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Benettons go from preachers to pariahs after bridge disaster

FOR HALF a century, Italy’s Benetton family has preached compassion through eye-popping ads for its eponymous clothing line that have included photos of a dying AIDS patient, a black woman breast-feeding a white baby, and most recently, African immigrants being rescued at sea.
But now the Benettons themselves are the focus of public outrage over the deadly collapse on Tuesday of Genoa’s Morandi Bridge, threatening part of the family’s other, much more profitable business running airports, turnpikes, and roadside diners from Santiago to Rome.
Leading members of Italy’s new populist coalition government have begun the process of revoking the lucrative toll license held by Atlantia SpA, the family-controlled company that operated the bridge, and want its chief dismissed. The threats triggered a sell-off that, at its depth, wiped 6 billion euros ($6.8 billion) off Atlantia’s market value and fueled a backlash on social media, where scores of posts accuse the Benettons of pursuing profit over safety.
The Benettons didn’t comment until Thursday, when they issued a statement via holding company Edizione Srl. expressing “deep sympathy” for the victims of the disaster and vowing to work with authorities to determine the cause, while emphasizing that Atlantia and its Autostrade subsidiary have invested more than 10 billion euros in Italy’s roads over the past decade.
FUNDING PLAN
Atlantia Chief Executive Officer Giovanni Castellucci followed up Saturday with a pledge to rebuild the bridge within eight months and provide an initial 500 million euros to alleviate the suffering of victims, not including possible direct compensation payments. That’s about half of what the company returned to the Benettons and other shareholders last year.
For Enrico Valdani, a professor of marketing at Bocconi University in Milan, the actions may not be enough to ease tensions with the government or win back the trust of the populace, much like United Colors of Benetton initially balked at taking responsibility for a cave-in at a Bangladeshi garment factory, where it sourced shirts, that killed more than 1,100 in 2013.
“They made a mistake by not promptly clarifying their alleged role in the fatal bridge collapse,” Mr. Valdani said by phone. “What the family now urgently needs is a straight plan of communication and crisis management. They need to demonstrate the company acted in good faith or admit any possible fault.”
A statement from the Benettons on Saturday, a day of mourning, said their thoughts were with the loved ones of the deceased. At the same time, Chairman Fabio Cerchiai said he personally hoped Mr. Castellucci, 59, will remain in the job, adding that the CEO has the support of the board and investors.
Representatives met with executives and lawyers on Friday to prepare the initial funding package, and there’ll be meetings in Rome this week to discuss the causes of the tragedy, according to people familiar with the situation.
GLOBAL FORCE
Long-celebrated in their native Treviso, a northeastern city of 85,000, for their rags-to-riches story, the Benettons last month suffered the loss of the youngest of four siblings who founded the apparel company in 1965, Carlo, who died of cancer at 74. He’s survived by Luciano, 83, Giuliana, 81, and Gilberto, 77, all of whom remain active stewards of the family’s various investments.
Luciano founded the company by selling sweaters out of small store in Treviso that were knitted by his sister Giuliana. Within two decades the offspring of a bicycle shop owner had become a global force in fashion, both for their vibrant clothing and provocative ads that occasionally riled the Catholic Church. The Vatican once took legal action to halt a campaign that featured a doctored photo of the pope kissing a Muslim leader.
Gilberto, who runs the clan’s finances, started to diversify in the 1990s, making purchases in a wave of privatizations that produced the bulk of its current fortune. The family now holds about 12 billion euros of assets, including a 30 percent stake in Atlantia, which became the world biggest toll-road operator this year with the acquisition of Spanish rival Abertis.
The strategy proved prudent. Their clothing chain has struggled to compete with upstarts like Inditex SA’s Zara brand and lost 180 million euros last year. In 2015, the family sold its stake in another major retailer, World Duty Free SpA, to Basel, Switzerland-based Dufry AG.
Last year, the siblings hired former Telecom Italia SpA Chief Executive Officer Marco Patuano to revamp their investments, reduce their dependence on Italy’s sluggish economy and pursue a more global strategy.
EUROTUNNEL STAKE
About 45 percent of the group’s revenue came from abroad last year and that share is even greater now with Atlantia’s purchase of Abertis, which operates in South America and France as well as Spain. The Benettons also became the biggest owner of Spanish mobile-phone tower operator Cellnex.
Separately, Atlantia bought a billion-euro stake in Eurotunnel — now Getlink SE — the operator of the underwater link between the U.K. and France, and won the right to manage Nice’s main airport. The company is also considering spinning off Autogrill’s North American division, which accounted for more than half of the international restaurant chain’s 4.6 billion euros of sales last year.
The Benettons have done well pivoting away from their flagging brand and will likely weather the current storm over the Morandi Bridge disaster, according to Ugo Arrigo, a professor of public finance at Bicocca University. He said he doubts the government will make good on threats by some officials to pull the toll-road license held by Atlantia, which operates half of Italy’s motorways.
“The government has been very generous in granting the family lucrative motorway tariffs over the past two decades,” Mr. Arrigo said from Milan.
Indeed, Atlantia gained back some of its stock losses Friday after La Repubblica reported that the company is in informal talks with the government over potential fines and other measures that would stop short of seizing the license held by its Autostrade unit.
The tragedy could accelerate the family’s plan to have more financial investments and fewer industrial businesses to manage. Gilberto Benetton has indicated that in the future the holding company should operate more in the manner of a sovereign wealth fund. — Bloomberg

Palay output data underscore agriculture’s bumpy situation

Palay output data underscore agriculture’s bumpy situation

How PSEi member stocks performed — August 20, 2018

Here’s a quick glance at how PSEi stocks fared on Monday, August 20, 2018.

 
Philippine Stock Exchange’s most active stocks by value turnover — August 20, 2018

Boracay may reopen with as little as 30% of firms compliant

THE government hopes up to 50% of businesses will be operational by the time the resort island of Boracay reopens as scheduled on Oct. 26, but may have to settle for 30%.
Department of Interior and Local Government Undersecretary for Operations Epimaco V. Densing said on Monday that 50% represents the high end of the target.
“The target is between 30% to 50% based on the DENR’s (Department of Environment and Natural Resources) study on the island’s carrying capacity study. Around 30 to 50% (establishments) may be opened,” he said at a Senate hearing on the Boracay environmental cleanup.
Four months into the island’s closure, Mr. Densing said some establishments remain noncompliant in terms of obtaining permits from local and national governments as well as the directive to connect to the sewer lines of water concessionaires or to install their own sewage treatment plants (STPs).
According to DILG’s count, there were about 2,384 establishments on Boracay at the time of closure in April. Mr. Densing said only 71 out of 440 hotels, inns, and restaurants have complete business requirements as of Monday. Meanwhile, only 21 out of 162 establishments have sewage treatment plants based on DENR data presented during the hearing.
In an interview with reporters, Mr. Densing clarified that the government prefers 100% compliance but may have to settle for as little as 30% to ensure the improvement in water quality is sustained.
“If you are not connected with the sewer line, if you don’t have an STP, you are not allowed to operate. If you don’t have a mayor’s permit or a building permit, you are not allowed to operate,” he said.
“If 30% (of establishments) are connected to the sewer line or only 30% have STPs, then we’ll have to open it at 30%… It is not in the interest of everybody to keep Boracay closed. But if you are not following the law to make sure that the water quality that comes out of the island is (class) SB level, then we’ll have to do with the 30%,” he added.
Wastewater management issues remained the most contentious in the rehabilitation efforts with water concessionaires saying that several establishments continue to refuse to connect with their sewer lines.
Officials from the Boracay Foundation, Inc., the largest business group on the island, said its members are put off by high wastewater treatment fees.
Senator Cynthia A. Villar, chair of the Senate committee on environment and natural resources, urged the government to provide discounts or incentives that would help establishments comply with DENR standards.
She also disagreed with the 30% target for the reopening, saying she prefers 50%.
“I don’t think it’s is a very good target, it’s too low… Maybe it’s a good target that 50% will open on Oct. 26,” she told reporters after the hearing. — Camille A. Aguinaldo

PCC warns of review if 3rd-player criteria stand

THE Philippine Competition Commission will ask the Department of Information and Communications Technology (DICT) to incorporate the commission’s recommendations in the selection criteria for the telecom industry’s third entrant, the so-called third player.
Arsenio M. Balisacan, who chairs the PCC, said the recommendations may save the third player from undergoing the PCC’s 90-day review.
“If the PCC’s recommendations are adequately accommodated in the Terms of Reference (ToR), then we may not even need to review post-award,” Mr. Balisacan told reporters last week.
“If these are implemented, then they could no longer have to be subjected to an extensive review that we are carrying out in other mergers and acquisition cases. Otherwise, telco deals are complicated, we might need to conduct a Phase 2 review,” he added.
The PCC’s recommendations include, among others, ensuring the third player has no existing relationships with the incumbents.
In an Aug. 18 draft proposal presented by the PCC, as posted by the DICT on its website, the Commission noted the need to make explicit the definition of a “Related Party”; a prohibition on mergers, combinations or becoming a related party to an incumbent telco; the return of frequencies should it become a related party; the monitoring and evaluation of compliance with the terms; and the clawback of spectrum in case of non-use.
The PCC also sought automatic notification from the third player in the event that it merges or enters a joint venture with an incumbent, or otherwise acquires, directly or indirectly, or in stages, at least 20% of the shares of stock of a related party to any incumbent.
In addition, the PCC wants to make the return of frequencies to the government, should it be ordered, to be “mandatory” instead of the ToR’s “voluntary” process.
Also, should the third player fail to use any radio frequency spectrum awarded to it as stipulated in its roll-out plan, the frequency automatically reverts to the government.
“The PCC has recommended the foregoing inputs to address the competition concerns in the terms of reference for the selection of the (third player). With these, notification and review of the transaction could be dispensed with, in accordance with PCC’s power to exempt entities from review under Sec. 19(c) of the PCA [Philippine Competition Act of 2015],” it said in the draft, referring to its notification thresholds.
“However, in the absence of the foregoing inputs in the terms of reference, PCC would be constrained to pursue a regular review of the transaction, in accordance with its mandate under Sec. 17 of the PCA,” it added.
Under Section 17 of the said law, parties to the merger or acquisition agreement are mandated to notify the PCC of the said deal if value of the transaction exceeds P2 billion. — Janina C. Lim

Rooftop solar could help reduce diesel, coal imports — report

ROOFTOP solar systems have the potential to lower electricity costs to P2.50 per kilowatt-hour (kWh) by displacing imported energy sources and bringing new investment of around P1.5 trillion by 2030, a research firm said.
Institute for Energy Economics and Financial Analytics (IEEFA) in a report on Monday said a “modernized” policy could drive the uptake of solar through programs that will ensure power supply at lower prices.
“The government is in a position to change the longstanding status quo, which disproportionately puts fuel-price and foreign-exchange risk on consumers, while utilities and power generators remain insulated from market changes,” said Sara Jane Ahmed, IEEFA energy finance analyst and author of the report.
“As a result, power suppliers have no incentive to transition away from coal and diesel or to hedge against price-change and currency risks,” she added.
The report, “Unlocking Rooftop Solar in the Philippines,” notes the country has one of the most expensive electricity rates in Southeast Asia, but it can start following global trends toward power sector modernization.
It said a modernized policy has been gaining momentum amid declining costs and technological advances in renewable energy, energy efficiency and distributed storage.
Ms. Ahmed said every kilowatt of installed rooftop solar means a reduction in the need for imported coal and diesel. The shift is estimated to save the Philippines up to $2.2 billion annually as well as $200 million per year in diesel subsidies.
The report said the Board of Investments had approved eight solar projects through Solar Philippines Commercial Rooftop Projects Inc. worth P85.96 billion, or $1.65 billion.
A conservative estimate of 8 gigawatts (GW) of solar installation by 2030 includes 35% of that coming from rooftop solar, translating into an investment value of $ 2.8 billion, it added. It said the billion-dollar market can easily grow with the right policies.
“These trends present an enormous opportunity to replace imported-coal and imported-diesel models with indigenous alternatives,” Ms. Ahmed said. “Solar, wind, run-of-river hydro, geothermal, biogas, and storage are competitive, viable domestic options that can be combined to create a cheaper, more diverse and secure energy system.”
The report cited as examples of renewable energy deflation the offer received by Manila Electric Co. (Meralco) in March of the country’s record lowest wind electricity generation bid on a new 150-megawatt (MW) wind turbine project in the Rizal province, for P3.50 per kilowatt-hour (kWh). It also pointed to an offer to Meralco for solar power at P2.99-per kWh for a 50-MW capacity plant.
These offers compare with coal-fired power generation at costs ranging from P3.8 to P5.5 per kWh. The true cost of imported diesel-fired power ranges from P15 to P28 per kWh.
The report said rooftop solar costs P2.50 per kWh, without financing expenses, to P5.3 per kWh, with financing expenses. Utility-scale solar power can cost as little as P2.99 per kWh, with wind power costing P3.5 per kWh, geothermal P3.5 to P4.5 per kWh, and run-of-river hydro P3 to 6.2 per kWh.
“Development of all of these more affordable options is still hampered by costly and unnecessary red tape. The Philippine government can help break this logjam by adopting policies that inject more diversity — and more energy security — into the electricity system while helping lower consumer costs by enabling the uptake of cheaper, cleaner options such as rooftop solar,” Ms. Ahmed said.
“More importantly, fossil fuel subsidies and electricity-sector losses are a growing drag on economic growth in the Philippines. Current plans for fossil fuel generation would instill a long-term dependence on fossil fuel imports, which would lead to more national debt, devaluation of the currency and an increase in inflation, all of which would destabilize the Philippine economy,” she added. — Victor V. Saulon

FEMSA exit triggers scramble to liberalize sugar imports, DTI says

THE GOVERNMENT is rushing to liberalize the importation of sugar to address supply issues after a major Mexican bottler gave up its rights to make and sell Coca-Cola products in the Philippines.
“It has been a concern in terms of access to and cost of sugar. So we shall review the system of sugar importation to make it more accessible at competitive cost with ample protection to sugar producers,” Trade Secretary Ramon M. Lopez said in a mobile phone message yesterday when asked for his comment on Coca-Cola FEMSA Philippines, Inc.’s sale of its Philippine franchise back to the Coca-Cola Co..
Mr. Lopez noted that the measures being contemplated do not include lowering tariffs for sugar imports.
He said the desired outcome will still have “appropriate tariff protection for local producers.” It will however involve “opening up to more importers, and industrial users and not a select few. And no other fees. So tariff revenues go to the government, which can support sugar farmers in their modernization programs,” he added.
Mr. Lopez has said that the DTI is drafting a plan that will facilitate direct sugar imports by removing middlemen and effectively reducing the retail price of sugar.
Socioeconomic Planning Secretary Ernesto M. Pernia said in a separate mobile phone message yesterday that “sugar imports should be liberalized.”
“Imports will increase supply, supplementing domestic production. Intermediation cost should be minimized if not eliminated,” he said.
In a statement on Friday, Coca-Cola FEMSA Philippines Inc.’s Mexican parent, Coca-Cola FEMSA S.A.B. de C.V. approved the sale of its 51% stake in the Philippine unit to the Coca-Cola Co.
Asked for comment, Sugar Regulatory Administration (SRA) Administrator Hermenegildo R. Serafica said that FEMSA’s Philippine unit did not obtain sufficient sugar before the new sugar-sweetened beverage excise tax under the Tax Reform for Acceleration and Inclusion (TRAIN) law was imposed in January.
“My personal opinion is that Coca-cola was scrambling for sugar supply since they weren’t buying as much sugar in the past. So when TRAIN kicked in, most domestic sugar traders had committed their volume to their other long-standing and previously contracted buyers,” he said.
“These traders would only be able to accommodate Coca-Cola if they had sugar in excess of the demand of their long-standing buyers but unfortunately for Coca-Cola, production was lower this year so there was no excess supply to fill Coca-Cola’s demand,” he added.
Presented as a health measure, the TRAIN law imposed a P12 per liter tax on drinks with high fructose corn syrup sweeteners, and a P6 levy on caloric sweeteners such as sugar.
Coca-Cola FEMSA Philippines has reduced the distribution of its products to store and has laid off some workers.
Mr. Serafica said he “welcomes” the entry of the Coca-Cola Co. unit taking over the FEMSA investment, which is known as the Bottling Investments Group (BIG), “especially since it expressed its intention to work with the Philippine sugarcane industry in increasing productivity and ensuring a stable supply of sugar for Coke.”
Mr. Serafica said sugar output in the latest crop season fell 16.9% year-on-year.
SRA data as of Aug. 14 indicate that the average retail price for sugar rose to P55.83 per kilo from P47.56 in September 2017, the start of the crop year. The average retail price of washed and refined sugar rose to P58.94 and P66.25 per kilo, respectively, from P50.27 and P54.92 in September.
The SRA addressed the supply issues by reallocating to the domestic market sugar intended for export, and asked the Bureau of Customs to auction off smuggled sugar imports. — Elijah Joseph C. Tubayan

DA, NFA to refine timing of rice imports

THE Department of Agriculture (DA) and National Food Authority (NFA) will fine-tune the scheduling of rice imports after delays in the replenishment of a strategic reserve designed to keep low-cost rice available to poor families.
Agriculture Secretary Emmanuel F. Piñol said that the proposed system will ensure that imported rice will be brought in during lean months of between June and August.
“(Imported rice) should arrive in the lean months because that is the period when we need supply in order to keep prices stable,” he added.
“We will be come up with specific schedules on the arrival of imported rice — when it should be awarded, when it should be imported, [and] when should it arrive,” Mr. Piñol said.
“We are also preparing for the reported El Niño by the end of the year,” he added.
The DA noted that some farmers are currently harvesting early. — Anna Gabriela A. Mogato

Meat under-importation sanctions to go into force by December — DA

THE Department of Agriculture said it will not for now cancel import permits held by poultry and pork industry stakeholders with Minimum Access Volume (MAV) allocations.
Agriculture Secretary Emmanuel F. Piñol said the MAV Secretariat informed the DA that it can only decide by Dec. 15 to cut the MAV allocation or bar such imports starting next year.
“The reason we gave this allocation is that we want to stabilize the supply in the market,” he added.
“With the ‘-ber’ months are approaching, this is the time of the year when there is high demand for chicken [and] pork. What we want to happen now is that prices should stabilize.”
Under World Trade Organization rules, the MAV allows a certain volume of imports of an agricultural commodity at a lower tariff rate.
The DA has said that 41% of MAV allocations for pork were left unused while 43.11% was unused for poultry. Mr. Piñol said that importers could be waiting for the holidays to import to take advantage of higher prices.
In a phone interview, National Meat Inspection Service Meat Import/Export Division chief Jocelyn A. Salvador said that poultry and hog importers should have brought in at least 70% of their MAV allocation to avoid being penalized.
Ms. Salvador added that those who did not import the minimum level will have 50% of their allocation reduced on first offense and 75% on second offense. A third offense will mean cancellation of import permits.
The DA could also cancel import permits of garlic and onion traders who did not fully utilize their allocations.
Mr. Piñol is set to met with garlic and onion traders on Thursday to discuss the utilization of the traders’ MAV allocations after the DA noted increasing prices for both commodities.
“What will happen is I’ll tell the onion traders that if they do not lower the price, I will cancel their import permits and I will have PITC (Philippine Importation Trading Corp.) import instead,” Mr. Piñol said. — Anna Gabriela A. Mogato

Meat processors lobby for streamlining of import red tape, including reduced permits

THE meat processing industry is proposing measures to help streamline the importation process for its raw materials, including the removal of certain permits.
“The industry requested NMIS [National Meat Inspection Service] to assess whether the COMI [Certificate of Meat Inspection] should continue to be mandatory considering that the manufacturers have their own Supplier Accreditation Program to check whether the meat being delivered to them is safe and handled properly,” the Department of Trade and Industry (DTI) said in a statement following a dialogue with stakeholders last month.
The forum was attended by private sector representatives primarily from the Philippine Association of Meat Processors, Inc.(PAMPI) and Pampanga Association of Meat Processors (PAMPRO).
“They proposed that COMI be secured only if their buyers require it,” the DTI added.
A COMI is needed to withdraw imported meat from NMIS-accredited cold storage warehouses.
The industry has complained to the NMIS and the Bureau of Animal Industry (BAI) about the “excessive time” needed to accomplish the required forms, which may compromise product quality and delivery times promised to buyers.
Should the requirement be retained, however, PAMPI and PAMPRO recommended that a pro-forma COMI be prepared in advance by the applicant, to be stamped “inspected” by the NMIS.
“They added that the government should focus more on strengthening post-delivery audit and conduct regular plant monitoring,” DTI said.
NMIS presented its proposed electronic filing system for COMI while the BAI demonstrated an electronic Shipping Permit (e-Shipping Permit) portal which it hopes will be fully operational in January.
The BAI’s e-Shipping Permit enables real-time notification of a shipment’s location and arrival and offers traceability for regulators.
Other permit requirements include the license to operate (LTO) and certificate of product registration (CPR) which are respectively required for the operation of meat manufacturing establishments and sale of processed meat.
Industry representatives said the processing time for obtaining LTOs and CPRs is “excessive”, as well, with the LTO taking at least 91 days and the CPR over 114 days.
There are more than 100 meat processing establishments in the Philippines, currently employing around 22,000. — Janina C. Lim

Gov’t borrowing falls amid decline in T-bond issues

GOVERNMENT borrowing fell in the first half after the Bureau of the Treasury (BTr) made fewer awards of long-term debt paper amid rising yields.
The government borrowed a total of P460.86 billion in the first six months, down 8.88% year-on-year.
This is equivalent to 47.42% of the P971.87 billion overall gross borrowing budgeted for this year according to the Budget of Expenditures and Sources of Financing (BESF).
Funds borrowed from foreign sources during the first half grew 11.93% to P155.82 billion, but this was more than offset by the 16.78% drop to P305.04 billion in domestic borrowing.
Treasury bond (T-bond) issues declined 24.63% to P116.69 billion.
The BTr has said that banks seeking higher yields led to partial T-bond awards, amid expectations of policy tightening by the central bank as inflation rose. In the first half, the Bangko Sentral ng Pilipinas raised interest rates by 25 basis points each in May and June as inflation averaged 4.3% in the first half, above its 2-4% target.
Retail Treasury Bond (RTB) acceptances also fell during the period to P121.77 billion, compared with P181.85 billion a year earlier.
On the foreign borrowing side, program loans rose slightly while project loans fell. In March, the Philippines issued its first-ever renminbi-denominated “panda” bonds worth P12.01 billion.
In June, gross borrowings tripled to P159.98 billion from P52.96 billion a year earlier.
This was driven by a 215.69% surge in funds borrowed locally to P154.59 billion, as well as a 35.29% increase to P5.39 billion in loans from overseas.
The government issued P21.09 billion in Treasury bills (T-bills) in June, against P14.94 billion a year earlier, but issued T-bonds worth P11.73 billion, significantly less than the year-earlier P34.03 billion.
It raised P121.77 billion from RTBs that month. — Elijah Joseph C. Tubayan

Peso books slight gains vs dollar ahead of low-level US-China talks

THE PESO strengthened slightly against the dollar on Monday as markets await the minutes of the latest meeting of the US Federal Reserve and trade talks between Washington and Beijing.
The local unit ended the session on Monday at P53.38 versus the greenback, 4.5 centavos stronger than the P53.425-per-dollar finish on Friday.
The peso traded stronger the whole day, opening the session at P53.38 versus the dollar. It climbed to as high as P53.37 intraday, while its worst showing for the day stood at P53.41 against the greenback.
Dollars traded declined to $424.35 million during yesterday’s session from the $581.88 million that switched hands last Friday.
On Monday, a foreign currency trader said the peso moved sideways as the market awaits “light data” to be released this week.
“Investors will likely to monitor possible hawkish cues from the August Fed meeting minutes scheduled to be released on early Wednesday, which might point towards a possible rate hike in September,” another trader said in an e-mail.
The US central bank’s Federal Open Market Committee opted to leave policy rates unchanged at its July 31-Aug. 1 meeting. However, the Fed is widely expected to tighten its benchmark rates next month.
Meanwhile, the second trader added the peso still closed stronger on the back of “continued optimism” on the trade talks between China and the United States despite the less volatile trade ahead of the holiday on Tuesday.
“There’s more of remittance that pushed the peso stronger intraday but at the same time there’s some buying level as the currency market was quite range trading for the day,” the first trader noted.
Local financial markets are closed on Tuesday in observance of Ninoy Aquino Day and Eid al-Adha.
Most Asian currencies started the week on a high note after news of impending lower-level trade talks between the United States and China returned risk appetite to regional markets.
The greenback was flat on Monday after slipping about 0.6% on Friday, as investors exited the safe-haven currency.
“China and US restarting trade talks, no matter how tentative they are, will undoubtedly be a positive development for risk appetite. Even if nothing conclusive may be achieved this week, at minimum there could be an implicit promise of a ceasefire with no escalation in the interim,” Mizuho Bank said in a note.
Low-level Sino-US talks are expected later this week, the two governments had said. Reports suggested the talks in Washington would take place on Aug. 21 and 22, just before US tariffs on Chinese exports are due to take effect.
In Asia, emerging market currencies recovered from a widespread sell-off last week, brushing off the fallout from the collapse in Turkey’s lira. — K.A.N. Vidal with Reuters

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