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Reuters
12-05-2025
- Business
- Reuters
Breakingviews - US-China truce cools down trade war, for now
HONG KONG, May 12 (Reuters Breakingviews) - Doomsday has been undone, for now. Forty days after President Donald Trump announced his reckless reciprocal tariffs in the White House Rose Garden, leading to a full-blown U.S.-China trade war with triple-digit levies, both sides have coordinated an about-face. The roll-back prompted a rally in stocks and the dollar, though the outcome is better for one side than the other. In a joint statement, opens new tab on Monday, the world's two largest economies agreed to scrap eye-watering levies. For the next 90 days, additional U.S. tariffs on Chinese goods imposed this year will stand at 30%, which encompasses the now-standard baseline 10% charge on most of Washington's trading partners plus a 20 percentage point hike Trump imposed in January over fentanyl concerns. China's tariffs on U.S. goods will be cut to 10%. But this is not a deal, it is a fragile truce governing $600 billion of bilateral trade and it could easily be shattered by new sector-specific tariffs vowed by the Trump administration. There is no clarity on where American export restrictions on semiconductor shipments to China, or a review of the U.S. electronics supply chain based on national security concerns, will end up, for instance. Nor is there a clear path to ensure U.S. tariffs don't rise back up to 54%, or Chinese tariffs up to 34%, after the 90-day deadline passes in August, so uncertainty on two-way trade will endure. Yet this truce is an obvious win for Beijing. Until now, Chinese leaders faced a 2.4 percentage point hit to annual GDP growth that, going by earlier estimates from Goldman Sachs, has now been pared to roughly 1 percentage point. Hitting their headline target for an expansion of around 5% still looks unlikely, but the shortfall will be less painful. The significant de-escalation in trade tensions implies a rapid and dangerous financial decoupling is off the table for now, too. It is also a propaganda win. Both the joint statement and Treasury Secretary Scott Bessent's comments were peppered with references to 'mutual respect', a phrase straight out of Communist Party officialese. Chinese leaders also have agreed vaguely only to 'suspend or remove' non-tariff measures, such as restrictions on rare-earth sales to the U.S., taken since April 2 – hardly a firm commitment. The pact demonstrates to other countries locked in tariff talks with Washington the tangible value of pushing back: Trump has shown that he will retreat when economic consequences start to bite and bond markets revolt. The rest of the world has every reason to hold the president's feet to the fire now that he has blinked again. Follow @KangHexin, opens new tab on X CONTEXT NEWS The U.S. and China on May 12 agreed to temporarily slash reciprocal tariffs. Additional tariffs imposed on Chinese goods during President Donald Trump's second administration have been lowered from over 145% to 30%. The revised level includes 10% in line with a baseline levy Washington imposed on other trading partners on April 2, as well as an additional 20% tariff imposed on China in January relating to fentanyl. Those in the opposite direction have been cut from 125% to 10%, with Beijing also promising to 'suspend or remove' non-tariff measures taken since April 2. The joint statement implies that additional American tariffs on Chinese exports could rise to 54% after 90 days, and Chinese tariffs on U.S. exports could rise to 34%.
Reuters
12-03-2025
- Politics
- Reuters
Britain warns Iran sanctions could be reimposed as UN Security Council meets
UNITED NATIONS, March 12 (Reuters) - Britain warned on Wednesday that it would trigger a return of U.N. sanctions on Iran, if needed, to prevent it from getting a nuclear weapon as the Security Council met to discuss Tehran's expansion of its stock of uranium close to weapons grade. Iran has denied wanting to develop a nuclear weapon. However, it is "dramatically" accelerating enrichment of uranium to up to 60% purity, close to the roughly 90% weapons-grade level, the U.N. nuclear watchdog - the International Atomic Energy Agency - has warned. Western states say there is no need to enrich uranium to such a high level under any civilian program and that no other country has done so without producing nuclear bombs. Iran says its nuclear program is peaceful. "We are clear that we will take any diplomatic measures to prevent Iran acquiring a nuclear weapon, that includes the use of snapback (of sanctions), if needed," Britain's deputy U.N. Ambassador James Kariuki told reporters ahead of the meeting. The closed-door meeting was called by six of the council's 15 members - the U.S., France, Greece, Panama, South Korea and Britain. Iran's U.N. mission accused the United States of seeking to weaponize the U.N. Security Council "to escalate economic warfare against Iran," adding in a post on X: "This dangerous abuse must be rejected to protect the council's credibility." The U.S. mission to the U.N. said in a statement after the council meeting that Iran was "the only country in the world without nuclear weapons producing highly enriched uranium, for which it has no credible peaceful purpose." It accused Iran of defying the Security Council and violating IAEA obligations, calling on the council to "be clear and united in addressing and condemning this brazen behavior." 'SEIZE THE LIMITED TIME' U.S. President Donald Trump last month restored a "maximum pressure" campaign on Iran in a bid to stop Tehran from building a nuclear weapon. But he also said he was open to a deal and was willing to talk to Iran's President Masoud Pezeshkian. Trump wrote a letter to Iran calling for nuclear talks, which was delivered on Wednesday, but Iran's Supreme Leader Ayatollah Ali Khamenei rejected holding negotiations. China will hold a meeting on Friday in Beijing with Russia and Iran on the Iranian "nuclear issue", its foreign ministry said, with both nations sending their deputy foreign ministers. "We still hope that we can seize the limited time we have before the termination date in October this year, in order to have a deal, a new deal so that the JCPOA can be maintained," China's U.N. Ambassador Fu Cong told reporters ahead of the Security Council meeting. "Putting maximum pressure on a certain country is not going to achieve the goal," he said. Iran reached a deal in 2015 with Britain, Germany, France, the U.S., Russia and China - known as the Joint Comprehensive Plan of Action - that lifted sanctions on Tehran in return for restrictions on its nuclear program. Washington quit the agreement in 2018 during Trump's first term as U.S. president, and Iran began moving away from its nuclear-related commitments. Britain, France and Germany will lose the ability to trigger the so-called snap back of all international sanctions on Iran on October 18 when the 2015 U.N. resolution on the deal expires. Trump has directed his U.N. diplomats to work with allies to snap back international sanctions and restrictions on Iran. Under the complex two-month JCPOA dispute resolution process, the European parties to the deal effectively have until early August to trigger a snapback of U.N. sanctions on Iran.
The Guardian
07-03-2025
- Business
- The Guardian
Who are the US federal workers at risk of losing their jobs and what do they do?
Tens of thousands of US federal employees could lose their jobs after the Trump administration moves to reduce the size of the federal workforce dramatically. With Elon Musk at the helm of the so-called 'department of government efficiency' (Doge), which is overseeing efforts to cull federal employment, the White House has embarked on multiple plans to cut down on virtually all areas of federal employment. There are no official numbers of how many federal employees will be affected, and many of Donald Trump and Musk's efforts have been stalled in court, but the impact could be big and long-lasting. To understand what the cuts will do to federal operations, we first have to understand who works for the federal government and what they do. Here's what we know about the federal workforce. There are about 3 million federal employees in the US, about 2% of the entire US workforce, according to the Bureau of Labor Statistics (BLS), the data division of the Department of Labor. Much of the federal workforce falls under the executive departments, the leaders of which make up the president's cabinet. The Department of Defense is the largest employer, as it houses the US military, which includes the army, navy and air force, and has more than 750,000 employees. This figure encompasses the civil workforce within the defense department. There's an additional 1.3 million active-duty US military personnel that BLS does not include when counting the federal workforce. The Department of Veterans Affairs is the next largest employer, with approximately 480,000 employees. The number of federal workers has largely remained unchanged over the last 50 years, with exceptions every 10 years for when there's an influx of employees working on the US Census. When compared with the overall employed workforce, federal workers skew slightly older. More than 50% of federal workers are over 45, compared with 43% of the overall workforce. Meanwhile, the racial demographics of the federal workforce largely reflect the demographics of the country as a whole, with one key exception: the federal government has a higher percentage of Black employees than the private sector. This is likely because the federal government implemented laws after the civil rights era to prevent bias in workplace hiring, allowing more Black workers to enter the federal workforce. In January, Donald Trump signed two sweeping executive orders that ended diversity, equity and inclusion (DEI) programs inside the federal government. He overturned multiple executive orders, including one from the civil rights era that required private contractors to practice equal employment opportunity when hiring. While the federal layoffs are separate from Trump's DEI actions, they both encompass dramatic efforts from the Trump administration to curtail the federal government's role as an employer. It's a common misconception that most federal workers live in Washington DC. While federal workers make up a huge chunk of Washington's population, the vast majority of federal workers live in other states across the country. They range from a national parks ranger in Montana to an infectious disease researcher in Georgia to a doctor working at a hospital run by the veterans affairs department. The US Department of Agriculture (USDA) alone has more than 100,000 employees across 4,500 offices nationwide. Federal employees make up just a small fraction of all government employees in the US. The vast majority of government workers, about 15 million, work for local governments, while nearly 6 million work for state governments. Local governments manage police and fire departments, parks and recreation and housing services. State governments often work with local governments to help with things such as regulating highways and education. BLS does not consider those who work for federal contractors, or private companies that have agreements to do work for the federal government, as federal government employees. There is no official number for how many private contractors there are for the federal government, but a recent Brookings Institution analysis estimated that there were approximately 5.2 million private contractor employees in 2023. Musk is leading the White House's efforts to downsize the federal government, all supposedly for the sake of saving money. Musk said in October 2024 at a campaign event for Trump in New York City that he wants to cut the federal government budget by $2tn. Keep in mind that discretionary spending, or the amount that Congress has control over, was $1.7tn in 2023. In February, Musk said from the Oval Office: 'The people voted for major government reform, and that's what the people are going to get.' There are two main initiatives that Musk's Doge is trying to carry out. The first is offering federal employees buyouts for voluntarily leaving their jobs, and the second is laying off probationary employees, or employees who have been in their job for less than a year and don't have civil service protection. It is unclear how many employees these initiatives will affect. The White House has said about 75,000 employees accepted buyouts, which will give workers a few months of pay and benefits if they leave their jobs imminently, what is known as 'deferred resignation'. A federal judge temporarily blocked the program, which the Trump administration will now have to defend in court. Meanwhile, the layoffs of probationary employees appears to have caused chaos across many parts of the federal government. The Internal Revenue Service (IRS), Department of Health and Human Services and Department of Defense all said they each had more than 5,000 employees on probation who could be laid off. The White House said that military service members, postal service workers and those whose positions relate to national security, immigration and public safety would be exempt from the buyout and layoff programs.
New York Times
04-03-2025
- Business
- New York Times
China Targets San Diego Biotech Firm in Broadening Blacklist
China signaled on Tuesday that it is willing to go further than before in its trade tit-for-tat with President Trump by hitting a top American biotechnology company. China's Ministry of Commerce said it would ban Illumina, a San Diego company, from importing its gene-mapping products in China. Illumina is the world's leading producer of gene-sequencing machines and counts on China for 7 percent of its sales. Beijing also said it took action against dozens of other companies from the United States as part of a volley of action against Washington in retaliation for another of tariffs. Chinese officials singled out 15 companies, including the drone maker Skydio, for punitive trade measures to 'safeguard national security and interests.' It also said it added another 10 American companies to what it calls an 'unreliable entities list' preventing them from doing any business in China. Both blacklists have increasingly become go-to tactics for Beijing in striking back at Washington in their escalating trade war. But in the past, Beijing has taken narrower action, targeting defense companies related to arms sales with Taiwan and companies with little to no presence in China. This time Beijing went further and banned Illumina from doing business in China, accusing it of violating market transaction rules and discriminating against Chinese companies. Beijing put the company on a blacklist last month, together with PVH, the clothing maker behind Calvin Klein and Tommy Hilfiger. Illumina said it was assessing Beijing's action 'to fully understand the impact on our operations in China,' but that it would continue to serve its customers in China. 'We respect and abide by Chinese laws and regulations, and we are committed to operating in compliance with the latest guidelines from the Ministry of Commerce,' an Illumina spokeswoman said in a statement. Up until now, China has been reluctant to take retaliatory swipes that would affect American companies' businesses for fear of spooking foreign investors. Even after targeting Illumina, Chinese officials sought to pre-empt concerns. China targets only 'a small number of foreign entities that endanger China's national security in accordance with the law,' the commerce ministry said in a statement, adding that it 'welcomes companies from all over the world to invest and start businesses in China.' The action on companies was part of a broader response taken in the minutes after President Trump's latest round of tariffs. The retaliation from Beijing included tariffs on food imported from the United States. 'For China, the ultimate scenario would be a total reduction in trade hostilities with the U.S.,' said Joe Mazur, an analyst at Trivium, a research firm. 'That is not going to happen, and so the only thing they can do right now is make an example of a handful of companies.' China and the United States appear to be headed for more trade collisions even as Chinese academics and former diplomats have traveled to Washington in recent weeks to try to initiate conversations for a deal. Beijing may be more emboldened now to take further punitive action against American companies in China, Mr. Mazur said. 'In sending the message,' he said, 'you are making other American companies wary of their position in China.'
