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Asian markets tumble as Trump’s tariff war escalates

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Asian shares slid on Monday morning after US President Donald Trump followed through on his promise to impose tariffs on Canada, Mexico and China.

Investors are bracing for a turbulent period that could hit the earnings of major companies and dent global growth.

Canada and Mexico have said that they will hit back with retaliatory tariffs while China promised “corresponding countermeasures” and vowed to challenge Trump’s move at the World Trade Organization.

Trump has said the tariffs are necessary to halt the flow of illegal drugs and immigration into the US.

Hong Kong’s Hang Seng Index was down 0.7%, Japan’s Nikkei 225 was 2.8% lower, South Korea’s Kospi tumbled 3% and Australia’s ASX 200 fell 1.9%.

Markets in mainland China remained closed for the Lunar New Year holiday.

Meanwhile, the US dollar was showing strength, rising to a record high against China’s yuan, while the Canadian dollar plunged to its lowest level since 2003.

“The prospect of having a long and protracted trade spat between the world’s two biggest economies is causing investors to take risk off the table today,” said Tim Waterer, chief market analyst at financial services firm KCM Trade.

“The other worry for investors is which countries may be on Trump’s tariff hit list next”.

The tariffs announced by the Trump administration over the weekend target the United States’ three largest trading partners and the US president has threatened he might not stop there.

Trump has also vowed to impose tariffs on the European Union “pretty soon”.

Chief investment strategist at investment bank Saxo, Charu Chanana, warned that while tariffs could be beneficial for the US economy in the short term, in the long run they pose significant risks.

“Repeated use of tariffs would incentivise other countries to reduce reliance on the US, weakening the dollar’s global role,” she added.

Trump has said he will speak to Canada and Mexico’s leaders on Monday about the tariffs which are due to come into effect at midnight on Tuesday.

The two countries are facing tariffs of 25% on their exports to the US, while Chinese goods will face an additional 10% tax.

(BBC News)

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Pakistan militants attack train carrying hundreds of passengers

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A train carrying hundreds of passengers has been attacked and halted by armed militants in Pakistan’s Balochistan region.

The Baloch Liberation Army (BLA) confirmed it had attacked the Jaffar Express Train which was travelling from Quetta to Peshawar.

A statement from the separatist group said it had bombed the track before storming the train in remote Sibi district. It claimed the train was under its control.

Pakistani police told local reporters that they had received information that three people, including the train driver, had been injured in the attack.

Police added that security forces had been sent to the scene of the attack.

A Balochistan government spokesman told local newspaper Dawn that there were reports of “intense firing” at the train.

The BLA claims that it is holding a number of passengers including security officers hostage, and has warned of “severe consequences” if an attempt is made to rescue those it is holding.

However, officials have not yet confirmed that anyone is being held hostage.

Quetta’s railway controller Muhammad Kashif told the BBC that 400-450 passengers had been booked on the train but said they had no independent verification that anyone had been taken hostage.

A senior police official from the area bordering Sibi said “the train remains stuck just before a tunnel surrounded by mountains”, AFP news agency reports.

Meanwhile the country’s interior minister Mohsin Nawaz has condemned the attack and said he prayed for the speedy recovery of those injured.

Officials are yet to communicate with anyone on the train.

The area the express is stopped in has no internet and mobile network coverage, officials told the BBC.

Balochistan is Pakistan’s largest province and the richest in terms of natural resources, but it is the least developed. The Baloch Liberation Army has waged a decades-long insurgency to gain independence and has launched numerous deadly attacks, often targeting police stations, railway lines and highways.

(BBC News)

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Hundreds of flights cancelled as strikes hit German airports

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Hundreds of flights have been cancelled across Germany as airport workers stage a nationwide strike over pay, posing a major disruption for air travellers.

The industrial action, led by the trade union Verdi, began unexpectedly on Sunday at Hamburg Airport, before expanding to a nationwide strike.

Passengers at Frankfurt, Munich, Berlin and other major hubs have been urged not to travel to airports, with operations severely disrupted. Frankfurt, Germany’s busiest airport, said passengers would be unable to board flights and transfer would “almost certainly” be affected.

Verdi, which represents public sector and transport workers, is in an ongoing dispute over wages and working conditions.

German media reports thousands of flights could be cancelled across the day, disrupting travel for more than 500,000 passengers.

The Lufthansa group, whose main hub is in Frankfurt, confirmed “delays and extensive cancellations” across all its airlines.

Meanwhile, Munich Airport warned of a “greatly reduced flight schedule”. This includes flights by Eurowings, Austrian Airlines and Swiss Air.

Katja Bromm, spokeswoman for Hamburg Airport, where all 143 departures scheduled on Monday have already been cancelled, said Verdi was “dishonourable” to call a strike without notice at the start of the holiday season.

She said that Sunday’s walkouts were “excessive and unfair to tens of thousands of travellers who have nothing to do with the disputes”.

A spokesman for Verdi accepted that the strike would affect many, but said the travel disruption was necessary to extracting a better pay offer.

Lars Stubbe, the union’s Hamburg representative, told the BBC: “The workers are aware that disruptions do happen, and they are uncomfortable with that, but in any case, it is the employer that caused these strikes because they haven’t put a negotiable offer on the table.”

Many of Frankfurt Airport’s 1,770 scheduled flights have already been cancelled, while the majority of Munich’s 820 flights are expected to be cancelled.

Hundreds more cancellations are anticipated across Stuttgart, Dusseldorf, Cologne and Berlin.

Many passengers had already checked in their luggage and were having problems getting it returned, according to public broadcaster NDR.

ADV, which represents major German airports, said the strike had “almost completely paralysed air traffic”.

Verdi’s demands include an 8% pay rise, or at least €350 (£294) more per month, for all workers – and three extra days of holiday, plus one additional day for union members.

Stubbe said that while airport wages range were above minimum wage, ranging from €13-€25 per hour, workers in different roles – particularly security staff – received less annual leave than others.

“There have been two rounds of negotiations in which the employers have not yet offered one penny,” he added.

“It is quite usual that we don’t get any offers in the first round, but now even in the second round, the employers have basically said, ‘No, we’re not going to give you an offer because we don’t have any money’.”

BDLS, the body which sets security workers’ pay, said in a statement: “The damage caused by this strike is almost exclusively to companies that are not at the negotiating table.”

It called on the government to outlaw short-notice strikes, adding that air transport was “essential for Germany as a business location” which “must not be exploited” in collective pay disputes.

Ralph Beisel, ADV’s general manager, said the strike was having an impact on European and global air traffic, leading to missed connections due to a “domino effect”.

He called for reforms to German strike laws concerning “critical” infrastructure.

The so-called “warning strike”, an established tactic in German wage negotiations, concerns two separate pay disputes: one relating to airport security workers, and a broader disagreement over pay for federal and municipal government employees.

Verdi has also called for strikes in waste collection across several German cities, including Berlin, Essen and Kiel, where bins have gone unemptied since last week.

Pay talks for government workers are set to restart on Friday in Potsdam, while the next round of talks for airport security staff is scheduled to begin on 26 March.

Niklas Benrath, of the VKA, which regulates pay and conditions for municipal workers, also criticised the strikes, saying Verdi’s demands would cost nearly €15bn.

“With a total municipal debt of around €160bn, these demands are not financially viable,” he added.

(BBC News)

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Canada’s next PM Mark Carney vows to win trade war with Trump

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Mark Carney has won the race to succeed Justin Trudeau as Canada’s prime minister, vowing to win the trade war against US President Donald Trump as he takes charge of the country at a time of deep instability.

The former governor of the Canadian central bank and Bank of England beat three rivals in the Liberal Party’s leadership contest in a landslide.

In much of his victory speech, Carney, 59, attacked Trump, who has imposed tariffs on Canada and said he wants to make the country the 51st US state. “Americans should make no mistake,” he said. “In trade, as in hockey, Canada will win.”

Carney is expected to be sworn in as PM in the coming days and will lead the Liberals in the next general election, which is expected to be called in the coming weeks.

Carney, now prime minister-designate, has never served in elected office.

The Liberal leadership race began in January after Trudeau resigned following nearly a decade in office. He had faced internal pressure to quit over deep unpopularity with voters, who were frustrated with a housing crisis and the rising cost of living.

Carney won on the first ballot on Sunday evening, taking 85.9% of the vote to beat his nearest rival, former Finance Minister Chrystia Freeland.

Loud cheers erupted as the results were announced to a crowd of some 1,600 party faithful in Ottawa, Canada’s capital.

The party said more than 150,000 people had cast ballots in the race.

Carney, who will lead a minority government in parliament, could either call a snap general election himself or opposition parties could force one with a no-confidence vote later this month.

The governing Liberals have seen a remarkable political turnaround since Trudeau’s exit, as Canadians have been galvanised by Donald Trump’s trade threats and support for annexing their country

At the beginning of the year, they trailed the Conservatives, led by Pierre Poilievre, by more than 20 points in election polls.

They have since narrowed the gap and some polls show them statistically tied with Poilievre’s party.

(BBC News)

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