November 15, 2019
U.S. Official Says First-Phase China Trade Talks in Final Stages
“White House economic adviser Larry Kudlow said negotiations over the first phase of a trade agreement with China were coming down to the final stages, with the two sides in close, regular contact including a call planned for Friday. Speaking after an event at the Council on Foreign Relations late Thursday in Washington, Kudlow told reporters that a deal was close though “not done yet.” President Donald Trump’s top trade advisers met on Thursday evening to discuss the China talks, said Kudlow, who heads Trump’s National Economic Council. “We are coming down to the short strokes,” Kudlow said. “We are in communication with them every single day right now.” Speaking on Fox Business Network on Friday, U.S. Commerce Secretary Wilbur Ross confirmed the two sides are talking today. He said there will be a deal “in all likelihood,” adding that “the devil is always in the details and we’re down to the last details now. Speaking on Fox Business Network on Friday, U.S. Commerce Secretary Wilbur Ross confirmed the two sides are talking today. He said there will be a deal “in all likelihood,” adding that “the devil is always in the details and we’re down to the last details now.” The two sides have held working-level video conferences in recent days focused on issues ranging from the details and time line of Chinese purchases of U.S. agricultural goods such as pork and soybeans to commitments to curtail theft of intellectual property that Trump is demanding from China, according to people familiar with the discussions. A U.S. demand that China spell out how it plans to reach as much as $50 billion in agricultural imports annually has been one sticking point as have discussions over what action the U.S. will take to roll back tariffs in return for a phase one deal, people familiar said. China has reiterated its position that removing existing tariffs is a precondition of reaching a deal. Still, both sides have sent signals that they are intent on an agreement. China has resumed significant purchases of U.S. farm exports since Trump first announced plans for the phase one deal Oct. 11. On Thursday, Beijing also lifted a ban on American poultry that began in 2015, after the U.S. Department of Agriculture made a similar decision to allow Chinese poultry into the U.S.”
Germany Sticks to Debt-Free Budget
“Germany will maintain its disciplined approach to spending as lawmakers look set to confirm the government’s balanced budget for 2020, despite calls for fiscal stimulus to boost the country’s slowing economy. After all-night discussions, the budget committee of the lower house of parliament signed off on plans to spend 362 billion euros ($399 billion) next year, a slight increase from the proposed 360 billion euros, according to documents from the committee. The bill will go to the floor of the legislature in the week starting Nov. 25. “It remains: no new debt,” Eckhardt Rehberg, the budget expert for Chancellor Angela Merkel’s CDU party, said in an emailed statement on Friday. “Germany has no financing problem. We have the necessary income to finance the right priorities: climate protection, internal and external security, education and research, and social security.” While Germany dodged a technical recession in the third quarter by eeking out an unexpected 0.1% expansion, growth remains anemic. The country has determinedly rejected calls to boost spending even though negative interest rates provide an incentive to raise debt. At a Bloomberg News event in Berlin on Thursday, Finance Minister Olaf Scholz said Germany would be prepared to carry out “timely and targeted” measures, such as expanding support for unemployed people, in the event of a crisis — but there isn’t one. Separately, Der Spiegel magazine reported Friday that the federal government’s budget surplus will be just less than 10 billion euros this year, boosted by stronger-than-expected tax revenue and favorable interest rates. The magazine cited preliminary finance ministry estimates. A ministry spokeswoman declined to comment.”
China Regulator Approves Plan to Overhaul Share Ownership
“China’s stock regulators say they will remove a limit on the public float of mainland companies listed in Hong Kong — a change that would shake up the ownership structures of some of the nation’s biggest firms. The China Securities Regulatory Commission said in a statement on Friday evening that qualified companies listed or planning an initial public offering in the city can apply for “full circulation” of their shares. The change requires regulatory approval, it added. Chinese regulators have been preparing to expand a pilot allowing mainland firms listed in the former British colony to convert their non-tradeable shares to H-shares and trade them on the city’s stock exchange. The program has been seen as a key step for state investors to reduce their control or even exit some industries. “Full-circulation is relatively a good thing for investors as it could improve liquidity for these stocks,” said Steven Leung, executive director at Uob Kay Hian (Hong Kong) Ltd. “However, if there is sharp increase in tradeable shares, it would raise investor concern over the impact on the market.” The CSRC said in its Friday statement that it successfully conducted a pilot involving three companies in 2018. Some of China’s biggest and most-high profile firms trade in Hong Kong, including its big four banks, oil giants and insurers.”
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