Posts Tagged ‘U. S.’

China Drifts Into a U.S. Vacuum in Asia

March 28, 2017

Beijing builds its influence in Asia by default, not design, as Trump retreats

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Updated March 28, 2017 6:06 a.m. ET

BOAO, China — For more than half a century, Washington has set the economic agenda for the Asia-Pacific, where global wealth, technology and military power are concentrating.

Today, increasingly, Beijing does.

That’s not because its economic model…

https://www.wsj.com/articles/china-drifts-into-a-u-s-vacuum-in-asia-1490695181

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China Touts Its Own Trade Pact as U.S.-Backed One Withers
https://www.wsj.com/articles/china-touts-its-own-trade-pact-as-u-s-backed-one-withers-1479811275

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From Sputnik

Is China Filling the Economic Vacuum in the Pacific?

© REUTERS/ David Gray

“The bilateral relationship between China and the United States is the single most important one for the prosperity and security and stability of the world, and the fact that we have very strong relationships, but different relationships — different in context and in terms of history — with both the United States and China, that is a great strength.”

Premier of the State Council of the People's Republic of China Li Keqiang and Prime Minister Malcolm Turnbull. Picture: AAP

Premier of the State Council of the People’s Republic of China Li Keqiang and Prime Minister Malcolm Turnbull. Picture: AAPSource:AAP

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Premier Li agreed, saying China-Australia co-operation was not targeted “at any third party” and would benefit other countries and regions

“It is China’s consistent position that all countries, big or small, are equal members of the world, and there needs to be mutual respect and co-operation on an equal footing,” Premier Li said.

Chinese Premier Li Keqiang is visiting Australia and New Zealand this week, while US relations with Australia cool over the migrant deal negotiated by the former US administration. Will China fill the vacuum in the region? Radio Sputnik’s Brian Becker invited China expert Keith Bennett to discuss the issue.

China Expected to Import $8 Trillion Worth of Goods in 2016-2020

US President Donald Trump’s relations with Australian Prime Minister Malcolm Turnbull had a rough start. During their first phone talk, an apparently emotional exchange, Trump declined to fulfill the deal negotiated by the administration of former President Barack Obama in which the US pledged to take more than 1,000 immigrants from Australian detention centers.

“The Obama administration agreed to take thousands of illegal immigrants from Australia. Why? I will study this dumb deal,” Trump tweeted after the phone call to Turnbull, which he reportedly ended abruptly

In general, it becomes more and more likely that the US is disconnecting itself from active foreign policy and concentrating on its internal affairs. This allows for other nations to seek new opportunities for trade that had been unavailable for them. One might think the time is ripe for China to approach the Pacific with propositions of trade.

However, China already is significantly involved in trade with New Zealand and Australia, according to China expert Keith Bennett.

“China has very good relations with the two countries, at least on the economic level,” Bennet told Becker. “Politically, it’s more complicated, but this is not an unprecedented visit.”

According to various data from open sources, China’s share in New Zealand trade seems to be already twice as big as that of the US. The same goes for Australia, whose exports to China are several times larger than those to the US.

This creates a complicated situation in which Australia is a close military ally of the US, but its economic interests naturally go along with China and other Pacific nations, says Bennett.

“There is a dichotomy between the economic factor and a political and military security factor,” he says.

According to Bennett, the United States relies heavily on political and military force to prevent Australia’s drift towards China, even using political means to organize a “soft coup” to get rid of Prime Minister Kevin Rudd. The Obama administration also increased its military presence in Australia for the very same purpose: to send a signal to Australia not to get too friendly with China, Benett explains.

Given all that, it would be hard to imagine a sharp move by Australia toward China, but there are signs it could happen under the Trump administration. The United States under Trump seems to be stepping back from its role of global director of trade and finances — at least for capitalist countries — a role the US has taken since 1945 Bretton Woods agreement. Bennet said this shift by the US could create a situation in the Pacific in which close trade ties of those nations with China could finally result in corresponding political closeness.

“What we are entering is a very unstable period of convulsion and realignment,” Bennet noted. “So it’s hard to make predictions, but I think… that economic changes will come first and political changes will have to catch up.”

https://sputniknews.com/asia/201703251051966155-china-new-zealand-australia-trade/

See also:

http://www.news.com.au/finance/work/leaders/chinese-premier-meets-with-malcolm-turnbull-downplays-south-china-sea-tensions/news-story/bb41415200c089f62847e2c9b2ab0c9f

U.S. Boosts Military Backing for Saudi-Led Coalition in Yemen

March 27, 2017

Support for Riyadh, U.A.E. mainly aimed at helping fight al Qaeda but also helps counter Iran’s influence

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March 27, 2017 5:59 p.m. ET

WASHINGTON—The Trump administration has significantly increased military support for Sunni Arab states fighting al Qaeda and Iranian-backed militias in Yemen, said U.S. and Arab officials, drawing the U.S. deeper into the two-year civil war there.

American support now includes greater intelligence and logistical support fo

https://www.wsj.com/articles/u-s-boosts-military-backing-for-saudi-led-coalition-in-yemen-1490651993

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U.S. weighs bigger role in Yemen’s war, boosting aid to allies

Reuters
Monday, 27 March 2017 22:44 GMT

By Phil Stewart

WASHINGTON, March 27 (Reuters) – The United States is considering deepening its role in Yemen’s conflict by more directly aiding its Gulf allies battling Iran-aligned Houthi rebels, officials say, potentially relaxing a U.S. policy that limited American support.

The review of potential new U.S. assistance, which includes intelligence support, would come amid increasing evidence that Iran is sending advanced weapons and military advisers to the Houthi movement, a Shi’ite ally.

Any elevation in U.S. support could be seen as a sign that President Donald Trump’s administration has made confronting Iran and its allies an early priority.

For the moment, however, any increase in direct U.S. assistance may be restricted to non-lethal measures and there was no sign the United States was considering waging strikes on Houthi targets, for example.

Trump’s predecessor, Barack Obama, increasingly sought to limit U.S. ties to the civil war in Yemen and his administration became unnerved by civilian casualties caused by the Saudi-led coalition, which have come under intense international scrutiny.

Yemen’s conflict has claimed the lives of more than 10,000 people and pushed the impoverished country to the brink of famine.

Critics of U.S. participation in the conflict, which has included arms sales to Saudi Arabia and refueling of Saudi-led coalition jets, say Washington carries some of the blame for the civilian fallout.

“The U.S. should not escalate our military involvement in a civil war in Yemen halfway around the world without any explanation by the president of what we are doing there and what is our strategy,” said Representative Ted Lieu, a Democrat from California and a longtime advocate in Congress for a suspension of U.S. cooperation with the Saudi-led coalition.

MEMO FROM MATTIS

Trump’s defense secretary, Jim Mattis, wrote a March memo to the White House advocating limited support for operations by Gulf partners, officials told Reuters, speaking on condition of anonymity.

One of the officials said the United States was examining offering the United Arab Emirates, for example, U.S. intelligence, surveillance and reconnaissance assets and information sharing.

The memo was first reported by the Washington Post and comes amid a broader U.S. review into its policy in Yemen, which for years has been seen almost entirely seen through the prism of America’s fight against al Qaeda.

Al Qaeda’s affiliate in Yemen, al Qaeda in the Arabian Peninsula, has taken advantage of Yemen’s war pitting the Houthis against the Saudi-backed government of President Abd-Rabbu Mansour Hadi to try to broaden its wealth and power.

Iran rejects accusations from Saudi Arabia that it is giving financial and military support to the Houthis in the struggle for Yemen, blaming the deepening crisis on Riyadh.

But Iran’s role in Yemen has increasingly been the focus of U.S. policymakers since the United States struck Houthi targets with cruise missiles in October in retaliation for failed missile attacks on a U.S. Navy destroyer.

U.S. officials say the Houthis have benefited from Iranian-provided know-how and weaponry, including ballistic missiles.

The proposed U.S. support could allow America to aid an eventual push on the western port city of Hodeidah, which is under the control of the Houthis.

It is near the Bab al-Mandab strait, a strategic waterway through which nearly 4 million barrels of oil are shipped daily.

Obama’s administration was long wary of operations involving the port, given its strategic importance as a vital gateway for humanitarian supplies, and last year rejected a proposal to assist its Gulf allies in a push for the port. (Reporting by Phil Stewart; Editing by James Dalgleish)

Foreign Investors Flock to Iran as U.S. Firms Watch on the Sidelines

March 27, 2017

European and Asian firms vie for lucrative deals while American companies are wary of entering the market; 15 face sanctions

An Iranian technician with door parts for Peugeot cars at a Iran Khodro auto plant west of Tehran.

An Iranian technician with door parts for Peugeot cars at a Iran Khodro auto plant west of Tehran. PHOTO: BEHROUZ MEHRI/AFP/GETTY IMAGES

After years shunning Iran, Western businesses are bursting through the country’s doors.

France’s Peugeot and Renault SA are building cars. The U.K.’s Vodafone Group PLC is teaming up with an Iranian firm to build up network infrastructure. Major oil companies including Royal Dutch Shell PLC have signed provisional agreements to develop energy resources. And infrastructure giants, including Germany’s Siemens AG, have entered into agreements for large projects.

After Iran’s nuclear accord with world powers lifted a range of sanctions, many foreign investors began to push into the promising market of 80 million people, setting off skirmishes among European and Asian companies eager to gain a step on more-cautious U.S. competitors.

Peugeot Middle East chief Jean-Christophe Quémard says his company’s early entry has left U.S. rivals in the dust. “This is our opportunity to accelerate,” he said in February.

U.S. companies are at risk of losing lucrative deals to early movers into the Iranian market, analysts say. But as latecomers, the companies likely won’t face a learning curve in dealing with the political risks and the bureaucratic difficulties in Iran.

Apple Inc. explored entering Iran after the Obama administration allowed the export of personal-communications devices in 2013, according to people familiar with the matter. But the company decided against it because of banking and legal problems, these people said. Apple declined to comment.

U.S. companies usually need special permission from the Treasury Department to do business with the country. So though Chicago-based Boeing Co. got the go-ahead to sell 80 aircraft valued at $16.6 billion to Iran last year, the list of American companies with significant Iranian deals is a short one.

Further complicating matters for U.S. companies: President Donald Trump threatened to rip up Iran’s nuclear deal during his campaign, and he hit the country with new sanctions shortly after taking office. On Sunday, Iran imposed its own sanctions on 15 U.S. companies, mainly defense firms.

The nuclear deal removed a range of U.S., European Union and United Nations sanctions in 2016 that had held back Iranian energy exports and put the brakes on foreign investment. In exchange, Tehran agreed to curbs on its nuclear program. But while food, medicine and agricultural products are exempted from U.S. restrictions, U.S. products are available in Iran often only through foreign subsidiaries or third-party importers.

Two of the world’s biggest auto makers, Ford Motor Co. and General Motors Co., have steered clear of Iran since the nuclear deal. A spokeswoman for Ford said the company was complying with U.S. law and didn’t have any business with Iran. GM is focusing “on other markets, and other opportunities,” said spokesman Tony Cervone.

Meanwhile, Peugeot, officially known as Groupe PSA SA, is aiming to hit annual production of 200,000 cars in Iran by next year in conjunction with its partner Iran Khodro, after the two signed a €400 million ($432 million) joint-venture agreement in June. Already, the pace of both Peugeot’s and Renault’s car sales in Iran has more than doubled. In February, Renault sold 15,230 vehicles in Iran, up 175% from a year earlier.

Center, Carlos Tavares, chairman of the managing board of Groupe Peugeot with  Iran Khodro’s Hashem Yeke Zare, second from right, and Iranian deputy minister of industry, mine and trade, Mohsen Salehinia, right, at a management meeting in Tehran in last fall.

Center, Carlos Tavares, chairman of the managing board of Groupe Peugeot with Iran Khodro’s Hashem Yeke Zare, second from right, and Iranian deputy minister of industry, mine and trade, Mohsen Salehinia, right, at a management meeting in Tehran in last fall. PHOTO: FATEMEH BAHRAMI/GETTY IMAGES
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On a recent visit in Tehran’s biggest hotels, lobbies were full of foreigners huddling with prospective Iranian partners. A packed automotive conference in February drew top executives from Peugeot, Renault and Citroën. The same day, the Swedish prime minister was visiting a Scania truck factory west of the capital after the company’s deal to supply Iran with 1,350 buses.

Iran has caught the attention of a broad spectrum of investors beyond autos, with foreign companies selling everything from gas-powered turbines to mining technologies in the country.

Government-approved foreign direct investment shot up to more than $11 billion last year, official figures show, from $1.26 billion in 2015. Pedram Soltani, the vice president of Iran’s Chamber of Commerce, said more than 200 foreign business delegations have visited Iran since the nuclear deal took effect.

“We see what’s happening in the U.S. and Mr. Trump’s comments,” says Ghadir Ghiafe, an Iranian steel-industry executive who is exploring partnerships with South American and European companies. “Our businessmen don’t pay much attention to it.”

Foreign companies still face daunting obstacles to doing business in Iran. Iran placed 131st out of 176 countries for corruption in a ranking by Transparency International last year. It also has major economic problems, including high unemployment and a banking system saddled with bad loans.

Large international banks remain reluctant to re-establish links with Iran despite the nuclear deal. That reluctance has made transfers of money into and out of Iran a challenge. Western banks such as Standard Chartered PLC, BNP Paribas SA and Credit Suisse Group AG have generally refused to handle transactions to Iran for fear of being fined for running afoul of U.S. sanctions. Chinese and smaller European banks have attempted to step into the breach, even though many companies remain concerned about the regulatory environment.

Some smaller European asset managers have teamed with partners in Iran to launch stock and private-equity funds pitched to foreign investors. Charlemagne Capital, for example, a U.K.-based manager that specializes in emerging and frontier markets, joined Iran’s Turquoise Capital last April to launch Iran-focused funds. American brokers and asset managers have stayed away from the market, however.

Some large multinationals—including infrastructure giants and major oil companies—are keeping a close eye on the U.S. and its new president, in case sanctions snap back into place. Shell, Total SA of France and OMV AG of Austria have signed memorandums of understanding for deals in Iran but have yet to complete terms.

Last month, Total Chief Executive Patrick Pouyanné said the company would wait for clarity from the Trump administration before completing a $4.8 billion investment in the country’s South Pars offshore gas field.

But many foreign companies are finding the country’s growth hard to ignore.

The International Monetary Fund recently estimated the economy grew 7.4% in the first half of the Iranian fiscal year that ended this month, rebounding from a decline in the previous year. Meanwhile, a surge in demand has pushed consumer spending in Tehran to $5,240 per capita in 2017, up about 11% compared with 2016, according to the London-based Planet Retail, a research firm.

The upshot is even if there is demand to buy American, much of Iran’s market is left to European and Asian companies.

“The market is now more diverse with Chinese cars and we realize how important it is to have satisfied customers,” says Mohsen Karimi, a sales manager at Iran Khodro, a domestic auto manufacturer that has a partnership with Peugeot. Khodro had sold out its stock of cars this past year, and was now behind delivery targets for advance sales, Mr. Karimi added.

Like many Tehran residents, Alireza Aniseh wanted his first car to stand out in a streetscape filled with boxy Iranian models. The 24-year-old says he is leaning toward buying a Toyota Corolla or Camry, but his dream is owning a Ford Focus.

“Who doesn’t love American cars?” he says.

Write to Asa Fitch at asa.fitch@wsj.com and Benoit Faucon at benoit.faucon@wsj.com

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Beijing Defends Its Right to Guard South China Sea With Arms

March 24, 2017

Chinese Premier Li Keqiang says deployment of military gear helps to protect maritime trade routes

Malcolm Turnbull in China

Chinese Premier Li Keqiang arrives in Australia for a five-day visit, March 23, 2017. Reuters photo

March 24, 2017 1:44 a.m. ET

CANBERRA, Australia—Chinese Premier Li Keqiang made an unusually elaborate defense of Beijing’s deployment of military gear on artificial islands in the South China Sea, saying the disputed facilities were partly intended to protect maritime trade and air routes.

Mr. Li, who was asked to speak about the hot-button issue on a visit to Australia to promote trade links, said that it was China that would be hit hardest by conflict in a region home to trillions of dollars worth of seaborne trade.

“China’s facilities on Chinese islands and reefs are primarily for civilian purposes,” Mr. Li said in a press conference at Australia’s Parliament. “And even if there is a certain amount of defense equipment or facilities, it is for maintaining the freedom of navigation and overflight in the South China Sea, because without such freedom or without stability in the South China Sea, the Chinese side would be the first to bear the brunt of it.”

His comments were a rare amplification by a top Chinese leader on Beijing’s South China Sea policies following a pledge in 2015 by China’s President Xi Jinping not to militarize the islands . The U.S. and some Asian countries that have territorial disputes with China in the sea are concerned about the construction of extensive facilities including ports, hangars and military-capable runways.

Last year, after a U.S. think tank released satellite images appearing to show China had installed antiaircraft weapons and other arms on all seven islands it has built in the in the Spratly archipelago, China’s Defense Ministry said the emplacements were for “appropriate and legal” self-defense.

Both the U.S. and China say their main goal in the South China Sea is to maintain security, freedom of navigation in the vital global trade route. Where they disagree is over China’s expansive maritime claims over most of the sea and who should be the guarantor of such principles.

The U.S. has carried out several so-called freedom-of-navigation operations in the South China Sea, sending warships close to Chinese-built atolls in patrols that have raised tensions between Washington and Beijing.

Mr. Li said China “never had any intention” to engage in militarization when it began building islands in waters claimed in whole or part by China, the Philippines, Vietnam, Malaysia, Taiwan and Brunei. But he said China’s presence guaranteed that more than 100,000 ships passed through the sea and the pirate-plagued Malacca Strait last year without being attacked.

“We hope that the market and the business communities will continue to have strong faith in the South China Sea, in these sea-lanes with safe passage to pursue more free trade,” he said.

An estimated $5 trillion worth of goods pass through South China Sea maritime trade routes each year, en route to China, South Korea, Japan and other Asia-Pacific destinations.

During his confirmation hearings, U.S. Secretary of State Rex Tillerson said Washington may need to block China from some South China Sea islands, what expert said could trigger a dangerous military escalation. But Mr. Tillerson struck a conciliatory tone after meeting President Xi Jinping last week, promising “non-conflict, non-confrontation, mutual respect and win-win cooperation.”

Australia’s Prime Minister Malcolm Turnbull signed deals with Mr. Li on Friday to expand Australia’s $6 billion-a-year beef export industry with China, while streamlining the 2015 China-Australia Free Trade Agreement. The beef deal sought to capitalize on a temporary halt to China’s imports of beef from Brazil after a furor there over meatpacking safety.

Mr. Li’s five-day visit to Australia is the first by a Chinese premier in more than a decade and comes weeks ahead of a visit by U.S. Vice-President Mike Pence aimed at improving alliance ties. As well as signing trade agreements, Mr. Li will also attend a weekend game of Australian Rules, the country’s quirky homegrown football code which Canberra hopes will take off in China.

Mr. Li has also sought while in the country to contrast China’s trade stability with the U.S. under Mr. Trump, warning against protectionism and Washington’s decision to reject a Pacific trade pact favored by Australia.

Mr. Turnbull said his country didn’t need to choose between security alliance ties with the U.S. and China, as the country’s biggest trade partner, worth about $114 billion last year, around a quarter of Australia’s total.

“We have a staunch, strong ally in Washington and a very good friend in Beijing,” Mr. Turnbull said. “It’s a multipolar world. The idea that Australia has to choose between Australia and the United States is not correct.

Jeremy Page in Beijing contributed to this article.

Write to Rob Taylor at rob.taylor@wsj.com

https://www.wsj.com/articles/beijing-defends-its-right-to-guard-south-china-sea-with-arms-1490334273

The U.S. Is Preparing to Charge Financier Jho Low in Malaysian 1MDB Scandal — Malaysian Prime Minister Najib Razak received more than $1 billion in his personal bank accounts

March 21, 2017

U.S. authorities intend to file criminal charges against Mr. Low, according to people familiar with the investigation, but haven’t disclosed potential timing

Malaysian financier Jho Low greeted model Gigi Hadid at the Angel Ball in New York in October 2014.
Malaysian financier Jho Low greeted model Gigi Hadid at the Angel Ball in New York in October 2014. PHOTO: DIMITRIOS KAMBOURIS/GETTY IMAGES

U.S. authorities intend to file criminal charges against a financier in connection with an international scandal rooted in Malaysia that they believe could be one of the largest financial frauds ever, according to people familiar with the matter.

The scandal involves a state fund called 1Malaysia Development Bhd., or 1MDB, and the focus of the criminal investigation is Jho Low, a flamboyant financier the U.S. Justice Department portrayed in civil asset-seizure lawsuits last July as central to an alleged plot to siphon billions of dollars from the fund.

The civil suits, which are proceeding separately from the criminal probe, seek more than $1 billion of assets, including van Gogh and Monet paintings and luxury real estate in New York and Los Angeles, allegedly bought with stolen money. The Justice Department is currently seeking to add recently discovered Low family property to the list of assets it is trying to seize, including a yacht Mr. Low controls, the $165 million, 300-foot, helipad-equipped Equanimity, people familiar with the U.S. investigation said.

In addition, Singapore has been building a potential criminal case against Mr. Low, said a person involved in the city-state’s investigation. A Justice Department team has just finished a visit to Singapore to conduct interviews related to Mr. Low and other aspects of the 1MDB matter, said two people familiar with the trip.

Mr. Low, a Malaysian whose full name is Low Taek Jho, and his lawyers didn’t respond to requests for comment. In the past, Mr. Low has told news organizations he was the victim of political infighting in Malaysia and was only an informal adviser to 1MDB. His family is taking legal action to fight the U.S. asset-seizure lawsuits.

Jho Low, a Malaysian financier suspected of playing a key role in an alleged looting of state fund 1Malaysia Development Bhd., or 1MDB, sent friends this New Year’s greeting.

“2016 was the Perfect Storm; but the calmness and resolve of our Captain, led his loyal Sailors whom placed their lives with utmost trust in his leadership weathered the storm…”

“When the wind could not blow away their joint resilience, the storm eventually passed, and the Captain simply adjusted their sails effortlessly and continued their destined journey…”

“The men and women that came out of the storm were not the same men that walk in. Through struggle, they established new strengths they never knew they collectively had…”

“The very moment they were brought to their knees, and their world was about to fall apart; their Captain’s exemplary leadership guided them to safety; and through this experience, they achieve a new level of humility, nobility and higher intelligence ready to set sail for greater achievements in 2017 for their people!”

Happy New Year 2017! 🙂

This is an illustration of Mr. Low’s WeChat message Weathering the Storm

THE WALL STREET JOURNAL.

Mr. Low, a 35-year-old known for hanging out with Hollywood celebrities and hosting lavish parties in Las Vegas and elsewhere, struck a confident tone in a New Year’s message to friends this January. “2016 was the Perfect Storm; but the calmness and resolve of our Captain, led his loyal Sailors whom placed their lives with utmost trust in his leadership weathered the storm,” Mr. Low wrote in a WeChat message viewed by The Wall Street Journal. “The men and women that came out of the storm were not the same men that walk in. Through struggle, they established new strengths they never knew they collectively had,” he wrote.

“The very moment they were brought to their knees, and their world was about to fall apart,” Mr. Low added, “their Captain’s exemplary leadership guided them to safety; and through this experience, they achieve a new level of humility, nobility and higher intelligence ready to set sail for greater achievements in 2017 for their people!”

Since the U.S. filed its asset-seizure suits, which are against the assets themselves and don’t name people as defendants, Mr. Low has largely disappeared from public view. He has deleted some email accounts, changed phones regularly and avoided the U.S., said people familiar with his movements.

With his bank accounts frozen by several countries—and Mr. Low warned by officials in Malaysia to stay away, according to people familiar with the matter—the financier has mainly been living in China and Thailand, said those familiar with his comings and goings. At the Peninsula Hotel in Shanghai, a staff member last year described Mr. Low as a long-term resident. Mr. Low’s yacht has been moored in Thai waters since October.

The Equanimity recently was berthed for around 40 nights at the Ao Po Grand Marina on the Thai resort island of Phuket, records show, at a cost of about $20,000, part of it settled from a baht account at Bangkok Bank. The bank and the marina manager declined to comment.

Malaysian financier Jho Low’s luxurious yacht Equanimity during the Monaco Yacht Show in September 2014.
Malaysian financier Jho Low’s luxurious yacht Equanimity during the Monaco Yacht Show in September 2014. PHOTO: SIMON DAWSON/BLOOMBERG NEWS

The 1MDB scandal unfolded when the Malaysian fund, which had run up a multibillion-dollar debt to finance development but had little to show for it, began struggling to repay. Later, billions of dollars were found to be missing. Investigations in search of the money sprang up in six countries.

The U.S.’s prosecution plans, which could change or be dropped as its investigation continues, involve filing criminal charges of wire fraud and money laundering against Mr. Low and potentially some of his associates, said people familiar with the probe. They didn’t describe the potential timing. To obtain an indictment, prosecutors would present evidence to a grand jury, which would need to agree the government had probable cause to believe a law had been broken.

Any charges could increase pressure on Malaysian Prime Minister Najib Razak, who set up 1MDB and was close to Mr. Low. Mr. Najib received more than $1 billion in his personal bank accounts—including more than $800 million originating with the state fund—via a network of offshore funds and accounts controlled by Mr. Low and his associates, according to Malaysian investigation documents viewed by the Journal and to people familiar with the U.S. investigation.

Malaysian Prime Minister Najib Razak. Photo: AFP

The U.S. asset-seizure suits refer to a “Malaysian Official 1” that the suits allege received hundreds of millions of dollars siphoned from 1MDB. “Malaysian Official 1” refers to Mr. Najib, according to a person with knowledge of the investigation.

Mr. Najib has denied any wrongdoing. Early last year, Malaysia’s attorney general said large deposits in his accounts were a donation from a member of Saudi Arabia’s royal family and most was returned. Attempts to contact Mr. Najib for this article were unsuccessful. The 1MDB fund itself has also denied wrongdoing and pledged cooperation with investigators.

Days before the U.S. filed its asset-seizure suits, Mr. Low tried to sell a Monet painting for €26.9 million, using an account at a bank on the island of Comoros off Africa’s east coast, according to the court filings. They show that compliance staff at another bank involved in the planned transaction, Moroccan Foreign Trade Bank International, rejected it following the U.S. suits. Both banks declined to comment.

Many of the assets sought are owned through trusts, court filings show. After trustees in New Zealand declined to resist the U.S. seizure suits, lawyers for the Low family persuaded courts in New Zealand and the Cayman Islands to transfer some assets to a new trustee, according to the filings. The lawyers have asked another court, in California, to let this new trustee challenge the U.S. civil suits.

Court proceedings in New Zealand revealed additional Low family assets that the Justice Department now is seeking to add to its seizure list. Besides the yacht, they include a luxury apartment in Paris and a London penthouse with views of Buckingham Palace.

Amid the growing pressure, Mr. Low has taken inspiration from “The King of Oil: The Secret Lives of Marc Rich, ” according to people who have discussed the book with him. The late Mr. Rich was a commodities trader indicted in the U.S. on tax evasion and other charges who lived without arrest for decades in Switzerland, then was pardoned by President Bill Clinton in 2001. In Mr. Low’s case, Switzerland is among countries pursuing investigations of 1MDB, and it has frozen Mr. Low’s bank accounts.

Write to Bradley Hope at bradley.hope@wsj.com and Tom Wright at tom.wright@wsj.com

Appeared in the Mar. 22, 2017, print edition as ‘U.S. Eyes Charges in 1MDB Scandal.’

https://www.wsj.com/articles/the-u-s-is-preparing-to-charge-a-leading-figure-in-malaysian-scandal-1490109286

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Tim Leissner, former Southeast Asia chairman for Goldman Sachs PHOTO: ACE PICTURES/ZUMA PRESS
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China Sees a Manufacturing Future in America — “Need to eliminate the two workers” — “Americans can’t or won’t do the work”

March 21, 2017

Beset by high taxes, slow shipping, one Dongguan shoe maker looks to the U.S.

Robot arms at a plant in Dongguan, China. Automation is leveling the playing field in global manufacturing, with some companies leaving China for the U.S.

Robot arms at a plant in Dongguan, China. Automation is leveling the playing field in global manufacturing, with some companies leaving China for the U.S. PHOTO: IMAGINECHINA

DONGGUAN, China—Glen Lin is struggling to keep his shoe company competitive on the world’s factory floor in southern China. Wages are shooting up 15% each year. Taxes are high. Shipping is exorbitant, and slow.

So, as fast as he can he’s automating production, while planning an escape to his largest market—the U.S.

The vice general manager of Dongguan Winwin Industrial, a Taiwan-owned company, is scouting for a location in America to move his newest machinery that turns out high-quality sneakers and casual shoes. Most likely, he’ll end up near one of his main customers: Skechers, based in California, Crocs in Colorado, or Nike in Portland, Ore.

In global manufacturing, fortunes are starting to shift in America’s favor.

That’s despite Donald Trump’s angry election rhetoric about China “raping” the U.S., and his threats to forcibly bring home manufacturing jobs by slapping across-the-board tariffs of 45% on Chinese imports.

The trends were clear well before Mr. Trump started rallying his blue-collar base with alarmist messages of protectionism. In fact, China’s trade challenge peaked years ago: Exports to the U.S. surged in the immediate aftermath of the country joining the World Trade Organization in 2001, throwing several million U.S. assembly workers out of a job, but they have since flattened out.

Nowadays, the exit of U.S. factory jobs from the country is roughly matched by posts coming in, according to the nonprofit Reshoring Initiative, which encourages companies to bring production back to the U.S.

Job-creating investment from China is booming in particular. Last year, it tripled to $45.6 billion from a year earlier, according to the Rhodium Group.

Chinese social-media sites were abuzz last year when the auto-glass tycoon Cao Dewang announced he was moving part of his production empire to Ohio. Some commentators denounced him for “running away.” He insisted he could make more money producing for the U.S. market from Ohio than China.

Although U.S. wages are still higher than those in China, the gap is rapidly narrowing. Andy Gu, vice president of international business for Midea, a massive home-appliance maker also based in southern China, says a competent engineer now demands up to $50,000 a year. Ordinary workers get about $600 a month, with food and lodging on top.

Moreover, industrial land in the U.S. is often cheaper than in Chinese coastal cities. The shale-gas revolution has dramatically lowered U.S. energy costs.

But the real key is technology: Advanced manufacturing is leveling the playing field.

Shoe and clothing makers were the first to flee the U.S. after China’s accession to the WTO, prompting a wave of outsourcing. Furniture and electrical-goods manufacturers soon followed. Today, some are heading back to a country in the throes of a manufacturing renaissance, one that goes largely unacknowledged by a Trump White House obsessively focused on the trade deficit.

Dongguan Winwin illustrates the long-term trajectories. Several years ago, the company moved part of its production to Indonesia, joining a mass exodus of shoemakers out of China to Southeast Asia where workers are still paid a pittance to stitch and glue cheap sneakers together. Mr. Lin stayed behind to develop a high-tech manufacturing process that squirts warm plastic onto a mesh sock to form the rubberlike soles and uppers of a sneaker in just a few minutes.

One injection-mold machine with two operators has replaced 50 assembly-line workers. He now has 60 machines.

“My goal,” says Mr. Lin “is to eliminate the two workers.”

Once that is accomplished—with robot arms—the benefits of operating in the U.S. will be even more obvious. For a start, the two-month shipping time will vanish. And, according to Mr. Lin, it will take just three months, rather than a year now, from conceptualizing a new shoe to putting it on shop shelves.

The calculations, of course, differ across industries. Given the complexities of electronics manufacturing, where dexterous fingers and sharp eyes do work that robots still can’t, it would be much harder for Apple to shift iPhone production to the U.S.

Mr. Gu says Midea has no plans to relocate. It’s impossible to beat China’s massive economies of scale in manufacturing, he says.

Besides, for many consumer products, like the iPhone, China is the indispensable market. Within a few years, China will have 300 million or so urban-middle-class consumers, equal to the entire population of the U.S.

Yet for an expanding number of companies the math behind relocating production to the U.S. is starting to add up.

They won’t be returning large numbers of assembly jobs to shattered rust-belt communities: That idea, which played so well for Mr. Trump on the campaign trail, is pure fantasy.

Instead, investors will be recruiting skilled technicians—if they can find them. A recent Deloitte study predicted that the U.S. will need to fill 3.5 million manufacturing jobs over the next decade, but faces a shortfall of two million skilled workers.

To fix that debilitating problem, Mr. Trump’s trade czars might look to China as a model. As for Mr. Lin, if he can’t find the talent he needs in America, he says he’ll bring the best in the business—from Dongguan.

Write to Andrew Browne at andrew.browne@wsj.com

Kim Jong-Un releases propaganda video where North Korea ‘blows up’ an US aircraft carrier

March 21, 2017

No automatic alt text available.

  • North Korea media published a video depicting the bombing of a US air carrier
  • The country has threatened to use ‘rockets tipped with nuclear warheads’
  • It warned it could reduce the US to ‘ashes’ if ‘even a single bullet at the country’
  • Chilling threat came before Pyongyang carried out tests on new rocket engines

Kim Jong-Un released a military propaganda video depicting North Korean troops blowing up a US aircraft carrier.

The strange clip posted on Saturday by state media shows fictional footage of North Korean troops joyously destroying American planes and bombers.

A female narrator gleefully exclaims over the war footage ‘a knife will be stabbed into the throat of the carrier, while the bomber will fall from the sky after getting hit by a hail of fire’ according to Yonhap News Agency.

North Korea ‘blows up US carrier’ in new propaganda video
The military propaganda video shows North Korean troops targeting American planes 

The military propaganda video shows North Korean troops targeting American planes

The female narrator says 'a knife will be stabbed into the throat of the carrier, while the bomber will fall from the sky after getting hit by a hail of fire'

The female narrator says ‘a knife will be stabbed into the throat of the carrier, while the bomber will fall from the sky after getting hit by a hail of fire’

Hoards of North Korean troops are seen cheering on the destruction of American air carriers in the propaganda video 

Hoards of North Korean troops are seen cheering on the destruction of American air carriers in the propaganda video

The video shows ‘Foal Eagle’ military drills with America and South Korea which have long angered the North Korean government according to Newsweek.

Uriminzokkiri, the YouTube page where the video was published, has hosted other controversial clips which depict North Korean troops bombing America.

In 2013 it published a video showing a North Korean man dreaming of missiles raining down upon Washington, D.C. and New York.

The video comes as Kim threatened to reduce the US ‘to ashes’ with nuclear weapons if American fires ‘even a single bullet’ at North Korea.

Pyongyang said it would use its ‘invincible Hwasong rockets tipped with nuclear warheads’ to defend its territory as tensions with South Korea continued to escalate.

It comes as Seoul insisted North Korea’s latest rocket-engine test showed ‘meaningful’ progress and as an an analyst said the secretive state had taken a dangerous step towards its goal of developing a rocket that could hit the United States.

Kim Jong-Un has threatened to reduce the US 'to ashes' with nuclear weapons if American fires 'even a single bullet' at North Korea. He is pictured yesterday inspecting the ground jet test of newly developed high-thrust engine at the Sohae Satellite Launching Ground in North Korea

Kim Jong-Un has threatened to reduce the US ‘to ashes’ with nuclear weapons if American fires ‘even a single bullet’ at North Korea. He is pictured yesterday inspecting the ground jet test of newly developed high-thrust engine at the Sohae Satellite Launching Ground in North Korea

Pyongyang said it would use its 'invincible Hwasong rockets tipped with nuclear warheads' to defend its territory as tensions with South Korea continued to escalate. Pictures show rocket engine tests yesterday

Pyongyang said it would use its ‘invincible Hwasong rockets tipped with nuclear warheads’ to defend its territory as tensions with South Korea continued to escalate. Pictures show rocket engine tests yesterday

The statement, from Kim Jong-Un’s Foreign Office, was released earlier this month before the latest tests.

It said: ‘The Korean People’s Army will reduce the bases of aggression and provocation to ashes with its invincible Hwasong rockets tipped with nuclear warheads and reliably defend the security of the country and its people’s happiness in case the US and the south Korean puppet forces fire even a single bullet at the territory of the DPRK.’

Last night, the North’s KCNA news agency said its new rocket engine would help the state achieve world-class satellite-launch capability, indicating a new type of rocket engine for an intercontinental ballistic missile.

The North’s announcement of a successful engine test came as U.S. Secretary of State Rex Tillerson was in Beijing at the end of his first visit to Asia for talks dominated by concern about North Korea’s nuclear and missile programmes.

‘Through this test, it is found that engine function has made meaningful progress but further analysis is needed for exact thrust and possible uses,’ Lee Jin-woo, deputy spokesman for the South Korean defence ministry, told a regular briefing.

Kim Jong-Un grins after watching new rocket engine launch
It comes as Seoul insisted North Korea's latest rocket-engine test showed 'meaningful' progress and as an an analyst said the secretive state had taken a dangerous step towards its goal of developing a rocket that could hit the United States. Kim Jong-UN is pictured, centre, with his officials yesterday

It comes as Seoul insisted North Korea’s latest rocket-engine test showed ‘meaningful’ progress and as an an analyst said the secretive state had taken a dangerous step towards its goal of developing a rocket that could hit the United States. Kim Jong-UN is pictured, centre, with his officials yesterday

State-run North Korean media reported that leader Kim Jong Un had hailed the successful test of a new high-thrust engine at its rocket launch station (pictured) as 'a new birth' of its rocket industry

State-run North Korean media reported that leader Kim Jong Un had hailed the successful test of a new high-thrust engine at its rocket launch station (pictured) as ‘a new birth’ of its rocket industry

State-run North Korean media reported that leader Kim Jong Un had hailed the successful test of a new high-thrust engine at its rocket launch station as ‘a new birth’ of its rocket industry.

Lee said the test featured a main engine supported by four supplementary engines.

However, he did not elaborate on the progress the test showed the North had made, nor comment on whether the engine could be used for an intercontinental ballistic missile (ICBM), saying the South Korean military was conducting analysis.

U.S. President Donald Trump told reporters he held meetings on North Korea at the weekend at his Florida resort. While he did not refer specifically to the rocket-engine test, he said Kim Jong Un was ‘acting very, very badly’.

A South Korean analyst said the test was an ominous development.

‘This was a comprehensive test for the first-stage rocket for an ICBM, and that is why it was dangerous,’ said Kim Dong-yub, an analyst at Seoul’s Institute for Far Eastern Studies.

‘It appears that North Korea has worked out much of its development of the first-stage rocket booster.’

North Korea has conducted five nuclear tests and a series of missile launches in defiance of U.N. sanctions, and is believed by experts and government officials to be working to develop nuclear-warhead missiles that could reach the United States.

North Korean leader Kim said in January his country was close to test-launching an ICBM. That would put parts of the United States in range.

Last week, Tillerson issued the Trump administration’s starkest warning yet to North Korea, saying in Seoul that a military response would be ‘on the table’ if it took action to threaten South Korean and U.S. forces.

North Korean leader Kim said in January his country was close to test-launching an intercontinental ballistic missile. That would put parts of the United States in range

North Korean leader Kim said in January his country was close to test-launching an intercontinental ballistic missile. That would put parts of the United States in range

The United States has long called on China to do more to rein in its ally, North Korea. China resents being pressed to do more, saying the problem is between North Korea and the United States, although it too objects to the North’s nuclear programme.

No formal agreements were announced during Tillerson’s visit to China although the two sides said they would work together to try to make North Korea take ‘a different course’.

China has called for a dual-track approach on North Korea, urging it to suspend its tests and the United States and South Korea to suspend military exercises so both sides can return to talks.

Beijing has also been infuriated by the deployment of an advanced U.S. anti-missile system in South Korea, which it says will both harm China’s own security and do nothing to ease tensions.

China says the system’s powerful radar will extend into the country’s northeast and potentially track Chinese missile launches, and maybe even intercept them. Russia also opposes the system, for the same reasons.

Read more: http://www.dailymail.co.uk/news/article-4333616/Kim-Jong-releases-anti-American-propaganda-video.html#ixzz4bwuQBOGS
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NORTH Korea has pledged to launch a nuclear strike on the US if a “single bullet is fired” as US forces flood the Korean Peninsula.

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USS Carl Vinson refuels USS O’Kane

North Korea Uses a Page From Iran’s Propaganda Plan: Blow up US aircraft carrier and shoot down bomber in propaganda video

March 21, 2017

North Korea Uses a Page From Iran’s Propaganda Plan: Blow up US aircraft carrier and shoot down bomber in propaganda video

Snaps from the secretive state’s recent ballistic missile launches are shown alongside a haunting message

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KIM Jong-un has released a propaganda video showing a US aircraft carrier being blown up and a bomber shot down in flames.

Snaps from the secretive state’s recent ballistic missile launches are shown alongside the haunting message: “A knife will be stabbed into the throat of the carrier.”

It comes after the leader threatened to reduce the US “to ashes” as tensions with North Korea continue to increase.

The shocking video goes on to declare: “The bomber will fall from the sky after getting hit by a hail of fire.”

Footage also shows the USS Carl Vinson nuclear-powered aircraft carrier up in flames.

Includes video:

https://www.thesun.co.uk/news/3137810/north-korea-propaganda-us/

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File picture of a North Korean Musudan missile

Intermediate-range Musudan missile launch in North Korea. EPA photo

NORTH Korea has pledged to launch a nuclear strike on the US if a “single bullet is fired” as US forces flood the Korean Peninsula.

Image may contain: ocean, sky, outdoor and water

USS Carl Vinson refuels USS O’Kane

Kim Jong-Un beams as he watches a ‘revolutionary’ new rocket being tested despite a ban on North Korea developing missiles

March 19, 2017

  • North Korea conducted a ground test of a new type of high-thrust rocket engine
  • Kim was beaming from ear to ear as he and his generals applauded the test
  • He called it ‘an event of historic significance’ for the country’s rocket industry

North Korea has conducted a ground test of a new type of high-thrust rocket engine that leader Kim Jong Un is calling a revolutionary breakthrough for the country’s space program.

Kim was beaming from ear to ear as he and his generals applauded the successful test at the Sohae launch site yesterday.

The trial was intended to confirm the engine’s thrust power and gauge the reliability of its control system and structural safety.

Kim hailed it ‘a great event of historic significance’ for the country’s rocket industry.

Scroll down for video 

Beaming: Kim celebrated with his generals who applauded the test at the launch site

Beaming: Kim celebrated with his generals who applauded the test at the launch site

Having a blast: North Korean leader Kim Jong Un at the country's Sohae launch site yesterday

Having a blast: North Korean leader Kim Jong Un at the country’s Sohae launch site yesterday

Kim called the test 'a great event of historic significance' for the country's indigenous rocket industry

Kim called the test ‘a great event of historic significance’ for the country’s indigenous rocket industry

Kim watched the rocket being fire from afar as he celebrated what he called a great day in his country's history

Kim watched the rocket being fire from afar as he celebrated what he called a great day in his country’s history

He also said the ‘whole world will soon witness what eventful significance the great victory won today carries’ and claimed the test marks what will be known as the ‘March 18 revolution’ in the development of the country’s rocket industry.

The engine is to be used for North Korea’s space and satellite-launching program.

North Korea is banned by the United Nations from conducting long-range missile tests, but it claims its satellite program is for peaceful use, a claim many in the U.S. and elsewhere believe is questionable.

North Korean officials have said that under a five-year plan, they intend to launch more Earth observation satellites and what would be the country’s first geostationary communications satellite – which would be a major technological advance.

Getting that kind of satellite into place would likely require a more powerful engine than its previous ones. The North also claims it is trying to build a viable space program that would include a moon launch within the next 10 years.

The test was conducted as US Secretary of State Rex Tillerson was in China on a swing through Asia that has been closely focused on concerns over how to deal with Pyongyang’s nuclear and missile programs.

He also said the 'whole world will soon witness what eventful significance the great victory won today carries'

He also said the ‘whole world will soon witness what eventful significance the great victory won today carries’

North Korea has conducted a ground test of a new type of high-thrust rocket engine

North Korea has conducted a ground test of a new type of high-thrust rocket engine

It’s hard to know whether this test was deliberately timed to coincide with Tillerson’s visit, but Pyongyang has been highly critical of ongoing U.S.-South Korea wargames just south of the Demilitarized Zone and often conducts some sort of high-profile operation of its own in protest.

Earlier this month, it fired off four ballistic missiles into the Sea of Japan, reportedly reaching within 120 miles of Japan’s shoreline.

Japan, which was Tillerson’s first stop before traveling to South Korea and China, hosts tens of thousands of U.S. troops.

The test was conducted as US Secretary of State Rex Tillerson was in China on a swing through Asia

The test was conducted as US Secretary of State Rex Tillerson was in China on a swing through Asia

Chinese President Xi Jinping meets US Secretary of State Rex Tillerson at the Great Hall of the People in Beijing, China

Chinese President Xi Jinping meets US Secretary of State Rex Tillerson at the Great Hall of the People in Beijing, China

While building ever better long-range missiles and smaller nuclear warheads to pair with them, North Korea has marked a number of successes in its space program.

It launched its latest satellite – the Kwangmyongsong 4, or Brilliant Star 4 – into orbit on Feb. 7 last year, just one month after conducting what it claims was its first hydrogen-bomb test.

It put its first satellite in orbit in 2012, a feat few other countries have achieved. In 2013, rival South Korea launched a satellite into space from its own soil for the first time, though it needed Russian help to build the rocket’s first stage.

North Korea put its first satellite in orbit in 2012, a feat few other countries have achieved

North Korea put its first satellite in orbit in 2012, a feat few other countries have achieved

Read more: http://www.dailymail.co.uk/news/article-4328086/North-Korea-tests-newly-developed-high-thrust-rocket-engine.html#ixzz4bmpfOgSf
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Treasury’s Mnuchin Fends Off Push to Reject Protectionism

March 18, 2017

G-20 finance chiefs fail to reach agreement on language rejecting protectionism, signaling rift on trade

U.S. Treasury Secretary Steven Mnuchin signing a visitors book at the G-20 finance ministers meeting in Baden-Baden, Germany, on March 17.

U.S. Treasury Secretary Steven Mnuchin signing a visitors book at the G-20 finance ministers meeting in Baden-Baden, Germany, on March 17. PHOTO: RONALD WITTEK / POOL/EUROPEAN PRESSPHOTO AGENCY
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Updated March 18, 2017 3:44 p.m. ET

BADEN-BADEN, Germany—U.S. Treasury Secretary Steven Mnuchin rebuffed a concerted push by world finance chiefs Saturday to disavow protectionism, fanning fears that the Trump administration’s pursuit of an “America First” policy could ignite global trade conflicts.

Instead of hammering out a compromise that allayed those fears, finance ministers and central bankers from the Group of 20 largest economies ended two days of negotiations in stalemate. Their keenly anticipated joint statement papered over differences on trade…

Instead of hammering out a compromise that allayed those fears, finance ministers and central bankers from the Group of 20 largest economies ended two days of negotiations in stalemate. Their keenly anticipated joint statement papered over differences on trade and largely reiterated a series of longstanding promises to boost growth, avoid currency devaluations and ward off threats to the global economy.

It was not the best communique that was ever produced by the G-20, certainly, the European Union’s economics commissioner, Pierre Moscovici, said in an interview.

German Finance Minister Wolfgang Schäuble, who hosted the gathering in this tony German spa town, said Mr. Mnuchin appeared to have no mandate to negotiate any new or creative commitments on trade.

“Sometimes you have to limit yourself at such meeting to not asking too much of one partner, you can’t ask too much of him anyway because he would then simply not agree to it,” Mr. Schäuble said at a news conference.

In failing to secure a written agreement from the U.S. that would repeat past G-20 vows to reject protectionism in all its forms, many officials said they were departing confused about where the new administration will ultimately land on trade policy.

The Treasury secretary advanced his boss’s view, promoting “free and fair trade.”

“The United States has been treated very, very unfairly by many countries over the years,” Mr. Trump said in Washington on Friday, ahead of a meeting with German ChancellorAngela Merkel, who chairs the G-20 this year. “That’s going to stop.”

Despite the pressure Mr. Mnuchin faced from most of the G-20 membership, Washington showed it still holds significant sway as the world’s consumer of last resort: The G-20 adopted a pledge to promote “fairness” as it pursued economic growth.

Mr. Moscovici, a former French finance minister, described Mr. Mnuchin as “a man who wants constructive engagement,” who came to Europe “in listening mode.” He said the meeting wasn’t confrontational, and that it was a time “to try to identify with the new administration.”

Still, he regretted the absence of a clearer mention of fighting protectionism or climate change, and pledged that the EU would push back against measures that undermined open and functioning markets.

At the meeting, Brazil Finance Minister Henrique Meirelles told the G-20 about his country’s own experience with protectionism as the country has just experienced its worst recession on record.

“We had adopted during the last years some protectionist measures for some sectors of the economy and the net result was not positive,” Mr. Meirelles said in an interview.

“At the end of the day the products became more expensive and Brazil…became less competitive, In Brazil, we are moving towards a more open trade policy.”

G-20 officials said they see both a new U.S. administration struggling to get up and running and competing power centers with different views on trade.

“Nobody knows what the endgame is,” a senior G-20 official said. “Either the meeting is several months too early or it’s perfect timing,” the official said, giving the G-20 an opportunity to help temper U.S. policy before it is cemented.

Investors are still confused, for example, about the administration’s dollar policy, having been given different signals from Mr. Trump and his lieutenants.

Asked who markets should heed, Mr. Mnuchin said: “They should listen to the president first and listen to me as well.”

Germany's Finance Minister Wolfgang Schaeuble smiles during a statement on the occasion of the G-20 Finance Ministers meeting in Baden-Baden, Germany, on Friday.

Germany’s Finance Minister Wolfgang Schaeuble smiles during a statement on the occasion of the G-20 Finance Ministers meeting in Baden-Baden, Germany, on Friday. PHOTO: UWE ANSPACH/ASSOCIATED PRESS
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Evidence that it may just be too soon for the U.S. to offer the G-20 anything substantive on trade, financial regulation, tax overhauls and other policies, Mr. Mnuchin relied on senior civil servants to conduct much of the detailed negotiations at the meeting. The secretary’s international diplomats have only recently been nominated and still must go through a lengthy confirmation process.

If trade czar Peter Navarro and Steve Bannon, a top Trump adviser and self-described economic nationalist, have their way, many officials fear the White House could trigger a trade war. The administration has advocated applying unilateral actions that eschew a rules-based multilateral order, including submission to the World Trade Organization’s authority.

Others in the administration, including Mr. Mnuchin and Gary Cohn, director of the National Economic Council, hold a more internationalist view of the world. If they prevail in guiding administration policy, many G-20 officials see fiery campaign rhetoric being tamed in the coming months.

Mr. Schäuble said all G-20 delegations had agreed on opposing protectionism, but that it wasn’t always clear what they meant by this.

U.S. Treasury Secretary Steven Mnuchin, right, and U.S. Federal Reserve Chairwoman Janet Yellen speak during the group picture taken during the G-20 meeting on Friday.

U.S. Treasury Secretary Steven Mnuchin, right, and U.S. Federal Reserve Chairwoman Janet Yellen speak during the group picture taken during the G-20 meeting on Friday. PHOTO: UWE ANSPACH/ASSOCIATED PRESS
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Some countries are worried that failure to temper aggressive trade policy could not only trigger a round of retaliatory tariffs and a rise in other trade barriers that would damage global growth, it could exacerbate geopolitical tensions.

The U.S. delegation found a rare ally in Japan, which came to the defense of Mr. Mnuchin, saying talks over American protectionism were overblown.

“I feel that many of those talks are exaggerated and made-up,” Finance Minister Taro Aso said at a news conference of general concerns over Mr. Trump’s perceived protectionist instincts. Mr. Aso noted that a summit meeting held earlier this year between Mr. Trump and Japan’s Prime Minister Shinzo Abe involved “no discussions whatsoever that smacked of protectionism.”

Mr. Aso also played down the removal of a passage denouncing protectionism from the G-20 communique, saying: “No one made any opposing comment to free trade as far as I can recall” during the gathering.

Write to Ian Talley at ian.talley@wsj.com, Tom Fairless at tom.fairless@wsj.com and Andrea Thomas at andrea.thomas@wsj.com

 

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