Archive for the ‘Uncategorized’ Category

China says Japanese military endangering Chinese aircraft

October 27, 2016


Thu Oct 27, 2016 

China’s Defence Ministry on Thursday accused Japanese air force jets of locking their radars on to Chinese military aircraft, acting provocatively and endangering safety, after Japan said it is scrambling a record number of fighter jets.

China and Japan have long been mired in a territorial dispute over a group of tiny, uninhabited East China Sea islands, called the Senkaku in Japan and Diaoyu in China.

Patrol ships and fighter jets from Asia’s two biggest economies have been shadowing each other on and off near the islets, raising fears that a confrontation could result in a clash.

In the six months ending in September, Japanese fighters scrambled to chase Chinese planes 407 times compared with 231 times in the same period last year, the Japanese Air Self-Defence Force said in mid-October, an increase of about three-quarters.

Chinese Defence Ministry spokesman Wu Qian said Chinese air force activities accorded with international law and norms, and that it was Japan which was increasing its monitoring and interfering in normal training exercises.

“What is more, when aircraft of the Japan Self-Defence Forces encounter Chinese aircraft, their radars light up, they let off infrared jamming projectiles and show other unprofessional, dangerous provocative behavior,” Wu said at a monthly briefing.

“This endangers the safety Chinese aircraft and personnel and is the root of the China-Japan maritime and air problem.”

China urges Japan to adopt a responsible attitude and prevent such incidents from happening, he added.

Japan worries that as China increases its control over the South China Sea, it is turning its attention to expanding its influence in the East China Sea and into the western Pacific.

China insists regular patrols in the region are its right and intended to protect national security and sovereignty.

Tokyo’s support for a July ruling by an arbitration court in the Hague that invalidated China’s sweeping claims in the disputed South China Sea, a case brought by the Philippines, has also angered Beijing.

China refuses to recognize that decision and says countries not directly involved in the disputes, namely the United States and Japan, should not get involved.

Japan is strengthening its ties in the region, in particular with the Philippines and Vietnam, which contest China’s claims to parts of the sea, and it aims to help build the capacity of coastal states in the busy waterway.

Philippine President Rodrigo Duterte said on Thursday his country could join naval exercises with Japan.

(Reporting by Ben Blanchard; Editing by Nick Macfie)

U.S. Lawmakers Urge Action On China’s Aliminum — Asking U.S. Trade Representative Michael Froman to bring case to World Trade Organization

October 27, 2016

Letter asks U.S. Trade Representative Michael Froman to bring case to World Trade Organization

Senator Charles Schumer (D., N.Y.) is among the senators saying that China’s 'unfair trade practices' are 'undermining the entire U.S. aluminum value chain.'
Senator Charles Schumer (D., N.Y.) is among the senators saying that China’s ‘unfair trade practices’ are ‘undermining the entire U.S. aluminum value chain.’ PHOTO: BLOOMBERG NEWS

Eight U.S. senators have asked the Obama administration to take action against China over what they say are unfair subsidies to the Chinese aluminum industry.

In an Oct. 21 letter to U.S. Trade Representative Michael Froman, reviewed by The Wall Street Journal, the senators said China’s “unfair trade practices” are “undermining the entire U.S. aluminum value chain.” The Journal has reported that federal officials recently opened investigations into aluminum imports originating in China.

The senators, including Sherrod Brown (D., Ohio), Rob Portman (R., Ohio), Charles Schumer (D., N.Y.) and Debbie Stabenow (D., Mich.), asked Mr. Froman to take action against China at the World Trade Organization “before U.S. manufacturers and their workers incur further irreparable harm.” If the WTO were to agree, U.S. tariffs on Chinese aluminum imports could rise.

Chinese aluminum products are already subject to U.S. tariffs, some as high as 374.15%.

Neither the USTR nor the Chinese embassy in Washington, D.C., responded to requests for comment.

“China has unfairly subsidized its aluminum industry,” Sen. Brown said. “It’s not competing, it’s cheating.” The USTR should “use every tool in the toolbox to push back against the Chinese government’s attempts to unfairly tilt the playing field to their advantage,” Sen. Schumer said.

The letter says China’s aluminum producers benefit from government reductions on their energy bills and “tens of millions of dollars in cash infusions.”

In a July speech at the WTO in Geneva, the USTR’s deputy chief of mission, Christopher Wilson, said Chinese government support of steel and aluminum “fueled significant capacity expansion at times of weak or failing demand and contributed heavily to today’s severe global excess capacity.”

Chinese aluminum output has surged in recent years, accounting for 55% of global production in 2015, up from 24% a decade ago, according to the U.S. Geological Survey. U.S. output accounted for 2.7% of global production in 2015, according to the USGS.

Federal officials have been scrutinizing several companies with links to the billionaire founder of giant Chinese aluminum producer China Zhongwang Holdings Ltd. The Journal in September reported the Commerce Department is investigating whether a New Jersey company, Aluminum Shapes LLC, imported aluminum pallets from China Zhongwang and then used the metal for other products as a way to avoid punitive tariffs.

In September, Wen Xianjun, a director of China Zhongwang and representative of the China Nonferrous Metals Industry Association, told the U.S. International Trade Commission that allegations by U.S. industry officials that Chinese companies are skirting global trade rules “do not hold ground.”

The Journal reported Wednesday that the Department of Homeland Security is investigating whether U.S. companies linked to China Zhongwang founder Liu Zhongtian illegally avoided punitive aluminum import tariffs.

China Zhongwang said it isn’t aware of the investigation and that it follows established trade laws.

Mr. Liu and China Zhongwang were subjects of a September Journal article detailing allegations that firms linked to Mr. Liu routed aluminum through Mexico in an effort to disguise its origin and avoid U.S. tariffs. Mr. Liu denied any connection to the Mexico metal.

Since taking office, President Barack Obama has overseen two dozen new trade enforcement actions at the WTO, with 14 of those against China and three against India.

Write to Scott Patterson at


Venezuela on the Brink — Journalists Expelled — Maduro drops all pretense of democratic rule

October 27, 2016


Published October 27, 2016

Fox News Latino

ABC News correspondent Matt Gutman was detained by Venezuelan intelligence agents Monday while he was preparing a news report about the dire conditions at the Central Hospital of Valencia, in the state of Carabobo, the National Union of Media Workers told Fox News Latino.

He and two physicians who were aiding him were transferred to the government agency’s headquarters in Valencia, where they remained for three days.

Gutman was released Wednesday night and put on a plane back to the U.S. The two doctors were also released.

“After three days in detention at the SEBIN, Matthew Gutman, a correspondent for ABC News, was ejected Wednesday night from Venezuela, and forbidden to return,” said Marco Ruiz, general secretary of the National Union of Press Workers.

ABC News confirmed Gutman’s detainment in a statement Thursday morning.

“Matt was detained while in Venezuela to report for ABC News. He was released without incident,” the statement said.

There were no charges and he was not arrested.

Marco Ruiz, the head of media union, told FNL Gutman was “accused of compromising the security of the nation and disturbing the public order.”

Gutman, 39, has been a correspondent for ABC News since 2008. He is a well-known ABC News correspondent who is a frequent contributor to “Good Morning America” and “Nightline.” Before joining ABC News, Gutman was a Jerusalem-based reporter for seven years and covered every major conflict in the Middle East.

In 2000-2001, Gutman spent a year traveling and freelancing through Latin America and Africa. His first published article appeared in the Buenos Aires Herald in 2000.

The Central Hospital of Valencia is one of many in the country operating in extremely poor conditions, with a limited supply of medicines and a decaying infrastructure. During a recent visit to the hospital, Fox News Latino saw patients lying on the floor because of a lack of beds.

According to government reports obtained by the Associated Press, one in three people admitted to public hospitals in Venezuela last year died. The number of operational hospital beds has fallen by 40 percent since just 2014. And as the economy fails, the country is running short on 85 percent of medicines.

Also on Wednesday, four foreign correspondents who arrived in the country to cover a demonstration against the government were also detained in Caracas’ Maiquetia Airport.

They were held for more than 24 hours for allegedly lacking the right documentation. They were deported Wednesday night and told they were banned from reentering the country.

The reporters were Ricardo Burgos, Leonidas Chavez and Armando Munoz, from Peru, and Rodrigo Abd, from Argentina.

Abd, an Associated Press photographer who has spent years documenting social problems in Latin America, last week was awarded the prestigious Maria Moors Cabot Prize.

The recent expulsion of journalists from Venezuela comes after Miami Herald Andean Bureau Chief Jim Wyss and two Al Jazeera journalists were detained and ejected from the country in late August after they arrived to cover a mass protest. It was the second time Wyss had been detained by Venezuelan authorities.

In an attempt to defuse the worsening economic and political crisis, earlier this week the government and members of the opposition agreed on starting a dialogue sponsored by the Varican. The talks are set to begin Sunday in the Caribbean island of Margarita. Maduro met with Pope Francis privately on Monday.

With reporting by the Associated Press.

María Emilia Jorge M. is a freelancer journalist living in Caracas, Venezuela.



Demonstrators clash with members of Venezuelan National Guard during a rally demanding a referendum to remove Venezuela’s President Nicolas Maduro in San Cristobal, Venezuela October 26, 2016. REUTERS/Carlos Eduardo Ramirez


The region and Obama stand by impotently as Maduro drops all pretense of democratic rule.

Venezuela under the late socialist firebrand Hugo Chávez and his successors has been this century’s longest national train wreck — and the situation only continues to get worse. Colossal economic mismanagement, corruption, and political repression have led to the country’s across-the-board ruin. Indeed, the situation has grown so dire that international organizations are now raising alarm bells about a profound humanitarian crisis.

A new report from Human Rights Watch says: Severe shortages of medicines and medical supplies make it extremely difficult for many Venezuelans to obtain essential medical care. And severe shortages of food and other goods make it difficult for many people to obtain adequate nutrition and cover their families’ basic needs. This, in a country that reaped hundreds of billions of dollars in oil revenue over the last decade and longer. Meanwhile, not only does the government of Nicolás Maduro deny that there is any crisis, but Venezuelans who publicly criticize or protest conditions are being subjected to intimidation or violence by government goon squads.

It would be laughable if it were not so pitiable. Yet, Venezuela is poised to enter an even more unstable period, because the government has just removed the last vestige of the country’s democracy and is now ruling in full authoritarian mode. Last week, the government-controlled National Electoral Council abruptly canceled a recall referendum against the president as provided for in Hugo Chávez’s own constitution. The council claimed fraud in the collection of signatures but produced no evidence to substantiate the charge.

With upwards of 80 percent of Venezuelans supporting a recall of the president, an opposition win was near certain. The only uncertainty was when the recall would take place. According to the constitution, if the recall occurs in the first half of a president’s term (in this case, this year), then a new election must be held. If it’s the latter half (meaning 2017), then the vice president will assume power.

Although the opposition was pushing for a vote in 2016, a vote in 2017 to remove the hapless Maduro would still have been considered a victory, even though that would leave the ruling party (the current vice president or a new appointee) in power. Now, however, the opposition has lost the last sliver of hope to peacefully change the direction of the country. The regional reaction to what many are calling an “auto-golpe,” or self-coup, by the Maduro government, has been swift and condemnatory.

The spirited head of the Organization of American States, Luis Almagro, who has almost single-handedly led the regional charge against Venezuela’s serial violations of democratic norms, said: Only dictatorships deprive their citizens of rights, ignore the legislature, and hold political prisoners. . . . Today we are more convinced than ever of the breakdown of the democratic system. It is time to take concrete actions. Argentinean president Mauricio Macri called for Venezuela’s suspension from the southern trading bloc Mercosur for its violation of the group’s democracy clause. Peru’s president, Pedro Pablo Kuczynski, expressed his solidarity with Venezuelan protesters.

Here, Senator Marco Rubio has called for increased sanctions on Venezuela: The Venezuelan people have made it clear at the ballot box they are sick of Maduro’s incompetence and corruption at all levels of government, and have worked through the constitutional process to remove him, only to see him and his puppets on the supreme court and elections commission illegally squash the people’s will. The Obama administration should officially sanction Nicolás Maduro and every member of the commission that supported this illegal, unconstitutional and undemocratic decision.

For its part, the Obama administration issued a typically tepid statement, reiterating its “push for dialogue” and expressing its “deep concern” over the electoral council’s maneuver to suspend the recall process. In other words, Obama is recommending a dialogue between the opposition and a government that has jailed opposition leaders, deprived the opposition-controlled National Assembly of its constitutional powers, postponed gubernatorial elections in which the opposition was set to make major gains, and suppressed the only independent media outlets that gave the opposition a voice. In fact, a phony dialogue with the opposition is precisely what the Maduro government wants; it would allow Maduro to buy time while only pretending to resolve the crisis peacefully.

To that end, it has already ensnared the Vatican and some elements of the opposition into a meeting scheduled to take place this weekend. No one should be fooled. Obama is recommending a dialogue between the opposition and a government that has jailed opposition leaders. For now, the onus for action is on the opposition. This week, its members began major street demonstrations in Venezuelan cities to protest what citizens are calling the government’s “move toward an outright dictatorship.”

In the capital Caracas, protests are occurring even as the government tries to impede the throng by setting up roadblocks and shutting down mass-transit stations. That it has come to this dangerous standoff is a failure of regional governments to intercede as the Venezuelan government has systematically stripped away the façade of democratic rule. It’s also a signal failure of the Obama administration, which has clung to the spurious notion of a dialogue, well past its sell-by date. But Obama’s tolerating the bad behavior of tin-pot dictators like Maduro is less a policy than it is an ongoing apology for the perceived interventionist sins of the United States in Latin America over the years.

It is sad, however, to contemplate how many more Venezuelans will have to die while President Obama makes his self-glorifying ideological point. In the end, however, the likely result is that Venezuela’s crisis will be decided in the streets, which will not bode well for anyone.

— José Cárdenas served in senior foreign-policy positions at the State Department, the National Security Council, and the U.S. Agency for International Development during the George W. Bush administration, focusing on Latin America and the Caribbean.

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By Andrew Cawthorne and Alexandra Ulmer | CARACAS

Venezuela’s increasingly militant opposition stepped up its push to oust leftist leader Nicolas Maduro on Wednesday with protests that drew hundreds of thousands but also saw unrest leading to dozens of injuries and arrests.

In an incident sure to inflame the already polarized situation, a policeman died after being shot on Wednesday night in central Miranda state.

The government blamed opposition activists clashing with security forces on a highway out of Caracas. The police force of Miranda, whose governor is opposition leader Henrique Capriles, confirmed the death but did not link it to protesters.

Enraged by last week’s suspension of their push for a referendum to remove Maduro and determined to end 17 years of socialism in the South American OPEC nation, Venezuela’s opposition has sharply ramped up its tactics in recent days.

After launching a political trial against Maduro on Tuesday in the National Assembly, the opposition coalition held nationwide marches dubbed “Takeover of Venezuela” on Wednesday.

“This government is going to fall!” crowds chanted, many wearing white and waving national flags as they congregated at nearly 50 sites across the country.

“This needs to keep growing so that the government understands once and for all that we’re doing this for real,” said two-time presidential candidate Capriles, blaming authorities for what he said were over 120 people injured and some 147 protesters detained.

Clashes occurred in several cities outside Caracas, witnesses said, including the Andean city of Merida and the volatile western town of San Cristobal that was an epicenter of violence during 2014 anti-Maduro protests.

Opposition politicians and student leaders said there were protesters struck by bullets in Merida and San Cristobal as well as Venezuela’s second-largest city Maracaibo.

Rights group Penal Forum said there were more than 208 arrests nationwide, with 119 people still detained on Wednesday night. The government gave no figures on injuries or detentions.

Coalition leaders called for a national strike for Friday, and a Nov. 3 march to the Miraflores presidential palace in Caracas, unless the election board allows the referendum.

Maduro, the unpopular 53-year-old successor to Hugo Chavez who has presided over an unprecedented economic crisis, accuses the opposition of seeking a coup with U.S. help and has vowed there will be no plebiscite on his rule.

“They are desperate, they have received the order from the north to destroy the Venezuelan revolution,” he told a counter-march of red-shirted government loyalists.

Despite sitting on the world’s biggest oil reserves, Venezuela is in the throes of a punishing recession that has many poor families skipping meals amid scarce food and triple-digit inflation.

Foes say Maduro, a former bus driver and union leader who narrowly won election after Chavez’s death in 2013, is an incompetent autocrat who is to blame for the economic problems.

“I’m not scared of protesting. It’s the food lines that scare me, that’s where you see all the misery,” said health worker Auly Gonzalez, 36, as she and hundreds of others in the Punto Fijo city on a Caribbean peninsula marched to a naval base.


Maduro says low oil prices and a U.S.-led “economic war” against him are responsible for the recession, and has vowed to stand firm. “Maduro is not leaving!” several thousand supporters chanted at the government rally.

In apparent tactics to impede the opposition demonstrations, authorities set up roadblocks and closed some underground metro stations in Caracas. Reuters journalists in several cities reported big crowds at the opposition rallies, especially in the capital, collectively numbering hundreds of thousands.

Wary of trouble, many businesses stayed shut and some parents kept children away from school.

In San Cristobal, masked protesters threw rocks and petrol bombs in clashes with security forces and attacked the local headquarters of the electoral council in an attempt to burn it down, the body said.

Just back from a tour of major oil-producing countries, plus meetings with the Pope and U.N. Secretary General-designate Antonio Guterres, Maduro said his opponents were trying to reprise a brief 2002 putsch against Chavez.

“In Venezuela there will neither be a coup d’etat nor a gringo intervention,” Maduro roared to supporters.

With Venezuela’s key oil sector under government control and the economy in a tailspin anyway, the opposition’s planned strike would be unlikely to have a major financial impact.

Socialist Party deputy leader Diosdado Cabello warned that any company that joins the strike “would be taken over by workers and the armed forces,” drawing cheers from the audience at his weekly televised show.

A demonstrator walks past a burning tire during a rally demanding a referendum to remove Venezuela’s President Nicolas Maduro in San Cristobal, Venezuela October 26, 2016. REUTERS/Carlos Eduardo Ramirez

Opposition protests two years ago led to 43 deaths, including among security officials and government and opposition supporters. As a result, some Venezuelans are wary of demonstrations or see them as futile.

The poor have to prioritize the all-consuming task of finding affordable food, while many remain skeptical of the opposition, which has a reputation for elitism and whose internal squabbles have for years been a boon for “Chavismo.”

Maduro convened a special Committee for the Defense of the Nation at the presidential palace to analyze the National Assembly’s actions against him and a tentatively scheduled dialogue with the opposition this weekend.

National Assembly head Henry Ramos, a veteran politician who swaps insults with Maduro almost daily, declined an invitation to attend. “Here’s his chair, empty again,” said Maduro, urging participation in talks supported by the Vatican, regional bloc Unasur and various ex-heads of state.

Opposition leaders said they would not attend talks until the government allowed the referendum to proceed.

(Additional reporting by Andreina Aponte, Corina Pons, Diego Ore, Deisy Buitrago, Eyanir Chinea, and Girish Gupta in Caracas, Isaac Urrutia and Manuel Hernandez in Maracaibo, Mircely Guanipa in Punto Fijo, Anggy Polanco in San Cristobal; Editing by Lisa Shumaker and Sandra Maler)

Boko Haram Has The Nigerian Army Tied in a Knot

October 27, 2016


Nigerian Army troops clearing Boko Haram enclaves along Bitta to Tokumbere, Sambisa Forest, Borno state

In what appears an attempt to muddle up information about the disappearance of 83 soldiers after a Boko Haram attack, two senior officers of the Nigerian Army have given uncoordinated and contradictory statements on the matter.

While the man who officially speaks for the Nigerian Army claimed the army would not release true figures of the missing soldiers, a major general several hundred kilometres away said only “39” soldiers went missing in action.

PREMIUM TIMES had reported how 83 Nigerian soldiers, including a commanding officer, went missing after a major attack by insurgents.

Several of the soldiers, who fled their station due to the superior firepower of the terrorists, were later feared dead from drowning in the River Yobe.

On Wednesday, at two different interactions with the media, Army spokesman Sani Usman, and Lucky Irabor, the Theatre Commander of Operation Lafiya Dole in the north-east, issued different statements to reporters about the number of missing troops.

While Mr. Usman, a colonel, told an online news platform, Pulse Nigeria, that the Army would not disclose the number of missing soldiers, Mr. Irabor told reporters in Maiduguri that 39 soldiers were missing.

In his interview, Mr. Usman told Pulse Nigeria the Army issued a statement after the attack, but deliberately conceal information on the number of missing troops.

“We issued a statement of what happened,” he said. “We did not mention the number of soldiers that were missing.

“Eventually, we went to the theatre of war. But they didn’t bother to ask us that we should tell them the number of soldiers that were missing.”

Despite being pressed about the specific number of those missing, Mr. Usman remained elusive.

Apart from deflecting questions, Mr. Usman also charged this newspaper to justify the missing persons — completely absolving the Army of the responsibility to give names and figures of the missing uniformed men.

“Yeah, but the figures Premium Times reeled out are outrageous and not correct. I tried to make them understand that look, all you have to do is ask for information, not speculate, not say that everybody is a criminal because that is the way it looks like,” Mr. Usman said. “I declined to comment on the number Premium Times gave so that wherever they got that information, they should go and justify it.”

On his part, Mr. Irabor was quoted by the New Agency of Nigeria as saying that the Army declared 39 soldiers missing.

“It is true that about 39 soldiers were declared missing,” the major general said even though his statement was the first official one mentioning a figure of missing officials.

Mr. Irabor added that some of the soldiers had returned, but declined to provide figures, NAN reported.

”I want to inform you that a sizeable number of our soldiers have returned to base,” Mr. Irabor said. “I think it is only a handful that have not been found.”

Mr. Usman had in a different interview maintained that the Army will not release the number of missing soldiers to avoid complicating rescue efforts.

Notwithstanding, PREMIUM TIMES stands by its reports that 83 soldiers were feared missing in the attack, which also left some soldiers dead.

As with the missing, the Army had been silent on the number of dead soldiers from the attack.

On Wednesday morning, this newspaper reported that the Army had launched a probe into the Gashigar attack.

A lieutenant colonel, who is among those missing, has since been replaced by a captain, who is acting as commanding officer of the affected battalion.

The army’s refusal to come clean on the fate of the soldiers appears part of efforts to manipulate information to the public on the happenings in the north-east.

In December 2015, the Minister of Information and Culture, Lai Mohammed, asked the media to consider “national interests” when reporting Boko Haram attacks, a euphemism used by many governments to seek suppression of unfavourable reports.

“Acting in the national interest means not playing up reports of cowardly Boko Haram attacks on soft targets,” Mr. Mohammed said during a press briefing on Christmas Eve.

Also, following our exclusive report last Saturday about how soldiers were enduring months of unpaid salaries, with their allowances being held by their superiors, the Army hurriedly began paying them that same weekend.

A number of soldiers confirmed the development to PREMIUM TIMES.

Presently, family members of soldiers stationed at Gashigar are getting increasingly agitated because they had not been able to contact their loved ones.

PREMIUM TIMES learnt that telecom signals were not functional in the location, making it difficult for family members to confirm whether their loved ones were amongst those missing or not.

Boko Haram Attack: Top Army officials make contradictory claims on missing soldiers


Boko Haram Attacks Signal Resilience of ISIS and Its Branches

DIFFA, Niger — The military convoy was rumbling across a river near the border last month when soldiers suddenly realized they were surrounded. More than 100 Boko Haram fighters, some of them on horseback, had encircled the vehicles, ready to strike.

The 300 soldiers from Niger and the handful of American Special Operations forces accompanying them called for help. Soldiers from Chad rushed to the area, and fighter planes from Niger buzzed overhead, bombing the militants, killing some and sending others fleeing. This time, at least, the quick international teamwork averted what could have been a deadly militant ambush.


China Names Xi Jinping A “Core” Leader, Using Title Conferred on Mao Zedong

October 27, 2016

Officials at conclave designate the president as the ‘core’ of the leadership

An image of Chinese President Xi Jinping on display at an exhibition on the ‘Long March’ at a museum in Beijing. Mr. Xi has used an anticorruption drive to strengthen his hold on the Communist Party,
An image of Chinese President Xi Jinping on display at an exhibition on the ‘Long March’ at a museum in Beijing. Mr. Xi has used an anticorruption drive to strengthen his hold on the Communist Party, PHOTO: ANDY WONG/ASSOCIATED PRESS

BEIJING—Chinese President Xi Jinping emerged from a top-level Communist Party conclave with a new leadership title, signaling an expansion of his political authority—and his ability to smother simmering dissent.

Roughly 350 top party officials concluded a four-day meeting Thursday by declaring Mr. Xi as the “core” of the party’s leadership, using a designation conferred upon the country’s most exalted leaders, including Mao Zedong, but not Mr. Xi’s immediate predecessor.

The new designation suggests Mr. Xi has strengthened his grip over Chinese political life as the 89-million-member party heads into a potentially fractious year of bargaining over a new leadership lineup to be determined later in 2017.

During his first four years as head of the party, Mr. Xi has been named commander-in-chief of the military and used an anticorruption campaign to shake up the bureaucracy, cashier rivals and amass power. A result, however, has been discord within the party elite over management of a slowing economy and unease over Mr. Xi’s concentration of personal power.

“Xi seems to have amassed sufficient political capital to set himself rhetorically on a par” with his most powerful predecessors, said Daniel Leese, a professor of Chinese history and politics at Germany’s University of Freiburg. “Collective leadership thus by now seems to be no more than a facade, with Xi’s predominance clearly established.”

During the meeting, held at a military-run hotel in western Beijing, the party’s Central Committee bolstered Mr. Xi’s authority by adopting stricter disciplinary rules that reinforce his anticorruption campaign, including new directives on acceptable political behavior and stronger supervision.

In a lengthy statement issued at the end of the closed-door meeting, the Central Committee emphasized the importance of Mr. Xi’s new designation as the leadership’s “core.”

Security officials in front of a portrait of Mao Zedong at the Tiananmen Gate in Beijing. Some party members have been worried by Mr. Xi’s growing dominance, fearing it signals a shift toward the dictatorial style that marred Mao’s rule.
Security officials in front of a portrait of Mao Zedong at the Tiananmen Gate in Beijing. Some party members have been worried by Mr. Xi’s growing dominance, fearing it signals a shift toward the dictatorial style that marred Mao’s rule. PHOTO: QILAI SHEN/BLOOMBERG NEWS

All party members should “closely unite around the party center with Comrade Xi Jinping as the core… and unswervingly safeguard the party leadership’s authority and centralized unity,” according to the communiqué, which was carried by state media.

Since becoming party leader in late 2012, Mr. Xi has concentrated more power in his hands than his recent predecessors, upending the consensus-driven, collective leadership that has prevailed in recent decades.

A chief tool in Mr. Xi’s consolidation of power has been the anticorruption drive, in which the president has empowered the party’s discipline-inspection agency to target officials who resist the central leadership or waver in their loyalties.

While trying to exert greater control over the party, Mr. Xi has also sought to expand China’s influence abroad, turning it into a true global power. His government, though, has made only fitful steps in trying to restructure a flagging economy, weighed down by excess industrial capacity and corporate debt. Progress has been impeded partly by resistance from large state industries and by officials nervous about making decisions amid the corruption crackdown.

While the new designation as “core” leader boosts Mr. Xi, some political scientists said his authority isn’t undisputed and high-level resistance to his leadership is unlikely to fade.

“He has not established himself as a strongman, at least not yet,” said Steve Tsang,professor of contemporary Chinese studies at the University of Nottingham. “Xi is in a good position…but he is not in a position to dictate the direction” of next year’s party congress, where he must compete with rivals to place allies in top posts.

The “core” designation—previously applied to Mao, Deng Xiaoping and Jiang Zemin—was something that eluded Mr. Xi’s predecessor, Hu Jintao, whose decade as party chief is seen by critics as a period of indecisive leadership that allowed corruption, income inequality and environmental woes to worsen, even as the economy thrived. These problems convinced some in the party elite to seek a stronger, more decisive leadership, paving the way for Mr. Xi’s rise.

Early this year, senior officials in several provinces began to refer to Mr. Xi as the “core,” in what some political analysts saw as a trial balloon. The designation disappeared amid criticism from some party members, who were unsettled by Mr. Xi’s growing dominance and feared it signaled a shift toward the dictatorial style that marred Mao’s tumultuous rule.

The notion resurfaced this month, when a party-run magazine said Mr. Xi should be hailed as the “core” of the party leadership, arguing that a strongman leader is critical to China’s rise as a great power.

In hailing Mr. Xi’s new status, the party’s flagship newspaper, People’s Daily, portrayed it as crucial in guaranteeing the party’s leadership as it faces “a great struggle with many new historical characteristics.”

The move, People’s Daily said, “reflects the common desire of the entire party, entire military and people of every ethnicity.”

Write to Chun Han Wong at



Communist party bestows new title on president, putting him in a more powerful position before the 2017 congress

China’s president, Xi Jinping, has rapidly consolidated his power. Photograph by Aly Song, AFP, Getty

China’s Communist party has given the president, Xi Jinping, the title of “core” leader, putting him on par with previous strongmen Mao Zedong and Deng Xiaoping, but signalled his power would not be absolute.

A lengthy communique released after a four-day meeting of senior officials in Beijing emphasised the importance of collective leadership. The system “must always be followed and should not be violated by any organisation or individual under any circumstance or for any reason”, the party said.

But all members should “closely unite around the central committee with comrade Xi Jinping as the core”, said the document, released through state media.

The core leader title marks a significant strengthening of Xi’s position before a key party congress next year, at which a new standing committee, the pinnacle of power in China, will be constituted.

Since assuming office almost four years ago, Xi has rapidly consolidated power, including heading a group leading economic change and appointing himself commander-in-chief of the military, though as head of the central military commission he already controlled the armed forces.

While head of the party, the military and the state, Xi had not previously been given the title “core”.

Deng coined the phrase “core leader”, and said he, Mao Zedong and Jiang Zemin were core leaders, meaning they had almost absolute authority and should not be questioned. Xi’s immediate predecessor, Hu Jintao, was never called the “core”.

The plenum meeting paves the way for a congress, held every five years, in autumn 2017, at which Xi will further consolidate his power and which could indicate who may replace him at the 2022 congress.

A new standing committee, which currently has seven members and is the pinnacle of power in China, will be announced at the congress.

Zhang Lifan, a Beijing-based political commentator, said now that Xi was the “core”, things should go more smoothly for him at next year’s congress. But he would have more on the line, given his increased responsibility to answer for economic and social problems facing the leadership.

“If the economy continues to go downhill and the rifts in society become more serious, the responsibility of the core is greater,” Zhang said. “Your relative power and authority are greater, everyone is deferring to you. But they will be watching to see if your leadership is good or bad.”

An unofficial campaign to name Xi the “core” has been under way this year, with about two-thirds of provincial leaders referring to him as such in speeches, according to figures compiled by Reuters, before the plenum formally accorded him the title.

Steve Tsang, professor of contemporary Chinese studies at the University of Nottingham, said that although Xi remained in a strong position, there was still a year to go before the congress. “There’s still a lot of unanswered questions. Will his successor be named? Will Xi get a third term?”

Judging by recent past precedent, Xi should step down at the 2022 congress after a decade at the top, but speculation in leadership circles has swirled that he may try to stay on, perhaps giving up the post as president but remaining as party leader, the more senior of the posts.


Chinese Communist Party expands Xi Jinping’s political power, anointing him ‘core’ leader

The South China Morning Post

President’s elevated status will enable him to exert more influence on reshuffles at the top at next year’s party congress

Friday, October 28, 2016, 12:23am

Members of the Central Committee vote during their sixth plenum in Beijing this week. Photo: Xinhua

With his new core status, Xi is expected to play a more dominant role in orchestrating next year’s reshuffles – a sharp contrast to Hu’s position 10 years ago.

Next year’s congress will see the election of more than 300 full members and alternate Central Committee members. Up to 11 seats on the 25-strong Politburo will also be vacated, including up to five members of the seven-member Politburo Standing Committee who are expected to retire.

Unlike the official title “general secretary”, the term “core” and its powers are not defined by party regulations.

Beijing-based political commentator Zhang Lifan said the new reference meant Xi was guaranteed to have unchallenged authority in the party.

“It means Xi has the final veto power. It’s the official crowning of his real power,” Zhang said. “It also means the end of the last ‘core’, Jiang Zemin. There can’t be two cores in the party.”

It means Xi has the final veto power. It’s the official crowning of his real power

Jiang, 90, is widely believed to have exercised influence in mainland politics since his official retirement in 2004 and has been seen in public recently.

But Zhang said Xi’s crowning moment also comes with uncertainties. “It’s unclear if all senior leaders will obey him and it would mean more responsibility for him, including the downward economic pressure and rising social conflicts,” he said.

The communiqué also singled out members of the Central Committee, the Politburo and the innermost Politburo Standing Committee as the prime targets for the new conduct rules, making it clear that senior cadres would be judged on whether they toed the line on party positions.

Senior cadres must not fudge their stand on fundamental matters

“Senior cadres must not fudge their stand on fundamental matters, must not waiver on their political stance, must not be affected by incorrect ideology,” it said.

It said no organisation or individual was above party discipline and the party strictly forbade anyone from bargaining with the party or disobeying its decisions.

To stem corruption, the party would address election fraud and end the buying and selling of official posts and vote rigging.

Leading officials were banned from using their positions to seek benefits for friends and family, it said.

On the party’s internal political life, the statement said the party would unswervingly continue its collective leadership system and the senior leadership had to consult party members on ­major policies.

The communique said a Central Committee full member and three alternate members had been expelled from the party, while two alternate members had been promoted to full members.

Philippines Senator de Lima Questions President Dutert’e Thinking on Scarborough Shoal, South China Sea

October 27, 2016

The Philippines does not need China’s permission to fish in Scarborough, Senator Leila de Lima says….

Senator Leila de Lima accused President Rodrigo Duterte of attempting to appease China by allegedly “trying to dilute” an international tribunal’s ruling on the West Philippine Sea dispute between the two countries.

In a media briefing Thursday, De Lima criticized Duterte for allegedly diminishing the gains of the Philippines’ victory against China in the South China Sea, parts of which Manila refers to as the West Philippine Sea.

“Huwag natin waldasin ‘yung gains na nakuha natin, ‘yung victory, ‘yung triumph natin in that monumental case na nabilib sa atin ang buong mundo na ginawa natin ‘yun at nanalo tayo dun,” De Lima said.

“Tayo pa mismo ang nagmamaliit doon sa significance ng ruling na ‘yan just to appease China,” she added.

After his state visit to Beijing last week, Duterte said he “will not impose now” on finding a resolution to the Philippines’ territorial dispute with China.

“I will not insist now. I will not impose now. I will not go to war now. I will not waste the lives of my soldiers,” Duterte said.

In contrast, De Lima said the government should instead be asserting the ruling released by the Permanent Court of Arbitration last July.

“Dapat nasa period dapat tayo ng enforcement or assertion of the ruling pero ginagawa ba natin? Hindi,” she said.

“Parang baliktad ang ginagawa ngayon ng Pangulo. Siya mismo ang nangunguna in trying to dilute if not weaken the import and significance of that ruling,” De Lima added.

De Lima said if former President Benigno Aquino III was still the chief executive, he would now be soliciting the support of the international community.

Tthe Philippines had filed the arbitration case against China during Aquino’s term.

“Kung si president PNoy pa rin ang pangulo, yan ang ginagawa niya ngayon to enforce, to try to enforce, try to seek and solicit the support of the international cmmunity to put the pressure on China to recognize the ruling of the arbitral tribunal,” she said.

De Lima reminded Duterte of the possible “consequences” of his statements concerning the Philippines’ territorial claims.

“He may be held accountable under the Constitution,” De Lima said as she agreed with the opinion of Supreme Court Associate Justice Antonio Carpio that giving up the country’s sovereignty over the Panatag (Scarborough) Shoal could be a ground to impeach Duterte.

De Lima said Filipino fishermen do not need the authority of China to fish in the disputed Panatag Shoal, which is located 124 nautical miles west of Zambales.

“Hindi yan pag-aari ng China, hindi rin ng Pilipinas pero may common rights to fish and utilize, exploit the resources in the Scarborough Shoal,” she said. — VVP, GMA News


De Lima questions need for China’s permission to fish in Scarborough

Sentor Leila de Lima during the Kapihan sa Senado. Twitter/Leila de Lima

MANILA, Philippines — Sen. Leila de Lima on Thursday questioned the need for President Rodrigo Duterte to go to China and ask for permission to access the Scarborough Shoal, which is also called Panatag and Bajo de Masinloc.

According to de Lima, the Philippines does need to ask for China’s permission since an international arbitral tribunal ruled that Scarborough Shoal is a traditional fishing grounds for Filipino, Chinese, Vietnamese fishermen as well as those from other countries. China has rejected the ruling and the arbitration case that the Philippines filed in 2013.

“May common rights to really fish and to utilize, exploit the resources in the Scarborough Shoal,” she said at a press forum at the Senate on Thursday.

The Philippine government has held that the shoal is “an integral part of the Philippine territory” under Masinloc town in Zambales. It is is within the country’s 200-km Exclusive Economic Zone. China has had de facto control of the shoal since 2012 after a standoff between Philippine and Chinese vessels there.

De Lima said that instead of rallying and soliciting support from the international community, the president is doing the opposite by “trying to dilute, if not weaken, the import and significance of that ruling.”

The senator gave her unsolicited advice to the president to be careful with his pronouncements, moves, and actions, as there is jurisprudence.

“Pronouncements by officials, state officials, particularly the head of state himself can be binding,” de Lima said.

De Lima also warned that there are consequences, and that Duterte may be held accountable under the Constitution.

De Lima added that Supreme Court Senior Associate Justice Antonio Carpio already warned the president about it, and said that she completely agrees.

“He certainly knows what he is talking about and I agree with him completely,” she said. Duterte has also acknowledged that Carpio is right and said that he is not giving up Philippine territory.

De Lima said that the Philippines is now in the period of enforcement and assertion of the ruling, and that there should already be concrete moves and actions on how to assert the right of the Philippines recognized by the Arbirtal Tribunal.

The Philippines and China have agreed to hold bilateral talks on the sea dispute.



Canada hails Belgian breakthrough on trade deal

October 27, 2016


© AFP | Resistance from Belgium’s French-speaking Wallonia region had threatened to derail the pact between the 28-member bloc and Canada, the world’s 10th biggest economy

OTTAWA (AFP) – Canada on Thursday hailed a deal reached by Belgian political leaders to break the logjam over a landmark trade deal between the EU and Canada, but cautioned there is more work ahead.Resistance from Belgium’s French-speaking Wallonia region had threatened to derail the pact between the 28-member bloc and Canada, the world’s 10th biggest economy.

But Belgian Prime Minister Charles Michel on Thursday announced an agreement had been reached with Walloon leaders in support of the CETA deal.

“If it materializes, it’s excellent news,” Canadian Foreign Minister Stephane Dion said during a visit to Paris, adding he was “cautiously optimistic.”

His counterpart Jean-Marc Ayrault added, “If it is confirmed, we are very happy about it.”

A spokesman for the Canada’s Trade Minister Chrystia Freeland, however, commented in an email to AFP, “There is still work to do. There remain additional steps before signing.”

“Canada remains ready to sign this important agreement when Europe is ready,” Freeland spokesman Alex Lawrence said.

The CETA pact would link the EU’s single market of 500 million people — the world’s biggest — with Canada, the world’s 10th largest economy.

“I am cautiously optimistic — once bitten, twice shy,” said Dion.

“We will show it is possible to trade and have progressive policies for the environment, health and social policies.”

The leaders of Wallonia, a 3.5 million-strong region south of Brussels, had demanded guarantees that CETA will not harm local farming and other interests.

China capital flight flashes warning as authorities forced to prick property bubble

October 27, 2016


China’s property market went mad after the authorities poured fuel on the flames. Beijing is now slamming on the brakes.

By Ambrose Evans-Prichard
The Telegraph

Xi Jinping, the Chinese president, emerges from a key Communist party meeting with a stronger mandate and new powers to sidestep his own government

Chinese President Xi Jinping, centre, during the third Plenary Session of the 18th CPC Central Committee in Beijing Photo: AP/XINHUA

Capital outflows from China are accelerating. The hemorrhage has reached the fastest pace since the currency panic at the start of the year.

The latest cycle of credit-driven expansion has already peaked after 18 months. Beijing has had to slam on the brakes, scrambling to control property speculation that the Communist authorities themselves deliberately fomented.

How this episode could have happened is astonishing, given that premier Li Keqiang has warned repeatedly that excess credit is becoming dangerous and will ultimately doom China to the middle income trap.


It will be clear by early to mid 2017 that the economy is rolling over and that the underlying ‘quality of growth’ has deteriorated yet further. “We think the recovery will run out of steam early next year,” said Chang Liu from Capital Economics.

This stop-go rotation – an all-too familiar pattern – coincides with an incipient liquidity squeeze in global finance as dollar LIBOR and Eurodollar rates ratchet upwards. A rate rise by the US Federal Reserve will clinch it.

Since the commodity rebound is in great part driven by demand for Chinese industry and construction – and by a touching belief that China’s economy will sail majestically through 2017 – this looming slowdown spells trouble.

Stress is already visible in the capital account. Morgan Stanley estimates that net outflows reached $44bn in September. Capital Economics thinks the figure was closer to $55bn, led by a surge in purchases of off-shore securities through the Shanghai-Hong Kong Stock Connect Scheme.

This does not yet match the capital flight seen late last year when a mismanaged shift in exchange rate policy set off outflows averaging $70bn a month, and triggered the global equity rout of January and February. But it is nearing a neuralgic threshold for currency traders.

Beijing is clearly alarmed. Nikkei’s Yusho Cho reports that the authorities have ordered banks in Shanghai and Guangzhou to restrict access to foreign currency, and have imposed a “gag order” to keep it quiet.

Institutions must now justify why they need foreign exchange. The worry is a “negative feedback loop between a weakening yuan and capital flight”.

US dollar funding cost are ratcheting up, tightening global conditions CREDIT: IMF

The central bank (PBOC) spent roughly $50bn defending the yuan last month, but this has not stopped the exchange rate sliding to 6.77 against the dollar – the weakest in six years.

The PBOC has burned through $800bn of foreign reserves since mid-2014, when they peaked at $4 trillion. It still has ample fire-power but bond sales automatically tighten China’s internal monetary policy since it is hard to sterilize the effect, and tightening may the last thing they want if the economy is slowing hard next year.

“Our view is that the RMB (yuan) will depreciate 20pc against the US dollar to 8.1 by the end of 2018 as deflation of the property bubble leads to more capital outflows,” Zhiwei Zhang from Deutsche Bank. “This is deflationary for global trade.”

That is an understatement. A Chinese devaluation on this scale would be an earthquake for the world’s economic and financial system, unleashing a tsunami of cheap manufacturing exports into Europe and the US. It would silence all talk of global reflation. Bond yields would fall even further.

Ouflows from China in the form of direct investment is increasing fast, and may disguise capital flight CREDIT: CAPITAL ECONOMICS

Beijing is trying to curb excess capacity across a swathe of sectors from steel to shipbuilding,  chemicals and solar panels, but regional party bosses and vested interests largely do as they please.

Caixin reports that steel plants are “conjuring up” figures, listing long-closed production lines and “dead factories” as fresh cuts. Much of the 36m tonnes of reduction in steel capacity claimed this year is fiction. It is probably the same story in other industries.

The fact remains that fixed capital investment in China is running near $5 trillion a year, as much as in Europe and North America combined. The world cannot absorb the consequences of so much excess plant.

Premier Li Keqiang and PBOC vowed in January to keep the exchange rate “basically stable” in trade-weighted terms. “China has no intention of stimulating exports through competitive currency devaluation,” said Mr Li.

Chinese officials repeated the same message vehemently in my presence in Davos. For whatever reason – necessity or opportunism – the solemn pledges have been breached. The yuan has fallen 8pc over the last year. Economists in China talk openly about a “strategic devaluation” as if it were the established policy.

China’s yuan has been depreciating steadily, despite pledges by Beijing to hold it stableCREDIT: JP MORGAN

For now, the economy is firing on all cylinders. Capital Economic’s proxy gauge suggests that growth has surged to 5.6pc from 4.4pc in the middle of the year. Nomura’s heat-map has 74pc of its indicators “flashing hot”, up from 55pc in July, 39pc in May, and 19pc in April.

Yet it is deformed growth. Investment by private companies has stalled. Credit efficiency has collapsed. Loan are propping up derelict structures, perpetuating the imbalances. The stimulus has been cornered the state-owned industrial dinosaurs, or gone into the housing market.

Zhiwei Zhang says Beijing has repeated the error it made by talking up the stock market in early 2015, when it caused a stampede into equities (thinking this a clever way to switch from debt to equity funding). It ended in debacle.

In June of this year, the State Council stated that households could “leverage up” on property, supposedly to “help the corporate sector lower their leverage”.  Whatever they were thinking, the net effect was to draw yet more people into the quagmire.

This  State Council endorsement was the green light for a final the blow-off in a country where people are highly attuned to signals from the Communist Party. Down payments for mortgages were cut to 20pc, and to 30pc for second homes.  Both buyers and developers seized on the latest Beijing ‘Put’ with alacrity.

Mortgages made up 71pc of all loans in July and August, up from 26pc last year. Land prices have risen 140pc this year, and in some places are even higher than the equivalent sales prices of finished apartments nearby, a pattern aptly described in China as “flour being more expensive than bread”.

Chinese mortgage loans have exploded over the last four months CREDIT: CAPITAL ECONOMICS

The bubble went mad in September. Home prices in Shanghai rose 5pc in one month. Over the last year they have risen 28pc in Bejiing, 33pc in Shanghai, 37pc in Xiamen, and 47pc in Hefei.

The authorities are belatedly scrambling to restore sanity. Developers face curbs on borrowing from banks, trust funds, or capital markets to buy land. They can no longer issue bonds, or raise money in Hong Kong.

Minimum down payments for buyers have been lifted to 50pc, and 70pc for second properties. Curbs have been imposed in the big ‘tier I’ and tier 2 cities, and measures are spreading to other parts of the country.

As real estate lurches from boom to probable bust, developers will be left sitting on $1.1 trillion of debt, similar to the US subprime bubble in 2007. How this will end is anybody’s guess. Vacancy rates are as high as 40pc the North Eastern cities if the builders’ inventories are included.

Property prices have soared this year after the government deliberately fomented a boom CREDIT: DEUTSCHE BANK

The risks of China’s debt addiction are spelled out in the International Monetary Fund’s Global Financial Stability Report. It warned that the country has a ‘credit overhang’ of 22pc to 27pc of GDP, over five times the level that usually precedes a financial crisis.  Bank exposure to “shadow” credit products – China’s equivalent of junk instruments – jumped by 50pc last year to $6 trillion.

But what really worries the IMF is that reliance on “wholesale funding” has jumped to 30pc,  mostly in the overnight and one-week repo markets.  “Borrowers must roll over their liabilities on average almost daily, whereas funded credit products have mostly longer maturities. This maturity mismatch makes borrowers highly vulnerable to a sudden liquidity crunch,” it said.

“This is the Achilles Heel of the Chinese financial system. It isn’t just the level of debt, it is the source of funding,” said George Magnus from UBS. It was dependence on wholesale funding that doomed Northern Rock and Lehman Brothers. Such financing is inherently prone to sudden seizures.

We will find out soon enough whether China can deliver yet another calibrated soft-landing, this time with a record debt load of 255pc of GDP. The leakage of capital is already telling us that Chinese investors have their doubts.


UK and Brexit: Slowdown in the economy will be much milder than previously feared

October 27, 2016


Philip Hammond, the Chancellor

By Tim Wallace
The Telegraph


Britain’s economy expanded by 0.5pc in the three months following the EU referendum, slowing down a touch from the 0.7pc growth recorded in the previous quarter but defying the most pessimistic predictions made by the Remain campaign.

The country’s economic performance was stronger than the 0.3pc predicted by economists, and in line with the official forecasts made before the referendum took place – in March the Office for Budget Responsibility predicted third quarter growth of 0.5pc.

It also disproves the Treasury’s referendum campaign claim that a vote to leave the EU would result in 0.1pc fall in GDP in the third quarter that would herald the start of a recession. The Treasury’s worst-case “severe shock” scenario was even more pessimistic, predicting a 1pc fall in the three-month period.

Quarterly GDP growth, %The economy grew faster than expected in Q3Source: ONSGDP growth2013 Q12013 Q22013 Q32013 Q42014 Q12014 Q22014 Q32014 Q42015 Q12015 Q22015 Q32015 Q42016 Q12016 Q22016 Q30.

Sterling rallied on the initial estimates from the Office for National Statistics, and economists said the unexpectedly strong numbers made it less likely that the Bank of England’s monetary policy committee (MPC) would cut interest rates at next month’s monetary policy committee meeting.

The dominant services sector grew by 0.8pc in the third quarter, but the other major sectors all contracted – construction fell by 1.4pc, agriculture by 0.7pc, and production – which includes industries such as mining and waste management – by 0.4pc. Within that, manufacturing output dropped by 1pc.

The pound jumped sharply on the unexpectedly strong GDP figures
The pound jumped sharply on the unexpectedly strong GDP figures CREDIT: BLOOMBERG

“The fundamentals of the UK economy are strong, and today’s data show that the economy is resilient,” said Philip Hammond, the Chancellor. “We are moving into a period of negotiations with the EU and we are determined to get the very best deal for households and businesses.

“The economy will need to adjust to a new relationship with the EU, but we are well placed to deal with the challenges and take advantage of opportunities ahead.”

Quarterly growth, %Only the services sector expanded in Q3Source: ONSGrowthGDPAgricultureProductionConstructionServices-2-1.5-1-0.500.51

Enthusiastic consumer spending led the way, with retail output up 1.8pc, accommodation and restaurants up 1.7pc, and the category including cinema ticket sales booming by 16.4pc, the ONS said.

Surveys of businesses since the referendum have revealed an increasing reluctance to launch large investment projects.

Companies have remained keen to hire workers, however, with employment hitting a new record high in August.


Economists now believe that any slowdown in the economy will be much milder than previously feared.

“We only expect GDP growth to slow from about 2pc this year to about 1.5pc in 2017,” said Ruth Gregory at Capital Economics. “We had previously thought that there was a decent chance of a further rate cut at next week’s MPC meeting, but today’s upbeat figures mean that this is now less likely – for the time being at least.”

Anna Stupnytska at Fidelity International said: “Given the easing in financial conditions on the back of the lower pound, the economy might well manage to avoid recession next year.

“Fiscal stimulus in the form of infrastructure investment and some measures to boost consumer spending and business investment, perhaps involving tax cuts, would also go some way towards limiting the Brexit fallout in the short-to-medium term.”

One key worry is that the fall in the pound will push up prices for shoppers next year, denting their spending power.

As consumers were a key driver of the growth in the third quarter, this could hit the main engine of growth currently.

“We continue to expect the economy to slow markedly. The impending rise in headline inflation is set to squeeze households’ real income, thereby reducing consumer spending growth,” said Dominic Bryant at BNP Paribas.

“Moreover, surveys of investment intentions continue to suggest some weakness, particularly in the service sector.”

Annual change, %Economists expect inflation to pick up next year,squeezing consumersSource: ONS, Treasury compilation of economic forecastsWage growth year on yearConsumer price inflation year on yearWage forecastInflation forecast2010201220142016-2.502.557.5

It also remains the case that the Brexit process has barely begun and the specific terms of Britain’s future relationship with the EU are not yet known, so more turmoil could be ahead.

“Economic resilience boosts ‘hard Brexit’ risk – with the economy slowing far less than the “Remain” campaign had suggested, Brexit supporters in the government will likely feel vindicated and insist on a swift and decisive rupture of the ties with the EU,” said Christian Schulz at Citi.

“We believe that would limit the chances that the government can make the necessary compromises to organise a smooth Brexit.”

Russia’s Putin Says Cyber Attacks Are Unacceptable

October 27, 2016

OCT. 27, 2016, 11:39 A.M. EDT

KRASNAYA POLYANA — Russian President Vladimir Putin said on Thursday that cyber attacks or other types of interference in other countries’ internal affairs were intolerable.

The U.S. government has formally accused Russia of a campaign of cyber attacks against Democratic Party organizations in the run-up to the U.S. presidential election.

Russian officials have denied those allegations.

(Reporting by Gleb Stolyarov; Writing by Maria Tsvetkova; Editing by Andrew Osborn)