the world’s largest asset manager, on Tuesday said they expected the Chinese economy to grow by 6% this year, which should cushion the global slowdown as recession hits developed-market economies. But any bounce may be fleeting.

“We don’t expect the level of economic activity in China to return to its pre-COVID trend, even as domestic activity restarts. We see growth falling back once the restart runs its course,” Wei Li, who is global chief investment strategist for the BlackRock Investment Institute, wrote in a note.

Copper eased back from six-month highs , as bullishness from China’s emergence from COVID-19 was offset by concern about the risks of a broader global downturn.

London Metal Exchange copper futures fell 0.5% to $8,813 a tonne, having hit their highest in over six months on Monday, while zinc fell 0.7% and lead dropped 2%.

Oil pared earlier losses, but concern persisted that China returning to more normal activity may not translate into a boom in energy demand.

“The social vitality of major Chinese cities is rapidly recovering, and the restart of China’s demand is worth looking forward to. However, considering that the recovery of consumption is still at the expected stage, the oil price will most likely remain low and range-bound,” analysts from Haitong Futures said.

Brent crude futures were last up 0.4% to $80.00 a barrel. The oil price is about 2.3% below where it was a year ago and 45% below the highs around $139 after Russia invaded Ukraine last February.

Additional reporting by Selena Li in Hong Kong; Editing by Muralikumar Anantharaman, Angus MacSwan and Chizu Nomiyama

Our Standards: The Thomson Reuters Trust Principles.

Read original article here

World

China retaliates against South Korea’s COVID curbs, says outbreaks past peaks

Leave a comment

  • China embassy decries “discriminatory” S.Korea border rules
  • Some cities say peak of COVID infections was last month
  • Chinese state media criticise Pfizer over Paxlovid price

BEIJING, Jan 10 (Reuters) – Beijing retaliated on Tuesday against South Korea’s COVID-19 curbs on travellers from China, while state media further downplayed the severity of the outbreak in the last major economy to reopen its borders after three years of isolation.

China ditched mandatory quarantines for arrivals and allowed travel to resume across its border with Hong Kong on Sunday, removing the last major restrictions under the “zero-COVID” regime which it abruptly began dismantling in early December after historic protests against the curbs.

But the virus is spreading unchecked among its 1.4 billion people and worries over the scale and impact of its outbreak have prompted South Korea, the United States and other countries to require negative COVID tests from travellers from China.

Although China imposes similar testing requirements for all arrivals, foreign ministry spokesperson Wang Wenbin told reporters on Tuesday the entry curbs for Chinese travellers were “discriminatory.”

“We will take reciprocal measures,” Wang said, without elaborating.

The Chinese embassy in South Korea has suspended issuing short-term visas for South Korean visitors, it said on Tuesday, the first retaliatory move against nations imposing COVID-19 curbs on travellers from China.

The embassy will adjust the policy subject to the lifting of South Korea’s “discriminatory entry restrictions” against China, it said on its official WeChat account.

Kyodo news agency, quoting multiple travel industry sources, said China has told travel agencies that it has stopped issuing new visas in Japan. An AFP journalist tweeted that the Chinese embassy in Japan released a statement confirming the curbs on Tuesday but removed it from its website within minutes.

With the virus let loose, China has stopped publishing daily infection tallies. It has been reporting five or fewer deaths a day since the policy U-turn, figures that have been disputed by the World Health Organization and are inconsistent with funeral reporting surging demand.

Some governments have raised concerns about Beijing’s data transparency as international experts predict at least 1 million deaths in China this year. Washington has also raised concerns about future potential mutations of the virus.

China dismisses criticism over its data as politically-motivated attempts to smear its “success” in handling the pandemic and said any future mutations are likely to be more infectious but less harmful.

“Since the outbreak, China has had an open and transparent attitude,” the foreign ministry’s Wang said.

PAST THE PEAK

State media downplayed the severity of the outbreak.

An article in Health Times, a publication managed by People’s Daily, the ruling Communist Party’s official newspaper, quoted several officials as saying infections have been declining in the capital Beijing and several Chinese provinces.

Kan Quan, director of the Office of the Henan Provincial Epidemic Prevention and Control, said nearly 90% of people in the central province of 100 million people had been infected as of Jan. 6.

Beijing acting mayor Yin Yong said the capital was also past its peak. Li Pan, from the Municipal Health Commission in the city of Chongqing, said the peak there was reached on Dec. 20.

In the eastern province of Jiangsu, the peak was reached on Dec. 22, while in neighbouring Zheijiang province “the first wave of infections has passed smoothly,” officials said.

Financial markets looked through the latest border curbs as mere inconvenience, with the yuan hitting a nearly five-month high.

Although daily flights in and out of China are still at a tenth of pre-COVID levels, businesses across Asia, from South Korean and Japanese shop owners to Thai tour bus operators and K-pop groups celebrated the prospect of more Chinese tourists.

Chinese shoppers spent $250 billion a year overseas before COVID.

PFIZER CRITICISM

The border rules were not the only COVID conflict brewing in China.

State media lashed out at Pfizer Inc (PFE.N) over the price for its COVID treatment Paxlovid.

“It is not a secret that U.S. capital forces have already accumulated quite a fortune from the world via selling vaccines and drugs, and the U.S. government has been coordinating all along,” nationalist tabloid Global Times said in an editorial.

Pfizer’s Chief Executive Albert Bourla said on Monday the company was in discussions with Chinese authorities about a price for Paxlovid, but not over licensing a generic version in China.

China’s abrupt change of course in COVID policies has caught many hospitals ill-equipped, while smaller cities were left scrambling to secure basic anti-fever drugs.

Yu Weishi, chairman of Youcare Pharmaceutical Group, told Reuters his firm boosted output of its anti-fever drugs five-fold to one million boxes a day in the past month.

Wang Lili, general manager at another pharmaceutical firm, CR Double Crane (600062.SS), told Reuters that intravenous drips were their most in-demand product.

“We are running 24/7,” Wang said.

Reporting by Beijing and Shanghai bureaus; Writing by Marius Zaharia; Editing by Raju Gopalakrishnan

Our Standards: The Thomson Reuters Trust Principles.

Read original article here