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Sri Lanka's new leader appoints cabinet ahead of expected snap polls
Colombo, Sri Lanka — Sri Lanka's new leftist president appointed his Cabinet Tuesday ahead of an expected snap parliamentary election as he prepares to renegotiate the bankrupt island nation's unpopular International Monetary Fund bailout program.
Self-avowed Marxist Dissanayake of the People's Liberation Front (JVP) was sworn into office on Monday after a landslide win in weekend presidential polls.
His once-marginal party currently has just three lawmakers in Sri Lanka's 225-member parliament.
But support for the 55-year-old surged after a 2022 economic meltdown that immiserated millions of ordinary Sri Lankans and the painful implementation of the IMF rescue plan.
On Tuesday his office announced the appointment of lawmaker Harini Amarasuriya, 54, as premier with the additional portfolios of justice, education, health and labor.
The sociology lecturer, who was first elected to parliament four years ago, is known for her activism on gender equality and minority rights issues.
She and the remaining two JVP-aligned lawmakers will share all ministerial responsibilities between them, and also act as caretaker ministers after parliament is dissolved.
"We will have the smallest Cabinet in the history of Sri Lanka," party member Namal Karunaratne told reporters on Tuesday.
"Parliament dissolution will happen thereafter. It could be within the next 24 hours."
Sri Lanka's crisis proved an opportunity for Dissanayake, who saw his popularity rise after pledging to change the island's "corrupt" political culture.
He beat 38 other candidates to win Saturday's presidential vote, taking more than 1.2 million more votes than his nearest rival.
His predecessor Ranil Wickremesinghe, who had imposed steep tax hikes and other unpopular austerity measures under the terms of the $2.9 billion IMF bailout, came a distant third.
The IMF offered its congratulations to Dissanayake on Monday, saying it was ready to discuss the future of the rescue plan.
"We look forward to working together with President Dissanayake... towards building on the hard-won gains that have helped put Sri Lanka on a path to economic recovery," a spokesman from the lender of last resort said.
'Not a magician'
A senior aide of the new president told AFP on the weekend that Dissayanake's party would not repudiate the IMF deal.
"Our plan is to engage with the IMF and introduce certain amendments," Bimal Ratnayake said.
"We will not tear up the IMF program. It is a binding document, but there is a provision to renegotiate."
In his first address after his inauguration, Dissayanake sought to lower expectations of a quick fix for the country's economic woes.
"I am not a conjuror, I am not a magician, I am a common citizen," he said.
"I have strengths and limitations, things I know and things I don't," he added. "My responsibility is to be part of a collective effort to end this crisis."
German economy expected to contract again in 2024, say sources
Berlin — Germany's leading economic institutes have downgraded their forecast for 2024 and now see Europe's largest economy shrinking by 0.1%, people familiar with the figures from the autumn joint economic forecast told Reuters on Tuesday.
Germany's economy was the weakest among its large euro zone peers last year with a 0.3% contraction.
Even with inflation on a downward trend, consumption remains weak and high energy costs, feeble global orders and high interest rates are still taking their toll.
The latest economic data paint a gloomy picture. German business morale fell for a fourth straight month in September and by more than expected, a survey showed on Tuesday.
Data earlier this week showed German business activity contracted in September at the sharpest pace in seven months, putting the economy on track to notch up a second consecutive quarter of falling output.
The economic institutes have also slashed their forecasts for the coming years, according to the sources. The growth forecast for 2025 has been cut to 0.8% from 1.4%, and for 2026, the institutes envisage growth of 1.3%, the sources said.
The institutes' joint economic forecast is due to be published on Thursday, meaning the figures could still change slightly before then.
The economy ministry incorporates the combined estimates from the institutes — Ifo, DIW, IWH, IfW and RWI — into its own predictions.
According to its latest forecast, the German government expects the economy to grow 0.3% this year. An update is due in October.
New global poll finds South Africans feel among least safe
Johannesburg — A new global Gallup poll released Tuesday shows South Africa is one of the countries where citizens feel the least safe walking alone.
Bartender Gugu Xakaza, 32, was mugged by two men while walking home from the grocery store one day.
She said that was the last time she risked walking anywhere alone.
“I’d never walk around these streets, firstly you know because South Africa’s crime status is very high, and also it’s not just safe for a woman to be walking alone at night, because obviously we might be taken advantage of…. so rather be safe than sorry,” she said.
She is not alone.
Karabo Faith, 23, said she no longer walks anywhere by herself.
“I almost, almost got mugged at night… we were walking, going home," she said. "So, this other guy was like, ‘Hey, give us your phone.’ Then luckily these police officers came through, so they never took our phones. But we were scared.”
The latest Gallup poll on global safety asked people in 140 countries how safe they felt walking alone. Some 70% of South Africans responded that they did not feel safe, ranking in the bottom three countries, which also included Ecuador and Liberia.
Gallup is a global analytics and advisory firm.
Gallup’s Julie Ray said sub-Saharan Africa has had low rankings in the annual poll for years. And feelings of safety have declined more here than in any other region.
“The region has ranked amongst the least safe in terms of people’s perceptions for almost two decades,” Ray said.
By contrast, citizens in Kuwait, Singapore and Norway said they felt the safest, with between only 8% and 1% feeling unsafe.
Women in South Africa typically feel less safe than men, Ray said. Confidence in police in sub-Saharan Africa is also lower than average, she said.
Asked for comment on the report, Athlenda Mathe, spokesperson for the South African Police Services, said they were working on heightening police visibility.
“We are making inroads in clamping down on all forms of criminality and the main goal is to ensure that we make South Africa a much better and safer place to live in, so that people can walk freely,” Mathe said.
South Africa has notoriously high crime rates.
According to the latest police statistics, between April and June alone more than 6,000 murders and 9,000 rapes were recorded, for rates of 10 per 100,000 population and 15 per 100,000, respectively.
Sweden accuses Iran of hacking messaging service after Koran burnings
STOCKHOLM — Swedish authorities said on Tuesday that Iran hacked into a text messaging service last year and sent thousands of messages urging Swedes to take revenge against Koran burners.
In 2023, individuals in Sweden on several occasions set fire to Islam's holy book in public, prompting outrage in the Muslim world and raising fears of attacks by jihadists.
"The security police is able to establish that a cyber group acted on behalf of the Iranian Revolutionary Guard to carry out an influence campaign," the Swedish Security Service said in a statement.
"The purpose was, among other things, to paint the image of Sweden as an Islamophobic country and create division in society," it said.
Sweden last year raised its terrorism alert following the Koran burnings.
In a separate statement, the Swedish Prosecution Authority said the investigation showed it was the Iranian state via the Iranian Islamic Revolutionary Guard Corps that carried out the data breach.
The Swedish agency said it had identified the individual hackers carrying out the breach but would not press charges.
"Since the perpetrators are acting for a foreign power, in this case Iran, we make the assessment that the conditions for prosecution abroad or extradition to Sweden are lacking," it said.
Iran's embassy in Stockholm could not immediately be reached for comment. Iran's foreign ministry had no immediate comment.
Pope asks for liberation of Myanmar's detained ex-leader Suu Kyi
ROME — Pope Francis has called for the liberation of Myanmar's detained former leader and Nobel laureate Aung San Suu Kyi and offered the Vatican as a safe haven, the pontiff said in a recent conversation with Jesuits in Asia.
"I asked for the Ms Aung San Suu Kyi's release and received her son in Rome. I offered the Vatican to receive her in our territory," he said in a private conversation during a recent 12-day tour across Southeast Asia.
The 87-year old pontiff visited Myanmar in December 2017.
Italian daily Corriere della Sera published the comments on Tuesday in an article by Father Antonio Spadaro, a Rome-based Jesuit priest who attends the meetings and writes about them afterwards with the pope's permission.
"The future of the (Myanmar) must be peace based on respect for the dignity and rights of all, on respect for a democratic order that allows everyone to contribute to the common good," Pope Francis added.
Myanmar's military government has ramped up killings and arrests in an apparent bid to silence opponents and recruit soldiers in an escalating conflict, a U.N. report said last week.
Suu Kyi, 78, has been detained by the military since it overthrew her government in a 2021 coup. She faces 27 years in prison for crimes ranging from treason and bribery to violations of the telecommunications law, charges she denies. In April she was moved from prison to house arrest.
Kmart closes its last full-scale US store
NEW YORK — Attention, Kmart shoppers, the end is near!
The erstwhile retail giant renowned for its Blue Light Specials — featuring a flashing blue orb affixed to a pole enticing shoppers to a flash sale — is shuttering its last full-scale store in mainland United States.
The store, located in swank Bridgehampton, New York, on Long Island, is slated to close Oct. 20, according to Denise Rivera, an employee who answered the phone at the store late Monday. The manager wasn't available, she said.
That will leave only a small Kmart store in Miami. It has a handful of stores in Guam and the U.S. Virgin Islands.
Transformco, the company that bought the assets of Sears and Kmart out of the bankruptcy of Sears Holdings in 2019, did not immediately respond to an email requesting comment.
In its heyday, there were more than 2,000 Kmarts in the U.S.
Struggling to compete with Walmart’s low prices and Target’s trendier offerings, Kmart filed for Chapter 11 bankruptcy protection in early 2002 — becoming the largest U.S. retailer to take that step — and announced it would close more than 250 stores.
A few years later, hedge fund executive Edward Lampert combined Sears and Kmart and pledged to return them to their former greatness. But the 2008 recession and the rising dominance of Amazon contributed in derailing that mission. Sears filed for Chapter 11 in 2018 and now has just a handful of stores left in the U.S., where it once had thousands.
Some Japan PM hopefuls want to make hiring and firing workers easier
TOKYO — At least two candidates vying to become Japan's next prime minister are planning to tackle one of the country's most sacred political cows: labor market reforms that would make it easier for businesses to hire and fire workers.
Shinjiro Koizumi, the 43-year-old son of former premier Junichiro Koizumi, and Taro Kono, who as digital minister is trying to promote more innovation, have both called for relaxing Japan's rigid labor rules.
Those rules have been a feature of Japan's "salary-man" corporate culture for decades, dating from when the country's post-war population was growing and its traditional labor model of lifetime employment was effective.
But rigid labor rules have been more recently blamed for blocking the movement of labor from mature sectors into growing ones where employees are needed in a tight labor market.
"The ongoing labor market reform is missing the crux of the issue, and that's the revision to dismissal rules," Koizumi said this month.
"An ultimate growth strategy is to create a system that fosters a labor shift to startups and small firms in growth sectors," said Koizumi, who pledged to submit a labor reform bill next year if elected party leader.
Kono specifically proposed establishing a monetary compensation framework for dismissed workers as a way to settle disputes, a step he said would allow more flexibility in the labor market.
Overhauling dismissal rules is politically sensitive in Japan, having been repeatedly pushed back with little progress made in the past.
International bodies such as the Organization for Economic Cooperation and Development (OECD) have also long blamed the lack of employment flexibility for Japan's low labor productivity, low rates of new business entries and income gap between regular and non-regular staff.
On average, Japanese workers have been with their current employer for 12.3 years, compared to 4.1 years in the United States and 9.7 years in Germany. A Gallup poll found only 6% of Japanese workers engaged in their jobs compared to the 23% global average.
The statutory law on dismissal is vague, but judicial precedents have established four criteria that have to be met, raising the bar high for layoffs, experts say.
The rules, for example, require the company to prove that there is an economic need to decrease its workforce and all efforts have been made to avoid dismissals when firing employees.
"The biggest issue is that these rules are based on judicial precedents decades ago," said Kotaro Kurashige, a lawyer who specializes in labor issues.
Japan's Liberal Democratic Party, which has a parliamentary majority, will elect a new leader on Sept. 27, with the winner to replace outgoing Prime Minister Fumio Kishida. A record nine candidates are running in the race.
As in the past, the policy pledges by Koizumi and Kono have sparked heavy backlash on social media and from labor unions, as well as from conservative lawmakers worried such changes could increase layoffs.
"I strongly object to any relaxation of rules that allow companies to freely fire workers," Tomoko Yoshino, the president of Japan's largest labor organization Rengo, said in an emergency study session last week.
Some also doubt the validity of the argument that relaxed dismissal rules would help rejuvenate the economy.
"It may not be true that relaxed rules would promote a shift of labor to growth sectors and overall wage growth, as dismissed workers may end up with low-paying jobs," Takuya Hoshino, economist at Dai-ichi Life Research Institute, said.
The negative reactions have forced Koizumi to water down his pledge and shift his focus more to increasing support for workers to acquire skills and find new jobs, initiatives already launched by the Kishida administration.
Still, proponents say the opportunity for reform is now greater than in the past, as Japan exits years of deflation with companies delivering the biggest wage hikes in three decades this year and the jobless rate consistently below 3%.
Suntory Holdings CEO Takeshi Niinami, one of the leading voices of corporate Japan, welcomed the issue coming up during the ruling party leadership race.
"Those rules were created during the manufacturing-centered postwar economic boom and must be reviewed," said Niinami, who also serves as chair of the Keizai Doyukai business lobby.
It's good timing for such discussion as labor shortages and tougher competition for talent have begun to push up wages, he said. "I want new-generation leaders to discuss how to change all postwar frameworks without any taboo."
Rare graft case grips Singapore, ex-transport minister pleads guilty
SINGAPORE — Singapore's former Transport Minister S. Iswaran has pleaded guilty to receiving gifts while in office, local media reported, as proceedings began on Tuesday in a rare graft trial involving a state official in this Asian financial hub.
The case, which charges Iswaran with receiving favors that includes tickets to English Premier League soccer matches and to the Singapore Formula 1 Grand Prix, has gripped the wealthy city-state which prides itself on having a well-paid and efficient bureaucracy as well as strong governance.
Iswaran, who joined the cabinet in 2006, is the first Singaporean minister to be tried in court.
The 62-year-old was arrested in July last year and was accused of taking kickbacks worth hundreds of thousands of dollars from property tycoon Ong Beng Seng. Iswaran was advisor to the Grand Prix's steering committee, while Ong owns the rights to the race.
Ong has not been charged with any offense and Iswaran had previously rejected the allegations when he resigned from the cabinet.
In court, he pleaded guilty to the charges of obstructing justice and of a public servant accepting anything of value without payment, or with inadequate payment, from a person with whom he is involved in an official capacity, Channel NewsAsia (CNA) reported, instead of the charges that include corruption.
In a surprise move, prosecutors reduced the charges facing Iswaran to five from 35. The remaining 30 charges will be taken into consideration for sentencing, it added.
The charge of accepting gifts carries a jail term of up to two years and a fine. For obstructing justice, Iswaran can be sentenced to jail of up to seven years and a fine.
However, the prosecution asked for a much lighter sentence of six to seven months in jail, while the defense is asking for eight weeks, according to CNA.
The prosecution said Iswaran had obtained, from two local businessmen, gifts worth a total value of $312,440. Iswaran has paid his financial gains of roughly $315,000 in full to the state, they added.
"The accused obtained all of the gifts for himself, some of which he then distributed to family, friends and others," the prosecution said.
The last corruption case involving a Singaporean minister was in 1986, when the national development minister was investigated for allegedly accepting bribes. He died before he could be charged in court.
Singapore was among the world's top 5 least corrupt countries last year, according to Transparency International's corruption perception index.
Climate goal to triple global renewable energy by 2030 within reach, IEA says
LONDON — A goal to triple global renewable energy capacity by 2030 and cut fossil fuel use is within reach, the International Energy Agency said in a report on Tuesday, but will require a huge push to unlock bottlenecks such as permitting and grid connections.
The report comes as leaders from government and business come together at New York Climate week to try to drive forward action against climate change.
Almost 200 countries at the COP 28 climate summit in Dubai last year agreed to reach net zero emissions from the energy sector by 2050 and pledged to triple renewable energy capacity like wind and solar.
The IEA said the renewable energy goal "is within reach thanks to favorable economics, ample manufacturing potential and strong policies," but said more renewable capacity by itself would not slash fossil fuel use and reduce costs for consumers.
“To unlock the full benefits of the tripling goal, countries need to make a concerted push to build and modernize 25 million kilometers of electricity grids by 2030... The world would also need 1,500 gigawatts (GW) of energy storage capacity by 2030,” the IEA said.
Countries at COP 28 also pledged to double energy efficiency measures to help curb power use, but this target will require governments to make efficiency much more of a policy priority.
Countries must embed the renewable and energy efficiency goals in their national plans to meet goals set under the Paris climate agreement, the IEA said.
Emissions from the global energy sector hit a record high last year.
Tripling renewable energy capacity and doubling energy efficiency measures to reduce power use could reduce global greenhouse gas emissions by 10 billion metric tons by the end of the decade compared with what is otherwise expected, the report said.
China unveils broad stimulus measures to revive sputtering economy
BEIJING — China's central bank on Tuesday announced broad monetary stimulus and property market support measures to revive an economy grappling with strong deflationary pressures and in danger of missing this year's growth target.
The broader-than-expected package marks the latest attempt by Chinese officials to restore confidence in the world's second-largest economy after a slew of disappointing data in recent months.
But analysts noted the absence of any policies aimed at supporting real economic activity. Given weak credit demand from businesses and consumers, more fiscal stimulus may be needed to complement the moves announced by the People's Bank of China for growth to return to a trajectory towards this year's roughly 5% target.
"This is the most significant PBOC stimulus package since the early days of the pandemic," said Capital Economics analyst Julian Evans-Pritchard.
"But on its own, it may not be enough."
Chinese stocks and bonds rallied and Asian stocks hit 2-1/2 year highs as Governor Pan Gongsheng announced plans to lower borrowing costs and inject more liquidity into the economy, as well as to ease households' mortgage repayment burden.
Pan told a news conference the central bank in the near future will cut the amount of cash that banks must hold as reserves - known as reserve requirement ratios (RRR) - by 50 basis points (bps).
That would free up about $142 billion for new lending. Depending on the market liquidity situation later this year, the RRR may be further lowered by 0.25-0.5 percentage points, Pan said.
The PBOC will also cut the seven-day repo rate, its new benchmark, by 0.2 percentage points to 1.5%. The interest rate on the medium-term lending facility will drop by about 30 basis points, and loan prime rates by 20-25 bps.
"The move probably comes a bit too late, but it is better late than never," said Gary Ng, senior economist at Natixis. "China needs a lower-rate environment to boost confidence."
Pan did not specify when the moves will come into effect.
The property market support package included a 50 bps reduction on average interest rates for existing mortgages, and a reduction of the minimum downpayment requirement to 15% on all types of homes, among other measures.
China's property market has been in a severe downturn since peaking in 2021. A string of developers have defaulted, leaving behind large inventories of unwanted apartments and a troubling list of uncompleted projects.
Beijing has removed many home purchase restrictions and sharply lowered mortgage rates and downpayment requirements in response, but has so far failed to revive demand or arrest slumping home prices, which fell in August at the sharpest pace in more than nine years.
The property crisis has weighed heavily on the economy and crippled consumer confidence, given that 70% of household savings are parked in real estate.
The PBOC also introduced two new tools to boost the capital market.
The first - a swap program sized at an initial $71 billion - allows funds, insurers and brokers easier access to funding in order to buy stocks; and the second provides up to $42.5 billion in cheap PBOC loans to commercial banks to help them fund other entities' share purchases and buybacks.
August economic data broadly missed expectations, adding urgency for policymakers to roll out more support.
On the fiscal side, local governments have been quickening bond issuance to help fund infrastructure projects, but analysts say more may be needed.
"An aggressive fiscal policy is required to inject genuine economic demand," ANZ analysts said in a note on the PBOC moves, which they described as "far from being a bazooka."
Investment banks including Goldman Sachs, Nomura, UBS and Bank of America have recently cut their 2024 growth forecasts.
The latest Chinese measures come after the U.S. Federal Reserve last week delivered a hefty rate cut, allowing the PBOC to ease monetary conditions without putting too much pressure on the yuan.
"There is still room for further easing in the months ahead as most global central banks are now on a rate-cut trajectory," said Lynn Song, chief economist for greater China at ING.
"If we see a large fiscal policy push as well, momentum could recover heading into the fourth quarter."
Israel to Lebanese citizens “our war is not with you”
Lebanon's health ministry says Israeli strikes on Monday killed more than 492 Lebanese, including more than 60 women and children, in the deadliest barrage since the 2006 Israel-Hezbollah war. The U.S. to ban Chinese vehicle software. We talk with Brandie Nonnecke, the founding director of the CITRIS Policy Lab, associate professor of technology policy research at the Berkley Goldman School of Public Policy and host of the podcast TecHype. A female cat has more freedom in Afghanistan than a woman does, Hollywood actor Meryl Streep said at the United Nations on Monday. And California sues Exxon-Mobile over plastic.
Kurdish woman works to revive abandoned hometown
In Iraqi Kurdistan, one woman is working to bring life back to her village that was abandoned 38 years ago. Speaking to VOA, Khuncha Omer explained how planting trees and taking care of the land has given her a bigger purpose to strive for.