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Reimagining ageing: Older persons as agents of development

STOCK PHOTO | Image by Danie Franco from Unsplash

OLDER PERSONS are highly visible across Asia and the Pacific: they work in agricultural fields producing our food supplies, peddle their wares as street vendors, drive tuk-tuks and buses, exercise in our parks, lead some of the region’s most successful companies, and form an integral part of our families.

Indeed, population ageing is one of the megatrends greatly affecting sustainable development. People now live longer than ever and remain active because of improved health. We must broaden the narrow view of older persons as requiring our care to recognize that they are also agents of development. With many parts of the Asia-Pacific region rapidly ageing, we can take concrete steps to provide environments in which our elders live safely, securely and in dignity and contribute to societies.

To start with, we must invest in social protection and access to universal healthcare throughout the life-course. Currently, it is estimated that 14.3% of the population in Asia and the Pacific are 60 years or older; that figure is projected to rise to 17.7% by 2030 and to one-quarter in 2050. Moreover, 53.1% of all older persons are women, a share that increases with age. Therefore, financial security is needed so older persons can stay active and healthy for longer periods. In many countries of the region, less than one-third of the working-age population is covered by mandatory pensions, and a large proportion still lacks access to affordable, good quality healthcare.

Such protection is crucial because older persons continue to bolster the labor force, especially in informal sectors. In Thailand, for example, a third of people aged 65 years or over participate in the labor force; 87% of working women aged 65 or over work in the informal sector, compared to 81% of working men in the same cohort. This general trend is seen in other countries of the region.

Older persons, especially older women, also make important contributions as caregivers to both children and other older persons. This unpaid care enables younger people in their families to take paid work, often in metropolitan areas of their own country or abroad.

Older persons should also have lifelong learning opportunities. Enhanced digital literacy, for example, can close the grey digital divide. Older women and men need to stay abreast of technological developments to access services, maintain connections with family and friends, and remain competitive in the labor market. Through inter-generational initiatives, younger people can train older people in the use of technology.

We must also invest in quality long-term care systems to ensure that older persons who need it can receive affordable quality care. With the increase in dementia and other mental health conditions, care needs are becoming more complex. Many countries in the region still rely on family members to provide such care, but there may be less unpaid care in the future, and care by family members is not always quality care.

Finally, addressing age-based discrimination and barriers will be crucial to allow the full participation of older persons in economies and societies. Older women and men actively volunteer in older persons associations or other organizations. They help distribute food and medicine in emergency situations, including during the COVID-19 pandemic, monitor the health of neighbors and friends, or teach each other how to use digital devices. Older persons also play an active role in combatting climate change by sharing knowledge and techniques of mitigation and adaptation. Ageism intersects and exacerbates other disadvantages, including those related to sex, race, and disability, and combatting it will contribute to the health and well-being of all.

This week*, countries in Asia and the Pacific will convene to review and appraise the Madrid International Plan of Action on Ageing (MIPAA) on the occasion of its 20th anniversary. MIPAA provides policy directions for building societies for all ages with a focus on older persons and development; health and well-being in old age; and creating enabling environments. The meeting will provide an opportunity for member States to discuss progress on the action plan and identify remaining challenges, gaps, and new priorities.

While several countries in the region already have some form of policy on ageing, the topic must be mainstreamed into all policies and action plans, and they must be translated into coherent, cross-sectoral national strategies that reach all older persons in our region, including those who inhabit remote islands, deserts or mountain ranges.

Older persons are valuable members of our societies, but too often they are overlooked. Let us ensure that they can fully contribute to our sustainable future.

* The meeting was held from June 29 to July 1 in Bangkok, Thailand.

Marcos Jr. faces a balancing act

Ferdinand “Bongbong” R. Marcos, Jr. took his oath of office as the 17th president of the Philippines before Chief Justice Alexander Gesmundo at the National Museum of Fine Arts in Manila on June 30. — PHILIPPINE STAR/KRIZJOHN ROSALES

President Bongbong Marcos has inherited an economy that is barely able to make ends meet. In fact, it depends on debt to fill its budgetary gaps. That said, the Marcos Jr. administration can’t afford to make a mistake nor can it adopt populist policies that erode national revenues. At this point, every centavo counts.

Buoyed by a debt-to-GDP ratio of just 42.1%, government international reserves of $83 billion, and a budget deficit of only 2.4% when President Rodrigo Duterte inherited the reins of government in 2016, Mr. Duterte went on a borrowing and spending spree to fund infrastructure and his pet projects. The situation was exacerbated by the pandemic in which the government needed to borrow more to fund the country’s emergency healthcare needs and to provide lifelines for the poor.

From a public debt of roughly P5.9 trillion in 2016, debts doubled to P12.68 trillion as of April this year representing 63.5% of GDP. In other words, the Philippines owes P63.5 for every P100 worth of goods and services it produces. Our debt-to-GDP ratio surpasses the government’s limit of 59.1% and the international standard of 60%.

The Duterte administration will pass on to Marcos Jr. the highest ratio of maturing debts since Erap bowed out and GMA took over. It will be recalled that when Erap was ousted, 17.9% of debts were falling due within the year and 22.5% were falling due in the medium term.

The situation is worse now. As of the beginning of 2021, 33.4% of all debts will be falling due within the decade of which 6.8% or P834 billion is payable within this year.

Over dinner with Finance Secretary Ben Diokno last week, our cadre of economists from BusinessWorld were assured that the situation is still manageable. After all, 73% of our debt stock comes from local creditors while only 27% come from foreign sources, said the finance chief. Our foreign debt-to-GDP ratio is the lowest among the five biggest economies of ASEAN.

I asked the secretary if he is likely to increase taxes or create new levies. He said no. He would rather focus on tax collection efficiency. Tough call, I thought, considering the President would have to lead by example and settle his own tax liabilities first.

Our bloated debt situation leaves the Marcos administration with no choice but to cut spending whilst sustaining investments in infrastructure and social services. It leaves it little room to borrow to sustain economic growth. And here lies the conundrum.

The economy needs to grow by at least 6% until 2028 for us to ensure our capacity to pay while decreasing our debt-to-GDP ratio. How can Marcos grow the economy while simultaneously cutting down on spending? It will be a delicate balancing act.

The IMF recommends adjusting personal income taxes, particularly wealth tax for billionaires. Records show that Filipino billionaires saw their wealth increase by over 35% during the pandemic while 3.7 million Filipinos fell into extreme poverty. Only 143,000 families control 70% of the country’s economic output.

Government can raise up to $6.3 billion a year if a 2% tax is imposed on wealth of over $5 million, 3% for wealth of over $50 million, and 5% for wealth of over $1 billion. This will be sufficient to cover our revenue gap.

Taxing the richest 1% of the population will not choke our consumer-driven economy as it would if the poor were to be taxed. This is why taxing billionaires makes sense. The problem is — most billionaires belong to political dynasties and/or have political influence. Will our politicians impose taxes on themselves and their benefactors? I doubt it. The likely scenario is that the middle and lower classes will be made to foot the bill.

The dinner with Secretary Diokno was also attended by incoming Department of Budget and Management Secretary Mina Pangandaman. I asked her if the allegation of a presidential candidate was true that some P700 billion out of our P5-trillion national budget is pilfered through graft and corruption. Pangandaman said it was fairly accurate.

If the Marcos Jr. administration is able to cut pork barrel and frivolous budget insertions, the budget can go a longer way towards pump priming the economy and debt service. In other words, fiscal discipline will be a must. But will our legislators be willing to cooperate? They were unwilling to sacrifice their pork barrel funds before — what makes us think that they will be willing now? It will be a test of political will on Marcos’ part.

Notwithstanding the tight finances, Marcos’ economic team is confident that the economy can grow its way out of its debts. Per the government’s forecast, the economy is expected to expand by 7-9% this year and by 6-7% in 2023 and 2024. These projections, however, are subject to adjustments given external factors such as the Ukraine war, the Chinese lockdown, and tensions in the Taiwan Strait. It is also contingent on successful reforms to improve agriculture and manufacturing outputs.

Adding pressure to the incoming administration is the budget deficit. Last year, the country registered the largest budget deficit in recent history at 8.6% of GDP. This is due to the reduced revenues brought about by the pandemic and increased spending on infrastructure and healthcare. The goal, according to Mr. Diokno, is to bring this number down to 3% by 2028. All the more reason to clamp down on pork barrel funds and channel our resources to where we get the most bang for the buck.

It is going to be a tight balancing act for the Marcos Jr. administration. It must raise tax revenues without further burdening a population besieged with high inflation. It must cut spending without choking economic expansion. It must spend on infrastructure and social services without widening the budget deficit. It must raise funds without acquiring more debts.

Now the real work of governance begins.

 

Andrew J. Masigan is an economist

andrew_rs6@yahoo.com

Facebook@AndrewJ. Masigan

Twitter @aj_masigan

Plastic-munching bacteria offer hope for recycling

NAJA BERTOLT JENSEN-UNSPLASH

OUR LAKES, rivers and oceans are increasingly clogged with plastic, plus trillions of microscopic fragments thereof, from all the useful and disturbingly durable products made possible by the petroleum industry. This deluge of waste has grown exponentially over 60 years. Some 10 million tons of bottles, nets, bags, buckets, and food wrappings are deliberately or indifferently dumped each year into our waterways, where they entangle and kill marine life and damage the organs of the creatures, including, possibly, humans, that ingest them.

What can we do? For 70 years, we’ve been trying to recycle plastic, without much success. Some think it will never truly work, in large part because there are many different types of plastics, and they generally can’t be recycled together. Also, recycling is still more expensive than manufacturing new plastic; the plastics industry is expected to produce three times as much plastic in 2040 as it does today.

Plastic has become so enmeshed in our ecosystem that bacteria have evolved to digest it.

Oddly enough, those bugs might now offer a ray of hope. A key barrier to cost-effective recycling is finding chemical enzymes able to break down plastic quickly, recovering the molecules originally used to make it, a crucial initial step in reforming and reusing the material.

By studying these plastic-eating bacteria, scientists have discovered some enzymes able to break down plastics far faster than was possible a decade ago. That’s a big advance from traditional recycling, which uses heat to melt plastic, leading to degraded and less useful material. Having demonstrated the new technique, a company in France called Carbios expects to soon be recycling 50,000 tons of plastic each year.

But this is likely just a beginning. The greater hope for big breakthroughs in recycling chemistry comes from our current spectacular ignorance of the microbiology of the seas, and the genomics and computing technology now gearing up to change that.

We know very little about the world’s microbes. When biologists study the genetic content of seawater samples, two-thirds of what they find is unlike anything from known organisms. A recent study by researchers at the Institute of Microbiology at ETH Zurich, for example, used computational genomics to analyze more than 1,000 samples of seawater from many locations and depths and ended up producing the full genomes of some 26,000 organisms, 2,700 of which were previously unknown. (We also don’t know much about microbes in the soil. Some 99% of the genes identified in random samples of topsoil aren’t found in databases of known microbial genes.)

The microbiome — the universe of all microbial organisms — is a treasure chest of chemical leads about possible new drugs and other potentially useful biochemical compounds. The ETH Zurich study alone found more than 40,000 new biosynthetic gene clusters — biologists’ term for small clusters of associated genes that together help produce some particular bioactive molecule. For scientists, these are prime candidates in the search for new and useful pharmaceutical compounds.

Such studies are also helping scientists identify new enzymes able to digest plastics. In a study published last year, biologist Aleksej Zelezniak of Chalmers University of Technology in Sweden and colleagues identified plastic-degrading enzymes in the genomes of many bacteria, including those in the ocean and in soils. Among the ocean bacteria, they also noted a strong correlation between the diversity of such enzymes and the amount of local plastic pollution. In the brief 60 years that plastics pollution has been with us, bacteria already have responded by evolving a biochemistry to digest plastic as a food source.

In turn, this bacterial engineering offers clues about how we might produce better enzymes for recycling. From this bacterial data, using modern genomics methods and machine learning, the researchers were also able to identify more than 30,000 new candidate molecules expected to have powerful plastic-digestive properties for at least 10 different types of plastic.

There are, of course, other barriers to plastic recycling, not least a broad lack of public engagement. That’s beginning to change, spurred in part by China’s ban on importing plastic waste, which has made it harder for Western nations to hide their plastic pollution by shipping it far away.

But we need much stronger commitments from governments to tax plastic packaging and encourage packing alternatives that use less plastic, or don’t use any at all. If we take these steps, it isn’t too crazy to hope that, in 10 or 20 years, armed with more knowledge of the marine microbiome, scientists may find their way to a set of enzymes able to rapidly digest the many kinds of plastics industry might produce. If that happens, there could be hope for the oceans after all.

BLOOMBERG OPINION

Blasts kill three in Russian city near Ukraine border

MAX KUKURUDZIAK-UNSPLASH

KYIV/KONSTYANTYNIVKA, Ukraine, — At least three people were killed and dozens of homes damaged in the Russian city of Belgorod near the Ukraine border, the regional governor said on Sunday, as Kyiv acknowledged it could lose its last big bastion in eastern Ukraine to Kremlin forces.

Governor Vyacheslav Gladkov reported a number of blasts in the city of nearly 400,000 some 40km (25 miles) north of the border with Ukraine.

At least 11 apartment buildings and 39 houses were damaged, including five that were destroyed, Gladkov said on the Telegram messaging app.

Senior Russian lawmaker Andrei Klishas accused Ukraine of shelling Belgorod and called for a military response.

“The death of civilians and the destruction of civilian infrastructure in Belgorod are a direct act of aggression on the part of Ukraine and require the most severe — including a military — response,” Mr. Klishas wrote on Telegram.

Moscow has accused Kyiv of several attacks on Belgorod and other regions bordering Ukraine since Russia’s Feb 24 invasion. Ukraine has not claimed responsibility but has described the incidents as payback and “karma” for Russia’s invasion.

There was no immediate reaction from Ukraine to the latest attack and Reuters could not independently verify the Russian accounts.

Thousands of civilians have been killed and cities leveled since Russia invaded in what Ukraine and its Western allies say is an unprovoked war of aggression. Russia denies targeting civilians in what President Vladimir Putin calls a “special military operation” to demilitarize and “denazify” its neighbor.

Russia is focussed on driving Ukrainian forces out of Luhansk and Donetsk provinces in the Donbas, where Moscow-backed separatists have been fighting Kyiv since Russia’s first military intervention in Ukraine in 2014.

Ukrainian troops on the eastern front lines described intense artillery barrages on residential areas, especially around Lysychansk, the last holdout city in Luhansk.

Russian forces seized Lysychansk’s sister city Sievierodonetsk, across the Siverskiy Donets river, last month after some of the heaviest fighting during the war.

Rodion Miroshnik, ambassador to Russia of the pro-Moscow self-styled Luhansk People’s Republic, told Russian television: “Lysychansk has been brought under control,” but added: “Unfortunately, it is not yet liberated.”

Russian media showed video of Luhansk militia parading in Lysychansk streets waving flags and cheering, but Ukraine National Guard spokesman Ruslan Muzychuk told Ukrainian television the city remained in Ukrainian hands.

“Now there are fierce battles near Lysychansk, however, fortunately, the city is not surrounded and is under the control of the Ukrainian army,” Mr. Muzychuk said.

Reuters could not independently verify the battlefield reports.

Zelensky adviser Oleksiy Arestovych said Russian forces had finally crossed the Siverskiy Donets river and were approaching the city from the north.

“This is indeed a threat. We shall see. I do not rule out any one of a number of outcomes here. Things will become much more clear within a day or two,” he said.

Arestovych said, however, that taking Lysychansk would complicate matters strategically for the Russians as they would have to focus on six major cities in the industrialized eastern Donbas region, spreading their forces more thinly.

He added: “The more Western weapons come to the front, the more the picture changes in favor of Ukraine.” Ukraine has repeatedly appealed for more weapons from the West, saying its forces are heavily outgunned.

‘VERY DIFFICULT PATH’

Far from the eastern fighting, Russia said it had hit army command posts in Mykolaiv near the vital Black Sea port of Odesa, where the mayor on Saturday had reported powerful explosions.

Ukrainian authorities said another missile slammed into an apartment block near Odesa on Friday, killing at least 21 people. A shopping mall was hit on Monday in the central city of Kremenchuk, killing at least 19.

Zelensky denounced the strikes on Friday as “conscious, deliberately targeted Russian terror and not some sort of error or a coincidental missile strike.”

In his nightly television address on Saturday, Zelensky said it would be a “very difficult path” to victory but Ukrainians must maintain their resolve and inflict losses on the “aggressor…  so that every Russian remembers that Ukraine cannot be broken.”

Troops on a break from the fighting in Konstyantynivka, a market town about 115 km west of Lysychansk, said they had managed to keep the supply road to the embattled city open, for now, despite Russian bombardment.

“We still use the road because we have to, but it’s within artillery range of the Russians,” said one soldier as comrades relaxed nearby, munching on sandwiches or eating ice cream.

“The Russian tactic right now is to just shell any building we could locate ourselves at. When they’ve destroyed it, they move on to the next one,” he said.

Despite being battered in the east, Ukrainian forces have made some advances elsewhere, including forcing Russia to withdraw from Snake Island, a Black Sea outcrop southeast of Odesa that Moscow captured at the start of the war.

Russia had used Snake Island to impose a blockade on Ukraine, one of the world’s biggest grain exporters and a major producer of seed for vegetable oils. The disruptions have helped fuel a surge in global grain and food prices.

Russia, also a big grain producer, blames the crisis on Western sanctions hurting its exports. — Reuters

New York bans guns in many public places after Supreme Court ruling

TOM DEF-UNSPLASH

NEW YORK — New York state passed a law on Friday banning guns from many public places, including Times Square, and requiring gun license applicants to prove their shooting proficiency and submit their social media accounts for review by government officials.

The law, passed in an emergency legislative session, was forced by a landmark US Supreme Court ruling last week that struck down New York’s restrictive gun-license laws. The court’s conservative majority ruled for the first time that the US Constitution grants an individual the right to carry weapons in public for self-defense.

New York’s Democratic leaders have decried the ruling and the court, saying there will be more gun violence if there are more people carrying guns.

They conceded they must loosen the state’s century-old permit scheme to comply with the ruling, but sought to keep as many restrictions as they could in the name of public safety. Some will likely be targets for further legal challenges.

The court ruled that New York’s former license regime, which dates from 1911, gave too much discretion to officials to deny a permit.

New York Governor Kathy Hochul, a Democrat who ordered the extraordinary session in the Legislature, said the state’s gun-licensing regulations had resulted in New York having the fifth-lowest rate of gun deaths of the 50 US states.

“Our state will continue to keep New Yorkers safe from harm, even despite this setback from the Supreme Court,” she told a news conference in the state capital, Albany, while lawmakers were debating the bill. “They may think they can change our lives with the stroke of a pen, but we have pens, too.”

The court’s ruling allowed that people could be banned from carrying weapons in certain “sensitive places” but warned lawmakers against applying the label too broadly.

The court also made it easier for pro-gun groups to have a regulation overturned. It ruled that a weapons regulation was likely unconstitutional if it was not similar to the sort of regulations around in the 18th century, when the US Constitution’s Second Amendment was ratified, letting states maintain militias and defining a right to “keep and bear Arms.”

The law passed on Friday makes it a felony crime to carry a gun into a new list of sensitive places, including government buildings, medical facilities, places of worship, libraries, playgrounds, parks, zoos, schools, colleges, summer camps, addiction-support centers, homeless shelters, nursing homes, public transit including the New York City subway, places where alcohol or marijuana is consumed, museums, theaters, stadiums and other venues, polling places and Times Square.

Law enforcement officials and registered security guards are among those exempt from the sensitive-place restrictions.

Republican lawmakers voted against the law, set to take effect on Sept. 1, complaining that it makes the right to carry weapons lesser than other constitutional rights, such as freedom of speech and of religion.

“Now, it’s going to be easier to get a concealed-carry” license, said Mike Lawler, a Republican member of the Assembly, during the debate. “But you’re not going to be able to carry it anywhere.”

‘FLAGRANT VIOLATION’

The National Rifle Association, the powerful gun-owners’ rights group whose local affiliate was the lead plaintiff in the Supreme Court case, called New York’s law a “flagrant violation” of the ruling by creating more barriers to New Yorkers’ self-defense rights, indicating it may soon face legal challenges.

“Gov. Hochul and her anti-Second Amendment allies in Albany have defied the United States Supreme Court with an intentionally malicious rewriting of New York’s concealed carry law,” Darin Hoens, the New York NRA state director, said in a statement.

The court ruled in New York State Rifle & Pistol Association vs Bruen that New York licensing officials had too much subjective discretion over who could enjoy what it said was a constitutional right. Applicants were denied a concealed-carry permit if they could not convince an official they had “proper cause,” or some kind of special reason, for carrying a handgun for self-defense.

Reluctantly and not without protest, Hochul agreed the state must remove the “proper cause” requirements, though the law still requires licensing officers find the applicant is of “good moral character.”

The new licensing rules require applicants to meet with the licensing officer, usually a judge or a police official, for an in-person interview, and provide the contact details of some immediate family members and any adults they live with.

The law makes it a felony to carry a gun into private business premises unless the business affirmatively gives notice that concealed weapons are welcome. — Reuters

Dozens of Russian weapon tycoons have faced no Western sanctions

JAY REMBERT-UNSPLASH

AS RUSSIA’s military continues to pound Ukraine with missiles and other lethal weapons, Western nations have responded in part by targeting Russia’s defense industry with sanctions. The latest round came on Tuesday, when the United States issued new sanctions on some arms makers and executives at the heart of what it dubbed Russian President Vladimir Putin’s “war machine.”

But a Reuters examination of companies, executives and investors underpinning Russia’s defense sector shows a sizable number of players have yet to pay a price: Nearly three dozen leaders of Russian weapon companies and at least 14 defense companies have not been sanctioned by the United States, the European Union (EU) or the United Kingdom. In addition, sanctions on Russia’s arms makers and tycoons have been applied inconsistently by these NATO allies, with some governments levying penalties and others not, the Reuters review showed.

Among the weapons moguls who have not been sanctioned by any of those three authorities is Alan Lushnikov, the largest shareholder of Kalashnikov Concern JSC, the original manufacturer of the well-known AK-47 assault rifle. Mr. Lushnikov owns a 75% stake in the company, according to the most recent business records reviewed by Reuters.

The company itself was sanctioned by the United States in 2014, the year Russia invaded and annexed the Ukrainian peninsula of Crimea. The EU and UK leveled their own sanctions against Kalashnikov Concern this year.

The company accounts for 95% of Russia’s production of machine guns, sniper rifles, pistols and other handheld firearms, and 98% of its handheld military machine guns, according to its website and most recent annual report. Its weapons include the AK-12 assault rifle, an updated version of the AK-47, some of which have been captured from Russian forces by Ukrainian soldiers. The Kalashnikov Concern also produces missiles that can be fired from aircraft or on land.

A former Russian deputy transport minister, Mr. Lushnikov once worked for commody tycoon Gennady Timchenko, a longtime friend of Mr. Putin. The United States sanctioned Mr. Timchenko in 2014 after Russia’s invasion of Crimea, naming him as a member of the Kremlin’s “inner circle.”

Neither Mr. Lushnikov, Mr. Timchenko or the Kalashnikov Concern responded to requests for comment.

It’s the same pattern with Almaz-Antey Concern, a Moscow-based defense company specializing in missiles and anti-aircraft systems. The company has been sanctioned by the United States, EU and UK, but CEO Yan Novikov has not been punished.

Almaz-Antey’s website displays the motto “Peaceful Sky is Our Profession.” The company makes Kalibr missiles, which Russia’s Ministry of Defense has credited with destroying Ukrainian military installations. In a statement last month, the ministry said Russia had fired long-range Kalibr missiles at a Ukrainian command post near the village of Shyroka Dacha in eastern Ukraine, killing what the ministry claimed were more than 50 generals and officers of the Ukrainian military.

Reuters was unable to independently verify that claim.

Neither Almaz-Antey nor CEO Novikov responded to requests for comment.

In response to a list of questions submitted by Reuters about Western sanctions aimed at Russia, a Kremlin spokesperson said: “The consistency and logic of imposing sanctions, as well as the legality of imposing such restrictions, is a question that should be put directly to the countries that introduced them.”

The Reuters findings come as Ukrainian President Volodymyr Zelensky has said that current Western sanctions against Russia “are not enough” as Russian troops make gains in their assault on Ukraine’s eastern regions of Luhansk and Donetsk.

The Ukrainian military has been outgunned by Russian artillery in places such as the industrial city of Sievierodonetsk, which it ceded to Russian forces last week after weeks of intense fighting.

Mr. Putin has portrayed his military’s assault on Ukraine as a “special military operation” aimed at demilitarizing and “denazifying” its democratic neighbor. On Tuesday, Russia’s Foreign Ministry announced it would bar Jill Biden and Ashley Biden, the wife and daughter of US President Joseph Biden, from entering Russia indefinitely in what it said was a response to “constantly expanding US sanctions against Russian politicians and public figures.”

US National Security adviser Jake Sullivan said on Tuesday Russia’s action was not surprising because “the Russian capacity for these kinds of cynical moves is basically bottomless.”

The Russian invasion has killed thousands of Ukrainian soldiers and civilians, but the exact number is unknown. The United Nations human rights office said that as of Monday, 4,731 civilians had been killed in Ukraine since Russia’s invasion began on Feb. 24, including more than 300 children, with another 5,900 civilians injured in the conflict. The agency said most of the casualties were caused by the use of “explosive weapons with a wide impact area, including shelling from heavy artillery and multiple launch rocket systems, and missile and air strikes,” and that the actual number of dead and wounded was likely far higher.

The West has levied sanctions on a swath of Russia’s economy to punish Moscow, an effort that so far has done little to deter the Russian offensive. Like the bans on other Russian firms, sanctions on weapons companies are meant to hamper their ability to sell to foreign customers. These penalties limit their access to imported components and generally make it more costly and time-consuming to produce weaponry. Levying sanctions on the people behind those firms goes a step further to make the pain personal. It allows Western nations to go after any mansions, yachts and other offshore wealth of those who supply Russia’s military, and it limits where they can travel abroad.

“You’re demonstrating that being a regime collaborator comes with a cost,” said Max Bergmann, a former State Department official during the Obama administration who worked on US arms transfers and safeguarding US military technology. “They feel it very personally. You’re creating a disgruntled class of people that are tied to the Kremlin,” said Mr. Bergmann, now director of the Europe program at the Center for Strategic and International Studies, a Washington-based national security think tank.

AMMUNITION MAKERS
Other companies in Russia’s defense industry identified by Reuters that have not been sanctioned by the United States, EU or UK include the V.A. Degtyarev Plant, a facility 165 miles northeast of Moscow that makes machine guns, anti-tank and anti-aircraft weapons that are sold to the Russian military. Its weapons include the Kalashnikov PKM and PKTM machine guns, as well as Kord rifles and machine guns, some of which are mounted on armored vehicles.

The Degtyarev Plant did not respond to a request for comment.

Also not sanctioned is the Klimovsk Specialized Ammunition Plant, south of Moscow, where “world-famous cartridges” for pistols and Kalashnikov assault rifles are produced, according to an archived version of its website. Neither is the Novosibirsk Cartridge Plant, an ammunition manufacturer that calls itself “one of the leading engineering enterprises of the military-industrial complex of Russia.”

Neither ammunition plant responded to requests for comment.

Last month, Reuters sought comments from sanctions officials in the UK, EU and United States regarding the news agency’s findings that they had failed to punish a raft of Russian defense firms and tycoons fueling Mr. Putin’s war effort. As part of that process, Reuters provided those Western authorities with a detailed list of more than 20 companies and more than three-dozen people that had escaped sanctions.

The UK’s Foreign, Commonwealth and Development Office, which levies sanctions for Britain, said it could not comment on future sanctions. It added that London and its allies had levied “the largest and most severe economic sanctions that Russia has ever faced, to help cripple Putin’s war machine.” The European Commission and the US Treasury Department, which handle sanctions for Brussels and Washington respectively, declined to comment on the specifics of Reuters’ findings. Elizabeth Rosenberg, assistant secretary for terrorist financing and financial crimes at the Treasury Department, said in a statement that sanctions have “made it harder for Russia to obtain what it needs to procure and produce weapons.”

On Tuesday, in conjunction with a meeting of leaders of the G7 nations in the German Alps, the Treasury Department released a new round of defense-related sanctions that included eight of the weapons firms and two of the executives on the list provided earlier by Reuters.

One of those newly sanctioned executives, Vladimir Artyakov, has played key roles in Russia’s weapons industry for decades, and serves as the No. 2 executive at Rostec, a military-industrial giant with hundreds of subsidiaries employing more than half a million people, according to its website and annual reports. Mr. Artyakov is also the chairman of at least five Russian weapons firms, among them Russian Helicopters JSC, which builds several lines of military helicopters including the Ka-52 “Alligator,” some of which have been shot down and documented in Ukraine.

He has not been sanctioned by the EU or UK. Mr. Artyakov and Russian Helicopters did not respond to requests for comment.

Rostec has been sanctioned by Washington since 2014. On Tuesday the United States targeted the company again, levying sanctions on more than 40 Rostec subsidiaries and affiliates. Among those hit was Avtomatika Concern, a company linked to cyber warfare. It was on the list of Russian defense firms that Reuters had submitted to the Treasury Department last month seeking an explanation as to why the companies had not been sanctioned.

Rostec and Avtomatika Concern did not respond to requests for comment.

Other firms on Reuters’ list that were sanctioned just this week by the Treasury Department include PJSC Tupolev, a maker of fighter jets such as the Tu-22M3 bomber. The Ukrainian military said Tu-22M3 bombers were responsible for a missile strike at a crowded shopping center in the central Ukrainian city of Kremenchuk on Monday, which killed at least 18 people and injured about 60.

PJSC Tupolev and another firm on Reuters’ list, JSC VNII Signal, have not been sanctioned by the EU or UK. JSC VNII Signal is a producer of mechanical and navigational systems that power Russian military tanks and some of the country’s most advanced missile systems.

PJSC Tupolev and JSC VNII Signal did not respond to requests for comment.

TOP BRASS
Executives at a host of Russian weapon companies, meanwhile, have largely escaped sanctions from Western authorities.

Nearly three months after a Tochka-U ballistic missile hit a train station in the eastern Ukrainian city of Kramatorsk on April 8, Russian weapons executives linked to the company that makes those missiles have yet to pay a price. The strike killed more than 50 people, including children, and injured more than 100 others.

The Russian firm JSC Research and Production Corporation Konstruktorskoye Byuro Mashynostroyeniya, known as KBM, has been the primary manufacturer of Tochka-U missiles, according to a US Army database of worldwide military equipment. Neither Washington, Brussels or London have sanctioned Sergey Pitikov, KBM’s chief executive.

The three Western allies have likewise spared Alexander Denisov, the CEO of NPO High Precision Systems, KBM’s parent company. High Precision Systems oversees production of a wide range of missiles, artillery, grenade launchers and machine guns used by Russian troops and outfitted on military helicopters, aircraft, tanks and warships.

Sanctions on Russia’s arms companies and tycoons have been applied inconsistently by the Western allies. The United States and EU have sanctioned High Precision Systems, for example, while the UK has not. The United States has sanctioned KBM, but the EU and UK have not.

High Precision Systems, Pitikov and Denisov did not respond to requests for comment. KBM confirmed that Pitikov is its chief executive, but did not respond to additional questions submitted by Reuters.

Europe and the United States have failed to coordinate sanctions even on makers of banned weapons.

Since the outset of Russia’s invasion in late February, Western governments and human rights groups have decried its use of cluster munitions: small bombs delivered by missiles or rockets, which scatter and explode over an area as large as a city block. A 2008 international treaty bans their use or production under any circumstances because of the devastating effects on civilians.

Russia used a Uragan — which translates to “Hurricane” — rocket launcher system to fire cluster bombs in Kharkiv on March 24, killing eight civilians and injuring 15 others, according to the UN human rights office and Ukrainian officials.

The Uragan is made by JSC Scientific and Production Association Splav, a Russian firm whose systems have been sold abroad to countries including India. The company has been sanctioned by the United States, but not by the UK or EU. Its CEO, Alexander Smirnov, has escaped sanctions altogether.

Splav and Smirnov did not respond to requests for comment.

It’s much the same for Splav’s parent company, NPK Techmash. The United States and the EU have sanctioned the firm, but the UK has not. Techmash CEO Alexander Kochkin has not been targeted by American or European authorities.

Techmash and Kochkin did not respond to requests for comment.

In a June 10 statement, the European Commission said there is an effort to align sanctions lists “as much as legally possible” among allies to achieve “the maximum cumulative effect of the sanctions with all our like-minded partners.” In cases where the lists do not align, the Commission statement said, people and companies not currently on the EU’s sanctions list could be added later if there is sufficient evidence.

“Nothing is off the table,” the statement said.

WESTERN CONNECTIONS
One of the highest-profile Russian firms to escape Western sanctions is VSMPO-Avisma Corp., which is the world’s largest titanium supplier and 25% owned by Rostec. It supplies Russia’s defense industry, but also counts major Western aerospace companies among its clients.

Based in Verkhnyaya Salda, in central Russia, VSMPO-Avisma has subsidiaries with facilities in the United States, Switzerland and the UK, as well as sales and distribution staff in the United States, Europe and Asia, according to its website and annual reports. That’s no doubt a factor that has allowed the company to escape punishment, according to three sanctions and Russian defense experts who spoke with Reuters.

VSMPO-Avisma’s vice chairman and majority shareholder, Russian billionaire Mikhail Shelkov, ranked by Forbes this year as Russia’s 59th-richest person, likewise has not been sanctioned.

According to past press releases, VSMPO-Avisma has long-term contracts to supply titanium to United Aircraft Corp, a Rostec subsidiary that oversees production of Russian fighter jets such as the Su-34 that have been shot down in Ukraine. United Aircraft has been sanctioned by the United States, EU and UK.

VSMPO-Avisma also sells to Europe’s Airbus, and it supplied US aerospace behemoth Boeing Co. up until March, when the Arlington, Virginia-based company said it stopped purchasing titanium from Russia. Boeing had announced just months earlier, in November 2021, that VSMPO-Avisma would be its largest titanium supplier “for current and future Boeing commercial airplanes.”

VSMPO-Avisma and shareholder Shelkov declined to comment. Boeing said in a statement that it has worked since 2014 to diversify its sources of titanium around the world, and that its current inventory and sources “provide sufficient supply for airplane production.”

Airbus did not answer specific questions about its relationship with VSMPO-Avisma. But in an emailed statement it said potential sanctions on Russian titanium “would massively damage the entire aerospace industry in Europe” while doing little to harm Russia because those sales are but a small portion of that nation’s overall exports.

In 2020, foreign sales accounted for about two-thirds of VSMPO-Avisma’s $1.25 billion in revenue, according to the company’s most recent annual report.

That puts Western officials in a tough spot, said Richard Connolly, director of Eastern Advisory Group, a UK consultancy that advises governments and businesses on the Russian economy and its defense industry. Slapping sanctions on VSMPO-Avisma would curtail its lucrative export trade, but it would also force major players in global aviation to switch suppliers or risk sanctions themselves.

“That’s the classic sanctions conundrum: If you want to hurt somebody, you’re going to hurt yourself,” Mr. Connolly said. — Reuters

Environment protection spending dips by 4.6% in 2021 — PSA

REUTERS

Expenditures for environmental protection declined by 4.6% year on year in 2021, data from the Philippine Statistics Authority (PSA) showed.

The statistics agency’s Compendium of Philippine Environment Statistics (CPES) Component 6 showed annual government environmental protection expenditures went down to P25.4 billion last year from P26.6 billion in 2020.

The CPES, an adoption of the United Nations-developed Framework for the Development of Environment Statistics, is a compilation of statistical data gathered from different government agencies. It consists of data on expenditures, regulations, and other activities such as international agreements focusing on the protection of the environment and management of resources.

Expenditures for the protection of biodiversity and landscape rose by 9.7% last year to P11.5 billion. It accounted for 45.1% of the total expenditures for environmental protection.

This was followed by environmental protection not elsewhere classified with P6.5 billion, or 25.7% of the total expenditures. Compared to 2020, expenditures allocated for this sector declined by 4.8%.

Expenditures for waste management, on the other hand, reached P3.3 billion, 13% of the total expenditures. Allocation for this sector was lower by 13.7% in 2021 from the P3.8 billion in 2020.

Meanwhile, spending on pollution abatement amounted to P2.8 billion, while research and development environment protection outlays reached P1.2 billion. These accounted for 11% and 4.9%, respectively, of the total environment protection spending in 2021.

Wastewater management had the lowest share in environmental protection outlays with 0.3% or a total of P80 million. This declined by 96.3% from P2.2 billion in 2020.

CPES also showed the Department of Environment and Natural Resources had an annual budget of almost P18 billion in 2021, 4.8% lower than the budget allocated in 2020.

Number of staff or positions per plantilla showed that there were 16,379 staff positions in 2021, slightly higher compared with the 16,354 in 2020.

INTEREST UP AMONG YOUTH

Meanwhile, among the programs under the Philippine Standard Classification of Education, environmental science logged the highest number of enrolled students in the country, with 57,876, followed by forestry (57,073), and environmental planning/management (14,080).

Other programs included environmental and sanitary engineering with 10,624 enrolled students; environment and natural resources management (1,735); environmental education (115); and natural resources conservation (7).

Figures are based on the submission of higher education institutions, which includes pre-baccalaureate up to doctoral programs to the Commission on Higher Education.

Budget allocation for environmental education last year amounted to P1.90 million, 1.8% higher than P1.86 million in 2020.

CLIMATE CHANGE SPENDING DOWN

The CPES also provided data on the climate change expenditures by National Climate Change Action Plan (NCCAP). Total climate change expenditures amounted to P181.9 billion with adaptation at P173.6 billion and mitigation at P8.3 billion.

Expenditures for climate change declined by 21.9% last year from P232.8 billion previously.

Broken down, NCCAP’s strategic priorities showed water sufficiency had the highest expenditure with a total of P132.3 billion, 8.3% lower than the P144.3 billion in the prior year.

This was followed by food security with P22.4 billion; sustainable energy (P12.4 billion); ecosystem and environmental stability (P10.4 billion); climate smart industries and services (P2.7 billion); knowledge and capacity development (P881.9 million); human security (P693.8 million); and cross-cutting (P28 million).

The PSA noted that for the current CPES Component 6, 18 statistics were compiled out of the 50 identified indicators. — Abigail Marie P. Yraola

In Hong Kong, Xi says ‘one country, two systems’ is here to stay

LOK YIU CHEUNG-UNSPLASH

HONG KONG — There is no reason to change Hong Kong’s “one country, two systems” formula of governance, Chinese President Xi Jinping said on a rare visit to the global financial hub after swearing in the city’s new leader, John Lee, on Friday. 

Britain returned Hong Kong to Chinese rule on July 1, 1997, with Beijing promising wide-ranging autonomy, unfettered individual rights and judicial independence at least until 2047. 

China’s critics accuse authorities of trampling on those freedoms, unavailable on the authoritarian mainland, with a sweeping national security law imposed by Beijing on the city in 2020 after mass pro-democracy protests the year before. 

British Prime Minister Boris Johnson and US Secretary of State Antony Blinken said on Thursday that China had failed to meet its handover commitments. 

China and Hong Kong reject the accusations, saying the law “restored order from chaos” so that the city could prosper. 

Mr. Xi said the “one country, two systems” formula was successful under China’s “comprehensive jurisdiction.” 

“For this kind of good system, there is no reason at all to change it. It must be maintained over the long term,” Mr. Xi said. 

“After experiencing wind and rain, everyone can painfully feel that Hong Kong cannot be chaotic, and must not become chaotic again … Hong Kong’s development cannot be delayed again, and any interference must be eliminated.” 

Mr. Xi added China would support Hong Kong’s role as an international finance and trade hub. 

At the swearing-in ceremonies, all officials, including Mr. Xi, wore masks and did not shake hands. 

Former police officer Mr. Lee, sanctioned by Washington over his role in implementing the security law, takes charge as the city is facing an exodus of people and talent amid some of the toughest coronavirus disease 2019 (COVID-19) restrictions in the world. 

Authorities deployed a massive security force, blocking roads and the airspace around the picturesque Victoria Harbour, where the last colonial governor, Chris Patten, tearfully handed Hong Kong back to China at a rain-drenched ceremony in 1997. 

Red lanterns, Chinese and Hong Kong flags, and posters declaring a “new era” of stability decorated districts across the city. 

Mr. Xi did not attend the traditional flag-raising ceremonies on Friday, with media reporting he stayed overnight across the border in Shenzhen after arriving in Hong Kong on Thursday. 

Mr. Xi’s visit to Hong Kong is his first since 2017, when he swore in outgoing leader Carrie Lam and stayed in the city for the duration of his trip. His overnight whereabouts this time, and the reasons why he may have chosen Shenzhen, have not been officially confirmed. 

Hong Kong recorded more than 2,000 daily COVID cases on Thursday, levels which would prompt tight restrictions in any mainland city. China is alone among major countries in choosing to eliminate outbreaks as soon as they occur, at all costs. 

‘GREAT REJUVENATION’ 

Some analysts see Mr. Xi’s visit as a victory tour after Beijing tightened its control of Hong Kong. After arriving in the city on Thursday, Mr. Xi said the city had overcome its challenges and “risen from the ashes.”

“What happened over the past 25 years has proven that the future and destiny of Hong Kong must be in the hands of the patriots who would cry proudly for being Chinese,” nationalist tabloid Global Times, published by the Communist Party’s official People’s Daily, wrote in an editorial. “The great rejuvenation of the Chinese nation is irreversible and Hong Kong’s tomorrow will be even brighter.” 

The handover anniversary has traditionally seen thousands march to voice grievances over everything from sky-high property prices to Beijing’s grip over the city, including during Mr. Xi’s last trip to Hong Kong. 

On July 1, 2019, during the anti-government protests, demonstrators stormed and ransacked the city’s legislature. 

No protests are taking place this time, with the most outspoken opposition politicians and democracy activists either in jail or self-exile. 

“It is the end of an era, it is the end of ‘one country, two systems,” exiled Hong Kong activist Samuel Chu told Reuters from Oslo, Norway. “This is a city that is no longer recognizable.” — Meg Shen and James Pomfret/Reuters

Indonesia leader targets food crisis during Russia-Ukraine peace mission

REUTERS

Indonesia’s president ended a trip to Ukraine and Russia saying he hoped for progress reintegrating global food and fertilizer supply lines disrupted by the conflict, and offered to be a diplomatic bridge between the two nations.

President Joko Widodo, who is the Group of 20 (G20) president this year, was speaking at a news conference alongside his Russian counterpart Vladimir Putin after a bilateral meeting in Moscow on Thursday.

His trip followed a visit to Kyiv on Wednesday where he met with Ukrainian President Volodymyr Zelenskyy.

“I really appreciate President Putin who said earlier that he will provide security guarantee for food and fertilizer supplies from both Russia and Ukraine. This is good news,” said the Indonesian president, who is widely known as Jokowi.

“For the sake of humanity, I also support the United Nations’ efforts to reintegrate Russian food and fertilizer commodities and Ukrainian food commodities to re-enter the world supply chain,” he said.

Jokowi said he had urged leaders of the Group of Seven (G7) during a meeting he attended in Germany this week to ensure sanctions on Russia did not affect food and fertilizer supplies.

The war in Ukraine has caused major disruptions to global trade, with the prices of grain and wheat soaring amid a blockade of Ukrainian seaports and sanctions on Russian commodities such as oil, gas and fertiliser.

Speaking alongside Jokowi in Moscow, President Putin denied Russia was blocking Ukrainian grain exports.

“The Ukrainian military has mined the approaches to their ports,” he said, “No one prevents them from clearing those mines and we guarantee the safety of shipping grain out of there.”

As G20 president this year, Jokowi has sought to patch up divisions in the group exposed by the war in Ukraine and threats to boycott the summit if Russia attended, as well as leveraging his country’s non-aligned position to push for peace.

On Thursday, he said he had conveyed a message from Mr. Zelenskyy to Putin, and said Indonesia remained willing to be a “communication bridge” between the two leaders. He did not say what was in the message.

Separately, Indonesian Foreign Minister Retno Marsudi said she had held phone calls with UN Secretary-General Antonio Guterres, and the head of the International Committee of the Red Cross, among others, about the food crisis and possible ways to re-integrate Ukraine and Russia into the global food chain. — Reuters

Asia’s factories feeble despite China bounce, feeds global recession fears

REUTERS

TOKYO — Asia’s manufacturing activity stalled in June as many companies were hit by supply disruptions caused by China’s strict coronavirus disease 2019 (COVID-19) lockdowns, while sharp economic slowdown risks in Europe and the United States reinforced fears of a global recession. 

A string of surveys on Friday showed China’s factory activity bouncing solidly in June though a slowdown in Japan and South Korea, as well as a contraction in Taiwan, highlighted the strain from supply disruptions, rising costs and persistent material shortages. 

China’s manufacturing activity expanded at its fastest in 13 months in June, a private survey showed, as the lifting of COVID-19 lockdowns sent factories racing to meet solid demand. 

The roll-backs of China’s lockdowns could ease supply chain snags, and allow automakers and other manufacturers to resume operations after suffering severe disruptions. 

Some analysts, however, warn of fresh headwinds such as growing market fears that aggressive US interest rate hikes to tamp down soaring inflation will push the country into recession, and weigh on overall global demand. 

Policy tightening across many other economies amid red-hot consumer price pressures have stoked fears of a sharp global economic downturn and shaken financial markets in recent months. 

“There’s hope that China’s economy will pick up after a period of some weakness. But now there’s a risk of slowdown in the US and European economies,” said Yoshiki Shinke, chief economist at Japan’s Dai-ichi Life Research Institute. 

“It will be a tug-of-war between the two, though there’s a lot of uncertainty over the global economic outlook.” 

The final au Jibun Bank Japan Manufacturing purchasing managers’ index (PMI) slipped to 52.7 in June from 53.3 in the previous month, staying above the 50-mark separating contraction from expansion. 

South Korea’s S&P Global PMI also fell to 51.3 in June from 51.8 in May, dropping for a second month due to the drag from supply constraints and a truckers’ strike in June. 

Separate data showed South Korean exports, seen as a proxy for global trade because the nation’s manufacturers are positioned in many parts of the world supply chain, growing at their slowest pace in 19 months in June. 

On the brighter side, China’s Caixin/Markit manufacturing PMI rose to 51.7 in June from 48.1 in the previous month, marking the first expansion in four months. That was well above analysts’ expectations for an up-tick to 50.1. 

The Caixin survey, which focused on more export-oriented and small firms in coastal regions, follows official data showing the country’s factory and service sectors snapped three months of activity decline in June. 

Taiwan’s S&P global PMI fell to 49.8 in June from 50.0 in May, while that of Vietnam was down to 54.0 in June from 54.7 in the previous month. 

Lockdowns in China have snarled regional and global logistics and supply chains, with both Japan and South Korea reporting sharp declines in output. 

China’s economy has started to chart a recovery path out of the supply shocks caused by strict lockdowns, though risks remain such as soft consumer spending and fear of a fresh wave of infections. — Leika Kihara/Reuters

EU says it may not be possible to cross finish line on Iran nuclear deal

Image via Rikard Fröberg/Flickr/CC BY 2.0

UNITED NATIONS — Senior Western officials voiced doubts about reviving the 2015 Iran nuclear deal on Thursday, with the European Union (EU) saying it “might not make it over the finishing line” and a US official saying the odds had lengthened after this week’s failed talks.

The UN Security Council met to discuss Iran one day after indirect US-Iran talks ended in Doha with no sign of progress on resurrecting the pact under which Tehran limited its nuclear program in return for relief from US, UN and EU sanctions.

“I am concerned that we might not make it over the finishing line. My message is: Seize this opportunity to conclude the deal, based on the text that is on the table,” European Union Ambassador to the United Nations Olof Skoog said.

The EU coordinates the talks on resurrecting the agreement, which then US President Donald J. Trump reneged on in 2018 and restored harsh US sanctions on Iran, prompting Tehran to start violating its nuclear restrictions about a year later.

“The prospects for a deal after Doha are worse than they were before Doha and they will be getting worse by the day,” the senior US official told Reuters on condition of anonymity.

“You could describe Doha at best as treading water, at worst as moving backwards. But at this point treading water is for all practical purposes moving backwards,” he added.

The Security Council met to discuss the latest report by UN Secretary-General Antonio Guterres on the implementation of a 2015 council resolution that enshrines the nuclear deal, formally called the Joint Comprehensive Plan of Action (JCPOA).

US, British, and French diplomats all placed the onus on Iran for the failure to revive the agreement after more than a year of negotiations.

Iran “should urgently take this deal — there will not be a better one,” Britain’s UN Ambassador Barbara Woodward said.

“Iran has yet to demonstrate any real urgency to conclude a deal, end the current nuclear crisis and achieve important sanctions lifting,” Richard Mills, Deputy US Ambassador to the United Nations, told the meeting.

“Not only has Iran not taken up the offer on the table, but it also added yet more issues which fall outside the JCPOA with maximalist and unrealistic demands,” French UN Ambassador Nicolas de Riviere said.

Iran, however, described the latest talks as “serious and positive” and said it was ready to strike an agreement.

“Iran has demanded verifiable and objective guarantees from the US that JCPOA will not be torpedoed again, that the US will not violate its obligations again, and that sanctions will not be re-imposed under other pretexts or designations,” Iran’s UN Ambassador Majid Takht Ravanchi told the council.

The senior US official disputed Tehran’s argument that Washington was to blame for the lack of progress, saying the United States had responded positively to proposed EU changes to the draft text of an agreement reached in wider talks in March while Iran had failed to respond to those proposals.

“Their vague demands, reopening of settled issues, and requests clearly unrelated to the JCPOA all suggests to us … that the real discussion that has to take place is (not) between Iran and the US to resolve remaining differences. It is between Iran and Iran ,” the senior US official said.

“At this point, we are not sure if they (the Iranians) know what more they want. They didn’t come to Doha with many specifics,” he added.

However, Chinese and Russian diplomats faulted the United States, with Beijing’s representative urging Washington to ease unilateral US sanctions on Iran and Russia’s calling for all sides to show flexibility. — Arshad Mohammed and Michelle Nichols/Reuters

Meta slashes hiring plans, girds for ‘fierce’ headwinds

DESIGN.FACEBOOK.COM

Facebook-owner Meta Platforms Inc. has cut plans to hire engineers by at least 30% this year, Chief Executive Officer Mark Zuckerberg told employees on Thursday, as he warned them to brace for a deep economic downturn. 

“If I had to bet, I’d say that this might be one of the worst downturns that we’ve seen in recent history,” Mr. Zuckerberg told workers in a weekly employee Q&A session, audio of which was heard by Reuters. 

Meta has reduced its target for hiring engineers in 2022 to around 6,000–7,000, down from an initial plan to hire about 10,000 new engineers, Mr. Zuckerberg said. 

Meta confirmed hiring pauses in broad terms last month, but exact figures have not previously been reported. 

In addition to reducing hiring, he said, the company was leaving certain positions unfilled in response to attrition and “turning up the heat” on performance management to weed out staffers unable to meet more aggressive goals. 

“Realistically, there are probably a bunch of people at the company who shouldn’t be here,” Mr. Zuckerberg said. 

“Part of my hope by raising expectations and having more aggressive goals, and just kind of turning up the heat a little bit, is that I think some of you might decide that this place isn’t for you, and that self-selection is OK with me,” he said. 

The social media and technology company is bracing for a leaner second half of the year, as it copes with macroeconomic pressures and data privacy hits to its ads business, according to an internal memo seen by Reuters on Thursday. 

The company must “prioritize more ruthlessly” and “operate leaner, meaner, better executing teams,” Chief Product Officer Chris Cox wrote in the memo, which appeared on the company’s internal discussion forum Workplace before the Q&A. 

“I have to underscore that we are in serious times here and the headwinds are fierce. We need to execute flawlessly in an environment of slower growth, where teams should not expect vast influxes of new engineers and budgets,” Mr. Cox wrote. 

The memo was “intended to build on what we’ve already said publicly in earnings about the challenges we face and the opportunities we have, where we’re putting more of our energy toward addressing,” a Meta spokesperson said in a statement. 

The guidance is the latest rough forecast to come from Meta executives, who already moved to trim costs across much of the company this year in the face of slowing ad sales and user growth. 

Tech companies across the board have scaled back their ambitions in anticipation of a possible US recession, although the slide in stock price at Meta has been more severe than at competitors Apple and Google. 

The world’s biggest social media company lost about half its market value this year, after Meta reported that daily active users on its flagship Facebook app had experienced a quarterly decline for the first time. 

Its austerity drive comes at a tricky time, coinciding with two major strategic pivots: one aimed at re-fashioning its social media products around “discovery” to beat back competition from short-video app TikTok, the other an expensive long-term bet on augmented and virtual reality technology. 

In his memo, Mr. Cox said Meta would need to increase fivefold the number of graphic processing units (GPUs) in its data centers by the end of the year to support the “discovery” push, which requires extra computing power for artificial intelligence to surface popular posts from across Facebook and Instagram in users’ feeds. 

Interest in Meta’s TikTok-style short video product Reels was growing quickly, said Mr. Cox, with users doubling the amount of time they were spending on Reels year over year, both in the United States and globally. 

Some 80% of the growth since March came from Facebook, he added. 

That user engagement with Reels could provide a key route to bolster the bottom line, making it important to boost ads in Reels “as quickly as possible,” he added. 

Mr. Zuckerberg told investors in April that executives viewed Reels as “a major part of the discovery engine vision,” but at the time described the short video shift as a “short-term headwind” that would increase revenue gradually as advertisers became more comfortable with the format. 

Mr. Cox said Meta also saw possibilities for revenue growth in business messaging and in-app shopping tools, the latter of which, he added, could “mitigate signal loss” created by Apple-led privacy changes. 

He said the company’s hardware division was “laser-focused” on successfully launching its mixed-reality headset, code-named “Cambria,” in the second half of the year. — Katie Paul/Reuters

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