Fashion Industry Reinventing Itself by Embracing the Digital Age

For years denim jeans have been finished in foreign factories where workers use manual and automated techniques such as scraping with sandpaper or other abrasives to make the jeans appear worn and more comfortable to wear. But things are changing in the fashion world. As VOA’s Mariama Diallo reports, fashion companies are going digital to speed up the design and manufacturing process.


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US Sentences 21 People in India Call Center Scam

The U.S. government has sentenced 21 people to jail terms for their involvement in a call center scam based in India that targeted U.S. victims.

The prison sentences for the convicted ranged from 4 to 20 years.

“The stiff sentences imposed this week represent the culmination of the first-ever, large scale, multijurisdiction prosecution targeting the India call center scam industry,” U.S. Attorney General Jeff Sessions said in a statement Friday.

Thousands defrauded

U.S. officials say the call center scam defrauded thousands of U.S. residents of hundreds of millions of dollars. Prosecutors say the Indian call centers used various telephone fraud schemes to defraud mainly vulnerable Americans, including the elderly and legal immigrants.

Justice Department officials say some of the schemes included impersonating employees of the Internal Revenue Service or the U.S. Citizenship and Immigration Services.

Officials say the callers duped victims into believing that they owed money to the U.S. government and would be arrested or deported if they did not pay immediately.

Victims were instructed to wire money or purchase stored value cards. Once a victim provided payment, the call centers turned to a network of U.S.-based “runners” who would quickly move the money by using anonymous reloadable cards.

India and US defendants

Prosecutors say Miteshkumar Patel, 42, of Illinois, was the head of a Chicago-based crew of “runners” and also coordinated directly with the Indian side of the conspiracy. He was given the longest prison term of the group — 20 years.

“This case represents one of the most significant victories to date in our continuing efforts to combat elder fraud and the victimization of the most vulnerable members of the U.S. public,” Sessions said.

The indictment for the case also charged 32 India-based conspirators and five India-based call centers with general conspiracy, wire fraud conspiracy, and money laundering conspiracy. Those defendants have not yet been arraigned.


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US Senators Drop Efforts to Cripple China’s ZTE

U.S. Republican lawmakers have dropped their efforts to reimpose a crippling ban on exports to the Chinese telecommunications giant ZTE. 

The move Friday gives a victory to U.S. President Donald Trump who has championed for ZTE to stay in business. 

Republican senators Friday dropped legislation that would block ZTE from buying component parts from the United States. Senators had included the legislation in a defense spending bill passed last month, but a House version of the defense bill did not include the same provision.

Lawmakers say senators decided to leave the provision out of the final compromise bill, which is expected to come to a vote in the House and Senate in the coming days.

Lawmakers from both parties have been critical of President Trump over his decision to lift a ban on U.S. companies selling to ZTE.

Top Senate Democrat Chuck Schumer blasted Friday’s developments.

“By stripping the Senate’s tough ZTE sanctions provision from the defense bill, President Trump and the congressional Republicans who acted at his behest  have once again made President Xi and the Chinese Government the big winners,” he said in a statement.

Republican Senator Marco Rubio called dropping the provision “bad news” in a tweet Friday.ZTE is accused of selling sensitive technologies to Iran and North Korea, despite a U.S. trade embargo.

In April, the U.S. Commerce Department barred ZTE from importing American components for its telecommunications products for the next seven years, practically putting the company out of business. 

However, Trump later announced a deal with ZTE in which the Chinese company would pay a $1 billion fine for its trade violations, as well as replace its entire management and board by the middle of July.

The Commerce Department announced last week that it has formally lifted the ban on ZTE after the Chinese company complied with all terms of the settlement. 

Most of the world first heard of the dispute over ZTE in May after one of Trump’s tweets.

 

 

 


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Report: North Korea Economy Shrank Sharply in 2017

North Korea’s economy contracted at the sharpest rate in two decades in 2017, South Korea’s central bank estimated Friday, in a sign international sanctions imposed to stop Pyongyang’s nuclear and missile programs have hit growth hard.

Gross domestic product (GDP) in North Korea last year contracted 3.5 percent from the previous year, marking the biggest contraction since a 6.5 percent drop in 1997 when the isolated nation was hit by a devastating famine, the Bank of Korea said.

Industrial production, which accounts for about a third of the nation’s total output, dropped by 8.5 percent and also marked the steepest decline since 1997 as factory production collapsed on restrictions of flows of oil and other energy resources into the country. Output from agriculture, construction industries also fell by 1.3 percent and 4.4 percent, respectively.

“The sanctions were stronger in 2017 than they were in 2016,” Shin Seung-cheol, head of the BOK’s National Accounts Coordination Team said.

“External trade volume fell significantly with the exports ban on coal, steel, fisheries and textile products. It’s difficult to put exact numbers on those but it (export bans) crashed industrial production,” Shin said.

The steep economic downturn comes as analysts highlight the need for the isolated country to shift toward economic development.

Switch to economic construction

North Korean leader Kim Jong Un in April vowed to switch the country’s strategic focus from the development of its nuclear arsenal to emulating China’s “socialist economic construction.”

“As long as exports of minerals are part of the sanctions, by far the most profitable item of its exports, Pyongyang will have no choice but to continue with its current negotiations with the U.S. (to remove the sanctions),” said Kim Byeong-yeon, an economics professor at the Seoul National University with expertise in the North Korean economy.

North Korea’s coal-intensive industries and manufacturing sectors have suffered as the U.N. Security Council ratcheted up the sanctions in response to years of nuclear tests by Pyongyang.

China, its biggest trading partner, enforced sanctions strictly in the second half of 2017, hurting North Korea’s manufacturing sector.

Beijing’s suspended coal purchases last year cut North Korea’s main export revenue source while its suspended fuel sales to the reclusive state sparked a surge in gasoline and diesel prices, data reviewed by Reuters showed earlier.

2018 to be ‘a lot worse’

“This year will be a lot worse. Shrinking trade first hits the Kim regime and top officials, and then later affects unofficial markets,” said Kim at Seoul National University, adding that a reduction in tradable goods would eventually decrease household income and private consumption.

North Korea’s black market, or Jangmadang, has grown to account for about 60 percent of the economy, and is where individuals and wholesalers buy and sell Chinese-made consumer goods or agricultural products, according to the Institute for Korean Integration of Society.

China’s total trade with North Korea dropped 59.2 percent in the first half of 2018 from a year earlier, China’s customs data showed last week.

The BOK uses figures compiled by the government and spy agencies to make its economic estimates. The bank’s survey includes monitoring of the size of rice paddy crops in border areas, traffic surveillance, and interviews with defectors.

North Korea does not publish economic data.

North Korea’s Gross National Income per capita stands at 1.46 million won ($1,283.52), making it about 4.4 percent the size of South Korea’s, the BOK said.

Overall exports from North Korea dropped 37.2 percent in 2017, marking the biggest fall since a 38.5 percent decline in 1998, the BOK said Friday, citing data from the Korea Trade-Investment Promotion Agency.


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China Boosts Liquidity as Trade War Threatens Economy

Chinese policymakers are pumping more liquidity into the financial system and channeling credit to small- and medium-sized firms, and Beijing looks set to further loosen monetary conditions to mitigate threats to growth from a heated Sino-U.S. trade war.

The world’s second-biggest economy has started to lose momentum this year as a government campaign to reduce a dangerous build-up of debt has lifted borrowing costs, hitting factory output, business investment and the property sector.

As an intensifying trade conflict raises risks to exporters and overall growth, many economists expect the central bank to further reduce reserve requirements in the coming months, on top of the three reductions made so far this year.

Benchmark rate unchanged

However, few see a cut in the benchmark policy rate this year, as authorities walk a fine line between keeping liquidity conditions supportive and preventing any destabilizing capital outflows that could put the skids on a fragile yuan currency.

On Wednesday, a source with direct knowledge of the matter said the People’s Bank of China (PBOC) plans to introduce incentives that will boost the liquidity of commercial banks.

These are aimed at encouraging banks to expand lending and increase their investment in bonds issued by corporations and other entities, such as local government financing vehicles (LGFVs).

The PBOC has also been ensuring ample liquidity by allowing commercial banks to tap its Medium-Term Loan Facility (MLF), especially lenders that have invested in bonds rated AA+ and below, the source said.

The improved cash conditions have been reflected in reduced short-term borrowing costs for banks, with the country’s key seven-day money rate at 2.6409 percent Thursday, 37 basis points lower than recent highs at the end of June.

Economy expansion slows

The combination of lower interbank rates and the push to boost bank support should help to ease financing pressures for weaker firms, analysts said.

“This should spell good news for lower-grade bond markets which have been suffering from a flight to quality-grade bonds, and some firms have subsequently found access to liquidity difficult,” analysts at Everbright Sun Hung Kai said in a note.

China’s economy expanded a slower-than-expected 6.7 percent in the second quarter, and June factory output growth weakened to a two-year low as the trade dispute with the United States intensified.

To be sure, markets don’t expect aggressive policy loosening, given Beijing’s broad deleveraging pledge and fears that doing so could hit the yuan and trigger a spike in capital outflows.

Trade war worries have already weighed on the yuan, which hit a one-year low on Thursday.

Focus on small, medium businesses

A key focus is on small- and medium-sized enterprises (SMEs), which account for 80 percent of all jobs in China, and have suffered from rising borrowing costs and a shrinking credit pool amid Beijing’s three-year-long crackdown on off-balance sheet financing and a corporate debt build-up.

A trader at a state-run copper smelter in southern China told Reuters his firm has resorted to selling inventory to raise cash in light of the tougher financing conditions.

“Banks give, but the cost has gone up,” said the trader, who declined to be identified as he was not authorized to comment on his firm’s finances.

While the PBOC did not respond to faxed questions about its plans, a Shanghai-based trader at an Asian bank said the bond market had seen a notable pick-up in the volume of trade of LGFV debt.


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Chinese Ambassador: EU Should Not Mix Politics,Trade in Cambodia

China’s Ambassador in Phnom Penh says the European Union should not mix politics with trade as it mulls withdrawing Cambodia’s vital preferential single market access in response to the country’s autocratic backslide.

The European Union has just wrapped up a fact-finding mission to Cambodia to determine if Everything But Arms (EBA) trade preferences should be withdrawn in light of actions such as the dissolution of the only viable alternative party at this month’s national election.

After delivering a public lecture about China’s Belt and Road initiative to students Tuesday at the University of Cambodia, Ambassador Xiong Bo repeatedly stressed free trade should not be impacted by political preconditions in response to a question about the EBA.

“So I think in terms of the trade relations between the EU and Cambodia I think these trade relations should be conducted according to the economic and trade rules but should not be changed according to any political reasons,” he said, speaking through a translator.

“No matter what the EU will do the Chinese will stand firmly in expanding and deepening our cooperation with Cambodia in all fields, especially in terms of trade and economic relations,” he said.

China has pumped billions of dollars into Cambodia through investment, concessional loans and aid in recent years, dramatically undermining the influence of Western powers in the country.

Xiong said the European Union has declared itself a staunch supporter of global free trade, sentiments he hoped the bloc would stick to, adding he did not believe all member states would support moves to withdraw the EBA.

Any decision to withdraw EBA status from Cambodia would require consensus among EU members.

The EBA grants developing countries such as Cambodia quota free and duty free access to the EU market.

This access is conditional on compliance with certain international human rights standards and countries have been sanctioned before for failing to meet those.

The European Union is Cambodia’s biggest market, absorbing about half of the country’s exports.

Monday, EU Ambassador to Cambodia George Edgar said a European Commission fact finding mission examining human rights and labor rights in the context of the EBA had concluded and would now report to EU decision makers.

Last week, EU trade commissioner Cecilia Malmstrom said withdrawing the EBA was a “last resort if all our other efforts have failed” to address the bloc’s concerns.

Chief among those concerns are the jailing of Cambodia National Rescue Party (CNRP) leader Kem Sokha in September and the dissolution of his party in November.

In both cases the actions were predicated on their alleged involvement in an internationally backed conspiracy to overthrow the government of Prime Minister Hun Sen, who has ruled for 33 years.

Rights groups and foreign governments including the European Union have slammed the moves as a transparent ploy by Hun Sen to crush his only viable opponents before the country’s July 29 election. The United States has already sanctioned the commander of Hun Sen’s bodyguard unit, for carrying out “serious acts of human rights abuse against the people of Cambodia.”

Cambodia’s government says they are meddling in its internal affairs.

Cambodian government nervous

In June, Hun Sen dispatched one of his top advisors, Sok Siphana, to Brussels to lobby the European Union against removing the EBA.

A Cambodian statement at the time said, “Sadly and quite unfairly, in a very large number of cases, the Government felt like the victim of unfounded accusations and excessive generalizations.” It concluded, “There is a conspiracy and a treasonous act of collusion with a foreign power to do a regime change through undemocratic means. How could it be otherwise?”

Sok Siphana, a prominent lawyer and economic advisor who led Cambodia’s negotiations into the World Trade Organization in 2003, has not responded to VOA inquiries about the lobbying effort.

Political Analyst Meas Ny said he did not believe Sok had been successful in his mission.

“The recent mission sent by the Cambodian government it was hard for the head of the delegation to convince the EU community because I think the EU so far have got their information from all sources,” he said.

He said it is clear the Cambodian government is not going to change its stance due to the threat of EBA withdrawal.

“But I think we can talk up a lot of issues that the government might be facing in the future if the EBA is lifted,” he said.

Chief among those, Meas said, was the knock on effect to Cambodia’s micro-finance sector from the resulting unemployment among Cambodia’s 700,000 garment workers, many of whom are heavily indebted.

Late last year, Commerce Minister Pan Sorasak warned in a leaked letter if the EBA were withdrawn Cambodia would have to pay $676 million for an estimated $6.2 billion in revenue from exports to the European Union.


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Report: Asia-Pacific Factories Lead in Using Digital Technology

She may not be the warmest waitress, but she serves a nice, hot cup of “Joe” at a café on the outskirts of Ho Chi Minh City.

Though this robotic barista is still getting help from her human counterpart, she is a signal that Asia is ahead of the curve in embracing new technologies ahead of the Americas, Europe, the Middle East, and Africa.

A recent report from PwC Global, a professional services firm, studied 1,155 manufacturing businesses based on how much they were embracing and incorporating innovations in technology, from drones to 3-D printing.

Across the board, companies in the Asia-Pacific region scored higher than their counterparts elsewhere in the world.

In Thailand, for instance, manufacturing companies have widely adopted new technologies to transform their operations.

“Many are using robots to assemble products at their factories to rely less on human labor, reduce costs, and boost overall efficiency,” said Vilaiporn Taweelappontong, consulting lead partner at PwC Thailand.

​ASEAN catches up

The report graded firms based on questions about the kinds of tools they were introducing into their workplaces. For example, manufacturers were asked if they made use of virtual reality; 44 percent in the Asia Pacific said they did compared with 34 percent in the United States and 19 percent in Europe, the Middle East, and Africa.

The regional group Association of Southeast Asian Nations (ASEAN) reports that small and medium enterprises are using new technology to catch up to bigger rivals.

“Digitization is enabling SMEs across ASEAN to participate in cross-border trade, allowing them to grow and scale their businesses while reducing costs,” said Bidhan Roy, a general manager at Cisco Systems Pte Ltd.

​Benefits of youth

Observers say the Asia-Pacific region benefits from its youth.

The relatively young population means people are amenable to different work environments and business operations, as well as having a keen interest in using new technology.

Another advantage? The region’s economies are also somewhat young, with many just opening up to global trade in the last two decades. In addition its underdeveloped infrastructure has the ability to adapt for future needs, like public transit or drone deliveries.

“Asian companies have the advantage of setting up robust digital operations from essentially a blank slate in terms of factory automation, workforce, and even organizational IT [information technology] networks as a whole,” the PwC report said.

Baby steps

But more is needed to make these companies successful.

Cisco Systems’ Roy noted that small and medium firms “are at varying stages of maturity in terms of digital adoption” and could use collaboration with governments and corporations.

PwC Thailand’s Vilaiporn agreed on the benefit of collaboration.

“Thailand 4.0 will only be successful if both the government and private sectors understand their roles in fostering investment and focusing on research and development, as well as equipping the workforce with necessary skill sets and capabilities,” he said.

The “4.0” refers to the latest industrial revolution, which goes beyond mechanization and automation. It entails business processes becoming more efficient through a comprehensive application of technology, from smart devices to machine learning.


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50 Years After Concorde, US Start-Up Eyes Supersonic Future

Luxury air travel faster than the speed of sound: A US start-up is aiming to revive commercial supersonic flight 50 years after the ill-fated Concorde first took to the skies.

Blake Scholl, the former Amazon staffer who co-founded Boom Supersonic, delivered the pledge this week in front of a fully-restored Concorde jet at the Brooklands aviation and motor museum in Weybridge, southwest of London.

The company aims to manufacture a prototype 55-seater business jet next year but its plans have been met with scepticism in some quarters.

“The story of Concorde is the story of a journey started but not completed — and we want to pick up on it,” Scholl said at an event that coincided with the nearby Farnborough Airshow.

“Today … the world is more linked than it’s ever been before and the need for improved human connection has never been greater.

“At Boom, we are inspired at what was accomplished half a century ago,” he added, speaking in front of a former British Airways Concorde.

Boom Supersonic’s early backers include Richard Branson and Japan Airlines, and other players are eyeing the same segment.

Speaking to AFP at Farnborough on Wednesday, Scholl indicated that the air tickets could be beyond the reach of some.

“What we’ve been able to do thanks to advances in aerodynamics and materials and engines is offer a high speed flight for the same price you pay in business class today,” he said. 

He said this works out to around $5,000 (4,300 euros) round-trip across the Atlantic.

“Now I know that might sounds like a lot, because it is, but it’s actually the same price you pay for a lay flat bed on airlines today,” he said.

‘Baby Boom’

Boom Supersonic’s aircraft, dubbed Baby Boom, is expected by the company to fly for the first time next year.

The company is making its debut at Farnborough and hopes to produce its new-generation jets in the mid-2020s or later, with the aim of slashing journey times by half.

The proposed aircraft has a maximum flying range of 8,334 kilometres (5,167 miles) at a speed of Mach 2.2 or 2,335 kilometres per hour.

If it takes off, it would be the first supersonic passenger aircraft since Concorde took its final flight in 2003.

The Concorde was retired following an accident in 2000 in which a Concorde crashed shortly after takeoff from Paris, killing 113 people.

“The one accident that did happen on Concord actually happened on the runway,” Scholl told AFP on Wednesday.

“It had nothing to do with high-speed flight so there’s no actual barrier to creating a highly safe, efficient supersonic airplane and we have super high standards for safety.

“We’ll be going through the same safety testing process that every other aircraft goes through and the FAA (US Federal Aviation Administration) and EASA (European Aviation Safety Agency) will not let our airplane fly unless we pass a very high safety bar.”Some analysts meanwhile remain sceptical over the push back into supersonic, with consumer demand booming for cheap low-cost carriers.

“Supersonic is not what passengers or airlines want right now,” said Strategic Aero analyst Saj Ahmad.

Ahmad said supersonic jets were “very unattractive” because of high start-up development costs, considerations about noise pollution and high prices as well as limited capacity.

‘Untried and untested’

Independent air transport consultant John Strickland noted supersonic travel was unproven commercially.

“If there is an economic downturn or something happens where the market for business class traffic drains away, then you have nothing else left to do with that aircraft,” Strickland said.

“I think it’s going to be some time before we see whether it can establish a large viable market … in the way that Concorde never managed to do.”

These concerns have not stopped interest from other players.

US aerospace giant Boeing had last month unveiled its “hypersonic” airliner concept, which it hopes will fly at Mach 5 — or five times the speed of sound — when it arrives on the scene in 20 to 30 years.

And in April, NASA inked a deal for US giant Lockheed Martin to develop a supersonic “X-plane.”


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Elon Musk Apologizes for Comments About Cave Rescue Diver

Tesla and SpaceX CEO Elon Musk has apologized for calling a British diver involved in the Thailand cave rescue a pedophile, saying he spoke in anger but was wrong to do so.

There was no immediate public reaction from diver Vern Unsworth to Musk’s latest tweets.

Musk’s initial tweet calling Unsworth a “pedo” was a response to a TV interview Unsworth gave. In it, he said Musk and SpaceX engineers orchestrated a “PR stunt” by sending a small submarine to help divers rescue the 12 Thai soccer players and their coach from a flooded cave. Unsworth said the submarine, which wasn’t used, wouldn’t have worked anyway.

“My words were spoken in anger after Mr. Unsworth said several untruths …” Musk tweeted.

“Nonetheless, his actions against me do not justify my actions against him, and for that I apologize to Mr. Unsworth and to the companies I represent as leader. The fault is mine and mine alone.”

Musk’s Sunday tweet, later deleted, had sent investors away from Tesla stock, which fell nearly 3 percent Monday but recovered 4.1 percent Tuesday. Unsworth told CNN earlier this week that he was considering legal action. He did not respond to requests for comment from The Associated Press.

In his latest tweets, Musk said the mini-sub was “built as an act of kindness & according to specifications from the dive team leader.”

Musk has 22.3 million followers and his active social media presence has sometimes worked well for Tesla. The company has said in its filings with the Securities and Exchange Commission that it doesn’t need to advertise because it gets so much free media attention.

But straying away from defending his companies into personal insult brought Musk some unfavorable attention at a time when Tesla, worth more than $52 billion, is deep in debt and struggling for profitability. 

In northern Thailand on Wednesday, the 12 Thai soccer players and their coach answered questions from journalists, their first meeting with the media since their rescues last week. Doctors said all are healthy.


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Trump’s Top Economic Adviser Accuses China’s President of Delaying Trade Deal

U.S. President Donald Trump’s top economic adviser accused Chinese President Xi Jinping Thursday of stalling efforts to resolve a growing trade dispute with the U.S.

White House National Economic Council Director Larry Kudlow said he believed lower-level Chinese officials want to end tariffs the world two largest economic powers have imposed on each other, but that Xi has refused to amend China’s technology transfer and other trade policies.

“So far as we know, President Xi, at the moment, does not want to make a deal,” Kudlow said in an interview on CNBC. “I think Xi is holding the game up,” Kudlow said, and added, “The ball is in his court.”

Kudlow said China could end U.S. tariffs “this afternoon” if it took measures that include cutting tariff and non-tariff barriers to imports. The U.S. has also called on Beijing to end the “theft” of intellectual property and allow full foreign ownership of companies operating in China.

Kudlow also said he expects European Commission President Jean-Claude Juncker to make a trade offer when he meets with Trump at the White House next week.

Trump has demanded that the EU cut its 10 percent tariffs in auto imports at a time when his administration is conducting a national security study that could result in a 25 percent U.S. tariff on imported vehicles.

A 25 percent tariff would have a significant financial impact on European and Japanese automakers, and while Juncker has said he would make an trade offer to Trump next week, he did not offer details.

Earlier this month, Trump imposed 25 percent tariffs on Chinese goods valued at $34 billion, with another $16 billion set to take effect in the near future. Trump has also announced 10 percent tariffs on an additional $200 billion of Chinese products that could be imposed as early as next month.

Beijing retaliated to the first tariffs by placing duties on the same dollar amount of American imports, and has vowed to counter any further U.S. actions.

Trump imposed the tariffs after an Office of the U.S. Trade Representative investigation concluded China was violating intellectual property rules and forcing U.S. companies operating in China to hand over technology secrets in exchange for access to the Chinese market.


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