Thursday, September 20, 2018

BBC News - UK visas: High-skilled migrants cap 'should be scrapped'

DoctorsImage copyrightGETTY IMAGES
Image captionA report says there should be no limit on the number of high-skilled workers, such as doctors, coming to the UK to work
The cap on the number of high-skilled migrants coming to the UK should be scrapped, according to a key report commissioned by the government ahead of Brexit.
The Migration Advisory Committee says these workers make a more positive contribution to the public finances.
It suggests EU workers should be subject to the same visa rules as other migrants.
But it notes the UK might offer them special status under a Brexit deal.
The government has said it will "carefully consider" the committee's proposals.
Labour backed the report, calling for an "end to discrimination" against non-EU migrants.
Under the current system, workers from the European Economic Area (EEA) - which includes all EU countries including the UK, as well as Norway, Iceland and Lichtenstein - enjoy freedom of movement, travelling and working within the area without visas.

High v low skilled workers

The committee recommends a policy allowing greater access for higher-skilled migration while restricting access for lower-skilled workers.
It suggests extending the current scheme for high-skilled non-EEA migrants - known as a Tier 2 visa - to those from EEA countries as well.
As part of this process, the cap on the total amount of workers allowed to enter under Tier 2 should be abolished and the range of jobs eligeable for the visas expanded, the committee says.
Current policy is to allow 20,700 high-skilled workers into the UK each year on Tier 2 visas.
The current salary threshold for such visas is £30,000, which the report says should be retained.
Top priority is given to jobs on a "shortage occupation list".
Examples include:
  • Geophysicists
  • Mining engineers
  • 3D computer animators
  • Games designers
  • Cyber security experts
  • Emergency medicine consultants
  • Paediatric consultants
With regard to low-skilled workers, the committee says it is "not convinced there needs to be a work route for low-skilled workers" from the EU to fill jobs in industries such as catering or hospitality.
The "possible exception" to this rule could be for seasonal agriculture, where 99% of the workers come from EU countries.
It also does not recommend that there should be exceptions for workers coming to the UK to work in the public sector.

Different rules?

The committee - which is made up of independent experts, says it does not seen any "compelling reasons to offer a different set of rules" for workers from the EEA than those from other countries - unless such a position has been arrived at as part of the Brexit negotiations.
"A migrant's impact depends on factors such as their skills, employment, age and use of public services, and not fundamentally on their nationality," it says.
The report goes on to say there is no evidence that increased European migration has damaged life in the UK.
It concludes that EU migrants pay more in tax than they receive in benefits, contribute more to the NHS workforce than the healthcare they access, and have no effect on crime rates.
It says the impact of all EEA migration to the UK since 2004 was almost certainly less than that of the fall in the value of the pound following the referendum vote.

'The Brexit elephant in the room'

By Dominic Casciani, BBC home affairs correspondent
Waitress with drinksImage copyrightGETTY IMAGES
Image captionThe report says there should be no route to ensure low-skilled workers can come in from the EU
Ministers commissioned this report because they needed clear facts on the role of European workers in the country - and the implications of ending their freedom of movement.
But it's too soon to know how many of the committee's recommendations will be adopted because of the Brexit elephant in the room.
So while the experts want no special immigration deal for future EU workers (the report does not concern those who are already living in the UK), it doesn't consider whether a special deal would be good or bad for Britain.
Such a deal is a possibility. The prime minister's Chequers plan proposes a "mobility framework" - a system allowing British and EU citizens to study and work in each other countries, potentially linked to a trade deal.
So if the ministers offer special access for future EU workers, in return for something they want for the UK, this report won't help us know whether it is worth it.

'Pressure on the PM'

The MAC was asked to do the research in July 2017 by then Home Secretary Amber Rudd.
It is thought it could shape the government's post-Brexit immigration policy.
BBC assistant political editor Norman Smith said Mrs May might start "sketching out" her plans for this at October's Conservative Party conference.
He added that the report would increase pressure on her to not compromise on freedom of movement during the Brexit negotiations.

'An end to low-skilled migration'

Stephen Clarke, senior economic analyst at the Resolution Foundation, said if the recommendations were adopted, it would signal "the biggest change to the UK labour market in a generation" and would represent a "huge shift" for sectors such as hotels and food manufacturing.
He said: "If enacted, these proposals would effectively end low-skilled migration, while prioritising mid- and high-skill migration in areas where we have labour shortages.
The Royal College of Nursing welcomed the recommendations, saying the UK had long depended on recruiting nursing professionals from around the world.
But Lord Green of Deddington, chairman of Migration Watch UK, said the report was "blind to the impact" of EU migration to a number of communities.
He said the proposals would "permit continued high levels of immigration" and "the overall outcome would be to weaken immigration control".

Report 'puzzling'

The government says it will listen to the report and bring in an immigration system that works for the whole of the UK, adding: "EU citizens play an important and positive role in our economy and society and we want that to continue after we leave".
Shadow home secretary Diane Abbott said the UK's immigration policy should be "based on our economic needs, while meeting our legal obligations and treating people fairly".
"[This] means ending the discrimination against non-EU migrants, especially from the Commonwealth," she added.
But Yvette Cooper, Labour MP and chair of the Home Affairs Select Committee, said the report was "puzzling" with "significant gaps" between the MAC's research and recommendations.
"The MAC admit they have ignored the crucial relationship between immigration and trade," she said.

Wednesday, September 19, 2018

BBC News - China won't devalue yuan to boost exports, says Premier Li

China has hit back at accusations that it is using its currency as a tool in the trade war with the US.
Chinese and American national flags fly on Tian'anmen Square to welcome U.S. President Donald Trump on November 8, 2017 in Beijing, China.
At a forum in Tianjin, China's premier Li Keqiang said Beijing will not actively weaken the yuan to boost exports.
President Donald Trump has repeatedly accused China of manipulating its currency to combat US tariffs.
Mr Li's comments come amid an escalating trade war between the world's two largest economies.
The Chinese premier also said at the World Economic Forum it was essential that the basic principles of "multilateralism and free trade" were upheld.
The US has engaged in a protectionist agenda since Mr Trump took office in 2016, challenging the global system of free trade which has prevailed for decades.
His accusation that China has manipulated the yuan raised concerns that the currency market could become the next front in the economic battle between the two countries.
"The recent fluctuations in the [yuan] exchange rate have been seen by some as an intentional measure on the part of China. This is simply not true," Premier Li said.
"Persistent depreciation of the [yuan] will only do more harm than good to our country. China will never go down the path of stimulating exports by devaluating its currency," he added.
This week Washington raised the stakes by saying it would impose new tariffs on $200bn (£152.1bn) worth of Chinese goods from Monday. Beijing will hit back with new duties on $60bn of American imports.
During his campaign for president, Mr Trump also called China a currency manipulator but retracted those comments early last year.

Tuesday, September 18, 2018

Reuters News - Trump hits China with fresh tariffs, threatens more if Beijing retaliates

WASHINGTON/TIANJIN (Reuters) - U.S. President Donald Trump escalated his trade war with Beijing, imposing 10 percent tariffs on about $200 billion worth of imports in a move one senior Chinese regulator said “poisoned” the atmosphere for negotiations.
Trump also warned in a statement on Monday that if China takes retaliatory action against U.S. farmers or industries, “we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports.”
China is reviewing plans to send a delegation to Washington for fresh talks in light of the U.S. decision, the South China Morning Post reported on Tuesday, citing a government source in Beijing, raising the risk of a prolonged trade battle between the world’s largest economies that could hit global growth.
U.S. trade actions against China will not work as China has ample fiscal and monetary policy tools to cope with the impact, a senior securities market official said.
“President Trump is a hard-hitting businessman, and he tries to put pressure on China so he can get concessions from our negotiations. I think that kind of tactic is not going to work with China,” Fang Xinghai, vice chairman of China’s securities regulator, said at a conference in the port city of Tianjin.
Collection of tariffs on the long-anticipated list will start on Sept. 24 but the rate will increase to 25 percent by the end of 2018, allowing U.S. companies some time to adjust their supply chains to alternate countries.
So far, the United States has imposed tariffs on $50 billion worth of Chinese products to pressure Beijing to make sweeping changes to its trade, technology transfer and high-tech industrial subsidy policies. China has retaliated in kind.
Vice Premier Liu He was set to convene a meeting in Beijing on Tuesday morning to discuss the government’s response, Bloomberg News reported, citing a person briefed on the matter.
China has vowed to retaliate against new U.S. tariffs, with state-run media arguing for an aggressive “counterattack.”
Last month, it unveiled a proposed list of tariffs on $60 billion of U.S. goods ranging from liquefied natural gas to certain types of aircraft - should Washington activate the tariffs on its $200 billion list.
The effect of the 10 percent tariffs will gradually show up in China’s fourth-quarter data, and the full impact of the total 25 percent tariffs is expected to be felt next year, dragging down China’s gross domestic product (GDP) growth rate by 0.83 percentage point, Citi analysts wrote in a note.
Fang said that even if Trump puts tariffs on all Chinese exports to the United States, the negative impact on China’s economy will be about 0.7 percent. He did not say whether he was referring to the impact on the amount of GDP or the GDP growth.

FURTHER TALKS IN DOUBT

Trump’s latest escalation of tariffs on China comes after several meetings yielded no progress. U.S. Treasury Secretary Steven Mnuchin last week invited top Chinese officials to a new round of talks, but thus far nothing has been scheduled.
“We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly,” Trump said in his statement. “But, so far, China has been unwilling to change its practices.”
Fang told the Tianjin forum that he hopes the two sides can sit down and talk, but added that the latest U.S. move has “poisoned” the atmosphere.
A senior Trump administration official told reporters that the United States was open to further talks with Beijing, but offered no immediate details on when they may occur.
“This is not an effort to constrain China, but this is an effort to work with China and say, ‘It’s time you address these unfair trade practices that we’ve identified that others have identified and that have harmed the entire trading system,’” the official said.
So far, China has either imposed or proposed tariffs on $110 billion of U.S. goods, representing most of its imports of American products.
“Tensions in the global economic system have manifested themselves in the U.S.-China trade war, which is now seriously disrupting global supply chains,” the European Union Chamber of Commerce in China said in a statement on Tuesday.
China's yuan currency CNY=CFXSslipped 0.3 percent against the U.S. dollar in Asian trade on Tuesday. It has weakened by about 6.0 percent since mid-June, offsetting the 10 percent tariff rate by a considerable margin.[MKTS/GLOB]

CONSUMER TECH TRIMMED

The latest U.S. move spared smart watches from Apple (AAPL.O) and Fitbit (FIT.N) and other consumer products such as baby car seats. But if the administration enacts the additional tariffs on $267 billion in goods, it would engulf all remaining U.S. imports from China and Apple products like the iPhone and its competitors would not likely be spared.
The U.S. Trade Representative’s office eliminated 297 product categories from the proposed tariff list, along with some subsets of other categories.
But the adjustments did little to appease technology and retail groups who argued U.S. consumers would feel the pain.
“President Trump’s decision...is reckless and will create lasting harm to communities across the country,” said Dean Garfield, president of the Information Technology Industry Council, which represents major tech firms.
“Tariffs are a tax on American families, period,” said Hun Quach,” RILA’s vice president for international trade.
“Consumers – not China – will bear the brunt of these tariffs and American farmers and ranchers will see the harmful effects of retaliation worsen.”
Kenneth Jarrett, president of the American Chamber of Commerce in Shanghai, said three quarters of its members will be hit by the tariffs, and they will not bring jobs back to the United States.
“Most of our member companies are ‘in China, for China’ - selling goods to Chinese companies and consumers, not to Americans - and thus ultimately boosting the U.S. economy,” Jarrett said.
Reporting by Steve Holland, David Lawder, Ginger Gibson, Eric Beech and David Shepardson; Additional reporting by Kevin Yao in TIANJIN, John Ruwitch in SHANGHAI and Michael Martina and Ryan Woo in BEIJING; Editing by Clive McKeef and Kim Coghill

Monday, September 17, 2018

Bloomberg News - Ramaphosa Gives Taste of Plan to Kickstart South African Economy

South African President Cyril Ramaphosa shared parts of a package of reforms to kickstart an economy that’s in recession with business and labor leaders last week.
The measures, already adopted by the cabinet, will “secure confidence in sectors affected by regulatory uncertainty” and cover mining, telecommunications, tourism and transport, the presidency said in a emailed statement Sunday. It will “reprioritize government spending, within the existing fiscal framework, toward activities that will stimulate economic activity,” it said.
Ramaphosa revealed highlights of the plan at a Sept. 14 meeting attended by leaders of business formations, chief executives and the heads of the nation’s major labor federations. The full package should be announced at the Oct. 24 midterm budget, Finance Minister Nhlanhla Nene said earlier this month, adding it will include a long-awaited announcement on the allocation of spectrum to mobile-network operators.
The economy has shrunk for two straight quarters and business confidence has slipped to levels last seen when Jacob Zuma was president. Ratings company Moody’s Investors Service more than halved its economic growth projection for the year after the news, saying it adds to the nation’s fiscal challenges. Optimism faded as economic reforms weren’t implemented quickly enough and global trade wars and turmoil in other emerging markets soured sentiment.

Meeting Proposals

The Treasury’s 1.5 percent growth forecast for the year in its February budget is already below the 3 percent that Ramaphosa pledged to target in the run-up to the ruling African National Congress’s leadership election in 2017.
The ANC’s decision to back changes to the constitution to make it easier to seize land without compensation to help redress skewed ownership patterns has raised concern about a potential erosion of property rights. Policy uncertainty will linger until land-reform laws are formulated and this won’t happen until after next year’s election, damping investor sentiment and creating a credit-negative environment, Moody’s Vice President Lucie Villa said Sept. 13.
South Africa would need about 48 billion rand ($3.2 billion) for the package, the Mail & Guardian reported last month, citing Nene.
People attending the Sept. 14 meeting discussed proposals to start an infrastructure development initiative that draws in “private-sector funding and delivery expertise, the presidency said. Ramaphosa welcomed the offer extended by business for the secondment of private-sector professionals to the government to improve implementation, it said.

Friday, September 14, 2018

BBC News - Brexit: Carney warns no-deal could see house prices plunge

Mark Carney
The Bank of England's governor has warned the cabinet that a chaotic no-deal Brexit could crash house prices and send another financial shock through the economy.
Mark Carney met senior ministers on Thursday to discuss the risks of a disorderly exit from the EU.
His worst-case scenario was that house prices could fall as much as 35% over three years, a source told the BBC.
The warning echoes some of the Bank's previous comments.
The Bank of England routinely carries out "stress tests" to check whether the banking system can withstand extreme financial shocks.
Its latest one was conducted in November, when it said a 33% fall in house prices could occur in a worst-case scenario.
Several reports said that the Bank governor also told the Downing Street meeting that mortgage rates could spiral, the pound could fall and inflation would rise, and countless homeowners could be left in negative equity.
Speaking on Friday in Dublin, Mr Carney said the stress test was aimed at making sure the the largest UK banks could continue to meet the needs of the country through "even through a disorderly Brexit, however unlikely that may be".
"Our job, after all, is not to hope for the best but to plan for the worst," he added.
Mr Carney, who has just agreed to stay on as governor of the central bank until 2020, has faced strong criticism in the past, with Brexiteers accusing him of being part of the Remain camp.
Presentational grey line

Analysis:

Kamal Ahmed, economics editor
It appears that the Governor wasn't providing the Cabinet with a forecast of what the Bank believes would happen in the event of a no deal Brexit. He was briefing the Cabinet on what preparations the Bank was making if that does happen, including last November's stress test.
It was not a forecast.
It was an apocalyptic test where the Bank deliberately sets the parameters beyond what might reasonably be expected to occur. The major banks all passed the test, giving reassurance that the financial system can cope with whatever happens next year.
The Governor believes that a "no deal" scenario would be bad for the economy. But not as bad as the headlines today which are based on a doomsday scenario that is not actually forecast to happen.
Presentational grey line
That comment prompted leading Tory eurosceptic Jacob Rees-Mogg to call Mr Carney "the high priest of Project Fear", while former minister Iain Duncan Smith said "there is no such thing as a no-deal" and the Bank "struggled to understand how this would work".
Independent property expert Henry Pryor told the BBC that Mr Carney was "not predicting Armageddon, he was not predicting house prices would fall by a third, they are just making sure that if, for some extraordinary reason anything was to go horribly wrong, the bank is prepared."
But he warned house prices were likely to fall in the first half of the 2019 as people put off buying amid the Brexit uncertainty, while the number of sellers, "driven by death, debt and divorce" would remain about the same.
Following the Downing Street meeting, the Prime Minister's official spokesman said ministers remained confident of a Brexit deal, but had agreed to "ramp up" their no-deal planning.
"As a responsible government, we need to plan for every eventuality. The Cabinet agreed that no-deal remains an unlikely but possible scenario in six months' time," the spokesman said.
The Bank of England declined to comment.
The cabinet meeting was part of a series of no-deal planning sessions designed to discuss the "unlikely" scenario that the UK leaves the EU without an agreement in place. After each meeting, planning papers are published on various subjects.

Phones and driving

On Thursday, the papers disclosed that UK car drivers may have to get an international driving permit if they want to drive in some European countries after a no-deal Brexit.
The government said that after March 2019 "your driving licence may no longer be valid by itself" in the EU, in its latest no-deal planning papers.
The papers also warned that Britons travelling to the EU may need to make sure their passports have six months left to run.
And, in an interview with BBC Political Editor Laura Kuenssberg, Brexit Secretary Dominic Raab said the government was trying to give the "reassurance that consumers need" on the issue of mobile phone roaming charges but admitted that European operators could pass on charges.
He said: "No, I can't give a cast-iron guarantee. What I can say is that the government would legislate to limit the ability of roaming charges to be imposed on customers."