Vietnam expands massive bank rescue effort on deposit exodus

June 4, 2024 | 5:44 pm

HANOI — Vietnam’s central bank lent another $1.2 billion to ailing Saigon Joint Stock Commercial Bank over the last two months, according to a bank document seen by Reuters, taking the total to $24.5 billion as part of its efforts to rescue depositors.

The massive bailout of Saigon Joint Stock Commercial Bank’s (SCB) depositors has so far cost the central bank the equivalent of 6% of Vietnam’s 2023 gross domestic product (GDP) in special loans.

Reuters reported in April that the central bank had mounted an “unprecedented” rescue of SCB, a lender engulfed in the nation’s biggest financial fraud, which a source at that time said would collapse without the funding.

As of May 29, the central bank had lent SCB VND622.7 trillion ($24.5 billion), according to the document prepared by SCB that detailed daily injections into the bank to keep track of the funds and their use, up from VND592.7 trillion ($23.3 billion) as of April 2.

SCB used the central bank funds to help it settle withdrawals and payments of VND626.9 trillion since October 2022 when the lender was put under central bank supervision, the document showed. At that time, it had deposits of VND669 trillion.

The State Bank of Vietnam and SCB, previously one of the country’s largest commercial lenders by deposits, did not reply to Reuters’ requests for comment. The State Bank of Vietnam confirmed in April it was providing financial support to SCB.

The run on SCB was triggered by the October 2022 arrest of real estate tycoon Truong My Lan, who in April was sentenced to death after being found guilty of masterminding a huge fraud at the bank.

Judges concluded that she siphoned off $12.5 billion in loans from SCB to shell companies while effectively controlling the bank through proxies. She pleaded not guilty and has appealed the ruling.

Under Vietnam’s official deposit guarantee scheme, only about $5,000 is covered per depositor per bank, but as of early April, the central bank’s cash injections into SCB amounted to about a quarter of Vietnam’s foreign exchange reserves.

The central bank has not said how it has funded its large-scale lending to SCB, but money supply rose by about $82 billion between September 2022, the month before SCB’s bailout began, and February 2024, the latest public data showed.

That is a 15% increase, compared to GDP growth of nearly 6% in roughly the same period, according to Reuters’ analysis of data from the central bank and Vietnam’s statistics office.

The Southeast Asian country’s foreign reserves, meanwhile, have remained largely stable, although the central bank has sold dollars in recent weeks to prop up its currency.

RESTRUCTURING ROADMAP
SCB’s woes occurred as Vietnam’s banking sector was facing heightened risks from prolonged turmoil in the country’s real estate industry, triggering concerns about broader risks to the financial system.

In April, the State Bank of Vietnam said it was continuing to support SCB under a roadmap for its restructuring — a move that ratings agency Fitch said last month was a positive sign of the central bank’s commitment to help significant lenders.

While the SCB’s woes showed shortcomings in Vietnam’s financial supervision, Fitch added, the unprecedented rescue efforts had not created new contagion risks in the country’s banking system.

But the increase in money supply came at a time when the Vietnamese dong weakened and contributed to a pick-up in inflation, which in May exceeded 4.4%, the highest since January 2023. — Reuters

German army to boost Rheinmetall artillery shell order by 200,000, document shows

June 4, 2024 | 5:39 pm

Germany Flag — A German national flag flies atop the illuminated Reichstag building in Berlin, Germany. — REUTERS

BERLIN — The German army intends to order 200,000 more artillery shells from armsmaker Rheinmetall than it had planned, a letter seen by Reuters on Tuesday from the Defense Ministry to parliament’s budget committee.

The army plans to get 200,000 additional 155mm artillery shells worth about €880 million ($960 million) within its framework agreement with the defence firm, the letter said.

It had already agreed to a €1.2-billion deal for several hundred thousand shells, fuses and charges.

The new shells are meant to refill the army’s depots as Germany helps supply Ukraine as it fights off the Russian military, which invaded in 2022.

As Western governments beef up their military and replenish their stocks after supplying arms to Kyiv, Rheinmetall, whose market value has more than quadrupled since the war in Ukraine, is seeing a sharp increase in orders.

By placing the order, the German defense ministry also wants to ensure that Rheinmetall can set up a new production line in the central German town of Unterluess.

Rheinmetall, one of the biggest producers of artillery and tank shells in the world, began ramping up production after Russia’s invasion of Ukraine, where the need for ammunition has exacerbated a shortage and left European manufacturers struggling to meet demand.

Der Spiegel magazine had originally reported the increase. — Reuters

Myanmar junta arrests dozens in bid to stabilize currency

June 4, 2024 | 5:39 pm

Flag of Myanmar | STOCK PHOTO | Image by www.slon.pics on Freepik

MYANMAR’s junta is cracking down on gold and foreign exchange traders and agents selling foreign real estate, with 35 arrests announced in the last two days as part of efforts to stabilise its rapidly depreciating currency.

State media said these include five people charged with illegally selling condominium units in Thailand and 14 people arrested for allegedly destabilizing the foreign currency exchange rate.

The Myanmar kyat (MMK) currency hit a record low last week, plummeting to around 4,500 per dollar on the black market, according to five foreign exchange traders.

Black market rates for the MMK have for years been significantly higher than the reference rate of Myanmar’s central bank, currently set at 2,100 MMK per dollar.

“The government is working towards the stability of the country and the rule of law,” the Global New Light of Myanmar newspaper said on Tuesday, carrying photographs of over a dozen suspects. “Security organizations have taken action against business people engaged in speculation to hinder the country’s economic development,” it said.

Another 21 people have been arrested for allegedly destabilizing gold prices, the newspaper reported on Monday.

The impoverished Southeast Asian country of about 55 million people has been in political and economic turmoil since a 2021 coup when the military ousted an elected civilian government after a decade of tentative democracy and economic reform.

Myanmar’s economy, already fragile after decades of military rule and the pandemic, has wilted since the coup, with foreign investment drying up, exacerbated by western sanctions.

Poverty rates have almost doubled from 24.8% in 2017 to 49.7% in 2023, according to the United Nations Development Programme.

The shadow National Unity Government (NUG), comprising former lawmakers and other junta opponents, said the military government has printed large volumes of currency since taking power and ramped up military spending, exacerbating the country’s economic problems.

A junta spokesman did not respond to a call from Reuters seeking comment.

“We understand that they are continuing to print kyat,” NUG finance minister Tin Tun Naing said at an online press conference on Monday. — Reuters

India’s Modi eyes biggest win yet as votes are counted in giant election

June 4, 2024 | 5:38 pm

NEW DELHI — India’s Prime Minister Narendra Modi is expected to win a record-equaling third consecutive term in office as the counting of 642 million votes in the world’s largest election began on Tuesday.

TV exit polls broadcast after voting ended on June 1 projected a big win for Mr. Modi, but exit polls have often got election outcomes wrong in India.

However, if Mr. Modi’s victory is confirmed, his Hindu nationalists will have triumphed in a vitriolic campaign in which parties accused each other of religious bias and of posing a threat to sections of the population.

Investors have already cheered the prospects of another Modi term, expecting it to deliver further years of strong economic growth and pro-business reforms, while a possible two-thirds majority in parliament could allow major changes to the constitution, rivals and critics fear.

“The next government’s main task will be to set India on the path of getting rich before it ages,” the Times of India newspaper said in an editorial on Tuesday, referring to the young, working age population in the world’s most populous nation. “The clock’s ticking.”

India stock futures edged higher and the rupee was steady before the count began at 8:00 a.m. (0230 GMT) on Tuesday. The NIFTY 50 index futures rose 0.21% in early trade, according to NSE International Exchange data, and was looking at another record high open.

TV exit polls released on Saturday after voting ended projected the BJP-led National Democratic Alliance could win a two-thirds majority in the 543-member lower house of parliament.

Several major polls projected the BJP alone could win more than the 303 it won in 2019.

The projections pushed Indian shares to lifetime highs on Monday while the rupee gained and bond yields dropped.

Nearly one billion people were eligible to vote in the seven-phase, seven-week poll which began on April 19 and held in searing summer heat with temperatures touching nearly 50° Celsius (122° Fahrenheit) in some parts.

More than 66% of registered voters turned out, just one percentage point lower than the previous election in 2019, squashing pre-poll concerns that voters might shun a contest thought to be a foregone conclusion in Modi’s favor.

Mr. Modi, 73, who first swept to power in 2014 by promising growth and change, is seeking to be only the second prime minister after India’s independence leader Jawaharlal Nehru to win three straight terms.

He began his campaign by showcasing his record in office including economic growth, welfare policies, national pride, Hindu nationalism and his own personal commitment to fulfilling promises which he called “Modi’s Guarantee.”

However, he changed tack after low voter turnout in the first phase and accused the opposition, especially the Congress party which leads an alliance of two dozen groups, of favoring India’s 200 million Muslims — a shift analysts said made the campaign coarse and divisive.

They said the pivot may have been aimed at firing up the Hindu nationalist base of Modi’s Bharatiya Janata Party (BJP) to draw them to vote. Modi defended himself against criticism that he was stoking divisions between Hindus and Muslims to win votes and said that he was only faulting the opposition campaign.

The opposition INDIA alliance, led by Rahul Gandhi’s Congress party, denied it favoured Muslims in the Hindu-majority country and said Modi would destroy the constitution if he returned to power and end affirmative action enjoyed by the so-called backward castes. The BJP rejects this.

The opposition alliance also promised more welfare measures and handouts, with surveys saying unemployment, inflation and rural distress were the main concerns of voters. — Reuters

Johnson & Johnson must pay $260M in latest talc trial, Oregon jury says

June 4, 2024 | 5:38 pm

Johnson-&-Johnson-baby-powder — IMAGE BY MIKE MOZART/FLICKR/ CC BY 2.0

JOHNSON & JOHNSON (J&J) must pay $260 million to an Oregon woman who said she got mesothelioma, a deadly cancer linked to asbestos exposure, from inhaling the company’s talc powder, a jury found on Monday.

The verdict in the 4^th Judicial District Circuit Court in Portland comes as the company continues to pursue a proposed $6.48 billion settlement of most talc-related lawsuits against it through a prepackaged bankruptcy.

The jury’s award includes $60 million in compensatory damages and $200 million in punitive damages, and includes damages for both the plaintiff and her husband.

Erik Haas, J&J’s worldwide vice president of litigation, said in a statement that the verdict “is irreconcilable with the decades of independent scientific evaluations confirming talc is safe, does not contain asbestos, and does not cause cancer.”

He said the company would appeal and was confident it would get the verdict reversed.

The plaintiff in the case, Kyung Lee, was diagnosed last year with mesothelioma at age 48.

Ms. Lee alleged that she inhaled asbestos-tainted talc over more than 30 years, beginning when her mother used it on her when she was a baby and later when she used it herself as a deodorant.

J&J maintains that its talc products do not contain asbestos and do not cause cancer, and that decades of scientific studies support their safety.

A lawyer for J&J said at trial that Ms. Lee’s illness was likely caused by exposure to asbestos used at a factory near where she grew up.

Reuters watched the trial through Courtroom View Network.

J&J faces lawsuits from more than 61,000 plaintiffs over talc. The vast majority are by women with ovarian cancer, with only a small minority involving people with mesothelioma. The company has settled most of the mesothelioma cases.

J&J needs the support of 75% of remaining plaintiffs to get approval for a bankruptcy settlement that would end the litigation, shutting off future cases and preventing people from opting out of the deal.

Courts rejected two previous efforts by the company to resolve the talc cases in bankruptcy. J&J has said it is confident that support from plaintiffs will allow the latest attempt to succeed.

A group of plaintiffs opposed to the deal on May 22 filed a class action lawsuit aiming to stop it, calling it a “fraudulent” abuse of the bankruptcy system.

Trials in the talc cases have had a mixed record, with major plaintiff wins including a $2.1 billion judgment in 2021 awarded to 22 women with ovarian cancer. In April, J&J won an ovarian cancer case and was hit with a $45 million verdict in a mesothelioma case. — Reuters

Philippine c.bank gov says rates may be cut before Fed, weighs on peso

June 4, 2024 | 1:41 pm

MANILA – The Philippine central bank governor reiterated on Tuesday that the benchmark rate could be cut ahead of the Federal Reserve, keeping pressure on the peso against the dollar amid expectations US rates will stay higher-for-longer.

Governor Eli Remolona said the Bangko Sentral ng Pilipinas (BSP) is ready to take action when the peso is under stress, but added that the central bank does not intervene in the foreign exchange market on a daily basis.

“We intervene to express our own view where the peso should be going,” Mr. Remolona said.

The Philippine peso has weakened past 58 per dollar to its lowest in 19 months. So far in 2024, the peso has fallen 5.8% against the dollar.

The central bank chief said the benchmark policy rate – currently sitting at a 17-year high of 6.50% – could be cut before the Fed starts its easing cycle, repeating previous comments as policymakers gain more confidence about reining in inflation pressure.

Mr. Remolona said the BSP is already less hawkish than before as inflation could settle within its 2% to 4% comfort range sometime this year after staying above the top end of that target for two consecutive years.

The Philippine central bank, which kept its benchmark rate steady at its last five meetings, has said it was looking to cut rates by 25 basis points as early as August and by another 25 basis points in the fourth quarter.

The BSP’s stance and market pricing suggesting the Fed’s first cut could come as late as December have undermined the peso.

However, Mr. Remolona played down comments made by Finance Secretary Ralph Recto last month on the possibility of 150 basis points of rate cuts over the next two years, saying that it might be “too aggressive” given the current growth path.

“For that to happen, I think there should be a risk of a hard landing,” he added.

The Philippine economy grew 5.7% in the first quarter, lagging expectations but picking up the pace slightly from the last three months of 2023.

The World Bank on Tuesday kept its growth projections for the Philippines at 5.8% in 2024 and 5.9% next year, unchanged from its April forecasts, it said in a new report. The Washington-based lender also expects the Philippine economy to grow by 5.9% in 2026.

“The positive outlook hinges on successfully containing inflation and transitioning toward a more accommodative monetary policy, which will support private domestic demand,” the World Bank said. – Reuters

Philippine officials order evacuation, urge caution after volcano eruption

June 4, 2024 | 1:37 pm

DSWD-monitoring-kanlaon — (JUNE 4, 2024) A team from the Department of Social Welfare and Development (DSWD) monitors affected families in Regions VI and VIII at their Disaster Response Command Center inside the DSWD head office in Quezon City on Tuesday following the eruption of Mt. Kanlaon from 6:51 to 6:57 PM on Monday, June 3. (PHOTO BY MIGUEL DE GUZMAN)

MANILA – Philippine authorities ordered the evacuation of residents living near a volcano in central Philippines on Tuesday following an eruption that sent a five km (three miles) high ash cloud into the sky.

Government officials warned of the possibility of further eruptions of Kanlaon volcano, hazardous ash fall and sulphuric odor. They also warned that rivers downstream from the volcano were at risk of flash floods, mudflows and other hazards.

“Go down to your respective evacuation centers, be vigilant, and prepare important things such as water and food,” Jose Chubasco Cardenas, mayor of Canlaon City in Negros Oriental province, said in issuing the evacuation order via Facebook for residents in four communities near the volcano.

In the nearby Negros Occidental province, more than 700 people were taking shelter in evacuation centers, governor Jose Lacson told DWPM radio station.

“We advise them to stay there, and for those not yet in evacuation centers, I hope they can reconsider.”

Government agencies have yet to report missing, injured, or fatalities since the eruption on Monday.

The six-minute explosive eruption prompted the suspension of work and schools in Canlaon City, while three airlines cancelled 32 flights on Tuesday.

“We advise people to wear face masks to protect themselves from volcanic ash,” Teresito Bacolcol, chief of the state seismology agency, told DZBB radio station.

The agency raised the level for Kanlaon volcano, indicating further eruptions were possible.

Response teams have been deployed in the affected areas to move the residents to safe places, the state civil defense agency said in a statement late Monday.

Kanlaon, one of the country’s two dozen active volcanoes, last erupted in December 2017. The Philippines is in the Pacific “Ring of Fire,” where volcanic activity and earthquakes are common. – Reuters

China sees property silver lining but can’t shake Japan comparisons

June 4, 2024 | 1:06 pm

China-Beijing-skyline — A GENERAL VIEW shows Beijing’s skyline on a sunny day in this file photo. — REUTERS

BEIJING – A plunge in China’s new housing construction is fueling hopes the battered property sector is finally coming to terms with chronic oversupply, but a clean-up of bad assets is the missing policy piece that keeps Japan-like stagnation fears alive.

On paper, the world’s second-largest economy is almost where the US and Spain were when their late 2000s property crises began to stabilize, with new Chinese housing construction now at less than half its 2021 peak.

This could indicate, analysts say, that home building activity may find a bottom within a year or so, removing some of the weight China’s real estate troubles are placing on economic growth.

“It’s reasonable to expect that construction will stabilize soon,” said Rhodium Group partner Logan Wright.

New home starts in China fell 63% from their peak to 634 million square meters (7.46 billion square feet) in the 12 months through April.

Taking into account demographics and other factors, the International Monetary Fund estimates fundamental demand for housing in China to average 950 million square meters over the next 10 years.

Some of the demand would have to absorb China’s giant existing inventory, therefore the Fund projects new housing starts to average 715 million square meters – slightly above current rates.

This could mean real estate investment, whose steep 10% back-to-back annual declines JPMorgan estimates chopped 1.5 percentage points off China’s economic growth in each of the past two years, may be close to finding a floor.

George Magnus, research associate at Oxford University’s China Centre, says that could come in 2025 or even sooner.

“There is potential for a cyclical rebound, even while we’re talking about medium-term shrinkage,” in the property sector, said Magnus.

JAPAN’S FOOTSTEPS

Property investment is expected to gravitate more towards wealthy coastal areas. Shanghai and four of China’s richest provinces – Zhejiang, Jiangsu, Guangdong and Shandong – accounted for 49% of January-April investment, up from 39% five years ago.

But that is where the cyclical silver lining ends and less favorable comparisons with 1990s Japan start.

Wright estimates the industry as a whole, which used to represent about a quarter of China’s economic activity, will stabilize at 40-50% of its peak levels and never return as a driver of growth.

Prices have yet to fully adjust and the negative financial spillovers will continue, he said.

New home prices in China have fallen 11%, according to official data. JPMorgan estimates prices for older apartments dropped by a similar amount.

The 30-40% peak-to-trough plunge in the U.S. and Spanish downturns started in 2006-07 and lasted more than five years. In Japan, the correction took more than 18 years, pushing prices down by 47% in the end.

So far, China’s pace has matched Japan’s. Odds are that it will continue to do so, analysts say.

What’s missing from both the Chinese and Japanese responses to the crisis is an early recognition of losses.

Japan asked banks to purchase land to slow down the fall in prices. China achieves something similar by placing limits on how much developers can lower new home prices and through a drip-feed of other support measures.

JPMorgan analysts say this is “perhaps an intentionally chosen strategy to mitigate financial spillover risks.”

A stock of unsold homes estimated at almost twice the size of London still exists on the balance sheets of cash-strapped Chinese developers, whose debts sit on the books of banks and other institutions.

By contrast, the United States spent an initial 5% of gross domestic product to absorb toxic assets from financial institutions through its Toxic Asset Relief Program. Spain created a bad bank.

PROTRACTED ADJUSTMENT

China is not keen on sweeping bailouts, one policy adviser said, asking for anonymity to discuss a sensitive topic.

“The government has no intention to prop up the property market,” the adviser said. “It aims to stabilize it, or at least slow down its decline.”

China introduced in May a new support package for the sector, cutting mortgage rates and downpayments and instructing local governments – already $9 trillion in debt – to buy “some” unsold apartments and turn them into affordable housing.

Analysts say the purchases transfer bad assets from developers to local governments, delaying writedowns. But eventually, the losses will have to be recognized, which is why comparisons with Japan’s lost decades persist.

Alicia Garcia-Herrero, Asia Pacific chief economist at Natixis, says local governments may suffer a similar fate to the Japanese banks, which ultimately had to be recapitalized, implying a “longer, more protracted adjustment.”

“There hasn’t been a clean-up,” Ms. Garcia-Herrero said. “This is why China looks more like Japan and not like the US or Spain.”

“I do not think China’s housing prices will ever be higher on average. Tier 1 cities, maybe,” she added, referring to Beijing, Shanghai, Shenzhen and Guangzhou. – Reuters

Philippines says troops held weapons but did not point at Chinese coast guard

June 4, 2024 | 1:00 pm

Yearender_Photo1-BRP Sierra Madre — BRP SIERRA MADRE, a marooned transport ship which Philippine Marines live in as a military outpost, sits on the disputed Second Thomas Shoal, part of the Spratly Islands in the South China Sea. — REUTERS

MANILA – Philippine troops stationed on a warship grounded on a disputed South China Sea shoal held on to their weapons after Chinese coast guard boats came very close to the ship but they did not point their guns at them, military officials said on Tuesday.

Armed Forces of the Philippines Chief of Staff Romeo Brawner disputedan account by China’s state CCTV of what transpired during a routine resupply mission for Filipino troops on May 19.

CCTVhad reported at least two Filipino personnel pointed guns in their coast guards’ direction during the confrontation at BRP Sierra Madre, which Manila grounded on Second Thomas Shoal and turned into a garrison in 1999.

“It was just in preparation for self-defense in case something happens because they were very close,” Mr. Brawner told a press conference, describing the actions of the China Coast Guard as “provocative.”

Military officials said Chinese rigid hull inflatable boats came within five to 10 meters of the BRP Sierra Madre and seized some of the supplies that were air dropped for troops, actions they said were “illegal” and “unacceptable.”

“This was a cause of alarm. So our soldiers as a precautionary measure, held on to their firearms. It is part of the rules of engagement,” Mr. Brawner said.

“We are denying that any of our soldiers pointed deliberately their guns at any of the Chinese … But we will not deny the fact that they were armed,” Mr. Brawner said.

Mr. Brawner said the BRP Sierra Madre is a commissioned vessel of the Philippine navy so it is authorized to have weapons.

“We have the right to defend ourselves,” Brawner said, adding the Philippines will continue to assert its sovereignty in the area.

China claims almost the entire South China Sea, which includes the Second Thomas Shoal. It has deployed hundreds of vessels to patrol the waterway, including what Manila refers to as “Chinese maritime militia,” which it said were also present on May 19.

There was no immediate comment from the Chinese embassy in Manila. – Reuters

Taiwan president says Tiananmen crackdown will never be forgotten

June 4, 2024 | 12:55 pm

TAIPEI – Taiwan President Lai Ching-te on Tuesday said he will work hard to make historical memory last forever and reach out to everyone who cares about Chinese democracy, on the 35th anniversary of the 1989 Tiananmen Square crackdown in Beijing.

The events on and around the central Beijing square on June 4, 1989, when Chinese troops opened fire to end the student-led pro-democracy demonstrations, are a taboo topic in China and the anniversary is not marked or publicly discussed.

Public commemorations now take place in overseas cities including Taipei where senior Taiwan government leaders sometimes use the anniversary to criticize China and urge it to face up to what it did.

Mr. Lai said in a post on Facebook that it is important to respond to authoritarianism with freedom and that the memory of June 4th will not disappear.

“This reminds us that democracy and freedom do not come easily and that we must build consensus with democracy and responds to authoritarianism with freedom,” Mr. Lai wrote.

“The memory of June 4th will not disappear in the torrent of history. We will continue to work hard to make this historical memory last forever and move everyone who cares about Chinese democracy.”

China detests Mr. Lai and calls him a “separatist”.

Last month China carried out war games around Taiwan in what it said was “punishment” for Mr. Lai’s separatism.

Mr. Lai and his government reject Beijing’s sovereignty claims, saying only Taiwan’s people can decide their future. Mr. Lai has repeatedly offered talks with China but been rebuffed. – Reuters

China’s Chang’e-6 probe lifts off from far side of moon

June 4, 2024 | 12:52 pm

BEIJING – China’s Chang’e-6 probe has lifted off from the far side of the moon, starting its journey back towards Earth, China’s national space agency announced on Tuesday.

The probe’s successful departure from the moon means China is closer to becoming the first country to return samples from the far side of the moon, which permanently faces away from Earth.

The probe, which departed the moon at 7:38 am local time (2338 GMT) successfully completed its sample collection from June 2-3.

China’s National Space Administration (CNSA) said in a statement that Chang’e-6 “withstood the test of high temperature on the far side of the moon”.

Compared with its predecessor Chang’e-5, which retrieved samples from the near side of the moon, Chang’e-6 faced an additional technical challenge of operating without direct communications with ground stations on Earth, according to CNSA.

Instead, the probe relied on relay satellite Queqiao-2, put into orbit in April, for communications.

The probe used a drill and robotic arm to dig up soil on and below the moon’s surface, according to state news agency Xinhua.

Chang’e-6 displayed China’s national flag for the first time on the far side of moon after sample acquisition, Beijing Daily said.

The probe is now in lunar orbit and will join up with another spacecraft in orbit, CNSA said on Tuesday morning.

The samples will then be transferred to a return module, which will fly back to Earth, with a landing in China’s Inner Mongolia region expected around June 25.

The return of the lunar samples to Earth is being followed by scientists around the world, who hope the soil collected by the Chang’e-6 can help answer questions about the origins of the solar system. – Reuters

Bangladeshi garment workers fall ill as temperatures soar

June 4, 2024 | 12:50 pm

banani-2978376_1280 — STOCK PHOTO | Image by Mohammad Rahmatullah from Pixabay

DHAKA (Thomson Reuters Foundation) – In the factory where Aysha Talukder Tanisa stitches jeans and children’s clothes for Western brands, the cooling system has been no match for Bangladesh’s longest heatwave in 70 years.

“Some of us – mostly girls – fall sick, vomiting or swooning due to the boiling heat,” the 22-year-old told the Thomson Reuters Foundation by phone from Ashulia, a town near the capital, Dhaka.

Temperatures soared to more than 40 degrees Celsius (104 Fahrenheit) in late April, taking a particularly heavy toll on factory workers including most of Bangladesh’s four million garment industry employees, 60% of whom are women.

Around the world, more than two-thirds of workers have been exposed to excessive heat while doing their jobs, a U.N. report said in April.

Bangladesh loses $6 billion a year in labour productivity due to the effects of extreme heat, according to a study published by the Adrienne Arsht-Rockefeller Foundation Resilience Center.

As climate change fuels the frequency and intensity of heatwaves, leaders of the country’s crucial garment industry are scrambling to implement measures to protect workers.

“Heat poses a serious business risk for the apparel industry,” said Manirul Islam, deputy director at Bangladesh Institute of Labour Studies (BILS).

Islam, who surveyed more than 400 garment workers, said one in five workers had to go on sick leave at least once during the hottest months due to the effects of heat, and 32% said their working abilities sank due to the sweltering conditions.

Some leading clothing manufacturers are taking steps to keep workers safe, but labour rights activists say protecting workers’ health and productivity requires more money and commitment from suppliers, brands, and the government.

The DBL Group, which employs about 35,000 workers and supplies some of the world’s biggest clothing retailers, has been ensuring employees have drinking water on hand and oral hydration salts, said Mohammed Zahidullah, chief sustainability officer at the family-owned conglomerate.

Water sprinklers are being used to cool the roofs of factories that get particularly hot during the summer, he added.

Team Group, another leading clothing supplier in Bangladesh that employs about 23,000 people, uses exhaust fans to keep indoor temperatures 4-5 C (7.2 F-9 F) cooler than outside, said Md. Monower Hossain, head of sustainability at the group.

“We also use double-glazed glass at one side of the factories which allows in sunlight but wards off the heat – keeping the inside cool and well-lit,” he added.

In factory compounds, the company is trying nature-based cooling solutions, such as planting trees and installing water features such as ponds and fountains.

SWELTERING COMMUTES, CROWDED HOMES

But keeping factories cool does not protect workers during their commutes, or at home, where many live in tiny, crowded houses with shared kitchen and bathroom facilities, said Guy Stuart, executive director of the Global Worker Dialogue (GWD) who runs regular surveys into workers’ conditions.

The minimum monthly wage for a seamstress in Bangladesh is about 13,300 taka ($113), putting costly air conditioning and generators out of reach.

Yousuf Bin Ibrahim, a garment worker in his early 30s from the central city of Narayanganj, said frequent power cuts render useless the electric fans he bought for his rented flat.

“(It) gets too hot to bear for me and my kids in the summer days,” he said, adding that it was often more comfortable at work.

Nearly 19,000 people die every year due to workplace injuries attributed to excessive heat, and an estimated 26.2 million people are living with chronic kidney diseases linked to workplace heat stress, according to last month’s report by the U.N.’s International Labour Organization (ILO).

As climate change increases the risk of extreme heat, Zahidullah said manufacturers will need to make big changes to existing factories and climate-proof newly built premises.

“Going forward, we should consider a scenario when summer heatwaves will climb to, say, 45 C (113 F),” he said.

As head of operations at energy technology firm Grit Technologies Limited, Sudip Paul has spent years helping factories address climate-related challenges. He said simple, inexpensive steps can make a difference.

They could include starting shifts at 6 a.m. rather than 8 a.m., so workers can go for lunch before the midday heat peaks, providing them light cotton clothing and white parasols for the walk home, besides proper maintenance of cooling fans, Paul said.

Such measures are welcome, but the government and investors must do more to tackle the threat of rising heat, said Zahangir Alam, who has worked for three decades with top global brands – including H&M, Walmart and Denmark’s Bestseller – on labour issues and sustainability.

Bangladesh needs to put in place a clear legal standard on what temperature is permitted inside factories, rather than simply saying it should be “within tolerable limits” as it does at present, Alam said.

“The government should up its game and set down a national strategy to deal with the heat risk in industry – while brands should step up to financially support actions to protect workers,” he added. – Reuters